The Secretary of State for Health & Anor v Servier Laboratories Ltd & Ors

The tort of causing loss by unlawful means requires:

1. unlawful means directed towards a third party;
2. conduct actionable by that third party, or which would be actionable if loss had been suffered; and
3. an intention to injure the claimant.

The English health authorities claimed damages from Servier concerning the alleged dishonest procurement, defence and enforcement of a European patent relating to perindopril. Alongside competition law claims, the claimants alleged that the deceit practised on the European Patent Office and the English courts constituted unlawful means causing economic loss through delayed generic entry and higher reimbursement costs.

Servier applied to strike out that tort claim. The central issue was whether dishonest representations to a patent office or court could constitute unlawful means where they did not interfere with that third party’s freedom to deal with the claimants.

1. The application was granted. Paragraphs 73–78 of the Particulars of Claim, alleging the tort of interference with economic interests by unlawful means, were struck out.
2. The authoritative analysis in OBG Ltd v Allen [2007] UKHL 21 identified three elements: unlawful means towards a third party; actionability by that third party, or actionability if loss had been suffered; and an intention to injure the claimant.
3. The relevant ratio of OBG Ltd v Allen was that unlawful means consist of acts intended to cause loss by interfering with the freedom of a third party to deal with the claimant. The majority’s reasoning required the tort to remain within careful limits.
4. The claimant’s case assumed that Servier had made the alleged dishonest representations. Even on that assumption, the European Patent Office and the English courts had not had their freedom to deal with the claimants interfered with. The pleaded conduct therefore fell outside the tort.
5. The earlier decision in Lonrho plc v Fayed [1990] 2 QB 479, upheld on appeal at [1992] 1 AC 448, did not require a different result. Its limited treatment of actionability was explained by the state of the law before OBG Ltd v Allen.
6. The approach was reinforced by Emerald Supplies Ltd v British Airways plc [2015] EWCA Civ 1024. Extending the tort to losses caused by dishonest patent conduct would circumvent the legislative balance established by the statutory patent and competition regimes.
7. The unresolved question whether the European Patent Office or the High Court could have sued in deceit was not decided, since it was not the basis of the application and had not been fully argued. The strike-out was nevertheless appropriate because the issue decided was a clear point of law and the claim was bound to fail.