UPC Weekly - Preliminary injunctions at the UPC – get your defence ready

2024 Week 18

This week we look at a recent UPC first instance decision for a preliminary injunction. The message being sent by the UPC to patent proprietors is clear. The UPC is ready and willing to grant preliminary injunctions. There is also a message that competitors need to hear: if you are concerned about a patent under the jurisdiction of the UPC, how prepared are you for the threat of a preliminary injunction?

A preliminary injunction was awarded on 30 April 2024 by the Düsseldorf Local Division of the UPC in 10x Genomics v. Curio Bioscience. Avid readers of these blogs may recall that there was a recent Court of Appeal case between the same parties, relating to a change of the language of proceedings from German to English, but that was after the hearing on the preliminary injunction application.

Following the guidance of the UPC Court of Appeal in another 10x case, the Local Division considered infringement and validity according to the balance of probabilities. As we have seen in other preliminary injunction applications, the court’s analysis was detailed, at least on the question of infringement.

The patent (EP 2697391 B1) relates to spatial detection of RNA or DNA in a tissue sample. However, the most interesting features of this case do not need any understanding of this technology.

10x argued that Curio’s Seeker Spatial Transcriptome Mapping Kit infringed both independent claims 1 and 14 of the patent. Claim 1 defines a method and claim 14 defines a product (an array on a substrate) suitable for a particular use. Of note is that claim 1 and claim 14 are not exactly parallel – claim 1 defines a series of steps that are not mirrored in claim 14.

The outcome of the court’s analysis was that claim 1 is probably not infringed by Curio but that claim 14 probably is. The court made it clear that their view about claim 14 was close to certain, at least based on the information available to them. 

The court took the opportunity to discuss the scope of protection and how the claims should be interpreted. The description of the patent certainly should be used in interpreting the claims, in particular those parts of the claims that discuss the purpose of different structural or method features of the claims. However, the court pushed back firmly against any suggestion that the file wrapper should be used for claim interpretation. There had been a previous decision by the Munich Local Division that used the A publication of the patent application to assist with claim interpretation. Maybe simply as a matter of judicial good manners, the Düsseldorf Local Division declined to criticise this approach, but did not endorse it.

Curio had raised objections to the validity of the patent based on four prior art documents and based on an added matter objection against claim 1. The court considered the disclosure of this prior art but decided that claim 14 is probably valid. They declined to consider the validity of claim 1. The decision of the court is notably light on explaining how inventive step should be assessed. As yet we do not have any clear guidance on whether the UPC will use the EPO’s problem and solution approach for inventive step, or some other approach.

On the substance of the case, the court were “sufficiently certain” that claim 14 is valid and infringed.  What was the effect of that?

The court granted the preliminary injunction to 10x based on the exact wording of claim 14. The preliminary injunction includes a requirement for Curio to make a penalty payment of up to Euro 100,000 for each contravention of the injunction per day. The court was persuaded that there could be irreversible damage to 10x’s market share without the preliminary injunction.

The timing of the circumstances of the case was also interesting. 10x persuaded the court that they had not known about the infringement of the patent before October 2023. Clear knowledge was established by 10 November 2023. The preliminary injunction application was filed on 4 December 2023.  The court said that filing the preliminary injunction application within 1 month of having all the knowledge and documents that reliably enable a promising legal action is fast enough to have acted with the required urgency.

Curio attempted to persuade the court that 10x should have known about Curio’s activities in the market far earlier in 2023, and therefore that 10x had not moved fast enough. However, on the evidence, this argument failed. Although there was plenty of evidence of Curio’s activities, there was no clear evidence of the awareness of 10x to these activities. The court accepted the assertion that Curio may have been flying under the radar in the market to some extent.

Curio also argued that, proportionally, their business would be damaged far more by the imposition of a preliminary injunction than the business of 10x would be by the lack of award of the injunction. The court considered this and agreed that this should be taken into consideration when weighing-up the interests of the parties. However, the court was sufficiently certain on the merits of the case:

The more convinced the court is that the right holder is asserting the infringement of a valid patent, …, the more justified the issuance of an injunction becomes.

10x requested security for costs (incurred and yet to be incurred) in case Curio would be unable to pay costs at the end of the proceedings. The court decided that this should not be applicable in provisional measures cases.

The court ordered 10x to make a security deposit of Euro 2 million. This is to protect Curio in the event that the court later revokes the preliminary injunction. The court was uncertain as to the amount to set for the security deposit.  In the absence of further information, the court based the amount on the value of the dispute asserted by 10x.

The court also made a decision on an interim award of costs. Oddly, the court decided that each party should pay the other Euro 100,000, which presumably means that no net payment is needed. However, this was a useful explanation from the court that an interim award of costs can be made in proceedings for a preliminary injunction. Each party had said that their costs were Euro 200,000 and the court decided that each side had only won half of their case, hence the Euro 100,000 figure.

Although the court considered the case to be a score draw in terms of the award of costs, it is difficult to see Curio being happy with the outcome of the case because they are now subject to a preliminary injunction.  This case illustrates the willingness of the court to award preliminary injunctions, although only after a relatively detailed consideration of infringement and validity. The claimant should act with suitable urgency, but the court is willing to allow significant time for the claimant to gather the relevant information and assess the case before filing the application for a preliminary injunction. 

On the other hand, the defendant is under exceptional time pressure to search for prior art and to pull together their argument for non-infringement and invalidity. It is becoming clearer and clearer that when a company knows that they may be at risk of infringing a patent under the jurisdiction of the UPC, they must take early action, at least to prepare the substance of their case for non-infringement and invalidity. This can be put on record in the form of a protective letter to try to avoid an ex parte preliminary injunction.