Mexichem UK Ltd v Honeywell International Inc  EWCA Civ 473 – Will a broad Arrow declaration fly?
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An Arrow declaration is a form of discretionary relief granted by UK courts declaring that a product or process would have lacked novelty, or been obvious, at a specific point in time. In contrast to declarations of non-infringement, an Arrow declaration can, in certain circumstances, be sought to achieve commercial certainty in relation to a pending patent application. Arrow declarations therefore effectively preclude future infringement proceedings arising from a patent whose claims encompass the subject of the Arrow declaration on the basis that such a claim would be invalid.
In Mexichem, the Court of Appeal decided that HHJ Hacon was right not to strike out (nor give summary judgment against) a claim for an Arrow declaration. This decision is of interest as it is an extension of a developing area of law – both in being an Arrow declaration being sought outside of pharmaceutical patents and in being a generalised one, not tied to a specific product. In light of the Court of Appeal’s decision, the trial judge will decide whether to grant the Arrow declaration sought by Mexichem.
In the UK, Honeywell owns a series of patents for compounds used in refrigeration systems (typically for car air-conditioning). Alongside these patents, Honeywell also had divisional applications that were undergoing examination by the European Patent Office.
Mexichem, seeking to achieve commercial certainty to market certain compounds in the UK for use in mobile air-conditioning systems, brought proceedings to revoke the six Honeywell patents and sought an Arrow declaration as a countermeasure against the divisional patents. Through this declaration, Mexichem relied on a specific piece of Japanese prior art (the Inagaki patent) to establish that at the priority dates of the patent applications, it was obvious to use the relevant compounds in producing refrigerants for mobile air-conditioning systems. If successful, any infringement proceedings launched by Honeywell could be met with a Gillette defence; either the product must be excluded from the claims or the patent was invalid.
Honeywell sought to strike out the Arrow declaration by arguing that the proposed declaration was too broad; it did not relate to any specific product or process, and as a result, would lack utility. In the alternative, Honeywell applied for summary judgment on the basis that Mexichem had no real prospect of success in obtaining an Arrow declaration.
At first instance, HHJ Hacon refused both strike-out and summary judgment and Honeywell took the issue to appeal with two key submissions: i) HHJ Hacon had been mistaken in concluding that an Arrow declaration “of extreme breadth” could still serve a useful purpose and ii) obviousness could not be delineated into a series of steps and dealt with piecemeal. Such an approach would provide Mexichem a platform from which to launch step-by-step obviousness arguments contrary to case law (see Technograph Printed Circuits Limited v Mills & Rockley (Electronics) Ltd  RPC 346).
Mexichem, supported HHJ Hacon’s reasoning arguing that the Arrow declaration sought was appropriate given the wide scope of the claims of the patents in suit. Further, Mexichem alleged that Honeywell, through separate German proceedings, was seeking to establish a monopoly in the broad concept of using the claimed refrigerants in mobile air-conditioning systems.
Court of Appeal’s Judgement
Floyd LJ held that to apply for an Arrow declaration, it is not necessary for an applicant to have a fully formulated product description, or for the applicant to even have a product in production. Rather, the applicant need only show that it would be useful for specified features of a product to be declared old or obvious. Floyd LJ noted that while the breadth of an Arrow declaration may well affect its usefulness, this is a matter of degree, and one ultimately for the trial judge to assess. Therefore, for the purposes of a strike out application, it was sufficient for Mexichem to show that there existed a real prospect of establishing its case at a trial.
Turning to Honeywell’s argument that the grant of broad, general declarations might lead the court into a step-wise obviousness analysis, Floyd LJ confirmed that a step-wise analysis would be considered unfair in many cases. However, where research programmes with clearly foreseeable patterns are concerned, it may be legitimate to consider a series of steps that a skilled person would take where “the steps … can readily be ascertained without the taint of hindsight”, per Lord Hodge in Actavis Group PTC EHF and others v ICOS Corporation and another  UKSC 15. Floyd LJ therefore held that it is open to Mexichem to argue that an Arrow declaration in connection with a particular step (for instance the step of deciding to use a refrigerant compound in an air conditioning system) would serve a useful purpose because a step-by-step analysis is legitimate in considering research programmes directed to testing a new refrigerant.
In the circumstances, Floyd LJ also considered that Mexichem should be allowed to pursue the broadly cast declaration at trial because it was possible that no step-by-step analysis would be needed as Honeywell was seeking to protect an inventive concept pitched in similarly broad terms; the broad idea of using the compounds in question as refrigerants. In particular, the court noted instances in German proceedings where Honeywell had already attempted to enforce that broad inventive concept. Hence, it follows that an Arrow declaration in broad terms would demonstrate utility in fighting off claims to protection commensurate to its scope.
Honeywell also referred to the fact that the court would have to adjudicate on the inventive concept at trial in any event. This, Honeywell argued, was further affirmation that an Arrow declaration would serve no useful purpose. Floyd LJ rejected this argument because it could not be assumed that this would be the case as Mexichem had asserted that Honeywell was pursuing a strategy designed to shield its patents from scrutiny, which, for the purpose of this interim decision, it was assumed Mexichem would succeed in establishing. Therefore, an Arrow declaration would provide Mexichem with the means of ensuring that the inventiveness of broad inventive concept is determined whatever steps are taken by Honeywell to seek to remove those issues from the scrutiny and adjudication by the court.
The Court of Appeal’s decision provides further insight as to when the courts are willing to entertain an application for an Arrow declaration. In particular, the court decided that, in principle, an Arrow declaration sought in broad terms and not limited to a specific product/process could serve a useful purpose. This confirms that Arrow declarations can still be usefully sought where a party seeking to achieve commercial certainty does not have a fully developed product or process and also where a patentee is seeking to protect a broad alleged inventive concept.
The decision is also a practical confirmation that Arrow declarations are tools that litigants can use in any technical field and not just in the sphere of pharmaceutical patents where they had originated.
This article was co-authored by Thomas Kwoh.