Brazilian Superior Court Of Justice Stops Patent Term Extension Attempts 11/05/2018 by Intellectual Property Watch 4 Comments Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window) The views expressed in this article are solely those of the authors and are not associated with Intellectual Property Watch. IP-Watch expressly disclaims and refuses any responsibility or liability for the content, style or form of any posts made to this forum, which remain solely the responsibility of their authors. By Pedro Marcos Nunes Barbosa In April 2018, the Brazilian Superior Court of Justice (STJ) ruled on a controversial patent term extension scheme, for the third time since Brazil adopted TRIPS compliant legislation in 1996. The first ruling on this topic, upheld by the STJ, was decided, unanimously, in the year 2009 (docket REsp 960.728, Justice Andrighi). In that case, a famous agrochemical multinational company sought an exotic interpretation of the impacts brought by the minimum deadline granted to a patent, since the WTO’s annex treaty imposed the uniform extension of 20 years. In other words, although the agrochemical company had obtained its exclusivity right in a pre-TRIPS context (where Brazilian Law guaranteed a 15 years property right), but unsatisfied, after the Agreement was implemented, the plaintiff requested a judicial pass for a five year extra period of competition absence. Pedro Marcos Nunes Barbosa Hence, the ruling was quite simple: there should be no extension since the new Law could not impact in an ex tunc manner. This case law was applied by the same Superior Court in several another appeals, preventing hundreds of patent owners from delaying the benefits of public domain to society. Nonetheless, in 2010 the same STJ (docket REsp 1.145.637, Justice Vasco della Giustina) analyzed the attempt of a big pharma company that attempted to receive one extra year of exclusivity so that it could continue to exclusively market its drug Diovan, for the treatment of hypertension. Here the patent owner proposed to combine the exceptional and polemical architecture of the pipeline patents (granted without the analysis of the Brazilian Patent Office – INPI), with the 12 month period of the priority right (granted by the Paris Convention), so that the 20 year deadline could be counted from the second filing date instead being from the first as the Brazilian Law stipulates. In this ‘clever’ proposal, the total duration of the exclusivity right would reach 21 years (while, again, the Brazilian Patent Law determines the limit of two decades and no more), but the STJ did not agree with the Swiss company opinion. Here, again, the message was quite direct: the 20 year period should be counted from the first filing date and an exceptional institute—such as the pipeline one—should not allow creative interpretations that would only favor the patent owner, but that would be prejudicial towards a free market economy. This case law was applied by STJ in several other appeals, including in the famous Viagra (docket REsp 731.101, Justice Noronha) litigation. Therefore, when the mailbox (docket 1.721.711, Justice Andrighi) leading case (the third major patent deadline interpretation discussion) reached the STJ, the atmosphere of the TRIPS and pipeline history could be considered influential to the ruling of the same Superior Court, considering the need to maintain a coherent jurisprudence. Attending to such orthodox thought and behaving in a predictable and steady manner, the multinational’s attempt to postpone the public domain period was unsuccessful. Considering the facts of the case, the new precedent from the STJ decided if a multinational pharmaceutical company holder of a patent that protected a technology known as Soliris, for the treatment of a disease called paroxysmal nocturnal hemoglobinuria, should be awarded with a “bonus” exclusivity extension of more than five years. As a matter of fact, the dispute between INPI and the North American company was limited to the following legal frame: (a) the mailbox system is an exceptional and temporary one; (b) BIPL determined that the term extension of the mailbox system would be until 20 years from its filing (article 40, caput); and (c) the INPI violated the deadline of deciding the patent’s merits since the BIPL determined that this kind of exclusivity should have been ruled until the 31st December 2004 (article 229-B). Considering that there was no dispute of the fact related to item ‘c’, the Soliris patent holder in the lawsuit registered its position that a solution should be reached by the violation of item ‘b’ above, applying another form of counting the term extension (article 40, sole paragraph): 10 years from the grant date. Since this patent had been filed in 1995 and, in the date of the STJ ruling, 23 years had passed without a competitor entering the market, it would be quite hard for the patent holder to prove any damages suffered by the known INPI backlog. Thus, the two messages of the Superior Court were equally straight and clear: (i) one wrong does not give legitimacy to a second one; and (ii) patent term extensions shall not be granted. On the other hand, although the attempt to extend patent term was defeated by a new and unanimous decision of the STJ, it would be a mistake to consider that the multinational was not victorious in obtaining a de facto exclusivity, while the litigation was pending trial. Since the Brazilian law offers a harsh civil liability (articles 44 and 210 of BIPL) for those who exploit a patented technology during the exclusivity term, and there was a controversy between the private and the public party, the patent owner was not disrupted by any competitor (and those were probably frightened by the result) after all. To summarize the last decade of Brazilian Superior Court of Justice judgements on patent term extension matters, two conclusions can be reached: (1) in Brazil, big pharma/agrochemical companies are much like Charles Dicken’s famous character Oliver Twist: “Please Sir, I want some more!”; and (2) while IP lawyers should be commended for their creativity in attempting to obtain patent term extensions, the STJ has consistently ruled against such attempts, always noting that a patent impacts several actors of society: (i) the inventor; (ii) the patent holder; (iii) the State; (iv) consumers; (v) competition; and (vi) the environment. The proper solution for such cases cannot be favorable only for a party (or two).  IP Law, Civil Law and Commercial Law Professor at the Catholic University of Rio de Janeiro (PUC-Rio). Doctor (Commercial Law – University of São Paulo – USP), Master (Civil Law – State University of Rio de Janeiro – UERJ), and Specialist (IP Law – PUC-Rio). Managing Partner at Denis Borges Barbosa Attorneys. firstname.lastname@example.org.  It is important to notice that there were some previous cases ruled in a different manner by the STJ, usually attending to procedural arguments (and not merit ones) to maintain patent term extensions obtained by multinational companies in (federal) Trial or Court Level judgements. This case analyzed the merits of the discussion and represented an overruling of the former jurisprudence.  Exceptional, since the Brazilian Industrial Property Law (9.279 – BIPL) of 1996, limited this protection for technologies subject to a special and simplified procedure, during the period of vacatio legis until 1997, designed for pharmaceutical and agrochemical industries. Due to political decisions, since 1945 Brazil did not recognize patent pleas for agrochemical or pharmaceutical products, and without any binding international commitments, the 96’ BIPL generously sought to retrospectively maximize TRIP’s standards. The only important limitation for this expedite procedure was that the technological product was not available for purchase anywhere (such as the novelty criteria it was constructed to an international standard).  Polemical, since the majority of Brazilian IP doctrine hold the opinion that it collides with the Brazilian Constitution, and the Attorney General filed, in 2009, towards the Supreme Federal Court (docket ADI 4234) an unconstitutionality plea that is still pending decision.  This is another exceptional institute (although compliant to TRIP’s provisions) that allowed that patent applications filed since 95’, containing technological subject matter (e.g. pharmaceuticals and agrochemical products) that were forbidden by former BIPL/71, to be decided by the new BIPL/96 standards. Since those pleas were separated and waited the vacatio legis period, they were called mailbox pleas. Different from the pipeline provisions, there were no important limitations and neither was it subject to an expedite procedure.  “An invention patent shall remain in force for a period of 20 (twenty) years, and a utility model patent for a period of 15 (fifteen) years from the date of filing.”  “The term shall not be less than 10 (ten) years for an invention patent and 7 (seven) years for a utility model patent, beginning on the date of granting, unless the INPI has been prevented from examining the merits of the application by a proven pending judicial dispute or for reasons of forcefmajeure.”  This BIPL article is object of two unconstitutionality pleas towards the Supreme Federal Court – STF (docket 5061 and 5529, Justice Fux) – that are pending trial.  “The patentholder is assured the right to obtain indemnification for improper exploitation of the object of his patent, including that which occurs between the date of publication of the application and the date of granting of the patent.”  “Losses of profits shall be determined using the most favorable criterion to the aggrieved party, among the following: I. the benefits that the aggrieved party would have made if the violation had not occurred; II. the benefits made by the perpetrator of the violation of the right; or III. the remuneration that the perpetrator of the violation would have paid to the titleholder of the violated right throughout the granting of a license that would have allowed him to lawfully exploit the property.” Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window) Related "Brazilian Superior Court Of Justice Stops Patent Term Extension Attempts" by Intellectual Property Watch is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.