Background

Before addressing the law, the circumstances warrant specific consideration. In May 2013, Genentech was granted European Patent No 1,641,822B (the parent) for a specific antibody (anti-IL-17A/F) and its therapeutic uses (including the treatment of psoriasis). In February 2014, third parties commenced opposition proceedings before the European Patent Office (EPO) in relation to this parent with the Opposition Division concluding in October 2016 that it was invalid. Genentech appealed.

In July 2017, Eli Lilly commenced parallel proceedings against Genentech in relation to the parent before the Patents Court of England & Wales. The litigation was hard fought, with the combined legal fees reported to be in excess of £10 million (the trial judge, Mr Justice Arnold, observed “...this is one of the most complex patent cases I have ever tried (and I have considerable experience of trying complex patent cases)”). Ultimately, the court too concluded that the parent was invalid, albeit for different reasons to the Opposition Division (see Eli Lilly and Co v Genentech Inc [2019] EWHC 387 (Pat)). Genentech was given permission to appeal to the English Court of Appeal on its draft Grounds of Appeal (which address issues of law, not fact), with the appeal to be heard in 2021. However, in January 2020, between filing its appeal and the appeal itself the EPO Board of Appeal upheld the decision of the Opposition Division, revoking the parent ab initio. Formerly the English appeal was never withdrawn.

The basis for the findings of invalidity are relevant. The Opposition Division and Technical Board of Appeal found the parent invalid on the basis of added matter. This ground was argued before the English Patents Court, but Mr Justice Arnold rejected it. Rather, he found the parent invalid as follows:

• The antibody product claims (claims 1 and 2) lacked inventive step;
• The first medical use claims (claims 13, 14 and 15) lacked inventive step;
• The second medical use claims insofar as they related to rheumatoid arthritis (claims 12, 20 and 22) lacked inventive step; and
• The second medical use claims insofar as they related to psoriasis (claims 12, 20 and 22) lacked plausibility.

As to the latter, the court reasoned that it was not plausible to the skilled dermatologist reading the parent in conjunction with the common general knowledge at the parent’s priority date that an anti-IL-17A/F antibody would have some therapeutic effect for treating psoriasis. The emphasis is applied because, while Genentech initially defended the action on the basis that the parent was plausible at the priority date, it subsequently sought to amend its pleading to argue that the correct date for assessing plausibility was the filing date. This amendment was not allowed because, inter alia, it was sought too near the trial date. Genentech appealed that case management decision and the appeal was adjourned to the substantive appeal.

In July 2019, Genentech was granted European Patent No 2,784,084B, a divisional from European Patent No 1,641,822B. The parent and divisional were the same in all material respects, but the claims of the divisional were amended to address the added matter so fatal to the parent. Eli Lilly commenced proceedings before the English Patents Court asserting that the divisional was invalid. Genentech defended the action on the same basis as the parent except it submitted that, in relation to anti-IL-17A/F antibody and its therapeutic effect on psoriasis, this was plausible at the filing date (namely, the argument which it was prevented from making in relation to the parent). Eli Lilly considered that this issue could and should have been raised at the earlier trial and so sought summary judgment on the basis of issue estoppel and/or abuse of process (cause of action estoppel was not available because the divisional is formerly a separate property right).

The law

Broadly, issue estoppel is a form of res judicata. It applies where: “a. An issue has been determined in a final decision in an earlier action between the same parties; b. The issue determined in the earlier action must be fundamental to the earlier decision; and, c. The issue in the later action is the same as was finally determined in the earlier action.” Abuse of process is the principle that in a current claim a party may not raise an issue which could have and should have been raised in previous litigation.

In Johnson v Gore Wood, the House of Lords explained that the aim of these doctrines was to give finality in litigation. This was important because a party should not be twice vexed in the same matter. These doctrines are of particular relevance given the English Civil Procedure Rules’ emphasis (found in the Overriding Objective) to promote the efficient and economic conduct of litigation.

These doctrines are not, however, absolute. In particular, in Arnold v National Westminster Bank and Virgin Atlantic Airways v Zodiac Seats the House of Lords and then the Supreme Court emphasised that the doctrines should not work injustice. It follows that there will be special circumstances which warrant exemption.

Genetech’s arguments

Genentech made the following arguments against summary judgment:

• Genentech noted that the findings regarding lack of inventive step in relation to the parent were on the basis of two different pieces of prior art (in effect, the trial judge concluded "I find this patent to be invalid on each of the grounds, X and Y"). It submitted that this meant that there could be no issue estoppel as neither piece of prior art could be said to be fundamental to the decision reached.
• Genentech noted that it had been granted leave to appeal on lack of inventive step. This, it submitted, was on the basis that they must have a good prospect of success. It reasoned that if issue estoppel were to prevent Genentech from running the arguments on which it had a good prospect of success on appeal, this would create an injustice.
• Genentech argued that it was not an abuse of process to raise plausibility in the current proceedings.

Conclusion

Broadly, the court found against the first two of Genentech’s arguments, but found in its favour in relation to the latter argument. This meant that the court gave summary judgment on the claims of the divisional which were equivalent to those of the parent which had been found invalid for lack of inventive step. It did not, however, give summary judgment in relation to the claims of the divisional which were equivalent to those of the parent which had been found invalid for lack of plausibility. Rather, the action would proceed in respect of these, with Genentech entitled to argue that these claims were plausible at the filing date, not priority date.

With regard to the first argument, in the judge's view, this was a very important and far-reaching submission, particularly in the field of patents. In patent litigation, patents are frequently challenged on more than one ground, the trial judge will consider each pleaded ground of invalidity and this will frequently mean that a judgment of invalidity will be made on alternative grounds. If Genentech’s submission were correct, it followed that issue estoppel would rarely bite in patent proceedings. In the case at hand, the judge noted that, while there was no clear case law on the application of issue estoppel in such circumstances, appealability was one factor in deciding whether the determination was necessary to the decision or only collateral to it. He concluded that, as Genentech has appealed the findings of invalidity over both items of prior art, it followed that issue estoppel applied to both findings. As to the second argument, the judge said “I see some force in this argument but at this time this is only a possibility and its potential for causing injustice is outweighed by the certainty that a finding that issue estoppel does not apply would result in a rerun of the lengthy and expensive trial.”

As to the final argument, the judge held: “… I find that it is arguable that the effect of a finding of lack of plausibility at the priority date will only result in a loss of priority if plausibility can be established at the filing date. I also find that Professor Schön's evidence, which I allow in, establishes an arguable case that there was a change in the common general knowledge between the priority date and the date of filing, particularly as shown by the Lee et al. 2004 paper such that plausibility could be established at the filing date. … I conclude that [Genentech] has a real prospect of defending the claim that [those claims equivalent to those of the parent found invalid for lack of plausibility] were plausible at the filing date … on the basis that the common general knowledge had developed sufficiently between the priority date of the said patent and the [filing date] and therefore refuse summary judgment in respect of those claims ...”