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Illumina, Inc. & Anor v Premaitha Health Plc & Anor  EWHC 615 (Pat) (19 March 2018)
 EWHC 615 (Pat),
 RPC 13
[Printable RTF version
||Neutral Citation Number:  EWHC 615 (Pat)
||Case No: HP-2017-000054 / HP-2017-000075
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY LIST (ChD)
||The Rolls Building
7 Rolls Buildings
London EC4A 1NL
B e f o r e :
MR. JUSTICE HENRY CARR
|| (1) ILLUMINA, INC.
(a company incorporated in the state of Delaware, USA)
(2) SEQUENOM, INC
(a company incorporated in the state of Delaware, USA)
- and –
||(1) PREMAITHA HEALTH PLC
(2) PREMAITHA LIMITED
|Defendants in Claim No. HP-2017-000054
||(1) TDL GENETICS LIMITED
(2) THE DOCTORS LABORATORY LIMITED
(3) ARIOSA DIAGNOSTICS, INC.
|Defendants in Claim No. HP-2017-000075
Transcript of the Stenograph Notes of Marten Walsh Cherer Ltd.,
1st Floor, Quality House, 6-9 Quality Court, Chancery Lane, London WC2A 1HP.
Telephone No: 020 7067 2900. Fax No: 020 7831 6864 DX 410 LDE
MR. IAIN PURVIS QC, DR. PIERS ACLAND QC (instructed by Powell Gilbert LLP) for the Claimants.
MR. THOMAS HINCHLIFFE QC and MS. GEORGINA MESSENGER (instructed by HGF Law LLP) for the Defendants Premaitha Health Plc and Premaitha Limited.
DR. MICHAEL TAPPIN QC and MR. JOE DELANEY (instructed by Herbert Smith Freehills LLP) appeared for the Defendant Ariosa Diagnostics, Inc. and (instructed by Clyde & Co LLP) appeared for the Defendants TDL Genetics Limited and The Doctors Laboratory Limited.
HTML VERSION OF JUDGMENT APPROVED
Crown Copyright ©
MR. JUSTICE HENRY CARR :
- This judgment concerns the following applications: (1) an application by Premaitha that the claimants' claim number HP-2017-000054, be struck out in its entirety as an abuse of process or, alternatively, be subject to summary judgment as against the first claimant, Illumina, on the basis that Illumina has no cause of action, because it is not the exclusive licensee of the patent in suit; and (2) similar applications brought by Ariosa and TDL in claim number HP-2017-000075.
- The actions concern alleged infringement of EP (UK) 1 524 321 B2 entitled "Non-invasive detection of fetal genetic traits" by the supply and offer to supply of Premaitha's IONA non-invasive prenatal diagnostic test ("NIPT"), and TDL/Ariosa's Harmony NIPT..
- The application raises two issues: first, alleged abuse of process by each of the claimants. The defendants contend that the commencement of the actions in respect of EP '321, which I will call the '321 actions, constitute an abuse of the court's process and should be struck out, because they could and should have been brought in one or other of two earlier sets of proceedings which were brought by the claimants for patent infringement in relation to the IONA test, and in an earlier set of proceedings, brought against TDL and Ariosa in respect of the Harmony test. Those proceedings were all decided by me following a trial in July 2017; secondly, issue estoppel as against Illumina. The defendants contend that the issue of whether Illumina is an exclusive licensee of the '321 patent has already been decided against it in the earlier actions and that, therefore, summary judgment ought to be entered against Illumina.
- I need now to set out some of the history of these various proceedings. In March 2015 the claimants commenced proceedings against Premaitha in relation to infringement by Premaitha's IONA test of two patents known as Lo 1 and Quake 1 (the first Premaitha action). In September 2015 the claimants commenced further infringement proceedings against Premaitha in relation to infringement by Premaitha's IONA test of a third patent known as Lo 2 (the second Premaitha action). Subsequently, a further patent, which was a divisional of the Quake 1 patent, known as Quake 2, was introduced into the first Premaitha action and another patent known as Lo 3, which was a divisional of Lo 2, was introduced into the second Premaitha action. In January 2016, the claimants commenced proceedings against TDL/Ariosa in relation to infringement by Ariosa's Harmony test of Lo 1 (the first Ariosa action).
Legal Principles – Abuse of Process
- I will now turn to the legal principles concerning Henderson v Henderson and abuse of process. In Johnson v Gore Wood  2 AC 1, Lord Bingham set out the basis of abuse of process in a frequently cited and very well-known passage at page 31:
"But Henderson v Henderson abuse of process, as now understood, although separate and distinct from cause of action estoppel and issue estoppel, has much in common with them. The underlying public interest is the same: that there should be finality in litigation and that a party should not be twice vexed in the same matter. This public interest is reinforced by the current emphasis on efficiency and economy in the conduct of litigation, in the interests of the parties and the public as a whole."
- He then went on to say:
"The bringing of a claim or the raising of a defence in later proceedings may, without more, amount to abuse if the court is satisfied (the onus being on the party alleging abuse) that the claim or defence should have been raised in the earlier proceedings if it was to be raised at all. I would not accept that it is necessary, before abuse may be found, to identify any additional element such as a collateral attack on a previous decision or some dishonesty, but where those elements are present the later proceedings will be much more obviously abusive, and there will rarely be a finding of abuse unless the later proceeding involves what the court regards as unjust harassment of a party."
- He then concluded:
"It is, however, wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive. That is to adopt too dogmatic an approach to what should in my opinion be a broad, merits-based judgment which takes account of the public and private interests involved and also takes account of all the facts of the case, focusing attention on the crucial question whether, in all the circumstances, a party is misusing or abusing the process of the court by seeking to raise before it the issue which could have been raised before."
- In a less well-known but nonetheless important passage in the judgment of Lord Millett at page 59, it was stated as follows:
"It is one thing to refuse to allow a party to relitigate a question which has already been decided; it is quite another to deny him the opportunity of litigating for the first time a question which has not previously been adjudicated upon. This latter (though not the former) is prima facie a denial of the citizen's right of access to the court conferred by the common law and guaranteed by Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms (1953). While, therefore, the doctrine of res judicata in all its branches may properly be regarded as a rule of substantive law, applicable in all save exceptional circumstances, the doctrine now under consideration can be no more than a procedural rule based on the need to protect the process of the Court from abuse and the defendant from oppression."
- The principles identified by Lord Bingham in Johnson v Gore Wood were summarised by Clarke LJ in Dexter v Vlieland-Boddy  EWCA Civ 14 at -. At  Clarke LJ said:
"(i)Where A has brought an action against B, a later action against B or C may be struck out where the second action is an abuse of process.
(ii)A later action against B is much more likely to be held to be an abuse of process than a later action against C.
(iii) The burden of establishing abuse of process is on B or C as the case may be.
(iv)It is wrong to hold that because a matter could have been raised in earlier proceedings it should have been, so as to render the raising of it in later proceedings necessarily abusive.
(v)The question in every case is whether, applying a broad merits-based approach, A's conduct is in all the circumstances an abuse of process.
(vi)The court will rarely find that the later action is an abuse of process unless the later action involves unjust harassment or oppression of B or C."
- I have already referred to the observations of Lord Millett concerning Article 6 of the European Convention on Human Rights. Whilst it is undesirable to cite numerous authorities in support of the same proposition, in this particular case this principle is of great importance. Therefore, I will refer to certain other authorities where judges have articulated, in slightly different words, a similar principle.
- In Stuart v Goldberg Linde  EWCA Civ 2,  1 WLR 823 at , Lloyd LJ cautioned against the striking out of genuine causes of action. He said:
"The cases on this aspect of abuse of process include many reminders that a party is not likely to be shut out from bringing before the court a genuine cause of action. That point is now underwritten by Article 6 of the European Convention on Human Rights, but I do not think that this Article changes English domestic law at all. It is consistent with the Article to allow the court to strike out a claim which is an abuse of process, but at common law it must be clearly shown to be an abuse before it can be struck out. The court must consider, critically, any suggestion that a particular cause of action should not be allowed to be asserted because of the bringing of another proceeding based on a different claim."
- In Clutterbuck & Others v Cleghorn  EWCA Civ 137, Kitchin LJ summarised the position at . He said:
"The deputy judge was clearly conscious that he had to be jealous to ensure that a genuine claim could be brought and it would only be appropriate to strike out the claim as a Henderson v Henderson abuse in a rare or exceptional case."
- In Otkritie Capital International Limited & Others v Threadneedle Asset Management Limited & Others  EWCA Civ 274, Arden LJ cited at 29 a summary by Lord Neuberger in Henley v Bloom at paragraphs 25 and 26, in support of the proposition that the starting point is that a litigant can decide whom to sue and when unless an abuse of process is shown. Lord Neuberger said:
"25 …However desirable it may be for a party to bring all his claims forward in one go, the abuse principle, as the judgments in Stuart  1 WLR 823 underline, does not bar a claim simply because someone fails to raise a claim when he could have done so. The facts must be such that the second action amounts to an abuse of process before it can be struck out.
26 The importance of the general principle that every person with an arguable claim should be able to pursue it in court is enshrined in Article 6 of the European Convention. As Sir Anthony Clarke MR indicated in Stuart  1 WLR 823, paragraph 98, if the court is not satisfied that a claimant's attempt to raise his claim is actually abusive in the light of his previous failure to raise it, the claim cannot be barred from proceeding however desirable it might have been for the claimant to have raised it earlier."
- With these principles in mind I turn to the Stuart v Goldberg case, in particular at paragraphs 58-59. In these passages, Lloyd LJ considered the relevance of delay and failure to use reasonable diligence to the bringing of a second cause of action. In relation to delay, he said at paragraph 58:
"…I consider that delay of itself is not relevant to whether the second claim is an abuse of process. Delay may be met with a defence under the Limitation Act 1980, or an equitable defence such as laches. Absent any such factor, the mere fact that the claimant has brought his second claim late, but in time, is not relevant to the question whether bringing the new claim in a second set of proceedings is an abuse of process. Of course, things may have happened during the period of delay which are relevant, but nothing of that kind is relied on in the present case."
- In relation to failure to use reasonable diligence, he said as follows at paragraph 59:
"As for the relevance of a claimant's failure to use what the court might consider to be reasonable diligence in finding out facts relevant to whether he has a possible claim, it may be that this could possibly be relevant to the inquiry described by Lord Bingham, depending on the circumstances. On the other hand, it does not seem to me that there can be a general principle that a potential claimant is under a duty to exercise reasonable diligence, not yet having brought proceedings asserting a particular claim, to find out the facts relevant to whether he has or may have such a claim. Moreover, I do not see how it can be relevant at all that the claimant may have failed to use due diligence in attending to his own interests at the time of the transaction or the events giving rise to the claims asserted. Unless, on the merits, that is a complete and inevitable defence to the claim, it seems to me to be entirely irrelevant to the inquiry which is necessary under Johnson v Gore Wood &Co  2 AC 1. Nothing in Wigram V-C's observations in Henderson v Henderson 3 Hare 100 supports that. That, however, is the context of the master's comments on lack of reasonable diligence. If relevant at all, an inquiry as to any suggested lack of diligence on the part of the claimant would have to involve considering the circumstances of the particular claimant, including what knowledge he did have of the facts at any relevant stage, in order to decide whether he knew enough to put him on inquiry so as to try to find out more. In this context, as generally, it is also relevant that the onus is always on the defendant to show that the claimant's conduct is an abuse of process."
- Infringement of EP '321 is a different cause of action to those asserted in the first and second Premaitha actions and the first Ariosa action. This is not a case where the claimants have failed in their claims in previous proceedings, indeed they had a very considerable measure of success in those actions. It is not a case where the claimants are seeking to relitigate claims which they lost based upon new information. In those circumstances, where there is an attempt to relitigate, reasonable diligence in finding evidence and in raising arguments is, of course, of very considerable importance. Raising late a different cause of action can be an abuse of process. The Aldi guidelines to which I shall refer make clear that such a case is possible. However, there is clearly an arguable cause of action for infringement of the '321 patent and, in the words of Kitchin LJ, it would take a rare or exceptional case to deny the claimants their Article 6 rights in those circumstances.
- The defendants relied on what has become known as the Aldi guidelines, as set out by Thomas LJ in Aldi Stores Limited v WSP Group Plc  EWCA Civ 260,  1 WLR 748. Although the Court of Appeal allowed an appeal from a striking out on the basis of abuse of process by Jackson J, nonetheless it went on to consider the correct approach that should be adopted in future by a party who, during the course of a first set of proceedings, became aware of a cause of action which could be brought as part of those proceedings.
- Thomas LJ said at paragraphs 29 to 31:
"29. I also wish to add a word as to the approach that should be adopted if a similar problem arises in the future. In circumstances such as those that arose in this case, the proper course is to raise the issue with the court. Aldi did write to the court, as I have set out at paragraph 2(xiii), but not in terms that made it clear what the court was being invited to do. WSP and Aspinwall knew of Aldi's position and were before the court on numerous occasions; they did nothing to raise it.
30. Parties are sometimes faced with the issue of wishing to pursue other proceedings whilst reserving a right in existing proceedings. Often, no problem arises; in this case, Aldi, WSP and Aspinwall each in truth knew at one time or another between August 2003 and the settlement of the original action in January 2004 that there was a potential problem, but it was never raised with the court. I have already expressed the view that it should have been. The court would, at the very least, have been able to express its view as to the proper use of its resources and on the efficient and economical conduct of the litigation. It may have seen if a way could have been found to determine the issues applicable to Aldi in a manner proportionate to the size of Aldi's claim and without the very large expenditure that would have been necessary if Aldi had to participate in the trial of the actions. It may be that the court would have said that it was for Aldi to elect whether it wished to pursue its claim in the proceedings, but if it did not, that would be the end of the matter. It might have enquired whether the action against excess underwriters could have been expedited. Whatever might have happened in this case is a matter of speculation.
31. However, for the future, if a similar issue arises in complex commercial multi-party litigation, it must be referred to the court seised of the proceedings. It is plainly not only in the interest of the parties, but also in the public interest and in the interest of the efficient use of court resources that this is done. There can be no excuse for failure to do so in the future."
- Wall LJ and Longmore LJ both gave short concurring judgments in which they expressly agreed with what Thomas LJ had said and these have become known as the Aldi guidelines. These guidelines have been considered in a number of subsequent cases which affirm their general applicability and their mandatory nature as well as elaborating on what is required in order to comply with the guidance. However, subsequent cases made clear that the Aldi guidelines are not to be applied mechanistically. In Stuart v Goldberg Linde, Sir Anthony Clarke MR cited a passage from Thomas LJ's comments in Aldi to which I have referred and stated that he agreed with those views. He went on to say at :
"For my part, I do not think that parties should keep future claims secret merely because a second claim might involve other issues. The proper course is for parties to put their cards on the table so that no one is taken by surprise and the appropriate course in case management terms can be considered by the judge. In particular parties should not keep quiet in the hope of improving their position in respect of a claim arising out of similar facts or evidence in the future. Nor should they do so simply because a second claim may involve other complex issues. On the contrary they should come clean so that the court can decide whether one or more trials is required and when. The time for such a decision to be taken is before there is a trial of any of the issues. In this way the underlying approach of the CPR, namely that of co-operation between the parties, robust case management and disposing of cases, including particular issues, justly can be forwarded and not frustrated."
- Sedley LJ commented at paragraph 77:
"Secondly, as Aldi Stores Ltd case again makes clear and as Sir Anthony Clarke MR stresses, a claimant who keeps a second claim against the same defendant up his sleeve while prosecuting the first is at high risk of being held to have abused the court's process. Moreover, putting his cards on the table does not simply mean warning the defendant that another action is or may be in the pipeline. It means making it possible for the court to manage the issues so as to be fair to both sides."
- The Aldi guidelines, as will be seen from the passages which I have cited, are concerned with cases where the claimant knows of a second cause of action, but in the words of Sir Anthony Clarke "keeps it secret", and in the words of Sedley LJ, "keeps the claim up his sleeve". They are not concerned with cases where the claimant does not know that he has a second cause of action, even if he should have known.
Application of the Legal Principles – Abuse of Process
- I now turn to the application of those legal principles to the present case. The first proposition of the defendants is that the claim in respect of EP '321 could and should have been raised at the latest by the time of a case management conference in the first sets of proceedings in October 2016.
- The claimants' answer to this proposition is set out in the evidence of Mr. Burch, which I shall summarise as follows. Mr. Burch is an in-house patent attorney, who has worked for Illumina since 2007. He was the key individual in that he has primary conduct of the day-to-day management of the UK proceedings, and is responsible for providing instructions to the claimants' solicitors, Powell Gilbert. He alone identified relevant patents to assert against Premaitha and TDL/Ariosa including all of those patents, to which I have referred, which were the subject of the earlier sets of proceedings.
- Mr. Burch's evidence is that he first became aware of the existence of EP '321 on 24th May 2017. That was in the course of a conversation with a colleague at Illumina, in which Mr. Burch asked about developments such as continuations or divisionals in relation to a US patent, which provides a method of selective separation of DNA, including enrichment of foetal DNA in maternal samples. It was in relation to this topic that EP '321 was brought to Mr. Burch's attention. Having been told about EP '321 and reviewed the specification, Mr. Burch discussed its relevance with Powell Gilbert on the following day. Premaitha and Ariosa were then notified, very promptly, on 1st June 2017 of Illumina's intention to sue on EP '321. It is the claimants' case that Mr. Burch's lack of knowledge of EP '321 before 24th May 2017 meant that, as a matter of practical reality, it could not have been joined in the UK proceedings before that date.
- As to knowledge of EP '321 it is quite clear in my judgment that Sequenom, a claimant in the first set of proceedings, knew of that patent. Obviously they did as they owned the patent. Similarly, Illumina should have known about the patent as it was one of the few patents that were specified in the agreement which they claim gave them an exclusive licence in this field, the Pooled Patents Agreement. For that reason as well, Mr. Burch should have known about it.
- However, in order to appreciate that there was a cause of action for infringement of EP '321 against the defendants, an individual within the claimants would have needed to have considered the scope of its claims in the context of the Harmony and IONA tests, as marketed in the UK, and would have needed to conclude that there was sufficient evidence of infringement to bring proceedings in the English courts. In this regard, the facts, as between the Harmony and IONA tests, are somewhat different.
- As to the IONA test, all but one of the annexes to the particulars of infringement now relied on in the '321 action were also annexed to the particulars of infringement in the first or second Premaitha actions which had previously been brought. The additional annex is a specification sheet for the Ion Proton sequencing system which has been publicly available since 2012. Furthermore, the claimants had the IONA instructions for use by July 2015, which also contained prima facie evidence of infringement of the '321 patent. However, it is the case that until May 2017 no one within the claimants had considered the scope of the claims of the '321 patent in the context of the IONA test, as marketed in the UK. There is no suggestion on the evidence that this cause of action was deliberately held back by the claimants. It can fairly be said that the claimants ought to have known that they had a cause of action against the IONA test, as marketed in the UK, in respect of the '321 patent, but on Mr. Burch's evidence they did not know.
- There was no suggestion by Mr. Hinchliffe, on behalf of the Premaitha defendants, that the '321 patent was deliberately held back by the claimants and no such objection could be made on the evidence. In my judgment, there was no breach of the Aldi guidelines by failing to raise the '321 patent at the October 2016 case management conference and not seeking directions from the court at that conference, because the claimants had not appreciated that they had a cause of action in respect of that patent against the IONA test.
- The position in respect of the Harmony test is different. Mr. Burch's evidence is that he first appreciated that the Harmony test involved size-based enrichment of foetal DNA upon reviewing the Harmony test manual in May 2017. His evidence is that that manual was not made available to the public, because it required a particular product key, until January 2017, to be precise between the 3rd and 16th January 2017. He therefore explains that Illumina could not have formulated a claim against TDL/Ariosa, even if it had been aware of EP '321 from the outset, any earlier than January 2017.
- Mr. Tappin on behalf of the Ariosa defendants criticised that evidence on the basis of evidence put forward by the claimants in the United States in respect of a different patent with different claims. He argued that by combining the disclosure of two published papers, known as Sparks and Juneau, both of which concerned the Harmony test, the claimants had the information which they asserted in the United States to show an arguable case of infringement of a US patent by October 2016.
- The difficulty with this argument in my judgment is that it relies on evidence adduced in a particular context to infer that this would have provided sufficient evidence of infringement in a different context. According to Mr. Burch's evidence the information that enabled him to conclude that the UK Harmony test was an infringement of the '321 patent was the Harmony manual, which was not publicly accessible until January 2017. On the evidence before me, that is the earliest date that an allegation of infringement could have been made. In any event, Mr. Burch's evidence is clear that it was not until May 2017 that he and others, who were responsible for this litigation in the United Kingdom, appreciated that there was a cause of action in respect of the '321 patent against the Harmony test, as marketed in the United Kingdom. As with the IONA test, there was no breach of the Aldi guidelines by failing to raise the '321 patent at the October 2016 case management conference and to seek directions from the court, because the claimants had not appreciated that they had a cause of action in respect of that patent against the Harmony test. Nor, in my judgment, is there any question of a failure to comply with the Aldi guidelines by the claimants at the time of the pre-trial review in June 2017.
- At the suggestion of Allen & Overy on behalf of Premaitha it was agreed that the new action could not be accommodated within the July trial. Premaitha proposed, and Illumina agreed, that commencement of the new action be stayed until after the July trial. The new claim was served on 7th September 2017. There was, therefore, no point in asking the court for directions, as no directions were required in respect of that action in June 2017, the relevant directions having already been agreed.
- In relation to Ariosa, the Ariosa defendants contended that the new action in respect of the '321 patent would constitute a misuse of confidential information, namely use of the Product and Process Description served in earlier proceedings for the purpose of different proceedings, contrary to CPR 31.22.
- This gave rise to a protracted dispute involving application notices and evidence served by both parties. During the course of this dispute, the solicitors acting for the Ariosa defendants requested disclosure of documents in which they said privilege had been waived, and indeed indicated that cross-examination of witnesses from Illumina would be required. In the end, after several months, the allegation of misuse of confidential information was abandoned in November 2017. Again, there was no point in notifying the court of the proposed action in respect of the '321 patent and seeking directions for the trial of that action. Illumina could not commence proceedings whilst Ariosa was alleging that such commencement would constitute a breach of confidence.
Prejudice to Premaitha
- I now turn to particular aspects relied upon by Premaitha, which are said to give rise to an abuse of process. Premaitha contends that the claims of EP '321 give rise to exactly the same issues as arose in the first and second Premaitha actions, which I have already heard and determined. The common issues are said to concern size separation of DNA contained in samples of maternal plasma or serum. Claim 1 of EP '321 claims:
"A fraction of a sample of the blood plasma or serum of a pregnant woman in which, as a result of said sample having been submitted to a DNA extraction, followed by a size separation, of the extracellular DNA, the extracellular DNA present therein substantially consists of DNA consisting of 500 base pairs or less."
- The idea is to enrich the proportion of foetal DNA in the blood plasma by size separation.
- Size separation was referred to as one amongst numerous issues in the context of a squeeze between an infringement and validity that was advanced by Premaitha in respect of the Quake patents in the earlier proceedings. Professor Avent, whose evidence in this respect was not challenged, said that the techniques for enriching strategies only resulted in a modest increase in the foetal fraction, say from 5% to 7.5%. Professor Lovett agreed and the agreed common general knowledge, as recorded in my judgment at paragraphs 280 and 281, under the heading "Enrichment of foetal fraction" was as follows:
"These size separation strategies allowed for modest enrichment, perhaps increasing foetal fraction by 50%. This was relative, so a starting foetal fraction of 5% might be enriched to 7.5%. Other methods tried included fixing maternal leukocyte fraction by use of formaldehyde. However, this method was controversial and not generally accepted."
- The priority date of EP '321 is October 2003, some two and a half years earlier than that of the Quake patents in February 2006. It is, therefore, difficult to see how the common general knowledge in relation to enrichment of DNA by size separation in 2006 could be relevant to common general knowledge in 2003. Indeed, the finding that the majority of the circulatory extracellular foetal DNA has a relatively small size forms the basis of the invention of EP '321. Therefore, it seems to me that common general knowledge in October 2003, which would be relevant to the claim in respect of EP '321, will be distinct from that which was relevant to the Quake patents.
- In any event, I do not accept that the allegation of commonality of issues could constitute a case of abuse of process. This is not a case where I made findings which are collaterally attacked by a second action. In so far as Premaitha has researched its own size separation step, or the common general knowledge on size separation in the first action, this may save them some work in the second action, but it does not make the second action oppressive.
- Next Premaitha complains of prolonged commercial uncertainty. In particular, Dr. Little on behalf of Premaitha has served evidence which states that Premaitha has been involved in litigation with Illumina since March 2015, and that the EP '321 action will extend the period of commercial uncertainty for at least a further one to two years, which will deter its customers and adversely affect further investment. Premaitha complains in particular that it will now not be possible to try the claim in respect of EP '321 so that any appeal can be heard at the same time as the rest of the case in early 2019. I do not accept that any of this means the pursuit of the EP '321 action constitutes an abuse of process or amounts to harassment of Premaitha. In particular, Premaitha proposed, and agreed, that proceedings in respect of EP '321 should not be started until after the conclusion of the trial in July 2017. They then waited until the day that the defence was due before raising abuse of process. That I find very surprising. Premaitha could have served a defence in which the question of abuse of process was raised, and sought to have that question of abuse of process determined as a preliminary issue. They chose not to do so.
- They then delayed the hearing of the application for abuse of process, because of the availability of their chosen counsel at the time, Mr. Mitcheson QC. They were offered dates in December 2017, but suggested, instead, that the date in March 2018 was the first date that Mr. Mitcheson could do. In the event, Mr. Mitcheson did not appear and the case was argued by Mr. Hinchliffe QC with his customary skill and ability. That means as a result of choices made by Premaitha, there was a delay of nine months from June 2017, when the '321 action could have been commenced, until March 2018, during which time the '321 action could not be progressed, not least because a defence had not been served.
- The '321 action, the estimate for which was made by Allen & Overy as four days, could have been heard at first instance during those nine months and could already have been decided. If the EP '321 claim had been commenced in June 2017, as Illumina was proposing, then on Allen & Overy's estimate of a four-day trial, it would have been heard between about March and June 2018. There is no reason why any appeal from that decision could not have been heard at the same time as the main appeal in respect of the other five patents, which I have already given judgment in respect of.
- Furthermore, on this application, Illumina have stated that they would agree to expedition of the EP '321 action, and that a four-day trial, if expedited, could be heard, and I agree with this, between October or November this year. Premaitha resisted any suggestion of expedition on the basis that they would not be able to prepare their case in time. However, they have known of the claim in respect of the '321 patent since June 2017 and so should, by now, have a very good idea of what their defence to that claim is. In summary, Premaitha have complained about the prejudicial effects of delay but have not shown, and are not showing, any desire to progress the claim with any speed.
- Furthermore, a prudent company in Premaitha's position would have sought advice from a patent attorney prior to designing and marketing its IONA test to identify potential patents and pending applications that might be infringed. Premaitha knows more than anyone about its IONA test. However, it has not stated in its evidence that it performed any patent searches to identify relevant patents, and has not stated whether it was, in fact, aware of the '321 patent. If it was aware of the '321 patent, then it took a risk with its eyes open. If it did not perform patent searches, then it closed its eyes to the risk of infringement.
- Premaitha also complained that Illumina has sought to enforce its patents against a number of Premaitha's customers in the UK and elsewhere. This is said to have been detrimental to Premaitha in three respects: direct loss of business; loss of potential business; and the slowing down of decision-making. I do not consider this could constitute an abuse of process. Illumina is entitled to assert its patents against Premaitha's customers. This is true, not least because in the first action Illumina established that infringement was occurring. I do not consider that this has any relevance to commencement and continuance of the claim in respect of EP '321.
- Premaitha also complains about increased costs of the EP '321 action. It puts the costs of the EP '321 action as between £1.25 and £1.5 million. However, there is no suggestion that Premaitha would be unable to meet those costs, merely that the company's historical losses have been funded by a combination of new shares and debt, making each fund-raising round increasingly difficult to achieve. The complaint is rather that the EP '321 action will involve what is said to be a huge duplication of effort and could have been managed at much lower cost had the trial been heard in July 2017.
- However, if EP '321 had been raised earlier, it would certainly not have been tried in July 2017. In that case, there were five patents in issue. I can say with the benefit of hindsight that that was far too many patents for one trial. A sixth patent, as I think was recognised at the time, would have made the trial completely unmanageable. The trial of the EP '321 action would, in my judgment, have been hived off had it been possible to progress it at the time. It is not uncommon in patent cases, and indeed often inevitable, to have sequential trials of different patents. This does not necessarily result in duplication. In the present case, where in my judgment the issues were distinct, there would have been no reason not to hive off the '321 patent.
- In any event, I consider that the costs of the EP '321 action will be considered once the result of that action is known at the end of the case. If Premaitha is successful, it will recover any additional costs that it may have incurred by the delayed claim. Even if it is not successful, it is the case that Allen & Overy sensibly reserved Premaitha's position in relation to increased costs. It may well contend that, even if it loses, any increased costs caused by delay in bringing the EP '321 proceedings, it should be entitled to in any event.
- Stepping back, I need to ask myself whether, in all the circumstances, commencement and continuance of the claim in respect of EP '321 against Premaitha constitutes an abuse of process, such that the claimants should be deprived of their Article 6 rights to a trial of an arguable case of infringement of the patent. The consequences of striking out the claim is that Premaitha will have effectively obtained a licence under EP '321 in respect of past and future acts of infringement which will not extend to any third parties. I have not found any conduct committed by the claimants which would justify this result.
Prejudice to Ariosa and TDL
- As to TDL/Ariosa, they contend that they reasonably believed that Lo 1 was the only patent relevant to the Harmony test. Since it expires in March 2018, they suggest that they made investment decisions based upon the understanding that after that date they would be free to market the Harmony test. However, the evidence of TDL is that it did not do any patent searches. Ariosa is a subsidiary of Hoffman La Roche, which is the largest global player in the in vitro diagnostics market and is actively involved in patent litigation, both in Europe and the United States.
- Ariosa's evidence is that it was not aware of the '321 patent but does not state whether or not it did any patent searches. Ariosa and Illumina are involved in patent proceedings in the United States, alleging infringement by the Harmony test of two patents which are owned by Illumina. There is a pending European equivalent of one of those patents. Ariosa must have been aware of this, so it cannot reasonably have been assumed that no further proceedings would be brought if and when that patent was granted.
- I do not consider, on the evidence, that TDL and Ariosa's belief that the only patent relevant to the Harmony test was Lo 1 was reasonable. Before concluding that the Lo 1 patent was the only patent relevant to the Harmony test, they needed to make themselves aware of all relevant patents and patent applications that might prevent the marketing of that test. There is no evidence that they did so.
- The other arguments advanced on behalf of Ariosa are as follows: first of all, duplication and additional expense; secondly, the possibility that senior scientists will be inconvenienced for a second time in drafting a PPD; and, thirdly, the additional imposition and strain that a further trial will have on the court's resources. I should state that all litigation causes general prejudice of this nature and general prejudice is not enough to support a claim of abuse of process. I do not accept that any of these considerations would lead to a finding of abuse of process by Illumina.
- Dealing with them specifically, I have already stated that it is extremely unlikely that a sixth patent would have been heard at the same trial as the other five patents, and therefore, a second set of proceedings was always highly likely, whenever the '321 claim was started. As a subsidiary of Hoffman La Roche, there is no suggestion that Ariosa cannot afford the costs and they may be entitled to recover any duplication of costs in any event. The extra work involved in providing a description of the size separation step seems modest given that a detailed PPD has already been prepared. As to the imposition of a further case on the resources of the court, Thomas LJ observed in Aldi stores at paragraph 24:
"I do not see how the mere fact that this action may require a trial and hence take up judicial time (which could have been saved if Aldi had exercised its right to bring an action in a different way) can make the action impermissible. If an action can be properly brought, it is the duty of the state to provide the necessary resources; the litigant cannot be denied the right to bring a claim (for which he in any event pays under the system which operates in England and Wales) on the basis that he could have acted differently and so made more efficient use of the court's resources."
- Having regard to all the circumstances, I conclude that the claim of infringement in respect of EP '321, as against Ariosa, is not an abuse of process.
- As to TDL, it has separate evidence concerning its position as a clinical laboratory. Dr. Levett is concerned about the commercial uncertainty that the action will give rise to. She makes a specific point about a tender to the National Health Service, which is to be filed by the 12th April 2018. I will avoid referring to the limited parts of that evidence in which confidentiality is continued to be maintained. Dr. Levett explains that the NHS is looking to reorganise genetic testing in England. The aim is to have seven laboratories in England for the processing of genetic tests on patient samples. It will include a three-year pilot programme for two laboratories to make NIPT available to pregnant women with a high risk of carrying a foetus with Down's Syndrome. The tender process for general genetic testing including NIPT was opened in late December 2017, with the submission date being 19th March 2018, which has now been extended to April. The NHS's aim is to have a decision on the successful bids so that they can be ready for implementation in October 2018, with a further aim of the NIPT service being available as soon as possible prior to October 2018. She explains that for the past three years TDL Genetics has been an active participant in a consortium that is intending to submit a bid in response to the tendering process, including offering NIPT through the Harmony test. She states that TDL Genetics has maintained its involvement in reliance upon its understanding that all patent infringement issues will be resolved by the Lo 1 action and by the expiry of Lo 1 in March 2018. She explains staff from TDL, including senior board members, have spent a significant amount of time following the NHS's consultation process since March 2015.
- She states that if the EP '321 action is allowed to proceed, TDL Genetics will be placed in a very difficult position because of the uncertainty it introduces, which will not be resolved until after its bid has been submitted in April, after which point it is committed to the process. She contends that even if TDL was to win the tender, but subsequently lose the EP '321 action and be taken off the market during the NHS pilot programme, that would seriously damage its reputation, as well as involving a significant loss of business in the market generally, particularly with the NHS.
- I do not accept that this is prejudice which could amount to an abuse of process by Illumina for the following reasons: First, even if Illumina had commenced its case in respect of EP '321 in 2016, any decision at trial would have been subject to a further appeal, which would still have been pending at the date of the tender. As I have said, this would have been heard at the same time as the rest of the appeals in early 2019. Therefore, the uncertainty at the time of the tender, and the possibility of subsequently being taken off the market, would have existed in any event.
- Secondly, if TDL was concerned about removing commercial uncertainty, then they should have got on with their defence to the EP '321 action as quickly as possible. They did not do so. They delayed the start of proceedings for seven and a half months, by making allegations of misuse of confidential information, which they eventually abandoned. Had they not taken this course, then the trial of EP '321 would have been concluded in time for it to be heard with the main appeal, and indeed, had TDL indicated any urgency, in time for it to have submitted its bid for the tender with that action having been decided.
- Thirdly, I have had regard to the evidence of Mr. Kempen concerning the eligibility of the Harmony test. Mr. Kempen explains at paragraph 17 of his evidence, which is offered on behalf of Illumina, that the Harmony test is an NIPT solution that runs on a microarray based platform, rather than a sequencing based platform. In relation to the provision of NIPT for the pilot programme, the NHS indicated during the first NIPT engagement day that it had a preference for providers that used sequencing based technology. In relation to an enquiry arising from the NIPT engagement day, as regarding eligible methodologies for tendering for the provision of the NIPT NHS services, NHS England have issued a formal response, on 6th February 2016, which states as follows:
"The eligibility criteria for the [Warwick] review did not specify the DNA quantitation methods (next generation sequencing or microarrays).
However, all NIPT services included in the evidence at the time of the review utilised next-generation sequencing technologies. Therefore, the Warwick review of evidence did not include assessment of any NIPT testing services using a microarray approach.
In light of this, only services using a next generation sequencing methodology are eligible to bid for provision of NIPT as an additional option on the NHS FASP screening pathway for Down's, Edwards' and Patau's syndromes."
- Mr. Kempen concludes that:
"It has therefore been apparent since at least June 2015 that the Warwick review only assessed next-generation sequencing technologies and that since February 2018 at the latest, the NHS had expressed a strong preference for sequencing based NIPT solutions for the NIPT pilot programme."
- He states that:
"It is therefore unclear to me why Dr. Levett believes that TDL has a very high prospect of bidding successfully for the NIPT part of the tender."
- Dr. Levett has served evidence in response to Mr. Kempen. Again, avoiding any passages which are now said to be confidential, she has explained as follows. She accepts that Mr. Kempen is correct that there is currently an issue over the eligibility of NIPTs using microarrays, such as the Harmony test, but points out that that issue has only recently arisen, in particular as a result of NHS England's 6th February response.
- She states that that conflicts, in her view, with the main tender documents. She explains that, throughout the bid preparation process, TDL has considered that the Harmony test is an eligible NIPT to base a bid upon. TDL also considers that the February NHSE response is incorrect. TDL contends that it is inconsistent with the bid instructions, and that it should not prevent them from submitting a tender, based on the Harmony test.
- So the current position, on the evidence, is that the Harmony test is not eligible for the tender, but TDL hope to change that position. I conclude that there is real doubt about the eligibility of this test for the NHS tender. The onus on this application is on TDL to establish an abuse of process, and in so far as this tender is relied upon, this onus has not been satisfied.
- Dr. Levett also complained about a waste of management time. This is general prejudice consequent upon any litigation. Insofar as TDL's management time is required for the EP '321 case it is unlikely to be materially different from the management time which would have been needed had all of these cases been heard together.
- Dr. Levett has also given evidence about the amount of money invested in the Harmony test. However, as I have said, TDL's evidence is that they performed no patent searches. I have dealt with the consequences of this earlier in this judgment: TDL's investment decisions do not mean that pursuit of the '321 action is an abuse of process.
- TDL also complains of a disruption to business continuity, the suggestion being that they could have transitioned to a sequencing platform earlier. This, as I understand it, ties in with concerns about TDL's prospect in the forthcoming tender in April, which I have already dealt with.
- In my judgment, pursuit of the '321 action against TDL is clearly not an abuse of process. I do not consider that this is a case where I should deprive the claimants of their Article 6 right to a trial in respect of an arguable case of infringement of the patent.
- I then turn to the defendants' application to enter summary judgment on the claim that Illumina is an exclusive licensee of the '321 patent, on the basis of issue estoppel. Considering first the law in relation to issue estoppel, in Arnold v National Westminster Bank  2 AC 93, Lord Keith of Kinkel said:
"Issue estoppel may arise where a particular issue forming a necessary ingredient in a cause of action has been litigated and decided and in subsequent proceedings between the same parties involving a different cause of action to which the same issue is relevant one of the parties seeks to reopen that issue."
- In Spencer Bower & Handley, Res Judicata Fourth Edition, it is explained at paragraph 8.01 that:
"A decision will create an issue estoppel if it determined an issue in a cause of action as an essential step in its reasoning. Issue estoppel applies to fundamental issues determined in an earlier proceeding which formed the basis of the judgment."
- It is further explained at paragraph 8.04 that:
"The determinations which will found an issue estoppel may be of law, fact, or mixed fact and law."
- The fact that a first instance judgment is under appeal does not mean that the judgment is not final in the sense required to set up an issue estoppel. This very well established principle is set out again in Spencer Bower & Handley at paragraph 5.19.
- Mr. Purvis QC, on behalf of Illumina, suggested that the judgment of the Court of Appeal in Unilin v Beheer cast doubt upon the principle that a first instance judgment, which is under appeal, is a final judgment. The decision in Unilin v Beheer was overturned by the Supreme Court in Virgin v Zodiac. I have considered that decision and, insofar as the argument which I was putting as counsel in that case can be understood, which I doubt, it does not cast any doubt upon the general principles set out in Spencer Bower.
- As to the facts, Illumina's cause of action in the first actions was for infringement of Lo 1, by virtue of an allegedly exclusive licence that it acquired by operation of the Pooled Patent Agreement. The issue of whether the Pooled Patents Agreement, and in particular clause 2.3(a), created an exclusive licence to Illumina was a necessary ingredient in deciding on Illumina's cause of action. I determine that the PPA did not operate so as to grant any such exclusive licence to Illumina. This was a legal determination involving construction of the PPA as well as application of section 130(1) of the Patents Act 1977. The difference in the actions in respect of EP '321 is that Illumina's cause of action is for infringement of EP '321. The issue about whether, in fact, the PPA operates so as to make it an exclusive licence is the same. So, in my judgment, there is issue estoppel in respect of this issue.
- It was explained at the hearing that a new exclusive licence has now been granted to Illumina, which cures whatever defects were held to exist in the first exclusive licence. That is not a reason, in my judgment, why Illumina's current claim, should be allowed to proceed. Illumina can of course apply to be joined as exclusive licensee on the basis of its new exclusive licence, which seems a very prudent course to have taken. However, it is no answer to the claim of issue estoppel.
- An alternative suggestion made on behalf of Illumina is that I should stay the defendants' application on this point, pending the outcome of the appeal in the first action, in which Illumina will be seeking to overturn the findings on the exclusive licence point. There is no point in staying this question, which has now arisen for decision. If the Court of Appeal considers that I was wrong in my conclusions in respect of the original exclusive licence, then of course certain costs consequences will follow and an appeal from this decision can, of course, be heard at the same time. For these reasons, I dismiss the defendants' applications to strike out the '321 actions as an abuse of process, but I grant summary judgment against Illumina, but not Sequenom, in respect of its claim to be an exclusive licensee. However, I make it clear that nothing in this judgment shall prevent Illumina from applying to join as a claimant in the '321 actions on the basis of a new exclusive licence.
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