AstraZeneca UK Limited v Tesaro, Inc.

AstraZeneca UK Limited v Tesaro, Inc.

The Licence Agreements, properly construed, require Tesaro to pay royalties on all net sales of Zejula in each country in which there are Licensed Patents from the first commercial sale in that country. The wording of the agreements, the structure of the definitions, and the absence of any mechanism to distinguish infringing from non-infringing use support this interpretation. The factual matrix, including the parties' awareness of the US doctrine of patent misuse, does not displace the clear language of the contract.

Parties
Claimant: AstraZeneca UK Limited; Defendant: Tesaro, Inc.
Jurisdiction
England and Wales
Judgment Date
05 April 2023
Procedural Posture
Commercial Contract Dispute (patent Licence Interpretation) / Judgment After Trial on Preliminary Issue of Contract Construction
Outcome
Claim allowed
Legal Topics
Interpretation of Patent Licence Agreements, Royalty Calculation Provisions, Doctrine of Patent Misuse (us Law), Factual Matrix in Contract Interpretation
Contract Law Intellectual Property Law Patent Law Interpretation of Patent Licence Agreements Royalty Calculation Provisions Doctrine of Patent Misuse (us Law) Factual Matrix in Contract Interpretation

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Parties

AstraZeneca UK Limited

Claimant

Tesaro, Inc.

Defendant

Procedural Posture

Commercial Contract Dispute (patent Licence Interpretation) / Judgment After Trial on Preliminary Issue of Contract Construction

Legal Issues

  1. 1 Proper construction of royalty provisions in the Licence Agreements between AZ and Tesaro
  2. 2 Whether royalties are payable on total sales or only on sales that would otherwise infringe the Licensed Patents ('pay to infringe')
  3. 3 Relevance of US doctrine of patent misuse to contract interpretation

Ratio Decidendi

The Licence Agreements, properly construed, require Tesaro to pay royalties on all net sales of Zejula in each country in which there are Licensed Patents from the first commercial sale in that country. The wording of the agreements, the structure of the definitions, and the absence of any mechanism to distinguish infringing from non-infringing use support this interpretation. The factual matrix, including the parties' awareness of the US doctrine of patent misuse, does not displace the clear language of the contract.

Court Disposition

Claim allowed

Orders

  • Tesaro is obliged to pay AZ royalties on all net sales of Zejula in each country in which there are Licensed Patents from the first commercial sale in that country.