Wake Forest University Health Sciences & Ors v (Smith & Nephew Plc & Anor

The claimants are the proprietors of European Patent EP O 620 720 B2, which relates to a method of treating tissue damage in wounds. The particular kind of treatment is described as "negative pressure wound treatment" and, in effect, requires the creation of a vacuum over a wound and the covering of the wound within the vacuum by foam. The specification of the patent indicates that this method of treatment facilitates healing.

The claim is, in fact, not a claim to a method but a claim to apparatus, which is described in claim 1 of the patent as follows: "An apparatus for facilitating the healing of a wound, comprising vacuum means for creating a negative pressure on the area of the skin including and surrounding the wound and sealing means operatively associated with said vacuum means for maintaining said negative pressure on said wound by contacting the skin surrounding said wound, characterised in that said negative pressure is between about 0.01 and 0.99 atmospheres, and in that said apparatus comprises screen means for positioning at the wound within the sealing means for preventing overgrowth of tissue at the wound in which said screen means comprises an open-cell polymer foam."

There are then a number of subsidiary claims which add additional features to claim 1.

The treatment of wounds by means of this apparatus in which a foam is used is one of two methods of treatment, the other one of which involves the use of gauze. At the moment, the claimants have dominated the market in treatment with foam. They hold something of the order of 90 per cent of the market.

The defendants, Smith & Nephew, who are a multi-national pharmaceutical company, are in the market using gauze, and wish to break into the market for the use of foam.

There has been discussion between the parties and there have also been proceedings in the United States for the re-examination of certain patents in that jurisdiction in the light of prior art citations.

What induced the current application was an announcement by Smith & Nephew in December 2008 that new dressing kits would be launched in the first quarter of 2009. Those new dressing kits are the foam kits. In an email circulated to potential customers, Smith & Nephew said that the dressings would be available in early 2009. In those circumstances, the claimants have applied for an injunction restraining the entry into the market of Smith & Nephew until trial or further order. There is, in fact, a trial which relates to this patent due for hearing in July 2009. It is a claim for revocation brought by Molnlycke on a number of grounds, including insufficiency and obviousness in the light of prior art.

Smith & Nephew, however, have raised their own allegation of invalidity, partly anticipation and partly, no doubt, obviousness, based on a citation which is not raised in the current action brought by Molnlycke. The citation on which Smith & Nephew rely is a paper by Bagautdinov, published in Russia in 1986. It relates to the drainage of wounds with vacuum aspiration which promotes the outflow of tissue fluid. One of the questions I have to determine is whether there is a serious issue to be tried based upon that citation, which is whether the patent in suit is anticipated or is invalid for obviousness.

One of the points taken by Mr. Speck is that it is by no means clear on the evidence that the citation was made available to the public at or before the priority date of the patent in suit. The evidence is that it was in a public library within the Soviet Union and, I am bound to say, the suggestion that that was not available to the public seems to me to be a very weak suggestion. I will proceed, therefore, on the basis that it was something that was available to the public at or before the priority date. Nevertheless, reading that citation in the light of the patent, I am satisfied that there is a serious issue to be tried.

The claims of the patent refer to the screen means being positioned at the wound within the sealing means "for preventing overgrowth of tissue at the wound". It is, to put it no higher, by no means clear that the citation relied upon does deal with material which is suitable for the prevention of overgrowth of tissue. It may be, as Mr. Mellor suggests, that once the court is educated by experts, it will be seen that the prior citation does implicitly disclose such means, but to the, as yet, uneducated court, that is not clear. For the same reason, without the promised education, it is not clear that the invention is obvious over the prior art citation. I am, therefore, satisfied that there is a serious issue to be tried.

Both Mr. Mellor QC and Mr. Speck have urged upon me that damages would be an adequate compensation for each of their opponents. I am satisfied that each side is likely to suffer damage which would be difficult to quantify and is likely to be uncertain. This is, in my judgment, therefore, a case in which I must proceed to consider the balance of convenience in deciding whether or not to grant an injunction.

One of the important factors, as it seems to me, in considering the balance of convenience is the likely period of time for which the injunction, if granted, will last. As I have said, the Molnlycke trial is listed for hearing in July of this year. Mr. Mellor suggests that a trial of the current action, based upon an allegation of anticipation and/or obviousness and based upon a single citation of prior art, could be accommodated without undue difficulty in the list in March or April of this year.

Mr. Speck suggests that, although it is possible that this might happen, it would not be fair to the patentee to require it to rush into a trial and, in any event, he submits, there would be considerable overlap between an expedited trial of this case and the Molnlycke case. He suggests that there would be issues of construction of the patent which would or might overlap, and overlap in relation into common general knowledge.

I agree with Mr. Mellor that this is a case which is suitable for an expedited trial. It is relatively straightforward as patent cases go, and on the strict understanding that there is only one piece of cited prior art and that the allegations of invalidity relate to anticipation, obviousness over the single piece of prior art, and insufficiency only in so far as the allegations of insufficiency arise out of the cited prior art, I will direct that this trial be expedited to be heard as soon as possible after a date in March which can be discussed in due course.

It follows, therefore, on the basis that there will be a trial some time in or shortly after a date in March, the period for which the injunction will last, that the period for which the injunction will last is a relatively short one. I agree with Mr. Speck that that consideration points in favour of the grant of an injunction. The fact is that Smith & Nephew have not yet started in any significant way to sell the potentially competing products. Preservation of the status quo in cases where there is real doubt about what the future might bring is, as Lord Diplock said in the Cyanamid case, "a counsel of prudence", and it seems to me that the prudent course is the one I should adopt.

Mr. Mellor has relied on the relatively modest projections of profit produced by Smith & Nephew for the first few months of their projected sales programme but that, as it seems to me, cuts both ways. If, as he submits, little damage would be done to the claimants by allowing Smith & Nephew to proceed them equally, little damage would be done by deferring Smith & Nephew's entry into the market. I accept Mr. Speck's submissions that it would be rather more difficult to unpick the consequences of not granting an injunction at this stage but then granting one in three months time, or thereabouts, rather than trying to unpick the effect of granting an injunction now which is discharged in three months time. The reality is that the market would, at least to some extent, be changed by Smith & Nephew's entry, whereas there is much less cogent evidence that the market would be altered by the deferral of Smith & Nephew's entry.

In my judgment, the balance of convenience does come down in favour of preserving the status quo. In principle, therefore, I will grant an injunction pending trial or further order.

The grant of an injunction is, of course, conditional on the giving of a cross-undertaking by the claimant seeking the injunction. Two questions arise in relation to the cross-undertaking. The first is whether the cross-undertaking should extend to a claim for disgorgement of profits made by the claimants which would not have been made in the absence of the injunction. Mr. Mellor puts this point in one of two ways. First, he says that such a claim is maintainable on the form of the conventional wording of the cross-undertaking. Secondly, he says, if it is not, that then the conventional wording should be altered.

As to the first way of putting the case, I express no concluded view, although I believe that the decision of the Court of Appeal in the Apotex case is authority against that proposition. So far as the second is concerned, I decline to vary the standard form of undertaking. My principal reason for declining to do so is that it is by no means clear to me that it would be just to transfer a profit made by the claimant to the enjoined defendant. If the claimant has made a profit which it would not have made but for the injunction, there may be other people to whom it would be more just that those profits should be returned, either other potential competitors with the defendant or customers who, as things turn out, may have been overcharged.

That brings me, then, to the second question which arises on the cross-undertaking, namely, whether it should be given solely for the benefit of the defendants or whether the benefit of the cross-undertaking should be extended to others, notably, the customers of the claimants who, if the cross-undertaking comes to be enforced, will or may have paid too much for the services offered by the claimants during the pendency of the injunction.

I have come to the conclusion that the cross-undertaking should be framed in such a way as to allow customers of the claimants who have paid for the claimants' products and/or services covered by the injunction to claim the benefit of the cross-undertaking in the event that it comes to be enforced. A cross-undertaking is not usually capable of benefiting one who is joined to the action retrospectively, but in this case I will require the cross-undertaking to be drafted in such a way as to make it clear that a customer of the claimants may claim retrospectively loss suffered from the date of the grant of the injunction, that is to say, today, until the eventual discharge of the injunction, if it is ever discharged.