Ireland – Guide to Preliminary Injunctions in Patent Litigation

Introduction

There has been an increase in patent litigation in Ireland in recent years, including both substantive proceedings and preliminary injunction applications. This includes applications directed towards manufacturing taking place in Ireland where the irreparable harm arises outside of Ireland, for example, in the US, the EU and elsewhere. A dedicated Intellectual Property and Technology list within the Commercial Court was introduced in 2021, where patent and Supplementary Protection Certificate (SPC) related disputes are typically handled.

The law of preliminary injunctions is in a good place for patent and SPC holders in Ireland generally, with a big focus on the harm that would be suffered by the patentee, the presumptive validity of intellectual property rights and whether companies could have sought to clear the way.

Triggers for seeking a preliminary injunction in Patent / SPC matters

As well as product launch, indications of imminent launch (e.g. by notification or response to a warning letter) will provide a strong case for a party seeking a preliminary injunction in patent & SPC related matters. Preliminary injunctions are more likely to be granted if for example, the alleged infringing product has not yet or has only just been launched. Indications of an intention to commence manufacture prematurely in Ireland (including for export) would also be a basis for seeking a preliminary injunction in Ireland.

It is always necessary for a party to act quickly when seeking a preliminary injunction. A delay on the part of a company in seeking a preliminary injunction could ultimately impact its chances of success.  A company should take steps as soon as it becomes aware of a threat of infringement in Ireland.

The test as set out in the leading Case – MSD v Clonmel

In Ireland, the granting of preliminary injunctions is subject to equitable principles and therefore the court always has discretion whether to order an injunction. In Merck Sharp & Dohme LLC  v Clonmel Healthcare Ltd [2019] IESC 65 (MSD), the Supreme Court delivered an extremely important and far-reaching decision concerning the appropriate test for the grant of preliminary injunctions, which reasserted the flexible nature of the remedy and clarified that adequacy of damages (or irreparable harm) should be assessed as forming part of the wider balance of convenience. The Irish courts must now consider the balance of justice and not just irreparable harm when deciding whether to grant relief. The adequacy of damages, although often the most important factor, is part of the overall balance of convenience, and not an antecedent stand-alone test which must be satisfied prior to a consideration of the balance of convenience. The court recognised that there may be other factors which are relevant, and which may tip the balance.

Whether a preliminary injunction will be granted by the Irish court tends to be highly fact sensitive. Preliminary injunctions are granted if the party seeking the injunction establishes:

• There is a serious issue to be tried; and
• The “balance of convenience” favours the grant of an injunction.

The patentee must adduce evidence that shows that there is a "fair or serious issue to be tried", which means no more than the case not being frivolous or vexatious. It is not necessary for the patentee to establish a prima facie case: that is, that on the balance of probabilities it is more likely than not that the patentee will succeed at the trial of the action.

The 8 Factors That the Court Must Take into Consideration

In MSD, the court set out the following 8 steps which might be followed in considering applications for preliminary injunctions:

1. The court should first consider whether, if the patentee succeeded at the trial, a permanent injunction might be granted. If not, then it is extremely unlikely that a preliminary injunction will be granted.
2. Is there a fair question to be tried? This may involve a consideration of whether the case will likely go to trial.
3. The court should consider how best the matter should be arranged pending trial, which includes a consideration of the balance of convenience and the balance of justice.
4. The most important element in that balance is, in most cases, the question of adequacy of damages.
5. In commercial cases where breach of contract is claimed, the court should be robustly sceptical of a claim that damages are not an adequate remedy.
6. Difficulty in assessing damages may be a factor which can be taken account of and lead to the grant of an interlocutory injunction.
7. A number of other factors may come into play and may properly be considered and weighed in the balance in considering how matters are to be held most fairly pending a trial and recognising that there may be no trial. These may include:

• the presumptive validity of intellectual property rights;
• the preference for preserving the status quo;
• the outcome of similar litigation in other jurisdictions; and
• whether the alleged infringer could have "cleared the path" by way of invalidity proceedings.

8. Any application should be approached with a recognition of the essential flexibility of the remedy and the fundamental objective in seeking to minimise injustice.

Prior to the decision in MSD, preliminary injunctions were assessed using the test set out in Campus Oil v Minister for Industry and Energy (No. 2) (based on the American Cyanamid principles, developed in the 1970 case American Cyanamid Co v Ethicon Ltd [1975]). Under this test, the patentee had to establish that: there was a serious/fair issue to be tried, damages would not be an adequate remedy, and the balance of convenience favours the grant of a preliminary injunction. Pursuant to this approach, preliminary injunctions were typically refused where damages were found to be an adequate remedy, and no consideration was undertaken of the balance of convenience. The decision of the Supreme Court in MSD introduced a degree of flexibility by requiring that adequacy of damages be considered as part of the balance of convenience assessment rather than being treated as a separate hurdle to be overcome prior to that assessment.

Is a bond or cross-undertaking payable when filing a preliminary injunction application?

A patentee must always provide a cross-undertaking as to damages as a condition of obtaining a preliminary injunction. This is an undertaking that if the injunction is subsequently reversed at trial, the patentee will compensate the defendant for any losses incurred as a result of the preliminary injunction. A bank guarantee is not required.

Right to Appeal

Preliminary injunction decisions may be appealed to the Court of Appeal as of right. Appeals from the Commercial Court are fast-tracked, with appeal hearings typically taking place in as little as 2–6 weeks. Appeals may be made on both factual and legal grounds to the Court of Appeal. Leave of the Supreme Court is however necessary for second instance appeals. An appeal will be admitted if the Supreme Court is satisfied that the decision involves a matter of general public importance, or the interests of justice require it.

Recent Decisions / Developments

In Merck Sharp & Dohme LLC v Mylan Ireland Limited & Anor. Clonmel Healthcare Limited [2023] IEHC 24 relating to a combination SPC that protected MSD's Janumet combination product used to treat type 2 diabetes, a preliminary injunction was granted by the High Court (Sanfey J) to MSD to prevent the launch of a generic drug in advance of the expiry of the SPC in issue. In applying the test set out in MSD, the court inter alia noted that an SPC holder has a right conferred by a process of law which is presumptively valid. The fact that there had been “varied” results across Europe and many decisions were under appeal was also taken into consideration. As a result, the court held that Mylan did not have such a strong case that the presumption of invalidity of the SPC which was the subject matter of the dispute had to be set aside.  The court also held that Mylan had failed to take steps to "clear the way" for its generic drug and that this whilst not a single dispositive argument, was a factor in support of the court preserving the status quo ante by granting preliminary injunctive relief. The decision of the High Court was upheld by the Court of Appeal in an ex-tempore decision delivered in April 2023.

In Biogen MA Inc and Biogen International GmbH v Laboratories Lesvi S.L. and Neuraxpharm Ireland Limited [2023] IECA 71 the High Court had refused to grant a preliminary injunction to prevent infringement of a patent that protected Biogen's drug Tecfidera. However the Court of Appeal in reversing this decision, noted that when assessing clearing the path arguments in context of the balance of convenience, the threshold test is that the case for invalidity must be strong and/or that there have been successive determinations on the merits invalidating the right and that then might weigh against the grant of an injunction.

In Bristol Myers Squibb Holdings Ireland Unlimited Company v Norton (Waterford) Limited t/a Teva [2024] IECA 49 in a case relating to the anticoagulant drug Eliquis (apixaban), the Court of Appeal in its judgment in June 2023 expressed the view that if a generic producer seeks to clear the path, it must do so until all appeals have been exhausted. In response to the argument that a generic entrant should get credit for the steps that it had taken to clear the path, the court dismissed this argument and expressed the view that no cogent argument was advanced as to what weight, if any, should be given to a generic that had tried to clear the path but had ultimately not yet done so. 

More recently in Bristol Myers Squibb Holdings Ireland Unlimited Company v Norton (Waterford) Limited t/a Teva [2024] IECA 143 the High Court (Barrett J) had held that the patent held by BMS was invalid. It refused to renew the pre-trial injunction that was in place restraining the launch of the generic drug and BMS appealed the refusal to the Court of Appeal. The Court of Appeal reversed the decision of Barrett J., finding in favour of BMS. In examining the test laid down by MSD, the court noted that there was no indication of what weight was attributed to each factor and how it favoured a refusal to grant the injunctive relief that was sought. The court felt that the weight attached to the outcome of the trial at first instance was ‘significantly overstate[d]’ and that there was a failure to properly assess the application as advanced by BMS. The trial judge was said to have neglected to examine the fact that the validity for the patent be restored upon appeal. The Court of Appeal expressly acknowledged the impact of eight generic manufacturers having made ‘significant steps’ to launch products in Ireland. In particular, the court paid attention to the fact that the HPRA had already made interchangeability decisions and published three reimbursement prices which would have exponentially sped up the change from prescribing the branded product to generic. The Court of Appeal also noted the absence of evidence before it of whether an originator had ever restored the price of a drug once it had been made available as a discounted price to the market, the court questioned whether an originator would be able to restore their position if the patent was found to be valid pursuant to an appeal. The court acknowledged that damages were an inadequate remedy for both parties but expressed the view that “the balance is not finely balanced but rather clearly favours BMS."

Takeaways

Whilst preliminary injunctions remain a discretionary and flexible remedy, a key takeaway from the recent decisions of the Irish Courts is the focus on factors such as the harm that would be suffered by the patentee, the presumptive validity of intellectual property rights and whether companies could have sought to clear the way.

The Irish Courts have also acknowledged that it is also open to a patentee to seek a preliminary injunction relating to manufacture or planned manufacture in Ireland for the purpose of supplying other markets and to inter alia place reliance on the irreparable harm that would be suffered in the markets in question.

For further details about patent law in Ireland, see our Patent Litigation Comparator Guide