EPLAW Patent Blog

UK - Xena Systems v. Cantideck and Conquip Industrial

Xena Systems Limited v. (1) Cantideck (2) Conquip Industrial, Patents County Court, HH Judge Birss QC, London, UK, 18 January 2013, Case No. [2013] EWPCC 1

This judgment relates to an inquiry into damages for patent infringement, following the defendants’ submission to judgment on liability in the main proceedings. In it, following consideration of a number of heads of damage claimed by the patentee, Xena Systems Limited (“Xena”), His Honour Judge Birss QC awarded damages in the amount of £233,986.76 for the total lost income caused by the defendants’ patent infringement together with interest losses at 8% for a certain period.

The patent-in-suit, EP (UK) 1 392 939, owned by Xena, concerns an improved type of rolling platform used in the construction industry (e.g. to allow materials to be loaded on and off by crane). Another, non-infringing, type of platform used in the construction business is known as a “fixed” platform. At the start of the period relevant to infringement (which was 2006-2007), Xena was the market leader in loading platforms in the UK. It hired out (but did not sell) both rolling and fixed platforms. Its only other competitor at the time in relation to rolling platforms was a company called Cranetech, which sold or hired non-infringing rolling platforms.

UK - Hollister v Medik Ostomy

Hollister Incorporated and Dansac A/S v Medik Ostomy Supplies Limited, 9 November 2012, Court of Appeal, Case No. A3/2012/0331 and 0334

In an important decision for the assessment of compensation for infringement of intellectual property rights, the Court of Appeal in London has held that when calculating an “account of profits” it is not permissible for a defendant simply to allocate a proportion of general overheads to an infringing activity, in order to reduce the level of profits payable to the rights holder.  On the contrary, the defendant must show that the relevant overheads are properly attributable to the infringing activity.

The effect of this decision is that we are likely to see an increase in patentees and holders of other intellectual property rights electing to receive an account of profits, instead of general damages, following successful infringement actions in the UK.

Background

Medik was a parallel importer of the claimants’ ostomy products. Medik had admitted trade mark infringement and, after reviewing Medik’s disclosure, the claimants made an election for an account of profits. At the subsequent inquiry, Judge Birss ordered Medik to pay half of its net profits assessed on the normal basis under English law. Both sides appealed. A number of issues fell to be determined by the Court of Appeal, including the correct approach to assessing net profits.

ES - ROS Roca v. Envac Centralsug

ROS Roca S.A. v. Envac Centralsug Aktiebolag, Supreme Court, Barcelona, Spain, 17 October 2012, Case No. 431/2012, with thanks to Luis Fernández-Novoa and Álvaro Velázquez, Hoyng Monegier, for sending in the judgment and a summary in English 

"The Spanish Supreme Court decided on a much debated point of Patent Law in Spain which had been subject to controversial decisions in the past and which the Supreme Court has now finally settled, which is the date on which European Patents shall be considered as effective in Spain.

"In the first instance decision by Commercial Court No. 3, which had granted the complaint for infringement of a waste management process patent filed by ENVAC against ROS ROCA and dismissed the counterclaim for invalidity filed by the latter, the Court had stated that the date from which damages (to be compensated according to the hypothetical royalties fee – which resulted in one of the biggest compensations ever granted by Patent Courts in Spain) should be starting to accrue is the date of the filing of the translation into Spanish of the European Patent before the Spanish Patent Office, in accordance with the provisions set by the Spanish Royal Decree implementing article 65 of the EPC (filing of a translation within 3 months after publication of the grant by the European Bulletin).

BE - Claim for “guiding surface” is not limited to shape depicted in drawing

Germeau Carrière v. Core Distribution and Urban Sporting Goods, expedited proceedings on the merits, Liège court of appeal, Belgium, 21 February 2012, case number 2010/RG/1369  

The respondents (Core Distribution and Urban Sporting Goods) are the co-proprietors of a European patent for an “extending ladder and associated manufacturing methods” (EP 1 448 865).  One of the features of the patented ladder is that in contains columns to which rings are coupled with an interior guiding surface for contacting the exterior surfance of another column. The appellant, who was found to infringe the patent at first instance, argued that the claim should be construed to mean that the said guiding surface was flat and that, since its own guiding surface allegedly had a different shape, there could therefore be no infringement.

The appellant found support for its argument in the description (§ 42) and the drawings (figure 7) of the patent specification, which described the embodiment of figure 7 as “[columns] with … shapes including flat surfaces … so as to preclude relative rotation between the columns”. The court of appeal rejected this argument and held that, on proper construction of the claims, figure 7 only depicted one possible embodiment of the invention and that no such limitation could be read into claim 1 or any other claim of the patent. What was claimed was a guiding surface, not a flat guiding surface. The court thereby confirmed the first instance decision.

However, the court reversed the first instance decision to the extent that it held that a court adjudicating a patent claim in expedited proceedings on the merits could not order to the restitution of the costs of the saisie carried out prior to the start of the proceedings. The reason for this being that no damages can be awarded in expedited proceedings. According to the court of appeal, however, these costs do not amount to damages, but to procedural costs, and could therefore be reimbursed to the respondents in expedited proceedings, without needing to start separate genuine proceedings on the merits.

Read the decision (in French) here.

Head note: Philippe de Jong

SE - Time Bar for Damage Claims Clarified

The Swedish Supreme Court Clarifies the Law on Time Bar for Damages Claims, by Erik Ficks, Roschier

The case
The Swedish Supreme Court recently had the opportunity to provide guidance on the issue of time bar for damages claims in patent infringement cases (NJA 2011 s. 270). The case concerns a long-standing patent dispute between Lely Industries N.V. and Lely Sverige Aktiebolag, on the one side, and DeLaval International AB, on the other side. In this particular case, the Svea Court of Appeal had ruled that Lely had infringed DeLaval's patent for software included in milking robots. The Court of Appeal ordered Lely to pay DeLaval damages of in total 1.7 million SEK (roughly 170,000 EUR) based on compensation for loss of sales of four robots and for the use of three robots.

Read the entire contribution (in English) here.

Read the Supreme Court decision (in Swedish) here.
Read the District Court decision (in Swedish) here.  

FR - Biogaran v. Negma: Compensation of damages caused by an interim injunction on a patent later found to be invalid

Biogaran v. Laboratoire Medidom, Laboratoires Negma, Tribunal de grande instance (3rd chamber, 3rd division), Paris, 27 January 2012, Case No. 09/17355, with thanks to Sabine Age and Marta Mendes Moreira, Veron & Associes, for sending in the judgment, summary and translation in English

A patentee who has obtained an interim injunction from a court to restrain infringement of a patent which is subsequently held invalid must compensate the defendant for losses sustained as a result of being prevented by the injunction from selling allegedly infringing goods.

The judgment handed down on 27 January 2012 by the tribunal de grande instance of Paris is the first reported decision of a French court on the consequences of the enforcement of a preliminary injunction against an alleged infringer of a patent which is later held invalid.

 

DE - Calculation of damages for patent infringement on the basis of a substantially "increased" royalty rate

Calculation of damages for patent infringement on the basis of a substantially "increased" royalty rate District Court Munich I, Germany, 25. March 2010, Case No. 7 O 17716/09

The District Court Munich I had to decide on a damages complaint based on patent infringement.

The starting point of the decision is the so far well-established case law of the German Federal Supreme Court, according to which damages calculated according to the calculation method of a reasonable royalty had to be based on a royalty rate, rational business parties would have agreed upon in normal course of business. However, by advancing and specifying this case law, the District Court found inter alia that rational business parties would take into account that a patent infringement lawsuit triggering the respectively substantial legal costs was necessary for collecting royalty payments. This would justify a significant increase of the royalty rate for calculating damages over a royalty rate on which rational business partners had agreed upon contractually in a pre-trial situation.

The pre-trial royalty rate typically included a discount for the uncertainty of infringement and validity in the pre-trial situation. Since such situation was not comparable with a situation in which a patent litigation has delivered significant legal certainty, a substantially increased royalty rate had to be assumed to be agreed upon by rational business partners. Therefore, the Court held that the reasonable royalty rate to be determined in damages proceedings based on patent infringement is usually substantially exceeding a royalty rate business parties would have agreed upon in normal course of business in a pre-trial situation. Thus, the present decision improves the patentee's chances to collect higher damages based on the calculation method of the reasonable royalty in the future in Germany. A more comprehensive summary on this decision will follow shortly.

Read the decision (in German) here.

Head note: Tilman Mueller-Stoy

UK - Les Laboratoires Servier v. Apotex / damages

Les Laboratoires Servier, Servier Laboratories Limited v. Apotex Inc, Apotex Pharmachem Inc, Apotex Europe Limited and Apotex UK Limited, High Court of Justice, Chancery Division, Patents Court, London, UK, 29 March 2011, Case No. [2011] EWHC 730 (Pat)

The issue decided in this case is whether a patentee who has obtained an interim injunction from a court to restrain infringement of a European patent (UK) which is subsequently held invalid should compensate the defendant for losses sustained as a result of being prevented by the injunction from selling goods manufactured by the defendant in infringement of a valid foreign patent owned by the same group of companies.

Servier contends that, as a matter of public policy, Apotex cannot recover damages for being prevented from selling a material whose manufacture would have been unlawful because it infringed a valid foreign patent. This is an application of the rule of law identified by the Latin maxim ex turpi causa non oritur actio (no action can arise from an illegal or immoral act), also known as the illegality defence.

Justice Arnold concludes that Apotex’s claim is barred by the ex turpi causa rule. It follows that Apotex must repay Servier the money which Norris J ordered Servier to pay Apotex.

Read the earlier post here.

Read the judgment (in English) here.
 

BE – Iverness Medical / Ulti Med Products – infringement and five year time bar

Iverness Medical Switzerland v. Ulti Med Products, Commercial court of Ghent, 27 May 2010, Docket number A/08/2023

The Ghent commercial court finds that Ulti Med Products has infringed European patent 291 194 B2 for a specific analytical test device and an analytical method in which this test device is used.  Ulti Med did not deny having commercialized the contested product ('D Dimer Test', but said that Iverness’ rights were exhausted because the products had allegedly been placed on the market by Iverness or with its consent.

This defence was rejected by the court because there was not enough evidence of the alleged exhaustion. The court also rejected Ulti Med’s argument that no damages were due for some of the infringing sales as a result of the five year time bar for infringement claims under Belgian patent law. According to the court, the fact that Iverness carried out a 'saisie'  at Ulti Med, interrupted the statutory prescription term. An expert was appointed for the final calculation of the damages.

Read the judgment (in Dutch) here.

Head note: Philippe de Jong

UK - Virgin Atlantic v. Premium Aircraft

Virgin Atlantic v. Premium Aircraft, Court of Appeal (Civil Division), London, UK, 21 December 2009, Case No. [2009] EWCA Civ 1513

In previous proceedings, Contour, the defendant, had been found to have infringed Virgin Atlantic's patent for a specific design of aircraft seats which could be used as beds for long haul flights.  In this reported decision, questions relating to, inter alia, a stay of the inquiry as to damages and the terms of the final injunction were before the Court of Appeal. 

The Court of Appeal refused Contour's request for a stay of inquiry and held that a successful claimant is entitled to pursue an inquiry for damages even if there was a possibility of an appeal to a higher court. 

Regarding the terms of the injunction, it was held that an injunction with a carve-out permitting Contour to continue manufacturing infringing products provided certain conditions were met was appropriate.  The conditions required Contour to pay £10,000 to Virgin Atlantic for each infringing product manufactured, the parent company of Contour to give a guarantee and the buyer of the infringing products to give an undertaking that the planes concerned would not be used on a particular flight route which was already well-used by Virgin Atlantic. 

Read the judgment (in English) here.