EOFlow v Insulet (UPC_CFI_597/2024)
Decision date:
22 July 2025
Osborne Clarke summary
- EOFlow is a medical device developer and manufacturer based in South Korea that makes insulin pumps. Insulet is also a medical device company based in the USA that makes a management system for the delivery of insulin. Insulet is the proprietor of a European Patent with unitary effect (EP 327). EOFlow made a revocation claim against Insulet's patent in the Milan CD, arguing lack of patentability pursuant to Article 138(1)(a) EPC and Article 65(2) UPCA, lack of novelty over various prior art documents, and lack of inventive step. Insulet also lodged a counterclaim for infringement.
- The revocation action (and Insulet's infringement counterclaim) was brought by EOFlow subsequent to Insulet's ex parte application for a preliminary injunction in the Milan CD and a second ex parte request before the Milan LD against the main European distributor of EOFlow's pump. The Milan CD rejected the preliminary injunction request but this was overturned by the Court of Appeal and the preliminary injunctions were ordered.
- Insulet also applied to obtain security for costs, arguing that EOFlow's financial position had deteriorated due to the outcome of litigation involving the same patent before the US courts and that insolvency was likely to occur in the near future. The Milan CD ordered EOFlow to pay a security deposit. At the interim conference in these proceedings, EOFlow declared that the security had not been paid and that the company was unwilling to proceed with payment. Insulet argued that a decision by default should be ordered as a result of the non-compliance with a court order. EOFlow insisted on an oral hear and Insulet requested a decision by default for the revocation action and infringement counterclaim.
- The Milan CD held that EOFlow's revocation action must be dismissed by default. The court noted that Rule 355.2 RoP only applies when the decision by default is given against the defendant and noted the difference between the use of the term "party" in Rule 355.1 RoP and the terms "claimant" and "defendant" in Rule 355.2 RoP. Thus, an action for revocation or infringement cannot be upheld on the merits solely to punish the defendant for procedural conduct. However, if the claimant omits a step that the court considered necessary to ensure the fairness of the proceedings and the proper balance of the parties' rights, the decision by default is based solely on non-compliance and results in dismissal of the case.
- Here, EOFlow was the claimant in the revocation action and therefore the requirements for a decision by default were met: i) non-compliance with a legally issued order by EOFlow; and ii) a request for a decision by default by Insulet. The Milan CD stated that EOFlow knowingly evaded an obligation imposed by the court, which impaired the trial and left Insulet with no option but to continue the legal proceedings in the revocation action without reasonable security for recovering foreseeable legal costs. The court held that its interpretation of the applicability of a decision by default due to non-compliance by the claimant was in line with the ratio behind Article 69(4) UPCA, which protects a defendant against an insolvent claimant.
- However, the court decided not to rule by default in the infringement counterclaim and instead dealt with the merits of the case. On the merits, the infringement action was held to be well-founded. After detailed analysis of the patent and the attacked embodiment, the court held that all of the features of claim 1 were infringed by EOFlow's pump – it fell entirely within the scope of the claim.
- The court ordered a permanent injunction in this case because of the likely risk of repetition (which can be presumed if one case of infringement has been shown). It was for the defendant to dispel the presumed risk of repetition and, in this case, EOFlow had not done so.
- Insulet was also awarded damages, with an interim payment of €230,000 ordered to be paid under Rule 119 RoP and Article 68 UPCA. The court also ordered corrective measures, ordering that EOFlow recall the infringing product from commercial customers and remove any infringing products from the market, and provide Insulet with information relating to the infringement.
- EOFlow was also ordered to bear the costs of these proceedings, with an interim award set at €200,000 under Rule 150.2 RoP. EOFlow also had to bear the costs of the preliminary injunction litigation, which totalled €162,292.
Issue
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