Two from the Court of Appeal; Three from Chanel

Knives out for hindsight

In Ferag AG v Muller Martini Ltd [2007] EWCA Civ 15, here on BAILII, the Court of Appeal for England and Wales gave its ruling yesterday on a tricky question relating to hindsight when viewing the prior art. This was an appeal by Ferag against a ruling (see earlier IPKat post here) that its patent was not valid, being obvious, and was not therefore infringed by Muller's Newstrim machine. Muller cross-appealed against the finding that the patent was not also anticipated by prior art.

Claim one was for a method of cutting or trimming continuously conveyed, multilayered printed products in a continuous process in which at least one first knife part was jointly associated with a printed product and at least one first knife part and the printed product were moved at substantially the same velocity, being engaged with one another along at least one cutting edge, with the inventive result that the first knife part and the associated product were moved past a second fixed knife part to be brought into cutting engagement so that the printed product was at least cut along an intended cutting edge. At trial, Mr Justice Lewison held that the word "associated" in claim one required a physical association between the knife part and the printed product, that the association had to last longer than the mere moment of cutting; the essential difference between Ferag's invention and the Newstrim was that the counterknife in Muller's machine did not travel with the printed product but was conveyed by a separate clamp. This invention, he held, was new but nonetheless invalid for obviousness. On appeal, Ferag submitted that no actual physical contact between the knife part and the print product was required by claim one: all that was required was that the first knife be allocated to a particular product as being one of the knife parts destined to cut it.

The Court of Appeal (Lords Justices Mummery, Tuckey and Jacob) allowed Ferag's appeal. In their view
* The 'association' between the first knife and a printed product in claim one was that, during the cutting process, a knife part that was to cut a printed product was allocated to the product and the association had to continue until after the cut. There had to be a period during which the first knife part and the printed product moved at substantially the same velocity and engaged with one another along at least one cutting edge - but that was exactly what the Newstrim did before the moment of cutting. Newstrim accordingly infringed claim one.

* Lewison J was correct to say that Ferag's invention had not been anticipated by the prior art, but he still failed to appreciate that there were more differences between claim one and the prior art than he had spotted. The prior art disclosed a single-knife system rather a two-knife system, and it produced U-shaped trimmings that at best would be a nuisance to get rid of. Unlike Ferag's invention, the prior art did not address the problem of keeping the trimmer up with the speed of delivery from the printer and binder. It was thus unlikely to interest a skilled man concerned with high speed trimming.

* This being so, the person skilled in the art would need a lot of hindsight to start from the prior art and make such variations as would bring it within claim one.
The IPKat (who thought the trial judge's reasoning pretty convincing when he first read it) has vague misgivings about cases like this. The degree of hindsight that is needed is inevitably a matter of evidence rather than law, and it cannot be said with firm conviction that anyone looking at the prior art would (or would not) have drawn a conclusion as to its utility that would have given him the information he needed in order to make the invention covered by a subsequent patent. Can it be said that Lewison J's original finding was so untenable that no reasonable judge could have reached it? Merpel says, but isn't the whole of IP law a set of hindsight responses?

Getting to the Point

A second Court of Appeal ruling posted on BAILII yesterday is Point Solutions Ltd v Focus Solutions Ltd and another [2007] EWCA Civ 14, where a completely different panel of judges (Chadwick, Hallett LJJ and Lindsay J) dismissed Point's appeal against the decision of the trial judge (Judge Frances Kirkham) that it had failed to prove, on the balance of probabilities, that all of the individual literary works comprising its software product had been created without copying or adaptation from any corresponding part of the Focus's product.

The background to the Court of Appeal decision is as follows. Point carried on business as a provider of computer software for the creation and use of electronic application forms in the financial services sector, in which Focus was the dominant software supplier. Under an outsourcing agreement Point took on work for Focus and had access to some of its software products. After termination of this arrangement, Focus asked Point to confirm that it had not used any Focus software in developing its own products. Point denied any copying and offered to make voluntary disclosure to a mutually agreed independent expert, at Focus's expense. Although the parties took steps towards doing this, Point decided that Focus had been procrastinating and went to court, seeking a declaration of non-infringement. Focus was unhappy about this, saying that it had insufficient evidence from which to conclude that Focus's software infringed or not.

The parties having agreed to go to trial without any expert evidence, the judge held that Point had failed to discharge the burden of showing on the balance of probabilities that its software was of independent design. Point appealed.

The Court of Appeal, dismissing Point's appeal, said as follows:
* Judge Kirkham was entitled to take the view, for the reasons she gave, that she should treat the evidence of Point's two main witnesses with caution since she could not be confident that they had presented a full and accurate picture. She was also entitled to conclude that Point had not proved on the balance of probabilities that all its software, whether written by Point or by sub-contractors, was created without copying or adapting any corresponding part of Focus's product.

* Point had not identified all those who had worked on the software and had not called them to give evidence. Nor was there any evidence from some of the people involved in the development of its product. While there was evidence that the contribution of those sub-contractors was substantial, no evidence was offered as to their access to Focus's software.

* By agreement between the parties, there had been no evidence to assist the judge to decide whether the software was written in different languages which would make it difficult or pointless to attempt copying or whether knowledge of the structure of Focus's product could or would be of use as a springboard in the development of P's products.
The IPKat, who is very interested in the availability of declaratory relief for non-infringement (see post here), notes how important it is to sort out the evidential issues before even considering seeking declaratory relief. There is no general presumption of non-infringement that Point can rely on. Merpel adds, with improved hindsight, this is the sort of horrid little dispute that can be eliminated by making specific provision for it in the outsourcing agreement.

Onion smells new Chanel ploy

On of the IPKat's favourite fun-reads, satirical site The Onion, has just conjured up another brand-related spoof. It reads, in relevant part:
"Fashion house and perfumer Chanel, famed for its iconic, $300-an-ounce No. 5 scent, announced that it has created a cost-efficient fragrance for the Third World, one specifically designed for the rigors of dry, dusty, less glamorous environments in the Southern Hemisphere.

"Smelling positively bewitching should be the right of everyone, not just a privileged few", said Chanel CEO Maureen Chiquet at the gala launch for the new scent, Chanel 3rd, in Paris' Centre Georges Pompidou Monday. "It is our hope and belief that this new fragrance will bring much-needed panache to the Third World."

Chiquet said 3rd marks Chanel's first-ever attempt to appeal to a low- or no-income consumer market, and is part of the fashion world's desire to "give something back" to developing countries that have offered much in the way of photo-shoot locales and labor outsourcing. After six years of trial and error, Chanel's 17-member development team was able to bring the perfume's cost down to a more affordable $100-an-ounce. [...]

As for 3rd's scent, Chanel wanted something "clean, youthful, and beguiling," said Chanel chemist Robert Geneau, adding that organically musky, smoky, and earthy tones had been rejected because the scent's intended users most likely had too much musk, earth, and smoke in their lives already. "3rd has a bright, grassy base, like a fresh breeze after a rain—a very exotic scent for our target customer. There are also notes of cocoa, citrus, spices, and other things our customer sometimes raises and harvests for foreign export, but rarely gets to savor herself. Captivating, and for a fraction of the cost of high-end scents available in the West, 3rd is just the economic miracle developing nations need.

The genius of 3rd, Chiquet said, is how "it can go from hut to field to fire circle without losing its potency or charm.[...]".
The IPKat greatly appreciates the way that pieces such as this can focus on the sometimes quite absurd pretensions of brand-oriented consumption. Merpel says, are you sure you'd be chuckling so much if it was your brand?
Two from the Court of Appeal; Three from Chanel Two from the Court of Appeal; Three from Chanel Reviewed by Jeremy on Wednesday, January 24, 2007 Rating: 5

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