Saturday, 6 August 2011

Role of Foreign Precedents in deciding the outcome of a Patent Litigation


Ever wondered whether a determination by a foreign court over patent infringement will be considered or admissible in your local court? Does the jury get swayed by the decisions of foreign court in coming to a conclusion?

Patent infringement cases (territorial and extraterritorial) are pretty common nowadays and patent owners as well as product manufactures increasingly find themselves involved in patent litigation in local as well as foreign courts. It wouldn’t be far-fetched to say that patent litigation is slowly going “Global”. Patent owners and product manufactures are often busy pursuing legal battles with each other in many countries at the same time. As a result, patent owners need to be diligent more than ever in deciding which countries to file their patent applications and seek protection for their technology as well as in framing strategies for pursuing a patent litigation battle in local as well as foreign courts.

While the patent laws are jurisdictional, the inventions of today are international and are not bound by any borders. Traditionally, courts in the same country have often relied on issue preclusion (Collateral estoppel) to avoid re-litigation on an issue. The underlying rationale of issue preclusion is to prevent abuse of judiciary and ensuring that the parties involved in litigation are bound by the decisions of lower court. However, no such preclusion are defined when an issue has been resolved by a foreign court. There have been many cases in United States of America and European countries such as Germany, France and United Kingdom where the local courts have overruled the decisions of foreign courts. Thus, it should not come as a shock that courts from different countries have come to different conclusions and decisions in patent litigations that have involved the same product or patent in question. There have been a few cases as well where local courts have decided the outcome of a specific case by relying on rulings of foreign courts where the specific case has been already contested. A few such cases where foreign precedents have been considered and not considered are disclosed below:

Hilton v. Guyot: A landmark case in which the United State Supreme Court described the factors to be used when considering the application of comity and sovereignty. The Supreme Court concluded that if a foreign court has provided a full and fair trial and no evidence of prejudice or bias is present, then merits of such case can be relied upon by US courts.

Medtronic, Inc. v. Daig Corp: In order to prove obviousness, Daig Corp. had urged the court to adopt the conclusion of a German Tribunal that held the German counterpart of the patent obvious. However, the court did not agree with the recommendation and called the argument by Daig Corp as “specious”.

Cuno Inc. v. Pall Corp: This case involved simultaneous patent litigations that were being contested in US and UK court. The UK decided the issue first and ruled that Pall’s patent were valid and being infringed. Pall moved the US court for partial summary judgment and argued that relying on the findings of the UK court would shorten the trial and save valuable cost and money. However, the US court was reluctant to rely on the findings of UK court and stated that it collateral estoppel could not be applied based on foreign precedents as the patent laws and court processed were different.

Ditto, Incorporated v. Minnesota Mining & Mfg. Co: Ditto requested the US court to rely upon a decision of the West German Federal Patent Court which held the German counterpart of the patent as invalid. However, the US court stated that decision of the German patent court was not controlling on its own decision.

There have been many more such cases where some courts have shown the willingness to rely on foreign precedents whereas others have stated that foreign precedents can be relied on a persuasive basis but not as deciding or controlling means. Few such cases are mentioned below:


After analyzing the above cases it is clear that there is no definite answer to whether foreign precedents will be considered or admissible in US and European courts. Another important question that comes to my mind is with respect to handling of foreign precedents in countries where the number of patent litigation cases is not as high as it is in US and Europe. US and Europe have a huge number of precedents to rely upon in order to decide the outcome of a patent litigation. Their database is huge enough to cite their own cases to come to a conclusion. Do the courts in other countries such as Australia, India, Japan, Korea, Brazil, etc consider the foreign precedents? I have seen a few cases in India where foreign precedents have been considered during appeal proceedings. However, it was difficult to come to a conclusion whether foreign precedents would be admissible in Indian Courts.

Conclusion
Currently, various measures are being undertaken by patent offices from around the world to harmonize the patent laws and move towards a common set of patent laws to make matters easy for patent owners that are involved in patent litigation in multiple countries. However, the truth is that patent laws will continue to be jurisdictional by nature and each patent office will continue to have its own standards that it would rely on in coming to a conclusion on various aspects of a patent proceeding. Thus, foreign precedents should be considered on persuasive basis rather than on controlling basis.


Further read:
http://www.ipmall.org/hosted_resources/IDEA/39_IDEA/39-1_IDEA_107_McGarrigle.pdf
http://heinonline.org/HOL/LandingPage?collection=journals&handle=hein.journals/nyuilp27&div=20&id=&page=
http://www.kluwerlawonline.com/productinfo.php?pubcode=EFJ

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