A recent patent judgment from South Africa's Supreme Court of Appeal ("SCA") deals with issues of a procedural nature.
We don't see very many SCA patent judgments in South Africa, so when one does come along, we think it's worth reporting on, even if it does deal with issues that are essentially procedural in nature. This case dealt with the nature of the remedies that can be awarded in cases of patent infringement.
The judgment in the case Nu-World Industries (Pty) Ltd v Strix Ltd came out on 26 March 2020 and it was handed down by Acting Judge of Appeal Gorven. It involved an appeal from a decision of the Court of the Commissioner of Patents. The patent in this case related to domestic kettles and more particularly, technology described as a "thermally sensitive overheat control" or, as the judge put it, what is in everyday parlance called a "cut-out switch."
The owner of the patent, Strix, had sued Nu-World for infringing the patent by importing certain kettles that contained cut-out switches that were protected by the patent. It had succeeded, with the court finding that Nu-World had infringed the patent in three specific models. The interdict prohibited Nu-World from "importing liquid heating vessels (three specific names and models mentioned) containing thermally sensitive overheat controls or any other thermally sensitive overheat controls as claimed in claim 1 of the patent." The court further ordered an enquiry into the damages that had been suffered as a result of the infringement, alternatively the award of a reasonable royalty.
After the order was granted, Nu-World started importing models other than those that had been specified in the court order, but still incorporating thermally sensitive overheat controls as claimed in Strix's patent.
The legal issue
The issue that arose and found its way to the SCA was whether the interdict and the enquiry into damages (reasonable royalties) award applied to those further models too.
Judge Gorven started off by explaining that section 65(3) of the Patents Act, 1978 provides that a plaintiff in an infringement action is entitled to an interdict, delivery-up of infringing products and damages. In addition, section 65(6) says that "in lieu of damages the plaintiff may, at his or her option, be awarded an amount calculated on the basis of a reasonable royalty which would have been payable by a licensee or sub-licensee in respect of the patent concerned."
Judge Gorven then went on to clearly distinguish the interdict from the enquiry into damages (reasonable royalties) award.
The judge said this of the interdict specifically: "The interdictory relief which was granted is not limited to the three infringing controls. It includes the additional words. It goes beyond what was sought by Strix in its prayer."
He then went on to speak more generally: "Interdictory relief is essentially forward-looking and geared to prevent future unlawful conduct. The patent affords Strix as holder, a clear right to prevent any infringement, past or future, established or not. Infringements not yet committed frequently form the basis of interdictory relief."
So, the interdict that had been granted was not limited to the three models specified in the first court's order, but included any "thermally sensitive overheat controls as claimed in claim 1 of the patent".
The enquiry into damages (reasonable royalty) award
This, the judge felt, was quite different. He said that the wording of the order limited the enquiry into damages claimable "as a result of the infringement of the patent by the defendant." This, he said, "can only refer to that which had been found in the infringement part of the action...the enquiry directed to be held into damages or royalties is firmly based on, and limited to, the finding of actionable past conduct (our emphasis)... there is no suggestion in the judgment that damages for any other infringements can form part of the damages part of the action."
Judge Gorven based his decision on previous non-patent judgments that dealt with orders that dispose of a definite portion of a case. He said this: "The order concerning infringement disposed of that portion of the action concerning which of the controls of Nu-World infringed claim 1 of the patent. This has been finally determined." He went on to say this: "To allow an enquiry into whether Nu-World has infringed by other or modified controls amounts to dealing with material which belongs under the infringement part of the action on which a final judgment has been given. This is impermissible."
The interdict extended beyond what had been specified in the order of the first court, but the enquiry into damages order did not.
As we said at the outset, this judgment does not cover any substantive law. But as injunctions and enquires into damages are remedies that apply to other areas of IP law, this judgment's effect will extend beyond patents.
Originally published 05 May 2020
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