We have reported earlier on this Blog here about the litigation betwwen Laurastar and Innosteam about ownership of (the national phases of) two PCT applications, WO 2018/006994 A1 and WO 2018/036653 A1; see the EPO Register here and here. The patent applications are about devices and methods for producing instant steam (WO’994) and instant hot water (WO’653), for use e.g. in devices for ironing.
Nothing has surfaced after the main hearing of 25 June 2019. But now, I came across the FPC’s decision of 20 May 2020 to close the proceedings because the parties have ultimately settled, after a series of suspensions of the further course of the proceedings after the main hearing.
Laurastar is bearing the court fees; no party compensations are awarded.
I understand that the so-called InstantSteam feature is still a major selling point of Innosteam, the efficiency of which purportedly allows for the commercialization of a high end ironing system at an affordable price.
As mentioned earlier on this Blog here, Werner & Mertz (well known e.g. for its brands Erdal® and Frosch®) has sued Compad Consulting GmbH for lack of entitlement to a patent application, i.e. unlawful usurpation thereof.
There had already been some attention in the media a while ago (see e.g. here and here), when the defendant had lodged a press release. Apparently, the plaintiff now also approached the media shortly before the hearing. SRF reported again about this case yesterday in Regionaljournal Zentralschweiz:
Frankly, I am not going to participate in reading the tea leafs here, trying to conclude something from the fact that the inventor has waived her right to be publicly mentioned; or that the applicant is not Good Soaps itself, but rather a consulting firm that has given a license to Good Soaps. These things per se may well happen for good and serious reasons. And I cannot readily spot any troll-like behaviour, either.
The main hearing took place earlier today, and it was definitely one worth attending.
Ms Regine SCHNEIDER had met with some people of Werner & Mertz on 27 August 2009 in Mainz, in particular with Mr Karl-Heinz QUADE. That is one of the few things on which the parties can agree. At that time, Ms SCHNEIDER had been employed by Kolb, as head of the business unit New Business. I understood from the pleadings that Ms SCHNEIDER had been decruited on the very next day, i.e. 28 August 2009, and that she was immediately released from work because Kolb closed down the whole business unit. Accordingly, it will be decisive whether the invention — as claimed in the application at stake, or at least the basic concept thereof — had been communicated by Mr QUADE to Ms SCHNEIDER in that meeting.
Evidently, the content of this single meeting is of critical importance. Since there is only very limited written evidence in this respect (only an agenda or invitation, in my understanding), witness testimony will likely be decisive. Accordingly, Ms SCHNEIDER was deposed as a witness today. To the best of my knowledge, this was actually the first time that a witness has been publicly deposed in a main hearing at the FPC. Ms SCHNEIDER was first deposed by the President and the judge-rapporteur, and both parties were given the opportunity to ask follow-up questions. This was actually a pretty smooth exercise.
But, maybe, Mr QUADE remembers things differently(?). Unfortunately, we did not learn more about this meeting from his perspective today. I understood from the pleadings that the defendant had pressed criminal charges against Mr QUADE, for some wrongdoing in connection with the present matter, and that he was therefore prevented from being deposed as a witness in the hearing today. The FPC has apparently initiated proceedings for judicial assistance of the German authorities, to have Mr QUADE deposed in Germany. Defendant’s counsel requested the FPC to reconsider this procedural move: Even if Mr QUADE would confirm all that has been asserted by the plaintiff by now, it would still not be sufficient for the plaintiff to fulfill all three criteria as outlined above. Note that judicial assistance might easily take a further 4-30(!) months.
The further course of the proceedings is not yet cast in stone. If the FPC abstains from having Mr QUADE deposed, the judgment would be issued as a next step. If Mr QUADE is being deposed, the parties will again have an opportunity to comment on his testimony, be it in writing or yet another hearing.
As reported by Christopher GILB in the Luzerner Zeitung today, there is some litigation going on at the FPC about entitlement to a European patent pertaining to a washing agent that is free from palm oil.
It appears that Werner & Mertz (well known e.g. for its brands Erdal® and Frosch®) has sued the Swiss start-up company Good Soaps for lack of entitlement to the patent, i.e. unlawful usurpation thereof.
We have reported about the main hearing on this Blog here ». From the pleadings at the hearing, I had expected a pretty straight-forward outcome. But when I had downloaded the decision, I panicked: 110 pages(!), a decision of epic length. When will I ever find time to read all this? But in the end it was not half as bad: One can thumb through more than half of the decision without missing much: It takes essentially the first 65(!) pages to recite the various requests of the parties during the proceedings.
Against the background of the pleadings at the main hearing, the conclusions of the decision indeed do not come as a big surprise anymore: EP(CH) 864 » is declared null and void; Bystronic’s further requests are dismissed, as well as Tomologic’s counterclaim for infringement. Appeal proceedings are currently pending at the Supreme Court.
Urteil vom 8. Mai 2020 i.S. Bystronic Laser AG v. Tomologic AB re Feststellung Nichtigkeit, Feststellung Mitinhaberschaft / Widerklage auf Verletzung: CH EP 2 485 864 B1 ist nichtig mangels Neuheit; im weiteren Umfang Klage und Widerklage abgewiesen; https://t.co/qZ689ocWuX
Now that the outcome is essentially in line with what we had learned in the main hearing », let’s have a look at some procedural aspects, and some issues of potentially more general interest.
Competency of the FPC
Competency of the FPC to hear all aspects of the case was not a given, since e.g. Bystronic had requested that foreign members of the patent families were assigned to co-ownership. It was only due to a Service Agreement between the parties, i.e. a choice of forum clause contained therein, that the FPC’s competency was acknowledged in toto.
Parties sometimes feel that the judge-rapporteur’s expert opinion should have dealt with yet further aspects of the case: Why didn’t he/she take a deep(er) dive? The decision holds that the parties do not have the right to have all the questions which might arise and which concern technical issues be dealt with in a specialised judge’s opinion; see ¶ 32. This is even more so in cases like the present one when more than 20 auxiliary requests are pending (which ultimately all failed for clarity issues and insufficiency of disclosure of a feature that was contained in all requests). It is at the judge-rapporteur’s discretion to make a reasonable choice of aspects to be dealt with in the expert opinion:
In general terms with respect to claim construction, the decision holds in ¶ 43 that a claim shall be read in such a way that the embodiments disclosed in the patent are literally covered. Applying this to the case at hand, the decision holds in ¶ 46, that one has to arrive at a certain conclusion since the embodiments disclosed in the specification must be covered (literally):
I have stumbled over the same wording several times in recent decisions of the FPC — and I am still not really comfy with it. My experience as a patent attorney is different: It frequently happens during prosecution that claims are amended in such a way that specific examples (only some or even all) disclosed in the specification are not covered anymore by the amended claim. Clearly, both the attorney and the examiner should spot and remove such inconsistencies before grant. But it just doesn’t happen, quite often.
By way of example, if a claim is amended during prosecution by specifying that a certain element is circular, and the patent as granted contains various embodiments of circular shape and still an embodiment where that element is rectangular, there is no way in my perception that circular in the claim should be construed such that it covers a rectangle.
On the other a hand, when the claim says round and the embodiments disclose only various polygons, chances are that polygons might well read on round(?). Subject to discussion, of course. But I feel that it is in no way a universal truth that a claim has to be construed in a way that it literally covers the disclosed embodiments, no matter what. Rather, it depends.
Accordingly, the German Supreme Court has held several times that the correct claim construction may well lead to a situation where only some or, in exceptional cases, even no embodiment at all is covered by the claim (see e.g. X ZR 43/13 – Rotorblätter (¶ 16) and X ZR 35/11 – Zugriffsrechte (¶ 26)):
Eine Auslegung des Patentanspruchs, die zur Folge hätte, dass keines der […] geschilderten Ausführungsbeispiele vom Gegenstand des Patents erfasst würde, kommt […] nur in Betracht, wenn andere Auslegungsmöglichkeiten, die zumindest zur Einbeziehung eines Teils der Ausführungsbeispiele führen, zwingend ausscheiden oder wenn sich aus dem Patentanspruch hinreichend deutliche Anhaltspunkte dafür entnehmen lassen, dass tatsächlich etwas beansprucht wird, das so weitgehend von der Beschreibung abweicht.
A claim construction which would have the consequence that none of the described embodiments would be covered by the patent is only possible if other ways of claim construction which lead to the coverage of at least some of the embodiments are definitely ruled out or if there are sufficiently clear indications from the patent claim that something is actually claimed which deviates so widely from the description.
What’s the threshold for someone’s contribution to be considered relevant enough to give rise to co-inventorship?
The decision holds in ¶ 62 that a co-inventor is someone who has participated creatively in the development of the invention. Mere workmanship is not sufficient to be a co-inventor, but it is not required that the contribution in itself is inventive or even that it fulfils the conditions for patentability in itself.
This example appears straight-forward to me. On the other side of the threshold, an input that is more than standard workmanship (or which is substantial; see ¶ 69) but not yet inventive in itself is sufficient for someone to be a co-inventor. Again, there may well be clear cases, e.g. when a car is claimed and the invention is all about an engine for the car, and someone only contributes to the subject-matter of the claim that the car has wheels (guess what!). But most cases won’t be this easy to decide.
On a sidenote, the decision also holds that the inventor has to be a human. Well, that is the current mainstream approach, see e.g. the EPO’s DABUS decisions and a recent report from the Five IP Offices:
But there are certainly AI-generated inventions around; see e.g. The Artificial Inventor Project, and it is a pity that the law — at least as it stands and as it is currently interpreted by the offices and courts(?) — deprives AI-generated inventions from patent protection. But the discussion about this and further AI-related aspects has only just begun.
On 5 February 2020 the main hearing in this matter took place at the FPC. We have reported on this matter already on 3 February 2017 when ex parte interim measures had been denied (see this Blog here) and on 26 May 2017 when EPO prosecution and opposition proceedings had been stayed (see this Blog here).
As an introductory remark, the presiding judge invited Tomologic to provide a translation of a Swedish decision that had been submitted earlier; unfortunately, it was not indicated in the hearing what that decision was all about. Even though Bystronic had not commented on that Swedish document, the court felt «not at ease» with having a document on file which is not comprehensible for the judges.
Both parties gave PPT presentations. The presiding judge reminded the parties that this case was already extraordinarily voluminous, even before oral pleadings, and that there was no need to repeat the assertions already made in writing.
Tomologic used flipchart sketches and short films in further support of the PPT presentation. In our perception, flipcharts are generally welcomed by the court. But how tho deal with the table-top microphone in such situations? Any drawer / presenter should be prepared to be reprimanded by the court clerk to use the microphone. Furthermore, flip chart collages, once they are completed, shall form part of the minutes and should not be re-arranged too heavily in later pleadings.
On the merits of the case, we understand that the judge-rapporteur’s expert opinion had been in favor of Bystronic, at least to the extent nullity of EP 864 is concerned. Claim 1 of EP 864 as granted reads as follows (underlined feature amended over claim 1 as originally filed; potentially distinguishing feature over the prior art highlighted in yellow):
Claim 1 of EP 864, marked-up
Method for machine cutting several parts out of a piece of material using a beam cutting technology, said method providing a set of controlling rules and variables for cutting two dimensional shapes or patterns, where one rule or a combination of several rules are used for the cutting operation depending on the shape or pattern to be cut, said shape or pattern forming said parts out of said piece of material, characterised in that said set of controlling rules comprises rules for the forming of a cluster of parts with free form shapes, said parts being positioned so close to each other so that only the thickness of one cut made by the cutting beam is found between adjacent parts whenever the shape of said parts allows it.
It appears that the introduction of «one cut made by» may have caused an issue under Art. 123(2) EPC. Further, the correct understanding of (rules for the forming of a cluster of parts with) «free form shapes» in the characterizing part of the claim was a big issue in the hearing. In Tomologic’s view, this was a reference to «free form nesting». Free form nesting is a technique which — in contrast to «rectangular nesting» or «rectangular bounding box nesting» — arranges free form parts in a space-saving manner, based on perimeter segments rather than outer perimeter boxes.
In a nutshell, Tomologic held that the claim requires forming of a cluster by means of free from nesting. On the contrary, Bystronic held that it could only be the parts themselves which have a free from shape, without any indication whatsoever of the envisaged nesting technique. It is our understanding that only according to Tomologic’s interpretation, the respective claim feature might potentially constitute a differentiating feature over so-called rectangular nesting. At this point of the hearing, the linguistic discussion about English grammar was quite intense. Bystronic explained the difference by way of a «baking dilemma», i.e. that «baking products with yeast» is not necessarily the same as «products baked with yeast»; the term «with» could not be construed as «by means of» at will.
We understood that the expert opinion had apparently held that the feature as claimed is not much of a limitation, and that it does in particular not exclude rectangular clustering; see e.g. ¶  of EP 864 in this respect:
It has been referred in the pleadings re (lack of) novelty to JP H09-285886 (D1, also available as EN translation) and a further document called «Rao» (likely Rao et al., Int J Adv Manuf Tenchnol (2007) 33: 436-448; available here). Further, it was referred to the publication «Faszination Blech» (you cannot make this up).
We conclude from the pleadings that the above issues had likely not been resolved by Tomologic’s auxiliary request(s) to maintain and assert EP 864 in amended / limited form. Rather, the auxiliary request(s) occasioned further issues re clarity and, maybe, enablement.
Interestingly, Bystronic had initially requested a declaratory judgement of non-infringement; see p 1-9 of the complaint as filed and the FPC’s letter of 16 January 2017:
We conclude from the pleadings that the court might have (partially?) not considered this request for declaratory judgement, but this remains to be confirmed in the final judgement.
The pleadings further circled around Bystronic’s alleged contribution to the subject-matter of EP 864, as the basis for the requested assignment to co-ownership. Note that Bystronic had initially requested assignment to co-ownership for the whole patent family of EP 864, as well as the patent family of WO 2012/136262 A1.
The value in dispute was indicated as 2m CHF for the main claim and 1m CHF for the counterclaim. Actual costs incurred by the parties apparently by far exceed the refundable amounts according to the tariff.
The parties finally agreed to have settlement discussions.
We had reported about the main hearing in this matter on this Blog here.
The patent in suit is CH 707 572 B1; see Swissreg for further bibliographic information. An automated translation can be found here. Harcane Sàrl had sued Comadur essentially to the effect that CH’572 be declared invalid (based on Art. 261(1) lit. a PatA, not lit. d); or, alternatively, if CH’572 was held valid, that it be transfered to Harcane Sàrl. On the other hand, Comadur finally defended CH’572 with the claims being limited. Further, Comadur requested that Harcane Sàrl’s complaint should be held inadmissible.
Parallel proceedings elsewhere
It is a procedural requirement that the case is not the subject of pending proceedings elsewhere or is not already the subject of a legally binding decision; Art. 59(2) lit. d and e CPC.
There had been co-pending proceedings in Neuchâtel where Comadur had sued Harcane Sàrl and sought for a delaratory judgment based on the Unfair Competition Act that it was the owner of certain manufacturing processes of ceramic injection molding (CIM) material. In turn, Harcane Sàrl saught a declaratory judgment in proceedings in Neuchâtel that Harcane Sàrl was the owner of the respective trade secrets relating to the CIM material.
Obviously, these requests differ from the requests in proceedings at the FPC. Thus, the case that has been brought before the FPC had not been the subject of pending proceedings elsewhere. Still, the FPC had stayed its proceedings on 28 May 2018 since certain preliminary questions overlapped with the cantonal proceedings. The stay was lifted on 13 February 2019, i.e. shortly after the Supreme Court had decided on both parties’ appeals against the decision of the Neuchâtel cantonal court; see 4A_584/2017, 4A_590/2017 of 9 January 2019.
Décision du 27 juin 2019 dans la cause Harcane Sàrl c. Comadur SA re. nullité, cession du brevet CH 707 572 : pas d’exception de jugement entré en force; action rejetée, mais répartition égale des frais en raison de la limitation substantielle du brevet, https://t.co/AYbprDpQyK
The decision holds in ¶21 that the plaintiff well has a legitimate interest in bringing the present complaint since, according to the prior cantonal proceedings, Harcane Sàrl is only prohibited to use some very specific embodiments of the patent in suit. However, even the limited scope of CH’572 goes far beyond that.
limitation of the patent
The defendant / patentee partially surrendered CH’572 in accordance with Art. 24(1) lit. c PatA and declared the same to the FPC; see O2012_030, ¶17.
Claim 1 as amended reads as follows:
Claim 1 as amended
Liant pour composition de moulage par injection comprenant :
de 35 à 54% vol. d’une base polymérique
de 40 à 55% vol. d’un mélange de cires,
et environ 10% vol. d’un surfactant,
dans lequel la base polymérique contient des copolymères d’éthylène et d’acide méthacrylique ou acrylique, ou des copolymères d’éthylène et d’acétate de vinyle, ou des copolymères d’éthylène comprenant un anhydride maléique ou un mélange de ces copolymères, ainsi que du polyéthylène, du polypropylène et une résine acrylique, et dans lequel lesdits copolymères sont des copolymères d’éthylène et d’acide méthacrylique ou acrylique, ou des copolymères d’éthylène comprenant un anhydride maléique ou un mélange de ces copolymères;
à l’exclusion d’un liant pour composition de moulage par injection comprenant de 35 à 50% vol d’une base polymérique, de 40 à 55 % vol d’un mélange de cires, et environ 10% vol d’un surfactant, dans lequel la base polymérique contient des copolymères d’éthylène et d’acide méthacrylique ou acrylique, ou des copolymères d’éthylène et d’acétate de vinyle, ou des copolymères d’éthylène comprenant un anhydride maléique ou un mélange de ces copolymères, ainsi que du polyéthylène, du polypropylène et une résine acrylique.
The underlined / italic part of the claim is a so-called undisclosed disclaimer to exclude the subject-matter of CH 708 097 A2, a prior right that had been filed earlier but published only after the filing date of CH’572. As much as I recall, this is the first time that such an undisclosed disclaimer has been at stake and allowed in proceedings at the FPC. Note, however, that O2012_030 in ¶20.1 already suggested that the FPC would follow the EPO’s precedent G 1/03.
Dependent claims 2-6 remain unchanged. Claims 7-10 have been deleted.
Apparently, the court did not appreciate how the novelty attacks had been presented. The decision holds that, according to common practice, a specific analysis of the features of the claim and a specific reference to the prior art has to be made, for each of the features. It is not the court’s task to establish the facts of its own motion and to seek the information in the references filed as exhibits. On the contrary, the relevant facts must be alleged by providing specific information, in particular by reference to a page or line number, while specifying which feature of the claim is there to be found (see ¶¶28-30).
Le Tribunal n’est pas chargé d’établir les faits d’office et il ne lui incombe pas de rechercher lui-même les informations dans les documents de l’art antérieur déposés en tant que pièce jointe. En particulier, une référence globale à un document dans le sens de «l’objet de la revendication 1 est divulgué dans le document X» ne suffit pas pour satisfaire au fardeau de l’allégation. Il faut au contraire alléguer les faits pertinents en fournissant des indications spécifiques, notamment par renvoi à un numéro de page, de ligne, tout en précisant quelle caractéristique de la revendication se retrouve dans le document de l’état de la technique invoqué.
In the absence of any specific allegations, the FPC did not consider the novelty attacks to the extent they were based on prior art documents. What remained was the sale of a certain feedstock to Comadur. However, the decision holds that these sales were governed by an NDA and thus cannot be considered at all. Further sales to third parties had been alleged but remained essentially unsubstantiated.
Accordingly, novelty was acknowledged.
The FPC did not appreciate the way the obviousness attacks had been presented, either. The decision holds that the FPC cannot complete an incomplete factual allegations of the parties. This is in contrast to proceedings at the EPO which shall examine the facts of its own motion and which shall not be restricted in this examination to the facts, evidence and arguments provided by the parties and the relief sought; Art. 114(1) EPC. Determining whether an invention is based on an inventive step is a question of law. However, the general technical knowledge of the skilled person, the closest prior art, the differentiating features, etc. are facts, and it is up to the parties to allege these facts (see ¶37).
In my perception, the considerations with respect to the burden / degree of substantiation are what this decision will likely be cited for in the future.
To the extent the FPC admitted the plaintiff’s arguments and evidence into the proceedings at all, the decision holds that the claimed subject-matter was not obvious over US 5,266,264.
Even though the plaintiff did not succeed with any request, the defendant was still charged with half of the court fee since the patent was maintained only to a limited extent, i.e. the defendant partially acknowledged the plaintiff’s complaint and both parties win and therefore lose equally.
No compensation for legal represenatation was awarded.
Interestingly, the plaintiff only involved a patent attorney when the expert opinion of the judge-rapporteur had been established. The respective expenses were not considered necessary anymore since the closure of the file had already occured at that time. On the other hand, defendant’s expenses for the assisting patent attorney of ICB, a company within the Swatch group of companies, had not been considered, either: No intra-group expenses are reimbursed; see O2014_009, ¶6.2.
UPDATE 9 September 2019:
The decision has been appealed to the Supreme Court.
These two decisions in summary proceedings are heavily redacted — which is an exception to the rule. Obviously, the overall conflict between the parties also involves some criminal allegations against a natural person (Art. 146 CC; fraud).
In view of the criminal allegations I am not going to engage in any de-anonymisation exercise here; and this post is not open for comments, either.
A register ban for six Swiss patent applications had been issued by the public prosecutor of the Canton of Fribourg on 22 May 2017, in view of the criminal charge. The public prosecutor informed the plainfiff on 21 November 2018 of the deadline for finally lodging civil proceedings, i.e. 31 January 2019, and indicated that sequestration of the six patent applications would be lifted at that date (however, this apparently had not happened).
The plaintiff indeed initiated civil proceedings, but only on the very last day of the time limit, and only in summary proceedings. In particular, issuance of a register ban had been requested without hearing the defendant beforehand.
While the President acting as single judge appreciated the risk that the six patent applications might be transferred to defendant (3) in view of some prior conduct of the defendant(s), and even though particular urgency was acknowledged, he did not order a register ban ex parte. The President held that the urgency is exclusively due to the late submission of the request by the plaintiff who should have taken action swiftly after the public prosecutor’s notification of 21 November 2108. If the plaintiff had filed the request in a timely manner, i.e. in early December 2018, the defendants would have had sufficient time to take a position on the request. The President held that the defendants cannot be deprived of their constitutional right to be heard because of the plaintiff’s belated action. The decision refers in passing to S2018_002, ¶7, for that a delay of two months results in the rejection of the request in any event.
The request for issuance of interim measures without hearing the defendant beforehand was thus denied with decision of 6 February 2019.
However, the register ban had still been issued with decision of 11 July 2019. In balancing the potential disadvantages suffered by the plaintiff and the defendants, the President (again acting as single judge) concluded that there was a much greater potential damage that the plaintiff would suffer if the register ban would not be issued, compared with the defendants potential damage if the register ban was granted. Nevertheless, the decision clearly notes that it is highly doubtful that the six patent applications had been contractually assigned to the plaintiff. Still, the fact that defendants (1) and (2) had previously attempted to assign the patent application to defendant (3), which is a mailbox company in Luxembourg, played out to the plaintiffs advantage, for the time being.
UPDATE 22 August 2019:
The decision of 11 July 2019 has not been appealed / is now final.
Laurastar and Innosteam are litigating about ownership of two PCT applications, WO 2018/006994 A1 and WO 2018/036653 A1; see the EPO Register here and here. The patent applications are about devices and methods for producing instant steam (WO’994) and instant hot water (WO’653), for use e.g. in devices for ironing.
Briefly, plaintiff alleges that the subject matter of both PCT applications had been invented by the inventors in fulfillment of their contractual duties while they were employees of Laurastar.
We have reported on this Blog here about the provisional register ban that had been issued without hearing the defendant beforehand, and the subsequent hearing. The register ban had finally been maintained in summary proceedings S2018_003; see this Blog here.
Note that both PCT applications have meanwhile been nationalized inter alia at the EPO, but the EPO has stayed its proceedings on request of Laurastar SA pursuant to R. 14(1) EPC while main proceedings at the FPC are pending; see here (re WO’693) and here (re WO’994). It is still (too) early to obtain full and complete information about the status of nationalization elsewhere in the world, but WIPO’s PatentScope indicates further nationalizations in the Ukraine and the Russian Federation; see here (re WO’653) and here (re WO’994). Anyway, we could now catch a glimpse of what is going on in main proceedings O2018_016 at the hearing on June 25, 2019 in Neuchâtel. The hearing was held in French language — well, at least the most of it.
Plaintiff’s pleadings emphasized that the invention was conceived before the inventors left Laurastar SA to work for Innosteam Swiss SA. A significant part of the argument evolved around a document created by Mr. Pasche that allegedly shows all the features of the patent applications in question (hereinafter refered to as ‘Pasche’):
But even if there were any potential differences between Pasche and the two patent applications, they were only of minor importance and could not render the claimed subject-matter inventive. And, in the plaintiff’s view, this has to be taken into account; else, one could just steal an invention, add an insignificant feature to it and be unassailable.
Plaintiff further questioned to what extent a detailed claim analysis, as apparently done by the judge rapporteur, was appropriate. In the plaintiff’s view, the claims are still subject to change and do not necessarily represent the invention as a whole. For this reason, according to the plaintiff, the judge rapporteur should have analyzed the description as well. In addition, plaintiff argued that the inventiveness of the subject matter over Pasche should have been analyzed as well.
Defendant, by contrast, argued that the subject-matter outlined in Pasche was free state of the art, in any event. Thus, even if it showed all the features of the patent applications in question, just for the sake of argument, it could not be proprietary to Laurastar SA or anybody else. This led to some discussion about the term ‘invention’: Does it imply non-obviousness over the prior art, i.e. an inventive step? It has been argued that under the Swiss Code of Obligations (Art. 332), an invention does not require an inventive step (emphasis added):
Inventions and designs produced by the employee alone or in collaboration with others in the course of his work for the employer and in performance of his contractual obligations belong to the employer, whether or not they may be protected.
A decision on these issues might be an interesting read — if the parties haven’t settled.
On the procedural side, the hearing was quite illustrative of Switzerland:
Defendant’s representative started his pleadings with reference to the federalism in Switzerland and explained that he was going to structure his pleadings according to what is customary in Geneva. This may have contributed to some confusion that arose after a (brief) first part of defendant’s pleadings. Defendant’s representative sat back down, and the President asked if he was done, which the representative affirmed. The president then firmly told the parties that the time to make arguments was now:
Le temps de répondre, c’est maintenant!
This prompted defendant’s councel to get back up again and finish his pleadings. The assisting patent attorney then added his share to the pleadings — in German language. This was apparently not appreciated by everybody in the room, and the opposing patent attorney could not help himself but leave a snarky remark about this in his own pleadings later.
I wonder whether I should better immediately refresh my French and learn some Italian, just to be prepared for some spontaneous pleadings in a language that hasn’t been announced beforehand(?). (Just kidding) /MW
At the end of the hearing, the President asked whether the parties were interested in settlement talks. Both parties gave answers along the same lines, saying that in principle they would of course be interested in a settlement. However, neither party found it realistic to find a mutually agreeable compromise since a joint assignment of the patent applications was not desirable to either party. Thus, according to both parties, settlement negotiations were pointless.
The President buried the face in his hands and, after a sigh, explained to the parties in German (‘Erlauben Sie mir, das auf Deutsch zu sagen’) that it was conceivable that a judgment could give exactly that result: Joint ownership. Such a forced marriage may not facilitate things for either party and the President gently reminded both parties that a settlement may well be the better course of action.
The parties asked for a short break to discuss the President’s comment, after which it was discussed non-publicly whether the parties may be willing to settle after all.
Both parties had lodged an appeal — but the Supreme Court dismissed both appeals. While the FPC’s judgement was quite a booklet of 50+ pages, it took the Supreme Court only 7 pages to deal with both appeals. Most of the judgment indeed is pretty straight forward. Still, the judgment has quite some interesting aspects, in my perception:
Assignment of a patent does not imply assignment of the universal right to the invention per se
Guenat had requested that Swiss Finest‘s Swiss patent be annulled based on Art. 26(1) lit. d PatA, i.e. for lack of entitlement. However, such request can only be brought by the entitled person; Art. 28 PatA. Guenat alleged that Frédéric Garinaud transferred ‘full and complete ownership’ of the European patent application to Guenat. But that did not help. Frédéric Garinaud specifically assigned the European patent application to Guenat, but not the universal rights in the ‘invention’ itself. Guenat’s request for declaration of nullity based on Art. 26(1) lit. d PatA was thus held inadmissible for lack of standing.
On appeal, Guenat criticises the FPC’s ‘artificial dichotomy’ between the invention and the related patent application, and claims complete control over the invention in dispute. The Supreme Court didn’t buy into that. The decision holds in ¶3.2 that Guenat’s argument is based on an assumption about the parties’ intention in respect of the transfer agreement of April 2013. This is not a question of law, but of fact. But the FPC had not found that the real and common intention the parties had been to assign all intellectual property rights to the invention and the right to be granted all related patents. On the contrary, according to the FPC, the agreement in question ‘clearly refers only to the European patent application and the resulting European patent, and not to the invention as such’ — which finding is binding on the Supreme Court since it is not ‘arbitrary.’
Thus, the Supreme Court apparently had no doubt that the assignment of a specific patent does not necessarily imply the assignment of the universal rights in the invention itself.
Assessment of inventive step is a question of law, but …
Guenat argued on appeal that the FPC had violated the principle of party disposition because it took facts into account that had not been alleged by the defendant.
Now, what had happened?
The FPC had held that a specific feature (C3-1) was not disclosed in the closest prior art document. Guenat had a different understanding of the specific feature, and had argued that based on a ‘correct’ understanding of the feature it had well been disclosed in the closest prior art.
On appeal, Guenat argued that Swiss Finest had not even alleged that feature C3-1 was not disclosed in that document. Unfortunately, it is not readily clear from the decision to which version of feature C3-1 that allegation pertained: The feature as construed by the Guenat, or the feature as construed by the FPC?
The Supreme Court held that it had not been disputed that all the factual elements necessary for the analysis of obviousness had been brought on file by the parties. Further, the Supreme Court held that Guenat had not asserted that the FPC had to supplement the facts on its own, and that such conduct was also not apparent from the file. In the Supreme Court’s view, the FPC was thus in a position to assess obviousness, which is a question of law. It is irrelevant in this respect that the presence or absence of specific features in the prior art and/or the patent have been alleged by the defendant or the plaintiff. On the basis of the facts gathered by the parties in order to consider a question of law, the court did not violate the principle of party disposition.
Without any in-depth knowledge of what had or had not been argued by the parties, I just cannot say whether I would agree with the assessment on the merits of the case. But the Supreme Court’s general considerations on questions of law vs. questions of fact trigger some further thoughts.
Clearly, assessment of obviousness is a question of law — but the underlying factual elements still need to be asserted by the parties. But what are the ‘factual elements’? They must be something more specific than just ‘the patent in suit’, ‘D1’ or the like. Else, a court could just combine whatever is on file in its assessment of obviousness, fully detached from the pleadings. This cannot be it. Now, let’s assume that both parties come up with a somewhat strange claim construction, and base all their obviousness attacks / defenses on a wrongly construed claim. In my understanding, claim construction clearly is a question of law, too (see e.g. X ZR 255/01 – ‘Bodenseitige Vereinzelungseinrichtung’ of the German Federal Supreme Court in ¶5, with further reference). But what if no party ever pointed to the relevant underlying ‘factual elements’ (i.e. specific sections of the patent in suit) that support the ‘correct’ claim construction? May the court then even come up with a different / the ‘correct’ claim construction at all?
UPDATE 21 March 2019:
Note that the FPC had held in the recent decision S2018_006 that claim construction is a question of law. In that case, both parties had not construed the feature in question at all, and the FPC came up with a construction on its own:
Wie der Begriff korrekt auszulegen ist, tragen die Beklagten hingegen ebenso wenig wie die Klägerin vor. Da die Auslegung des Patentanspruchs eine Rechtsfrage ist,15 geht die Annahme der Beklagten fehl, das Gericht dürfe den Anspruch mangels entsprechenden Vortrags der Klägerin nicht so auslegen, dass er auch etwas anderes als einen Schneidprozess erfasst.
But, again, what if both parties came up with a claim construction mutually agreed upon — but which, in the courts view, is just wrong? Or, what if both parties come up with different constructions which are both wrong in the court’s view? Can the court then correct such (a) construction(s) if it would have to rely on ‘factual elements’ that have never been pointed at by the parties, just because it is a question of law? And if that was the case, then where is the limit in the assessment of obviousness — which is a question of law, too?
The theory of separating questions of law from questions of fact is simple. But life is complicated …
On a sidenote: Wouldn’t it be good to establish common ground on what the claim actually is all about before diving any deeper? This is what a Markman hearing in the U.S. is all about. Even though I am not overly enthusiastic about quite some aspects of patent litigation in the U.S., this one certainly is useful.
I had reported about the ownership dispute in summary proceedings between between David Bensoussan and Rock dental AG on this Blog here.
Except for the complaint, nothing had surfaced in main proceedings O2017_026, though. See the full complaint below. I now came across an order that had been issued on 11 September 2018: The parties apparently found an amicable solution. The order had not been published by the FPC, but the terms agreed upon by the parties do not contain any confidentiality obligation. It is rare that one can catch a glimpse of how cases are settled at the FPC: The full order is available in the file wrapper at the EPO in relation to the European phase of the patent application concerned. In brief, the parties agreed as follows:
Marc Fehlmann and David Bensoussan are joint inventors.
Rock dental AG shall be the sole owner of the patent applications / patents.
David Bensoussan shall be reimbursed for assignment of his share of rights in the patent applications / patents with a 20% share of the license income.
As a result of the settlement, case O2017_026 was written off as settled.
Note that Hepp Wenger Ryffel is involved in this matter on behalf of the plaintiff / appellant.
Please see this Blog here for a discussion of the underlying decision of the FPC. In brief, it is all about an assignment action of Marcel Riendeau against Zehnder Group International AG, concerning two European patent applications, i.e.:
Both EP2 and EP3 had been filed in Zehnder’s name only; the plaintiff had been designated as inventor. The plaintiff had partially suceeded in first instance when the FPC held that the parties are jointly entitled to both patent applications.
On appeal, the plaintiff objected that the facts had been wrongly established in the first instance decision in various aspects, that the burden of proof had been incorrectly allocated and that the FPC had not dealt with the plaintiff’s entitlement to a transfer of the patent applications based on a contractual undertaking.
To cut a long(er) story short: The Supreme Court did not agree and dismissed the appeal. The FPC’s decision is thus final now, and it remains to be seen how the parties get along with their joint entitlement to both EP2 and EP3.
Laurastar and Innosteam are litigating about ownership of two PCT applications, i.e. WO 2018/006994 A1 and WO 2018/036653 A1; see the EPO Register here and here. The patent applications are about devices and methods for producing instant steam (WO’994) and instant hot water (WO’653), for use e.g. in devices for ironing.
We have reported on this Blog here about the provisional register ban that had been issued without hearing the defendant beforehand, and the subsequent hearing.
The main disagreement between the parties relates to the relevant time period in which the inventions had been made: While Laurastar alleges that the inventions had been made by Mr. Mantegazzi and Mr. Pasche when they had been employed by Laurastar, defendant submits that the inventions had only been made thereafter, i.e. when Mr. Mantegazzi and Mr. Pasche have been employed by the defendant.
Plaintiff inter alia relied on the following document that was undisputedly created by Mr. Pasche during his employment with the plaintiff:
In a nutshell, the present decision maintains the register ban while main proceedings are pending, to sort out the ownership dispute. And this might turn out to be a tricky exercise: The decision provisionally holds that the subject-matter of
claims 1, 5, 7, 8, 9, 11 (first and second option), 22 and 23 of WO’994
had likely already been invented by the two inventors when they had been employed by the plaintiff, in fulfilment of their contractual duties. Rights in these aspects would reside with the plaintiff; Art. 332(1) CO. The two PCT applications may thus have to be partially assigned to the plaintiff (Art. 29(1) PatA) — but only in main proceedings. This co-ownership would be kind of a forced marriage. If it doesn’t work out in practice and the parties get divorced, it will be hard to cut out and reshuffle the respective shares in the inventions.
Now, how to proceed with the two PCT applications in the meantime? They need to be nationalized in early 2019, and a decision in main proceedings is unlikely to be final by then. The decision unmistakably holds that it will be up to the plaintiff to decide how to best protect his interests in this respect:
On ne saurait manifestement condamner la défenderesse à entrer dans les phases nationales dans tous les Etats contractants du PCT, car cela pourrait se révéler prohibitif. Il appartiendra à la demanderesse de décider comment sauvegarder ses intérêts une fois que le délai d’entrée dans les phases nationales approchera de sa fin, ce qui semble être le 5 janvier 2019 (pour WO’994) respectivement le 24 février 2019 (pour WO’653).
It is clearly not possible to order the defendant to enter the national phases in all the contracting states of the PCT, as this could be prohibitive. It will be up to the plaintiff to decide how to safeguard its interests once the deadline for entry into the national phases approaches its end, which appears to be 5 January 2019 (for WO’994) and 24 February 2019 (for WO’653), respectively.
I am very much looking forward to see how this finally unfolds. The immanent time pressure requires some creativity to ensure that no rights in at least the most relevant designated states are lost.
On the procedural side, it is worthwile to note how the FPC dealt with a document that had been submitted by the defendant that contained additional technical data. The defendant requested that this information shall be considered by the court, but not being handed over to the plaintiff. The court held that either a redacted copy shall be submitted that can be provided to the plaintiff, or the defendant shall agree to have the unredacted version provided to the plaintiff’s attorney and patent attorney, for attorney’s-eyes-only and under threat of sanctions according to Art. 292 CC. The defendant chose to not agree to any of these options. Thus, the court did not take this additional document into account at all.
UPDATE 10 October 2018:
No appeal has been filed; the decision in summary proceedings has become final; main proceedings pending.
Décisions du 20 avril et 24 août 2018 dans la cause de Laurastar SA c. Innosteam Swiss SA re mesures (super)provisionelles : interdiction de disposer des demandes de brevets WO2018/006994 et WO2018/036653 pendant la durée du procès au fond, https://t.co/DA3B5nIdn3