Protocol not recognized

Another week, another issue of international jurisdiction. Last week’s post was about a case of declaration of non-infringement. This week’s post is about a case of ownership claim. But I think this time the decision issued by a French judge has a greater potential for arousing controversy.

In short: the judge decided that the Protocol on Recognition should be discarded in the determination of jurisdiction in the case at hand. The “Protocol on Recognition” is short for “Protocol on Jurisdiction and the Recognition of Decisions in respect of the Right to the Grant of a European Patent“. The object of the Protocol is to define which courts of the EPC contracting states shall have jurisdiction to decide claims, against the applicant, to the right to the grant of a European patent.

Pursuant to Article 164(1) EPC, the Protocol is considered as an “integral part” of the EPC, and therefore is part of an international agreement. So, I think the decision by the judge not to apply the Protocol is a pretty big deal.

Let’s turn to the specifics of the case. This is a dispute between a British company, NCAM Technologies Ltd. and a French company, Solidanim, both active in the field of motion picture technology. Both hold IP on similar technologies, respectively called NCAM Live and SolidTrack.

Solidanim filed a French patent application in December 2011, followed by a European patent application in December 2012, claiming the priority of the French application. The French patent was granted, and the European application is still pending.

NCAM Technologies Ltd. filed a British patent application in May 2012, followed by another British patent application and a PCT application in May 2013, claiming the priority of the initial 2012 filing. The PCT application entered regional phase at the EPO.

Filing date 1918 – the early days of cartoon technology.

Apparently, Solidanim told clients that NCAM had stolen its SolidTrack technology. NCAM did not like that and sued Solidanim in front of the Paris Tribunal de grande instance (TGI) in October 2015. NCAM requested that Solidanim’s French patent be held invalid, and that Solidanim be declared guilty of unfair competition due to disparagement.

In March 2016, Solidanim counterclaimed for infringement of its French patent and of its European patent application and for unfair competition.

Even more importantly for the present post, Solidanim claimed ownership of NCAM’s British patent, PCT application and resulting European application.

In June 2016, NCAM retaliated by presenting the case management judge with a number of procedural requests:

  • that the proceedings should be stayed with respect to Solidanim’s infringement claims;
  • that the proceedings should continue with respect to NCAM’s nullity claim; and
  • that the court should acknowledge its lack of jurisdiction with respect to Solidanim’s ownership claim.

This leads us to the order issued by the case management judge in November 2016. The first request was quite easily granted. Indeed, infringement proceedings based on a pending European patent application are stayed as of right (article L. 615-4 Code de la propriété intellectuelle). Furthermore, infringement proceedings based on a French patent are also stayed as of right if there is a parallel European patent application which is still pending (article L. 614-15 Code de la propriété intellectuelle). This is because the French patent is bound to totally or partially disappear after the grant of the European patent (more specifically, at the end of the opposition time limit or at the end of the opposition proceedings, if any).

Turning to the second request, there was no mandatory rule for the judge to follow. He had discretion whether to proceed further or to stay. He decided to stay, “for a good administration of justice“, according to the ritual phrase, due to the parallel European patent application still being examined at the EPO, and since the fate of the French patent is closely tied to that of the European application.

But the big prize was the third request. NCAM based its request on the Protocol on Recognition, and more specifically article 2:

Subject to Articles 4 and 5, if an applicant for a European patent has his residence or principal place of business within one of the Contracting States, proceedings shall be brought against him in the courts of that Contracting State.

Articles 4 and 5 are irrelevant here, as they relate to employees’ inventions and cases in which there is a preexisting agreement with a jurisdiction clause in place between the parties.

So, this is quite straightforward. According to article 2 of the Protocol, the British courts should have exclusive jurisdiction to rule on Solidanim’s claim for ownership of NCAM’s European application, since NCAM has its principal place of business in the UK.

However, Solidanim relied on the Brussels I regulation, namely regulation (EU) No. 1215/2012, already discussed last week. More specifically, Solidanim relied on article 8(3) of the regulation, per which:

A person domiciled in a Member State may also be sued: […] (3) on a counter-claim arising from the same contract or facts on which the original claim was based, in the court in which the original claim is pending.

Claims were already pending in the Paris TGI due to NCAM’s original complaint. Solidanim’s case was that their ownership counterclaim arose from the same facts on which the original nullity and unfair competition claims were based. As a result, the French court also had jurisdiction under the Brussels I regulation.

The judge thus had to address two questions:

  • First, as a matter of fact, did Solidanim’s ownership counterclaim indeed arise from the same facts on which the original claims were based?
  • Second, as a matter of law, which provisions should prevail: those of the Protocol on Recognition or those of the Brussels I regulation?

As to the first point, the judge agreed with Solidanim that the conditions of article 8(3) of the regulation were met:

[…] The latter claims are closely related to the circumstances of fact and relations between the parties, which need to be assessed so as to determine whether the filings made by NCAM did or did not violate Solidanim’s rights on the FR’057 patent, the validity of which is challenged in front of the Parisian court. 

I am not sure I fully understand why a nullity claim concerning one patent is necessarily closely related to an ownership claim concerning other, later applications by another party – apart from the general background of the case. On the other hand, it seems quite clear that NCAM’s unfair competition / disparagement original claim was closely related to Solidanim’s ownership counterclaim. In both cases, the issue, to put it bluntly, was whether or not NCAM had “stolen” Solidanim’s technology.

But the legal issue is certainly the most interesting one. Both the Protocol and the regulation contain some general provisions on how they should be articulated with other legal instruments.

On the one hand, according to article 11(1) of the Protocol:

In relations between any Contracting States the provisions of this Protocol shall prevail over any conflicting provisions of other agreements on jurisdiction or the recognition of judgments.

So the Protocol proclaims itself to be superior to any other agreement. But the regulation is not an agreement. It is a piece of EU law.

On the other hand, the regulation contains an entire chapter (articles 67 to 73) on its relationship with other instruments. This chapter contains general guidance and some specific provisions, but no specific provisions regarding the Protocol on Recognition.

So the judge turned to a CJEU decision relevant for this issue, namely C-533/08 (TNT Express Nederland BV v. AXA Versicherung AG) of May 4, 2010. This decision deals with the articulation between regulation (EC) No. 44/2001, which was the previous version of the Brussels I regulation, and an international agreement, namely the Convention on the Contract for the International Carriage of Goods by Road, signed in Geneva in 1956.

The court interpreted article 71 of regulation 44/2001 as meaning that:

in a case such as the main proceedings, the rules governing jurisdiction, recognition and enforcement that are laid down by a convention on a particular matter […] apply provided that they are highly predictable, facilitate the sound administration of justice and enable the risk of concurrent proceedings to be minimised and that they ensure, under conditions at least as favourable as those provided for by the regulation, the free movement of judgments in civil and commercial matters and mutual trust in the administration of justice in the European Union (favor executionis).

Article 71 of regulation 1215/2012 is similar to article 71 of regulation 44/2001. Therefore, the judge applied the criteria set by the supreme court of the EU, based on the premise that the same criteria should apply whatever the international agreement at stake is.

The judge acknowledged that the Protocol on Recognition affords a high degree of predictability.

However, turning to the objectives of sound administration of justice and of minimizing the risk of concurrent proceedings, the judge noted that the claims and counterclaims at stake were so closely related that the sound administration of justice and the minimization of the risk of concurrent proceedings were better served if all claims and counterclaims were handled by the same court.

The judge noted that

On the one hand, the [NCAM] patents relate to a system similar to the one claimed by Solidanim in its FR’057 patent, in that they deal with real-time merging or composing of computer-generated 3D objects and a video stream from a video camera. And on the other hand, the ownership claims rely on the same factual circumstances relating to the relationships between the parties and their employees, which lead them both to claim a primacy on the inventions provided in these different patents or applications and to consider that the statements made by the parties against each other constitute acts of unfair competition. 

Consequently, said the judge, the Protocol for Recognition did not pass the test set in C-533/08 in the present circumstances, and it should thus simply be ignored, to the benefit of the Brussels I regulation.

Let’s see how this case further develops. It could even be a matter for further reference to the CJEU down the road, could it not?

As a side note, in a few years’ time, I assume that the Brussels I regulation will no longer apply to the UK, so that a similar situation will have to be handled completely differently.


CASE REFERENCE: Tribunal de grande instance, 3ème chambre 2ème section, ordonnance du juge de la mise en état, November 24, 2016, NCAM Technologies Ltd. v. Solidanim, RG No. 15/15648.

Groundhog case

Okay, campers, rise and shine and don’t forget your booties ’cause it’s cold out there today!

I don’t know if this sentence will ring a bell to some readers, but it is my favorite quote from the classic comedy Groundhog Day, in which poor Bill Murray cannot get out of a day he keeps re-living.

The movie came to my mind when reading about the latest development in the Nergeco v. Maviflex case. I don’t know if this patent litigation has broken a record or not, but it sure looks like the judicial equivalent of a groundhog day that never ends.

Here is the extraordinary timeline of the case:

  • At the end of the nineties, Nergeco (patentee) and Nergeco France (licensee) sued two companies, Mavil (now Gewiss France) and Maviflex, for infringement of a European patent.
  • On December 21, 2000, the Lyon Tribunal de grande instance (TGI) held that the plaintiffs’ claims were admissible but ill-founded. The plaintiffs appealed.
  • On October 2, 2003, the Lyon Cour d’appel set aside the first instance judgment and concluded that the patent was infringed. The court ordered an expertise to assess damages.
  • On October 15, 2005, the Cour d’appel issued a second judgment further to the expertise. The amount of damages was set to 60,000 euros to the patentee (Nergeco) and 1,563,214 euros to the licensee (Nergeco France). The defendants then filed an appeal on points of law.
  • On July 10, 2007, the Cour de cassation partly set aside the 2005 judgment regarding the damages to be paid to the licensee. The reason for the reversal was that the Cour d’appel had not addressed the argument that the license agreement had been registered in the patent register only in 1998, so that it was not enforceable against third parties before that date. The case was thus remitted to a different Cour d’appel, in Paris this time.
  • On June 2, 2010, the Paris Cour d’appel held that all claims against Mavil (now Gewiss France) were in fact inadmissible as Mavil no longer existed when they were initially sued; and reduced the amount of damages to be paid by the second defendant Maviflex to the licensee Nergeco France by approximately half (taking into account the date at which the license agreement was registered and became enforceable against third parties). Both sides filed another appeal on points of law.
  • On September 20, 2011, the Cour de cassation set aside the 2010 judgment. First, because the Cour d’appel should have ruled on an argument of invalidity of the license agreement (there was no res judicata on this issue, as it was not addressed in the 2003 and 2005 judgments). Second, because the argument that the claims against Mavil were inadmissible should not have been given any consideration, as Mavil / Gewiss France acted in the proceedings as if their designation in the initial complaint was correct. In fact, this part of the decision became very famous since it is one of the few illustrations of an estoppel principle in this country.  The case was again remitted to the Paris Cour d’appel.
  • On June 21, 2013, in a new judgment by the Cour d’appel, the case was reexamined pursuant to the instructions of the Cour de cassation. But the actual outcome was pretty much the same as in the previous judgment. In particular, the damages award to Nergeco France was similar to the one ordered in 2010. The defendants filed a third appeal on points of law.
  • On December 16, 2014, the Cour de cassation set aside the 2013 judgment. Once again, the supreme court ruled that the appeal judges should have ruled on some arguments relating to the inadmissibility of Nergeco France’s claims.

And this finally leads us to the latest decision in the series, issued by the Paris Cour d’appel on October 28, 2016, and which addresses the inadmissibility arguments that the Cour de cassation held needed to be addressed.

What an incredible mess… This lawsuit has now been pending for almost two decades, and the Cour de cassation set aside appeal judgments three times. It may not even be over yet. For all I know, the losing parties may have referred a fourth appeal on points of law to the Cour de cassation.

Fortunately, this is a very exceptional situation due to the fact that (1) the Cour d’appel repeatedly failed to address arguments that the supreme court believes should have been addressed; and (2) the supreme court repeatedly remitted the case to the appeal stage instead of putting an end to the lawsuit.

Groundhog day and Goodbye Lenin: very different but both fun to watch.

While the context of the case is by itself fascinating, the content of the October 28, 2016 decision is also quite interesting, as it notably addresses the issue of the coexistence of French and European patents.

As a recap, the issue at stake was whether Nergeco France’s claims in the lawsuit were admissible. The court held that they were not, because the agreement containing the license provision was invalid.

Remarkably, the court found not one but two independent reasons why the agreement was invalid.

The first reason was one of contractual law. The agreement between Nergeco and Nergeco France was executed on December 6, 1990. At that time, Nergeco France was not yet registered in the commerce register. It is possible for a company to enter into an agreement before its incorporation, but special formalities need to be observed. This was not the case here. The agreement even mentioned that Nergeco France was registered in the commerce register of the good town of Le Puy, under a certain number – which was untrue, as the registration only took place on February 2, 1991.

The agreement was thus executed by a company with no legal capacity.

The second reason was more specific to patent law. Article 8 of the agreement recites that

if necessary, Nergeco will be in charge of obtaining and maintaining patents. Nergeco Fance will ipso facto be a licensee of the patents for France. 

An annex to the agreement, dated January 31, 1991, specifies that, by application of article 8, a license is granted by Nergeco to Nergeco France on a number of patents, among which the European patent in suit.

However, the agreement and its annex are silent as to the French patents to which the European patent in suit claims priority.

Because of this silence, the Nergeco companies fell into the trap of article L. 614-14 Code de la propriété intellectuelle:

A French patent application or a French patent and a European patent application or a European patent having the same filing date or the same priority date, protecting the same invention and belonging to the same inventor or successor in title cannot, for the parts in common, be independently subjected to a transfer, security, pledge or authorization of exploitation rights, subject to invalidity. 

This provision is one of the tools for preventing some forms of double patenting in this country.

In the present case, the European patent was licensed to Nergeco France, but not the French priority patents. As a result, the license was invalid.

The plaintiffs tried to escape the L. 614-14 trap by presenting several interesting arguments.

A first defense was that the general sentence “Nergeco Fance will ipso facto be a licensee of the patents for France” in article 8 of the agreement meant that the French patents were also concerned. The court replied that the licensed patents were necessarily expressly mentioned in the agreement – and the French patents were not.

A second defense was based on article L. 614-3 Code de la propriété intellectuelle, according to which a French patent covering the same invention as a European patent granted to the same inventor or successor in title ceases to be in force at the end of the European opposition period (or at the end of the opposition proceedings, if an opposition is filed).

The opposition period ended on July 13, 1994. Nergeco argued that the two French patents ceased to be in force on that date. Therefore, the ground for invalidity related to the absence of mention of the French patents in the agreement no longer existed from that date. The court rejected the argument, as this ground for invalidity must be appraised on the day the agreement was executed. It cannot be cured afterwards.

For the same reason, the court did not take into account subsequent actions (such as the renewal of the agreement, later amendments to the agreement, etc.).

And so, after all this time, the licensee was finally found not to be an actual licensee.

Nergeco France saw this coming, and therefore tried to convert its claims as a licensee into claims based on unfair competition. But these were new claims and were thus held inadmissible at this stage of the lawsuit.

As a final word (for now?) on this story, things seem to have gotten very nasty between the claimants and defendants. The judgment briefly mentions a number of parallel proceedings, including criminal ones.

It also seems that Gewiss France and Maviflex argued that the agreement between Nergeco and Nergeco France was forged. The court did not take sides on this. I wonder if the alleged forgery relates to the date of the agreement. From an outsider’s perspective, the fact that the agreement makes reference to a company having a registration number although the registration had not yet been performed at the time is indeed troubling. Could it be that the court was troubled as well, leading them to being quite strict on formal invalidity issues?

One can only speculate, not having access to the file wrapper.


CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 1, October 28, 2016, Nergeco SA & Nergeco France SAS v. Gewiss France SAS & Maviflex SAS, RG No. 2015/01298.

Of employees and drugs

No, this is not a post about employees who do drugs. In fact, contrary to what the title suggests, there is nothing in common between employees and drugs in my mind, except that I would like to briefly report on two different subjects and that it is somewhat more convenient to group both in a single article.

Drugs first, with a follow-up on the sofosbuvir case which was reported on earlier on this blog.

As readers may remember, an opposition division of the EPO maintained Gilead’s patent EP 2203462 on a blockbuster drug for the treatment of HCV infection further to the oral proceedings which took place on October 4-5, 2016. Several granted claims were deleted in the amended version of the patent due to extension of subject-matter, including a claim specifically directed to sofosbuvir. One remaining claim recited a generic formula which could be interpreted either as covering both sofosbuvir and its stereoisomer, or as covering only the mixture of sofosbuvir and its stereoisomer. This left a number of observers wondering what the amended patent is really about, and more importantly whether it sill protects Gilead’s drug.

The update is that the written decision of the opposition division was issued on October 31, 2016. It can of course be downloaded from the online register.

In this decision it seems quite clear that the opposition division has chosen the second interpretation. In other terms, they believe that the main remaining claim covers a mixture of sofosbuvir and its stereoisomer. Indeed, the term “racemate” is repeatedly used in the decision when referring to the subject-matter of the claim.

This is especially clear in the section of the decision which deals with the ground of opposition of insufficiency of disclosure. It was alleged by one of the opponents that the patent did not contain enough information to make the individual stereoisomers. The opposition division rejected the objection with the following statement:

The OD considers that claim 1 is directed to a racemate i.e. a mixture of the enantiomers and not the pure enantiomers. As indicated by the Patentee it is not contested that the racemate of claim 1 can be produced. This interpretation of claim 1 means that it is not necessary to come to a decision as to whether or not the patent in suit sufficiently discloses how to isolate and characterise the enantiomers. This issue is not relevant to claim 1. The OD considers that the auxiliary request 1 meets the requirements of Art. 83 EPC.

So, if one follows the opposition division’s interpretation, it seems that the amended patent may no longer cover Gilead’s drug, which is as far as I understand a pure isomer and not a mixture. But here is the catch: national courts are not bound by the interpretation put forward by the EPO. As regards French courts, many illustrations of this have already been provided in previous posts. So, the conundrum is still there. Also, it is all but certain that multiple appeals will be filed. So, in 2 to 5 years we will be able to read the Board’s take on this issue.

But we will not have to wait that long to comment on the case again, as new interesting developments still keep coming up. In a letter dated November 3, 2016, the proprietor’s representative requested a correction of the minutes of the oral proceedings, as well as of the decision. She stated that the minutes and decision misrepresent the patentee’s position regarding the scope of claim 1.

Indeed, the opposition division reported that the patentee had stressed that claim 1 “does not embrace individual stereoisomers“; whereas in fact, says the representative’s letter, the patentee always expressed the view that individual stereoisomers are “within the scope of claim 1” but that claim 1 “does not particularize individual stereoisomers“.

Even if the opposition division were to correct the decision and the minutes as requested by the patentee (which could be a long shot), the opposition division’s own assessment of the scope of claim 1 would remain unaltered. But the patentee’s actual statements during the oral proceedings might possibly be of relevance in front of a judge, which is the reason for this pre-appeal move.

Interestingly, the representative asked for new oral proceedings if the request for correction were to be rejected. So, make sure to grab your bucket of popcorn and to watch the comments section below for any update on this matter – all the more so that one of the opponents also made a (different) request for correction. The opposition division’s job is certainly not an easy one in such a high profile case.

As a side note, the decision of the opposition division contains a number of other interesting aspects. Entitlement to priority was challenged, which gave rise to a review of U.S. law in relation to assignments. There is also a long discussion on the public availability of a document D5 which is a university thesis. The opposition division came to the conclusion that the document was not part of the prior art because, on the balance of probabilities, there seems to have been a bar on access to the document at the relevant period of time.

The inventive step section is also noteworthy. Several starting points were taken into consideration by the opposition division, and the surviving claims were found inventive over all starting points, the technical problem being the provision of alternative HCV inhibitors.

Now, here comes the “employees” part of the post which, as I warned, is truly unrelated to the first part.

A device for employees' drug screening
A device for employees’ drug screening

The French patent and trademark office (INPI) has recently released an extensive study on compensation policy for employees’ inventions.

According to French law, all inventions made by employees in the context of a task assigned to them by their employer (be it a general task assigned in the employment agreement or a specific task assigned during the course of employment) belong to the employer. But the employer must pay a bonus to the employees – or “rémunération supplémentaire“.

The core of the INPI’s study is a survey on how businesses deal with this legal requirement. This is quite enlightening as the statute does not provide many details and leaves it open how the compensation should be calculated and when it should be paid. Case law on this topic has provided some guidelines without however setting any generally applicable rules.

There are many interesting questions in the survey, but I picked a few ones which I found particularly blog worthy:

First, the form of the compensation. 60.5% of companies offer a lump sum-only compensation. Only 1.2% provide a compensation which is entirely dependent on whether/how the invention is exploited. The rest of the surveyed rely on a combination of both. Lump sum-only systems are certainly easier to implement (and potentially cheaper). But compensation systems which somehow take into account the exploitation of the invention might be more resistant to a court challenge.

Second, the points in time at which the compensation is paid. There are many different possibilities here, and in some companies several installments are paid over time. Thus, bonuses are typically paid when the initial patent application is filed (76.5% of respondents); when patent applications are filed abroad (33.3%); when a patent is granted at the EPO or abroad (34.6%); during exploitation of the invention (33.3%); etc. Interestingly, 8.6% of the surveyed said an installment is paid as soon as the employer becomes aware of the invention.

Third, the amount of the compensation. This is of course a key aspect. The study makes a distinction between lump sum-only compensation systems and mixed compensation systems (wherein the exploitation of the invention is partly taken into account):

  • In lump sum-only systems, the median value of the minimum awarded bonus is 500 €, while the median value of the maximum awarded bonus is 2,000 €. The maximum amount reported in the entire survey is 11,000 €.
  • In mixed systems, the median value of the minimum awarded bonus is 400 €, while the median value of the maximum awarded bonus is 15,000 €. The maximum amount reported in the entire survey is 105,000 €.

In summary, the span is broader in mixed systems, with a shift towards higher compensations. I assume that the higher bonuses must be rare: they must correspond to exceptionally valuable inventions.

The study also contains a breakdown of lump sum installments, depending on the point of time at which they are paid. For instance, in the majority of cases, the bonus for the initial patent application filing is between 500 and 1,000 €. But foreign filing bonuses and patent grant bonuses are somewhat higher, with a majority of cases between 1,000 € and 2,500 €.

Fourth, the frequency of disputes between an employer and its inventors. Fortunately, 67.2% of those surveyed reported no dispute. In 10.1% of cases, the employer received at least one complaint from an inventor. In 10.1% of cases, a dispute had to be handled by the national conciliation commission (CNIS, Commission nationale des inventions de salariés). In 6.3% of cases, a dispute went as far as a lawsuit in front of the Tribunal de grande instance (TGI).

If we add the CNIS and TGI cases, this is 16.4%, which seems to me like a relatively high dispute rate.

The study contains a number of other interesting data. It offers a comparison with a similar study performed in 2008. It provides practical examples of compensation systems set up by a number of companies, such as Air Liquide. This should be most useful for those businesses which still need to set up their own compensation system. In this respect, 7.4% of those surveyed still do not have a compensation system in place, although this is required by the law. My guess is that among those not surveyed, including many IP-unaware SMEs, the proportion could be significantly higher.

The study also provides a comparison of the French legal framework with other systems abroad.

Some of the annexes are also useful. One of them provides a list of bonuses awarded by the CNIS between 2011 and 2015. The amount awarded by invention ranges from 333 € to 50,000 €, with a total amount (for all inventions in dispute) ranging from 1,000 € to 300,000 €. This broad range certainly corresponds to a large variety of inventions, from useless ones to extremely profitable ones.

Another annex provides a list of damages awarded to employees by courts of law (as a compensation for unpaid invention bonuses) in the past few years. Again, the span is broad. However, the highest amount on the table (more than 1,000,000 € for two inventions) was in fact in a case where the inventions were not made in the context of a task assigned to the employee and therefore pertained to a different legal regime – one where the employer has a right on the invention but must buy the invention from the employee.

In summary, this is a must-read in particular for in-house patent attorneys and more generally for all involved in employees’ inventions in this country.

A solo invention

France is well known around the world for its baguette bread, strong cheese, good wines and frequent strikes. Turns out French IP also has clichés of its own, and one of them is probably the Soleau envelope. Although the general public does not necessarily know much about IP law, they have usually at least heard of this national institution.

The Soleau envelope is a way to self-preserve evidence by putting any document in a sealed envelope and having it date-stamped and kept in store by the INPI (the French patent and trademark office). It is popular probably mainly because it is a cheap and easy process. But this comes at a price of a number of misconceptions (just like some of the other French clichés), as many people tend to believe that it is a lesser alternative to a patent – which of course it is not.

The Soleau envelope had an inventor, Mr. Eugène Soleau, who quite interestingly filed and obtained… two patents for his invention. At least he knew better.

The Soleau envelope patent.
One of the Soleau envelope patents.

The case discussed today is relatively exceptional in that it is an example of a situation in which Soleau envelopes were actually useful in the end. There is yet another reason why the case is fairly exceptional: it relates to a claim for ownership of a patent, and the claim was successful – quite often the burden of proof on an ownership claimant is simply too heavy to be properly discharged.

Mr. Courau is a specialist of pine resin extraction, which is a traditional practice in the Southwestern part of France. Resin extraction is performed by making an injury on the trunk of the tree. Resin exudation can be stimulated by spraying sulfuric acid on the injury, but this has obvious drawbacks for the environment and workers.

According to the judgment, Mr. Courau has been experimenting the use of alternative resin exudation stimulating agents, comprising notably citric acid or sodium citrate, for a number of years.

He filed Soleau envelopes describing his work in 1994, 1995, 2003, 2009, then on July 7, 2010 and finally on August 18, 2011.

Between 2007 and 2012, he worked with the company Holiste Laboratoires et Développement, which specializes in aromatherapy. A confidentiality agreement was signed between them on July 7, 2010 (the same day as the fifth Soleau envelope was filed), and then apparently a collaboration agreement two weeks later.

On March 16, 2012, Holiste filed a French patent application. This application was eventually withdrawn but a divisional application was also filed which matured into a patent. Holiste also filed a PCT application claiming the priority of the French application. Mr. Courau found out about these filings and sued Holiste in June 2014, claiming ownership of the patents / applications because, he said, the invention was stolen from him and the filings violated the 2010 confidentiality agreement.

Holiste’s defense was that Mr. Courau was not the inventor of the patents / applications at stake. They said he had offered to replace the conventional acid stimulating agent by a neutral stimulating agent. The parties had therefore discussed a possible neutral composition based on sodium citrate, calcium carbonate and water. On the other hand, the invention at stake is rather about using citric acid as a stimulating agent. This concept was suggested by another technician (namely the person designated as the inventor in the French and PCT filings).

The court analyzed the claims and the description of the French patent. The main claims recite a solution containing citric acid or a derivative thereof for stimulating resin exudation. Various additives can be employed, including in particular a filler such as clay.

The court then turned to the contents of Mr. Courau’s successive Soleau envelopes. In those dated 1994 to 2009, stimulating compositions based on sodium citrate are mentioned. As a reminder, sodium citrate is a salt of citric acid; when put in a solution citrate sodium will decompose and yield citrate (a base) and/or citric acid (guess what: an acid) depending on the pH of the solution. Anyway, in the later Soleau envelopes of July 2010 and August 18, 2011, citric acid per se is mentioned.

Then the court reviewed the collaboration agreement of July 2010. The agreement defines confidential information exchanged in the framework of the agreement and provides that the recipient of confidential information from the other party has no right on (notably) related inventions. In a letter dated September 3, 2010 to Holiste’s designated inventor, the plaintiff had explicitly referred to “the neutral exudation paste which contains sodium citrate and the know-how necessary for its implementation” as confidential information under the agreement.

Finally, the court took into account of number of email exchanges. In August 2010, Holiste acknowledged that Mr. Courau was the sole inventor of a new resin exudation stimulation composition. The filing of a patent application by Mr. Courau was planned after some additional testing, with a license to be granted to the company. In December 2011, Holiste further confirmed in writing that Mr. Courau was the inventor of the exudation stimulation composition.

The court considered all the above evidence as convincingly showing that Holiste had indeed been disloyal and breached the agreement by filing a patent application on his invention. The invention was a solo invention made by the plaintiff.

The court disregarded Holiste’s defense based on the use of the term “neutral by Mr. Courau to characterize his invention (whereas the patent applications mention the use of citric acid):

Claude Courau invented the composition of an exudation paste that he termed as “neutral”, not in a chemical sense (i.e. at pH 7) but in a common sense, meaning that it is not harmful for man and the environment, unlike sulfuric acid which was previously used. It cannot be concluded from the awkward use of this term that the product did not contain any acid. On the contrary, all documents mentioned above, which are dated prior to the patent filing, recite the presence of either citric acid or its derivative sodium citrate (which is obtained by adding soda). 

As a result, the court ordered that Mr. Courau be retroactively considered as the sole applicant of the French patent, as well as of the PCT application, “including patent applications originating from national phase entries thereof“.

The plaintiff was also awarded 10,000 euros for moral prejudice as well as 8,000 euros for reimbursement of attorney’s fees.

It seems that the claimant in this case was a very careful person, who had extensively documented his work or ideas over the years. This is not so common and is certainly the reason for the positive outcome that he obtained.

I do wonder however whether the court sufficiently reviewed all the claims of the French patent. For examples, dependent claims 6, 7 and 10 recite the presence of clay as a filler, in particular bentonite or kaolin. Whether this embodiment was also communicated by the plaintiff to Holiste prior to the filing date is unclear as the judgment is silent on this aspect. Also, the PCT application contains a slightly different claim set, with some additional features.

It seems to me that, if Holiste’s designated inventor contributed to at least some of the claims, the court should have ordered co-ownership instead of a full retroactive transfer of ownership.

As a last remark on this case, the PCT application entered into European regional phase. This is not mentioned in the judgment, but of course the file wrapper is accessible online on the EPO website.

In December 2014, Mr. Courau’s representative requested that the examination proceedings be stayed due to the pending ownership litigation. This request was immediately accepted by the EPO.

Holiste’s representative countered by stating that the lawsuit was groundless and by directly attacking Mr. Courau. The legal division of course stayed miles away from taking position on the merits of the case but simply explained that the legal conditions for ordering a stay of proceedings were met.

In July 2016, Holiste’s representative nevertheless filed amended claims to (oddly) align the European claims onto the French granted claims. Of course, this amendment could not be processed by the EPO. As a result, Holiste’s representative sent another letter in August 2016 expressing bewilderment at the EPO’s refusal to deal with the amendment.

To be continued. The next steps in the examination proceedings will of course depend on whether an appeal was lodged by Holiste against this TGI ruling.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 3ème section, May 13, 2016, Courau c/ Holiste Laboratoires et Développement, RG No. 14/09297.

An uplifting patent

It seems that we will not be getting any UPC case law to comment on any time soon after all… In fact, some in the European IP profession have expressed quite a bit of distress at last week’s political upheaval. So I thought that today’s post had better be uplifting in order to curb current gloominess.

Unfortunately all that I have been able to find in terms of uplifting is… a patent case related to a lifting platform. Well, at least that’s something, isn’t it?

So, cheer up and back to good old national case law!

There are two different aspects which may be of some interest in today’s decision. One relates to patent substitution, and the other one relates to public prior use.

But first things first with the basic facts of the case.

FOG Automotive Distribution is the owner of a French patent No. FR 2896785 and of a corresponding European patent No. EP 1813568, claiming the priority of the French one. Or rather, was, as the company was liquidated during the litigation, its interests being then represented by the liquidator.

FOG sued three interrelated companies Launch France, Launch
Europe GMBH and Launch Tech, for, ahem, “launching” lifting platforms infringing the patent.

At first instance, the Paris Tribunal de grande instance (TGI) held that the French patent had ceased to be in force but that the French part of the European patent was indeed valid and infringed.

On May 27, 2016, the Cour d’appel confirmed most of this ruling and put an end to the case by directly awarding the liquidator a (relatively modest) amount of damages.

As I explained in a previous post, a European patent is said to substitute for a French patent, when both patents have three elements in common:

  • Same inventor(s).
  • Same filing or priority date.
  • Same invention.

By way of analogy with the assessment of a priority claim, the most frequent issue is whether both patents actually relate to “the same invention“. In order to properly answer the question, you need to look at the claims and more particularly the main claims of both patents.

In this case, claim 1 of the French patent reads as follows:

Lifting platform, in particular for a motor vehicle, comprising at least one column (1), at least one carriage (2) which is movable along the at least one column (1), and designed to support the motor vehicle or part of the latter directly or by means of a support element, and means forming a locking/unlocking lock designed to lock in a given position the said at least one carriage or allow it to be movable along the column, the locking/unlocking means consisting of a rail comprising a plurality of slots (6) and means forming a locking/unlocking (20) catch, characterised in that along the at least one column there are at least two catches (20, 40) spaced apart from one another in respect of their height, the height dimension of the rail being approximately equal to the distance between the at least two catches (20, 40).

Claim 1 of the European patent is identical but for the last underlined part, which reads as follows: “the height dimension of the rail being lower than the height of the catch (40) furthest from the base of the at least two catches“. 

The court held:

[…] The European patent was more specific than the French patent claim. The latter only specified approximately equal heights, while the European patent was more specific by indicating a height dimension for the rail which is lower than the height of the catch. […] Therefore, the first instance judges rightly held that FOG’s claims relating to the French patent are inadmissible due to the grant of the European patent on the same invention which results in the French patent no longer being in force. 

I think the conclusion is correct but the reasoning is not very accurate. Indeed, unless I missed something, I think it is the European claim which is broader than the French claim and not the other way around.

The European claim merely recites a maximum value for the height dimension of the rail, whereas the French claim demands that the height dimension be approximately equal to a certain value. Therefore, it certainly makes sense for the European patent to fully substitute for the French patent. The most usual situation is for a European patent to be more restricted than the French priority patent. In this case, part of the broader French patent survives the substitution. But the present situation is different.

Another form of platform: a platform shoe with a storage compartment. The application suggests to use this compartment for "keys, driver’s license, money, and other small but necessary articles".
Another form of platform: a platform shoe with a storage compartment. The application conveniently suggests to use this compartment for “keys, driver’s license, money, and other small but necessary articles”.

The second point of interest in the decision is the novelty challenge raised by the appellant, which was based on an alleged public prior use. Launch Tech first argued that they had publicly presented several lifting platforms to the public before the priority date of January 27, 2006: some at a fair in Frankfurt in September 2004 and others at the Equip’auto fair of October 2005.

As evidence, Launch offered photographs of the equipment presented at the fairs. Those were however quickly dismissed by the court, since their date was not proven.

Then Launch made reference to a lifting platform referenced as TLTE 240SBA and delivered to a workshop in Dillenburg, Germany.

Launch filed a report written by a patent attorney. The patent attorney stated that he went to the workshop and took pictures of the platform. He noted the presence of a metal plate under the platform bearing the reference number TLTE 240SBA, the manufacturing date “2005/08” and the name and address of Launch Tech.

The court noted:

[…] He indicates that the information was engraved on the plate which was connected to the column and adds: “at first sight this is the original plate i.e. I do not think that it was replaced by another plate”. This indication is obviously an impression reported by Mr. T. which cannot prove the date of the lifting platform at stake and does not make it possible to retain it as prior art. 

Still concerning this lifting platform in the Dillenburg workshop, the alleged infringer also filed an affidavit by one of its technicians. The technician stated that he remembered delivering and putting the machine into service in December 2005. A copy of the corresponding intervention request was annexed to the affidavit.

Again, the court rejected the evidence.

First, the court noted a discrepancy between the platform reference number in the document in annex (TLTE 40SBA) and the actual platform reference number (TLTE 240SBA). An explanation for the discrepancy, though: the first number was an abbreviation for the second number, the missing figure 2 simply meaning a platform with two columns.

Second, the court more generally put the credibility of the witness into question:

[…] Nevertheless this affidavit was drafted by an employee of Launch Tech; and it is also questionable because, although Launch Tech markets different types of materials and lifting platforms, he stated that he remembered the serial number of a platform sold in 2005 when he wrote the affidavit on May 2, 2014. 

As a final remark on this issue, the court blamed the appellant with simply stating that the claims of the European patent were anticipated by its platforms TLTE 232SBA, TLTE 240SBA, TLT 235SBA and TLT 235SCA, without explaining the differences between the models and without describing their specific features (including the catches).

Consequently, the novelty challenge failed. So did the inventive step challenge. And the appeal judges also confirmed the first instance finding of literal infringement based on a bailiff’s saisie report of October 2011.

Interestingly, the infringing platforms bore the reference numbers TLTE 32SBA and TLTE 40SBA, i.e. similar references to those used in the unsuccessful public prior use defense. So at least the fact that the alleged prior use apparatuses had all claimed features appears relatively credible – although it can always be theoretically contemplated that the design of a device with a certain reference number can change over time.

In summary, the demonstration of public prior use in this country requires a high burden of proof – as in “Everest high” – just like at the EPO, although we do not use the warlike expression “up to the hilt”. 

On the one hand it is certainly very reasonable to demand absolute certainty when the patent proprietor has no personal knowledge of the alleged prior use and no access to the relevant evidence.

But on the other hand, this situation can also be quite frustrating for a nullity plaintiff (or similarly for an opponent at the EPO). You sometimes get the feeling that actual public prior uses are impossible to rely on in practice because there will never be enough records from that time and because every document or affidavit can be criticized one way or another as being incomplete or doubtful.

How a more fair balance could be reached is a tricky question. Maybe through greater resort to depositions of witnesses under oath?


CASE REFERENCE: Cour d’appel de Paris, pôle 5, chambre 2, May 27, 2016, Launch Tech Company Ltd. v. FOG Automotive Distribution, RG No. 14/02829.