OXFORD GENE TECHNOLOGY LTD v (Claimant/Respondent) [2000] EWCA Civ 253

IN THE SUPREME COURT OF JUDICTURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CHANCERY DIVISION
MR JUSTICE PUMFREY
[2000] EWCA Civ 253Case No Case No.: 2000/2749Venue Royal Courts of Justice, Strand, London, WC2A 2LL
Between
OXFORD GENE TECHNOLOGY LTD(Claimant/Respondent)(1) AFFYMETRIX INC(2) AFFYMETRIX UK LTD(3) BECKMAN COULTER INC(Defendants/Appellants)
Before
Lord Justice AldousLord Justice BrookeLord Justice SedleyP.Prescott QC and Miss C. May ( instructed by Bird & Bird for the Claimant/Respondent)R.Miller QC, R, Meade and G. Pritchard (instructed by Bristows for the First and Scond Defendants/Appellants)Date 23 November 2000
[1]ALDOUS LJ: This appeal is against the judgment of Pumfrey J dated 1st August 2000. It was given in private. However the issues raised are important to practitioners and we have therefore decided that this judgment should be delivered in open Court.[2]Oxford Gene Technology Limited (OGT) is a company whose principal shareholder is Professor Southern of Oxford University. Affymetrix Inc is a substantial Delaware corporation based in eastern California. It is a market leader in the production of DNA microchips. The second defendant Affymetrix UK Limited is a wholly owned subsidiary of Affymetrix Inc. For the purpose of this judgment there is no need to differentiate between them and I will refer to them generally as Affymetrix.[3]OGT is the proprietor of European Patent (UK) 0 373 203 for an invention entitled "Method and apparatus for analysing polynucleotide sequences." I will refer to it as the patent. It was granted in 1994 and since 1995 has been under opposition in the European Patent Office. As yet no decision has been reached.[4]In July 1999 OGT sued Affymetrix for, amongst other things, infringement of the patent. Affymetrix denied infringement and counterclaimed for its revocation. There are also patent proceedings in the USA in respect of the US patent corresponding to the patent.[5]In September 1999 OGT gave notice of intention to seek amendment of the patent pursuant to section 75 of the Patents Act 1977 and subsequently served a Statement of Reasons. Affymetrix were the only opponents. Originally OGT contended that the court did not have a discretion to refuse the amendments and therefore the amendments had to be allowed, provided that new matter had not been added and the claims had not been extended. That view was consistent with the judgment of Laddie J in Kimberly-Clark Worldwide Inc v Procter & Gamble Ltd [2000] FSR 422. That judgment was reversed on appeal and the judgments of the Court of Appeal made it clear that section 75 gave to the Court a discretion to refuse amendments. OGT therefore accepted that the Statement of Reasons needed amendment. The most recent form, served on 1st September 2000, maintained the contention that the Court did not have a discretion, but if it did the discretion should be exercised in its favour.[6]We were told that at a hearing on 19th February 2000, Laddie J considered an application by Affymetrix seeking to compel OGT to amplify its pleading. The judge indicated during argument that amplification or disclosure seemed necessary. In the end the judge made this order for disclosure. "The claimant do on or before ... give disclosure by list of all documents relevant to the court's discretion to permit or refuse amendments of the patent in suit in accordance with the claimant's obligation of utmost good faith to put all relevant matters before the court."[7]The wording of that order appears novel and was the subject of discussion in this Court. However it seems clear that the judge had concluded that a general order for disclosure in respect of any document relevant to discretion was needed. Pursuant to that order, OGT served a list of documents. It stated:
"I have control over the documents numbered and listed here, but I object to you inspecting them: please see attached Schedule B which contains documents which the claimant objects to inspection of other than UK solicitors and counsel. I object to you inspecting these documents because: they contain legal advice of patent agents, solicitors and counsel in connection with the claimant's patent EP (UK) 0373203 and so are privileged from inspection. Limited inspection is only permitted to meet with the claimant's obligation of utmost good faith to put all relevant matters before the court."
There followed correspondence between the parties' solicitors and inspection by Affymetrix's solicitors. I shall have to come back to the effect of that correspondence.[8]This Court has not been shown the documents in Schedule B. There is a dispute between the parties as to their relevance and, I assume, as to whether the claim for privilege in respect of all the documents could be sustained. But those disputes are not relevant to this appeal which was argued upon the assumption that all the documents were of a kind to which privilege attached and that they were potentially relevant to the exercise of the Court's discretion when considering whether amendment should be allowed.[9]Having inspected the documents, solicitors for Affymetrix concluded that they needed help and advice from their clients. They therefore sought permission from OGT for wider disclosure. That was refused. Affymetrix therefore applied to the Court for an order permitting disclosure to Mr Vernon Norviel, Senior Vice-President, General Counsel and Corporate Secretary of Affymetrix Inc. He is the person who reports to the board on matters such as this litigation. They also sought permission to disclose the documents to Mr Philip McGarrigle, who is the in-house patent counsel of Affymetrix. He deals with the day-to-day matters of the litigation and reports to Mr Norviel. They also sought disclosure to William Anthony and Elizabeth Howard of Messrs Orrick, Herrington and Sutcliffe, who are the counsel conducting the patent litigation in the United States on behalf of Affymetrix. Also, disclosure was sought to Mr Michael Steinberg of Sullivan and Cromwell, who is a US attorney. His job is to act as co-ordinator on behalf of Affymetrix.[10]The application for further disclosure was supported by the witness statement of Mr Powell, a partner in Bristows, the solicitors who have the conduct of these proceedings on behalf of Affymetrix. I need not set out his explanations of the documents. It is sufficient to summarise his reasons for wanting a wider disclosure. Mr Powell said that the documents included material which Bristows believed to be relevant to the proceedings. He said that unless he was able to discuss the documents with the people referred to, he did not believe it possible to advise Affymetrix properly on the amendment issues, the issues relating to the validity of the patent and on procedural matters, such as amendment of the pleadings.[11]The application for wider disclosure was resisted. One of the grounds relied on was that disclosure to United States lawyers would mean that the privilege in respect of those documents in the United States would be lost. That was disputed by Affymetrix who contended that because there had been disclosure to the English lawyers, no claim for privilege could be sustained in the United States. OGT disagreed. It was for that reason that there were placed before this Court and the judge, witness statements of experts in the United States law relating to whether a claim for privilege in the United States was sustainable.[12]The dispute came before Pumfrey J. As I have said his judgment was given in private, but it would not be right for me to go on and consider the matters raised on appeal without setting out the conclusions that this experienced patents judge arrived at. I suspect his decision to sit in private and give his judgment in private was influenced by the Bourns Inc v Raychem Corporation litigation which came up to this Court twice, although only one judgment is reported ([1999] FSR 641).[13]The judge held that the form of the list of documents and inspection by the Affymetrix lawyers resulted in loss of privilege in this country. He said:
"Once production is made and inspection provided, however limited, the privilege has been lost even if the purpose of the disclosure is to make available to the opposing party material which may be used to criticise the patentee's conduct and even if the disclosure is made in confidence to a limited class of people."
The judge then went on to consider whether wider disclosure should be allowed. In doing so, he was, I believe, exercising the inherent power of the court to take precautions to prevent unjust hardship to a party.[14]A plank of OGT's case was that disclosure to US lawyers would destroy any claim to United States privilege they had. As to that

the judge said:

"However tempting it may be to second-guess the United States court, it seems to me only necessary for me to record that the arguments in favour of a loss of privilege in the United States are strong, but not conclusive. There is no doubt that further disclosure of the documents to the US entities will, however, make what is, I consider to be, a difficult position for the patentees substantially worse and will, in all probability, be fatal to the claim for privilege in the United States."
[15]The judge postulated that it followed that further disclosure would be contrary to the interests of OGT and that the public interest required such detriment to be minimised so as to encourage frankness by patentees seeking to amend. He concluded that the interests of justice did not require further disclosure to be made. He said:
"The defendant's English legal advisers are highly experienced. The jurisdiction on amendment is highly idiosyncratic, and it is unlikely that the defendant can have useful input into the factors affecting the exercise of a discretion to amend in the United Kingdom. It seems to me that the fact of the matter is that the American advisers will depend upon the English advisers for an assessment of the value and weight to be attached to and the use which can be made of the documents. In those circumstances, I am far from satisfied that it can be in any sense necessary for further disclosure to take place, particularly having regard to the collateral effects of such a disclosure. Furthermore, I went through the list of proposed uses and proposed disclosures which Mr Powell wishes to make of the documents in question, since these seem to me to go far wider than any investigation merely of the factors affecting the exercise of the discretion to amend. They seem to me, on the contrary, to really form the basis, among other things for a challenge to the adequacy of the disclosure made both in the United States and in the United Kingdom and for other purposes. I am conscious that, in this conclusion, I am preventing one representative of the defendant from seeing the documents at all. This is an exercise of the discretion recognized since Warner Lambert v Glaxo . In that case, as is well known, disclosure was ordered to one controlling intelligence in the company while the Court of Appeal undoubtedly accepted that there might be circumstances justifying no disclosure at all. I consider that where, as here, there is potential for a loss of privilege, this is such a case as the Court of Appeal was contemplating might exist where the inconvenience of ordering further disclosure outweighed the benefit either to the defendant or to the public of making the wider disclosure. So far as the public interest is concerned, I should observe that the amendment has been opposed by the defendant only, and further, I must consider that the very highly experienced advisers who advised the defendant, together with the technical experts whom they employ, can safely guard the public interest as well as that of their client."
[16]The judge decided that, even though privilege had gone, he had a discretion to limit use of the documents to the purposes for which they were disclosed, namely for the purpose of amendment proceedings. He concluded:
"I can see no reason why documents which were privileged and which were disclosed for a limited purpose should become available for any purpose in these patent infringement proceedings. I do not believe that there was a formal application before me for leave to use the documents in this way, but it was clear from both counsels' addresses to me that it was a matter with which I should deal and I have expressed my view accordingly."
[17]Affymetrix appealed. They contended that the judge was wrong to refuse the wider disclosure sought and to confine use of the documents to the amendment proceedings. OGT served a respondent's notice. They contended that they had not waived privilege. They also submitted that the wider disclosure sought should not be ordered because the documents could have no effect on the outcome of the court's exercise of discretion under section 75. This I will refer to as the Article 138 issue. I will deal with those issues in turn, but before doing so I will set out some basic principles.[18]Patents are twenty year monopolies granted by the State. They are justifiable upon well-known grounds. It is therefore not surprising that when a holder of such a monopoly seeks to validate his patent by amendment under section 75 of the 1977 Act, the court should have the power to refuse such an amendment or impose conditions to safeguard the public in cases where there has been an abuse by the patentee of his monopoly. That is particularly so as any amendment back-dates to the date of grant (see section 75(3)). All types of abuse can result in a refusal to exercise the discretionary power given by section 75 to allow amendment. Each case depends upon the facts, but the most common are those referred to in Smithkline and French Laboratories Ltd v Evans Medical Ltd [1989] FSR 561 at page 569 as approved by this Court in Hsiung's Patent [1992] RPC 497 at 522.[19]It is also not surprising that when a patentee seeks amendment, the court requires him to place before it the relevant facts and matters upon which it is to exercise its discretion. That is particularly appropriate where some amendment proceedings are conducted without the presence of an opponent. The obligation is akin to that required by a party seeking an ex parte injunction or Mareva relief. That can be illustrated by taking a typical case where a patentee seeks to amend under section 75 to strengthen his patent against an attack based upon a particular piece of prior art. Thus his Statement of Reasons will give that as the reason for amendment. It follows that the Court is concerned with whether to exercise its discretion to allow amendment for that reason and the patentee must turn his mind to that issue so as to be able to inform the court of the relevant facts. Any disclosure should be limited to that issue and only ordered if necessary. An opponent may raise other grounds of abuse, but they should be properly particularised before wider disclosure becomes potentially necessary.[20]From the transcript of the hearing before Laddie J, it seems that practitioners believe there to be an obligation upon a patentee to trawl through his documents to see whether they are relevant to the exercise of the discretion, whatever the reason put forward for the amendment. That results in considerable expense and is not required under modern principles. The obligation of good faith requires the patentee to put forward correct reasons for the amendment. If there be facts relevant to the exercise of the discretion for those reasons then those facts need to be put before the court.[21]There is no obligation upon a patentee in amendment proceedings to waive privilege in respect of any document. In so far as my judgment in Bonzel v Intervention Ltd [1991] RPC 231 has led to that belief - it was wrong. In his judgment in the Kimberly-Clark case, Laddie J said at page 224 that the obligation upon a patentee who sought amendment was to make full and frank disclosure "was so strong that effectively the patentee was put under pressure to waive his entitlement to legal professional privilege." I suspect that statement reflects a body of opinion among practitioners. For the reasons I have given it is based upon a misapprehension as to the obligation on a patentee seeking amendment. It is also contrary to the law relating to privilege. As was pointed out in W.C. Wentworth v J.C. Lloyd (1864) 10 H.L.C. 589, the maintenance of privilege does not enable the court to draw an adverse inference against the person who maintains his privilege. The obligation to disclose material facts and matters does not require the disclosure of documents and I can see no warrant for a patentee throwing all his documents at the court as a policy of caution. Of course, a patentee's case may best be advanced by waiver of privilege, but the decision whether to waive privilege is one for him and not for the court. Certainly the obligation to tell the court of the facts material to the reason for amendment cannot act as a hidden obligation to waive privilege. Did OGT waive privilege in the documents referred to in Schedule B of the list?[22]As I have said, the judge concluded that privilege had been waived. Mr Prescott QC, counsel for OGT, challenged that conclusion. He started his submissions by drawing to our attention certain passages in the Hsiung case and also to that part of Laddie J's judgment in the Kimberly-Clark case that I have referred to. He submitted that it was playing with words to suggest that the patentee was not compelled to give up his right to maintain privilege when seeking to amend. For the reasons which I have already given, I disagree.[23]Mr Prescott then drew to our attention British Coal Corporation v Dennis Rye Ltd [1988] 1 WLR 113, Goldman v Hesper [1988] 1 WLR 1238, and the Bourns v Raychem case. All those cases were, as Mr Prescott pointed out, cases where privileged documents had been produced, but the court had held that the privilege had not been lost. Thus he submitted, disclosure did not in all cases mean that the privilege had been waived for all purposes. There was no logical reason why disclosure in this case, where it was limited to inspection by lawyers in confidence, should amount to waiver of privilege, if the disclosure did not amount to a waiver of privilege in the cases referred to.[24]Mr Miller QC, counsel for Affymetrix, submitted that the judge had come to the right conclusion for the right reasons. He submitted that there were only two species of controlled waiver of privilege, namely partial waiver where privilege was waived in part of a document and limited waiver where the documents were disclosed only for a particular purpose. The cases referred to by Mr Prescott were of that later type. In this case OGT were seeking to rely upon another control, namely a disclosure to a limited class of persons. That was not permissible. If it were, a party could dictate the team which the other party could use at trial. He submitted that privilege arises in the context of litigation. Privilege relieves a party from the obligation to disclose a document to his adversary. If privilege was waived, then there was an obligation to disclose the document to the adversary who was free to see the document and use it for the purposes of the litigation, subject to any restriction imposed by the court under its inherent jurisdiction.[25]Mr Miller went on to submit that the decision to waive privilege was that of the party to the litigation. Whether or not any act amounted to waiver was the decision of the court. The criteria to be applied was justice and fairness.[26]I believe those submissions of Mr Miller are correct and are supported by British Coal Corporation case and Goldman v Hesper . The British Coal Corporation case concerned documents that had been handed to the police to assist them with a criminal investigation. They were supplied to the defence in accordance with the Attorney General's guidelines. The Court of Appeal held that the documents were privileged and remained privileged as their disclosure had been for a particular purpose, namely the criminal trial. That did not constitute a waiver of the privilege to which the documents were entitled in civil proceedings. As Neill LJ said at page 1122:
"It would be contrary to public policy if the plaintiff's action in making the documents available in criminal proceedings had the effect of automatically removing the cloak of privilege which would otherwise be available to it in the civil litigation for which the cloak was designed."
[27]If, as I believe, it is for the court to decide whether privilege has been waived, then the decision must be determined upon principles of justice and fairness. For example Templeman LJ in Great Atlantic Insurance Co v Home Insurance Co [1981] 1 WLR 529 held that generally disclosure of part of a document results in waiver of privilege in the whole document. To conclude otherwise could result in the case being decided on misleading and incomplete evidence. The exceptions, where the part not disclosed deals with a different subject matter (see page 536F) and disclosure in interlocutory proceedings (see page 537F), are examples of instances where justice and fairness do not require that privilege be lost. Of course, it is a prerequisite of a claim to privilege that the document is confidential in the sense that it is not in the public domain (see page 537H).[28]Against that background of law, I return to the facts. The service and terms of the list of documents which I have set out have to be considered together with the correspondence passing between the solicitors. Both the terms of the list and the correspondence made it clear that there was to be no disclosure by OGT to its adversary, Affymetrix. As Mr Miller accepted, Bristows were and remained under a duty of confidence not to disclose the documents to their clients or to others. Thus the documents remained confidential, a prerequisite to a claim for privilege.[29]By letter dated 30th May 2000, solicitors for OGT wrote stating that their client would be "disclosing highly confidential privileged documents. In line with previous proposals put forward by yourselves ...., we would propose that disclosure is confined to named members of your firm and UK counsel ..... we should be grateful for confirmation of your agreement to our proposal on disclosure ...." By letter of the same date, Bristows wrote agreeing to the proposal on a provisional basis. When they saw the list, Bristows wrote on 5th June making it clear that it was likely that further disclosure would be necessary. That, as Mr Miller pointed out in his written submission, was inconsistent with accepting OGT's position.[30]By letter dated 7th June 2000, OGT's solicitors wrote stating that they failed to see why any widening of disclosure was required. It was their view that disclosure made on amendment involved waiver of privilege to enable the UK court to exercise its discretion but their clients were particularly anxious that Affymetrix and their US lawyers, should not have access to the documents. By letter dated 21st June 2000 Bristows set out their view that privilege had been waived and that wider disclosure was necessary. The solicitors for OGT replied on 23rd June stating that the documents remained privileged. They said that the disclosure to lawyers upon terms did not amount to a general waiver of privilege. At that stage the battle lines were drawn and the issue between the parties was taken to the court.[31]Affymetrix relied upon the terms of the list and the letter of 7th June 2000 written by OGT's solicitors to mean that there had been a waiver of privilege. However those two documents have to be read as part of the whole correspondence which show that OGT never intended to waive privilege by disclosure to an adversary. The disclosure to Bristows was upon terms that there would be no further disclosure. That was never accepted by Bristows. The inspection that took place was an exploratory step towards an agreement. It failed. There was no disclosure to OGT's adversary, nor agreement that there should be such a disclosure. The documents remained confidential.[32]The disclosure, better named attempted disclosure, by OGT did not amount to disclosure of any document to an adversary and in my view did not amount to a waiver of privilege. The list was served in an attempt to arrive at agreement. That did not, in documents still confidential, succeed. In those circumstances justice and fairness does not require the court to hold that waiver of privilege occurred. To conclude that what happened amounted to a general waiver of privilege would be unjust. The Article 138 issue[33]The Court of Appeal judgment in the Kimberly-Clark case made it clear that the Court, when exercising its powers under section 75, had a discretion to allow amendment. Mr Prescott submitted that the exercise of that discretion was fettered by the terms of Article 138 of the EPC. It states:
"(1) Subject to the provisions of Article 139, a European patent may only be revoked under the law of the Contracting State, with effect for its territory, on the following grounds: (a) if the subject-matter of the European patent is not patentable within the terms of Articles 52 to 57; (b) if the European patent does not disclose the invention in a manner sufficiently clear and competent for it to be carried out by a person skilled in the art; (c) if the subject-matter of the European patent extends beyond the content of the application as filed or, if the patent was granted on a divisional application or on a new application filed in accordance with Article 61, beyond the content of the earlier application as filed; (d) if the protection conferred by the European patent has been extended; (e) if the proprietor of the European patent is not entitled under Article 60, paragraph 1. (2) If the grounds for revocation only affect the European patent in part, revocation shall be pronounced in the form of a corresponding limitation of the said patent. If the national law so allows, the limitation may be effected in the form of an amendment to the claims, the description or the drawings."
[34]The grounds of revocation in Article 138(1) equate to those set out in section 72 of the 1970 Act and Article 138(2) essentially corresponds to section 63(1) of the 1977 Act which is in this form:
" 63. -(1) If the validity of a patent is put in issue in proceedings for infringement of the patent and it is found that the patent is only partially valid, the court or the comptroller may, subject to subsection (2) below, grant relief in respect of that part of the patent which is found to be valid and infringed."
[35]Mr Prescott's argument proceeds as follows. Article 138(1) lays down the only grounds upon which European patents, such as this patent, may be revoked. Similarly Article 138(2) provides that if the grounds of revocation only affect the patent in part, revocation may only be pronounced against the invalid part. What Affymetrix is seeking to achieve by its opposition is to prevent OGT limiting its patent and thus bring about revocation in toto. To accede to that aim would have the result of preventing the court from giving judgment for the valid part of the patent, namely the patent as amended. Thus to give effect to Article 138(2) the court has to exercise its discretion under section 75 so as to permit the amendments, if they would have the result that patent would be valid. In essence the amendments expose the valid part of the partly valid patent. In those circumstances OGT are entitled to relief. That would be prevented if amendment was refused.[36]When considering the terms of section 75, it must be borne in mind that it is not one of the sections that are required by section 137 to be framed so as to have nearly as practicable the same effect in the United Kingdom as the corresponding provisions of the EPC. That is because post-grant amendment is not covered by the EPC and patents granted by the EPO are treated as if they were granted under the 1977 Act (see section 77). Be that as it may, the submission of Mr Prescott founders at the outset. Section 63 is concerned with a case where the patent is partly valid as is Article 138(2); whereas section 75 permits amendment to validate an invalid patent. That difference was exposed in Van der Lely NV v Bamfords Ltd [1964] RPC 54.[37]The invention for which a patent is granted is that specified in the claims (see section 125 and Article 69). Thus to decide whether an invention is valid, the court must consider the claims. If all of them are invalid, then there is no claimed invention and therefore the patent is wholly invalid. There is no part upon which the court could grant relief. The terms of the injunction could not be formulated nor would it be possible to conclude that there had been infringement, as that only arises if a person does an act in relation to "the invention" (section 60) which means the invention as claimed. There are cases, the Van der Lely case was one, where some claims are held invalid, but one or more are held valid. In that case, the grounds for revocation only affect the patent in part and relief can be given without amendment in respect of the valid part because both infringement and validity of the patent have been determined by the court.[38]Some signatories to the EPC do not permit amendment of a granted patent and they are not required to do so under the EPC. In this country not only is post-grant amendment allowed, but it is possible to validate an invalid patent by amendment. Thus a patentee who fights and loses because all his claims are invalid, can, in appropriate circumstances, amend to produce a valid claim.[39]We did not hear argument on the amendments sought by OGT, but on their face they appear to be of the kind designed to validate an invalid patent rather than to limit the patent to a part which is valid. Thus it would seem that the court would have to exercise its discretion under section 75 when considering the amendments. If the amendments had been of the kind which reflected the fact that one claim was valid, then section 63 could apply provided that the claim was infringed. In those circumstances the word "may" in section 63 might be construed in a permissive sense to give effect to the word "shall" in Article 138(2).[40]In Kimberly-Clark a similar submission to that advanced by Mr Prescott was made and rejected by this Court. I said at page 436:
"Mr Watson also submitted that to construe section 75 as providing a discretion to refuse amendment was in effect providing an additional ground of revocation to those set out in section 72 of the Act. That he submitted would be contrary to the EPC and against the guidance given in section 130(7). That submission is based upon a false premise. In this case Kimberly-Clark are seeking to validate by amendment a claim which, it is to be assumed, is invalid. Refusal of such an amendment does not amount to revocation any more than a Contracting State, which makes no provision for post-grant amendment, would be doing so by refusing amendment."
[41]It follows that Mr Prescott's argument fails for another reason. Affymetrix only seek to prevent the particular amendments sought. If they succeed, there will remain the questions of whether the patent as granted is valid or whether the grounds of revocation only affect the patent in part. If they only affect it in part, the Court will need to decide whether the part was infringed before the jurisdiction of section 63 (Article 138(2)) can be exercised. It follows that refusal of these amendments on discretionary grounds will not necessarily mean that the patent will be revoked and therefore the exercise of discretion would offend Article 138. If the patent is held to be partly valid, then OGT may be able to obtain relief pursuant to section 63 (Article 138(2)) in respect of the part held valid. Should there be wider disclosure?[42]As I have held that the documents remain privileged, this issue does not arise, but it would not be right to leave the judge's conclusion without giving my view as to its correctness.[43]The principles to be applied are those set down in Warner Lambert Co v Glaxo Laboratories Ltd [1975] RPC 354 at 360:
"If in a particular case it is right that disclosure of any facts should be made by one party to his opponent's advisers before trial, it must normally follow as a matter of course that the opponent should be entitled to know the facts so disclosed. His advisers are his agents in the matter, and strong grounds must be required for excluding the principal from knowledge, which his agents properly acquire on his behalf. But this principle must be subject to some modification if trade secrets are to be protected from disclosure to possible competitors. Suppose, for example, that in a case such as the Coloured Asphalt case the court makes an order for inspection of the kind which was made in that case and the plaintiff's advisers, having inspected the defendant's process, report that in fact no infringement has taken place. The whole object of the procedure would be defeated if the plaintiff could insist as of right on knowing the details of the defendant's process, and no useful purpose would be served by his doing so. Where a matter in question in an action, begin that matter in question in an action, being the matter upon which inspection or disclosure will throw light, is of a technical nature, the party seeking discovery may well require inspection by, or disclosure to, technical and professional advisers. If the matter be of a kind on which the party will be likely to be able with the aid of those advisers to form some kind of view of his own, it seems to me that he should normally be allowed to know as much about the facts as his advisers. If, however, the case were one of so esoterically technical a character that even with the help of his expert advisers the party himself could really form no view of his own upon the matter in question but would be bound to act merely upon advice on the technical aspects, disclosure to him of the facts underlying the advice might serve little or no useful purpose. In such a case a court might well be justified in directing disclosure of allegedly secret material only to expert or professional agents of the party seeking discovery on terms that they should not, without further order, pass on any information so obtained to the party himself or anyone else, but should merely advise him in the light of the information so obtained. Even so, if the action were to go to trial, it would seem that sooner or later the party would be bound to learn the facts, unintelligible though they might be to him, unless the very exceptional course were taken of excluding him from part of the hearing. Even where the information is of a kind the significance of which the party would himself be able to understand, it may nevertheless be just to exclude him, at any rate during the interlocutory stages of the action, from knowing it if he is a trade competitor of his opponent."
[44]To that should be added this passage from my judgment in Roussel Uclaf v Imperial Chemical Industries Plc [1990] RPC 45 which was cited with approval by Nourse LJ ([1990] RPC at 54). "Each case has to be decided on its own facts and the broad principle must be that the court has the task of deciding how justice can be achieved taking into account the rights and needs of the parties. The object to be achieved is that the applicant should have as full a degree of disclosure as will be consistent with adequate protection of the secret. In so doing, the court will be careful not to expose a party to any unnecessary risk of its trade secrets leaking to or being used by competitors. What is necessary or unnecessary will depend upon the nature of the secret, the position of the parties and the extent of the disclosure ordered. However, it would be exceptional to prevent a party from access to information which would play a substantial part in the case as such would mean that the party would be unable to hear a substantial part of the case, would be unable to understand the reasons for the advice given to him and, in some cases, the reasons for the judgment. Thus what disclosure is necessary entails not only practical matters arising in the conduct of a case, but also the general position that a party should know the case he has to meet, should hear matters given in evidence and understand the reasons for the judgment."[45]I would have hesitated long before interfering with the discretion of this judge. However I believe he failed to give sufficient weight to the evidence of Mr Powell of his need to consult and the requirement of justice that Affymetrix be allowed to know about all the facts upon which the court will decide the case. As Buckley LJ said in Warner Lambert :
"If the matter be of a kind of which the party would be likely to be able for the aid of his advisers to form some kind of view of his own, it seems to me that he should normally be allowed to know as much about the facts as his adviser."
The exception referred to by Buckley LJ of a party who could not really form a view of his own would not apply in this case. This is not the exceptional case where there is a risk of a trade secret leaking out. Should use of the documents be limited to the amendment proceedings?[46]Again this issue no longer arises, but the order restricting use to the amendment proceedings, although perhaps desirable, appears to me to be unworkable. Although the dispute on amendment can in one sense be considered as separate from the main action, in truth it is not. The action is concerned with a validity of the patent, both as granted, and if amended, in its amended form. The question of amendment requires the court to consider whether the patent as granted was valid. If it was I do not envisage there would have been any abuse of monopoly and there would seem to be no reason for refusing amendment on discretionary grounds (see Bristol Myers Co v Manon Freres Limited [1973] RPC 836). Thus an order that requires that an attack upon the patent mounted in the amendment proceedings to be separate from and probably different to that taken in the main proceedings would place the judge in an impossible position. He might have to consider validity in the two proceedings upon different evidence. Further in this case there is a pleaded attack in the action that the patent is insufficient. If, as could be the case, there are certain documents which have been disclosed which throw light upon that issue, it would seem to me impracticable for the judge to consider the sufficiency in the main action upon different evidence to that in the amendment proceedings.[47]Since writing this judgment I have read the judgment of Brooke LJ. I agree with it.[48]For the reasons I have given I would dismiss this appeal. BROOKE LJ:[49]In Ventouris v Mountain [1991] 1 WLR 607 Bingham LJ said at p 611D:
"It is the protection of confidential communications between client and legal adviser which lies at the heart of confidential privilege, as is clear from the classical exposition of the law by Sir George Jessel MR in Anderson v Bank of British Columbia (1876) 2 Ch D 644 , 648-9. Without the consent of the client, and in the absence of iniquity or dispute between client and solicitor, no inquiry may be made into or disclosure made of any instructions which the client gave the solicitor or any advice the solicitor gave the client, whether in writing or orally."
In the field of patents, a similar privilege attaches to communications between a client and his or her patent agent.[50]In the practice of the English courts, it has occasionally happened that before obtaining relief from a court an applicant for relief has to ask the court to exercise its discretion in his or her favour. One example featured in the old practice of the divorce courts, to which I will refer later in this judgment. As the present appeal demonstrates, another can be found when patentees seek an order amending their patent. As Aldous LJ has made clear, the grant of a patent confers a twenty year monopoly, and if a patentee desires a court to alter, with retrospective effect, the basis on which the monopoly was granted, the law requires the patentee to disclose to it the relevant matters upon which it is to exercise its discretion.[51]In Hsiung's Patent [1992] RPC 497 complaint was made by the applicant for the revocation of the relevant patent that the patentee seeking amendment had not made adequate disclosure on two relevant matters (see Aldous J at p 511). The first related to the date when he first became aware of the necessity and desirability of amendment. The disclosure of this date would enable a conclusion to be drawn as to whether there had been culpable delay. The second was that he put forward no evidence all on the question whether he had sought to obtain an unfair advantage by maintaining his patent in its wide form.[52]One of the problems the patentee faced in that case was that his patent agent had disclosed the letter of instructions his firm had originally received from Singapore solicitors in April 1978, a follow-up letter from those solicitors in November 1978, and a reply by his firm dated 15th November 1979, which gave rise to questions which were never satisfactorily answered. In those circumstances Aldous J said at p 515:
"I have come to the conclusion that the patentee has not made full disclosure of all relevant matters. In particular, it appears from the passage in the letter of 15th November 1979 that the amendment was seen as one which might differentiate the prior art and, therefore, he must have been aware that some doubt existed. Because the rest of that letter was blanked out, it is not possible to know the advice that was given. It could have been that it was in the patentee's best interest to keep the claim wide at that stage of the patent's life. Further, there is no evidence as to what happened between 1980 and 1986. Mr Walton asked me to infer that nothing happened, but I can see no reason why I should do so. The patentee and his Singapore solicitors must have known what did happen and have refrained from giving any evidence from which any inference can be drawn. Advice may have been taken from Hong Kong solicitors. There may have been occasions when the patent was considered and even asserted against others. Further, there has been no disclosure of whether there have been corresponding patent applications in other countries and , if so, whether any patent office has raised an objection based on the prior art cited in this case. If so, those objections could have been met by amendments similar to those now proposed, showing that the patentee was put on notice of the need to amend. I am therefore left completely in the dark as to whether there has been culpable delay between 1980 and 1986. In the circumstances, I am unable to exercise my discretion to allow the amendments either in the form before the superintending examiner or in the form which accurately sets out the intention of the patentee."
[54]The difficulties the patentee encountered in that case certainly did not arise from the fact that he had disclosed all relevant matters other than those which attracted professional privilege. As Sir Donald Nicholls VC observed, when the case reached the Court of Appeal, his disclosure included parts of letters that were in fact the subject of privilege, and the parts blanked out were said by his patent agents to relate only to irrelevant matters (see p 523). While it is true that the applicant's agents had been urging that adverse inferences should be drawn from the patentee's failure to waive professional privilege, I can see nothing in Sir Donald Nicholls' judgment, with which Taylor and Farquharson LJJ agreed, to suggest that the Vice-Chancellor was under any illusion that a patentee could be compelled to waive professional privilege or that adverse inferences could be drawn from his failure to do so. The patentee's difficulties in that case stemmed from the fact that he had failed to disclose all relevant non-privileged matters in relation to the points in issue, and in so far as he elected to waive privilege in relation to some privileged correspondence, that correspondence raised more questions that it answered.[55]As a comparative newcomer to this specialist field of law I was very surprised by the second paragraph of the judgment of Laddie J in Kimberly-Clark Worldwide Inc v Proctor & Gamble Ltd [2000] RPC 422, in which he said at p 424:
"The position prior to the passing of the Patents Act 1977 was that any patentee wishing to amend his patent before the court had to make full and frank disclosure of all the documentation which threw light upon issues such as whether or not he had delayed in making the application, whether or not he knew of invalidating prior art and the like. The disclosure covered not just internal documentation of the patentee but also any relevant material passing between the patentee and his legal advisers. The obligation to make full and frank disclosure was so strong that effectively the patentee was put under pressure to waive his entitlement to legal professional privilege. If he failed to do so there was at least a risk that the court might decide that full disclosure had not been given and, on that ground, it would disallow amendment."
[56]There were two features of this description of the former practice which surprised me. The first was that the discovery obligation was said to include an obligation to disclose any relevant material passing between the patentee and his legal advisers. The second was that the court might be entitled to draw adverse inferences solely from a patentee's unwillingness to waive professional privilege.[57]As Aldous LJ has indicated, the House of Lords was concerned with suggestions of this kind in Wentworth v Lloyd (1864) 10 HLC 589. The Master of the Rolls in the lower court had drawn adverse inferences from the plaintiff's unwillingness to allow his solicitor to give evidence about his client's instructions to him. Although the decision of the Master of the Rolls was affirmed on the merits, Lord Chelmsford said at pp 590-1:
"The use of which the Master of the Rolls made of the exercise of the plaintiff's right to prevent the disclosure of confidential communications seems to me so entirely at variance with principle, and so utterly in contradiction to the well-known and invariably recognised privilege of professional confidence, that I cannot pass it by in silence ... ... The law has so great a regard to the preservation of [the professional relation between a client and his solicitor], that even the party himself cannot be compelled to disclose his own statements made to his solicitor with reference to professional business ... The exclusion of such evidence is for the general interest of the community, and therefore to say that when a party refuses to permit professional confidence to be broken, everything must be taken most strongly against him, what is it but to deny him the protection which, for public purposes, the law affords him, and utterly to take away a privilege which can thus only be asserted to his prejudice."
[58]In Kimberly-Clark Worldwide v Proctor & Gamble [2000] RPC 422 this court was concerned to overrule Laddie J's decision at first instance to the effect that there was no general discretion under Section 75 of the Patents Act 1977 to refuse an amendment to a patent on moral or quasi-moral grounds. It was not concerned with the issues of privilege that have arisen in the present case, and in those circumstances Aldous LJ was content to say at p 438 that even if Laddie J's summary in the opening passages of his judgment did reflect the practice prior to the passing of the 1977 Act, it would not apply today. I would go further now, and say that if this was indeed the old practice (as to which I am not qualified to express any view) it would have been wrong in law, in that it would have disregarded the well-known principles set out by Lord Chelmsford in Wentworth v Lloyd, which are still recited in the leading English text books on the law of evidence.[59]The principles that should now govern the performance of a patentee's duty of disclosure in amendment proceedings have been set out by Aldous LJ in his judgment in the present case. The modern regime for disclosure and inspection of documents can be found in Part 31 of the Civil Procedure Rules, and Aldous LJ explained in Kimberly-Clark at p 438 how judges equipped with the case-management powers afforded to them by the new rules are much better equipped to take a proactive role in requiring proper particularisation of documents and eliminating the sort of oppressive requests for disclosure which disfigured the conduct of so much civil litigation in the past.[60]As Aldous LJ has said in his judgment on the present appeal, there is no obligation on a patentee in amendment proceedings to waive privilege in respect of any document, and there is certainly nothing, and could be nothing, in the new CPR regime which alters the long-standing protection afforded by English law to documents which attract professional privilege.[61]A comparable procedure could be seen in divorce practice before the enactment of the Divorce Reform Act 1969. In those days the court was empowered to direct the dissolution of a contract of marriage if satisfied that one of the parties had broken the contract in one of the fundamental ways that were identified by Parliament from time to time. Because petitioners were bound to place all material facts before the court, they were obliged, in an appropriate case, to file with the court a confidential discretion statement in which they admitted their own acts of adultery. If they failed to do so, and the court was satisfied by other evidence that they had committed adultery, it might dismiss their petition under its discretionary powers (see, most recently, Section 5(4) of the Matrimonial Causes Act 1965).[62]It was thus a feature of this jurisdiction that petitioners were obliged to make full and frank disclosure to the court of their own shortcomings in relation to their observance of the marriage contract. As one who practised in this field of law before its reform in 1969, I never heard it suggested that a petitioner was obliged to place documents before the court which attracted legal professional privilege. Nor was it suggested that by placing incriminating evidence on a confidential basis before the court (which would otherwise attract privilege on the grounds that it contained an admission of adultery), the petitioner was waiving privilege as against the respondent. Needless to say, if a party's lawyers were satisfied that their client was engaged in putting information before the court which they knew to be untrue, or wilfully withholding material evidence which they knew to be true, they could not continue to act for that client.[63]In the very unusual circumstances of the present case, I agree with Aldous LJ that the respondents' solicitors did no more than explore whether it was possible to agree that their clients' confidential documents, which attracted professional privilege, should be disclosed to their opposite numbers on a strictly confidential basis. This did not constitute a general waiver of privilege, for the reasons given by Aldous LJ, with which I agree.[64]I also agree with the remainder of his judgment. I, too, would therefore dismiss this appeal. SEDLEY LJ:[65]I agree with both judgments.

ORDER

Appeal dismissed; declaration made in the terms of the draft order, namely a declaration that the claimant has not disclosed to the first and second defendants the documents listed in Schedule B of the list of documents dated 1 st June 2000 so as to waive any privilege therein; paragraphs 9 and 14 of the order of Pumfrey J of 7 th August 2000 set aside; no order as to costs, save that there will be no order on the appeal or the cross-appeal; leave to put in further submissions refused; permission to appeal to the House of Lords refused. (Order not part of approved judgment.)

Cited in 1 later judgment