Software Patents: HTC Europe Co Ltd v Apple Inc

In HTC Europe Co Ltd v Apple Inc [2013] EWCA Civ 451 (3 May 2013), the Court of Appeal (Lord Justices Richards, Lewison and Kitchin) ventured again into what Lord Justice Lewison described at paragraph [140] of the Court's judgment as "the minefield of the exclusion from patentability of computer programs 'as such'".

The Appeal
This was an appeal from the judgment of Mr Justice Floyd (as he then was) in HTC Europe Co Ltd v Apple Inc [2012] EWHC 1789 (Pat) (4 July 2012). The judge found that two of the claims of one of Apple's patents were invalid because they related to computer programs as such and one of those claims was also invalid for obviousness. He also found that all the claims of another patent were invalid either for want of novelty or obviousness.  The first of those patents, European patent number 2,098.948, related to computer devices with touch sensitive screens that are capable of responding to more than one touch at a time. The second, European patent number 1,964,022, to ways of unlocking computer devices with touch sensitive screens.   After the trial Apple and HTC settled their dispute and HTC took no further part in these proceedings.  However, Apple invited the Comptroller to appear on the appeal "to protect the public interest by intervening to the extent necessary to prevent invalid patents being restored to the register."

Computer Programs "as such"
Art 52 (2) (c) of the European Patent Convention provides that programs for computers shall not be regarded as inventions. However, art 52 (3) adds that art 52 (2) shall "exclude the patentability of the subject-matter or activities referred to therein only to the extent to which a European patent application or European patent relates to such subject‑matter or activities as such."

In Aerotel Ltd. v Telco Holdings Ltd and Others  [2007] Bus LR 634, [2006] EWCA Civ 1371, [2007] RPC 7, [2006] Info TLR 215, [2007] BusLR 634, [2007] 1 All ER 225 the Court of Appeal propounded the following four step approach to determining whether a software implemented invention was a computer program as such:

"i) properly construe the claim;
ii) identify the actual contribution;
iii) ask whether it falls solely within the excluded subject matter;
iv) check whether the actual or alleged contribution is actually technical in nature."

(Simon Hart, who was involved in Macrossan which has heard at the same time contributed this article "Patents: Re Macrossan's Application" 5 Apr 2006). The Court of Appeal's approach was criticized by the Technical Board of Appeal in Duns Licensing Associates LP, T 0154/04 - 3.5.01 though the Court of Appeal concluded in Symbian v Comptroller-General of Patents [2008] EWCA Civ 1066, [2009] RPC 1, [2009] Bus LR 607 that most of the decisions of the Board and the English Courts were reconcilable (see my article "Software Patents: Here we go again" 9 Oct 2009. 

The first of those steps is straightforward but the second and third tend to elide and the fourth acts as a check on the previous two.   It follows that in practice the question whether a software implemented invention is patentable boils down to the question: "has the invention made a technical contribution to the known art?". Between paragraphs [45] and [49] Lord Justice Kitchin identified the following pointers:

"First, it is not possible to define a clear rule to determine whether or not a program is excluded, and each case must be determined on its own facts bearing in mind the guidance given by the Court of Appeal in Merrill Lynch and Gale and by the Boards of Appeal in Case T 0208/84 Vicom Systems Inc [1987] OJ EPO 14, [1987] 2 EPOR 74, Case T 06/83 IBM Corporation/Data processing network [1990] OJ EPO 5, [1990] EPOR 91 and Case T 115/85 IBM Corporation/Computer-related invention [1990] EPOR 107.
[46] Second, the fact that improvements are made to the software programmed into the computer rather than hardware forming part of the computer does not make a difference. As I have said, the analysis must be carried out as a matter of substance not form.
[47] Third, the exclusions operate cumulatively. So, for example, the invention in Gale related to a new way of calculating a square root of a number with the aid of a computer and Mr Gale sought to claim it as a ROM in which his program was stored. This was not permissible. The incorporation of the program in a ROM did not alter its nature: it was still a computer program (excluded matter) incorporating a mathematical method (also excluded matter). So also the invention in Macrossan related to a way of making company formation documents and Mr Macrossan sought to claim it as a method using a data processing system. This was not permissible either: it was a computer program (excluded matter) for carrying out a method for doing business (also excluded matter).
[48] Fourth, it follows that it is helpful to ask: what does the invention contribute to the art as a matter of practical reality over and above the fact that it relates to a program for a computer? If the only contribution lies in excluded matter then it is not patentable.
[49] Fifth, and conversely, it is also helpful to consider whether the invention may be regarded as solving a problem which is essentially technical, and that is so whether that problem lies inside or outside the computer. An invention which solves a technical problem within the computer will have a relevant technical effect in that it will make the computer, as a computer, an improved device, for example by increasing its speed. An invention which solves a technical problem outside the computer will also have a relevant technical effect, for example by controlling an improved technical process. In either case it will not be excluded by Art 52 as relating to a computer program as such."

At paragraph [143] of his judgment, Lord Justice Lewison regretted that because the apparently simple words of art 52 (2) and (3) 

"both our courts and the Technical Boards of Appeal at the EPO have stopped even trying to understand them. However we are so far down that road that "returning were as tedious as go o'er". Instead we are now engaged on a search for a "technical contribution" or a "technical effect". Instead of arguing about what the legislation means, we argue about what the gloss means."

He concluded at [147]:

"So the upshot is that we now ignore the words "computer program … as such" and instead concentrate on whether there is a technical contribution. It is, if I may say so, a singularly unhelpful test because the interaction between hardware and software in a computer is inherently "technical" in the ordinary sense of the word. If I buy a software package that malfunctions the software house will often offer me "technical support". But that is clearly not enough for the software to qualify as making a "technical contribution". In Symbian this court declined to provide a definition of the right kind of technical effect; but instead provided a recommended reading list."

From that "reading list" Lord Justice Lewison had distilled the following signposts as to what constituted a "technical effect" in AT&T Knowledge Ventures LP, [2009] EWHC 343 (Pat), [2009] Bus LR D51, [2009] FSR 19:

"i) whether the claimed technical effect has a technical effect on a process which is carried on outside the computer;
ii) whether the claimed technical effect operates at the level of the architecture of the computer; that is to say whether the effect is produced irrespective of the data being processed or the applications being run;
iii) whether the claimed technical effect results in the computer being made to operate in a new way;
iv) whether there is an increase in the speed or reliability of the computer;
v) whether the perceived problem is overcome by the claimed invention as opposed to merely being circumvented."

In this appeal, he substituted 

"It would be a relevant technical effect if the program made the computer a better computer in the sense of running more efficiently and effectively as a computer."

which had been suggested by Mr Justice Mann in Gemstar-Tv Guide International Inc and Others v Virgin Media Ltd and Another  [2009] EWHC 3068 (Ch), [2010] RPC 10 for his own formulation in paragraph (iv),   Lord Justice Kitchin adopted Lord Justice Lewison's revised signposts at paragraph [51] of his judgment.

The Lords Justices applied that analysis to European patent number 2,098.948 did make a technical contribution to the art and that its contribution did not lie in excluded matter.

Obviousness

Lord Justice Kitchin referred to the Court of Appeal's previous decision in Pozzoli Spa v BDMO SA and another  [2007] BusLR D117, [2007] EWCA Civ 588, [2007] FSR 37:

"(1)(a) Identify the notional 'person skilled in the art'.
      (b) Identify the relevant common general knowledge of that person.
(2) Identify the inventive concept of the claim in question or, if that cannot readily be done, construe it.
(3) Identify what, if any, differences exist between the matter cited as forming part of the "state of the art" and the inventive concept of the claim or the claim as construed.
(4) Ask whether, when viewed without any knowledge of the alleged invention as claimed: do those differences constitute steps which would have been obvious to the person skilled in the art or do they require any degree of invention?"

The Court considered whether the trial judge had followed that approach and found that he had.   Thus, the appeal against obviousness failed in respect of both patents.

Further Information

The computer program exclusion is one of my special interests and has been for nearly 30 years, If anyone wants to discuss this case or any of the issues please call me on +44 (0)20 7404 5252 or contact me through Facebook, Linkedin, twitter, Xing, or my contact page.

Success Fees and ATE Premiums in the Patents County Court: Henderson v All Around the World Recordings Ltd

As I mentioned in "Intellectual Property Litigation - the Funding Options" 10 April 2013, it was possible until the 31 March 2013 for a litigant to enter an agreement with his or her solicitors and counsel known as a conditional fee agreement ("CFA") whereby the lawyers would look to the other side for payment not only of their assessed costs but also of an uplift known as a success fee and the premium for insurance against their own and the other side's costs in case of failure known as after-the-event ("ATE") insurance if they won the case or obtained a satisfactory settlement. As I also mentioned in that article, it is still possible to enter a CFA but any success fee and ATE insurance premium must now be paid by the successful party - usually out of any damages or accountable profits he or she may receive.

On 1 Oct 2010 CPR Parts 63 and 45 and the corresponding Practice Directions were amended for proceedings before the Patents County Court ("the PCC").  Those amendments, which I discussed in detail in the "New Patents County Court Rules" of the 31 Oct 2010, controlled the time that could be spent on proceedings before the PCC and limited the costs that could be recovered from the other side to £50,000 for the determination of liability and £25,000 for an inquiry as to damages or account of profits.

After legal aid for business disputes was abolished by para 1 (h) of Schedule 2 to the Access to Justice Act 1999 I, like most intellectual property practitioners, was asked almost as a matter of course by many solicitors and their clients to accept instructions on a CFA. Although I looked into the possibility on a couple of occasions I never actually entered a CFA and I explained why in my article of 10 April 2013.  There was never very much scope for CFAs in intellectual property litigation for the reasons I gave in "No Win No Fee" on the NIPC website on 14 July 2011.  As I also observed in my 10 April article there was even less scope for CFAs in the Patents County Court with scale costs and capped totals.

The widely held assumption that the £50,000, £25,000 and stage costs caps excluded success fees and ATE premiums was challenged in Henderson v All Around the World Recordings Ltd and Another (No. 2) [2013] EWPCC 19 (27 March 2013). This was an action for infringement of a performer's rights which Judge Birss QC (as he then was) decided in Henderson v All Around the World Recordings Ltd and Another [2013] EWPCC 7 (13 Feb 2013). The claimant had entered a CFA with specialist solicitors and counsel.  Her solicitors' costs were £88,103.50 plus VAT £17654.70, her counsel's fees were £8,285 plus VAT of £1,657 and her disbursements were £889.67 plus VAT of £168.73. Her solicitors' success fee was 60% and her counsel's 100% which would have produced a grand total of £232,676.20 had it been allowed. She had not been entirely successful and the costs of an unsuccessful copyright claim and half the costs of an application were awarded against her but she had succeeded overall.  The question for Judge Birss QC was how much of those costs he should award in view of the £50,000 limit.

The claimant's case was compelling. His Honour summarized her counsel's argument at paragraph [17]:

"He submitted that the key was Miss Henderson's lack of means combined with the imbalance of power in this case between the individual claimant and the defendant record company. Mr Pearson reminded me of certain passages in my judgment in which I referred to the imbalance between Miss Henderson and All Around the World. He submitted that the presence of this combination made this case highly unusual and sufficiently exceptional to justify the course he proposed. Otherwise the claimant would simply not get justice in this case. As an individual singer songwriter with no means the claimant had no other course to take. She could not have argued the case on her own, she needed to seek legal assistance and advice from specialist solicitors and counsel like Fladgate and Mr Pearson. She had to take out an ATE insurance policy since the alternative if she lost would be bankruptcy and that would have caused her to lose her copyrights in her other music since such rights would be subject to the bankruptcy. If the cap is not lifted, Miss Henderson will remain liable for these sums but will not recover them from the defendant. She will have to pay them out of the money she presumably will recover by way of damages or an account of profits from the defendant. He argued that it is likely that the sums due will to a considerable extent be eaten up by the costs over and above the cap. These problems all arose from the combination of Miss Henderson's lack of means and the imbalance of power between an individual musician and a powerful record company. Mr Pearson repeated his point that this combination of factors was highly unusual and so to lift the cap now would not undermine the certainty of the Patents County Court costs capping procedure. He said that justice in this case simply could not be done without removing the costs cap."

The costs cap is contained in CPR 45.31:

"(1)    Subject to rule 45.32, the court will not order a party to pay total costs of more than –
(a) £50,000 on the final determination of a claim in relation to liability; and
(b) £25,000 on an inquiry as to damages or account of profits."

The CPR 45.32 exception applies where a party has behaved unreasonably.and that was not the case here. Although on its face CPR 45.31 seems quite clear the claimant's counsel argued that the court had a discretion to depart from it in circumstances other than those provided by CPR 45.32. In support of that contention the claimant relied on paragraph [20] of Judge Birss QC's judgment in  Westwood v Knight [2011] EWPCC 11 (11 May 2011):

"Rule 44.3(1)(b) provides that the court has a discretion as to the amount of costs but despite that it is clear that the limits at the various stages and the overall £50,000 limit are intended to be adhered to. The purpose of the limits is to aim for certainty for litigants (see section 5 Costs Recovery in the Final Report of the IPCUC's Working Group on Proposals for Reform of the Patents County Court). The correct approach must be to apply the limits if they can possibly be applied, recognising however that in the end the court always has a discretion as to costs (CPR r44.3) and that includes as to the amount of costs. It is a discretion which in my judgment will very rarely (if ever) be exercised to exceed the limits set by Section VII. For one thing specific exceptions are provided for (r45.41(2)). Furthermore to exercise a discretion on a wider basis in all but the most rare and exceptional case would undermine the very object of the scale in the first place. For the scale to give a measure of certainty to litigants, it has to possible to be sure that the limits will apply well before any costs are incurred and most likely before any action has even commenced. Before they embark on litigation to enforce their intellectual property rights (or defend themselves) the potential users of the Patents County Court system need to be able to make a prediction in advance as to their likely costs exposure. Their legal advisers need to be able to say with confidence that the costs capping provisions can be relied on."

The defendant submitted that passage was wrong and invited the judge to reconsider it.  His Honour accepted the invitation noting that there had been no argument on the discretion point in Westwood and that he could now decide the point with the benefit of proper argument from lawyers on both sides. He decided at paragraph [12] that he did have discretion to depart from the cap but that he should exercise his discretion very sparingly:

"Rule 44.3 is the general rule about costs applicable under the CPR. Costs are within the court's discretion and that includes the amount. The exercise of that discretion is strongly conditioned by the special rules about costs in the Patents County Court but in my judgment it has not been excluded entirely by the rules. I can only refer again to what I said in Westwood. The discretion exists but to exercise it to depart from the cap in anything other than a truly exceptional case would undermine the point of the costs capping system."

Judge Birss exercised that his discretion as follows. First  he assessed summarily the claimant's costs after deducting the sums awarded to the defendant but without taking the success fee and ATE insurance premium into account and found that she was entitled to £33,546.25 made up of £2,920 counsel's fees and £30,626.25 solicitors' fees plus VAT. Next he decided that the claimants counsel and solicitors were entitled to a 60% success fee and awarded them £1,752 and £18,375.75 respectively. He awarded the claimant a total of £52,484.25.

However, he refused to award her the ATE premium for the following reasons:

"[38] First I am not satisfied this is a sufficiently exceptional case to justify disapplying the cap. Although there was an imbalance of power between the claimant and the defendant, as a factor alone or as one combined with the claimant's lack of means, this does not take the case into truly exceptional territory. Moreover insofar as the argument was an attempt to seek to paint the defendant in a bad light, I reject the submission that the defendant's conduct explained in my main judgment, as a whole, was such as to justify any departure from the normal costs approach in the PCC. Given the circumstances in this case, if it was fair to disapply the costs capping system, that would create considerable and highly unwelcome uncertainty about costs in the PCC and would weaken access to justice for other litigants.
[39] Second I accept Mr Harbottle submission about the High Court. A litigant who wishes to recover a reasonable proportion of the totality of his of her legal costs has a clear option available, to litigate in the High Court. In that system none of the problems now faced by the claimant would arise. I do not agree that the case would simply have been transferred to the PCC if it had been commenced in the High Court. Mr Pearson submitted that justice would not be done if I did not depart from the costs cap. That submission would have provided solid grounds for the claimant to argue in favour of keeping her case in the High Court. Indeed if it was a concern to the claimant or her legal advisers in the first place, the case should have been begun in the High Court.
[40] As I have repeated on numerous occasions hitherto, the point of the Patents County Court is to facilitate access to justice for smaller litigants in intellectual property cases. To make a costs award which risks causing a winning claimant to be deprived to a significant extent of the fruits of her victory is very unwelcome. However I believe what is really happening in this case is an example of a psychological phenomenon I have become familiar with in the PCC. When the risk was in the future, the claimant wished to litigate in the Patents County Court to protect herself against the risk of an adverse costs award. That is why proceedings were brought and pursued in this court with this costs regime. The impact of the PCC cap on the claimant's actual costs if she won was predictable. If the claimant had lost, the costs cap would have been strongly relied on. The claimant was able to enforce her intellectual property rights in this case because of the predictability of the costs cap remaining in place. She was relying on it. Now that the claimant has won, the uncertainty has evaporated. The balance of risk and reward is now entirely different. In today's circumstances it now seems to the claimant quite unfair that the cap prevents her from recovering a higher share of her costs. But that is because the position after judgment is very different."

So what lessons can be drawn from this case? First, success fees and ATE premiums are caught by the CP45.31 costs cap but the court does have a discretion to allow them in exceptional circumstances.  In this case, the judge allowed the claimant just over £50,000 to cover the lawyers' success fees but he would not award her the ATE premium for the reasons set out above. It may be hard but everybody knows what hard cases make. The second lesson is that not every case is suitable for the Patents County Court. In this case the problem was the costs cap.  In others it will be the 2 day limit for trials or the limited time available for each issue.  There was been a wholesale stampede from the provincial Chancery District Registries and County Courts to the Rolls Buildings and I have to say that I have been part of that stampede. Perhaps we should revisit those courts especially now that costs are managed much more strictly in all civil courts.

If anyone wants to discuss this case or any of the issues please call me on +44 (0)20 7404 5252 or contact me through Facebook, Linkedin, twitter, Xing, or my contact page.

Intellectual Property Litigation - the Funding Options

Until the 31 March 2013 it was possible to enter a conditional fee agreement ("CFA") whereby the other side would pay any success fee. Similarly, it was possible to look to the other side to pay an after-the-event ("ATE") insurance premium.   In his Final Report Sir Rupert Jackson recommended that success fees and ATE insurance premiums should cease to be recoverable from unsuccessful opponents in civil litigation as those costs were "the major contributor to disproportionate costs in civil litigation in England and Wales".. S.44 (4) and s.46 (1) of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 which came into effect on 1 April 2013 carried those recommendations into effect.  It is, of course, still possible to enter a CFA and take out ATE insurance but any success fee or insurance premium has to be paid by the successful party out of any damages that the successful party may receive.

Sir Rupert also recommended that that

"lawyers should be able to enter into contingency fee agreements with clients for contentious business, provided that:

• the unsuccessful party in the proceedings, if ordered to pay the successful party’s costs, is only required to pay an amount for costs reflecting what would be a conventional amount, with any difference to be borne by the successful party; and

• the terms on which contingency fee agreements may be entered into are regulated, to safeguard the interests of clients."

That recommendation is implemented by s.45 of the 2012 Act and The Damages-Based Agreements Regulations 2013 (SI 2013 No 609).

As I said in my book, "Enforcing Intellectual Property Rights, A Concise Guide for Businesses, Innovative and Creative Individuals" there was never very much scope for CFAs in intellectual property litigation and I explained why in "No Win No Fee" NIPC website 14 July 2011. There was even less scope for CFAs in the Patents County Court with scale costs and capped totals.  In my entire career at the IP Bar I have never entered a CFA though I have come close on a couple of occasions.

Although there may be scope for damaged based agreements for small IP claims now that the upper limit for damages for most claims has been raised from £5,000 to £10,000, the best funding option for most small businesses is before-the-event ("BTE") insurance as I noted in "IP Insurance Five Years On" Inventors Club 23 Oct 2010. Sir Rupert observed in  his Final Report that the market for BTE insurance would be very different if his recommendations were accepted.

A company that has responded to the opportunities provided by this new market is COBRA Special Risks Ltd. ("COBRA"). One of COBRA's trading identities is COBRA Legal and IP. COBRA describes itself on its website as:

"London Market specialists providing intellectual property insurance solutions to a wide range of clients; from new start-up ventures with one great idea, to multinational corporations with extensive intellectual property portfolios.

With our expert team of IP specialists, COBRA Legal & IP can arrange insurance that will:
DEFEND your position if you are accused of infringing a third party's intellectual property;
PURSUE others who you believe are infringing your own intellectual property; and
PROTECT against damages awards which may arise from your intellectual property litigation.
With cover being available for all intellectual property rights including Patents, Registered Designs, Trademarks, Copyright and Domain Names, and anywhere in the world, COBRA Legal & IP will find the right solution for you."

What distinguishes COBRA from other BTE insurers is that its directors include a chartered patent attorney. Before joining COBRA, Ian Wishart had worked for the National Coal Board and Johnson Matthew as well as in private practice in Oxfordshire,

It appears from its proposal forms that COBRA can offer the same BTE and ATE cover as other IP insurers but it has one product that I have not seen before.   Its IP Opinion policy is said to be "specifically designed for new start-up companies, and smaller SME companies."  According to COBRA's website it would as follows:

"If the policyholder is faced with a potential infringement action, for example accused of copying a competitor's trade mark, design, or patent, then the insurer will pay for a full IP legal opinion. Consequently, the policyholder will be in a position to know whether they need to quickly negotiate a compromise, or whether they might have a defence and that their competitor is attempting to damage their business without any actual merit to their case.

If the policyholder considers that a competitor has infringed their insured IP rights, then the policy will again pay for a full IP legal opinion. The policyholder can then make an informed decision as to whether they can pursue the potential infringer, or whether this would be the wrong decision."

No doubt if the insured gets a favourable opinion he or she can seek ATE insurance or even, if the claim is big enough, from a third party investor such as Harbour Litigation Funding Ltd. which I mentioned in Litigation Funding for IP Claims, NIPC website, 18 Sept 2012. I understand that COBRA, which has connections with Harbour and other litigation funders can help to arrange such investment in a suitable case.

It is important to note that not all IP disputes have to be litigated. Generic top level domain name disputes, for instance, are more apt for settlement under ICANN's Uniform Domain Name Dispute Resolution Policy and many .uk country code domain name disputes by Nominet's Dispute Resolution Policy. Since Jospeph Dalby and I are both on the WIPO domain name dispute resolution panel we have considerable expertise in handling domain name disputes in 4-5 Gray's Inn Square. I will be chairing a seminar on Arbitration and  domain name dispute resolution at the Old Distillery Building in Dublin at 18:00 on 15 April 2013 at which Joseph and Kate Colleary of Eversheds will be the speakers.  

Should anyone want to learn more of this topic, he or she can call me on +44 (0)20 7404 5252 or contact me through Facebook, Linkedin, twitter or Xing, or through my contact page.

The IPO's New Improved Mediation Service - will it make a difference?

In "The End of Mediation?" which I posted on 4 June 2012 I wrote that the IPO was thinking of discontinuing its mediation service because it had conducted only 13 mediations in the previous 5 years and only one in the last year.  That was not because the IPO service was expensive or because it was rubbish. I had used it in 2009 and was very satisfied (see"Practice: Mediation in the IPO" 2 Oct 2009). Nor did it appear that mediation work was going elsewhere.

In my article I ventured some suggestions as to why mediation of intellectual property disputes seemed to be going out of style. At least in England and Wales.

"I think there are a number of explanations for the low take up of the IPO's mediation service. First, commercial and litigation solicitors tell me that they are getting far less intellectual property work nowadays. Getting rid of employees and getting out of commitments such as shareholders; agreements and partnerships seem to be the matters upon which my contacts in northern commercial law firms are consulted most frequently. Secondly, with the new Patents County Court rules the risks and costs of litigation have come down (see my article on the "New Patents County Court Rules" 31 Oct 2010). Thirdly, there are other forms of ADR such as examiners' opinions on patent validity and infringement and domain name dispute resolution services which appeal more to patent and trade mark attorneys and specialist solicitors. Fourthly, there are urban myths in this area of practice such as intellectual property insurance is useless, references to the Comptroller under s.61 (3) of the Patents Act 1977 or, indeed, that there are no specialist intellectual property counsel outside London which lead to bad advice. Fifthly, mediation is getting a bad name because it an extra expense resorted to by the party with the longer pocket to force concessions from the weaker party."

Nevertheless, the IPO carried out a consultation and decided that it was worth carrying on the mediation service.

The Office has re-launched the new service with a number of leaflets which are well worth reading:

• "Resolving IP Disputes" in the IP Healthcheck Series;
• "Mediation of Intellectual Property Disputes and IPO Mediation Service"
• a list of mediation providers which includes me I am glad to say;
• "Mediation and Business"; and
• "The IPO Mediation Service".

One important change since last June is that fees are now charged on a scale that takes account of the sum in dispute and the number of hours spent on mediation.   For a 1 hour mediation in Newport where the amount in dispute is less than £10,000 the fee is £55 per party which is not bad value for a specialist service. Another change is that mediation can now be conducted by telephone and at centres other than London or Newport.

Hearing officers seem to be a bit more ready to recommend mediation.  I am currently instructed in an entitlement application in the IPO where mediation has been suggested.   That did not happen in previous entitlement cases in which I was consulted.   I am not sure whether the new small claims track of the Patents County Court will encourage take up.  The Guide to the Patents County Court Small Claims Track mentions mediation as one of the available types of ADR but does not recommend it over the others.  As I pointed out in "Patents County Court - the New Small Claims Track Rules" 20 Sep 2012 the costs and risks of the new small claims track are so low a party may as well press on for judgment.

Should anyone want to learn more of this topic, he or she should call me on +44 (0)20 7404 5252 or contact me through Facebook, Linkedin, twitter or Xing, or through my contact page.

Make or Mend: Schütz v Werit reaches the Supreme Court

Schütz (UK) Ltd v Werit (UK) Ltd  [2013] UKSC 16 Supreme Court Lords Neuberger, Walker, Mance and Kerr and Lady Hale)

This was an appeal against the decision of the Court of Appeal in Schütz (UK) Ltd v Werit (UK) Ltd [2011] EWCA Civ 303, [2011] Bus LR 1510, [2011] FSR 19 which I had blogged in "Patents: Schütz (UK) Ltd v Werit (UK) Ltd" on 2 April 2011.

The point in this appeal was whether cross-bottling - the practice of replacing the a 1,000 litre bottle  that had been supplied by Schütz (U.K.) Limited, the exclusive licensee of a patent for a type of intermediate bulk carrier ("IBC") like the one pictured above, with one supplied by a third party such as Werit - amounted to making for the purpose of s.60 (1) (a) of the Patents Act 1977.  In the Patents Court, Mr. Justice Floyd held that it did not (see  Schutz (UK) Ltd v Werit UK Ltd and Another [2010] EWHC 660 (Pat), [2010] Bus LR 1244, [2010] FSR 22). The Court of Appeal (Lord Justices Ward, Jacob and Patten) disagreed and reversed his decision.

The patent in suit was European Patent (UK) 0 734 967 for a pallet container. The relevant claim was for:

"[A] Pallet container for the transporting and storing of liquids, having a flat pallet, an exchangeable inner container made of plastic material with an upper, closable filler opening and a lower emptying device and also, surrounding the inner container, one outer sleeve which consists of vertical and horizontal lattice bars made of metal which support the plastic inner container filled with liquid,
[B] the lattice bars which are configured as tubes being indented at the intersection points to form trough-like, double-walled recesses extending in the longitudinal direction of the lattice bars
[C] in such a manner that at each intersection point between the longitudinal edges of the recesses of two lattice bars lying perpendicularly one above the other there arise four contact points with a material accumulation respectively corresponding to the quadruple lattice bar wall thickness, and the four contact points of the two lattice bars being welded together at the intersection points,
[D] characterised in that the trough-like recesses of the vertical and horizontal lattice bars have a central raised part extending across the cross-section of the recesses,
[E] two lattice bars respectively lying one above the other at the intersection points are welded together at the four contact points of these raised parts and the incisions of the recesses of the lattice bars adjacent on both sides to the raised part
[F] with the contact and weld points form restrictedly elastic bending points with a reduced bending resistance moment relative to the raised part for relieving the weld joints at the intersection points upon application of static and/or dynamic pressure on the lattice sleeve."

Delivering judgment on behalf of the whole Court, Lord Neuberger construed the claim as follows:

"i. Item [A] extends to a complete IBC, i.e. a pallet, a bottle (the "inner container") and a cage (the "outer sleeve");
ii. The claimed inventiveness lies in items [D], [E], and [F], as is indicated by the introductory words "characterised in that";
iii. The inventiveness of the Patent lies in the idea of flexible weld joints in the cage, to increase its strength and durability;
iv. More specifically, the inventiveness lies in the idea of introducing a dimple on either side of the weld and a central raised portion;
v. The description of the Patent acknowledges that the bottle is "exchangeable" – i.e. replaceable."

As both Lord Neuberger and Lord Justice Jacob pointed out in their respective judgments, the photo shown above was not a picture of the patented invention but of a previous version if an IBC made by Sotralentz and Mauser which formed part of the prior art. They had inserted the picture into their judgments to make it easier to understand the issue.

The extent to which the owner of a patented product can repair it by replacing a worn component with a reconditioned part supplied by a third party had been considered by the House of Lords in United Wire Limited v. Screen Repair Services (Scotland) Limited and Another and Others [2000] 4 All ER 353, [2000] UKHL 42. In that case their lordships held that the repair of a patented product is by definition an act which does not amount to making it adding, in Lord Hoffmann's words, that "repair is one of the concepts (like modifying or adapting) which shares a boundary with "making" but does not trespass upon its territory."

The trial judge held that replacing the inner container of a Schütz IBC with a Werit bottle did not amount to making the patented product and suggested the following test:

"the correct approach is to ask whether, when the part in question is removed, what is left embodies the whole of the inventive concept of the claim", and "the inventive concept of [this claim] is wholly embodied in the Schütz cage" 

The Court of Appeal rejected that test.

Before considering United Wire and other authorities Lord Neuberger made the following preliminary observations:

"25. It seems clear that the effect of section 60(1)(a) is that a person infringes a patent for a product if that person 'makes' the product, as claimed in the patent concerned. As to the "making", that is the verb used in section 60(1)(a). As to the product being defined by the claim, that seems clear from section 125(1). In any event, if it is not the product as claimed in the patent, it is hard to see what else the subject matter of the "making" could rationally be.
26,  The word 'makes' must, of course, be interpreted contextually. In this case, the word should, in my view, be approached bearing in mind a number of considerations (which sometimes may be "apparently irreconcilable" in this field, as Robert Walker LJ pointed out in Cartonneries De Thulin SA v CTP White Knight Ltd [2001] RPC 6, para 21 quoting Attorney-General v Prince Ernest Augustus Of Hanover [1957] AC 436, 461). First, the word 'makes' must be given a meaning which, as a matter of ordinary language, it can reasonably bear. Secondly, it is not a term of art: like many English words, it does not have a precise meaning. Thirdly, it will inevitably be a matter of fact and degree in many cases whether an activity involves 'making' an article, or whether it falls short of that.
27. Fourthly, the word 'makes' must be interpreted in a practical way, by reference to the facts of the particular case. Fifthly, however, there is a need for clarity and certainty for patentees and others, and for those advising them. Sixthly, it should be borne in mind that the word applies to patents for all sorts of products, from machinery to chemical compounds. Seventhly, one should bear in mind, at least as part of the background, the need to protect the patentee's monopoly while not stifling reasonable competition.
28.  Eighthly, the word 'makes' must be interpreted bearing in mind that the precise scope of a claim may be a matter almost of happenstance in the context of the question whether the alleged infringer 'makes' the claimed product. Lord Diplock described the specification of a patent as 'a unilateral statement by the patentee, in words of his own choosing' by which he states 'what he claims to be the essential features of the new product' – Catnic Components Ltd v Hill & Smith Ltd [1982] RPC 183, 242. As Lord Hoffmann explained in Kirin-Amgen Inc v Hoechst Marion Roussel Ltd [2004] UKHL 46, [2005] 1 All ER 667, [2005] RPC 169, para 21, a claim is, or at least should be drafted 'not only … in the interest of others who need to know the area 'within which they will be trespassers' but also in the interests of the patentee, who needs to be able to make it clear that he lays no claim to prior art or insufficiently enabled products'. As Lord Hoffmann went on to explain in para 35, all sorts of factors, only some of which may appear to be rational, can influence the person drafting a claim.
29. Ninthly, where, as here, there is a decision (United Wire) of the House of Lords or this court on the meaning of the word, it cannot be departed from save for very good reasons indeed. Finally, particularly given that section 60 (like section 125) is one of the sections mentioned in section 130(7) of the 1977 Act, the word should be interpreted bearing in mind that it is included in a provision which is intended to be part of a scheme which applies in many other jurisdictions."

Lord Neuberger analysed the decisions of the House of Lords and the courts below in United Wire and also decisions of the German courts on what constitutes making a patented article. He concluded at paragraph [50] that:

"The mere fact that an activity involves replacing a constituent part of an article does not mean that the activity involves 'making' of a new article rather than constituting a repair of the original article. Repair of an item frequently involves replacement of one or some of its constituents. If there are broken tiles on a roof, the replacement of those tiles is properly described as repairing the roof, and such replacements could not be said to involve rebuilding, or "making", the roof. Indeed, replacing the whole of a deteriorated roof of a building could be regarded as repairing the building, taken as a whole, rather than reconstructing the building. There are many cases concerned with repairing obligations in leases which illustrate this point - see e.g. the discussion in Woodfall on Landlord and Tenant(October 2008), Vol 1, paras 13.32 to 13.037.12."

The Supreme Court rejected the approaches of both the trial judge and the Court of Appeal in this case.  Though Mr Justice Floyd's test was "attractive and simple to apply" it seemed "to conflict with the wording of sections 60 (1) (a) and 125 (1) as well as with the approach adopted by the Court of Appeal and House of Lords in United Wire"..On the other hand, their lordships thought that the Court of Appeal was too ready to accept that the outcome of this case was governed by United Wire and did not appear to have recognised that the question of whether replacing a part of a patented article constitutes 'making' it was a matter of fact and degree. As they had disagreed with the approaches of both courts the Court offered its his own test at paragraph [61]:

"As is clear from United Wire, this question requires the court to focus on the question of whether, when it replaces a component of the article (viz. the bottle) the subject of the Claim, Delta 'makes' that article (viz. the IBC as described in the Claim). In answering that question, I consider that it is both legitimate and helpful to consider the question of whether the bottle is such a subsidiary part of the patented article that its replacement, when required, does not involve "making" a new article."

Weighing up the various relevant factors, Lord Neuberger on behalf of the Court came to the conclusion at paragraph [77] that by replacing the bottle in the IBC, a third party does not 'make' the article identified in the claim and that Mr. Justice Floyd was right, "albeit for somewhat more nuanced reasons."

The decision between making and mending is an important one and is relevant to other intellectual property rights such as designs and possibly even copyright in the context of computing. This case, which is the second appeal on patents to reach the Supreme Court, has been overshadowed by the decision of the Indian Supreme Court in Novartis but it of far more relevance to British practitioners than the Glivec case. Should anyone want to discuss this case with me he or she can call me on +44 (0)29 7404 5252 or send me a message through my contact form. He or she can also follow me on on Facebook, Linkedin, twitter and Xing.

Sunk! The Court of Human Rights rejects the Pirate Bay's Complaint

Fredrik Neij and Peter Sunde Kolmisoppi founded one of the world's largest file sharing sites known as The Pirate Bay. They were prosecuted for offences under the Swedish copyright act (Upphovsrättslagen, 1960:729) and in the same process sued by various record companies and other copyright owners for copyright infringement in the Stockholm district court (Tingsrätt). After a hearing that lasted from the 16 Feb until 3 March 2009 they were found guilty of the charges and sentenced to a year's imprisonment on 17 April 2009. They were also ordered to pay damages of SEK30 million to the copyright owners.

They appealed to the Swedish court of appeal ((Svea hovrätt) which upheld their convictions but reduced their sentences and increased the damages award on 26 Nov 2010. They applied for permission to appeal to the Swedish supreme court (Högsta domstolen) but that court rejected their application on 1 Feb 2012.

On 20 June 2012 Mr. Neij and Mr. Kolmisoppi complained to the European Court of Rights that the judgment of the Swedish courts violated their right to freedom of expression under art 10 of the European Convention on Human Rights. The case came on before Mark Villiger, President, and Judges Angelika Nußberger, Boštjan M. Zupančič, Ann Power-Forde, Ganna Yudkivska, Helena Jäderblom and Aleš Pejchal on 19 Feb 2013.   In Neij and Another v Sweden 28 Feb 2013 the Court unanimously declared the application inadmissible.

In  reaching their decision the judges considered:

1. Whether there had been an interference with the applicants’ freedom of expression;
2. Whether the interference was prescribed by law;
3. Whether there was a legitimate aim; and
4. Whether the interference was necessary in a democratic society.

They considered those questions because art 10 (1), which guarantees freedom of expression including freedom "to receive and impart information and ideas without interference by public authority and regardless of frontiers", is qualified by art 10 (2), which subjects the exercise of these freedoms "to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society ..... for the protection of the ........ rights of others."

As to the first question, the Court  decided that the a file sharing website was entitled to protection under art 10 (1) of the Convention and, 

"consequently, the applicants’ convictions interfered with their right to freedom of expression. Such interference breaches Article 10 unless it was “prescribed by law”, pursued one or more of the legitimate aims referred to in Article 10 § 2 and was “necessary in a democratic society” to attain such aim or aims."

However, there was no doubt that such interference was prescribed by law since the applicants' convictions were in accordance with Swedish copyright and criminal law.   The court was further satisfied that the interference pursued the legitimate aim of protecting copyright to the material in question and that the convictions and damages awarded pursued the legitimate aim of “protection of the rights of others” and “prevention of crime” within the meaning of article 10 (2).   Finally, "having regard to all the circumstances of the present case, in particular the nature of the information contained in the shared material and the weighty reasons for the interference with the applicants’ freedom of expression", the Court found that the interference was “necessary in a democratic society” within the meaning of art 10 (2) of the Convention.

The interesting part of the judgment was the Court's consideration of whether the interference was necessary in a democratic society.   Relying on the Court's decision in The Observer and The Guardian v United Kingdom [1991] ECHR 13585/88, [1991] ECHR 49, (1992) 14 EHRR 153, 14 EHRR 153 the judges reiterated that the test of “necessity in a democratic society” required it to determine whether the interference complained of corresponded to a “pressing social need”.   That test cannot be applied in absolute terms:

"On the contrary, the Court must take into account various factors, such as the nature of the competing interests involved and the degree to which those interests require protection in the circumstances of the case. In the present case, the Court is called upon to weigh, on the one hand, the interest of the applicants to facilitate the sharing of the information in question and, on the other, the interest in protecting the rights of the copyright-holders."

As to the weight afforded to the interest of protecting the copyright‑holders, the Court stressed that intellectual property was protected by art 1 of Protocol No. 1 to the Convention (Anheuser-Busch Inc. v. Portugal [GC], no. 73049/01, § 72, ECHR 2007‑I) [2007] ECHR 40, [2007] ETMR 24, 23 BHRC 307, (2007) 45 EHRR 36). The Court reiterated the principle that genuine, effective exercise of the rights protected by that provision does not depend merely on the State’s duty not to interfere, but may require positive measures of protection (Öneryıldız v. Turkey [GC], no. 48939/99, § 134, ECHR 2004‑XII . [2004] ECHR 657, 18 BHRC 145, (2005) 41 EHRR 20, [2004] Inquest LR 108).   The judges concluded that the respondent state had to balance two competing interests which were both protected by the Convention in which the state benefits from a wide margin of appreciation (see Ashby Donald and Others v France  [2013] ECHR 28; and Recommendation CM/Rec(2007)16 of the Committee of Ministers to member states on measures to promote the public service value of the Internet). 

Noting that the Swedish authorities were obliged not only by their copyright statute but also by the Convention to protect the copyright owners' rights, the Court found that there were "weighty reasons for the restriction of the applicants’ freedom of expression" and that the Swedish courts advanced "relevant and sufficient reasons to consider that the applicants’ activities within the commercially run Pirate Bay website amounted to criminal conduct requiring appropriate punishment. In that respect, the Court reiterated that the applicants were only convicted for materials which were copyright-protected.

The Court reiterated that the nature and severity of the penalties imposed were factors to be taken into account when assessing the proportionality of interference with the freedom of expression guaranteed by art 10 (see Cumpǎnǎ and Mazǎre v. Romania [GC], no. 33348/96, § 111, ECHR 2004-XI, [2004] ECHR 692, (2005) 41 EHRR 14 and Skałka v. Poland, no. 43425/98, § 41, 27 May 2003 [2003] ECHR 256 ). In the present case, the Court considered that the prison sentence and the award of damages could not be regarded as disproportionate. In reaching that conclusion, the Court had regard to the fact that the Swedish courts had found that the applicants had not taken any action to remove the torrent files in question, despite having been urged to do so. Instead they had been indifferent to the fact that copyright-protected works had been the subject of file-sharing activities via The Pirate Bay.

The balancing exercise applied by the ECHR in Neji is not very different from that of the Court of Justice of the European Union in Scarlet [2011] EUECJ C-70/10, [2012] ECDR 4 which I discussed in "Injunctions against ISPs Part II: the CJEU's Judgment in Scarlet" 11 Dec 2011 or indeed Mr. Justice Arnold's in Dramatico and EMI which I blogged in "Injunctions against ISPs Part III: Dramatico Entertainment Ltd and Others v British Sky Broadcasting Ltd. and Others" 21 Feb 2012 and "Injunctions against ISPs Part V: EMI Records Ltd and Others v British Sky Broadcasting Ltd and Others" 5 March 2012.

This is an important decision but it is not one that the entertainments industry is likely to welcome with unqualified rapture.   For a start, the Court did find that file sharers were entitled to freedom of expression under art 10 which for the moment is incorporated into English law by the Human Rights Act 1998,. That freedom can be curtailed under art 10 (2) only in so far as may be necessary in a democratic society for the protection of the rights of others.  Secondly, the Court restated that the test of “necessity in a democratic society” required any interference with freedom of expression to be justified by a “pressing social need” and that the test can never be applied in absolute terms:   

If anyone wants to discuss this post or indeed  freedom of expression or copyright generally he or she should call me on on +44 (0)20 7404 5252 or send me a message through my contact form. . I can also be followed on Facebook, Linkedin, twitter and Xing.

The Samsung and Apple Litigation - Round 2 to Apple

According to Wikipedia, Samsung Electronics Co., Ltd, is the world's largest information technology company in terms of revenue. Apple Inc. is number two. Samsung supplies the famous Galaxy smart phone and Apple the well known iPhone. 

Over the last few years Samsung and Apple have fought each other in the world's court rooms.(see "Apple Inc. v. Samsung Electronics Co., Ltd" in Wikipedia).  In the last round over Apple's registered Community design, Apple came off second best (see Jane Lambert "Apple v Samsung - the Appeal" 26 Oct 2012) and was made to eat humble pie (see Jane Lambert "Samsung v Apple: 'Be you never so high ....'." 2 Nov 2012 and "Samsung v Apple: the Reasons" 30 Dec 2012).  In Samsung Electronics Co. Ltd v Apple Retail UK Ltd and Another (No. 1) [2013] EWHC 467 (Pat) and Samsung Electronics Co Ltd v Apple Retail UK Ltd and Another (No. 2) [2013] EWHC 468 (Pat) Apple did rather better. Mr. Justice Floyd held three of Samsung's patents to be invalid though he found that two of those patents would have been infringed had they been valid.

Although both cases were part of the same claim they were tried on different days and argued by different counsel.    In the first case Samsung sued Apple for infringement of European patents (UK) numbers 1,005,726 and  1,357,675 and Apple counter-claimed for revocation.   Those patents were for inventions relating to "channel coding", a method of detecting errors in digital transmissions.  In the second, Samsung sued Apple for infringement of European patent (UK) number 1,714,404 which related to the structuring of data streams and again Apple counter-claimed for revocation.   Mr. Justice Floyd delivered judgment in both cases on 7 March 2013.

All three patents claimed priority from South Korean grants:

• European patent (UK) 1,005,726 from Korean patent no 11380/98;
• European patent (UK) 1,357,675 from Korean patent no  9926221; and
• European patent (UK)  1,714,404 from Korean patent no 2004045127.

In the first case Mr. Justice Floyd considered the law on entitlement to priority.   Reminding himself that Lord Justice Kitchin had held in Medimmune Ltd v Novartis Pharmaceuticals UK Ltd and Others [2012] EWCA Civ 1234 (10 Oct 2012) at paragraph [151] that

"151. Section 5(2)(a) of the Patents Act 1977 provides that an invention is entitled to priority if it is supported by matter disclosed in the priority document. By section 130(7) of the Act, section 5 is to be interpreted as having the same effect as the corresponding provisions of Article 87(1) of the European Patent Convention. Article 87(1) says that priority may be derived from an earlier application in respect of the 'same invention'.
152. The requirement that the earlier application must be in respect of the same invention was explained by the Enlarged Board of Appeal of the EPO in G02/98 Same Invention, [2001] OJ EPO 413; [2002] EPOR 167:

"The requirement for claiming priority of 'the same invention', referred to in Article 87(1) EPC, means that priority of a previous application in respect of a claim in a European patent application in accordance with Article 88 EPC is to be acknowledged only if the skilled person can derive the subject-matter of the claim directly and unambiguously, using common general knowledge, from the previous application as a whole."

153. The approach to be adopted was elaborated by this court in Unilin Beheer v Berry Floor [2004] EWCA (Civ) 1021; [2005] FSR 6 at [48]:

"48. …….The approach is not formulaic: priority is a question about technical disclosure, explicit or implicit. Is there enough in the priority document to give the skilled man essentially the same information as forms the subject of the claim and enables him to work the invention in accordance with that claim."

154. In Abbott Laboratories Ltd v Evysio Medical Devices plc [2008] EWHC 800 (Pat), I added this:

"228. So the important thing is not the consistory clause or the claims of the priority document but whether the disclosure as a whole is enabling and effectively gives the skilled person what is in the claim whose priority is in question. I would add that it must "give" it directly and unambiguously. It is not sufficient that it may be an obvious development of what is disclosed.""

The judge also considered paragraph [61] of Lord Justice Jacob's judgment in Unlin where he discussed the extent to which priority could be lost if the invention described in the priority document included features A, B and C, but was claimed in the patent with only two of those features.   That had also been discussed as part of the reasoning in G02/98 Same Invention [2001] OJ EPO 413; [2002] EPOR 167 which was also cited in Medimmune.  Lord Justice Jacob said:

"Mr Carr also relied on those passages of G02/98 quoted above. He submitted that here, just as in the Board's discussion, there were three features, A+B+C (free of play, lip length limitation, and minimum thickness). They are disclosed in combination – hence, he says, a claim to one without the other two cannot have priority. I would reject that submission too. The discussion at this point in the Board's reasoning is in danger of being considered in too abstract a way. Helpful though it was in the Board's reaching its ultimate conclusion, what really matters is the conclusion itself. The fact of the matter is that when features A+B+C are disclosed, a lot must turn on what they actually are. Some inventions consist of a combination of features – the invention consists in the very idea of putting them together. In other cases that is simply not so – the features are independent one from the other. Whether, given a disclosure of A+B+C, there is also a disclosure of A or B or C independently depends on substance, not a formula. The ultimate question is simply whether the skilled man can derive the subject-matter of the claim from the priority document as a whole."

The judge concluded that "the task for the court is therefore:

"(a) to read and understand, through the eyes of the skilled person, the disclosure of the priority document as a whole;
(b) to determine the subject matter of the relevant claim;
(c) to decide whether, as a matter of substance not of form, the subject matter of the claim can be derived directly and unambiguously from the disclosure of the priority document."

His lordship added at paragraph [107]:

"It follows from the authorities cited above that the subject matter of a claim is not the same thing as the scope of the monopoly it claims. Thus, the test for determining priority is not the same as that for novelty. In determining novelty one simply asks whether that which is described in an earlier document would, directly and unambiguously, fall within the monopoly granted by the patent claims. To put it another way, the issue is whether the earlier disclosure would infringe: see Smithkline Beecham PLC's Patent [2005] UKHL 59; [2006] RPC 10. That the law is different for priority can be illustrated by the example in Unilin I have quoted above. The Court of Appeal there recognised that the disclosure of A+B+C may in some circumstances not provide priority for a claim to or A or B alone or to A+B. By contrast, the disclosure of A+B+C will normally deprive a claim to A, B or A+B of novelty. The additional presence of other features in the disclosure would not matter. Applying the infringement test, A+B+C will still infringe, whether the claim is to A, B or A+B. When testing for priority one must therefore guard against simply asking whether the features called for by the claim are present in the priority document. The test for claiming priority in respect of the same invention has more substance, and is less formal, than that."

The judge compared the subject matter of the principal claim of each of the patents and considered whether they were derived directly and unambiguously from the disclosure of the South Korean grant.   In respect of European patent (UK) no 1,005,726 he concluded at paragraph [131] that the subject of matter of the claim was not directly and unambiguously derivable from the priority document.

"The priority document only discloses the use of data rate/frame length and information derived from the service type in the determination of the number of frames. The priority document does not disclose the use of parameters independent of the datastream being transmitted, such as information derived from channel conditions or aspects of the receiver, base station and user class. Yet these are clearly and as a matter of substance part of the subject matter of claim 1."

The judge made a similar comparison between European patent (UK) 1,357,675 and the Korean patent from which it claimed priority and arrived at a similar conclusion.  Samsung had admitted that, if the claims of that patent were not entitled to priority, then the patent would be invalid in the light of an intervening prior publication. As his lordship had held that those claims were not entitled to priority, then it followed that that was invalid.   There was also intervening prior art in respect of European patent (UK)  1,714,404.  In addition, Samsung had sought to amend the patent.   After comparing the patent with the Korean grant Mr Justice Floyd concluded at paragraph [103] of his judgment in the second case that the proposed amended claim was not entitled to priority.

Apple had also argued that each of Samsung's patents was obvious in the light of the prior art.   The judge reminded himself of Mr Justice Kitchin's words in  Generics (UK) Ltd and Others v H Lundbeck A/S [2007] RPC 729, [2007] RPC 32, [2007] EWHC 1040 (Pat) which Lord Hoffmann had approved in Conor Medsystems Inc v Angiotech Pharmaceuticals Inc and Others  [2008] RPC 28, [2008] UKHL 49:

"The question of obviousness must be considered on the facts of each case. The court must consider the weight to be attached to any particular factor in the light of all the relevant circumstances. These may include such matters as the motive to find a solution to the problem the patent addresses, the number and extent of the possible avenues of research, the effort involved in pursuing them and the expectation of success."

He considered the approach of the Court of Appeal in Pozzoli SpA v BDMO SA and Another [2007] BusLR D117, [2007] EWCA Civ 588, [2007] FSR 37

"(l)    (a)   Identify the notional "person skilled in the art""

         (b)   Identify the relevant common general knowledge of that person;
(2)     Identify the inventive concept of the claim in question or if that cannot readily be done, construe it;
(3)     Identify what, if any, differences exist between the matter cited as forming part of the "state of the art" and the inventive concept of the claim or the claim as construed;
(4)      Viewed without any knowledge of the alleged invention as claimed, do those differences constitute steps which would have been obvious to the person skilled in the art or do they require any degree of invention?"

Applying that analysis to the prior art in relation to each patent he concluded that each patent was invalid for obviousness.

There was no dispute as to the test of infringement and hence no discussion of the law.   

This case will be referred to in future for its discussion on priority.   If there is a difference in drafting style between South Korea and the West the point may arise again now that South Korea has taken its place among the world's top five patent offices.  On the other hand it may be a one off.   Only time will tell.

Should anyone want to discuss this case, entitlement to priority, obviousness or patent law in general I and my four colleagues who form the intellectual property group of 4-5 Gray's Inn Square will be glad to talk to you.   You can make an appointment by calling 020 7404 5252 or you can contact me through my contact form. You can also follow me on on Facebook, Linkedin, twitter and Xing.