DLP Ltd, Re UK Intellectual Property Office Decision

This is the first appeal before this court under the new scheme for “Comptroller’s opinions”. It raises two important issues:

On 19 July 2006, the appellant (“DLP”) sought an opinion from the Comptroller under section 74A of the Patents Act 1977 (“the Act”) as to whether a shower tray made and sold by a third party, Scrabo Bathing Care (“Scrabo”), infringed its UK patent number 2,394,175B (“the patent”). On 20 October 2006, and in accordance with the statutory scheme, the examiner issued an opinion that the Scrabo shower tray did not infringe the patent. DLP requested a review of the opinion which was duly issued by Mr Walker, the Hearing Officer acting for the Comptroller, on 26 April 2007. The Hearing Officer ordered certain parts of the original opinion to be set aside but found no fault with its overall conclusion. DLP now appeals to this court against that decision. The appeal is brought under section 74B of the Act and the rules made under that section.

A preliminary hearing of the appeal took place before Pumfrey J on 18 October 2007. In the course of that hearing an important feature of the procedure was canvassed, namely that it can only ever result in opinions or decisions on review which are non binding. I understand this led the learned judge to express reservations as to whether this court should entertain the appeal for essentially two reasons: first, whether the review by the Hearing Officer is a decision against which there is a right of appeal; second, whether the appeal is of a type with which the court should, in any event, refuse to deal. Accordingly, he directed that these issues should be addressed by both the Comptroller and DLP at the substantive hearing. As a result, I have had the benefit of submissions upon them by Mr Tappin on behalf of the Comptroller, and Mr Hacon on behalf of DLP.

The framework of the opinion system was created by sections 74A and 74B of the Act which were introduced by section 13 of the Patents Act 2004.

Section 74A deals with opinions and reads:

“(1)

The proprietor of a patent or any other person may request the comptroller to issue an opinion-

(a)

as to whether a particular act constitutes, or (if done) would constitute, an infringement of the patent;

(b)

as to whether, or to what extent, the invention in question is not patentable because the condition in section 1(1)(a) or (b) above is not satisfied.

(2)

Subsection (1) above applies even if the patent has expired or has been surrendered.

(3)

The comptroller shall issue an opinion if requested to do so under subsection (1) above, but shall not do so-

(a)

in such circumstances as may be prescribed, or

(b)

if for any reason he considers it inappropriate in all the circumstances to do so.

(4)

An opinion under this section shall not be binding for any purposes.

(5)

An opinion under this section shall be prepared by an examiner.

(6)

In relation to a decision of the comptroller whether to issue an opinion under this section-

(a)

for the purposes of section 101 below, only the person making the request under subsection (1) above shall be regarded as a party to a proceeding before the comptroller; and

(b)

no appeal shall lie at the instance of any other person.”

Section 74B allows rules to make provision for a review procedure and for there to be a right of appeal against a decision made on a review in prescribed cases. It reads:

“(1)

Rules may make provision for a review before the comptroller, on an application by the proprietor or an exclusive licensee of the patent in question, of an opinion under section 74A above.

(2)

The rules may, in particular-

(a)

prescribe the circumstances in which, and the period within which, an application may be made;

(b)

provide that, in prescribed circumstances, proceedings for a review may not be brought or continued where other proceedings have been brought;

(c)

make provision under which, in prescribed circumstances, proceedings on a review are to be treated for prescribed purposes as if they were proceedings under section 61(1)(c) or (e), 71(1) or 72(1)(a) above;

(d)

provide for there to be a right of appeal against a decision made on a review only in prescribed cases.”

The relevant rules (rules 77A-K Patents Rules 1995) came into force on 1 October 2005. They provide details of the application process, the right of review and the right of appeal against the review decision.

The opinion procedure is set forth in rules 77B-G. The scheme is relatively straightforward and I can summarise the material aspects of it quite shortly. Any person may request the Comptroller to issue an opinion as to whether a particular act constitutes an infringement or as to whether an invention is patentable. The procedure begins with a request setting out the question upon which an opinion is sought, the requester’s submissions on that question and any matters of fact which are requested to be taken into account. The requester must provide details of any persons having an interest in the question and of any proceedings of which the requester is aware which relate to the patent and which may be relevant to the question. The Comptroller then advertises and notifies interested parties of the request. Any person may, but is not required to, file observations on any issue raised by the request. The Comptroller then refers the request to an examiner for the preparation of the opinion and the Comptroller issues the opinion by sending a copy to the requester, the patent holder and any other person who has filed observations. Appropriate particulars are entered on the register throughout.

Importantly, the opinion is not binding for all purposes (section 74(A)(4)). The aim of the scheme was explained in a consultation paper issued by the Patent Office (as it then was) before the rules were finalised. In short, it is intended to provide a low cost service which helps to resolve patent disputes, and so encourages innovation, by providing a quick, balanced and affordable way for parties to get an impartial assessment of key infringement and validity issues. The Comptroller aims to provide a reasoned opinion and express a firm view, rather than trying to assess the likelihood of invalidity or infringement in percentage terms. It was also noted that the opinion can only be as good as the material submitted allows. However, it was hoped that an opinion might assist the parties to focus their minds on the key issues, test and understand the strength of their cases and so better enable them to negotiate a settlement rather than engaging in litigation.

The rules relating to the review process read:

“Review of opinion

77H.-(1) The patent holder may, before the end of the period of three months beginning with the date on which the opinion is issued, apply to the comptroller for a review of the opinion.

(2)

However, such proceedings for a review may not be brought (or if brought may not be continued) if the issue raised by the review has been decided in other proceedings.

(3)

The application shall be made on Patents Form 2/77, and shall be accompanied by a copy and a statement in duplicate setting out fully the grounds on which the review is sought.

(4)

The statement shall contain particulars of any proceedings of which the applicant is aware which may be relevant to the question whether the proceedings for a review may be brought or continued.

(5)

The application may be made on the following grounds only-

(a)

that the opinion wrongly concluded that the patent was invalid, or was invalid to a limited extent; or

(b)

that, by reason of its interpretation of the specification of the patent, the opinion wrongly concluded that a particular act did not or would not constitute an infringement of the patent.

Procedure on review

77I.-(1) Upon receipt of the application, the comptroller shall send a copy of the form and a statement filed under rule 77H-

(a)

to the requester (if different from the applicant); and

(b)

to all persons who filed observations under rule 77F.

(2)

The comptroller shall advertise the application in such a manner as he may think fit.

(3)

Before the end of the relevant period, any person may file a statement in support of the application or a counter-statement contesting it (which in either case must be in duplicate), and on so doing shall become a party to the proceedings.

(4)

The relevant period is the later to end of the following periods-

(a)

the period of four weeks beginning with the date that the application is advertised under paragraph (2);

(b)

the period of two months beginning with the date on which the opinion is issued under rule 77G(2).

(5)

The comptroller shall send to the other parties a copy of each statement or counter-statement filed under paragraph (3).

(6)

The comptroller may give such directions as he thinks fit with regard to the subsequent procedure.

Outcome of review

77J.-(1) Upon the completion of the proceedings under rule 77I the comptroller shall either-

(a)

set aside the opinion in whole or in part; or

(b)

decide that no reason has been shown for the opinion to be set aside.

(2)

A decision under paragraph (1)(a) or (b) shall not estop any party to proceedings from raising any issue regarding the validity or the infringement of the patent. ”

It is apparent that only the “patent holder” (the proprietor of the patent and any exclusive licensee) may apply to the Comptroller for a review of the opinion. The thinking behind this limitation was that any party named in an opinion must have a right to challenge the opinion if it is adverse to him. Where a third party has requested an opinion then this can be achieved by launching full proceedings. If he dislikes an opinion that the patent is wholly or partially valid then he may apply for revocation. If he dislikes an opinion that a particular act infringes the patent then he may apply for a declaration of non-infringement. However, it was considered that a patent holder faced with an adverse opinion may not have the same opportunity. The reason is explained in paragraphs 33 to 34 of the consultation paper:

“The patent holder may apply to have an adverse opinion set aside, and this would include an opinion which suggested that the patent was only partially valid. It is important to provide this opportunity since – in the absence of a third party launching revocation proceedings or committing an allegedly infringing act – the patent holder may have no other way of tackling an adverse opinion on validity that he feels is wrong.

The patent holder may also apply to have an adverse opinion on infringement set aside, but only where the opinion has come to that adverse view as a result of (what the patent holder believes is) an erroneous construction of the patent specification. Generally speaking, if the opinion has concluded that no infringement is taking place and the patent holder disagrees, he may sue for infringement. This could include the circumstances where the patent holder disagrees with the way that the claims have been construed. But suing for infringement is not possible if the opinion was sought on a potential or hypothetical act, and in such circumstances it would be unfair to deny the patent holder a chance to overturn an infringement opinion based on a construction of the claim which is adverse to him. Thus it is proposed to allow a review of an infringement opinion where the sole issue at stake is the construction of the claims.”

Mr Tappin explained that in proposing a review and appeal procedure, the Patent Office was influenced by considerations relating to Art.1 of the First Protocol to the ECHR. It was considered that a patent holder faced with an adverse opinion ought always to have an opportunity to have the opinion reviewed. Accordingly the rules permit a patent holder to apply for a review on the grounds that the opinion wrongly concluded that the patent was invalid, or was invalid to a limited extent and also on the grounds that, by reason of its interpretation of the specification of the patent, the opinion wrongly concluded that a particular act did not or would not constitute an infringement of the patent.

Upon receipt of an application for a review, the Comptroller notifies all interested parties and advertises the application. Any interested party may, but is not required to, contest the application. If he does so then he becomes a party to the proceedings. Finally, a decision is issued which must either set aside the opinion in whole or in part, or conclude that no reason has been shown for the opinion to be set aside.

Once again, the decision is not binding – it does not estop any party to proceedings from raising any issue regarding the validity or the infringement of the patent (rule 77J(2)).

Rule 77K addresses appeals against a decision on review:

“No appeal under section 97 shall lie from decision to set aside the opinion under rule 77J(1)(a), except where the appeal relates to a part of the opinion that is not set aside. ”

This rule gives a limited right of appeal against a decision on review. No permission is required. But an appeal lies only against a decision which upholds an opinion either wholly or in part. It follows that it is a right afforded only to a patent holder. The rationale for this limited right of appeal is explained in paragraph 42 of the consultation paper:

“Under section 74B(2)(d), the right to appeal a decision on a review may be limited to prescribed cases. If an opinion adverse to the patent holder is set aside on review, it would be disproportionate for the original requester (or anyone else) to be able to appeal that decision, and have the court consider in full proceedings whether to reinstate a non-binding opinion. Such a person will in any event be able to have the issues determined by a court by bringing revocation proceedings or proceedings for a declaration of non-infringement, Thus rule 78K [now rule 77K] does not allow for such appeals. Under that rule, a review decision will only be appealable if it upholds an opinion either wholly or in part. In other words, if after a review an opinion adverse to the patent holder remains, the patent holder will be entitled to appeal.”

Mr Tappin provided me with some statistics which show that the opinion service has generally been a success so far. It began on 1 October 2005 with an opinion fee of £200 and a review fee of £50. As of 19 October 2007, 57 requests for opinions had been received. Of these, opinions had been issued in 45 cases, 3 requests had been refused, 3 requests had been withdrawn and 6 were pending. The 45 issued opinions had resulted in 13 requests for reviews (one of which had been withdrawn); 8 review decisions had been issued and 4 were still pending. It seems that of the 8 review decisions, 2 have been appealed - including this case.

It is convenient at this point to address the questions raised by Pumfrey J at the hearing on 18 October 2007. The first is whether there has been a decision against which there is a right of appeal. Both Mr Tappin and Mr Hacon submitted that the answer to this question is yes. I agree. The Hearing Officer, on behalf of the Comptroller, decided that no reason had been shown for the overall conclusion of the examiner to be set aside. By virtue of section 97 of the Act, an appeal lies to this court from any decision of the Comptroller under the Act or rules, subject to certain exceptions. The instant appeal is not excluded by any of the provisions referred to in section 97. Nor is it excluded by rule 77K. In my judgment, it was manifestly the intention of section 74B and rule 77K that an appeal should lie as of right where it relates to a part of an opinion that is not set aside. This is just such a case.

The second is whether this appeal is of a type with which the court should refuse to deal because it is an inherent feature of the procedure that it can only result in the production of non binding opinions or decisions. In the course of the preliminary hearing, Pumfrey J referred to the decision of the House of Lords in Sun Life Assurance Company of Canada v Jervis [1944] AC 111. In that case their Lordships declined to hear an appeal since there was no longer any issue to be decided between the parties. Viscount Simon L.C. said at 113:

“My Lords, in my opinion, the House should decline to hear this appeal on the ground that there is no issue before us to be decided between the parties. The difficulty is that the terms put on the appellants by the Court of Appeal are such as to make it a matter of complete indifference to the respondent whether the appellants win or lose. The respondent will be in exactly the same position in either case. He has nothing to fight for, because he has already got everything that he can possibly get, however the appeal turns out, and cannot be deprived of it. I do not think that it would be a proper exercise of the authority which this House possesses to hear appeals if it occupies time in this case in deciding an academic question, the answer to which cannot affect the respondent in any way. If the House undertook to do so, it would not be deciding an existing lis between the parties who are before it, but would merely be expressing its view on a legal conundrum which the appellants hope to get decided in their favour without in any way affecting the position between the parties.”

And at 114:

“The research which has been given to the matter does not discover any previous decision in which the House of Lords has undertaken, on the petition of an unsuccessful appellant, to review the decision below when the opposite party has been finally settled with, and I think it is an essential quality of an appeal fit to be disposed of by this House that there should exist between the parties a matter in actual controversy which the House undertakes to decide as a living issue.”

In my judgment the principles explained by the House of Lords in Sun Life do not lead to the conclusion that this court should decline to entertain appeals of the kind now before me. The Act and the rules provide a regime for the provision of non binding opinions which are potentially of great value to all persons concerned with the validity or infringement of a patent. They also expressly provide for an application by the patent holder for a review of an unfavourable opinion and for an appeal as of right against an unfavourable decision on such a review. Such an appeal does not involve an academic question. To the contrary, it involves a living issue, namely whether the opinion to which the patent holder is entitled reached the wrong conclusion. I believe it would be wrong for this court to decline to exercise the jurisdiction which the Act and the rules have conferred.

What then is the nature of the appeal to this court? Pursuant to CPR 52.11 it must in general be limited to a review of the decision of the Hearing Officer. The nature of this exercise is explained by May LJ in Du Pont Trade Mark [2003] EWCA Civ 1368 at 94:

“As the terms of r.52.11(1) make clear, subject to exceptions, every appeal is limited to a review of the decision of the lower court. A review here is not to be equated with judicial review. It is closely akin to, although not conceptually identical with, the scope of an appeal to the Court of Appeal under the former Rules of the Supreme Court. The review will engage the merits of the appeal. It will accord appropriate respect to the decision of the lower court. Appropriate respect will be tempered by the nature of the lower court and its decision making process. There will also be a spectrum of appropriate respect depending on the nature of the decision of the lower court which is challenged. At one end of the spectrum will be decisions of primary fact reached after an evaluation of oral evidence where credibility is in issue and purely discretionary decisions. Further along the spectrum will be multi-factorial decisions often dependent on inferences and an analysis of documentary material.”

In the case of an appeal under rule 77K, the decision the subject of the appeal is itself a review of the opinion of the examiner. More specifically, it is a decision by the Hearing Officer as to whether or not the opinion of the examiner was wrong. I believe that a Hearing Officer, on review, and this court, on appeal, should be sensitive to the nature of this starting point. It was only an expression of an opinion, and one almost certainly reached on incomplete information. Upon considering any particular request, two different examiners may quite reasonably have different opinions. So also, there well may be opinions with which a Hearing Officer or a court would not agree but which cannot be characterised as wrong. Such opinions merely represent different views within a range within which reasonable people can differ. For these reasons I believe a Hearing Officer should only decide an opinion was wrong if the examiner has made an error of principle or reached a conclusion that is clearly wrong. Likewise, on appeal, this court should only reverse a decision of a Hearing Officer if he failed to recognise such an error or wrong conclusion in the opinion and so declined to set it aside. Of course this court must give a reasoned decision in relation to the grounds of appeal but I think it is undesirable to go further. It is not the function of this court (nor is it that of the Hearing Officer) to express an opinion on the question the subject of the original request.

Pursuant to paragraph 17.6 of the Practice Direction to Part 52 CPR the Comptroller is entitled to attend any appeal to this court from one of his decisions. As a matter of practice, he treats ex parte and inter partes cases differently.

In ex parte cases, a decision is made by an examiner and thereafter the Comptroller gives the applicant (if he wishes) the opportunity to have a decision made by a Hearing Officer at a formal hearing. The examiner generally attends at the hearing and participates to ensure the relevant points are covered and often to explain his reasoning. In inter partes cases two contesting parties attend before the Hearing Officer and a decision is made. There is no role for an examiner and there is no kind of prior informal decision.

It is the policy of the Comptroller to appear before this court on appeals from ex parte decisions. Whether properly characterised as a respondent or not, he is often named as such and, in the event the appeal is dismissed, will generally seek an order for costs. By contrast, it is not the policy of the Comptroller to appear on appeals from inter partes decisions unless invited to appear to assist the court in relation to an important issue or to advance submissions on behalf of a party who has dropped out of the proceedings.

The Comptroller proposes to treat appeals of the kind before me as inter partes appeals and not to appear as a matter of course. In my judgment this approach is entirely reasonable. I see no reason why the Comptroller should be required to participate in all such appeals, particularly since the examiner played no part in the procedure on review. Further, and importantly, it would tend to frustrate the whole object of the opinion system which is to provide a quick, cheap and simple means to obtain a view from a respected and experienced source as to the validity or infringement of a patent.

The invention relates to shower trays and particularly to low level shower trays which can readily be accessed by infirm or disabled people while seated in a wheelchair.

The patent describes various systems which formed part of the state of the art. One, known as the wet floor former, involved locating the shower tray below the floor surface which was covered with a waterproof covering extending over the edges of the shower tray. In another, the shower tray was located above the floor surface with ramps providing access to the user of a wheelchair. In yet another, the shower tray was located primarily within the floor but with a raised rim, typically no more than 2-5mm in height, under which the floor covering was located and sealed and over which the wheelchair user could manoeuvre.

Against this background, the patent explains the invention seeks to provide a shower tray which provides the access and positioning benefits of a wet floor former whilst also allowing installation of the shower tray either above or below the floor surface. Claim 1 reads:

“A shower tray comprising a trough along one or more sides of the tray and means for clamping flexible floor covering material and/or a flexible edge of a ramp device in the trough (s).”

The benefit of the shower tray of the invention is described in the following paragraph on page 13 of the specification:

“The shower tray described above can thus be installed into one of a plurality of different installation configurations equivalent to a wet floor former, a low level shower tray and a surface mounted shower tray. The particular configuration can be selected by the installer at the time of installation. Surrounding flooring material and/or an access ramp may be inserted and retained by the clamping and sealing device arrangement located within the tray periphery. The peripheral trough feature within the shower tray allows the installer a wide margin of error in the trimming of the floor covering material while still achieving an effective water seal and floor covering clamping mechanism.”

DLP accepted that the Scrabo tray, in the form purchased from a plumber’s merchant or other supplier, does not comprise a trough. Rather, it has a lip extending horizontally from the bottom section of two of its sides. However, when the Scrabo tray is installed, a trough is formed by the vertical edge of the tray, the upper surface of the lip and either the cut away section of the floor (if set into the floor) or the wall of the ramp (if installed on the floor surface) which it abuts.

DLP recognised there could be no infringement under section 60(1) of the Act by the manufacture of the Scrabo tray because it does not, at that stage, comprise a trough. However, DLP argued that it does comprise a trough upon installation. Hence the supply of the Scrabo tray would constitute the supply of means, relating to an essential element of the invention, for putting the invention into effect and the person supplied with the tray would know, or it would be obvious to a reasonable person in the circumstances, that the tray was suitable for putting, and was intended to put the invention into effect. The supply of the tray would therefore infringe under section 60(2) of the Act.

In his opinion, the examiner set out the background and then directed himself as to the law. He properly referred to section 125 of the Act as defining the extent of an invention and correctly identified the decision of the House of Lords in Kirin-Amgen Inc v Hoechst Marion Roussel [2005] RPC 9 as the leading authority in this jurisdiction on the question of interpretation. With the principles explained in that case in mind, he turned to consider what the patentee meant by the words “a shower tray comprising a trough along one or more sides of the tray…”. He observed that “comprising” conventionally means “including” in patent claims and considered the patent drawings and description to be consistent with this interpretation. In this regard he specifically relied upon the passage appearing on page 13 of the specification which I have set out in paragraph [30] above. It was his opinion that the claim required one or more sides of the tray to include a trough. Moreover, he considered the patentee intended the trough to be formed from the material of the tray or as an integral part of it.

The examiner then turned to consider the Scrabo tray and agreed with DLP that, when the tray was installed, a trough was inevitably formed between the vertical edge of the floor, the wall of the tray body and the upper surface of the lip. However, having construed the claim in the way that he had, he was unable to agree that it included the composite arrangement of the tray and the edge of the floor within its scope. He was satisfied that the formation of a trough between the upright wall of the tray and the upright edge of the floor fell outside the scope of the claim.

Upon reviewing the opinion of the examiner, the Hearing Officer found that he had interpreted claim 1 too narrowly by requiring the trough to be an integral part of the tray and formed from the material of the tray itself. Nevertheless, he agreed with the interpretation given in the opinion that the shower tray must itself include a trough on one or more of its sides. Indeed, on this point he went still further and expressed the view that the trough must be in place at the time and place of supply. Accordingly, and while he was not able fully to accept the examiner’s interpretation of the specification, he could not fault the overall conclusion that the patent would not be infringed by the supply of the Scrabo tray in the United Kingdom.

On appeal, Mr Hacon advanced a number of criticisms of various aspects of the detailed reasoning of the original opinion and in the review decision. I have considerable sympathy with a number of those criticisms, particularly as to the suggestion by the examiner that the trough must be integral with or formed of the material of the tray and as to the view of the Hearing Officer that the claim requires the trough to be in place at the time and place of supply. But at the end of the day, for this appeal to succeed, it must be shown that the core reasoning they each contain is clearly wrong.

That core reasoning is that claim 1, on its proper interpretation, requires the shower tray itself to include a trough and that although a trough is undoubtedly formed by a combination of a Scrabo tray and the flooring upon its installation, it cannot be said, even then, that the trough is part of the tray.

Mr Hacon submitted that in the present case the language of the claim merely requires the presence of a trough along one or more sides of the tray. The trough need not be attached to the tray at all; far less does it need to be attached at any particular time in the tray’s existence. It followed that, once installed, the Scrabo tray has a trough along one of its sides and that, with the trough, the tray falls within claim 1.

It can be seen that these submissions have at their heart the ordinary meaning of the words of claim 1. Both the examiner and the Hearing Officer considered the skilled person would understand the words of claim 1 to mean the shower tray must itself include a trough. They directed themselves correctly in law and considered the claim in the light of the specification and through the eyes of the skilled person. It was not an opinion which was clearly wrong. Indeed, I think it was a reasonable view for them to take. This appeal must be dismissed.