Letter from Amerikat: Happy Bunny Day!

The AmeriKat has been enjoying the warmth of the sunbeams that have danced across her numerous files, spreadsheets and bundles this past week. The warmer weather brings out the summer clothes and English smiles, but also insects. Almost this time last year the AmeriKat was in the throws of a biblical scale warfare with swarms, floods, and drought inflicting her house. She had hoped that the spring and summer of 2010 was a blip in the calendar of insect infestations she would have to deal with, but alas, with the warmer weather the ants are back. She has now found the gap in her floorboards were the pesky insects have been arriving from, but like plugging a hole in a leaky boat, the water will always find somewhere else to spill in from. So instead of lounging out in the sun, dying eggs, eating chocolate and drinking lemonade on Easter Sunday, she is instead attacking any small six-legged body racing across her floor. (picture, left- the AmeriKat inspecting an alleged Easter bunny) Happy Easter from the AmeriKat!

Bratz Beats Barbie with $89 million jury-award

From pesky six-legged insects, to perky two-legged dolls. Last week a Californian federal jury issued their verdict in favor of Bratz (picture, right) in the now-famous copyright and trade secret battle between Barbie and Bratz (see previous reports here). Barbie's maker, Mattel, had alleged that the maker of the Bratz doll - MGA Entertainment- stole the idea for the Bratz doll by entering into a deal with the designer of the doll, Carter Bryant, who had previously worked for Mattel. Mattel subsequently filed a lawsuit for copyright infringement and trade secret violations, while MGA alleged unfair competition and also trade secret theft. This case was heard by first by Judge Larson who ruled in favor of Mattel, but that $100 million verdict was overturned on appeal. The Court of Appeals for the Ninth Circuit held that the federal court judge had erred in ruling that Mattel automatically owned the designer's sketch of the doll under the terms of the 'Employee Confidential and Inventions Agreement' between Mattel and the designer and remanded the case back to the federal court.

Bryant's employment agreement had assigned all rights, titles and interests in any such inventions, patents and copyrights to Mattel. The contract defined "inventions" as including, but not limited to, discoveries, improvements, processes, designs and know-how. The district court had held that this agreement assigned Bryant's ideas to Mattel despite 'ideas" not being included on the list or mentioned anywhere else. Mattel argued that the list of examples in the contract were illustrative not exclusive, but the Court held that "ideas" are "markedly different from the list of examples including discoveries, improvements and designs" (People ex rel Lungren v superior Court (1996)). (picture, left - no amount of law school could prepare Lawyer Barbie for the cruelty of a jury verdict) The Court of Appeals stated that the contract was arguable capable of either including or not including ideas, but that the trial court did not recognize this ambiguity and thus did not examine the extrinsic evidence before it on this issue.The Appeals Court concluded that the agreement could be interpreted to cover ideas, but that the text of the agreement did not compel that reading and thus remanded the issue back to the district court. They stated that:

"Designs, processes, computer programs and formulae are concrete, unlike ideas which are ephemeral and often reflect bursts of inspiration that exist only in the mind."

At the end of last year, Mattel and MGA applied for summary judgment on the issue of copyright infringement for the first and second generation Bratz dolls. Judge Carter granted summary judgment in MGA's favor in respect of the second generation Bratz dolls, but the remaining issues, including breach of copyright for the first generation of Bratz dolls and the breach of confidence/trade secret claims, remained for trial. The court was tasked with determining whether the Inventions Agreement entitled Mattel to Bryant's ideas for names like "Bratz" together with sketches that he created outside working hours. Also, ripe for ruling was MGA's trade secret claim against Mattel through a campaign of corporate espionage, whereby MGA alleged that Mattel's employees gained access to regulated private MGA toy showrooms by deceptive means.

On Thursday, a federal court jury in Santa Anna, California, found in favor of MGA and following the Court of Appeals opinion held that Mattel did not own the sketches or ideas for the Bratz dolls. The jury verdict also held in favor of MGA's counterclaim that Mattel had willfully misappropriated trade secrets and slammed Mattel with a $88.5 million damages price tag. A slight saving grace, albeit an insulting one, was that the federal jury also found that MGA had interfered with Bryant's contract with Mattel and issued Mattel a $10,000 award for the interference.

Although the battle may not be over with reports that Mattel will file a motion for a retrial within two weeks and will reserve the right to appeal, the case does remind everyone of the importance of carefully drafted employee contracts, as well as taking the business decision to litigate over seven or so years even if it costs your shareholders $400 million (see MSN money report here). However, if Mattel's intention was to quash the rival dollmaker, the litigation may have just done that. MGA's CEO, Isaac Larian is reported as saying that the Bratz brand "will never be the same level it was before."

tytoc collie will keep you posted on any further developments in the case.

Tony Duquette seeing Spots with J.Crew sweater

Tony Duquette, Inc, the proprietor of the various IP rights associated from the late namesake artist and designer filed a trade mark infringement suit against clothing retailer and AmeriKat favorite, J.Crew in a New York federal court last week. For those not in the know, the late Tony Duquette was a Tony award-winning designer and artist who counted Elizabeth Arden and the Duke and Duchess of Windsor as clients. Tony Duquette allege that J.Crew has infringed the DUQUETTE name and trade mark by producing and selling a sweater with the style name the "J.Crew Duquette Factory Leopard Print". The complaint alleges that J.Crew knowingly and willfully used the DUQUETTE trade mark in connection with their leopard print sweater because of Duquette's alleged unique association with leopard prints, in particular with woven and printed textiles including carpets and tapestries. (picture, left - a fabric design by Duquette) The AmeriKat is seeing more and more product descriptions that use trade marked words become the subject of trade mark disputes. In the UK, one can always invoke the fun game of whether the product description is being used as a function (of many, many functions) of a trade mark. In the U.S., the case is arguably little more straightforward.

Albeit having not read the complaint, the AmeriKat's gut instinct is that there is not enough here to satisfy the test of trade mark infringement. i.e., namely where is the confusion and whether Duquette has enough reputation in his name associated with leopard print textiles to claim dilution? Further live trade mark registration for DUQUETTE the AmeriKat found on USPTO is for tapestries of textiles, carpets and rugs - not apparel (Reg No. 3863326). The AmeriKat perused J.Crew's website today and found one leopard print sweater which is called the "Wild spots cardigan" - a very un-J.Crew product name - so her guess is that J.Crew has already taken steps to change the name of the contentious product. The Amerikat predicts this lawsuit to die a quickish death, just like the animal print trend of last season.

Apple v Samsung v Apple v Samsung v Apple....

Last year the AmeriKat was constantly up-to-date reporting on the latest of the patent mobile phone wars. She has now officially lost track, except for the latest of the battles now between Samsung and Apple. Apple sued Samsung two weeks ago in California federal court for trade dress, design patent, trade mark and patent infringement against Samsung's Galaxy line of smartphones and tablets. Apple allege that Samsung's products are copies of the iPhone and iPad designs including the "icons with the rounded corners."

The incestuous ties of the smartphone and tablet manufacturers and retailers are felt in this case. In 2010 Samsung earned a reported $5.7 billion revenue from Apple by way of their purchase of Samsung semidconductors. Tim Cook, Apple's CEO, told the Wall Street Journal that Apple is

"Samsung's largest customer, and Samsung is a very valued component supplier to us, and I expect the strong relationship will continue. Separately from this, we felt the mobile communication division of Samsung had crossed the line, and after trying for some time to work the issue, we decided we needed to rely on the courts."

The litigator in the AmeriKat sensed a nice little bargaining chip for Apple in this suit, however not to be uncharacteristic in this type of litigation Samsung then "countersued" Apple last week, but not in the U.S. Samsung filed patent infringement lawsuits against Apple in Korea, Japan and Germany alleging violations of patents filed in each of those jurisdictions. The allegedly infringed patents involve "transmission optimization and reduction of power usage during data transmission, 3G technology for reducing data-transmission errors and a method of tethering a mobile phone to a PC to enable the PC to utilize the phone's wireless data connection." The speed in which these lawsuits were filed indicate that Samsung may have been preparing itself for this counter-attack for sometime.

This latest chapter in the mobile patent war saga again demonstrates that when it comes to litigation surrounding smartphone technology, the best defence that is repeatedly being employed by parties is that of pursuing offensive litigation strategies on a global level. Whether or not that will prompt the parties to settle sooner is not a certainty, but the more complicated and more jurisdictions in which a company has to battle, the more attractive it becomes to resolve the dispute before litigation costs rocket and stated commercial relationships are massively affected.

"Making"? It's Open and Schütz...

There are days when it rains and, for a Kat at least, others when it paws… Today is definitely one of the latter. In an avalanche of activity, the Court of Appeal has handed down a trio of IP judgments this morning. First on this Kat’s platter for the day is the decision in Schütz v Werit [2011] EWCA Civ 303.

Schütz is the exclusive licensee of a European Patent (EP (UK) 0 734 947) belonging to Protechna. The patent is for an intermediate bulk container (IBC). As Jacob LJ explains: “An IBC is a large (about 1000 litres, so about a metric tonne or more) container used for the transport of liquids. They have to be able to withstand the tough conditions of transport – they must be leak proof, capable of being stacked in threes or fours (so the bottom one may have about 6 tonnes on it), capable of withstanding prolonged or violent vibration and withstanding the forces caused by the liquid within sloshing around.”

Prior to the patent, IBCs of a two-part construction (basically a plastic bottle within a metal cage) were well-known. Due to the generally tough conditions of transport and the inherent differences in durability between plastics and metals, the average lifespan of the cage is some five times that of the bottle that it holds. Consequently, an industry has developed to repair any damage to the cases and to refresh the containers themselves by “re-bottling” (i.e. replacing the old bottle with a new one from the same manufacturer) or “cross-bottling” (i.e. replacing the old bottle with one from a different source). Schütz objects to its cages being used by cross-bottlers, which, as you might expect, is the root of this dispute.

As the Court explains:

[10] “Werit sells bottles for IBCs to a company called Delta, a reconditioner. Delta buys discarded Schütz IBCs, removes and discards the original Schütz bottles, makes any necessary repairs to the cage, replaces them with Werit bottles and offers the resulting IBC to the market in competition with Schütz.”

Schütz originally brought an action for infringement against Werit, as is their right pursuant to s67 of the Patents Act 1977, it being common ground that if Delta infringed the Patent by their reconditioning then so also did Werit. Werit did as any alleged infringer would do and counterclaimed for invalidity. Protechna were formally parties to the proceedings, but took no active part therein – and so for the purposes of this note can conveniently be forgotten. At First instance ([2010] EWHC 660 (Pat)), Floyd J found the patent valid but not infringed. Both Schütz and Werit appealed against the findings that they did not agree with, and the case arrived before the Court of Appeal.

Before the Court, three issues remained live: (a) whether the patent was invalid for insufficiency or was so ambiguous that it could not be infringed; (b) whether the Patent was invalid for added subject matter; and (c) whether, if valid, what Delta does amounted to an infringement within the meaning of s60(1) PA 1977 – in other words, was Delta “making” the patented article?

The first two points are described by Jacob LJ as having “no general importance”, the real focus of the appeal being issue (c). To cut a long story short, the patent was found to be valid and so the Court turned to the main point of contention: “making”.

Making
The patent claimed an IBC consisting of three items: a pallet, a bottle, and a cage. The cage was considered to be the novel and inventive bit – to which the bottle and pallet add nothing of interest, save that the bottle is “exchangeable” and co-operates with the frame. This interaction between frame and bottle provided the IBC with its strength and stability. The question before the Court was therefore whether when Delta puts a Werit bottle into a Schütz cage it infringes the Patent.

(As a brief aside: the background to the drafting of the PA 1977 is well known, as is Jacob LJ’s wonderment at the lengths that were taken to turn the perfectly serviceable wording of the various International Conventions upon which certain provisions of the Act were based into anglicised shadows of their former selves. Fans of such comments will accordingly not be displeased with [36] to [39] of this judgment.)

However, back to making: the starting point for the discussion of “making” was considered to be Art 25 CPC, which, in turn, brought in Article 69 EPC, as the “extent of protection is determined by the claims.” The only question before the Court was therefore whether the act of putting a bottle into a Schütz cage constituted “making a product which is the subject-matter of a patent”.

With this point sorted, Jacob LJ then dived headlong into an analysis of United Wire v Screen Repair Services [2001] RPC 24, noting that this had been the main battleground of the parties in this case. The crux of the dispute was whether United Wire established (or indeed prohibited) a “whole inventive concept” test for the determination of whether there had been “making”. If such a test had been adopted, then it was argued that, as the cage embodied the whole of the inventive concept of the claimed invention, anyone putting a new bottle into an existing cage could not be said to be “making” the patented article.

In particular, the parties disputed the meaning to be attributed to the following excerpt from Aldous LJ’s judgment in United Wire in the Court of Appeal:

[25] “It is therefore better to consider whether the acts of a defendant amount to manufacture of the product rather than whether they can be called repair, particularly as what could be said to be repair can depend upon the perception of the person answering the question. Even so, when deciding whether there has been manufacture of the product of the invention, it will be necessary to take into account the nature of the invention as claimed and what was done by the defendant.”

Schütz argued that Aldous LJ was saying that what mattered was whether the defendant was making the patented article. Werit, on the other hand, considered that the final sentence was by implication bringing in the Judge’s “whole of the inventive concept” test. The distinction mattered as the House of Lords had explicitly endorsed Aldous LJ’s judgment in the case as correct.

Jacob LJ considered that Aldous LJ could not have been adopting a “whole inventive concept” test. To have done so would have rendered it impossible to subsequently hold (at [29] of United Wire) that it was an infringement for Screen Repair Services to recondition or repair a frame made by United Wire and re-use it to make an assembly as claimed in claim 1 of that patent. This was because (as explained at [54] of the Schütz decision) in the case of one of the patents alleged to be infringed in United Wire the inventive concept resided solely in the use of a flexible frame. Adopting a “whole inventive concept” test would have meant that when Screen Repair Services sandblasted and re-meshed this frame they would not have infringed, having not made the invention afresh.

Turning, then, to the House of Lords’ decision, Jacob LJ noted that Lord Hoffmann explicitly endorsed the Court of Appeal’s approach in the case. Moreover, his Lordship had explained that “whilst “repair” might as a matter of acontextual language overlap with “making” it could not do so for the purposes of s.60(1)(a) (i.e. Art. 25).” The important thing was to identify the patented product. In the instant case the product was the IBC. This ceased to exist when the bottle was removed. What remained at this stage was, according to Jacob LJ, “merely an important component from which a new IBC could be made.”

Accordingly, Jacob LJ considered that the House of Lords in United Wire had excluded the “whole inventive concept” test. The only question of importance was whether the alleged infringer had made the patented product. Here Delta had done just that when they replaced Schütz’s bottles with those manufactured by Werit.

The Court of Appeal also considered that there were additional reasons for rejecting the “whole inventive concept” test, notably that in practice it is likely to be fuzzy and uncertain:

[72] “…How precisely do you ascertain it? Take this very case. The cage co-operates with the bottle in the complete IBC. It is the combination of both which is claimed. So what is the whole inventive concept? Just the cage? Or the combination?
…
[76] “Another way in which the test is uncertain is that it would depend on what piece of prior art you took into account. For in a general sort of way the “inventive concept” is the difference between the patented idea and the old idea. That depends on what the old idea was.”

Furthermore, Canon v Green Cartridge [1997] AC 728 was considered to address one of the Judge at first instance’s concerns in the present case – the fact that if there was infringement Schütz would, as a commercial matter, have a monopoly in unpatented replacement bottles for their cages. Jacob LJ considered (at [79]) that this was “not really an apt matter for patent law”:

[80] “Does it really matter if Schütz has a monopoly in replacing bottles for its cages? One cannot really say whether there is any public interest in the nature of freedom of competition seriously involved. If anything it would seem not. Schütz’s actual customers would appear to be largely indifferent concerning the activities complained of. They simply want the used IBCs off their premises. They are not people who want their IBCs “repaired.””

The Judge at first instance had also considered (at [196] of that decision) a hypothetical patent on an inventive tennis racquet frame, with claims calling for a strung racquet coupled to the inventive frame. He asked: “Does this prevent re-stringing, even though the invention is said to lie in the features of the frame alone?”. Again, Jacob LJ considered that this was not an important consideration:

[90] "It is not necessary for us to provide any general answer to the “restringing problem”. It suffices to say that Delta, when it fits Werit bottles into Schütz cages, is making IBCs which fall within the Patent and are doing so without the licence of Schütz. That they themselves on their own website say they are “re-manufacturing” says it all."

Open and Schütz…

Jurisdiction to deal with foreign patents: Solvay goes all the way

Sticky issues go to the ECJ

Here comes another set of riddles for the Court of Justice of the European Union to resolve: it comes in the form of Case C-616/10 Solvay S.A v Honeywell Fluorine Products Europe B.V., Honeywell Belgium N.V. and Honeywell Europe N.V.  This was a reference for a preliminary ruling from the Rechtbank's-Gravenhage, The Netherlands, regarding the application of Articles 2, 5(3), 6(1) and Article 22(4) of Council Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (the Brussels Regulation). Background to this reference can be found on PatLit, here.

The questions are as follows:

Regarding Article 6(1) of the Regulation:

In a situation where two or more companies from different Member States, in proceedings pending before a court of one of those Member States, are each separately accused of committing an infringement of the same national part of a European patent which is in force in yet another Member State by virtue of their performance of reserved actions with regard to the same product, does the possibility arise of ‘irreconcilable judgments’ resulting from separate proceedings as referred to in Article 6(1) of the Regulation?

Regarding Article 22(4) of the Regulation:

1. Is Article 22(4) of the Regulation applicable in proceedings seeking provisional relief on the basis of a foreign patent (such as a provisional cross-border prohibition against infringement), if the defendant argues by way of defence that the patent invoked is invalid, taking into account that the court in that case does not make a final decision on the validity of the patent invoked but makes an assessment as to how the court having jurisdiction under Article 22(4) of the Regulation would rule in that regard, and that the application for interim relief in the form of a prohibition against infringement shall be refused if, in the opinion of the court, a reasonable, non-negligible possibility exists that the patent invoked would be declared invalid by the competent court?

2. In order for Article 22(4) of the Regulation to be applicable in proceedings such as those referred to in the preceding question, must the defence of invalidity be subject to procedural requirements in the sense that Article 22(4) of the Regulation is only applicable if invalidity proceedings before the court having jurisdiction under Article 22(4) of the Regulation are already pending or are to be commenced - within a period to be laid down by the court - or at least that a summons in that regard has been or is being issued to the patent holder, or does it suffice if a defence of invalidity is merely raised and, if so, are requirements then laid down in respect of the content of the defence put forward, in the sense that it must be sufficiently substantiated and/or that the conduct of the defence must not be deemed to be an abuse of procedural law?

3. If question 1 is answered in the affirmative, does the court, after a defence of invalidity has been raised in proceedings such as those referred to in question 1, retain jurisdiction in respect of the infringement action with the result that (if the claimant so desires) the infringement proceedings must be stayed until the court having jurisdiction under Article 22(4) of the Regulation has given a decision on the validity of the national part of the patent invoked, or that the claim must be refused because a defence that is essential to the decision may not be adjudicated, or does the court also lose its jurisdiction in respect of the infringement claim once a defence of invalidity has been raised?

4. If question 1 is answered in the affirmative, can Article 31 of the Regulation confer on the national court jurisdiction to adjudicate on a claim seeking provisional relief on the basis of a foreign patent (such as a cross-border prohibition against infringement), and against which it is argued by way of defence that the patent invoked is invalid, or (should it be decided that the applicability of Article 22(4) of the Regulation does not affect the jurisdiction of the Rechtbank to adjudicate on the infringement question) jurisdiction to adjudicate on a defence claiming that the foreign patent invoked is invalid?

5. If question 4 is answered in the affirmative, what facts or circumstances are then required in order to be able to accept that there is a real connecting link, as referred to in paragraph 40 of the Van Uden v Deco-Line judgment [Case C-391/95], between the subject-matter of the measures sought and the territorial jurisdiction of the Contracting State of the court before which those measures are sought?

This particular member of tytoc collie team freely admits that, if Kats have Achilles' heels, the Brussels Regulation is definitely one of his, so he is keeping quiet about this one till he is faced with a neatly packaged, carefully reasoned judgment to criticise.  However, if any reader would like to comment on this case to the UK's Intellectual Property Office you can email the IPO at policy@ipo.gsi.gov.uk before 28 February 2011.

BREAKING NEWS: judge ejects Virgin chair patent suit

Are you sitting comfortably? Have you fastened your safety belts?  Yes? Then here we go! This morning in Virgin Atlantic Airways Ltd v Delta Airways Inc [2010] EWHC 3094 (Pat) Mr Justice Arnold, sitting in the Patents Court for England and Wales, did something that not many judges do -- he gave summary judgment in favour of a defendant in a patent infringement action.  The defendant was Virgin's airline rival Delta and the subject of the dispute was the famous Contour chair which this Kat, for one, has never curled up on and is, unless he finds a way to grow money, unlikely to do so.

The judgment has only just come out and this Kat implores his fellow-Kats who are more patent-oriented to get their claws into it for some real legal analysis.

Earlier posts on the Contour action here and here
Bloomberg here

Note: since posting the above note, tytoc collie has received the following piece from law firm Taylor Wessing. He thought it was a very useful summary:

"This is the latest of a series of legal skirmishes, both in the UK and at the EPO, involving Virgin's Patent for flat-bed seats. The Judge dismissed the action against Delta Airways for infringement of Virgin's flat-bed patent by way of joint tortfeasance with Delta's seat manufacturer, Premium Aircraft Interiors (Contour). He did so on the grounds that there was no primary act of infringement by Contour and so by definition Delta could not be a joint tortfeasor. This is not likely to be the end of the story - it is expected that Virgin will seek permission to appeal the decision. 

In granting summary judgment, by striking out Virgin's claim as having no real prospect of success, the Judge has done something fairly extraordinary in a patent case. Patent cases are hardly ever appropriate for summary judgment, primarily because patent cases are so dependent on expert evidence. However, in this case, because of the prior history of the long-running dispute between Virgin and Contour (the seat manufacturer that helped design and manufacture Virgin's Upper Class Suite (UCS) business class seats), that culminated in the European Patent Office hearing in September this year, the judge felt able to make his decision without requiring further expert evidence. 

However, also, and perhaps even more significantly, the judge seriously called into question (and with substantial reasoning) the doctrine of infringement of a patent by supplying a "kit of parts" as a separate head of infringement under section 60(1)(a) of the Patents Act 1977. That doctrine, under the current law, had arisen in two previous English cases, Rotocrop International Ltd v Genbourne Ltd [1982] FSR 241 and Lacroix Duarib SA v Kwikform (UK) Ltd [1998] FSR 493. In his analysis (probably the most detailed analysis of the point anywhere since the Community Patent Convention (CPC) of 1975 had the effect of harmonising the national patent laws of a number of European states), he also considered the law on this point as it applied in other CPC states and concluded that the supply by a UK defendant of an incomplete "kit of parts" to a customer outside the UK could not infringe a UK patent but also that the supply of a complete "kit of parts" to such a customer should also not infringe either under section 60(1)(a) or section 60(2) of the Patents Act 1977".

The pressure's off: KCI v Smith & Nephew in the Court of Appeal

Following a remarkably swift turn-around, the Court of Appeal last Thursday handed down its judgment in KCI Licensing Inc and others v Smith and Nephew plc and others [2010] EWCA Civ 1260.

Two patents were in issue: European Patent No. 0 777 504 (‘504) concerning “wound drainage equipment” and No. 0 853 950 (‘950), a divisional of ‘504, concerning “wound drainage canisters” designed to fit in said equipment. Both relate to apparatus for the treatment of wounds by negative pressure wound therapy. The apparatus claimed in the patents essentially consists of a pump in connection with a disposable canister and tubing system that operates to collect exudate and prevent contamination of the pump unit (KCI's InfoVAC system - above right). Both patents claimed the use of reticulated foam as a dressing, and ‘904 additionally claimed the use of a gelling agent in the canister so as to prevent spills. KCI had brought an action against Smith & Nephew (S&N) alleging infringement of both patents; S&N counterclaimed for revocation.

The judgment of the Court of Appeal comes less than 5 months after Mr Justice Arnold ([2010] EWHC 1487 (Pat) – noted by tytoc collie here) found: that the patents were entitled to their priority date (22nd August 1994); that S&N’s attacks on the validity of the relevant claims failed; that S&N’s GO and EZ pumps and canisters fell within the scope of the relevant parts of the patents’ claims; and that there was infringement pursuant to s60(2) PA 1977.

S&N's RENAYSIS GO system (left)

Before the Court of Appeal, the issues had been reduced to questions of whether the GO system infringed claim 5 of the ‘504 patent; whether sales of the GO canisters had been intended to put the inventions of claims 7 and 8 of ‘950 into effect within the meaning of s60(2); and whether the patent was invalid for obviousness.

Infringement of the ‘504 patent
Turning first to construction: the Court focused on the elements of claim 1 of the ‘504 patent (upon which claim 5 was dependent). A key element of this required interpretation of “means for detecting when the canister is substantially filled with liquid and generating a signal which causes the pump to be deactivated”. According to the Court, this required ‘means’ for three things: (1) detecting… (2) generating a signal, and (3) which causes the pump to be deactivated.

S&N’s GO device did not contain a separate detector and deactivation element, however, in the words of the judge below (see [186] and [187] of the first instance judgment): “When the canister is full, the system detects that the vacuum level in the headspace is increasing and slows the pump motor down to below a predetermined (but unspecified) threshold level. After this, the pump just ticks over and no more liquid is pumped into the canister.” The Judge had concluded that this fell within the meaning of the term “deactivated” in the claim as it was considered unnecessary for the pump to be switched off so long as it was “rendered sufficiently less active that no more fluid is pumped into the canister.”

The Court of Appeal disagreed. It noted (at [33]) that the specific embodiment of the patent showed “an actual detector. It detects when the fluid has reached a certain level and sends a signal which switches the pump motor off. Nothing like that happens with the GO device. The way GO works is quite different.” Accordingly, the GO device was found not to possess a “relevant “full” detector at all, that is to say no detector which responds to a full condition so as to deactivate the pump”. The Court’s construction of the term deactivated was said to be further reinforced when considering the manner in which the term was used in the wider specification. It noted (at [36]) that:

“The judge considered that the purpose of the element was to “stop the canister being over-filled with fluid” at [186]. And so it is. So the element should, using purposive construction, be construed as limited to a means which does just that. There is nothing in the GO device which stops over-filling. The canister fills to the brim. It fills no more because there is no room, not because the pump is deactivated.”

The GO device was therefore considered not to be within this element of the claim.

The claim also required “said canister and said housing having a guide for aligning the container in a recess in the housing such that the suction port is connected to the pump.” The judge had held that the claim did not require the canister to be situated wholly or partially within a recess in the housing, but could be satisfied if the housing had something which could be called “a recess” and the canister fitted over that. What really mattered was a guide for aligning the canister so that the suction port is connected to the pump, that being the real purpose of the integer.

Again the Court of Appeal disagreed. It noted (at [41]) that:

“The claim requires a “recess in the housing” and that the “container” be aligned “in” (our underlining) that recess. The language of the claim simply does not extend to a case where the container is fitted over the housing…. Although [in the case of the GO apparatus] the purpose of the claim (connection) is achieved, it is achieved in a different way from that called for by the claim.”

Accordingly, S&N’s GO system was held not to infringe claim 5 of the ‘504 patent.

Infringement of the ‘950 patent pursuant to s60(2)
Moving on to the s60(2) points, the Court reiterated its recent clarification of the requirements made under that section in Grimme v Scott [2010] EWCA Civ 1110 (noted by tytoc collie here). Following this guidance, it was clear that the judge had misdirected himself when concluding that the ultimate users must have decided to use the means to put the invention into effect at the time they first take possession of the means. The Court explained that “The relevant intention may be formed at a later time. But the supplier must know (or it must be obvious to him in all the circumstances) that some ultimate users will indeed form that intention.”

Accordingly, S&N were found to have infringed because it was “probable that from time to time some medical personnel using the GO system have clamped the end of the inlet tube when changing the canister. Further, it would have been obvious to a reasonable person supplying GO canisters that that this would be likely to occur.”

Obviousness
Completing its tour of the issues, the Court finally turned its attention to the question of obviousness. Here it considered that the judge had proper material upon which to base his finding of non-obviousness in relation to the use of reticulated foam. The “very open-celled structure” of the foam would have made concerns over keeping the wound moist and avoiding tissue ingress particularly acute, such that the skilled team (including a clinician and a design engineer) would have rejected its use. In contrast, the judge’s (“somewhat reluctant…”) conclusion that the addition of a gel-forming substance to the drainage canister before use was not an obvious step to take was overturned. The judge had fallen into error on this issue.

Other uses for negative pressure here

The chips are down in spud-separator shoot-off

Hot(ish) off the press, tytoc collie brings you news of the Court of Appeal’s (Jacob and Etherton LJJ and Sir David Keene on the Bench) judgment in Grimme Landmaschinenfabrik GmbH & Co KG v Derek Scott (trading as Scotts Potato Machinery) [2010] EWCA Civ 1110, handed down on Friday by Lord Justice Jacob. By way of background: Grimme had originally alleged that Scott was infringing its European Patent (EP(UK) 730 399) and unregistered design rights in a potato separator by sale of a machine called “Evolution”. [For those not versed in the day-to-day mechanics of the potato farming industry: the potato separator is an ingenious machine that (somewhat conveniently, given its name) separates potatoes from the assorted detritus that one would expect things wrenched from the ground to be duly associated with – i.e. weeds, earth, stones, stalks, etc.]. Scott, for his part, resisted those claims, and in turn sought revocation of the patent and relief for unjustified threats alleged to have been made by Grimme in respect of both patent and design right infringement.

At first instance [noted by tytoc collie here], Mr Justice Floyd, had held that, while claim 1 of the patent was invalid as it lacked inventive step, claims 17 and 24 were valid. He found that Evolution infringed claim 17 “provided that at some point in the separating path it has two counter-rotating pairs of rubber rollers”. If, however, Evolution did not have two counter-rotating sets of rubber rollers at some point in the separating path, then because it was adaptable to include two such sets, its sale would infringe claim 17 under section 60(2) – Scott knowing, or it being obvious to a reasonable person in the circumstances, that users might swap the steel rollers for rubber ones. Furthermore, in cases where rubber rollers were already fitted to Evolution when sold, the sale of spiral replacement rollers was additionally, and of itself, an indirect infringement under s60(2) Patents Act 1977 (Scott once more being found to possess the requisite knowledge). Grimme’s design rights survived the allegation that they were commonplace, and were found to be infringed by Scott’s original roller (although not a subsequent incarnation). The fate of the counterclaims for unjustified threats was, as may be expected, tied to the outcome of the allegations of infringement and so succeeded in relation to the design right but not in relation to the patent infringement proceedings – in respect of the latter, although threats were made, they were justified.

THE APPEAL

The arguments raised upon appeal were confined to “issues about the Patent and the unjustified threats claim and include a point of general application about the meaning of s.60(2) of the Patents Act 1977.” All in all, 12 issues had been agreed at the outset of the hearing, but the Court was of the opinion that it would be advantageous to “consider first whether the Judge’s construction of claim 1 was correct or whether it was, as Grimme contended, narrower. If we concluded it was narrower, then we should consider the question of its obviousness. The advantage of this course was that if we concluded that claim 1 was valid, then the separate points sought to be raised by Mr Scott about claims 17 and 24 would fall away.”

(1) Construction & Validity

Approaching, therefore, the issue of construction, the Court considered that the Judge had construed claim 1 of Grimme’s patent too widely. In particular, Grimme had argued that the Judge had not addressed the “requirement that that the rib part (we use that as shorthand for lip, rib or like extension) should project beyond the contours of the cylindrical shell part”. It had been submitted that this meant that the rib had to project from the cylindrical surface of the roller as in fig.12 of the patent (reproduced below right) where the rib extends out of the cylinder. The Court considered that there may have been a number of reasons for this omission, but agreed with Grimme’s contention that the experts on both sides thought that the star wheels of Rollastar were not themselves within the language of the claim. Thus, whilst “the court is not bound by the views of the experts as to the meaning of ordinary words in the claim …, it is obviously a strong thing for the court to take a different view from a consensual view of the experts.” Furthermore, it was “consistent with the inventor’s purpose to read the claim in the narrower sense: “That purpose is to remove mud, stones and haulm by dragging them through the gaps between the ribbed rollers and the clod roller.

If you use star wheels of the sort in Rollastar you are not aiming to do that. You are aiming to remove stones and mud by a sieving action.” (see [35] to [43]).The Court therefore considered that the claim required that the “lip, rib or like extension” must rise out of the cylindrical portion – and thereby that it must have axial length and there must be a recognisable cylindrical portion from which it projects. This was a narrower construction than that adopted by the Judge and, accordingly, obviousness had to be looked at afresh – the Judge having concluded on a (now incorrect) wider reading of the claim that it was obvious. “The Biogen principle of deference by an appeal court … to the multifactorial assessment of a trial judge” not applying in such circumstances.

Therefore, applying the Pozzoli v BDMO ([2007] EWCA Civ 588, [2007] FSR 27), restructuring of the classic Windsurfing test, the Court concluded that to move from the prior art (Rollerstar) machines to Grimme’s patented invention would not have been obvious. There were a number of steps along the way that provided impediment to the allegedly obvious path that were such that “the skilled man simply would have no motive or reason for even embarking [it].”

In the Court’s words: “The upshot is that the Patent is wholly valid and Mr Scott’s machine sold with elastomeric clod rollers falls within claim 1. Its sale and offering for sale is a direct infringement prohibited by s.60(1) of the Act.”

(2) Contributory/Indirect Infringement under s60(2)

The Court considered that Scott’s sale of the Evolution machine with steel rollers fitted fell outside of claim 1. However, the fact that “the machines [were] designed so that the rollers were interchangeable …, and that those supplied with steel clod rollers could be changed by the ultimate user (or indeed a middleman) over to rubber rollers …, [when combined with the fact that] they were marketed on that basis”, easily supported a claim for contributory infringement under s60(2).

In relation to this latter point, the Court gave full treatment to the origins and scope of the section [by far the fullest treatment of the provision that this Kat has ever seen in an English decision]. It therefore noted that the section originates from Art. 30 of the 1975 draft of the Community Patent Convention, and which became, in unchanged form, Art. 26 of the 1989 version, neither of which ever entered into force, but is still one of those provisions of which the Patents Act 1977 is “so framed as to have, as nearly as practicable, the same effects in the UK as the corresponding provisions of the Community Patent Convention”. As with nearly all such provisions, the text of the CPC was taken and remixed when bringing it within the domestic legislation (a practice described as “preposterous” by the Court, which also notes that this practice “serves [only] to confuse”). Nevertheless:

[88] “Section 60(2) creates a statutory tort, but it does not spring from any previous notional or common law tort. Its distinctive features, by way of contrast with common law tortious claims, are that the tort is actionable (1) even though what is supplied is capable of perfectly lawful, non-infringing use, (2) even though what is supplied never has been and may never in fact be used in a way directly infringing the patent in suit, (3) without any damage being suffered by the patentee, and (4) at the moment of supply, irrespective of anything that may or may not occur afterwards.

…[90] [This] makes the description “contributory” as opposed to “indirect” infringement something of a misnomer. If and to the extent that Mr Scott’s case is that there can be no infringement under s.60(2) unless there is actual direct infringement, it is plainly wrong. In this connection it is particularly important to observe that there can even be infringement by “offering” to sell an essential means – at the time of the offer there is unlikely to be any particular end user in mind.

Therefore:

“[102] …Grimme’s invention is “put into effect” when the Evolution machine is fitted with rubber rollers. The supply of a steel-rollered machine, which is designed and indeed promoted to enable the steel rollers to be changed for rubber rollers, is plainly the supply of the means by which that can be achieved, and is the supply of a means essential for that purpose. The fact that a steel-rollered Evolution machine, so long as it remains steel-rollered, does not infringe and is capable of lawful use as a complete machine in that state is irrelevant. The section is clearly intended to apply to, among other things, products which are perfectly capable of being used in a manner which will not constitute a direct infringement within s.60(1). The requirements as to suitability and knowledge of intended use limit the scope of the statutory tort in relation to such products, not whether the product itself is capable of lawful use without alteration, addition or adaptation.”

However, s60(2) PA 1977 also requires knowledge for there to be infringement: specifically that the supplier “knows … that those means … are intended to put the invention into effect”. Accordingly, a number of questions concerning knowledge arose in this dispute. These are listed by the Court in [107] of the judgment, and the answers discussed in [108] to [132], but are condensed here:

(i) Whose intention is referred to?

The Court considered that it was self-evidently not the supplier himself. The required intention relates to putting the invention into effect, and so the reference to intention must be to the intention of the party that is in a position to put the invention into effect, i.e. the person supplied. “The question is what the supplier knows or ought to know about the intention of the person who is in a position to put the invention into effect – the person at the end of the supply chain.” However, the person whose intention is referred to need not be the person directly supplied as “if that view were right, a party who only supplied essential means to middlemen could never fall within the provision”, which cannot have been the intention of the legislation.

(ii) How specific must the intention be?

Here the Court considered that “it was enough if the supplier knew (or it was obvious in the circumstances) at the time of his offer to supply or supply that some (disregarding freak use) ultimate users would intend to use, adapt or alter the “means essential” so as to infringe.” Several decisions of the Bundesgerichtshof (German Supreme Court) were utilised to support this view (Deckenheizung [BGH X ZR 153/03], 13 June 2006; Haubenstretchautomat [BGH X ZR 173/02], 9 January 2007; and Pipettensystem [BGH X ZR 38/06], 27 February 2007. The three earlier cases are Luftheizgerät, [BGH X ZR 176/98], 10 October 2000; DI B.V. [2004] ENPR 194 of 25 March 1999 (Oberlandsgericht, Düsseldorf); and Antriebsscheibenaufzug [BGH X ZR 247/02], 7 June 2005).

(iii) When must the intention be formed?

Again referring to the German decisions, the Court considered that “[w]hilst it is the intention of the buyer (this must mean ultimate buyer) which matters, a future intention of a future buyer is enough if that is what one would expect in all the circumstances.”

In summary, the Court noted (at [131]) that:

“…[T]he knowledge and intention requirements of Art. 26 and section 60(2) are satisfied if, at the time of supply or offer of supply, the supplier knows, or it is obvious in the circumstances, that ultimate users will intend to put the invention into effect. That is to be proved on the usual standard of balance of probabilities. It is not enough merely that the means are suitable for putting the intention into effect (for that is a separate requirement), but it is likely to be the case where the supplier proposes or recommends or even indicates the possibility of such use in his promotional material.”

Therefore, the fact that Scott not only pointed out that users could adapt the Evolution machine by simple modification, but also sold the means to do so, clearly marked him with the requisite knowledge. The Court was not moved by the contention that only a few users actually made the change. “Mr Scott knew that users would intend to make their devices infringing if it suited them and positively encouraged that intention.”

As an endnote, this Kat was going to begin this post with a comment that potatoes and the law do not often find their paths crossing, however, upon searching a well-known legal database of case law for the word “potato” he received a not altogether unrespectable 1275 hits, and so shelved this comment on the basis that it was not, in fact, true. (For the curious (and despite the obvious dangers to any feline: who isn't?), “cat” receives 1748 hits, whilst “cat” & “potato” receives 25 - the mind boggles).

That potatoe: here

Famous potatoes: here and here