Manufacture or repair revisited

Authors: Brian Whitehead and Richard Kempner (Kempner & Partners LLP)

Schütz (U.K.) Limited v Werit UK Limited, Protechna SA, [2011] EWCA Civ 303, 29 March 2011

Journal of Intellectual Property Law & Practice (2011) doi: 10.1093/jiplp/jpr072, first published online: May 12, 2011

The Court of Appeal for England and Wales has overturned Floyd J's judgment in Schütz v Werit. While it is still the case that there is no free-standing right to repair in patent law, the ‘whole of the inventive concept’ test (ie asking whether, when the part in question is removed, what is left embodies the whole of the inventive concept of the claim) is no longer applicable to patent infringement. Instead, the correct approach is simply to ask whether the defendant has made a product falling within the scope of the patent claims.


Legal context

By section 60(1)(a) of the Patents Act 1977, a product patent is infringed by making, disposing, or offering to dispose of, using or importing the protected product, or keeping it for disposal or otherwise, without the consent of the patentee. This is a wide range of activities, but the concepts of repairing or reconditioning products are not specifically addressed in the Patents Act. Accordingly, it is necessary to decide whether the act of repairing or reconditioning a product constitutes ‘making’ a patented product.

Facts

This case relates to a type of container, used for transportation of liquids, known as an intermediate bulk container (IBC). This consists of an outer protective cage and a removable plastic inner bottle in which the liquid is held. In some IBCs, the bottle can be replaced when it becomes unusable. IBC manufacturers sell replacement bottles, but there is also a market for replacement bottles produced by manufacturers other than the manufacturer of the original IBC. Delta Containers Limited (‘Delta’) reconditions used IBCs by removing the old bottle, repairing the cage as appropriate, and fitting a new bottle. Delta purchased its replacement bottles from Werit, the first defendant. The reconditioned IBCs were then sold in competition with the original manufacturers’ products.

Schütz, the owner of European Patents (UK) 0 370 307 (‘307’) and 0 734 967 (‘967’) relating to IBCs, sued Werit for secondary infringement under section 60(2) of the Patents Act 1977 and (in separate proceedings) Delta for primary infringement.

In the Patents Court ([2010] EWHC 660 (Pat); see authors’ earlier article at JIPLP 2011, 6(1), 9–10) [published on the jiplp weblog, here], Floyd J held that ‘the correct approach is to ask whether, when the part in question is removed, what is left embodies the whole of the inventive concept of the claim’. On the basis of this approach, Floyd J concluded that replacing the inner container of a Schütz IBC with a Werit bottle does not amount to making a product which fell within the scope of either patent, as the inventive concept of the patents resided entirely in the cage, rather than the bottle. The patents were therefore held not to be infringed.

Analysis

Jacob LJ reconsidered the authorities, including the leading case on whether an activity constitutes ‘making’ a patent product, United Wire Ltd v Screen Services (Scotland) ([2001] RPC 24). Jacob LJ disagreed with Floyd J's analysis, holding that the ‘whole of the inventive concept’ test was not part of English law. In particular, Jacob LJ said ‘ … I think that United Wire not only endorses the “making” test but excludes any additional “whole inventive concept” test’. The correct question was simply ‘does the act of putting a bottle into a Schütz cage, constitute “making a product which is the subject-matter of the patent”’?

On the basis of this test, the defendant, in putting a new bottle in a repaired cage, had clearly made a product falling within the claims of the patent, and the patent was accordingly infringed.

Practical significance

Both Floyd J and Jacob LJ discussed the well-known conundrum of whether a patent for an inventive tennis racquet frame, with a claim calling for a strung racquet coupled to the inventive frame, would prevent re-stringing of the racquet. Jacob LJ mentioned two similar examples: a patent covering a steam whistle, with a sub-claim to a battleship fitted with the whistle, and a patent for a photocopier including a sub-claim for the machine when loaded with paper. Would the latter, for example, be infringed by a user merely loading paper into the machine, meaning that the patentee could insist on users buying his paper? Jacob LJ acknowledged such issues but said ‘It is not necessary for us to provide any general answer to the “restringing problem”’.

In the authors’ view, it is perhaps unfortunate that the ‘whole of the inventive concept’ test has now been disallowed. That test provided a solution to the above problems, albeit one without foundation in the Patents Act, and that could give rise to difficulties where the inventive concept is a combination of the retained and replaced/repaired parts. The ‘making’ test is undoubtedly easier to apply, but can give rise to strange and arguably unjust results, eg a tennis racquet manufacturer being able to monopolize the repairing of its products, or a photocopier manufacturer being able to control the supply of paper for it. Counsel for Schütz suggested that market considerations and competition law may prevent such outcomes. This may well be correct, but in the authors’ opinion IP law ought to be able to prevent such abuses without the need to invoke other areas of law.

Jacob LJ, during his long and illustrious career, did so much to clarify IP law that it is, to some, perhaps surprising that he did not feel able in this case to answer such potentially important questions as those posed in this case, other than implicitly accepting that competition law may be relevant and that each case needs to be decided on its own facts. Accordingly, the ‘restringing problem’ will need to be resolved in a future case.