Patents - Ensygnia IP Ltd v Shell UK Oil Products Ltd

Shell Petrol Station

Author Ianmcm Public Domain Courtesy of the author Soutce Wikimedia Commons

Jane Lambert

Court of Appeal (Lords Justices Phillips and Birss and Lady Justice Whipple) Ensygnia IP Ltd v Shell UK Oil Products Ltd and others [2024] EWCA Civ 1490 (5 Dec 2024)

This was an appeal against the judgment of Miss Charlotte May KC sitting as a deputy judge of the High Court in Ensygnia IP Ltd v Shell Oil Products Ltd and others [2023] EWHC 1495 (Pat) of 26 June 2023.  That had been a claim by Ensygnia IP Ltd. ("Ensygnia") against Shell Oil Products Ltd, Shell International Petroleum Ltd. and Shell Information Technology BV ("Shell") for the alleged infringement of UK patent GB 2,489,332 C2 and a counterclaim by Shell for revocation of the patent.  In para [300] of her judgment, Miss May held that the patent was invalid for added matter, extension of scope, and obviousness.  However, she also stated that the patent would have been infringed had it been valid.   

The Appeal

 Ensygnia appeared against the finding of invalidity.  By a respondent's notice Shell challenged the deputy judge's construction of the patent which led to her finding that the patent would have been infringed had it been valid.  The appeal was heard by Lord Justice Phillips, Lord Justice Birss and Lady Justice Whipple on 6 Nov 2024.   The Court delivered judgment on 5 Dec 2024 (see Ensygnia IP Ltd v Shell UK Oil Products Ltd and others [2024] EWCA Civ 1490).  Lord Justice Birss delivered the lead judgment with which Lord Justice Phillips and Lady Justice Whipple agreed. They dismissed Shell's respondent's notice and allowed Ensygnia's appeal on one issue but dismissed the appeal on the other issues.

The Patent

 The patent related to the use of graphical images that encode information such as barcodes and QR codes that are sometimes referred to as graphical objects or GOs.  An application for the patent was filed on 25 Nov 2010 and granted on 8 May 2013.   The specification of that patent was referred to as the B specification in the judgment.  The patent was amended twice after grant.  The patent in suit which was published on 11 Aug 2021 was referred to as the C2 specification.

The Alleged Infringement

Ensygnia complained that Shell infringed claims 1 and 7 of the patent in suit by using QR codes printed on sheets of paper or card in its petrol stations as part of a method of paying for petrol. A customer would point his or her mobile phone camera at the QR code.  The mobile would use the information in the QR code to communicate with servers on the internet to establish the customer's identity and debit his or her account.  

The First Instance Judgment

Miss May held that the question of whether Shell had infringed the patent in suit turned on the construction of the C2 specification. If claim 1 required the use of a GO printed on a card or paper (referred to as a "static") as Ensygnia contended then Shell would have infringed.  If the claim allowed the use of GO on a phone or computer screen as Shell contended then Shell would not have infringed.  Ms May preferred Ensygnia's construction with the result that the patent in suit would have been infringed had it been valid.  The learned deputy judge also found that the amendment of the patent had resulted in its invalidity for extension of scope, added matter and obviousness.  

The Issues

Ensygnia appealed against the finding of invalidity in order to rely on the deputy judge's finding of infringement. Shell challenged Miss May's construction of the C2 specification to avoid liability for infringement in case Ensygnia's appeal succeeded,   There were, therefore, two issues in the appeal:

• the construction of the claims and the allegations of added matter and extension of scope; and
• obviousness.

Lord Justice Birss decided to deal with them in that order.

Construction

Claim 1 of the C2 specification (patent in suit) was as follows:

"A method comprising:
a portable device:
obtaining a graphical encoded information item which is displayed on a display of a computing apparatus, wherein the computing apparatus comprises the display and an electronic apparatus, and wherein the display is a sign;
decoding the encoded information from the encoded information item;
and
transmitting a first message to first server apparatus, the first message including the decoded information and a first identifier identifying the device or a user of the device, wherein the decoded information includes an apparatus identification information item for allowing identification of the computing apparatus,
the first server apparatus:
receiving the first message from the device;
establishing the identity of the user of the device, where establishing the identity of the user comprises using the first identifier to determine if the user is registered with the first server apparatus;
in response to establishing the identity of the user, authorising the user to access a service; and:
using the apparatus identification information item to transmit a signal to the electronic apparatus, and
the electronic apparatus providing the service to the user."

Ensygnia contended that the "sign" referred to a static (a QR code or other GO printed on paper or card) rather than a GO on a screen.   The importance of the distinction between a static and a GO on a screen is that the latter can be changed between transactions.   Shell argued that the claim did not mention statics at all and could apply to GOs on screens.

Lord Justice Birss acknowledged that when considered in isolation the claim could be read either way. However, one of the embodiments of the patented invention was an electronic entry system which contained the following words:

"In such an embodiment, the computing apparatus 10 may comprise an electronic door lock. The encoded information item 112, 312, such as a GO as described above, may be displayed on a sign geographically proximate to the electronic door lock. In embodiments outside the scope of the claims, the GO 112, 312 may be provided on an electronic display geographically proximate to the electronic door lock. In such embodiments, the encoded information item may be periodically updated following receipt of signals from the first server apparatus 14."

Miss May read the claim in conjunction with the above passage and concluded that Ensygnia had been right because the words "in embodiments outside the scope of the claims, the GO .... may be provided on an electronic display geographically proximate to the electronic door lock" required the GO to be static.  Lord Justice Birss agreed with her at para [26] of his judgment:

"Read in context the passage in the C2 specification concerning the electronic door lock, and the words in claim 1, would be understood together by the skilled reader such that the "sign" which displays the GO is a non-electronic static sign such as a piece of paper near the lock. The only thing I would add is that reading such specific limitations into general words in patent claims is not usually conducive to reasonable certainty for third parties (see the Protocol on the Interpretation of Art 69 EPC) but one is essentially driven to this conclusion in order to make sense of the claim and specification as a whole in the C2 version of the patent."

He, therefore, dismissed the respondent's notice.

Extension  of  Scope

Lord Justice Birss referred to s.76 (3) (b) of the Patents Act 1977 which provides:

"No amendment of the specification of a patent shall be allowed under section 27 (1), 73 or 75 if it—
..................
(b) extends the protection conferred by the patent."

He also said that the extension of protection conferred by the amendment of a patent which should not have been allowed is a ground for the revocation of the patent under s.72 (1) (e).

He noted that Miss May had referred to paras [106] to [108] of his judgment in Hospira v Genentech [2014] EWHC 3857:

"[106] This rarely comes up at trial in the UK, no doubt because the law is clear and usually easy to apply. The correct approach is to compare the scope of the claims as granted with the scope of the claims as proposed to be amended. In both cases the scope is that of the claims properly construed in accordance with the Protocol. If the proposed amended claim covers something that would not have been covered by the granted claims then the prohibition is engaged.
[107] Usually to make the argument good the person challenging the amendment needs to identify a concrete thing which did not fall within the scope as granted but which would fall within the scope after amendment if the amendment was allowed. If such a thing cannot be identified in concrete terms, that is usually an indication that there is no extension. Because the prohibition is absolute, the thing need not be commercially realistic.
[108] The purpose of the prohibition is the protection of the public. Once a patent has been granted, the public can rely on its scope and know that it will not get any wider by amendment. There is no corresponding prohibition pre-grant. The law of added matter is different. It applies both pre- and post-grant."

He stated in para [31] of his judgment in Ensygnia that 

"the exercise involves a comparison of the claims in the granted B Specification with those in the C2 specification, bearing in mind in this case that relevant amendments were made not only to the claims but also to the passage concerning the electronic door lock." 

 His lordship noted that there were two differences between claim 1 in the C2 specification (the patent in suit) and claim 1 of the B specification (the patent as granted). The first was that the words "wherein the computing apparatus comprises the display and an electronic apparatus, and wherein the display is a sign" in the patent in suit were not present in the "obtaining" clause of claim 1 of the B specification. The other difference related to the final words of the claim.

After construing claim 1 in the B specification and claim 1 in the C2 specification Lord Justice Birss concluded that the patent as granted did not cover an approach that uses a static sign to display the GO whereas the effect of the amendments made after grant was that that approach was covered by the claim in the C2 specification. S.72 (1) (e) of the Act therefore applied and he dismissed the appeal on the issue of extension of scope.

Added Matter

Lord Justice Birss referred to s.76 (3) (a) of the 1977 Act:

"No amendment of the specification of a patent shall be allowed under section 27(1), 73 or 75 if it—
(a) results in the specification disclosing additional matter......"

He also mentioned s.72 (1) (d):

"Subject to the following provisions of this Act, the court or the comptroller may ... by order revoke a patent for an invention on the application of any person (including the proprietor of the patent)] on (but only on) any of the following grounds, that is to say—
....................
(d) the matter disclosed in the specification of the patent extends beyond that disclosed in the application for the patent, as filed, or, if the patent was granted on a new application filed under section 8 (3), 12 or 37 (4) above or as mentioned in section 15 (9) above, in the earlier application, as filed ......"

He said that Miss May had referred correctly to paras [2] to [7] of Lord Justice Jacob's judgment in Vector Corporation v Glatt Air Techniques Inc.  [2007] EWCA Civ 805, [2008] Bus LR D101, [2008] RPC 10:

"[2] Article 123(2) of the European Patent Convention provides:

'A European patent application or a European patent may not be amended in such a way that it contains subject-matter which extends beyond the content of the application as filed.'

So far as is relevant here, the Patents Act 1977 provides:

'76 (3) No amendment of the specification of a patent shall be allowed … if it-
(a)  results in the specification disclosing additional matter…'

[3] The wording is not quite the same (e.g. 'matter' for 'subject-matter') but no one doubts that the meaning of s.76 (3) (a) is exactly the same as that of Art 123 (2). I so held in Merrell Dow v HH Norton 1st October 1996. Since the case is unreported, I set out my reasons again:

Section 76 must be given a purposive construction. Its purpose is to stop patentees inserting information after filing which enables them to support their claims. The addition of information irrelevant to claims as sought to be amended is a mere explanation which harms no one and assists the public. There is apparently no direct authority in the United Kingdom relating to amendments of a patent specification by way of an additional acknowledgement of prior art.

However, there is a more general principle stated by Aldous J in Bonzel v Intervention (No 3) [1991] RPC 553 at 574. He stated the test for examining whether amendment involved the adding of subject matter to be as follows:

(1) To ascertain through the eyes of the skilled addressee what is disclosed, both explicitly and implicitly in the application.
(2) To do the same in respect of the patent as granted.
(3) To compare the two disclosures and decide whether any subject matter relevant to the invention has been added whether by deletion or addition. The comparison is strict in the sense that subject matter will be added unless such matter is clearly and unambiguously disclosed in the application either explicitly or implicitly.

It will be noted that Aldous J used the expression "subject matter" whereas s 76 does not use that expression; it merely uses the expression "matter". Is there a difference? Article 123 of the European Patent Convention provides [I set it out].

It might be suggested that our draftsman in s 76 was intending to do something different from that in art 123 and more especially so because s 76 is not one of those sections which by s 130 (7) of the Patents Act 1977 is expressly stated to be intended to have as near as is practicable the same effect as the corresponding article of the European Patent Convention. However, I have come to the firm conclusion that s 76 is not intended to have a different effect from art 123.

Mr Thorley points out that any such construction could lead to a perfectly absurd result. An amendment could be effected in the European Patent Office to a patent application or, in the case of opposition proceedings, a granted patent which would be perfectly in accordance with the European Patent Convention but which, if there was a difference of meaning between s 76 and art 123, could result in invalidity here. That is too absurd for words. I think s 76 in this respect has exactly the same meaning as art 123.

[4] In Richardson-Vicks' Patent [1995] RPC 568 at 576 I summarised the rule in a single sentence:

'I think the test of added matter is whether a skilled man would, upon looking at the amended specification, learn anything about the invention which he could not learn from the unamended specification.'

I went on to quote Aldous J in Bonzel. His formulation is helpful and has stood the test of time.

[5] The reason for the rule was explained by the Enlarged Board of Appeal of the EPO in G1/93 ADVANCED SEMICONDUCTOR PRODUCTS/Limiting feature [1995] EPOR 97 at [Reasons 9]:

'With regard to Article 123 (2) EPC, the underlying idea is clearly that an applicant shall not be allowed to improve his position by adding subject-matter not disclosed in the application as filed, which would give him an unwarranted advantage and could be damaging to the legal security of third parties relying upon the content of the original application.'

[6] Mr Richard Arnold QC provided a clear articulation as to how the legal security of third parties would be affected if this were not the rule:

'The applicant or patentee could gain an unwarranted advantage in two ways if subject-matter could be added: first, he could circumvent the 'first-to-file' rule, namely that the first person to apply to patent an invention is entitled to the resulting patent; and secondly, he could gain a different monopoly to that which the originally filed subject-matter justified.

[7] Kitchin J has recently helpfully elaborated upon the Bonzel formulation in European Central Bank v Document Security Systems [2007] EWHC 600 (Pat), 26th March 2007:

'[97] A number of points emerge from this formulation which have a particular bearing on the present case and merit a little elaboration. First, it requires the court to construe both the original application and specification to determine what they disclose. For this purpose the claims form part of the disclosure (s.130(3) of the Act), though clearly not everything which falls within the scope of the claims is necessarily disclosed.
[98] Second, it is the court which must carry out the exercise and it must do so through the eyes of the skilled addressee. Such a person will approach the documents with the benefit of the common general knowledge.
[99] Third, the two disclosures must be compared to see whether any subject matter relevant to the invention has been added. This comparison is a strict one. Subject matter will be added unless it is clearly and unambiguously disclosed in the application as filed.
[100] Fourth, it is appropriate to consider what has been disclosed both expressly and implicitly. Thus the addition of a reference to that which the skilled person would take for granted does not matter: DSM NV's Patent [2001] RPC 25 at [195]-[202]. On the other hand, it is to be emphasised that this is not an obviousness test. A patentee is not permitted to add matter by amendment which would have been obvious to the skilled person from the application.
[101] Fifth, the issue is whether subject matter relevant to the invention has been added. In case G1/93, Advanced Semiconductor Products, the Enlarged Board of Appeal of the EPO stated (at paragraph [9] of its reasons) that the idea underlying Art. 123 (2) is that that an applicant should not be allowed to improve his position by adding subject matter not disclosed in the application as filed, which would give him an unwarranted advantage and could be damaging to the legal security of third parties relying on the content of the original application. At paragraph [16] it explained that whether an added feature which limits the scope of protection is contrary to Art 123 (2) must be determined from all the circumstances. If it provides a technical contribution to the subject matter of the claimed invention then it would give an unwarranted advantage to the patentee. If, on the other hand, the feature merely excludes protection for part of the subject matter of the claimed invention as covered by the application as filed, the adding of such a feature cannot reasonably be considered to give any unwarranted advantage to the applicant. Nor does it adversely affect the interests of third parties.
[102] Sixth, it is important to avoid hindsight. Care must be taken to consider the disclosure of the application through the eyes of a skilled person who has not seen the amended specification and consequently does not know what he is looking for. This is particularly important where the subject matter is said to be implicitly disclosed in the original specification.'"

Lord Justice Birss said that all of those paragraphs were worth reading in full but in paras [47] and [48] of his judgment. he drew attention to aspects of this law of particular relevance in the present case without seeking to depart from Lord Justice Jacob's summary:

"[47] The purpose of this part of the law is to stop patentees inserting information after filing. The reason this is important is to protect the public. Without this prohibition the patentee could otherwise gain unwarranted advantages by circumventing the first to file system and gaining a monopoly different from that which the original filing justified. It is important to consider what is disclosed both expressly but also implicitly, otherwise the law would be unfair to the patentee. On the other hand the comparison between what is disclosed in the application as originally filed and what is disclosed after the amendments is a strict one, otherwise the law would be unfair to third parties. Therefore subject matter will be added unless it is clearly and unambiguously disclosed in the application as filed. It is also important to avoid hindsight, particularly when it is suggested something is disclosed implicitly. The skilled person reading the application has not seen the amended specification and so does not know what they are looking for.
[48] One dimension to the law of added matter which is not mentioned in Vector v Glatt is the distinction between coverage and disclosure which is the basis of the line of Court of Appeal cases from AC Edwards v Acme [1992] RPC 131 and then Texas Iron Works [2007] RPC 207 to AP Racing v Alcon [2014] EWCA Civ 40. The point is that general words may cover a variety of things without disclosing a particular one (or more) of them. So in AC Edwards the application described a device using a coil spring and the granted claim used the general expression 'spring means' which had not been in the application. A device which used a leaf spring rather than a coil spring was held to infringe but this fact, that the term 

'spring means' covered other types of spring in addition to coil springs, did not mean there necessarily was a disclosure of a leaf spring (which would have been added matter). The finding was that no new ideas would be identified by a skilled person reading the granted patent than would occur to them reading the application, therefore there was no added matter."

As Lord Justice Birss noted in para [50], Miss May found no clear and unambiguous disclosure of a static sign in the application and doubted that it would have occurred to the skilled address that the invention could be implemented with a sign which was not electronic or which could not be changed.  His lordship held that there was no clear and unmistakable disclosure of a non-electronic static sign as the means to present the graphical object and as that was the idea disclosed in the C2 specification, there was added matter.

There was a difference between claim 1 in the application and claim 1 of the patent in suit:

Claim 1 of the Application

Claim 1 of the C2 Specification

the first server apparatus: receiving the first message from the device; establishing the identity of the user of the device, where establishing the identity of the user comprises using the first identifier to determine if the user is registered with the first server apparatus; in response to establishing the identity of the user, authorising the user to access a service; and: providing the service to the user via the computing apparatus using the apparatus identification information item

the first server apparatus: receiving the first message from the device; establishing the identity of the user of the device, where establishing the identity of the user comprises using the first identifier to determine if the user is registered with the first server apparatus; in response to establishing the identity of the user, authorising the user to access a service; and: using the apparatus identification information item to transmit a signal to the electronic apparatus, and the electronic apparatus providing the service to the user

Lord Justice Birss analysed the text in italics and concluded that there was no additional matter.  He observed that the analysis had not been put to the deputy judge.  On this one issue he found for Ensygnia.

Obviousness

At para [65], Lord Justice Birss observed that s.1 of the Patents Act 1977 provides that a patent may only be granted for an invention which satisfies that section's conditions one of which is that the invention must involve an inventive step (s.1 (1) (b)).  S.3 provides that 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 the state-of-the-art. He referred to the Court of Appeal's judgment in Pozzolli v BDMO [2007] EWCA Civ 58 at [66]:

"The approach has three preparatory steps leading up to the question whether the invention is obvious. The first step is to identify the person skilled in the art, and the common general knowledge. The next step is to identify the inventive concept of the claim or if it cannot be done to construe the claim. The third preparatory step is to identify the differences if any which exist between the individual item of cited prior art and the claim. Having done that the court is in a position to consider the question of obviousness itself, which is whether those differences constitute steps which would have been obvious to a person skilled in the art without hindsight. Pozzolli does not require that these steps are identified explicitly in a judgment. Nevertheless they are conceptually useful to have in mind when addressing obviousness."

His lordship noted that Miss May had identified the skilled addressee, the common general knowledge and the nearest prior art. She had construed the claim rather than identify the inventive concept.

The prior art upon which Shell relied was EP 2,073,160 A1 for the Transmission of encoded information from a terminal to a central server via a mobile device by way of a multidimensional barcode invented by Joachim Schmidt ("Schmidt").  It described a payment scheme with a mobile, a server and a terminal by which the mobile displayed and scanned a barcode to pay for something.  One of the examples in Schmidt related to the collection of fares for local public transport (LPT). It was common ground that Schmidt disclosed all the features of claim 1 of the patent in suit except for the requirement that "the display was a sign" printed on card or paper. Miss May rejected the anticipation argument.  In so doing she identified the difference between claim 1 and Schmidt which was the third Pozzolli step.  Relying on the experts' testimony that statics could be used for the embodiment described in the patent the deputy judge concluded that the patent in suit was obvious over Schmidt.

Ensygnia made the following submissions at the hearing of the appeal which Lord Justice Birss set out in para [71]:

"i) The judge's reading of Schmidt overall was not supported by either expert and was wrong. Schmidt is directed to dynamic systems. The essentially uncontradicted evidence of Prof Martin was that Schmidt did not consider a static sign. The LPT system is also stated expressly to be dynamic.
ii) The judge's approach to Schmidt's LPT system was wrong in part because it is expressly dynamic (the previous point) and also because the LPT embodiment by mutual agreement of the experts is confusing and poorly explained.
iii) There was no evidence which suggested that a skilled person would, as opposed to could, modify the LPT to use a static display.
iv) The judge's reasons are inadequate because they do not grapple with the difference between a sign with a barcode which cannot be changed from transaction to transaction and a sign in which the barcode happens to be the same for successive transactions but could change."

His lordship considered Schmidt's LPT payment system between [72] and [75] and then addressed each of the above submissions between [75] and [95].  He concluded at [96] that there was a sufficient evidential basis on which it was open to the deputy judge to find obviousness.  None of her alleged errors stood up to analysis on appeal. He therefore dismissed that part of the appeal

Comment

In his judgment, Lord Justice Birss analysed and explained in detail the law on the extension of patent protection, added matter and obviousness.  There are plenty of cases on added matter but not so many on the extension of protection.  Those two prohibitions are often confused because they derive from paragraphs (a) and (b) of the same subsection.   His lordship's explanation of the policy for those provisions is particularly helpful. 

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