Patents - AutoStore Technology AS v Ocado Group Plc

 

Jane Lambert

Patents Court (HH Judge Hacon) Autostore Technology AS v Ocado Group Plc and others [2023] EWHC 716 (Pat) (30 March 2023)

This was a patent infringement action.  The claimant, AutoStore Technology AS ("AutoStore"), complained that the defendants had infringed two of its European patents.  The defendants denied infringement and challenged the validity of the patents on grounds of anticipation and obviousness.  They also sought declarations of non-infringement.  The claim and counterclaim came on for trial before His Honour Judge Hacon in March and April 2022.   He handed down judgment on 30 March 2023 (see AutoStore Technology AS v Ocado Group Plc and others [2023] EWHC 716 (Pat)).

The Issues

The anticipation challenge turned on whether disclosures of the invention to a prospective customer before the priority date in an email and at a presentation in Norway had been made in confidence. That in turn depended on whether Norwegian or Russian law applied and, if Russian law applied, whether such law restricted the use of the disclosure.  According to Judge Hacon, the trial proceeded in two distinct phases with different counsel on both sides for each phase.  The first phase was on the conflict of law point and the second was on everything else.

Background

AutoStore was a pioneer in automated warehouse technology.  It had invented and developed an automated storing and retrieving system ("ASRS") known as the “AutoStore ASRS".  In that system, rails forming a grid are installed on a warehouse ceiling. Robots travel along the rails in X and Y directions. They park and retrieve containers which are stacked below in vertical piles.  The system enables a higher density of storage than had previously been possible thereby saving space and costs.

The title of both EP2 928 794 B1 ("794") and EP3 070 027 B1 ("027") is "Robot for transporting storage bins".  Patent 027, is a divisional of 794. They are referred to in the judgment as "central cavity patents" after a central cavity feature that is central to the inventive concept of both inventions.  The robots are known as "black line robots" to distinguish them from an earlier generation of robots called "red line robots".

The 2nd defendant receives orders for groceries over the Internet and delivers the groceries to those customers.  It is a joint venture between Marks & Spencer and the 1st defendant.  The 1st defendant develops and licenses ASRS for use in large-scale grocery businesses.  The 6th defendant makes robots to the 1st defendant's design.  The 3rd defendant markets the 1st defendant's ASRS abroad while the 4th owns the Ocado group's intellectual property rights.    In the transcript, the judge referred to the defendants collectively as "Ocado".

Ocado had bought an ASRS with red line robots from AutoStore in 2012 but subsequently developed its own ASRS called "Ocado Smart Platform" or “OSP”.  The OSP uses 3 production robots known as "400.1", "400.02" and "500" which the judge called "productions bots".   AutoStore alleged that the OSP and production bots infringed the patents in suit.

The Inventions

Para 1 of the specification for 794 states:

“[0001] The present invention relates to a remotely operated vehicle for picking up storage bins from a storage system as defined in the preamble of claim 1. The invention also relates to a storage system using the inventive vehicle.”

The following is a drawing of the invention:

It will be noted that there are 2 sets of wheels marked "10" and "11". The wheels marked "10" run along the X rails and those marked "11" run along the Y rails.  The wheels are raised when not in use.

The Claims

AutoStore claimed claim 1 of 794 and claim 1 of 027 (paras [52] and [53] of the judgment respectively).

Claim 1 of 794 claimed:

“Remotely operated vehicle for picking up storage bins from a storage system, comprising a vehicle body comprising a first section for storing vehicle driving means and a second section for receiving any storage bin stored in a storage column within the storage system, a vehicle lifting device at least indirectly connected to the vehicle body for lifting the storage bin into the second section, a first set of vehicle rolling means connected to the vehicle body allowing movement of the vehicle along a first direction (X) within the storage system during use and a second set of vehicle rolling means connected to the vehicle body allowing movement of the vehicle along a second direction (Y) in the storage system during use, the second direction (Y) being perpendicular to the first direction (X),

characterized in that

the second section comprising a centrally arranged cavity within the vehicle body, the cavity having at least one bin receiving opening facing towards the storage columns during use, and at least one of the sets of vehicle rolling means is arranged fully within the vehicle body.”

Claim 1 of 027 is as follows:

A storage system comprising

• a remotely operated vehicle,
• a vehicle support comprising a plurality of supporting rails forming a two dimensional matrix of guiding meshes, the vehicle support being configured to guide the movements of the remotely operated vehicle in a first direction (X) and a second direction (Y) during use,
• a bin storing structure supporting the vehicle support, the structure comprising a plurality of storage columns, wherein each storage column is arranged to accommodate a vertical stack of storage bins, and the main part of the bin storing structure coincides with positions on the vehicle support where the supporting rails are crossing,
• a bin lift device arranged to convey a vehicle delivered storage bin in a direction perpendicular to the lateral plane of the vehicle support between the vehicle support and a delivery station,

characterised in that

the remotely operated vehicle comprises a vehicle body comprising a first section for storing vehicle driving means and a second section for receiving any storage bin stored in a storage column within the storage system, the second section comprising a centrally arranged cavity within the vehicle body, the cavity having at least one bin receiving opening facing towards the storage columns during use,

a vehicle lifting device at least indirectly connected to the vehicle body for lifting the storage bin into the second section,

a first set of vehicle rolling means connected to the vehicle body allowing movement of the vehicle along the first direction (X) within the storage system during use and a second set of vehicle rolling means connected to the vehicle body allowing movement of the vehicle along the second direction (Y) in the storage system during use, the second direction (Y) being perpendicular to the first direction (X), at least one of the sets of vehicle rolling means being arranged fully within the vehicle body.”

Structure of the Judgment

Although the issues were whether the patents were valid and if so whether they had been infringed, Judge Hacon did not deal with them in that order.   The topics that he addressed are as follows:

Paragraph		Topic
1		Introduction
10		Witnesses
	10	Prior disclosure
	20	Technical issues
25		The Skilled Person
26		Common general knowledge
35		The patents
	35	The central cavity patents
	37	The remaining patents
38		The central cavity invention
52		The claims
54		Construction
	54	Vehicle body
	63	Vehicle driving means
	69	First section of the vehicle body for storing vehicle driving means
	75	Vehicle rolling means
	77	At least one of the sets of the vehicle rolling means is fully within the vehicle body
	116	Bin lift device
	128	Storage bin
130		Infringement
	130	The law
	133	The inventive concept in this case
	139	Occado’s robots and storage system
	145	The infringement issues
	146	The principal differences between EP 794 and Ocado’s Production Bots
	150	A first section for storing vehicle driving means
	159	One set of vehicle rolling means fully within the vehicle body
	164	Mod 4A
	171	An equivalent
	176	Bin lift devices
199		Validity
	202	Factual background to the alleged prior disclosures
	222	The issue in relation to the alleged prior disclosures and foreign law
	227	Section 2(2) of the Patents Act 1977 and Making Available to the Public
	248	English case law on the application of foreign law
	250	European Patent Office
	256	TRIPS
	269	Rome I and Rome II
	262	Making matter available to the public in a foreign context
	265	Whether Rome II applies
	276	Art 12 - culpa in contrahendo
	324	Rome II and the Bank’s obligation of confidence
	356	The relevant law under art.12(2)(a)
	357	Russian law
	396	Conclusion on the Bank Bot Information
	398	Ten Hompel and Inventive step
	427	EP 824 and EP 481 - OCADO’S 400 and 500 BOTS
	432	EP824
440		Overall conclusion

Validity

The patents' validity was challenged on the following grounds:

• disclosures made by AutoStore to a potential distributor and end-user from Russia before the priority date had anticipated the patents; and/or
• the patents lacked an inventive step.

Anticipation

One of the conditions for the grant of a patent is that the invention is new (see s.1 (1) (a) of the Patents Act 1977).  S.2 (1) adds that an invention shall be taken to be new if it does not form part of the "state of the art." 

The "state of the art" in the case of an invention is taken by s.2 (2) to comprise "all matter (whether a product, a process, information about either, or anything else) which has at any time before the priority date of that invention been made available to the public (whether in the United Kingdom or elsewhere) by written or oral description, by use or in any other way."  It can also include matter contained in an application for another patent which was published on or after the priority date of that invention provided that matter was contained in the application for that other patent both as filed and as published and the priority date of that matter is earlier than that of the invention.

S.2 (4) provides an exception:

"For the purposes of this section the disclosure of matter constituting an invention shall be disregarded in the case of a patent or an application for a patent if occurring later than the beginning of the period of six months immediately preceding the date of filing the application for the patent and either—

(a) the disclosure was due to, or made in consequence of, the matter having been obtained unlawfully or in breach of confidence by any person—

(i) from the inventor or from any other person to whom the matter was made available in confidence by the inventor or who obtained it from the inventor because he or the inventor believed that he was entitled to obtain it; or
(ii) from any other person to whom the matter was made available in confidence by any person mentioned in sub-paragraph (i) above or in this sub-paragraph or who obtained it from any person so mentioned because he or the person from whom he obtained it believed that he was entitled to obtain it;

(b) the disclosure was made in breach of confidence by any person who obtained the matter in confidence from the inventor or from any other person to whom it was made available, or who obtained it, from the inventor; or

(c) the disclosure was due to, or made in consequence of the inventor displaying the invention at an international exhibition and the applicant states, on filing the application, that the invention has been so displayed and also, within the prescribed period, files written evidence in support of the statement complying with any prescribed conditions."

Obviousness

Another of the conditions for the grant of a patent is that the invention must involve an inventive step (see s.1 (1) (b) of the Patents Act 1977).

S.3 of the Act provides:

"An invention shall be taken to involve an inventive step if it is not obvious to a person skilled in the art, having regard to any matter which forms part of the state of the art by virtue only of section 2(2) above (and disregarding section 2 (3) above))."

The Disclosure

In 2010 the Central Bank of Russia required an improved ARSS for the storage and handling of bank notes.  Bank officials learned about AutoStore's ASS at a trade fair in Stuttgart and asked AutoStore whether they could inspect it.  They also asked EVS, a Russian company that specializes in bank and storage equipment to consider whether AutoStore's equipment could satisfy the Central Bank's needs. On 2 and 3 June 2010 officials from EVS visited AutoStore in Norway to discuss the Bank's requirements.   On 22 June 2010 AutoStore sent EVS an estimate for a system for the Bank. EVS asked AutoStore to justify the estimate because it was higher than it had expected.

AustoStore replied that the reason why the system was so expensive was that it would have to develop new robots, grids and software to meet the Bank's requirements,  It gave details of the design in an email dated 10 July 2010.  In a presentation to representatives of EVS and the Bank when they visited its premises again, AutoStore gave more information about the system that it proposed to develop. 

Ocado alleged that the email and presentation disclosed AutoStore's invention.   AutoStore admitted that it had made enabling disclosures before the priority date but relied on the s.2 (4) exception mentioned above.  It also accepted that if EVS and Bank were not bound by an obligation of confidence, both patents would lack novelty and/or an inventive step.

Whether the Invention was disclosed in Confidence

Starting from Mr Justice Megarry's requirement in  Coco v A.N. Clark (Engineers) Ltd [1968] FSR 415 that information must have been communicated in circumstances importing an obligation of confidence Judge Hacon considered what those circumstances could be.  He referred to para  7.37 of Gurry:

“The relevant factors for establishing such knowledge or notice include: the nature of the information (whether it is banal, trivial, common knowledge, commercially valuable, or intimately personal); the steps taken to preserve or emphasize the secrecy of the information (eg whether it is marked ‘confidential’ or ‘private’; or if special care is taken that there is a restricted disclosure to others); the manner in which the information was disclosed or obtained (whether it is informal, social commercial, or professional); the understanding of the parties involved (ie did they in fact regard the information as confidential or themselves as being under an obligation of confidence); and where the information is disclosed for a specific, limited purpose and it is understood, from the legal and cultural context of the disclosure, that the information will not be used for another purpose. In other words, the ‘limited purpose’ of the disclosure is a factor to be considered as part of the ‘notice of confidentiality’ test.”

The learned judge referred to the European Patent Convention ("EPC"),  The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs), Regulation (EC) no. 864/2007 of 11 July 2007 on the law applicable to non-contractual obligations (“Rome II”) and Regulation (EC) No. 593/2008 of 17 June 2008 on the law applicable to contractual obligations (“Rome I”).   Although there was nothing in the EPC that equated to s.2 (4) of the Patents Act 1977, the Examination Guidelines excluded from the state of the art matter that had been disclosed in breach of an express or implied non-disclosure agreement.  Art 39 (2) of TRIPs required WTO member states to prevent the unauthorized use or disclosure of unpublished information.   Rome II resolves disputes as to which law should apply to non-contractual obligations and Rome I disputes as to which law should apply to contractual ones.   It was common ground that any obligation not to disclose the information that AutoStore had imparted in the email and presentation would be non-contractual.   The judge held that any such obligation would arise under art 12 (2) (a) of Rome II and that the applicable law was that of Russia.

After hearing evidence from experts on Russian law, Judge Hacon concluded that nothing restricted the use of the information that AutoStore had disclosed.   It followed that the invention had been made available to the public before the priority date.  The patents in suit were therefore invalid for lack of novelty. 

Inventive Step

Although the finding of invalidity for want of novelty was enough to resolve the dispute, the judge considered whether the patents were also invalid for obviousness.  Ocado contended that both patents were invalid over German Patent Application DE 10 2009 017 241 A1 (“Ten Hompel”).

The judge noted at para [399] that the parties agreed that the statutory test of an inventive step mentioned above is to be assessed in accordance with para [23] of Lord Justice Jacob's judgment in Pozzoli SpA v BDMO SA [2007] EWCA Civ 588:

"(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) 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?"

"Persons Skilled in the Art"

At para [25] of his judgment, Judge Hacon identified  "a mechanical engineer with a background in vehicle design, robotics and/or automation" as the skilled addressee.

"Common General Knowledge"

He set out the skilled addressee's common general knowledge between para [26] and para [34].

The Inventive Concept

Jn accordance with his previous  guidance in Kwikbolt Ltd v Airbus Operations Ltd [2021] EWHC 732:, the judge identified the inventive concept of claim 1 of [137] at para [137] as follows:

"I take the view that the inventive concept of claim 1 of EP 794 has two aspects to it. The first is the idea of lifting bins into a cavity located centrally in the robot for subsequent transportation and deposition. This provides greater stability and speed of operation and allows access by any one robot to all available storage columns in the system. The second is the technical insight that having at least one set of vehicle rolling means fully within the robot body results in greater space efficiency of the storage system. Other advantages to the second aspect are identified in the specification of EP 794, namely the reduction in total load and the possibility of smaller robots, but these were given little attention by the experts or counsel and so can be left to one side."

Differences between Ten Hompel and the Inventive Concept

Judge Hacon analysed Ten Hompel between para [404] and para [415].   

Whether the Step would have been Obvious

After considering the expert evidence, the judge concluded that neither of the patents in suit lacked an inventive step over Ten Hompel.

Infringement

The judge considered whether the patents would have been infringed had they been valid.
 

Referring to Actavis UK Ltd v Eli Lilly & Co [2017] UKSC 48 and Icescape Ltd v Ice-World International BV [2018] EWCA Civ 2219, he directed himself that infringement is to be considered in two stages:

• whether an alleged infringing robot or storage system falls within any relevant claim on a normal, purposive construction; or if not
• whether it is an equivalent of the claimed invention.

He reminded himself of the reformulated questions at para [66] of Lord Neuberger's judgment in Actavis:

“(i) Notwithstanding that it is not within the literal meaning of the relevant claim(s) of the patent, does the variant achieve substantially the same result in substantially the same way as the invention, i.e. the inventive concept revealed by the patent?
(ii) Would it be obvious to the person skilled in the art, reading the patent at the priority date, but knowing that the variant achieves substantially the same result as the invention, that it does so in substantially the same way as the invention?
(iii) Would such a reader of the patent have concluded that the patentee nonetheless intended that strict compliance with the literal meaning of the relevant claim(s) of the patent was an essential requirement of the invention?”

Judge Hacon also mentioned paras [99] and [103] of his judgment in Kwikbolt Ltd:

“[99] The doctrine of equivalents as explained in Actavis requires the variant to be specified. This will be the invention of one of the claims of the patent in suit with one or more integers missing or modified. In the simplest case one integer of the claim is missing in the variant - this will be the integer in issue. The parties will know what that integer is and each may tend to tailor its inventive concept accordingly. …
…
[103] … a correct assessment of the inventive concept cannot be achieved with the variant in mind. The correct identification of the inventive concept must be done through the eyes of the skilled person, who has no notion of what the variant is. The skilled person has only the relevant claim, the specification as a whole and his or her common general knowledge to work with. Only after the inventive concept has been identified does the variant and with it the integer(s) in issue come into play so that the three Actavis questions … may be considered”.

The judge construed the claims between [54] and [129].

He considered the OSP and production bots between [139] and [144].

Between [150] and [197] he assessed whether Ocado's equipment fell within Claim 1 of 794 or Claim 1 of 027 either on a normal or equivalents construction.   He held that neither patent would have been infringed.

Declarations of Non-Infringement

Even though AutoStore did not complain that the OSP and production bots infringed EP (UK) 3 050 824 and EP (UK) 3 250 481, Ocado sought a declaration that its 400 and 500 bots do not infringe those patents.   It presented a squeeze argument contending that the patents were invalid if its bots infringed or if valid they were not infringed.   AutoStore resisted the application on the ground that the point was moot,   The learned judge held that Ocado should have its declaration,

Summary

At para [440] Judge Hacon held that 794 and 027 were invalid owing to prior disclosures in Russia but not for obviousness over Ten Hompel. Had the patents been valid they would not have been infringed by the Production Bots of Ocado’s OSP system.   He also granted declarations of non-infringement in respect of some but not all of its robots in respect of the 794 and 027 patents and also the 824 and 481 patents.

Further Information 
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