Would a “could” suffice?

Comparing EPO and French case law on validity is one of this blog’s favorite topics.

Today’s post will be dedicated to a cornerstone of the EPO doctrine: the could/would approach in the inventive step reasoning.

The could/would approach was actually nicely summarized by the Paris Cour d’appel in a Sandoz v. Eli Lilly decision (January 13, 2012), making explicit reference to the European case law book that all European patent attorneys have on one of their shelves:

As can be derived from established case law of the Boards of appeal of the EPO, the question is not whether the skilled person could have made the invention by modifying the state of the art, but whether he would have done so in the hope of achieving the advantages that were really obtained in the light of the technical problem at stake, because the state of the art contained suggestions in this respect. 

So far so good, and all supporters of pan-European harmonization must be satisfied.

Not so fast, though, as some recent decisions seem to show that the could/would approach is not as inscribed in the DNA of French IP courts as it is in the EPO’s DNA. Here is an example. 

Modelabs Mobiles is a French company which distributes mobile phones and other IT devices. Modelabs Mobiles filed a French patent application No. FR 3063299 on February 24, 2017, directed to a casing for locking and immobilizing a phone.

Just after the publication of the application, Modelabs Mobiles proceeded with an infringement seizure against its competitor Wiko, on October 23, 2018, and soon thereafter filed an infringement suit, based on the FR’299 application (yes, this is possible before the grant of the patent under French law).

The patent was granted on April 12, 2019. On June 7, 2019, Modelabs filed a claim for preliminary injunction with the judge in charge of case management, and further requested a provisional damages award of more than 2 million euros. Modelabs argued that the existence of infringement acts was likely, and that since the defendant was in a restructuring process, there was a risk that damages could not be recovered.

The judge in charge of case management ruled on September 13, looking first at whether the patent was apparently valid.

Here is claim 1 of the patent:

Casing, in particular intended to contain a telephone, comprising:

– a first shell and a second shell that close onto one another so as to close the casing by rendering its contents inaccessible,

– a slide that is movable in translation on the first shell, comprising at least one coupling member, and which can be actuated from outside the closed casing so as to be positioned by translation in a first, a second or a third positions, wherein the first shell, the second shell and the coupling member(s) are arranged so that, when the casing is closed:

– at least one coupling member is coupled to the second shell when the slide is in the first position, thus opposing the opening of the casing,

– at least one coupling member is coupled to the second shell when the slide is in the second position, thus opposing the opening of the casing,

– the coupling member(s) is/are free when the slide is in the third position, thus allowing the opening of the casing, the casing further comprising:

– a device for locking the slide on one of the shells in the first position, actuable only by means of a dedicated tool from the outside of the casing when this casing is closed,

– first means for reversible immobilization of the slider in the second position,

– second means for reversible immobilization of the slider in the third position.

In summary, this casing can be used for protecting a phone in a store. The casing has three configurations: one which is fully locked, and which requires a tool (e.g. a magnetic one) to be unlocked; one which is unlocked and closed; and one which is unlocked and open. The transitioning between the unlocked / closed and unlocked / open positions can be performed without using an external tool.

Locked – unlocked

Wiko relied on three prior art documents against the novelty and inventive step of the main claim. The judge found that the claim was novel.

Regarding in particular the so-called EP’090 prior art reference, the judge held:

[…] The “movable member” which can correspond to the “slide” of the invention of the patent can be positioned in two different positions, and not three. In order to ensure an anti-theft function, a safety device must be added, comprising an “inserted” external element whereas, in the casing claimed by Modelabs, the safety device is fully part of said casing even if it requires the use of an external tool to be deactivated. 

A similar conclusion was reached regarding the two other prior art references.

However, regarding inventive step, the judge made the following comments:

In view of the state of the art […], the skilled person already knew casings for products on sale, having an integrated locking system, which can be actuated by a dedicated external tool such as a magnetic tool, preventing access to the content of the casing in the absence of said tool without breaking the packaging itself. 

Admittedly, the casing at stake, relative to [this prior art], provides an intermediate position in addition to the mere locked/unlocked alternative. but this mode of using the casing (simply closed in a reversible manner) does not address the technical problem that the invention purported to solve, which was to make the content of the casing safer. 

Besides, it can be legitimately questioned whether the skilled person requires a particular inventive step in adding an intermediate position between the locked/unlocked positions for the coupling member supported by the slide […], in order to keep the casing closed in a reversible manner (thus that can be manually actuated, without a dedicated tool), in view of the state of the art. Indeed, the addition of such an intermediate position prima facie seems to rather logically derive from [the prior art]. 

Therefore, the prior art submitted as a defense provides a serious possible ground for nullity [of the patent]. 

As you can see, the judge does not seem to reason in terms of what the skilled person would have done, but rather in terms of what he or she could have done.

Indeed, although there does not seem to be any suggestion or motivation in the prior art to have this intermediate closed/unlocked position for the slide, as far as I can tell from the judgment, the judge nevertheless concluded that it would have been “logical” for the skilled person to include such an additional position.

By way of comparison, here is the position taken by the EPO examiner in charge of the search report for the French application (based on different, but presumably similar prior art):

Such a casing with three positions for the slide and “reversible immobilization means” […] is completely unknown in the state of the art. Hints pointing to this direction are also absent. 

So, what can we make of this? One interpretation of course is that the inventive step threshold is higher in France than at the EPO. This is of course very possible. Another interpretation is that the judge had questions or doubts and simply did not want to grant a preliminary injunction and preferred to let the case continue on the merits.

That said, my attention was also drawn by the following statement:

Modelabs did not provide any argumentation regarding the inventive step of its patent which differs from the novelty argumentation. 

As always, we should keep in mind that, in view of our rules of civil procedure, and based on a longstanding tradition, French judges limit the scope of their decisions to the arguments put forward by the parties. Therefore, in the absence of any reference in the patentee’s submissions to the could/would approach, it is unsurprising that the judge did not use this reasoning.

Thus, I could say (or make that rather: I would say), that argumentation in French patent litigation has to be complete, including explanations on the legal standards to be applied – or else… 

As a next step, if the case continues on the merits, we will see whether the three-judge panel of the court uses the same or a different approach.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 3ème section, ordonnance du juge de la mise en état, September 13, 2019, SAS Modelabs Mobiles v. SAS Wiko, RG No. 18/13517.

No way back

There once were submarine patents, living a quiet and inconspicuous life underwater, only to surface one day with a resounding splash.

Turns out what we do sometimes have in France is submarine patent cases. A recent ruling by the Lyon Cour d’appel could be considered as one of those.

In fact, Paris has exclusive jurisdiction over patent matters since November 1, 2009. Thus, I was more or less convinced I would never see again a patent revoked in a provincial court – but I was wrong.

Chavanoz Industrie, proprietor of European patent No. EP 0900294, filed an infringement suit against Mermet SAS in 2009, a couple of months before the November 1 date, and thus in Lyon. The first instance judgment was issued in September 2016.

I assume that the main reason why this lingered for such a long time is that the defendant merged in 2011, and then underwent insolvency proceedings in 2012. In 2013, a so-called continuation plan was ordered.

At any rate, the Lyon TGI hit late, but it hit hard, as the patent was held valid and infringed, and a damages award amounting to a total of more than 25 million euros was issued.

However, the ruling was fully overturned on appeal, a few weeks ago, as the Cour d’appel had a different appreciation of a key aspect of the case from the TGI.

The patent at stake was filed on April 16, 1997, claiming a French priority of May 7, 1996. It was granted in 1999 and limited by the French patent office (INPI)… in 2017, just a few days before it expired. Unusual enough, but wait until you read about the rest of the case.

Claim 1 of the patent as limited reads as follows:

Composite yarn for making a technical fabric for an awning, said yarn comprising a core composed of a continuous yarn made of glass, and a coated sheath composed of a matrix consisting of at least one chlorinated polymer material, for example a polyvinyl chloride or PVC, and a fire-retarding filler incorporated into and distributed within the said matrix, characterized in that, in combination, on the one hand the fire-retarding filler comprises a ternary composition which combines an oxygenated antimony compound, for example antimony trioxide, a hydrated metal oxide, the metal of which is chosen from the group consisting of aluminium, magnesium, tin, zinc and lead, for example an alumina hydrate, and a zinc borate and, on the other hand, together with the said ternary composition, the total weight content of inorganic matter in the yarn is between 4% and 65%.

The alleged infringer asserted that the invention had been made available to the public before the priority date of May 7, 1996, because the patent proprietor Chavanoz had supplied the patented yarn to (among others) a third party, Helioscreen.

Chavanoz responded by relying on a confidentiality agreement signed with Helioscreen on April 9, 1996.

The court had to deal with three thorny issues:

  • Chavanoz stated that most of Mermet’s exhibits relating to the alleged public prior use were illegally obtained, in view of the confidentiality agreement, and that they should thus be disregarded by the court.
  • Then there was the question of whether the supply of the yarn in question was indeed a public disclosure or whether it was confidential.
  • Then there was the question of whether the skilled person would have been able to arrive at the claimed invention by analyzing the supplied yarn, at the priority date.

First things first, the fate of the exhibits.

In support of the public prior use allegation, the infringement defendant filed a number of documents, such as invoices, orders, letters, between the patent proprietor and the third party Helioscreen. These documents were, as far as I understand, willingly provided by Helioscreen. Chavanoz protested that this was in breach of the Chavanoz-Helioscreen confidentiality agreement of April 9, 1996.

The first instance judges agreed and thus discarded the evidence. But the appeal judges came to a different conclusion.

The 1996 confidentiality agreement recites that the parties have been cooperating since May 9, 1994 in the business of technical fabric. Helioscreen provided specifications, Chavanoz made yarn and supplied it to Helioscreen, together with some technical information, Helioscreen made fabric with this yarn and supplied samples of said fabric to Chavanoz for testing. The agreement then basically states that all information, documentation, products exchanged between the parties is confidential, and that the agreement itself is confidential. The agreement also mentions that it is retroactive back to May 9, 1994 and that it will remain in force as long as all of the confidential information has not been made available to the public.

The appeal judges held that the confidentiality agreement expired in November 1997, when the patent application was published. Therefore, Helioscreen was free to provide any documents and information to Mermet. Besides, Mermet was anyway not bound by the confidentiality agreement and was free to provide any material obtained from Helioscreen in order to build its defense. In fact, Helioscreen was not sued by Chavanoz for breach of the confidentiality agreement.

As a result, all of the exhibits filed by Mermet were deemed admissible.

I am not necessarily convinced by the argument that the confidentiality agreement expired when the patent application was published. Indeed, the information exchanged by the parties could possibly extend beyond the contents of the patent application. Notwithstanding, it seems only fair that Mermet, as a third party to the agreement, should be allowed to rely on whatever evidence is at its disposal as a defense in the infringement suit.

This brings us to the second point, namely whether the exchanges between Chavanoz and Helioscreen were confidential or not.

The court analyzed in detail the evidence at hand, and concluded that several dozens of tons of so-called M1B1 yarn were sold by Chavanoz to Helioscreen before the priority date of May 7, 1996. The yarn was first experimented in 1992, but by 1995, the production of the yarn was on an industrial scale. The court further noted that there is no evidence that the formulation of the yarn changed as from 1995-1996, or that the product was still in development – even though further yarn colors were later designed.

Besides, the M1B1 yarn was also supplied to other fabric manufacturers, including Mermet itself and another company called Brochier, in the context of the professional association ScreenGlass, in order for all manufacturers to provide feedback on the yarn.

The court also established that the fabric made by Helioscreen from the M1B1 yarn was sold to various clients before May 7, 1996.

No written confidentiality agreement was in place when all these exchanges took place; in particular, no exhibit on file bears the mention “confidential“.

The court then stated that “there is never a presumption of confidentiality in the context of a relationship with a buyer“.

Next, the appeal judges turned to the confidentiality agreement of April 9, 1996, which, as a reminder, states that all prior exchanges with Helioscreen were confidential. The court was unimpressed by this statement:

The reality of the amounts supplied to Helioscreen and the reality of the industrialization phase emphasized by Chavanoz Industrie itself in its commercial correspondence are never mentioned [in the agreement]. The content of the deliveries that are mentioned only relates to “samples”. 

[…]

It is thus important to determine if a company that has already disclosed its invention to a partner not subjected to an obligation of confidentiality at the time of the disclosure can erase the existence of this disclosure, which may be novelty-destroying, by signing a confidentiality agreement after the facts. 

The public policy provisions of patent law prevent parties to an agreement, from depriving a disclosure which has already occurred of legal effect, even with a retroactive effect.  

An invention is made available to the public when it is disclosed to a person not bound by confidentiality at the time of the disclosure, so that the retroactive provision in the above confidentiality agreement has here no effect on the appraisal of the validity of the patent. 

Is it possible to go back to the pre-disclosure situation?

Long story short, the particulars of the supply of M1B1 yarn by Chavanoz were deemed incompatible with the notion of an implicitly confidential sampling. And a public disclosure cannot be turned confidential ex post.

There was a side argument by the patentee that Helioscreen’s sale of fabric to their client Krüland was a non-prejudicial disclosure under article 55 EPC. This was considered as irrelevant by the court, since overall the public prior use took place even before 6 months prior to the priority date.

The third point at last. Chavanoz argued that the skilled person would not have been able to know the composition of the M1B1 product at the priority date without undue burden.

The defendant performed a number of experimental tests to counter this theory. First, they made the patented product according to the method taught in the patent, and then had the product analyzed. Second, they had a bailiff collect samples of the M1B1 yarn dating back to 1994 in Helioscreen’s premises, and had those analyzed as well.

The manufacturing was performed in the presence of a bailiff. All analyses were conducted in two independent labs, using analysis methods available at the priority date. Various experts’s reports were produced on both sides, either to challenge the results of the analyses, or to support them.

I will not go over the details of the discussion, which was technically quite complex, but it will suffice to say that the court was ultimately not persuaded by Chavanoz’ criticisms, and accepted Mermet’s conclusion that the M1B1 yarn could indeed be determined by the skilled person as falling within the patent claims.

As a result, claims 1, 2, 3, 5, 7 and 8 of the patent were deemed to lack novelty and were revoked, and Chavanoz’ infringement claim was dismissed.

Let me say that this decision is overall well reasoned and makes for an excellent read. I am therefore looking forward to the next submarine from Lyon – if any.

As a take home message, confidentiality agreements should really be put into place initially. There is no way back once a business relationship has started on a non-confidential basis.


CASE REFERENCE: Cour d’appel de Lyon, 1ère chambre civile A, September 12, 2019, SAS Mermet et al. v. SARL Chavanoz Industrie, RG No. 16/06896.