Dependent Claims Fully Restored (Merck Part 2)
DEPENDENT CLAIMS FULLY RESTORED (MERCK PART 2)
While the FC Merck case was highly welcomed, it was doubtful whether the shadow of the SKB Shutters Ruling lingered on patent practices, given the introduction of Type 1 and Type 2 claims by the FC
Dependent claims are commonplace in patents where such claims, which are narrower in nature, include all the features of one or more independent claim(s) with additional or limiting features. Generally, these dependent claims would act as "fall-back" claims if the independent, wider claim is invalidated. However, the need for dependent claims was severely diluted by the 2015 decision of SKB Shutters Manufacturing Sdn Bhd v Seng Kong Shutters Industries Sdn Bhd & Anor1 whereby the Federal Court ("FC") ruled that the validity of a dependent claim will automatically fall upon the substantive finding of invalidity of its independent claim ("the SKB Shutters Ruling").
Four years later, the FC cured this precarious position by overruling the SKB Shutters Ruling in the case of Merck Sharp & Dohme Corp & Anor v Hovid Berhad2 ("the FC Merck case"). As a brief background, Merck's patent was one for "pharmaceutical compositions for use in inhibiting bone resorption" ("the 194 Patent") which consisted of independent claim 1 and dependent claims 2 to 22. In 2014, Merck commenced an infringement action against Hovid Berhad ("Hovid") while Hovid sought to invalidate the 194 Patent. The High Court ("HC") held that independent claim 1 was invalid due to obviousness. Being bound by the SKB Shutters Ruling due to stare decisis, the HC subsequently invalidated dependent claims 2 to 22 without considering their validity separately.
On appeal to FC, the FC held that the validity of the dependent claims must be assessed independently, notwithstanding the fall of the independent claim which they depended upon. In particular, the FC introduced the novel concepts of Type 1 and Type 2 patent claims. Consequently, the FC ordered a remittal of the case to the HC to determine whether each of the dependent claims (claims 2 to 22) possessed independent validity ("the Remitted Case").
THE CONCEPT OF TYPE 1 AND TYPE 2 PATENT CLAIMS
The FC relied on the following diagram to explain the concept of Type 1 and Type 2 patent claims:
The FC explained that:
a) Type 1 claims are defined as consisting of one or more independent claims which are supersets of their dependent claims. The dependent claims herein would thus be subsets of the independent claim, focusing on specific features and having a narrower scope than its independent claim.3
b) Type 2 claims are defined as consisting of dependent claims which include additional features over and above the independent claims making them more specific.4
According to the FC, the interdependency of claims hinges on whether the claims are Type 1 or Type 2 claims. The FC seemed to suggest that:
a) If the claims are Type 1 claims and the basis of challenge relates to prior art (namely obviousness or lack of novelty), then, when the independent claim is invalidated, the claims dependent on the said independent claim may also be declared to be invalid.5
b) However, if the claims are Type 2 claims and the basis of challenge relates to prior art, when the independent claim is invalidated, the dependent claims 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.6
THE REMITTED CASE
In the course of the Remitted Case, Hovid mounted its challenge by arguing that the said dependent claims were Type 1 claims and since the independent claim 1 had been invalidated, the said dependent claims should likewise be automatically invalidated.
While Merck conceded that the said dependent claims were Type 1 claims, it argued that for an automatic invalidation of a Type 1 claim to occur, the prior arts relied upon to invalidate the independent claim must have disclosed the entire range of the features of the independent claim.7
In the course of its arguments in the HC, there was also reliance on the acknowledgment by the FC that Type 1 claims could remain open for independent assessment when it cited the Scottish case of Verathon Medical (Canada) ulv v. Aircraft Medical Limited.8 In that case, despite dependent claim 17 of the patent being a Type 1 claim in form, the court acknowledged that claim 17 would have been independently valid if the Prior Art did not already disclose a device with a wireless connection to a monitor for viewing'.9 Flowing therefrom, Merck argued that the 'automatic invalidation' would not apply to the facts of its dispute as none of the prior arts relied upon by Hovid in its invalidation of independent claim 1 disclosed the entire range of the dosages and periodicities of claim 1. On this basis alone, the said dependent claims must be assessed independently, despite being Type 1 claims.
More importantly, Merck contended that if the Court accepted Hovid's interpretation of the concept of Type 1 claims, there was the danger in returning to the SKB Shutters heydays which would have been inconsistent with the spirit and intent of the FC Merck case, having earlier departed from the SKB Shutters Ruling.
In its oral decision on 6 April 2021, the learned HC Judge agreed with Merck's interpretation of the concept of Type 1 claims. The Judge found that since none of the prior arts cited by Hovid disclosed all the essential features of independent claim 1 of the 194 Patent, the HC was obliged to independently assess the validity of the said dependent claims.
CELEBRATING THE PROPER INTERPRETATION OF TYPE 1 AND TYPE 2 CLAIMS
While the FC Merck case was highly welcomed, it was doubtful whether the shadow of the SKB Shutters Ruling lingered on patent practices, given the introduction of Type 1 and Type 2 claims by the FC. Questions arose as to whether dependent claims would be automatically invalidated upon the invalidation of their independent claim, merely because such claims fell within the realm of Type 1 claims. Fortunately, the HC clarified the concepts of Type 1 and Type 2 claims in the Remitted Case, which restores patentees' confidence in dependent claims.
Disclaimer – The views expressed in this article are the personal views of the authors and are purely informative in nature.