Arrow Pharmaceuticals Limited v Merck & Co., Inc.

Such costs are to be taxed if not agreed by the parties.' The respondent: '(a) The Respondent pay the Applicant's costs of the issues finally determined against the Respondent in these proceedings or relating solely to the validity of claims of the Patent which were abandoned by the Respondent in making the amendments referred to in order 1 of the orders of 8 October 2004.

(b) The Applicant pay the Respondent's costs of the issues finally determined against the Applicant in these proceedings or relating solely to the issues raised by the Applicant but not pursued at trial.

(c) Costs of the issues not yet decided by the Court be reserved. Such costs are to be taxed if not agreed between the parties.' 3 I need not set out the issues in the case, which have been dealt with in the reasons for judgment, nor the detail of the submissions of the parties. I have been referred to a number of relevant authorities. 4 The applicant sought revocation of the patent over the opposition of the respondent and has succeeded. Subject to special factors it is entitled to the general costs of the action. The respondent has defended an invalid patent. The failure of the applicant to succeed on all issues is not sufficient to displace that principle. Furthermore, I agree with the applicant's submission that the mere abandonment of particulars of invalidity does not necessarily carry with it any costs consequences. The refinement of issues by abandonment of some is a necessary feature of this kind of litigation and will often have beneficial consequences for the conduct of the case. I do not agree that any special order is required in relation to the issue of lack of inventive step which was not decided. However, there are two aspects of the matter that require special consideration. 5 The first relates to the matter identified in the reasons for judgment, namely the abandonment of certain of the particulars of invalidity on the ground of lack of novelty concerning the actions of certain Australian practitioners. The applicant filed and served ten affidavits from four deponents which were not read at the trial. In addition, patient records relating to the deponents were to be relied upon at trial but were not. Those affidavits and patient records required special analysis and investigation on the part of the respondent for the purposes of both cross-examination and answer. In principle, the respondent is entitled to its costs of and incidental to work done in relation to or arising out of the service of those affidavits and patient records. 6 The second is the failure of the applicant to establish the ground of lack of entitlement and a related ground of false suggestion. I agree with the submission for the respondent that these grounds raised distinct factual issues necessitating separate preparation and hearing time. There may well have been some overlap with other issues but that will have to be assessed on taxation. In my view the respondent is entitled to payment of its costs of those issues. 7 The costs of this argument will be costs in the proceeding. I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gyles.