On 24 August 2023 the UPC Central Division (Section Munich) issued its first ever decision on a preliminary objection in the case No. UPC_CFI_1/2023.
The decision concerns the time of filing and admissibility of a revocation action at the Central Division when a parallel infringement action is filed at a local division (Art. 33(4) UPCA). Art 33(4) UPCA states that revocation actions and DNI actions shall be brought in the Central Division unless an infringement action between the same parties relating to the same patent “has been brought before a local or regional division”. The Central Division dismissed the preliminary objection, the grounds of the order have however not yet been published. Following the course of the oral hearing, the court decided that whether an infringement action had already been brought was to be assessed at the time of filing of the revocation action and that, as a result, the time of filing of the actions was critical for determining which action was brought first – every minute counts. The court also decided that where the CMS is unavailable (like on the first day of operation of the court), a revocation action can be physically filed also at the seat of the Registry in Luxembourg. The decision may only be appealed upon grant for leave to appeal.
Background
Case 01/2023 is the latest in a series of patent disputes between Sanofi-Aventis and Amgen, Inc. in various jurisdictions relating to Regeneron’s PCSK9 inhibitor, Praluent, and Amgen’s patents covering antibodies targeting specific epitopes of PCSK9. In this case the patent at issue is Amgen, Inc.’s EP 3 666 797, claiming antigen binding proteins for treating conditions related to raised cholesterol levels. On 1 June 2023, the first day of the operation of the UPC, Sanofi-Aventis filed a revocation action against EP 797 before the Central Division of the UPC, whilst Amgen, Inc. filed an infringement action against Sanofi-Aventis and Regeneron Pharmaceuticals before the Munich Local Division of the UPC. The cases are each valued at EUR 100 million.
Given on 1 June 2023, the UPC Case Management System (CMS) was not functioning properly and the actions could not be filed electronically, the claimant, Sanofi, filed the revocation action in hard-copy form pursuant to Rule 4(2) Rules of Procedure (RoP) at the Registry in Luxemburg. Receipt was registered at 11:26 am CET. Amgen, Inc., defendant in the revocation proceedings, filed their infringement action in hard-copy form at the sub-registry of the Munich Local Division. Receipt was registered at 11:54 am CET, about half an hour later than the revocation action.
Legal background
On jurisdiction, Article 33(4) UPCA states that revocation actions shall be brought before the central division. If, however, an action for infringement between the same parties relating to the same patent has been brought before a local or a regional division, these actions may only be brought before the same local or regional division. The Parties were in dispute over whether, for purposes of Art. 33(4) UPCA, the exact date and time of lodging the statement of claim is decisive or whether other requirements need to be met such as files being formally complete and/or whether it is the date and time when the action appears on the official register that matters.
A further dispute between the parties was whether filing of the revocation action at the Registry in Luxemburg was correct or whether the revocation action had to be filed at the Munich Central Division, so that the proper time of filing would only be the receipt of the revocation action by the Munich Central Division. Pursuant to Rule 4(2) RoP, where it is not possible to lodge a document electronically for the reason that the electronic case management system of the Court has ceased to function, a party may lodge a document in hard-copy form at the Registry or a sub-registry. An electronic copy of the document shall be lodged as soon as practicable thereafter.
Time is of the essence
The court decided that the exact date and time of lodging the claim is decisive when determining whether an action “has been brought” according to Art. 33(4) UPCA. With its decision, the court presumably confirmed its view presented in its preliminary opinion, given at the beginning of the public hearing on 17 August 2023. According to the court’s introduction in the hearing, it is a matter of determining on the facts which case was lodged first, because this criterion is clear, predictable, can be objectively assessed by the parties and the court and is in accordance with European Law. It is thus irrelevant when the case appears on the register and what date is attributed to it. Thus, time is of the essence when brining an action. In the current case, Sanofi, the plaintiff in the revocation action, beat Amgen, the plaintiff in the infringement action, by merely 30 minutes.
Place to file hard-copy submissions and the hierarchy of norms between the rules of procedure and the rules of registry
The focus of the dispute was on the question of whether Sanofi, the plaintiff in the revocation action, had lodged its complaint in the “right place” or whether it was to be assigned a later filing date and time as a result of filing at the “wrong place”. Sanofi had filed the hard-copy of its complaint at the Registry in Luxembourg.
Rule 4(2) RoP states: “Where it is not possible to lodge a document electronically for the reason that the electronic case management system of the Court has ceased to function a party may lodge a document in hard-copy form at the Registry or a sub-registry.”
According to Rule 3(2) Rules of Registry (RoR), “Paper documents and physical evidence may be submitted in person during opening hours of the competent division of the Court of First Instance or of the Court of Appeal.”
There was a lively debate at the oral hearing whether this meant that the paper copy of the revocation action had to be filed at the (sub registry) of the Munich section of the Central Division with the consequence that the filing date would have been the receipt of the revocation action by the Munich Central Division and the revocation action thus being inadmissible according to Art. 33(4) UPCA.
Arguments by the defendant in the revocation action/applicant of the preliminary objection
Amgen, the defendant in the revocation action, argued strongly that the plaintiff, Sanofi, did not lodge its hard-copy statement properly with the relevant Section of the Central Division in Munich. The plaintiff should have sent its representatives to Munich to file the statement there instead of to Luxembourg, because the legal framework did not allow filing hard-copy statements just anywhere or anytime. If filed in the wrong place, the submission only became effective when it is physically received in the right place. According to the defendant, Rule 3(2) RoR applied to everyone and was not overridden by the RoP. This was irrespective of the RoP having been adopted by the Administrative Committee whereas the RoR were adopted by the Presidium of the UPC (only). Amgen claimed this was very common in many legal systems, where a formal body makes the higher level of law, while smaller bodies with limited power issue more detailed regulations. The UPCA, the RoP and the RoR formed one legal framework with equal applicability, because the UPCA itself as the highest ranking body of law referred to both the RoP and the RoR, for example in Articles 2(i), (j), 10(4) UPCA and Article 24(1) of the Statute of the UPCA. Moreover, by filing its action with the Registry, Sanofi had actually filed not at the Central Division or even the Court of First Instance, but at the Court of Appeal, because the Registry mainly serves as the Court of Appeal’s Registry, in addition to being the only formal and non-substantive “umbrella” for all the other sub-registries, as can be seen in Rule 1(d) and (e) RoR.
The plaintiff’s arguments
Sanofi, the plaintiff, maintained that Rule 3(2) RoR was not binding on the parties, as the RoR were not mentioned in Art. 24 UPCA and only addressed the Registry. It also had no specific relevance for revocation actions. Rule 3(2) RoR aimed at other situations, such as the submission of physical evidence and of exhibits generally that could not be submitted via CMS. Sanofi also claimed that there was no “competent division” in the sense of Rule 3(2) RoR, yet, when filing a statement of claim, because the competent division was still to be established by the Registry under Rules 47, 17(2)(3)(a) RoP. In Sanofi’s view, the Registry was a supreme and substantive administrative body as shown by Art. 10 UPCA and Rules 4(2) and 44 RoP. In any case, Rule 4(2) RoP should be construed very broadly, without any limits, as it should assist the parties in extreme situations and not impose further hurdles. In general, the Central Division, as a specialist panel, should be the expected venue for revocation actions as a matter of policy and should not relinquish its competence to the local division but be confident about itself having jurisdiction.
Decision of the court
The Central Division rejected Amgen’s preliminary objection. The order rejecting the preliminary objection was uploaded to the UPC CMS where it however is not accessible to the public. It has not yet been published on the court’s website.
Analysis
The decision by the court (made by the judge rapporteur), is to be commended. It provides legal certainty to parties and so far as can be seen from the course of the oral hearing adopted a sensible approach to interpretation of the RoP and RoR.
Interestingly, the decision means that this case will continue to be bifurcated with validity being assessed by the Central Division’s Munich section and infringement being heard by the Munich Local Division. A very German situation and one that would have been completely different had Amgen filed its claim 30 minutes earlier.
Also, this case has brought some interesting insights into various aspects of UPC procedure. The question of admissibility was addressed in the frame of a preliminary objection according to Rules 48, 19 et seq. RoP. While not required by Rule 20(1) RoP, the court held an oral hearing to give the parties the opportunity to be heard as is possible under Rule 264 RoP. For this hearing, rules 105 and 106 RoP apply mutatis mutandis. The hearing took place by video conference (Rule 105 RoP) and was audio recorded (Rule 106 RoP). As foreseen in these cases, the judge-rapporteur, András Kupecz (NL), conducted the hearing, whilst the presiding judge, Ulrike Voß (DE), only participated as an observer. The judge-rapporteur reminded the parties explicitly of the possibility to reach an agreement at any point during the hearing (Rule 104(d) of the Rules of Procedure). During the hearing, the judge-rapporteur frequently asked specific questions to the parties (Rule 104(a) RoP), indicating which arguments he considered relevant for answering the legal questions. He allowed each party to respond to new arguments made by the other party. While it was planned to give each party 20 minutes to speak on the legal questions, in the end the discussion took more than twice as long, making the hearing last more than two hours instead of one. This is reassuring in that the parties will not be cut short by the court and will have the opportunity to make full use of their right to be heard.
Given the preliminary objection by Amgen, the defendant in the revocation proceedings, was dismissed, Amgen can only appeal it following the Court of First Instance granting leave to appeal (Rules 21(1), 220(2) RoP).
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