UK: IP Bulletin – Winter issue - 21 February 2012



The Supreme Court considers the validity of Human Genome Sciences' Neutrokine Patent

In an important case for the bioscience industry the Supreme Court, while considering the matter of industrial application, concluded that the English courts should as a matter of policy follow established EPO jurisprudence.

Human Genome Sciences Inc v Eli Lilly and Co [2011] UKSC 51, 2 November 2011

The Supreme Court has allowed an appeal from the Court of Appeal's decision that claims to a new member of a family of proteins were invalid as not being capable of industrial application.

In 2008, Eli Lilly and Company (Lilly) applied to revoke Human Genome Sciences Inc's (HGS) European Patent (UK) 0,939,804 (the "Neutrokine Patent"). The Neutrokine Patent disclosed the nucleotide and amino-acid sequence of Neutrokine-, one of a family of proteins (the TNF ligand superfamily or TNF family) important in inflammation and immune responses. Kitchin J held that the patent was invalid for lack of industrial applicability. Before this decision, Lilly had brought opposition proceedings in the European Patent Office (EPO). The EPO had revoked the European patent on the ground that the claimed invention lacked any inventive step. Both the Patents Court and EPO decisions were appealed. The EPO appeal was heard before the hearing in the Court of Appeal.

The EPO Technical Board of Appeal ("TBA") allowed the appeal and held that the European patent as amended in the proceedings was valid. The Court of Appeal then heard its appeal and decided to uphold Kitchin J's decision rather than following the TBA. Leave to appeal to the Supreme Court was given to HGS (and Lilly cross-appealed on an insufficiency issue). The Supreme Court allowed the appeal and dismissed the crossappeal. The case was remitted to the Court of Appeal to deal with outstanding issues.

The central issue in the Patents Court and before the EPO was whether the Neutrokine Patent satisfied the industrial application requirements of Articles 52 and 57 of the European Patent Convention (EPC) so as to enable HGS to claim the encoding gene for Neutrokine-. Kitchin J examined the jurisprudence of the EPO for applicable principles, but concluded that the patent was invalid for lack of industrial applicability (a decision upheld by the Court of Appeal). The TBA, meanwhile, decided that the patent did satisfy the industrial application requirement. The Supreme Court recognised the importance of the case for the bioscience industry (the BioIndustry Association intervened with submissions) and concluded that the UK courts should as a matter of principle follow established EPO jurisprudence. It further held that Kitchin J and the Court of Appeal had not properly applied the relevant principles and considered the effect of these principles on the biotechnology industry. Accordingly, HGS's appeal was allowed and Lilly's crossappeal was dismissed.

Patent relating to alumina coatings for cutting tools invalid for insufficiency

A recent case concerning Sandvik's patent for alumina-coated cutting inserts raises interesting points on insufficiency, chemical compound selection patents and the burden of proof for a positive case for non-infringement.

Sandvik Intellectual Property AB v Kennametal UK Ltd and another [2011] EWHC 3311 (Pat), 15 December 2011

The High Court has held that a patent relating to alumina coatings for cutting tools was invalid on the ground of insufficiency. The High Court also held that all (but one) of the claims were invalid for obviousness.

The Claimant, Sandvik, sued the Defendants, Kennametal UK Limited and Kennametal Europe GMBH ("Kennametal"), for infringement of Sandvik's European Patent (UK) No. 0 603 144 entitled "Oxide coated cutting tool", the oxide in question being alumina. Kennametal denied infringement and counterclaimed for revocation on the grounds of lack of novelty, obviousness and insufficiency.

Arnold J examined both the law and evidence on the types of insufficiency pleaded by the Defendants: "classical insufficiency", ambiguity and excessive claim breadth, and concluded that the first two types of insufficiency had been established. He also considered the Defendants' claim that the patent claims were invalid for obviousness on the ground that the difference over the prior art was an arbitrary selection, and held that this type of obviousness was not limited to chemical compound selection patents (an argument submitted by counsel for Sandvik which, according to the judgment, provoked lively dispute between counsel).

Concerning infringement, Arnold J held that, in the circumstances of the case, the burden of proof of a positive case for non-infringement fell on Kennametal, in particular because Kennametal had not revealed this case to Sandvik in sufficient time for Sandvik to carry out the necessary procedures (a TEM analysis) to test this case, despite Sandvik's requests for Kennametal to do so, and Kennametal had not itself carried out these tests. If Kennametal had made a timely disclosure of its case to Sandvik in response to requests, perhaps the burden of proof may not have been on Kennametal.

Arnold J concluded that Sandvik had established that, if the patent were valid, the Kennametal grades of insert made by two of the process combinations would infringe the product claims. However, the Kennametal grades of insert made by the other process combinations were not found to infringe the product claims, as sufficient experimental evidence to prove infringement had not been provided.

Too obvious to track suspected criminals and terrorists

In this Court of Appeal decision concerning devices which may be used to track suspected criminals and terrorists, the Court has allowed an appeal from a High Court decision that a method of breaking through the security system of the GSM mobile telephone system was not obvious and was valid.

MMI Research v Cellxion and others [2012] EWCA Civ 7, 24 January 2012

The Court of Appeal has allowed an appeal from a High Court decision that a method of breaking through the security system of the GSM mobile telephone system was not obvious and therefore valid.

The case concerned a patent for "IMSI catchers", devices used by police and security services to discover the mobile 'phone numbers of suspected criminals and terrorists thus enabling the 'phone and user to be tracked as the suspect moves from place to place. The catcher device involved the creation of a false base station which would transmit to mobile phones and by giving a different location area code (LAC) from the area where the mobile phone was located would cause the phone to communicate its IMSI to the false base station.

At the first trial the judge rejected Cellxion's argument that prior sales of the device and its manuals were novelty-destroying in that they made the invention available to the public, finding that it was not proved that an inspection of the machines would reveal how they worked and that sales and disclosures were under a seal of confidence. Following that hearing Cellxion applied to admit fresh evidence on the issue, which included further materials, which might have accompanied the device sold, and the matter was remitted.

Although the court agreed that the defendants had not proved that the patent was anticipated by prior sales of the device by the patentee, Sir Robin Jacob, giving judgment, disagreed with the judge's finding that the invention was not obvious in the light of one item of cited prior art (the Fox article). Two of the judge's reasons for finding non-obviousness had overlooked a concession to the contrary by the complainant's expert. MMI's expert had conceded in cross-examination that given the idea of using a virtual base station, one would arrive at the patent. Both experts accepted that once a skilled team got that far, the key question of the idea of using an out-of-area Location Area Code for the virtual base station would occur to them. The third reason, based on the view that the skilled man would consider an analogy with call interception in analogue telecommunications in interpreting the prior art, was in error because there was no parallel in the analogue world to the method in issue here (Fox was clearly talking about catching IMSIs).

The appeal was allowed on the basis that the patent was invalid for obviousness over the Fox article.

Supplementary protection certificates and combined vaccines

In a decision helpful for pharmaceutical companies marketing combined vaccines, the European Court has given its ruling on questions referred by the Court of Appeal in the Medeva case.

Medeva BV v Comptroller General of Patents, C-322/10, 24 November 2011

In a decision helpful for pharmaceutical companies marketing combined vaccines, the Court of Justice of the European Union (the "CJEU") has given its ruling on questions referred by the Court of Appeal in the Medeva case, which involved the refusal of a supplementary protection certificate (SPC) under Regulation 469/2009/EC for a patent for a method of preparation of an acellular vaccine. The preparation consisted of two antigens as active ingredients. The vaccine was not marketed as a single vaccine.

Instead, it was marketed in combination with other vaccines against childhood diseases.

Medeva had obtained five different marketing authorisations (MA) for the combinations and made five applications to the Intellectual Property Office (IPO) for SPCs. The IPO refused to grant the SPCs and concluded that the product (which was the subject of four of the applications) was not "protected" by the patent within the meaning of Article 3(a) of the SPC Regulation. In the case of the fifth application, the IPO decided that the MA relied upon was not a valid authorisation to place the product on the market, as required by Article 3(b) of the SPC Regulation. Medeva appealed. The Court of Appeal referred questions to the CJEU.

The CJEU has stated that the test to identify the product protected by the basic patent must be based on the product described in the wording of the claims, rather than whether the marketed product would infringe those claims. However, in its ruling on one question, which related to the grant of a SPC where the protected product is marketed in combination with other products, the Court pointed out that where there were good reasons for administering the protected pharmaceutical in connection with other active substances, such as in the case of combined vaccines, extended protection would not be denied to the patented ingredients.


Detention of counterfeit goods

In a ruling that may be disappointing for rights-owners, the European Court has provided some guidance as to what is required in order to obtain both detention of counterfeit goods and remedies for infringement.

Koninklijke Philips Electronics NV v Lucheng Meijing Industrial Company Ltd and others, Nokia Corporation v Her Majesty's Commissioners of Revenue and Customs, Joined cases C-446/09 and 495/09, 1 December 2011

The CJEU has ruled on questions referred to it by the Belgian and English courts concerning the interpretation of the old Counterfeit Goods Regulation (1383/2003) and its successor (Regulation 3295/94). The ruling is disappointing for rights-owners but provides some guidance as to what is required in order to obtain detention of goods and remedies for infringement.

The English question

Nokia Corporation applied for judicial review of HM Revenue & Customs' refusal to continue to detain, or suspend the release of, a consignment of counterfeit telephones which were in the UK in transit from Hong Kong to Colombia, under the external transit procedure. Kitchin J held that in order for products bearing trade marks to constitute "counterfeit goods" within the meaning of the new regulation, they must infringe someone's trade marks in the territory in question, and that trade marks regulations made clear that a trade mark owner could only prevent another from using its mark "in the course of trade". Since the telephones had not been put on the market in the UK, they were not counterfeit within the meaning of the new Regulation. Nokia appealed to the Court of Appeal, which referred the following question to the CJEU:

"Are non-Community goods bearing a [Community Trade Mark] which are subject to customs supervision in a member state and in transit from a non-member state to another non-member state capable of constituting "counterfeit goods" within the meaning of Article 2(1)(a) of [the new Customs Regulation] if there is no evidence to suggest that those goods will be put on the market in the EC, either in conformity with a customs procedure or by means of an illicit diversion?"

The Belgian question

In 2002 (before the new Regulation came into force), Belgian Customs and Excise detained a consignment of shavers (from Shanghai) suspected of infringing the intellectual property rights (IPRs) of Koninklijke Philips Electronics NV (namely, international design registrations for shavers and copyright in the external appearance of the shavers). The goods were held in Belgium under temporary import arrangements and the country of destination was not stated. Philips sought a ruling from the Court of First Instance in Antwerp that its IPRs had been infringed. As part of this claim, it sought to rely on Article 6(2)(b) of the old Regulation, and argued that the court should use as its starting point the fiction that the shavers seized had been manufactured in Belgium, and then apply Belgian law for the purposes of establishing the infringement. Before ruling, the court referred the following question to the ECJ for a preliminary ruling:

"Does Article 6(2)(b) of the old Counterfeit Goods Regulation constitute a uniform rule of Community law which must be taken into account by the court of the member state which, in accordance with Article 7 of the Regulation, has been approached by an IPR holder, and does that rule imply that, in making its decision, the court may not take into account the temporary storage status/transit status and must apply the fiction that the goods were manufactured in that same member state in which they were situated (the production fiction), and must then decide, by applying the law of that Member State, whether those goods infringe the IPR in question?"

In relation to the English question, the CJEU ruled that the customs authorities can only legitimately detain goods if they have evidence to suspect that the manufacturer, importer or distributor intends to release them onto the market in the EU.

In relation to the Belgian question, the CJEU ruled that the "production fiction" could not be applied, and that in order to obtain a remedy for infringement (such as destruction of the goods), the rights-owner had to prove not only that the goods would infringe an intellectual property right applicable within the EU if released onto the market there, but also that their release into circulation in the EU was envisaged.


Copyright infringement, the photograph and the London Bus

This interesting case, before the Patents County Court, concerned an iconic photograph of a red routemaster bus against a monochrome background. Examining a number of issues concerning copyright in photographs, HHJ Birss QC held that the Defendants' image infringed the Claimant's copyright in a photograph.

Temple Island Collections Limited v (1) New English Teas Limited (2) Nicholas John Houghton [2012] EWPCC 1

The Claimant, Temple Island Collections Ltd, claimed ownership of copyright in a photographic image. The image itself was in black, white, grey and red; with the Houses of Parliament and Westminster bridge shown in grey, the sky in white, with no visible clouds, and the bus in red. The image was created from a photograph taken by Mr Fielder of the Claimant, which was subsequently digitally enhanced using software. The resulting image was used by the Claimant on souvenirs of London.

The Defendants image was developed, by combination and manipulation, from a set of photographs taken by Mr Houghton, the second Defendant.

The Defendant's image

HHJ Birss QC held that the copyright work was original (resulting from Mr Fielder's intellectual creation, his choices of angle of shot and field of view and his subsequent manipulation, all of which had an effect on the composition itself). The judge also concluded that the Defendants' work did reproduce a substantial part of the Claimant's work. In his decision, the judge was influenced firstly by the nature of the claimant's work which he described as a "photographic work" (its appearance was the product of deliberate choices and deliberate manipulations rather than a mere photograph) and secondly by the collection of other similar works relied upon by the Defendants which emphasized how different independent expressions of the same idea looked. HHJ Birss QC concluded that the Defendants' work infringed the Claimant's copyright.


Image processing and patentability - Hewlett Packard Development BL O/466/11 Hewlett-Packard Development Company LP, 21 December 2011 o46611.pdf

The Intellectual Property Office has allowed an appeal from the decision of an examiner that a method of image-processing was not patentable as relating solely to a computer program. It was held that the claimed invention (a computerised method of processing images so that words could be associated with them, making them searchable on a database) came within the Vicom decision of the European Patent Office Board of Appeal, and was not excluded from patentability.

The proposed European Unitary Patent and Patents Court

Report of the European Scrutiny Committee: Enforcement of patent rights, 20 December 2011 xlv/42804.htm

A report of the Parliamentary Scrutiny Committee on the proposed European Unitary Patent and Patents Court has been published. The report details the committee's intention to invite representative organisations from the patent profession to give evidence to it in the new year.

Amendments to Regulations under the Patents Co-operation Treaty

Source: PCT Notification No. 199, 8 December 2011

The World Intellectual Property Organisation has published the most recent amendments to the Regulations under the Patent Co-operation Treaty (PCT). The amendments (which relate to, inter alia, priority documents, international filing dates and minimum documentation) were adopted on 5 October 2011 and will come into effect on 1 July 2012.

Recent guidance on the use of experimental evidence in The Patents County Court Liversedge v Owen Mumford Ltd and another [2011] EWPCC 34, 29 November 2011 In a recent case, HHJ Birss QC has given guidance on the use of experimental evidence in patent litigation in The Patents County Court (PCC). In the case, the evidence was relevant to the issue of infringement and satisfied the cost-benefit test for PCC proceedings. Small Claims in The Patents County Court – a call for evidence

IPO: Implementing the Hargreaves review

In response to the recommendations of the Hargreaves review, the Intellectual Property Office (IPO) has issued a call for evidence on the planned small-claims service for intellectual property cases in the Patents County Court (PCC).

The IPO is seeking comments on the proposed service and possible change of name of the PCC, to reflect the range of IP cases heard, by 16 February 2012.

Louis Vuitton figurative mark for a locking device – the appeal

Louis Vuitton Malletier v OHIM, Case T-237/10, 14 December 2011 Index=0&doclang=EN&mode=req&dir=&occ=first&part=1&cid=712302

The EU General Court has partially upheld an appeal against an OHIM Board of Appeal decision that a Louis Vuitton figurative mark for a locking device, registered for a range of goods in classes 9, 14, 18 and 25, was invalid for lack of distinctive character under Article 7(1)(b) of the CTM Regulation (207/2009/EC).

Opposition to registration of word mark MONSTER ROCK as a CTM

Monster Cable Products Inc v OHIM, Case T216/10, 23 November 2011 target=blank>

The EU General Court has upheld a decision of the OHIM Board of Appeal, allowing an opposition to registration of a proposed word mark MONSTER ROCK as a Community trade mark, based on the existence of an earlier UK mark for the words MONSTERS OF ROCK, registered for a range of audio and visual media recording and reproduction devices in class 9. The MONSTER ROCK application covered a wide range of audio equipment including loudspeakers, stereo amplifiers and accessories in class 9. The court found that the marks were strongly similar and that there was a likelihood of confusion between them.

Opposition to registration of a composite mark containing the word ALPINE

Hrbek v OHIM, Case T-434/10, 15 November 2011 target=blank>

The EU General Court has upheld a decision of the OHIM Board of Appeal, allowing an opposition to registration of a composite mark containing the word "Alpine" in relation to all goods covered in the application other than toys and games. (The goods covered were primarily goods related to hiking, skiing and other outdoor sports.)

The opposition was brought by the registrant of an earlier composite mark which also contained the word "Alpine".

The court agreed with the OHIM Board of Appeal that the word "Alpine" was the dominant element of both marks even though that word had a low level of distinctiveness, and it considered that the marks were similar visually, phonetically and conceptually. It also held that many of the respective goods were identical and the rest were similar, to varying degrees. The court identified a particular section of the public, consumers of skiwear, as being more informed and attentive than the general consumer of goods, but this did not prevent it from concluding that there was a likelihood of confusion between the two marks on the part of the relevant public as a whole.

Nike International Ltd's appeal to oppose registration of the word mark R10 as a CTM

OHIM v Nike International, Case C-53/11 P, 19 January 2012 target=blank>

The ECJ has upheld an OHIM ruling that an appeal by Nike International Ltd seeking to oppose registration of the word mark R10 as a Community trade mark was inadmissible. The opposition was based on the earlier mark R10, which Nike had acquired towards the end of the opposition proceedings. Nike applied to substitute itself as the opponent, but it did so after the opposition had been rejected on grounds of non-use of the earlier mark. OHIM ruled that Nike did not have standing to appeal the opposition decision because it had not proven within the requisite time period that it was the new owner of the earlier mark. The EU General Court upheld Nike's appeal against OHIM's decision, concluding that Nike should have been given extra time in which to file the necessary evidence. However, the ECJ reversed the EU General Court's decision, saying that Nike had failed to adduce sufficient evidence of its standing within the requisite four-month period. Rule 49 of Regulation 2868/95 required rejection of appeals whose deficiencies had not been remedied within applicable deadlines. Accordingly, the ECJ said that it was obliged to set aside the General Court's decision and refer the case back to it.

Consultation concerning changes to copyright law

The Intellectual Property Office (IPO) has published a consultation paper detailing substantial changes it proposes to make to copyright law in order to make it fit for purpose for the digital age and implement the recommendations made in the Hargreaves review. The consultation seeks evidence on the potential for the proposed measures to improve the contribution of the copyright system to UK economic growth, and to inform decisions on legislative and other actions in these areas. The proposed measures relate to licensing, new exceptions to copyright, the digitisation of works and parody.

Annual progress report on the Digital Agenda for Europe documents/dae_annual_report_2011.pdf

The European Commission has published a progress report on the Digital Agenda for Europe which sets out key items for action in 2012, including legislative plans relating to collective-rights management, online distribution of audio-visual works, enforcement of intellectual property rights, licensing of orphan works and data protection.

A call for evidence on simplification of the UK designs system

IPO press release, 19 December 2011

Following the Hargreaves report, the Intellectual Property Office (IPO) has issued a preliminary assessment on the need to simplify the UK designs system. Professor Ian Hargreaves recommended that the IPO should conduct an evidence-based assessment of the relationship between design rights and innovation. This preliminary assessment sets out the current state of the IPO's research. Comments are invited.

Nominet proposes changes to registration rules for and domain Names

Nominet press release, 20 December 2011

Nominet is proposing changes to the rules of registration for and domain names. Since it is possible for more than one company to be entitled to the same domain name (characters which cannot be represented in the internet domain name system (DNS), such as "&" or "@" are ignored), Nominet is proposing to amend the rules to align them with the procedure used by Companies House to determine if a proposed company name is the same as one already on the Companies Register. In future, any characters that cannot be used in the DNS will be converted to text rather than being deleted.

ICANN takes applications for new generic top-level domain names (gTLDs)

ICANN announcement, 19 September 2011

ICANN announcement, 6 January 2012

From 12 January 2012, ICANN began taking applications for new generic top-level domain names (gTLDs). Applicants may select their own domain names which is likely to increase the number of gTLDs from the current 22 available. It will cost $185,000 to apply for the suffixes and applicants will need to meet high technical standards and show a legitimate claim to the domain. Applications for new gTLDs will be accepted until 12 April 2012. The ICANN microsite provides more information (see links above).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Charles Russell's Intellectual Property Group
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