Carpmaels & Ransford sued for missed appeal deadline

One of the UK's leading patent attorney firms is facing a claim brought by their client, chemical company BASF.  BASF is suing Carpmaels for a reported €1.05 billion, because of a missed EPO appeal deadline. Whilst the court proceedings are ongoing, some interesting background to the case can be found in arguments made by Carpmaels in the request for re-establishment of the appeal deadline. The EPO was characteristically unsympathetic in its decision on the request for re-establishment.  The Board of Appeal decision cataloguing the actions leading up to the missed deadline makes for some tough reading for any patent attorney wishing to sleep soundly at night. 

Case Background

BASF is a German multinational chemical company, with a revenue of nearly 60 billion euros. The patent in question (EP1663458) related to a filter for diesel emissions. The granted patent was successfully opposed by rivals Johnson Matthey and Umicore, and revoked in its entirety at opposition in 2012. 

The deadline for filing the Notice of Appeal was 2 months after notification of the opposition decision (Article 108 EPC). Carpmaels submitted a Notice of Appeal on behalf of BASF after this deadline, together with a request for re-establishment of rights.  

The EPO has stringent criteria for allowing requests for re-establishment. Re-establishment requires a party to show that they used "all due care" to meet the relevant deadline (Article 122(1) EPC) (IPKat). The requirement for "all due care" to have been shown applies to the applicant/patentee, their representative, and even none European patent agents (IPKat). For the "all due care" requirement to be fulfilled, patent attorney firms must show that the failure to meet a deadline was as a result of an isolated mistake in an otherwise well-functioning system (Case Law of the Boards of Appeal, III-E-5.4).

A "whole series of failures and mistakes"

The request for re-establishment was submitted by the Carpmaels patent attorney responsible for the case. The patent attorney had been a partner at Carpmaels for over quarter of a century, during which it was submitted, he "had never missed a due date for filing a Notice of Appeal or any other critical deadline before the EPO". Shortly before the incident with the appeal deadline, the patent attorney had retired. To manage the hand-over of work, the attorney continued to take some responsibility for a certain number of cases as a consultant and only visited the office occasionally. 

Stapling

Carpmaels argued that the missing of the appeal deadline was an isolated error in an otherwise "extremely reliable system". The EPO sent the minutes of oral proceedings and the revocation decision relating to the case stapled together, with the minutes of oral proceedings in front. Importantly, it is the revocation decision that sets the appeal deadline, not the minutes of oral proceedings. The Carpmaels records department did not notice the revocation decision and thus no appeal deadline was docketed. The responsible attorneys did not notice the mistake, and it was BASF who themselves contacted Carpmaels about the appeal deadline after noticing the decision on the EP register. Carpmaels were then instructed by BASF to work on a statement of grounds of appeal. Still, however, the appeal deadline was not docketed. 

Importantly at the time Carpmaels was still reliant on paper files. The retired partner ultimately responsible for the case was predominantly working away from the office and relied on documents that had been emailed to him by BASF and not the physical file. The attorney therefore failed to spot that the documents received by Carpmaels from the EPO had not been processed correctly by the records department. The retired partner was also travelling at the time the appeal deadline came due and only noticed that it had been missed on his return. 

The Board of Appeal in the appeal case (T1663/12) considered only the appeal's admissibility and the request for re-establishment. The EPO was characteristically harsh in its assessment of Carpmaels' case for re-establishment. The Board was not convinced that the monitoring system Carpmaels had in place was satisfactory, noting that: 

The fact that the Revocation Decision passed through so many hands without being identified as such indicates that these persons were not sufficiently instructed that mail must be read completely and thoroughly, or that no effective cross-check was performed.

The Board noted the failure of the record department to cross-check the incoming mail, the failure of the attorney responsible for signing the delivery receipt to properly review the documents, and the failure of the responsible retired partner to double-check the appeal deadline whilst he was working on the statement of grounds. The Board concluded:

looking at the whole series of failures and mistakes which took place, the Board sees no basis to argue that the failure to meet the appeal time limit could be considered an isolated mistake in a well functioning time monitoring system.

The request for re-establishment was thus refused. 

High Court showdown

BASF have now filed a case against Carpmaels in the UK. BASF have reportedly alleged that because of the missed deadline for filing the appeal, they lost a patent worth €1.05 billion ($1.2 billion). BASF particularly argued that the patent, which would have expired in 2034, would have allowed them to become a market leader in filter products.

Carpmaels' admit to missing the appeal deadline. Their argument in defence to BASF's claims is that the patent was clearly invalid anyway, and that the decision of the opposition division to revoke the patent would have been upheld by the Board of Appeal. Carpmaels have therefore placed themselves in the rather unusual position of arguing against the validity of a patent they once defended. The merits of the argument will be difficult for the court to assess, given that the opponents in the appeal case did not file replies to the statement of grounds of appeal, and no preliminary view was given by the Board on the merits of the case. The Court may however take note of the divisional patent (EP2042227) in the same family, which was also revoked at opposition. BASF withdrew their appeal of this decision. There also appears to be a pending divisional application (EP2933009), however the register shows no activity since 2017. 

In assessing the merits of the case the court may therefore have to wade through a myriad of hypotheticals: what decision would the Board of Appeal have come to had the appeal proceeded and what would have happened in the market had BASF's patent been maintained? However the court decides to deal with these questions, the case is undoubtedly going to be a fascinating one to observe. 

The case continues.