How to buy a patent-owner in mid-litigation

In Eli Lilly & Company v Human Genome Sciences, Inc [2012] EWCA Civ 1185 the Court of Appeal for England and Wales was retro-fitted with Sir Robin Jacob in order to return to tidy up some loose ends in the straggling litigation between Eli Lilly and HGS over the patentability of a invention where the patent correctly identified the polypeptide as a member of the TNF ligand superfamily, listing a long description of its activities and uses, but without any back-up scientific data to support a description which the trial judge (Kitchin J, as he then was) depicted as being not so much as a description as a prediction based on knowledge of other members of the TNF superfamily.

In short, Kitchin J held the patent invalid here in July 2008 for lack of industrial applicability, insufficiency and obviousness; the Court of Appeal unanimously upheld his decision in February 2010 here,on the industrial applicability point and did not rule on the other issues.  After the Supreme Court -- to the surprise of many and the dismay of quite a few -- reversed this decision, it remitted the case to the Court of Appeal, here, so that the question of insufficiency of three of the claims could be considered: two had been ruled insufficient at trial and HGS appealed, arguing that they weren't, while a third was ruled sufficient at trial and Eli Lilly appealed on the ground that it wasn't.

The Court of Appeal allowed HGS'a appeal and dismissed Eli Lilly's. The reasoning of the Court appears to be based on well-established principles of claim construction rather than on any ground-breaking principles of law.

The decision in this case have been music to the ears of GlaxoSmithKline, which purchased HGS only last month. The patent in this case, for Neutrokine-α, is said to have an important role to play in dealing with autoimmune diseases and B-cell cancers. While the purchase of a patent-based company while it is in the middle of protracted litigation is always a risk, the risk was minimised here by the fact that the case was, unusually, on its way down to the Court of Appeal following a ruling from a superior court rather than on the way up to it, which both limited the scope of the Court of Appeal's decision-making and made it easier for GlaxoSmithKline to refine its purchase plans.