De minimis – how low do you need to go?
What proportion of products must fall within the scope of the claims for there to be an infringement? Even if the number of infringements is not discounted as de minimis but is still small, what remedies are the court likely to grant? Some answers to these questions were provided by the judgment in Napp Pharmaceuticals Holdings Limited v Dr Reddy’s Laboratories ( EWHC 1517 (Pat)), which contains the most detailed discussion of the de minimis principle by the English patents court to date. The judgment is significant because it signals the willingness of the courts to recognise de minimis as a defence to patent infringement and therefore provides guidance on likely outcomes for future cases where disputed activities lie at the margins of a claim. On the facts of this case, the judge found 0.01% to be the cut-off below which infringements could be discounted as de minimis.
De minimis principle
As a general principle, the law does not concern itself with trifling matters, based on the Latin maxim de minimis non curat lex. Based on this de mimimis principle, it has been commonly understood that a defendant carrying out a triflingly small number of activities within the scope of a claim might avoid liability for patent infringement. However, the judge also commented that the application of the principle in the field of patent law has proved surprisingly controversial, noting that the previous cases often cited as authority for de minimis have failed to address it properly. Interestingly, the judge also referred to his prior application of the principle in the high-profile Lyrica case (Generics (UK) Ltd v Warner-Lambert LLC  EWHC 2458 (Pat)), noting that he did not consider the point in any detail and that his decision is under appeal. Perhaps the judge felt obliged to provide wider guidance on this point when presented with the opportunity to do so in the present case.
Napp argued that Sandoz and Dr Reddy’s had threatened to infringe its patent directed to a buprenorphine transdermal patch for use in treating pain in humans. The claims of the patent require that the patch include various components present at levels falling within specified ranges and Sandoz argued that the number of its buprenorphine transdermal patches that would fall within the claimed parameters was so small that it could be discounted as de minimis.
The calculation of the number of patches that would fall within the claims was complicated by the fact that the precision to which the claimed parameters should be read needed to be considered. In addition, because Napp was seeking an injunction, the action was being heard before any sales had taken place and so an insufficient number of patches had been produced and tested to allow an accurate picture of the number of patches falling within the claims to be established.
It was accepted by Napp that if one patch in a trillion fell within the scope of the claim, there would be no infringement. But Napp also argued that if larger, but still very small proportions of the patches were encompassed by the claims (eg, 200 patches out of 2 million, or 0.01%), there would be an infringement. However, the judge disagreed with Napp’s proposal, stating that “the skilled person would be very surprised by the proposition that selling products only 0.01% of which fall within the claim constitutes patent infringement”.
Interestingly, the judge noted a prior general warning from the Supreme Court against application of a numerical limit to the de minimis principle. Nevertheless, the judge felt bound by “reasons of practical reality” to decide where the de minimis line should fall in this particular case.
Following the construction of the claims, the proportion of patches that would be expected to fall within the claim was discussed. The findings of the statisticians from each party varied wildly. The appropriate confidence interval was considered by the judge to be 50% (a far cry from the 95% confidence intervals routinely applied) due to the fact that Napp had chosen to rely on a limited and imprecise data set when bringing its claim rather than waiting until after actual infringements had occurred. The 50% confidence interval was selected on the basis that infringement had to be demonstrated on the balance of probabilities.
Irrespective of the way in which the proportion of patches falling within the scope of the claim was calculated, both the best and worst-case scenarios were held not to infringe based on the de minimis principle. The best-case scenario for Sandoz, 1 in 69 million patches, was found to be “plainly de minimis” because it was not sufficient to lead to a probability of infringement by even a single patch before the expiry of the patent. Even 1 in 25,500 patches (the worst-case scenario for Sandoz) was considered to be de minimis.
Further, in view of a protocol for further manufacture proposed by Dr Reddy’s, the court felt compelled to set out explicitly what the limits of de minimis were. On the facts of the case, the line was drawn at 1 in 10,000 (0.01% – the exact value that Napp had argued as an example of a proportion that should be considered to be an infringement). Accordingly, there was found to be no threat by Dr Reddy’s to infringe because its planned testing regime and statistical protocol would ensure that it did not exceed the de minimis limit set by the court.
Although the judge found the proportion of patches that would likely fall within the scope of the claim to be de minimis, he considered the remedies that would be available to the court in a situation in which a small number of infringements are likely to take place, which are not discounted as de minimis.
The judge stated that the remedy of an injunction must be “effective, proportionate and dissuasive and must be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide safeguards against their abuse”. An injunction was considered unlikely to be granted where the levels of infringement are small but cannot be counted as de minimis, because to do so would be "disproportionate and a barrier to legitimate trade". Specifically, the judge concluded that the harm to the patentee from infringement on such a small scale would be indistinguishable from the harm caused by wholly non-infringing acts, and would require the defendant to operate even further outside the boundaries of the claim, effectively extending the patentee’s monopoly. Rather, a financial remedy was said to be more appropriate.
The willingness of the English courts to acknowledge the de minimis defence and to define numerical limits for its application will interest claimants and defendants alike. Further, the extent to which the courts are likely to grant an injunction in borderline cases may provide some comfort for third parties working at the fringes of a claim. The decision provides much-needed guidance on de minimis and fills a void in the English patents court’s jurisprudence. The decision has been appealed on an expedited basis, so the Court of Appeal may provide further guidance in due course. It will be interesting to see the extent to which the case is cited in future infringement actions in the English courts.
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