Higher Regional Court Düsseldorf (Infusionsvorrichtung II) – No contributory negligence of the plaintiff

In its judgement of 13 July 2023 (docket no. 2 U 79/22), the Higher Regional Court Düsseldorf had to decide the question of whether a claim for damages due to patent infringement can lapse due to contributory negligence of the plaintiff.

1. Facts of the case

The plaintiff had already brought a first patent infringement case against one of the defendants based on patent in suit A. These proceedings related to the first generation of insulin pumps, which one of the defendants had been selling on the German market since 2016. In a judgement dated 13 August 2020 (docket no. 4c O 20/19), the Regional Court Düsseldorf found one of the defendants guilty of patent infringement. The defendant did not attack the judgement on appeal. The judgement therefore became final upon expiry of the appeal period.

As a result, the defendant significantly modified the first-generation insulin pumps and launched them on the German market (second generation) in October 2020. In the course of this, it also changed its distribution structure.

Against this second generation of insulin pumps, the plaintiff filed another action before the Regional Court Düsseldorf based on patent in suit B. This action was directed against the defendant from the first lawsuit, among others. In its judgement of 26 April 2022 (docket no. 4c O 26/21), the Regional Court of Düsseldorf found the defendants guilty of patent infringement because the second-generation insulin pumps make use of patent in suit B.

The defendants have appealed against this. The defendants argue, among other things, that the plaintiff is contributorily negligent and that the claim for damages has therefore lapsed completely. The plaintiff could have already asserted the patent in suit B against the first-generation insulin pumps. The plaintiff would then have been spared a modification (second-generation insulin pump) infringing patent in suit B and an infringing act as a result.

2. Decision of the Higher Regional Court Düsseldorf

The Higher Regional Court Düsseldorf dismissed the defendant’s appeal.

The plaintiff was not guilty of contributory negligence. It is not an obligation of a patentee to prevent the infringer from further infringing acts against other patents of the patentee. This applies in any case if the patent proprietor has not established a special case of trust, for example through pre-litigation correspondence or similar. In the absence of such a special case of reliance, it is the sole responsibility of the infringer to ensure that his actions do not infringe the property rights of others. It is therefore the infringer’s duty to research the relevant third-party property rights.

In addition, the Higher Regional Court Düsseldorf stated that even in the case where such an assumption of reliance can be made, the fault of the patent infringer cannot be completely ruled out. After all, it is primarily the competitor’s responsibility to ascertain the existence of third-party property rights.

3. Practical note

This judgement by the Higher Regional Court Düsseldorf impressively demonstrates that when advising on design around solutions, it is not enough to focus solely on the property right in dispute. In any case, special attention should be paid to the other family members of the patent in suit.

Ideally, the infringer should carry out a comprehensive examination of all possible IP rights (FTO) in relation to the design around solution. Otherwise, it is possible that the design around solution may even make use of another competitor’s patents, which could lead to a further cost-intensive dispute with another competitor.

Carsten Plaga

Juve Patent Ranking Germany 2023: Kather Augenstein again among the top IP law firms and leading IP specialists in Germany

We are very pleased that Kather Augenstein was again able to defend its ranking of previous years in the current edition of the highly regarded JUVE Patent Ranking Germany 2023.

As the year before, Kather Augenstein achieved the second-highest rating of four stars in the category Patent Litigation – Lawyers.

In addition to the strength for litigation within a broad range of industries, JUVE Patent again underlines in this year’s rating the European set-up of our boutique firm in representing our clients before the Unified Patent Court. You can read the full analysis here.

Furthermore, we are very pleased that no less than three of our partners are represented among the leading individuals in the field of patent litigation – lawyers this year: besides our senior partner Dr Peter Kather, Dr Christof Augenstein has also been highlighted as a leading individual this year. Christopher Weber is listed among Germany’s leading litigators in patent law for the third time in a row.

A special thanks goes to our clients and colleagues, who gave high praise to no less than four of our partners and IP specialists. Dr Peter Kather, is described as “highly client-oriented with perfect advice on strategy and proceedings”, while Christof Augenstein is rated by a client as “creative, pragmatic and responsive”, “an in-house lawyer’s dream to work with”. Miriam Kiefer and Christopher Weber receive same high praise, both are also underlined for their “very good technical understanding”.

“The excellent rating of our firm is never the result of a single person, but of our entire team. A big thank you therefore goes to the outstanding team at Kather Augenstein, which made this success possible,” says our Managing Partner Miriam Kiefer.

FCJ, Judgment of 20 June 2023 – X ZR 61/21 – Faserstoffbahn

When are the limits of the right of prior use exceeded if a modification is used? The 10th Civil Senate dealt with this question in its decision Faserstoffbahn.

I. Facts

The subject matter of the infringement proceedings was Defendant’s panty liner. Regional Court of Düsseldorf essentially condemned Defendant as requested. On appeal to Higher Regional Court Düsseldorf, Plaintiff limited the action to a further embodiment, which featured superabsorbent polymers (SAP) for the first time, asserting a combination of main and sub-claims. 

Higher Regional Court Düsseldorf denied a right of prior use and dismissed Defendant’s appeal. In its judgement, it stated that it was undisputed that the pre-used panty liner did not have any SAP. However, the prior user was limited to the use of the possession of invention which he had used before the priority date. Consequently, there was already no protected possession of invention – the question of the scope of a right of prior use in the case of modifications therefore did not arise.

In response to Defendant’s appeal, FCJ set aside the judgment and referred the case back to Higher Regional Court Düsseldorf for a new decision and hearing on the merits.

II. Reasons

The prior user is limited to the use of the possession of invention for which all requirements of the exception were fulfilled before the priority date. The prior user is precluded from further developments beyond this possession of invention if they interfere with the subject-matter of the protected invention. Whether a different form of use exists has to be assessed on the basis of the claims interpreted in the light of the description and drawings.

In particular, the prior user exceeds the limit of its right of prior use if an additional advantage is obtained for the first time with the modification. The situation is different, however, if the patent or utility model discloses a deviation from the prior use which the person skilled in the art would have taken into account without further ado at the time of priority.

However, Court of Appeal did not carry out this examination, but erred in law in assuming that the question of scope due to a modification did not arise in principle.

The modification of a pre-used object, which realises all features of an independent claim of the utility model in suit, could also be covered by a right of prior use if the pre-used object did not realise the further features before which are now mandatory according to the motion. This applies irrespective of whether only the infringement action was based on a version of an independent claim limited in the manner mentioned or whether the utility model had been limited accordingly in cancellation proceedings.

III. Conclusion

If a modification realises additional features of a subclaim for the first time, the limits of the right of prior use are not exceeded per se. In individual cases, this may indicate that an additional advantage is achieved which is no longer covered by the right of prior use. However, this must be examined on the basis of the granted patent or registered utility model.

Marco Berlage

Aluminiumdielen – Higher Regional Court Karlsruhe decision 18.07.2023 – 6 W 30/23

In its decision of 18 July 2023, the Higher Regional Court Karlsruhe dealt both with enforcement under Section 888 of the German Code of Civil Procedure (ZPO) and with the question of whether an infringing object is still within the channels of distribution if it is located with a trader who is not a dealer.

The case

The present case was an appeal against a decision of the Regional Court Mannheim (order of 19 May 2023, docket 2 O 86/21 ZV II). In this decision, the Regional Court Mannheim ruled that the debtors had to recall or definitively remove from distribution channels („zurückzurufen oder endgültig aus den Vertriebswegen zu entfernen“) the outdoor aluminium floorboards („Outdoor-Aluminiumdielen“) in question. The debtors defended themselves against this with the argument that there were no more products in the distribution channels and that a recall was therefore impossible. They justify this with the fact that all products placed on the market have already been installed and have thus become the property of the end users.

The decision

In the order, the Regional Court of Karlsruhe, in addition to the admissibility of the application, first states that an order to recall or remove is to be enforced according to Section 888 ZPO. The Chamber justifies this by stating that the wording of the judgment “or” allows the debtors to choose between the two options. Since at least the recall is a non-justifiable act within the meaning of Section 888 ZPO, enforcement – irrespective of the justifiability of the further option – is to be enforced according to Section 888 ZPO. According to the Chamber, it is irrelevant whether the optionally ordered Removal from distribution channels also constitutes a non-justifiable act or is to be enforced as a non-justifiable act from Section 887ZPO.

With regard to the substantive issues of the decision, Section 140a (3) sentence 1 German Patent Act must be observed in the present case. Pursuant to Section 140a (3) sentence 1 German Patent Act, infringers whose inventions are used contrary to Sections 9 to 13 German Patent Act may demand that the infringing party recalls the products or permanently removes them from distribution channels.

With regard to the question of when an infringing object is still in the distribution channels, the Higher Regional Court Karlsruhe focuses on the concept of the private end consumer in the present decision. The Chamber clarifies that an infringing object is still in the channels of distribution („in den Vertriebswegen“) even if the customer is a trader who is not a dealer. The Higher Regional Court of Karlsruhe justifies this decision by stating that it is conceivable that an object is later sold in the course of a commercial act and that a patent-infringing act is thereby carried out. In the present case, the Chamber argues that the property in which the outdoor aluminium floor („Outdoor-Aluminiumdielen“) was installed could later be sold by the trader as a commercial act. Due to these circumstances, the court concludes that a resale of the floorboards is not sufficiently excluded. The debtors’ objection that the products had already been installed at the buyers’ premises did not justify a different decision in the court’s view either. The court justified this by stating that the recall pursuant to Section 140a (3) sentence 1 German Patent Act is merely a demand on the debtor to return the delivered products to the buyer; it has no effect on the debtor whether the buyers actually comply with the demand or not. The debtor has fulfilled his legal obligation if he has issued the demand. The recall is not precluded by the fact that a removal with a single distribution of the floorboards is very unlikely.

In its earlier case law, the Regional Court Mannheim had taken a different view. In its decision of 10 December 2013, docket 2 O 180/12, it stated that the end buyers/end users are not part of the distribution channel. It should be the same whether they use the object commercially or not. Objects that are with private or commercial buyers are no longer within the distribution channels if the buyers are to be classified as end users („Endabnehmer“).

The Higher Regional Court Karlsruhe based its decision, inter alia, on earlier decisions of the Higher Regional Court Düsseldorf. The decisions of the Higher Regional Court Düsseldorf also come to the conclusion that objects are in principle still in the distribution channel if they are with a commercial buyer. Here, too, the court states that it makes no difference whether the commercial buyer is to be classified as an end user or not.
In its decision of 15 July 2021 – 15 U 42/20, the Higher Regional Court Düsseldorf justified its decision by stating that a commercial end user generally infringes a patent if he commercially uses the infringing product. In this case, he owns the infringing product for the purpose of use pursuant to Sec. 9 Sentence 2 No. 1 German Patent Act.
In its decision of 13 August 2020 – 2 U 10/19, the Higher Regional Court Düsseldorf also came to the conclusion that a product is still”in the distribution channels („in den Vertriebswegen“) even if it is held by a commercial end user. In the case at hand, the parties were arguing about spark plugs in a gas engine and here, too, the court argued that it is not unlikely that the engine equipped with the spark plugs will be sold second-hand and that the patent-infringing spark plugs will thus also be used commercially. In addition, the Higher Regional Court Düsseldorf stated that a product is only not in the channels of distribution („in den Vertriebswegen“) if it can be ruled out that it will be further distributed at a later point in time.

The Higher Regional Court Karlsruhe takes up the aforementioned arguments of the Higher Regional Court Düsseldorf and applies them to its own case.

With the present ruling, the Higher Regional Court Karlsruhe thus follows the existing case law of the Düsseldorf Higher Regional Court.

The Pharmaceutical Intellectual Property and Competition Law Review – Update: Christopher Weber und Dr. Benjamin Pesch publish on recent developments in intellectual property and competition law in the pharmaceutical sector in Germany

This latest 4. edition of The Pharmaceutical Intellectual Property and Competition Law Review, our partner Christopher Weber and our counsel Dr Benjamin Pesch have published another chapter on current developments in the German market, based on their expertise in the pharmaceutical sector.

In Chapter 5, they provide an update on the general principles and recent developments in intellectual property and competition law in the pharmaceutical sector in Germany. A detailed insight into the German chapter can be found here.

Excerpts of the publication are also published as part of our partnership on Lexology. If you are interested in a bound copy of the book, please contact our two authors:

weber@katheraugenstein

pesch@katheraugenstein

The Pharmaceutical Intellectual Property and Competition Law Review is an annual hardcover and online guide covering legal and market developments in key jurisdictions in the pharmaceutical sector worldwide. As an “annual review”, the publication provides a detailed analysis of recent developments in legislation and its interpretation by national authorities around the world and aims to give users an insight into future trends.

About the Law Reviews:

The Law Reviews is a network of experts covering over 108 areas of law in more than 130 countries worldwide, aimed at practitioners looking beyond their own borders for strategic solutions in foreign jurisdictions.

Progressive thinkers from the world’s leading law firms analyse global legal issues and their business implications. The Law Reviews is an essential resource for lawyers, in-house counsel, governments and corporate executives.

The editors of The Law Reviews are recognised international industry experts in key practice areas.

Managing IP Stars honours Dr Benjamin Pesch again as “Rising Star 2023” in its latest edition

Managing IP recently released its Rising Star Rankings Germany 2023. We are delighted that Dr Benjamin Pesch, Counsel, has been awarded as  Rising Star 2023 for his third time.

We specially like to thank our peers and our clients who contributed to this ranking with their reviews. The feedback received from colleagues, peers and clients represents the cornerstone for the Rising Star distinction. This is a confirmation of Dr Benjamin Pesch’s strong professional commitment with which he meets the constantly evolving needs of his clients to a high degree.

About IP Stars:
Managing IP launched its official Rising Stars publication in 2018 (read more here). This special publication, which is produced by the IP STARS research team, recognises some of the best up-and-coming intellectual property practitioners in private practice who have contributed to the success of their firms and clients. Although selection is primarily based on an individual’s contributions and expertise, we can also take account of their activities in the IP community.

2023 – FOCUS Legal Special – Kather Augenstein again among the TOP Business Law Firms for Patent and Trademark Law 2023 in Germany

In its latest issue “FOCUS-Recht-Spezial”, FOCUS magazine has once again named the entire boutique law firm Kather Augenstein as one of the TOP business law firms 2023 in Germany in the field of patent law and trademark law in its current list of law firms 2023.

According to the editorial staff of Focus-Business, Kather Augenstein was recommended disproportionately often by clients and fellow campaigners, for which we would like to express our sincere thanks.

The complete list of recommended patent law firms can be found here.

The complete list of recommended law firms for trademark law can be found here.

Higher Regional Court Dusseldorf: No sufficiently secure legal existence of the patent for injunction after revocation of the parent patent in a generic drug case

Higher Regional Court Dusseldorf, decision of. 23 February 2023 – Ref. 15 W 14/21

In its decision of 23 February 2023 (Case No. 15 W 14/21), the 2nd Civil Senate of the Higher Regional Court Dusseldorf ruled that the grant of the patent for an injunction, which came about with the participation of a third party, does not justify an injunction even in a generic drug case if it is opposed by a revocation decision of the Opposition Division on the parent patent with the same content.

I. The facts

The Plaintiff in the injunction proceedings is the proprietor of the German part of a European patent on a pharmaceutical composition for the treatment of multiple sclerosis. A pending opposition has not yet been decided. The parent patent was revoked by the Opposition Division of the EPO in opposition proceedings brought by ten opponents, including the Defendant. The appeal against this decision was rejected by the Technical Board of Appeal. The revoked parent patent is largely identical in content to the patent in suit.

The Regional Court Dusseldorf dismissed the application for a preliminary injunction because the legal validity was not secured. The grant of the patent in suit and the decision of the Board of Appeal were in an irresolvable contradiction.

The Higher Regional Court Dusseldorf confirmed the decision of the Regional Court and dismissed the appeal as unfounded.

II. About the decision

The Higher Regional Court Dusseldorf ruled that a preliminary injunction based on a claim for injunctive relief under patent law can only be issued if the existence of the patent in suit can be answered so unambiguously that an erroneous decision is not seriously to be expected. In principle, this can only be the case if the patent in suit has survived opposition or nullity proceedings in the first instance.

An exception to this is made if there are circumstances in which the patent proprietor is particularly worthy of protection. This is usually the case. For while the damage caused by an injunction that has not been issued is often enormous and frequently irreparable in the event that the patent is subsequently upheld, an injunction that subsequently proves to be unjustified only has the effect that the opposing generic company has been temporarily and unjustifiably kept out of the market. In this case, the weighing of interests is clearly in favor of the patent proprietor, since the opposing generic company does not regularly have to take any economic risks of its own for its market presence.

The Higher Regional Court Dusseldorf admitted that this was such a generic product case and that, in principle, an order should therefore also be issued if there was no final certainty as to the legal status. However, in this case, the negative disputed decision on the existence of rights precludes the assumption of a secured existence of rights. This also applies to a parent or parallel patent if – as here – the arguments regarding the destruction of the property right can be transferred to the patent in suit. The issuance of the interlocutory injunction precludes the decision of the Opposition Division of the EPO, which, compared to the Examining Division, is the higher-ranking body and is technically competent.

Due to the given circumstances, a discussion of the ECJ decision of 28 April 2022, Case C-44/21 – Phoenix / Harting, according to which a restrictive case law that an preliminary injunction could only be issued after opposition or revocation proceedings in the first instance would violate Art. 9 (1) lit. a of Directive 2004/48, was not necessary.

Dr Melissa Lutz

Munich Regional Court: Specification of the requirements for the mutual willingness to license on the part of the patent proprietor and patent user

In its judgement of 17 February 2023, Regional Court of Munich I specified its FRAND case law in a legal dispute between GE Video Compression LLC and TCL Deutschland GmbH (File No. 21 O 4140/21).

In the legal dispute before Munich Regional Court I, GE Video Compression LLC asserted claims arising from a HEVC SEP. In this judgement, Munich Regional Court specified its requirements for the mutual willingness of the patent proprietor and patent user to grant/take a license in the FRAND negotiations and rejected TCL’s FRAND objection for lack of willingness to take a license.

Munich Regional Court I based its decision on Federal Court of Justice’s decisions FRAND-Einwand I and FRAND-Einwand II. The patent user has to continuously demand the conclusion of a FRAND license agreement and be willing to cooperate in the conclusion of this agreement. Without this willingness, the patent user’s FRAND objection would come to nothing. The patent proprietor must also be willing to grant a license in the negotiations. The behaviour of the patent user and the patent proprietor are mutually dependent. The benchmark of the assessment was what a reasonable party interested in the successful conclusion of the negotiations in a manner that was in the interests of both parties would do at a particular stage of the negotiations to promote this objective. The parties’ negotiating steps build on each other. If there was no willingness to take a license on the part of the patent user, it could be left open whether the patent proprietor’s offer (in substance) complied with FRAND conditions. The license seeker would only not have to respond to an offer by the patent proprietor if it was so contrary to FRAND that it was unacceptable in an objective assessment.

On this basis, Regional Court rejected Defendant’s FRAND objection.

Regional Court first examined whether Plaintiff’s offer was so contrary to FRAND that it was absolutely unacceptable and answered in the negative. In doing so, Regional Court examined the patent proprietor’s willingness to grant a license. As a rule, there was no willingness to grant a license if the patent proprietor insisted on discriminatory or arbitrary conditions and was not prepared to abandon these conditions even at the end of the negotiations. If a patent pool made a license offer for an SEP, the patent proprietor has to accept this offer against itself. The patent user has to present and prove that the offer is contrary to FRAND. In any case, he must present plausible evidence that an offer is discriminatory and why. In individual cases, the patent proprietor could be required to provide additional information on the offers due to his secondary burden of proof (sekundäre Darlegungslast).

On this basis, Regional Court found no concrete evidence that Plaintiff was unwilling to take a license.

In its judgement, Regional Court reasoned, inter alia, that Plaintiff did not have to plead comparative license agreements if the patent user had justified the discrimination on the basis of the “effective license burden”. In addition, it was decisive that there was no discrimination if Defendants concluded a license agreement on the same terms as those granted by Plaintiff to its competitors. However, Defendants had not sufficiently responded to this proposal. A willing licensee would have been obliged to do so.

Regional Court also showed that no discrimination could result from the settlement license agreements because they had been concluded “pre-litigation”. Such agreements are to be distinguished from license agreements that are only concluded after legal proceedings have been initiated.

However, Regional Court recognised Defendant’s unwillingness to take a license. It reasoned that the lack of willingness to take a license resulted in particular from the hesitant negotiations. In doing so, it distinguished between the conduct before the action was filed and the conduct after the action was filed.

In the period leading up to the filing of the action, Defendants had been unwilling to take a license, as they had not responded sufficiently to the pool’s attempts to contact them.

Even after the action was filed, they had not promoted the license negotiations to the necessary extent and had not compensated for the failures of the previous five years. This would contradict the declared willingness to take a license.

The overall conduct of Defendants showed their lack of interest in reaching a conclusion of the license agreement with the pool and Plaintiff quickly. In particular, Defendants did not present objections to Plaintiff’s offers and reasons against the fulfilment of FRAND conditions in a timely manner. Defendants pursued the goal of enforcing their own (financial) license conditions against Plaintiff and used delaying tactics. This is evident from the constant request for further information without any constructive use being made of the information provided. Even after the action had been filed, Defendants’ conduct did not show that they were concerned with a timely and reasonable conclusion of the license agreement, but that the unwillingness to grant a license had persisted. Defendants participated in the license negotiations too late and too little to compensate for the previous delays and omissions. Defendants’ counter-offers showed that they were not interested in concluding a contract on FRAND terms. They demanded conditions that were structurally and legally impossible for the pool, as the pool would otherwise be in breach of its statutes. The counter-offers were aimed at content that could not be accepted by the pool and that Defendants could not claim. A reasonable license seeker would not have tried so long and hard to enforce these conditions. Defendants should also have provided the pool with information about their sales figures. In addition, Defendants’ delayed reaction – inter alia in the counter-offer – showed that they had not been willing to take a license.

In addition, Plaintiff had made a bilateral offer to Defendants as an alternative to the pool offer. Defendants did not respond to this.

In its decision, Munich Regional Court also reasoned that the objection that Plaintiff or the pool breached its duty to promote was not valid. It was sufficient that Plaintiff or the pool had made license agreements available in a data room and had continuously updated and supplemented them. These contracts gave Defendants a first impression of the licensing situation. A willing licensee would formulate initial interests and key points of a license agreement on this basis and possibly request further information on the terms and conditions of its main competitors. In any case, a willing licensee would not request the submission of all patents and all license agreements without dealing with them in substance.

The Regional Court also reasoned that Defendant’s handling of the blackenings proved its unwillingness to take a license. On the one hand, the blackenings had not been unreasonable because, according to Defendants’ submissions, the passages provided did not contain any information relevant to the assessment of the license fee. In addition, Defendants had waited too long before filing an application for production.

The constant request for further information also proves the lack of willingness to take a license. Defendants should have dealt with the information provided and the information should have been reflected in new negotiating positions. Defendants had not complied with this. It follows from this that Defendants’ interest in clarification was only pretextual.

Further objections by Defendants did not change this either, as these objections had been raised too late.

Finally, Munich Regional Court ruled that defendants’ requests for production were unfounded. Since Defendants were unwilling to take a license, it was not necessary for Plaintiff to disclose further information and submit relevant documents. The submission was not relevant to the decision. It was not apparent that Defendants would abandon their dilatory behaviour as a result of the submission. Moreover, there was no claim to submission under antitrust law. In principle, Defendants were only entitled to the submission of contracts that affected the same market. They did not explain which contracts they needed in addition to those already submitted.

Dr Benedikt Walesch LL.M.

IAM Patent 1000 – Kather Augenstein anew among the world’s leading patent professionals 2023

We are pleased that Kather Augenstein has been selected again by IAM Patent 1000 The World’s Leading Patent Professionals as one of the world’s leading law firms in the field of patent infringement in the current 2023 edition.

The IAM Patent 1000 ranking focuses on law firms and individuals who are considered to have excelled in the key area of patent law. As with previous editions, for the 2023 rankings, IAM again conducted extensive qualitative research to identify the top law firms and individuals based on their extensive expertise, market presence and the complexity of their work.

We are delighted that our IP boutique is represented by no less than five experts in the top rankings. Congratulations to our name partner Dr Peter Kather as well our partners Dr Christof Augenstein, Miriam Kiefer LL.M., Christopher Weber and Sören Dahm, who are represented in the current ranking as proven experts in patent infringement.

A special thank goes to our team for their outstanding work and to our clients for their continued trust in us.

“Following this year’s nominations by IP Stars, top rankings by The Legal500 and Best Lawyers by Handelsblatt, this is a further recognition in 2023 that we and the whole team are delighted to receive,” added Miriam Kiefer, Managing Partner, Kather Augenstein.

The full online edition of 2023 can be found here.