Merck Sharp & Dohme Group v Hovid Berhad (02(f)-53-07/2018(W))

1.

MERCK SHARP & DOHME (MALAYSIA) SDN BHD (Company No. : 60181-P) … APPELANTS AND HOVID BERHAD (Company No. : 58476-A) … RESPONDENT [In The Matter of Court of Appeal of Malaysia at Putrajaya

Merck Sharp & Dohme Group 2. Merck Sharp & Dohme (Malaysia) Sdn Bhd (Company No. : 60181-P) … Appellants And Hovid Berhad (Company No. : 58476-A) … Respondent] 2 CORAM TENGKU MAIMUN BINTI TUAN MAT, CJ AHMAD BIN HAJI MAAROP, PCA RAMLY BIN HAJI ALI, FCJ MOHD ZAWAWI BIN SALLEH, FCJ NALLINI PATHMANATHAN, FCJ MAJORITY JUDGMENT TENGKU MAIMUN BINTI TUAN MAT, CJ MOHD ZAWAWI BIN SALLEH, FCJ NALLINI PATHMANATHAN, FCJ INTRODUCTION [1] The single legal issue that falls for consideration in this appeal is whether the adjudication of an independent claim as invalid, automatically renders claims which are dependent on the independent claim invalid, without the need for the court to consider separately the validity of each and every dependent claim(s). [2] This issue, which comprises the sole leave question, arises as a consequence of the decision of this Court in SKB Shutters Manufacturing Sdn Bhd v Seng Kong Shutter Industries Sdn Bhd & Anor [2015] 6 MLJ 293 (“SKB Shutters”). In that case, this Court 3 held that in the event an independent claim is held to be invalid, the only way dependent claims can survive and stand, if at all, is if the dependent claims are redrafted to incorporate the features of the claim upon which they are dependent and are made an independent claim. In short, the dependent claims cannot survive when the claim upon which they are dependent is invalid. As such, upon the independent claim being held invalid, all the dependent claims automatically fall. [3] The practical effect of this ruling, which is binding on lower courts, is that the trial courts need no longer determine the validity of dependent claims once the claims upon which they are dependent (i.e. the independent claims) are found to be invalid. [4] The Appellants contend that this approach is “uncertain, unjust or outmoded or obsolete in modern conditions”. They further contend that such a practice, namely the automatic invalidation of dependent claims upon the independent claim being held invalid is not consistent with patent practice in other jurisdictions globally, nor with accepted and established case law. [5] On 26.6.2018 leave was granted to the Appellants to essentially revisit the ruling in the SKB Shutters case. The Appellants’ contention is that even when an independent claim is held to be invalid, it does not automatically follow that dependent claims fall. Instead, the accepted practice, they maintain, is for the trial court to consider the validity of the dependent claims on the basis of the merits of each of these claims against the patentability requirements under the Patents 4 Act 1983. The basis for such a contention is that dependent claims, apart from including the features of the independent claim, may also have additional features. These additional features make the dependent claim’s scope of monopoly different from that of the independent claim’s. In order to appreciate this, it is necessary to comprehend the concept of independent and dependent claims. OVERVIEW OF THE CASE BEFORE US IN THE CONTEXT OF INDEPENDENT AND DEPENDENT CLAIMS [6] Both Appellants in the present appeal were the Plaintiffs at the High Court. They brought an action against the Respondent (Defendant therein) for patent infringement of their patent, Malaysia Patent No. MY-118194-A (“194 Patent”). The parties will be referred to as they were in the trial court for ease of comprehension. [7] The Plaintiffs claimed that the Defendant’s import, manufacture, offer for sale and stocking for the purpose of sale or offer for sale, alendronate 70 mg tablets had infringed their 194 Patent, as the first Plaintiff was, at the material time, the registered owner of the said patent pertaining to the alendronate dosing issue. [8] Under the patent, the first Plaintiff produced a pharmaceutical product of alendronic acid or a pharmaceutically acceptable salt (alendronate) under the trade name “Fosamax” to inhibit bone resorption in humans. The second Plaintiff is a Malaysian company which holds the exclusive licence from the first Plaintiff to distribute, 5 sell, and offer to sell Fosamax products in Malaysia. The Defendant, by way of defence, denied the alleged infringement and counterclaimed for a declaration that the 194 Patent was invalid on the ground that the patent exhibited no inventive step pursuant to section 56(2) of the Patents Act 1983 (“the Act”). [9] On 30.8.2016, the High Court dismissed the Plaintiffs’ infringement action against the Defendant and allowed the latter’s counterclaim for invalidation of the 194 Patent. The learned judge declared that the 194 Patent was invalid for want of inventive step. The Court went on to hold, and this is the significant aspect of the case, that as the independent claim was invalid, all dependent claims related to the 194 Patent fell. [10] The Plaintiffs appealed to the Court of Appeal. It unanimously dismissed the appeal. The Plaintiffs filed an application for leave to appeal to the Federal Court, which was granted, leading to the present appeal. It should be pointed out that the facts are of limited relevance because the primary finding of the trial judge on the invalidity of the 194 Patent independent claim is not challenged. [11] As stated at the outset, the sole question before us is whether it is correct to hold that the independent claim having fallen, all the other dependent claims also fall automatically as held in SKB Shutters. The Plaintiffs contend that it was incumbent upon the judge to consider the dependent claims separately in the trial before reaching such a conclusion. 6 PARTIES’ SUBMISSIONS [12] Counsel for the Plaintiffs submitted that the decision in SKB Shutters was wrong, uncertain, and/or unjust and therefore merits this Court’s departure. In justifying that claim, counsel submitted the following reasons:

The principle in SKB Shutters is inconsistent with the Act and Patents Regulations 1986 (“the Regulations”), and also with the previous understanding on the functions of independent or dependent claims;

Neither the Act nor the Patents Regulations 1986 provides for the principle established in SKB Shutters. The Act and the Regulations do not intend to treat dependent claims differently from independent claims (sic). Thus, the validity of dependent claims ought to be assessed and determined separately from the related independent claim(s);

The statutory grounds for invalidating a patent claim as provided under the Act do not distinguish an independent claim from a dependent claim;

The grounds for invalidating a patent claim under section 56(2) of the Act are exhaustive because of the term “shall”. None of the grounds stipulated an automatic invalidation of dependent claims once an independent claim falls; 7

The principle held in SKB Shutters was premised upon a misconceived understanding that unless a dependent claim is redrafted or amended into an independent claim, the dependent claims do not possess any legitimacy; and

The principle in SKB Shutters has a pervasive impact on patent claims which are already registered and/or filed and/or will be filed in the country. This ruling is contrary to the objective of the Act, in that, it will render dependent claims redundant. [13] Counsel submitted that the leave question be answered in favour of the Plaintiff and the matter be remitted to the High Court to determine separately and individually the validity of the dependent claims on the ground of obviousness or inventive step. [14] Counsel for the Defendants submitted at the outset that irrespective of the answer to the leave question, the invalidity of the 194 Patent would be undisturbed, and should remain invalid as held by the High Court. [15] Counsel for the Defendants also contended that the position in SKB Shutters is the correct legal position on the interdependency of independent and dependent claims. They also submitted that this position is also similar to that of other jurisdictions, eg: Singapore, Australia, UK and the European Union. 8 [16] Learned counsel also highlighted several points:

Not every claim would constitute an invention by itself. The dependent claims do not necessarily protect a new invention, it may relate to one invention only (sic);

It is acknowledged in case law that dependent claims do not reflect a proliferation of inventive concepts;

Regulation 19(3) of the Patent Regulations 1986 states that all dependent claims must claim specific forms of invention claimed in an independent claim. This, according to the learned counsel, is proof that a dependent claim is still reliant on the independent claim;

Regulation 19(3) makes reference to section 26 of the Act which provides that a patent application shall relate to either:-

one invention only; or

(ii) a group of inventions so linked as to form a single inventive concept

If there is only 1 invention and the court finds that it lacks inventive step, the entire patent would also lack inventive step because the claims both dependent and independent relate to the same invention. 9

By using the Windsurfing test which is the applicable test to determine whether a patent lacks inventive step, it is stated that the court will compare the differences between the invention and the Prior Art and decide whether the differences would be obvious;

It would be illogical if the court found the invention invalid after evaluating the independent claim, and arrived at a different conclusion when evaluating the dependent claims since all these claims relate to the same invention; and

It is on this basis that in a patent consisting of only 1 invention, when the independent claim is invalid, the dependent claims automatically fail. [17] Hence, counsel for the Defendant submitted that the principle that a dependent claim’s survival depends on the independent claim is the correct principle in the context of a patent containing 1 invention only. OUR ANALYSIS AND DECISION [18] In determining the question of law in this present appeal before us, we are of the view that it is pertinent to look at the basic tenets of patent law. We shall begin by looking at the concept and definitions of independent and dependent claims. This is in order to comprehend the interdependency of these claims and whether or not the treatment of 10 these claims is in line with the legal approach taken by the courts in SKB Shutters. [19] We shall also examine the form of patent claims as well as the different types of claims in a patent application to determine whether the blanket rule developed in SKB Shutters is justified. [20] We shall examine the position in other jurisdictions namely, the United Kingdom and the US, in relation to:

the effect of the different forms of claims on the issue of interdependency;

the different types of challenges available to oppose patent claim validity; and

how these claims and challenges are dealt with and adjudicated upon . [21] We shall then provide our analysis on SKB Shutters and the Australian case of E I Du Pont De Nemours & Co v Imperial Chemical Industries Plc & Anor (2007) FCA FC 163 (“the Du Pont” case). [22] Finally, we shall clarify the position of amendment of claims in Malaysia under the Act. 11 THE CONCEPT OF AN INDEPENDENT AND DEPENDENT CLAIM [23] The grant of a patent for an invention is the grant to the patentee for a limited period of a monopoly right in respect of that invention. (See Terrell on the Law of Patents, 15th edition). The boundaries of the monopoly over that certain invention would be enumerated through claims. Claims are generally drafted in two distinct forms: namely independent claims and dependent claims. It is pertinent to consider the concept of both an independent claim and a dependent claim to fully grasp the underlying relationship between the two. [24] The concept of an independent claim is that it is normally the claim defining the broadest penumbra of monopoly. On the other hand, a dependent claim defines a narrower scope of monopoly. This is illustrated in the case of Generics (UK) Limited (t/a Mylan) v Warner-Lambert Company LLC (No. 2) [2016] RPC 16 (“Generics”), at para 9: “Most patents contain one or more independent claims together with subsidiary claims with additional features. As progressively more features are included in the subsidiary claims, so the scope of the monopoly narrows.” (emphasis ours) [25] Jeffrey A. Lefstin writes, in support of Generics, in his article ‘The Formal Structure of Patent Law and the Limits of Enablement’ (2008) 23 Berkeley Technology Law Journal 1141, 1145 (fn 17): 12 “The practical motivation to construct hierarchies of successively narrower claims is to ensure that some claims remain valid. If broad claims are invalidated because it is later discovered that they read upon the prior art, or are too broad in light of the patentee's disclosure, the patentee may be able to fall back on narrower dependent claims that are still valid. Because narrower claims encompass less subject matter, they are less likely to encompass prior art or subject matter that the patentee did not enable or describe.” [26] In other words, if a claim were constructed so as to be too broad, then it would likely cover inventions already disclosed by Prior Art or prior publications. This would make the claim more susceptible to validity challenges. On the contrary, if a claim were to be too narrowly constructed, the scope of monopoly afforded to the patentee would be negligible and would not be practical as no one would infringe the patent (See Gillette Safety Razor Company v Anglo-American Trading Company Ld [1913] 30 RPC 465, at 480 per Lord Moulton). 13 [27] Figure 1 below illustrates the hierarchy of claims of which Lefstin describes: [28] The parts of the inverted pyramid represent the scope of each claim. The independent claim has the broadest scope of monopoly and the dependent claims have narrower scopes of monopoly. [29] In terms of invalidity proceedings, the invalidity of the Independent Claim would only nullify the top part of the pyramid but leave the dependent claims unaffected. Similarly, if Dependent Claim 3 were to be invalidated, then Dependent Claims 1 and 2 along with the Independent Claim would collapse as well. [30] This was echoed in Conor Medsystems Inc v Angiotech Pharmaceuticals Inc [2008] RPC 28 (“Conor Medsystems”), at H14 14 wherein it was accepted that “if [dependent] claim 12 failed, the wider claims also failed.” [31] There is no technical definition of an independent claim or a dependent claim in Malaysian patent law to shed light on the comprehension of such terms. The only description of a dependent claim in Malaysia is set out under regulation 14(1) of the Regulations, which is as follows: “any claim which includes all the features of one or more other claims, shall contain, if possible, a reference to the other claim and shall then state the additional features claimed”. (emphasis ours) [32] Regulation 14 emulates the statutory description of a dependent claim in the US Federal law. We find the US statutory description of a dependent claim instructive and useful to understanding the universal concept of how it interrelates to an independent claim. DEFINITION OF DEPENDENT CLAIMS IN THE US [33] The description under federal law in 35 United States Code (U.S.C) § 112 (2006) describes a dependent claim as follows: “A claim in dependent form shall contain a reference to a claim previously set forth and then specify a further 15 limitation of the subject matter claimed. A claim in dependent form shall be construed to incorporate by reference all the limitations of the claim to which it refers.” (emphasis ours) [34] The US Code of Federal Regulations [37 CFR § 1.75(c)] and the US Manual of Patent Examining Procedure [section 1824,

6.4(a)] also describes a dependent claim in a similar fashion as the aforementioned federal provision. It is apposite to note that these provisions consistently refrained from dictating that a dependent claim’s survival depends on the independent claim. All three provisions merely describe a dependent claim as containing a reference to a claim previously set forth, and further limiting the scope claimed. It acknowledges the close relationship between such claims, but does not assert that their survival is interdependent. [35] Therefore, it is inaccurate to merely perceive a dependent claim as only an extension of an independent claim based on the above understanding of the universal concept of how an independent claim interrelates with a dependent claim. It is included to further narrow the scope of monopoly to protect such features against infringement by third parties. 16 FORMS OF CLAIMS [36] Patentees are permitted to draft their claims however they please, incorporating as many or as few features in the specifications to form the basis of their claims. [37] Figure 2 below shows the structure of a patent with particular focus on its features (Features A to F). These features listed in the specification will form the basis of the claims in a patent. [38] In drafting claims, an independent claim would typically be a broad, general claim that is an amalgamation of its dependent claims which are subsets of the independent claim. An example of this type of 17 form of claim can be found in the case of Ultraframe (UK) Ltd v Eurocell Building Plastics Ltd [2005] RPC 36, at para 41: “The argument is this: that the width of claim 1 must be wider than claim 3 and that it was only claim 3 which contained a limitation requiring some prior restraint. It is an example of the argument epitomised by the late Anthony Walton QC: "Claim 1 'A car'; Claim 2 'A car wherein the wheels are round'" – forcing you to the conclusion that claim 1 covers cars with non-round wheels.” [39] We will hereinafter refer to this type of form as a “Type 1” for ease of reference. [40] Another form of claim is that which is described in the case of Generics in [24] above where the dependent claims include features that are added to the independent claim. We shall refer to this form of claim as “Type 2” claims. [41] Figure 3 below shows the 2 types of forms that exist, incorporating the features in Figure 2. 18 [42] Type 1 claims consist of one or more independent claims which are supersets of their dependent claims incorporating all features A to F, to have the broadest scope possible. Naturally, the dependent claims would be subsets of the independent claim, focusing on specific features and having a narrower scope. [43] Type 2 claims consist of one or more broad independent claims which do not necessarily include all of the features listed in the specification. Their dependent claims however, include additional features over and above the independent claim(s), making them more specific, having a narrower scope, and thus harder to infringe. [44] It is also important to note that some of the drafting of claims might incorporate both Type 1 and Type 2 claims. The different forms of claims have different implications when determining their interdependency and by extension, their validity. 19 INTERDEPENDENCY OF CLAIMS [45] Section 26 of the Act provides that “an application shall relate to one invention only or to a group of inventions so linked as to form a single general inventive concept” (unity of invention). This would suggest an automatic presumption of association between claims if a patent has been granted, be it by reason of construction or language. [46] Despite this presumption existing upon grant, it is not intrinsic during invalidity and infringement proceedings. [47] Determining the interdependency of claims is paramount for the purposes of deducing which dependent claims might fall when the claim(s) they are dependent upon fail(s). It is incumbent upon a trial court to not only read and construe the independent and dependent claims in full but to also hear evidence in respect of each of those claims or category of claims as may have been defined by counsel at the outset of trial. In this case and in SKB Shutters, there was no such consideration of oral evidence in respect of the dependent claims. THE ENGLISH POSITION [48] The Plaintiffs submit that dependent claims should be adjudged separately from the independent claim and rely on Laddie J’s statements in Raychem Corp’s Patents [1998] 2 RPC 31, at 36 (“Raychem”) stating, of subsidiary (dependent) claims: 20 “Maintaining independent validity for subsidiary claims has, in substance, a similar effect to the patentee asserting that he has an equivalent number of separate inventions or patents. The party attacking validity has to direct his evidence to proving invalidity to all of them.” THE AMERICAN POSITION [49] The American statute 35 USC s 282(a) gives weight to this argument stating: “Each claim of a patent (whether independent, dependent, or multiple dependent form) shall be presumed valid independently of the validity of other claims; dependent or multiple dependent claims shall be presumed valid even though dependent upon an invalid claim.” [50] The American cases of Honeywell Int'l, Inc. v. Hamilton Sundstrand Corp., 370 F.3d 1131, 1148 (Fed. Cir. 2004) (“Honeywell”) and Wahpeton Canvas Co v Frontier Inc 870 F.2d 1546, 1552 at n9 (“Wahpeton”) approach dependent claims in a similar fashion. [51] In Honeywell: “Each claim defines a separate invention, whether or not written in independent form; and its validity stands or falls separately." 21 [52] In Wahpeton: “One may infringe an independent claim and not infringe a claim dependent on that claim. The reverse is not true. One who does not infringe an independent claim cannot infringe a claim dependent on (and thus containing all the limitations of) that claim.” The first sentence in the quotation here evidently refers to Type 2 claims discussed above. [53] A consideration of Malaysian case law prior to SKB Shutters discloses that a similar position conceptually was adopted. [see for example Fukuyama Automation Sdn Bhd v Xin Xin Engineering Sdn Bhd & Ors [2015] 9 MLJ 823 and Winthrop Pharmaceuticals (Malaysia) v Astrazeneca UK Limited [2015] MLJU 2014]. After considering the positions in both the UK and the US, we are in agreement with the Plaintiffs that independent and dependent claims should be treated separately. [54] In our opinion, the treatment of interdependent claims in other jurisdictions is relevant, especially to Type 2 claims. This is because dependent claims incorporate additional features not included in the independent claim which could therefore have independent validity should the independent claim be invalidated, despite their dependence upon it. [55] A Type 1 claim, although having its dependent claims intertwined with its independent claim(s), could still have its dependent claims found to be independently valid depending on the basis of challenge to the patent’s validity. 22 [56] The determination of the form of claims will lay the foundation for the treatment of Type 1 claims and Type 2 claims. BASES OF CHALLENGES [57] The bases of challenges to validity include, but are not limited to:

lack of novelty/anticipation;

lack of inventive step/obviousness;

ambiguity;

insufficiency; and

lack of industrial applicability. We will pay particular attention to bases relating to Prior Art (lack of novelty/anticipation and lack of inventive step/obviousness) because these bases of challenge are relevant to the present appeal. [58] In cases where the validity of patents is challenged based on Prior Art, it is imperative to consider the type of the claim as it will have an effect on the validity of dependent claims. 23 [59] Figure 4 shows the interaction between Prior Art X (having all the features of the independent claim) and a Type 1 claim. [60] Since the dependent claim is a subset of the independent claim, and all its features are present in the independent claim, it stands to reason that, should the Prior Art have the same features of the independent claim, when the independent claim is found to be invalid, the dependent claim falls. [61] However, for the purposes of this appeal relating to the approach taken in SKB Shutters, it is crucial to note that in order to determine and hold that all the dependent claims fall if the independent claim fails, the trial court undertakes the exercise of hearing evidence to this 24 effect. The trial court does not arrive at this conclusion without the benefit of such evidence. In short, a technical expert witness approximating the person ordinarily skilled in the art is expected to assist the Court in confirming that there are no additional features that make the dependent claim independently valid. The Court will then in a position to determine that all the dependent claims fall after the independent claim fails. [62] This position is echoed in Raychem (above) at paragraph [48] where Laddie J expressly stated that the challenger in a patent invalidity suit has to adduce evidence to proving the invalidity of all claims, meaning both independent and dependent claims. [63] Figure 5 illustrates the interaction between Prior Art Y (having all the features of the independent claim as well) and a Type 2 claim. 25 [64] The dependent claim contains all the features of the independent claim along with an additional Feature F. It cannot be the case that should the independent claim be invalid, then the whole dependent claim necessarily lacks validity, as the dependent claim may have a feature or element that is not one disclosed by the Prior Art. [65] The hypothetical representation of circumstances in Figures 4 and 5 coupled with Lefstin’s statements are in line with Laddie J’s discourse in [48] above, in that the opposing party must prove invalidity 26 with regard to all claims that are opposed should the dependent claims have independent validity. [66] It is true that when the validity of a patent is challenged based on Prior Art and where the form of claims is of Type 1, the dependent claims may be invalidated by virtue of the independent claim being invalid. However, the determination of the type or form employed requires careful consideration of: (i) the language; (ii) the content of the claims themselves; (iii) the expert evidence in respect of each of the claims. THE APPROACH TO BE ADOPTED BY A TRIAL COURT [67] As Oliver LJ stated in Windsurfing International Inc v Tabur Marine (Great Britain) [1985] RPC 59, at 73, the first step the court has to take during invalidity proceedings is to “identify the inventive concept embodied in the patent in suit”. [68] Where the language and construction of the claims is less than intelligible, the court should “guard against being impressed by the form and language of the claims rather than the substance of the patentee's alleged technical contribution” as Laddie J observed in Raychem (supra at page 37). Needless to say, this applies to both the independent and dependent claims. [69] The drafting of the claims may be convoluted but it is the court’s duty to work through them nonetheless by “break[ing] free of the 27 language and concern[ing] itself with what the claims really mean” and to determine what a person skilled in the art would have understood the claims to mean (both independent and dependent) (see Kirin Amgen v TKT [2005] RPC 9, at paras 30 - 35). [70] In order to ascertain whether the patent has an inventive concept, it is necessary for the trial court to hear the evidence adduced in respect of the alleged inventive concept in each of the independent and dependent claims. UK CASE LAW [71] The treatment of Type 1 claims in Figure 4 at [54] is that which is adopted in the United Kingdom. The Scottish case of Verathon Medical (Canada) ulc v Aircraft Medical Limited [2011] CSOH 19 (“Verathon”) dealt with a patent of intubation instruments. What the patentee purported to be the inventive concept was the attachment of a camera to visualise the larynx indirectly in lieu of repositioning a patient’s head. [72] Claim 1 was in the following terms: “An intubation instrument, a portion of which is for insertion into a patient through the patient's mouth, comprising: a body (20´, 20˝) having a handle (24) attached thereto; an elongate arm (22) having a substantially straight elongate base portion (202) attached to the body (20´, 20˝) and a substantially straight 28 elongate lifter portion (204) extending from said elongate base portion (202) at a defined angle (208), said elongate base portion having a first defined length (207), said elongate lifter portion

having a second defined length (205) and a smooth surface for engaging the patient's epiglottis and a distal end (210) for insertion distal-end first through the patient's mouth, said elongate arm (22) defining an anterior side positioned toward said handle and an opposite posterior side, and a viewer (80´) operably secured to said posterior side of said arm (22) substantially where said elongate base portion (202) meets said elongate lifter portion (204); characterised in that : said second defined length (205) being about as long as first defined length

(207); said viewer (80´) being directed toward the distal end (210) of said elongate lifter portion (204); and said viewer (80´) being a camera.” [73] Claims 2 to 10 and 14 to 17 are dependent on Claim 1 and incorporate modifications to the features of the laryngoscope. These include modifications to the lengths of parts of the laryngoscope, and to the specific features of the equipment. Claims 11 to 13 are also dependent on Claim 1 but deal with the angle of extension of the lifter portion of the laryngoscope. [74] It was acknowledged by the patentee that if Claim 1 failed for want of inventive step, Claims 2 to 10 and 14 to 16 would also be invalid [Verathon (supra at para 138)]. 29 [75] However, Lord Hodge held the patent to be valid based on his construction of Claim 1 [Verathon (supra at para 172)]. His Lordship then went on to state that Claim 17, which was a dependent claim, would have been independently valid if the Prior Art did not already disclose a device with a wireless connection to a monitor for viewing. [76] The dependent claims in Verathon (supra) were of the Type 1 form where Prior Art had not overlapped with the independent claim (Claim 1). Therefore, the patent’s independent claims and dependent claims along with their amendments were held to be valid. If the independent claim was held to be invalid, then the claims which were depended upon it would also be invalid, supporting the treatment in Figure 4. [77] However, the point to be noted in this case is that, although there was a concession that the dependent claims would fall if the independent claim was found to be invalid, the court nonetheless went on to examine the dependent claims and concluded that Claim 17 would have possessed independent validity. [78] As for Type 2 claims, the approach in the United Kingdom is that invalidity of the independent claim does not preclude the dependent claims from being valid themselves as illustrated in Figure 5. 30 [79] One such case which demonstrates this approach is Conor Medsystems (supra) which dealt with a patent relating to stents for coronary angioplasty. Claims 1, 11, and 12 were in the following terms: “1. A stent for expanding the lumen of a body passageway, comprising a generally tubular structure coated with an anti-angiogenic factor and a polymeric carrier, the factor being anti-angiogenic by the CAM assay, and wherein said anti-angiogenic factor is taxol, or an analogue or derivative thereof.

A stent according to any one of claims 1 to 5 for treating narrowing of a body passageway.

A stent according to claim 11 for treating or preventing recurrent stenosis [“restenosis”].” [80] It was common knowledge at the time that stents could be used to treat stenosis, but such a method was susceptible to restenosis. However, it was contended by the patentee that the beneficial use of taxol coating on the stents was not common knowledge despite taxol being known to be anti-angiogenic. [81] There was no dispute between the parties that if Claim 12, the narrow dependent claim, failed, then the wider claims would also fail. The court dealt with the primary debate about Claim 12 by working backwards, starting with the dependent claim, which if found to be invalid, would invalidate the wider claims. This case illustrates the 31 point that a trial court has to look at the dependent claims separately to determine the validity of a patent. AUSTRALIAN CASE LAW [82] The same treatment is employed in Australia for Type 1 claims. The case of Austal Ships Pty Ltd v Stena Rederi Aktiebolag [2005] FCA 805 (“Austal Ships”) corroborates this point. [83] The case dealt with a patent for the structure of a hull for multi-hulled ships. Claim 1 was independent while Claims 2 to 9 were dependent upon Claim 1. It was conceded that if opposition to Claim 1 failed on the basis of lack of novelty, opposition to Claims 2 to 9 would also fail. However, if opposition to Claim 1 was successful, then the independent novelty of the dependent claims would have to be determined and addressed. This is in line with the explanation of the “inverted pyramid structure” in [23] above. The claims would have to be dealt with separately to determine their scope notwithstanding the concessions made by the patentee. This underscores the point that each independent and dependent claim has to be considered and dealt with separately. AMERICAN CASE LAW [84] The American courts also approach Type 2 claims in a similar manner as borne out by the case of Sandt Tech., Ltd. v. Resco Metal & Plastics Corp., 264 F.3d 1344, 1356 (Fed. Cir. 2001) where it was 32 held that "because dependent claims contain additional limitations, they cannot be presumed to be invalid as obvious just because the independent claims from which they depend have properly been so found." [85] This case consolidates our view that where Prior Art does not fully disclose features present in the claims, such claims may possess independent validity and must be considered as such. OTHER BASES OF CHALLENGES [86] Some invalidity proceedings might not be conducted on the basis of Prior Art but the challenge to validity could instead be on the bases of insufficiency of disclosure or ambiguity of the claims. In cases such as these, the treatment of claims illustrated in Figures 4 and 5 may not apply as the figures relate solely to opposition based on Prior Art. INSUFFICIENCY OF DISCLOSURE [87] For example, in cases of insufficiency like the recent UK Supreme Court case of Warner-Lambert Co LLC v Generics (UK) Ltd (t/a Mylan) and another (Secretary of State for Health and others intervening) [2019] 3 All ER 95, the court addressed each claim separately to determine the scope of each claim and their interdependence upon one another. In this case, the patent involved a drug called ‘pregabalin’ used for treating pain. Claim 1 was the 33 independent claim and Claims 2 to 14 were dependent claims. Claims 1, 2, and 3 were in the following terms: “1. Use of [pregabalin] or a pharmaceutically acceptable salt thereof for the preparation of a pharmaceutical composition for treating pain;

Use according to Claim 1 wherein the pain is inflammatory pain;

Use according to Claim 1 wherein the pain is neuropathic pain.” [88] Claims 4 to 14 dealt with various types of pain within the subsets of Claims 2 and 3. [89] Their Lordships addressed each dependent claim separately, determining whether they fell under the umbrella of inflammatory or neuropathic pain before determining whether the disclosure supported those claims. It was held that the disclosure had not supported the claim that the drug helped to treat neuropathic pain. Thus, Claims 1 and 3 and the claims dependent upon Claim 3 were deemed to be invalid. AMBIGUITY [90] As for cases where opposition was based on the ambiguity of claims, the court has a duty to give appropriate meaning to the claims 34 in question as mentioned in [68] with reference to Raychem (supra at page 37). [91] This approach was applied in BASF AG v SmithKline Beecham plc [2004] IP & T 846 (EWCA Civ) (“BASF”). The court had to determine the meaning of the phrase “‘substantially free of bound propan-2-ol”. To do so, it examined the specification of the patent (BASF at para 24) and the intention of the draftsman of the claims (BASF at para 26). The relevant evidence at trial had to be considered before the court could conclude that the phrase did not have a meaning other than its ordinary meaning and the claims utilising the phrase were held to be invalid (BASF at para 31). [92] The courts in these 2 cases could not apply the treatment of claims depicted in Figures 4 and 5 because the circumstances of the cases did not relate to Prior Art. [93] Therefore, in cases where the challenge to validity is based on Prior Art (lack of novelty/anticipation or lack of inventive step/obviousness), the trial court is bound to hear evidence on each claim (whether independent or dependent) unless there is a concession and to then determine the type or form of claim (whether Type 1 or Type 2), before considering the validity of each of the independent and dependent claims. [94] In cases where the challenge does not relate to Prior Art, the position is the same, namely that the court should examine all claims 35 individually. It is not open to a court to sidestep the need to hear and consider necessary evidence in respect of each claim, whether independent or dependent. [95] In light of the analysis above, we are unable to accept the Defendant’s submission that the position adopted in SKB Shutters (supra) was similar to the approach adopted in other jurisdictions. SKB SHUTTERS - AN ANALYSIS [96] The case of SKB Shutters (supra) is the current authority in Malaysia for the treatment of independent and dependent claims when the validity of a patent claim is being challenged. The legal position in SKB Shutters appears to establish a blanket rule that governs all the different types of patent claims in Malaysia, be it completely interdependent claims (Type 1) or claims with additional features (Type 2). [97] It is the Plaintiff’s contention that prior to SKB Shutters, the position in Malaysia was thought to be well settled and consistent with the decisions from the UK as exemplified by Raychem. [98] Upon investigating patent cases in Malaysia, we find that courts in Malaysia have consistently followed the legal positions expounded in the case of General Tire (referred to in Raychem) when the validity of the claim is challenged for lack of novelty and lack of inventive step. In such circumstances, the court must determine whether the 36 patentee’s claim has been anticipated by an earlier publication. It is necessary to compare the features of the claim of the patent with the features of the prior art (see Fukuyama Automation Sdn Bhd v Xin Xin Engineering Sdn Bhd & Ors [2015] 9 MLJ 823, Winthrop Pharmaceuticals (Malaysia) v Astrazeneca UK Limited [2015] MLJU 2014. [99] Interestingly, the above principle was accepted by the courts in SKB Shutters despite this Court coming to the decision that the validity of an independent claim determines the status of the claims that depend on it, without looking at all the claims separately. For ease of reference, the relevant statement given by this Court in SKB Shutters is reproduced below: “[34] We are of the view the law is clear that when it has to determine if an invention which is the subject of a patent claim lacks novelty or inventive steps, one looks at the language of the claims which define the scope and monopoly claimed [See the case of Electric and Music Industries Ltd & Ors v Lissen Ltd & Anor (1939) RPC 23]. The reference in The General Tire & Rubber Co v The Firestone Tyre & Rubber Co Ltd & Ors [supra] to a device is still in the context of a device as disclosed by the claims. It is ultimately the claims which must be looked at and considered.” (emphasis ours) 37 [100] In other words, this Court in SKB Shutters had referred to both the independent and dependent claims but did not emphasise the need for a trial court to undertake the exercise of hearing evidence on each of the claims separately. A reading of the case suggests that a determination of the validity of dependent claims may be arrived at by merely analysing the claims as pleaded without hearing expert evidence. [101] We feel that it is pertinent to note that Laddie J made the following observation in Raychem with regards to General Tire that supports the argument that all the claims must be looked at when the invalidity of a claim is challenged: “Observed: (1) Maintaining independent validity for subsidiary claims had, in substance, a similar effect to the proprietor asserting that he had an equivalent number of separate inventions of patents. The party attacking validity had to direct his evidence proving invalidity of all of them. The greater the number of subsidiary claims, the greater the volume of evidence, including experiments, which would be put before the court.” (emphasis ours) [102] The legal position expounded in SKB Shutters namely that in the event an independent claim is invalidated, all the other claims fall, is, with great respect, not entirely accurate for the following reasons: 38

Even though the independent claim is invalidated, the established practice of law is for a trial court to examine the dependent claims separately despite the invalidation of the independent claim (unless there is an express concession to that effect);

Although in a Type 1 claim, the invalidation of an independent claim due to Prior Art would result in the invalidation of the dependent claims, this position only reflects one of a myriad of possibilities that may arise in patent invalidation proceedings. Therefore, to apply that as a blanket rule would, with great respect, not be an accurate reflection of the law; and

The consequence of applying such an interpretation as stated in SKB Shutters would be to shut out the possibility of an inventor having his valid patent rightfully registered and protected. This is because the potentially valid patent would have been struck out simply by reason of the independent claim having been held to be invalid; [103] The putative effect of the blanket rule established by SKB Shutters is not negligible. Patent applicants, based on this case, may now have to reconsider the insertion of dependent claims as the effect of the invalidity of an independent claim would be fatal to their dependent claims. The only way to overcome this obstacle is to include 39 more independent claims by incorporating the features of dependent claims as the Act and its Regulations do not restrict the number of independent claims in a patent. However, the challenge posed by having several independent claims is the risk of the patent application or a granted patent being attacked for lack of unity of invention as required under section 26 of the Act. [104] The legal position established by the Federal Court in SKB Shutters is binding on all Malaysian Courts vide the principle of stare decisis. [105] The principle of stare decisis derives from the Latin phrase “stare decisis et non quieta movere”, which translates as “to stand by decisions and not to disturb settled matters”. This doctrine has been long rooted in the annals of Malaysian jurisprudence. [106] It is established in Young v Bristol Aeroplane Co Ltd [1944] 2 All ER 293 that the Court of Appeal may depart from its own previous decisions in the following situations:

where the court is faced with two conflicting decisions of its own, it may choose which one to follow;

(ii) the court is not bound to follow one of its own previous decisions which is inconsistent with a later House of Lords’ decision; and 40

(iii) the court is not bound to follow a decision of its own which was given per incuriam [107] In Dalip Bhagwan Singh v PP [1998] 1 MLJ 1, Peh Swee Chin FCJ held that the Federal Court is vested with the power to depart from its own previous decision, but such power must be used sparingly. However, it would be prudent to exercise such power when a former decision which is sought to be overruled is wrong, uncertain, unjust, outmoded or obsolete in the modern conditions. [108] The decision of SKB Shutters, with respect was premised upon an incomplete consideration of the law relating to the invalidation of claims. We are of the considered view that this court should depart from the ruling of the said case. THE RATIONALE IN SKB SHUTTERS [109] In coming to the conclusion that when an independent claim is invalidated, the dependent claims would automatically fall, this Court in SKB Shutters purported to rely on the Du Pont case. E I DU PONT DE NEMOURS & CO V IMPERIAL CHEMICAL INDUSTRIES PLC & ANOR (2007) FCA FC 163 (Du Pont) [110] ICI had lodged 2 patent applications (‘parent application’) in respect of a refrigerant that did not contribute to ozone depletion. This 41 application was opposed by Du Pont based on inter alia, a lack of novelty. At first instance before the Commissioner of Patent, Du Pont succeeded. ICI appealed to a single judge of the Federal Court of Australia. [111] On appeal (see E I Dupont de Nemours & Company v Imperial Chemical Industries PLC [2002] FCA 230), the single judge reversed the decision of the Commissioner of Patent and upheld Du Pont’s opposition against the 2 applications. In determining this appeal, the judge found that the independent claim was invalid and went on to hold that the 3 other dependent claims also fell. ICI appealed but the Full Court (comprising 3 judges of the Federal Court) refused leave. [112] Following this, ICI filed a ‘new’ divisional application seeking the grant of a patent for the same subject matter. This was identical to one of the initial applications. This was refused by the Commissioner of Patent as a result of the earlier decision of the single judge of the Federal Court, where it was held that the independent and the dependent claims were all invalid. [113] ICI then applied for an amendment to the patent application deleting the previous independent claim and relying only on a dependent claim which earlier fell (by reason of the independent claim having been invalidated). This proposed amendment was also refused by the Commissioner. 42 [114] ICI then appealed to a single judge of the Federal Court who found that the amendment ought to be allowed. The reasoning of this judge in allowing the amendment was that the amended dependent claim was now an independent claim with a new identity and could therefore be assessed anew. The matter was then remitted to the Commissioner of Patent for amendment, which was duly done. [115] Du Pont then filed an appeal to the Full Court opposing the amendment on various grounds. However, the main issue before the Full Court was whether issue estoppel operated to preclude ICI from seeking to re-litigate the validity of its dependent claim in its patent, given that ICI’s parent application had been dismissed. The Full Court held that there was no issue of estoppel because the original dependent claim 4 had been amended to become the new independent Claim 1, which contained an additional feature which was novel. [116] It is apparent from a perusal of the judgments relating to this series of litigation, that the primary issue for consideration by the Full Court was that of issue estoppel. The focus of the judgment related to whether ICI was precluded from filing an amendment application for what was, in essence, the same dependent claim that had earlier been dismissed due to the invalidity of the independent claim on which it was based. It does not appear from the judgment of the Full Court of Australia that it was focused on laying down any form of rule for the treatment of dependent claims to the effect that they fell 43 automatically as a consequence of the independent claim being held to be invalid for lack of novelty. [117] Nonetheless it was relied upon by this Court in SKB Shutters as authority for the proposition that when an independent claim is invalid all the dependent claims similarly fall, without the court having to undertake any independent evidential assessment as to whether the dependent claims are individually valid. With great respect, we are of the view that the reliance on Du Pont for such a blanket ruling is not an accurate statement of the law. [118] Apart from the fact that it does not appear to be authority for such a proposition, it is clear from other Australian authorities such as Austal that all claims albeit independent or dependent, have to be considered individually and/or separately. [119] This is also consonant with the positions adopted in other jurisdictions, as borne out by the cases of Honeywell (US) and Raychem, Generics, and Conor Medsystems (UK). [120] Again with great respect, none of these authorities was considered or compared with Du Pont when the ruling in SKB Shutters was crafted. [121] In any event, the courts in Du Pont did not expressly state that dependent claims are not to be looked at when the validity of a patent claim is being challenged. In fact, it is necessary to look at all the claims 44 separately, albeit briefly, as the court might in the process, find additional features in such dependent claims which would confer validity on these dependent claim. In Du Pont, the court in the parent application could very well have found the additional/variant feature in the dependent claim had it investigated the dependent claims. This was expressly noted by the Full Court in its judgment. [122] In SKB Shutters, the finding of fact of the Court of Appeal (which decision was later affirmed by the Federal Court) was made through assessments restricted solely to the independent claims and a theoretical perusal of the dependent claims. This is evident from the Court of Appeal’s statement “… that the court need only to consider claim 1 which describes the basic invention, and claims 9 and 11. The other claims are, what learned counsel describes as, 'dependent claims'” (see Seng Kang Shutter Industries Sdn Bhd & Anor v SKB Shutters Manufacturing Sdn Bhd [2014] 5 MLJ 98 at [21]). This approach is not adopted in other major patent jurisdictions such as the US, UK, Australia and Malaysia prior to SKB Shutters. [123] Further, although it is clear from the judgments of the appellate courts in SKB Shutters that only the independent claim was taken into consideration in determining the validity of the patent, this, in our view, does not justify the general application of this approach to all types of patent claims and challenges to such claims, which could encompass challenges based on insufficiency, ambiguity and lack of industrial applicability (as we have set out earlier.) 45 [124] For all these reasons, we are constrained to depart from the decision in SKB Shutters. We reiterate that it is essential that when a court is tasked with ascertaining the validity of a patent comprising both independent and dependent claims, the trial court is bound to evidentially assess each of these claims separately. FURTHER CONSEQUENCES OF SKB SHUTTERS [125] This Court in SKB Shutters further held that a dependent claim must be re-drafted as it cannot remain dependent on an invalid independent claim. It went on to say that there is no provision in the Act that provides for the right of amendment of claims pending litigation in respect of validity, as opposed to the position in the United Kingdom. [126] The rationale of this Court in SKB Shutters was that once an independent claim is found to be invalid, the dependent claim no longer has anything to latch on to and would therefore fail, unless the dependent claim is redrafted as an independent claim. We now consider whether such rationale is justified. AMENDMENTS [127] The position in SKB Shutters which links the demise of a dependent claim to that of an independent claim, is not entirely tenable. With respect, the court in that case linked the prohibition of amendment 46 of claims pending proceedings under section 79A(3), to the failure of a dependent claim as soon as the independent claim was invalidated. However, a perusal of section 79A(3) discloses that while the Registrar is prohibited from effecting amendments during proceedings, it does not bar amendments to be applied for during proceedings, and made after proceedings. Therefore amendments per se are not barred by section 79A(3). [128] A claim may be partially invalidated by virtue of section 56(3) of the Act, where it was stated that: “Where the provisions of subsection (1) apply on only some of the claims or some parts of a claim, such claims or parts of a claim may be declared invalid by the Court and the invalidity of part of a claim shall be declared in the form of a corresponding limitation of the claim in question.” (emphasis ours). [129] By virtue of section 56(3), the Act envisages the grant of a declaration by the Court to preserve the validity of some claims or parts of a claim, which would in turn necessarily require these claims or parts of claims to be reworded to reflect partial validity. To give effect to partially invalid claims, the these claims must be amended. Section 56(3) requires that the invalid parts “be declared as a corresponding limitation of the claim in question.” This implicitly empowers the court to order amendments of the surviving claim(s). 47 [130] Therefore this Court in concluding in SKB Shutters that amendments per se were prohibited by the Act was less than accurate. [131] The fact that section 56(3) allows for partial validity supports the argument that a dependent claim may survive, even when an independent claim collapses. This allowance of partial invalidity is also reflected in section 63 of the UK Patents Act. [132] A further argument supporting this conclusion is found in section 57(2). On the surface, a cursory reading of section 79A(3) appears to prohibit amendment of partially invalidated claims pending proceedings. However, pursuant to section 57(2), the invalidation of a patent only becomes effective after the Registrar has recorded the declaration in the Register. The court may give liberty to the patentee to apply to amend their claims to reflect their partial validity, but the said amendments would not take effect until the Registrar has effected these amendments after the final order of court or in the event of an appeal, until the appeal is disposed of. [133] Section 79A(3) therefore only prohibits the Registrar, during invalidation proceedings, from recording or registering the amendments but does not expressly prevent patentees from applying to amend their claims. It follows that amendments per se are not prohibited by section 79A(3). [134] Hence, by construing section 56(3), section 57(2), and section 79A(3) together, in the event of partial invalidity, an application to 48 amend a dependent claim may be permitted after court proceedings. This ensures that the invalidity of the independent claim would not affect all other dependent claims. The point we seek to make here is that the conclusion drawn in SKB Shutters, namely that amendments under the Act are prohibited is not entirely accurate, and this comprises a further reason we are constrained to depart from SKB Shutters. CONCLUSION [135] For all the reasons that we have given above, our answer to the leave question is in the negative. When an independent claim is deemed to be invalid, it does not necessarily follow that all dependent claims which make reference to the said independent claim will automatically fail. [136] The validity of these dependent claims will ultimately depend on the form of claim used, whether Type 1 or Type 2, and the basis of challenge to their validity. A trial court can only ascertain the type of claim before it through undertaking the evidential process of examining each claim separately. If it fails to do so, the trial court may well overlook any additional features embedded within a dependent claim that could render such claim independently valid. The serious consequence of failing to undertake this examination is that a patentable invention would not be protected. 49 [137] If the claims are of Type 1 form and the basis of challenge relates to Prior Art (lack of inventive step/obviousness or lack of novelty/anticipation), then, when the independent claim is invalidated, the claims dependent on the said independent claim may also be declared to be invalid, but only after the trial court undertakes the evidential process described above (unless there is an express concession). [138] Where the claims are of Type 2 form and the basis of opposition relates to Prior Art, the dependent claims, when the independent claim is invalidated, have to be addressed separately to determine their validity. This is because they may have additional features that have not been disclosed by Prior Art or prior publications. [139] And if the basis of challenge does not relate to Prior Art, then the language and structure of all claims will have to be addressed separately to determine their scope, interdependency, and validity on a case by case basis. This also requires the court to undertake the evidential process. [140] We are of the opinion that the principle established in SKB Shutters that when an independent claim is invalid, all dependent claims dependent on the said independent claim also fall with it, fails to take into account the myriad of other claims and bases of challenge that routinely arise in patent adjudication. 50 [141] Accordingly, we allow this appeal and remit the case to the High Court to determine whether each of the dependent claims (i.e. Claims 2 to 22) possesses independent validity (notwithstanding the fact that this case may entail Type 1 Claims or unless there is an express concession). NALLINI PATHMANATHAN Judge Federal Court Putrajaya Dated: 21st August 2019 For the Appellant : Indran Shanmuganathan (Zaraihan Shaari, Michelle Loi Choi Yoke, Yap Khai Jian, and Elisia Engku Kangon with him) Messrs Shearn Delamore & Co Advocates and Solicitors Tingkat 7 Wisma Hamzah-Kwong Hig No. 1 Leboh Ampang 50100 Kuala Lumpur For the Respondent: Cindy Goh Joo Seong (Heidi Lim Ai Yuen and Hayden Tan Chee Khoon with her) Messrs. Chooi & Co + Cheang & Ariff Advocates and Solicitors 39 Court @ Loke Mansion 273A Jalan Medan Tuanku 50300 Kuala Lumpur Signed