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First UPC Court of Appeal case bleeds into 2024

The first oral hearing before the Unified Patent Court (UPC) Court of Appeal in Luxembourg ended on Monday without a judgment being issued, but the proceedings did offer businesses an insight into how other cases that come before the court might run, an expert in patent litigation who attended the hearing has said.

Amsterdam-based Stefan van Kolfschooten of Pinsent Masons said that it was clear from the outset that the UPC Court of Appeal was well prepared and was keen to take on an active role, posing a multitude of in-depth technical and legal questions to the parties. The UPC Court of Appeal also showed its willingness to hear a wide range of arguments pertaining to cases before it at the preliminary hearing stage – this has implications for parties involved in such proceedings.

Van Kolfschooten said: “The UPC Court of Appeal started the hearing by stating its preliminary opinion following pre-deliberations. While it might have been expected that this would have led to a targeted discussion on the issues pertinent to the decision, this court showed its willingness to hear all aspects of the case by elaborating on a wide range of topics of interest. As a result, the hearing highlighted that parties to proceedings before the UPC Court of Appeal should come well prepared with respect to all aspects of their case, as the court showed that it would not shy away from discussing any topic that may ultimately prove relevant to the parties or the court.”

The hearing concerned an appeal raised by US biotech company NanoString Technologies against a preliminary injunction awarded against it and in favour of patent holder 10x Genomics by the local division of the UPC in Munich, in September.

The preliminary injunction issued relates to NanoString’s CosMx Spatial Molecular Imager (SMI) products for RNA detection – technology that essentially helps medical researchers identify ribonucleic acid (RNA) in living cells.

One issue that became apparent in the appeal hearing was that NanoString had submitted a new document via the UPC’s case management system which it claims demonstrates that 10x Genomics’ patent is invalid, but that 10x Genomics had not been notified by the system that the document had been filed.

Rather than issuing a ruling on the admissibility of the document at this stage, the UPC Court of Appeal gave 10x Genomics time to review the document during the lunch break so that it could defend itself against the fresh claims in the afternoon session.

Similarly, the UPC Court of Appeal provided no ruling on whether an auxiliary request that 10x Genomics had filed before the Munich court was admissible in preliminary injunction cases – while it reserved the right to do so at a later date, it made clear that it wanted to have a discussion on the issue, both on the question of admissibility and in relation to the substance of the request. 10x Genomics was also urged to comment on the assertion that it seeks to rely on ‘added matter’ – information that was not included as part of the original patent application. Van Kolfschooten said the court’s intention to discuss these issues appeared to surprise the parties.

He said: “It may be that since we are at a nascent stage of UPC Court of Appeal proceedings that the court was in this case intent on discussing issues that may be beyond the immediate issues arising in this appeal, with a view to providing some guideline case law that may have application to other cases that come before the court. Nevertheless, it does reiterate the need for parties, for now, to prepare to discuss all aspects of their case at UPC Court of Appeal hearings.”

In the preliminary opinion, the Luxembourg court moreover commented on the burden and indication of proof and the threshold of evidence in preliminary measure cases.

Van Kolfschooten said: “In cases like this one where both parties have had an opportunity to make representations to the court, the UPC Court of Appeal made clear that the burden of proof will be on the applicant seeking a preliminary injunction to demonstrate that infringement has occurred. The UPC Court of Appeal further confirmed what the Munich local division had found in its first instance decision regarding the legal standard for the validity of the patent at issue. The Munich local division had found that for a sufficiently certain conviction of the validity of the patent in suit, a preponderance of probability is necessary, but also sufficient. This approach appears to suggest that applicants for preliminary injunctions in future cases will have to demonstrate a likelihood of ‘50% plus x’ in respect of the likelihood of validity of their patents.”

“On the question of proportionality and the balancing of interests in preliminary injunction cases before the UPC, the Court of Appeal said it would consider the potential harm to either party and that a decision would be based on the degree of the preponderance of evidence from either side. A slight preponderance of evidence in favour of infringement or invalidity for either party may be overshadowed by a high likelihood of certainty from the other party,” he said.

The UPC Court of Appeal said that it will not issue its judgment on NanoString’s appeal until the new year.

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