Smith & Nephew Plc v Convatec Technologies Inc. T.J. Smith & Nephew Ltd and Another (Third Parties)

JurisdictionEngland & Wales
CourtChancery Division (Patents Court)
JudgeThe Hon. Mr Justice Birss,Mr Justice Birss
Judgment Date12 December 2013
Neutral Citation[2013] EWHC 3955 (Pat)
Docket NumberCase No: HP13B 00085
Date12 December 2013

[2013] EWHC 3955 (Pat)

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

PATENTS COURT

Rolls Building

7 Rolls Buildings

London EC4A 1NL

Before:

Mr Justice Birss

Case No: HP13B 00085

Between:
Smith & Nephew PLC
Claimant
and
Convatec Technologies Inc.
Defendant

and

(1) T.J. Smith & Nephew Ltd
(2) Smith & Nephew Medical Ltd
Third Parties

James Mellor QC and Charlotte May (instructed by Bristows LLP) for the Claimant and Third Parties

Piers Acland QC and Tom Alkin (instructed by Bird & Bird LLP) for the Defendant

Hearing dates: 12th – 15th, 18th, 26th November 2013

Approved Judgment

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

The Hon. Mr Justice Birss Mr Justice Birss
1

The question in this action is whether Smith & Nephew's Durafiber Ag product infringes Convatec's European Patent (UK) No. 1,343,510 entitled "Light Stabilized Antimicrobial Materials". The patent is concerned with the silverisation of gel forming fibres used in wound dressings.

2

This is the second time I have had to consider this patent at a trial between these parties and the third time I have had to consider a patent dispute between Convatec and Smith & Nephew about Durafiber.

3

Convatec have a wound dressing product called Aquacel. It is based on gel forming fibres made from carboxymethyl cellulose (CMC). It has been a major success both commercially and medically. Smith & Nephew wish to sell wound dressings which compete with Aquacel. Instead of using CMC, the gelling fibres in Durafiber are based on cellulose ethyl sulphonate (CES). Durafiber Ag is a version of the Durafiber product which contains silver as an antimicrobial agent. The silverised version of Aquacel is called Aquacel Ag.

4

At the first trial Convatec contended that Smith & Nephew's Durafiber product infringed three Convatec patents (EP (UK) 0 927 013, EP (UK) 1 085 912 and EP (UK) 0 616 650) and was the result of a misuse of confidential information on the part of Smith & Nephew's supplier of the CES fibres. By the trial the confidential information claim and the 912 and 650 patents had fallen away one way or the other. The only issue remaining was about the 013 patent. I held that Durafiber did not infringe a valid claim of that patent ( [2011] EWHC 2039 (Pat)). That conclusion was upheld in the Court of Appeal ( [2012] EWCA Civ 520). The result of that first action is that Smith & Nephew are free to make and sell Durafiber in the UK.

5

The first trial did not address silverisation. In parallel with the first action, Smith & Nephew started an action to revoke Convatec's silverisation patent No. EP (UK) 1,343,510. That led to the second trial. At the second trial I held that Convatec's 510 patent was valid ( [2012] EWHC 1602 (Pat)). That conclusion was upheld by the Court of Appeal ( [2012] EWCA Civ 1638). The outcome of the second trial was a blow to Smith & Nephew. They had developed a process for making silverised Durafiber and had obtained CE mark regulatory approval to sell that product in the EU but the manufacturing process infringed (or at least risked infringement of) the 510 patent. So after my judgment was handed down in June 2012 Smith & Nephew developed a new process which they thought would not infringe and in January 2013 they began this action for a declaration of non-infringement of the 510 patent. Convatec counterclaimed alleging infringement and the action has now come on to trial.

6

The claim I need to consider is the same as the one considered at the previous trial. It is:

1. A method of preparing a light stabilized antimicrobial material, characterised in that the method comprises the steps of:

(a) preparing a solution comprising an organic solvent and a source of silver in a quantity sufficient to provide a desired silver concentration in said material;

(b) subjecting a material which includes gel-forming fibres containing one or more hydrophilic, amphoteric or anionic polymers to said solution for a time sufficient to incorporate said desired silver concentration into said polymer, wherein said polymer comprises a polysaccharide or modified polysaccharide, a polyvinylpyrrolidone, a polyvinyl alcohol, a polyvinyl ether, a polyurethane, a polyacrylate, a polyacrylamide, collagen, or gelatin or mixtures thereof; and

(c) subjecting said polymer, during or after step (b) to one or more agents selected from the group consisting of ammonium salts, thiosulphates, chlorides and peroxides which facilitate the binding of said silver on said polymer, the agent being present in a concentration between 1% and 25% of the total volume of treatment, which material is substantially photostable upon drying, but which will dissociate to release said silver upon rehydration of said material.

7

The first issue I have to decide is the meaning of the phrase "the agent being present in a concentration between 1% and 25% of the total volume of treatment". There are two points arising: the scope of lower boundary of the claim and the meaning of "total volume of treatment".

8

On the lower boundary there are three possibilities. Convatec's primary case is that the claim would be understood as requiring rounding to the nearest whole number and so anything more than 0.5% is caught. Smith & Nephew's primary case is that the claim "means what it says" and anything less, for example 0.9999%, is outside the claim. Smith & Nephew's fall back is that 1% is expressed to one significant figure and so anything greater than or equal to 0.95% is covered. This argument about the lower boundary of the claim did not arise at the previous trial and the judgment does not rule on the matter. There was no (or no clear) suggestion at the first trial that the lower limit was anything other than 0.95%.

9

Total volume of treatment is dealt with in paragraph 48 of my previous judgment. Smith & Nephew submitted that paragraph 48 meant that the construction they contend for on this occasion had been accepted. There is some force in that submission but I prefer to rule on the meaning of the patent rather than having a meta-debate about the meaning of my previous judgment, where the point was not clearly decided.

10

Once I have decided the issues of construction there are two infringement questions. The first is about the process Smith & Nephew now wish to use commercially. In this method the relevant agent (sodium chloride) has a concentration of 0.77%. Clearly this only infringes if the boundary of the claim is 0.5%.

11

The second issue only matters if the boundary of the claim is 0.95%. The issue is about Smith & Nephew's development work. In that development work Smith & Nephew carried out certain development experiments which were used to make product to be used to generate data to be used to obtain regulatory authorisation to sell the product. Smith & Nephew did not contend these experiments were the subject of the experimental use exception to patent infringement in s60(5)(b) of the 1977 Act. The experiments have been given numbers. The relevant ones are 40, 43, 44 and 48. Convatec contend that the experiments used a salt concentration at a level more than 0.95% and therefore within the claim. Smith & Nephew contend that in fact, when considered properly and taking into account a phenomenon called "carryover", all the runs of these experiments were at a lower salt concentration, outside the claim. I need to resolve that factual dispute.

12

Finally I need to resolve the question of springboard relief. This only arises if the claim boundary is 0.95% and if the development experiments infringed the patent. If so then Convatec contend that since Smith & Nephew obtained CE mark approval for Durafiber Ag using data generated as a result of those experiments, it follows that they obtained that regulatory approval by infringing the patent. Smith & Nephew are only able to launch Durafiber Ag today in the EU as a result of having that approval. What ought to have happened, say Convatec, is that Smith & Nephew ought only to have been in a position to apply for CE mark approval in January 2013 and that the approval process would have taken until September 2014 to complete. So even though selling Durafiber Ag today would not infringe the patent (on the relevant premise) nonetheless Smith & Nephew should be restrained from selling Durafiber Ag until September 2014 in order to prevent them from deriving an unfair profit from their infringement.

13

Smith & Nephew deny all this. They contend that no such injunction should be granted at all and they challenge the dates proposed by Convatec. Convatec submit that even if the injunction should not last until September 2014, depending on my findings a springboard injunction of even as little as two months duration should be granted. Given the very high value of the market for these products, arguing about an injunction for only two months is worthwhile from each side's point of view. The market for Aquacel (which I recognise is not just Aquacel Ag) in the UK alone was said in the first action to be worth £17 million per year.

The witnesses

14

As before I heard technical expert evidence from Prof Kennedy (called by Convatec) and Prof Burrell (called by Smith & Nephew). Their backgrounds are explained in my previous judgment.

15

Smith & Nephew said that Prof Kennedy's evidence lacked objectivity, referring to his "resolute adherence" to the nearest whole number construction of the patent, his "dogged resistance" on carryover, and an episode in which Smith & Nephew submit he "flushed red in the face (an indication that he suddenly realised he had been caught out)" when confronted with a change in his evidence about the total volume of treatment.

16

Convatec's cross-examination of Prof Burrell put to him that he had...

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