INTELLECT-S Professionals' Patent Medicine

The amount of damages awarded to the patent-holder in the case is so far one of the largest in Russian patent dispute history.

The case, which took years of litigation and included a series of trials, appeals and reviews, began in September 2009 when the shareholders of the Institute for New Medical Technologies in Perm, Western Urals, voted to dismiss, over some unresolved issues, their CEO who happened to be a co-inventor of technology (which he patented in his name and commercialized) for the manufacture of a unique pharmaceutical, Profetal, produced by the institute.

The license agreement between the patent-holding CEO and his institute expired almost two years before his dismissal and was never extended or renewed after, which compounded the issue.
The institute went on manufacturing the drug notwithstanding. The patent-holding ex-CEO filed several actions, one in respect of trademark trespass (Case No. A50-5252/2010), and one in respect of his patent (Case No. A50-12809/2010).

Represented by INTELLECT-S attorney Maxim Labzin, the plaintiff sought an order to cease and desist the manufacture of the drug, and claimed damages for the entire period of the defendant's use of his trademarks and invention from the date of expire of the license agreement.

The defense pleaded exhaustion of rights and no guilt, so the court limited the damages to an insignificant amount covering only the period after the patent-holder's dismissal as CEO.

The plaintiff's subsequent appeals and cassation review succeeded, however, and the patent holder was awarded the relief he sought and damages equal to his royalties under the non-renewed license agreement, RUB 2,500,000.

The institute struck back at the end of 2011 when it sued its ex-CEO for damages (this very RUB2.5m) he had caused to it as its CEO by failing to renew the license agreement between himself as the licensee's director and himself as the patent-holding licensor, thus permitting the infringement on his own rights resulting in the plaintiff's damages (Case No. A50-25755/2011).

INTELLECT-S's Maxim Labzin, now counsel for the defense, argued that the damages claimed by and awarded to the patent-holder, were in fact the royalties that the plaintiff would have legitimately paid to him as licensor under the license agreement if it had been duly renewed.

The trial court rejected the argument of the defense, however, and awarded damages to the institute. The appeal court upheld the judgment and award, but the cassation review early in August 2012 ruled to dismiss the institute's action. The amount of damages awarded to the patent-holder in the case is so far one of the largest in Russian patent dispute history.

Intellectual Property, IP Disputes, Patents

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