Biogaran v. Laboratoire Medidom, Laboratoires Negma, Tribunal de grande instance (3rd chamber, 3rd division), Paris, 27 January 2012, Case No. 09/17355, with thanks to Sabine Age and Marta Mendes Moreira, Veron & Associes, for sending in the judgment, summary and translation in English
A patentee who has obtained an interim injunction from a court to restrain infringement of a patent which is subsequently held invalid must compensate the defendant for losses sustained as a result of being prevented by the injunction from selling allegedly infringing goods.
The judgment handed down on 27 January 2012 by the tribunal de grande instance of Paris is the first reported decision of a French court on the consequences of the enforcement of a preliminary injunction against an alleged infringer of a patent which is later held invalid.
It orders Laboratoires Negma, exclusive licensee for France of EP 0520 414, covering a pharmaceutical composition containing diacetylrhein (also known as diacerein, an active ingredient for an anti-arthritis drug), to pay damages to Biogaran, a French generic drug company. Biogaran has put on the French market a generic of Laboratoires Negma’s drug on 23 January 2009 but was forced to withdraw as a result of an interim injunction granted on 10 March 2009. However, on the merits, the court of Paris found on 31 March 2010 that the patent was invalid; the court of appeal denied the appeal on 30 June 2010.
The court does not accept Biogaran’s full claim of €8 282 213 for its lost profit between 10 March 2009 and 30 June 2010 because it believes that, absent the injunction, Biogaran would have not remained the only generic drug company on the market for the time its product was withdrawn: in view of the possible competition of other generic companies it reduces the damages to €2 997 567 and grants more than €200 000 for costs.
Claimant’s liability is based on article 31 of French Act of 9 July 1991 (“The enforcement on the basis of a provisionally enforceable judgment… is carried out at the risk of the creditor, who shall restore the debtor’s rights… should the judgment be subsequently modified”) which creates an automatic cross undertaking for the plaintiff to compensate the defendant’s lost if the judgment is later reversed.
This was clear for decades, but had never been applied so far to a preliminary injunction in patent infringement proceedings (probably because such injunctions are rather difficult to obtain from French courts).
A point of interest for practitioners: claimant’s liability is triggered by the mere service of the injunction judgment (even if the claimant does not formally demand that the defendant comply with the injunction).
Read the decision (in French) here.
Read the decision (in English) here.