Teva UK Limited & Anor. v Novartis AG

Permission to amend shortly before trial is discretionary. The court must balance prejudice to the applicant, the opposing party and other court users, giving strict weight to procedural compliance, timing and the protection of the trial date. A new case must be properly formulated, supported by a factual basis and have a real, rather than fanciful, prospect of success.

In an uncertain and developing area, especially on the discretionary grant of an Arrow declaration, the court should generally determine arguability without conducting a mini-trial. The possible usefulness of a declaration in foreign proceedings is not automatically irrelevant, particularly where it may affect the UK market or supply chains. The patentee’s conduct may also be a relevant discretionary factor.

Teva sought permission to replace the existing basis of its claim for Arrow declaratory relief in the Teva Action. Novartis had withdrawn the UK designation of the patent shortly before trial, announced that it would discontinue its infringement claim and declined to submit to judgment. Teva proposed relying on the commercial usefulness of a declaration, the effect of related European proceedings, German law and possible supply-chain consequences.

The application was opposed as too late, inadequately pleaded and unsupported by compliant evidence. The central issues were whether the amended case was arguable, whether it had a real prospect of success, and whether allowing it would make a fair trial within the existing trial window impossible.

1. Permission granted. Teva was permitted to amend its pleadings, subject to further particularisation and corrections to its evidence. The proposed two-day hearing was confined to discretionary issues concerning the declaration.
2. Under CPR 17.3, the overriding objective requires a balance between injustice to the applicant and prejudice to the opposing party and other court users. A very late amendment attracts a heavy burden. The court must consider the amendment’s formulation, procedural compliance, explanation for delay, strength of the proposed case, prejudice and effect on the trial date.
3. The proposed case had to be coherent and properly particularised. A new claim or defence must have a real, rather than fanciful, prospect of success, assessed without conducting a mini-trial. In an uncertain and developing area, it was ordinarily preferable to develop the law on facts established at trial rather than hypothetical facts.
4. The authorities on Arrow declarations establish a pragmatic discretion focused on whether the declaration would serve a useful purpose. A declaration sought solely for foreign proceedings would rarely suffice, but foreign effects may be relevant where they bear directly on the UK market or supply chains. The patentee’s unusual conduct may also be placed into the discretionary balance.
5. Teva’s pleading and evidence had defects, including inadequate particularisation and non-compliance with PD57AC. Those defects were curable. The German-law issue appeared narrow, and the proposed trial could fairly be accommodated within the existing window. Whether the evidence would ultimately justify an Arrow declaration, including whether an uncontested UK decision would add sufficient value, was reserved for trial.
6. If Teva succeeded on discretion, the trial judge would decide when and how any technical issues should be determined.