The Supreme Court of Israel recently held that Sanofi intentionally deceived and failed to provide material information to the Israeli Patent Office during the prosecution of a patent application in respect of Sanofi’s drug Plavix (Clopidogrel Bisulfate)1.
Though Sanofi eventually withdrew the patent application, the Supreme Court held that such deception and failure to provide material information were not consistent with fair competition in the marketplace, since Sanofi’s actions significantly impacted how Sanofi’s competitors brought generic alternatives to market. As such, the Supreme Court held Sanofi liable under claims of unjust enrichment.
Analysis
Commentary on the Sanofi decision has mostly focused on the consequences for patent prosecution in Israel. Indeed, it seems that, in light of the Sanofi decision, patent applicants should be careful to disclose all material information regarding their applications to the Israeli Patent Office.
Even so, the ramifications of the decision extend beyond patent prosecution to broader questions regarding the licensing and enforcement of intellectual property under Israeli law.
For example, the Supreme Court in Sanofi found that the potential deception of, and withholding of material information from, an administrative agency constituted unjust enrichment on the part of Sanofi despite the fact Sanofi withdrew its application and no patent was ever issued.
It is possible that Israeli courts would apply similar logic regarding lawsuits (or threats to bring suits) to enforce issued patents, to the extent such suits are brought in bad faith or against products or services known not to be infringing.
Such suits (or threats to bring suit) before the judiciary could affect competition no less than the potentially problematic patent applications prosecuted by Sanofi before the Israel Patent Office.
Similarly, non-Israeli jurisdictions have applied competition law in their analysis of motions to enjoin the infringement of FRAND-encumbered patents. For example, in the seminal case of ZTE v. Huawei2, the European Court of Justice held that, under European competition law, holders of standard-essential patents must satisfy certain requirements in the negotiation of licensing terms prior to seeking an injunction for infringement.
The logic of the Sanofi decision may result in Israeli courts imposing similar requirements, or even imposing liability under Israeli unjust enrichment law for failure to satisfy such negotiation requirements prior to seeking an injunction.
1. CA 2167/16 Sanofi v. Unipharm Ltd. (July 12, 2021)
2. Huawei Technologies Co. Ltd. v. ZTE Corp., C-170/13 ECJ (2015)
