Limitation of expired patents

The Borgarting Court of Appeal has issued a ruling related to matters involving administrative patent limitation after the expiration of the patent. In this article, we will give an overview of the parties' arguments and look at the reasons the Borgarting Court of Appeal used to overrule Oslo District Court's decision.

On 16 December 2022, the Norwegian Board of Appeal for Industrial Property Rights ("KFIR") rejected a request for administrative patent limitation made by Merck Sharp & Dohme LLC ("MSD"). MSD challenged KFIR's rejection at the Oslo District Court, which dismissed the case due to MSD's lack of legal interest in the patent because the patent and the corresponding SPC protection had expired. SPC stands for "Supplementary Protection Certificate, and SPC protection serves as an extension to a patent right in the pharmaceutical industry. On 19 May 2023, MSD appealed the District Court's decision to the Borgarting Court of Appeal, claiming to have legal interest under the Norwegian Dispute Act section 1-3 even after the expiry of the patent.

This led to a highly relevant ruling concerning patent owners' legal interest in cases concerning administrative patent limitations where the patent protection has expired.

To support the claim of having legal interest under the Norwegian Dispute Act section 1-3, MSD asserted having a genuine necessity to get KFIR's decision reviewed by the Court. In this context, MSD's main argument was that an administrative patent limitation would directly impact the scope of third-party activities for which MSD could claim compensation, and that the right to claim compensation does not cease upon expiration of the patent or SPC protection. Thus, the main point in MSD's argumentation was that the question of administrative patent limitation is directly relevant to MSD's ability to claim compensation for third-party infringement of the patent or the SPC during the time they were valid, even after the protection had expired.

Additionally, MSD argued that the District Court's legal interpretation of the Norwegian Disputes Act section 1-3 would prevent any review of rejections of requests for patent limitations, due to such claims always will be tied to the extent of the patent holder's enforcement of rights against third parties. Furthermore, MSD cautioned that if the District Court's interpretation is widely accepted, issues concerning the review of rejections of requests for patent limitation will never be deemed to have an immediate and direct legal consequence for the patent owner.

On the other hand, KFIR argued that an administrative patent limitation would not have direct or immediate legal consequences for MSD after expiry of the patent or the SPC protection. To support this argument, KFIR highlighted that a judgement in favour of an administrative patent limitation for MSD would not expand the scope of compensation claims MSD already had, because an administrative patent limitation never can cover more than what was originally protected by the patent.

In the assessment of MSD's legal interest, the Borgarting Court of Appeal concluded that MSD had legal interest in getting KFIR's rejection of the request for patent limitation reviewed.

The Court of Appeal's conclusion was based on the fundamental argument that MSD's legal interest is not solely determined by the expiry of the patent and SPC protection. The Court of Appeal also highlighted that, as asserted by MSD, the system of the Norwegian Patent Act allows for patent limitation to be requested even after expiry of the protection's lifespan. Furthermore, the Court of Appeal stated that there is no reason for different treatment of patents with an additional SPC protection.

Since the expiry of the patent and SPC does not itself automatically constitute lack of legal interest, the Court of Appeal furtherly emphasised that legal consequences of administrative patent limitation, that changes the patent owner's legal position for future claims of compensation, is not dependant on the patent's validity or the SPC protection. Even though the Court underlined that a decision for patent limitation would not have an immediate legal effect, the Court highlighted MSD's pending compensation lawsuits regarding the disputed patent and SPC as highly relevant, and emphasised that potential administrative patent limitation could have significant relevance to resolution of pending lawsuits.

Hence, MSD's claim of having legal interest was fully upheld by Borgarting Court of Appeal.

The Court of Appeal's decision demonstrates that a patent owner's legal interest in cases regarding administrative patent limitation does not cease solely due to the expiration of the patent that is sought to be limited. The decision also illustrates that the question of legal interest in cases concerning administrative patent limitations must be determined based on the individual circumstances of each case. Overall, the decision constitutes a highly relevant clarification regarding the issue of legal interest in cases if administrative patent limitation where the disputed patent has expired, which can have a significant impact on future patent-related disputes.

The main hearing of the case will be held in Oslo District Court in February 2024. During the handling of the question on legal interest before the Borgarting Court of Appeal, MSD was assisted by Schjødt as legal counsel.