Anan Kasei Company, Ltd v Neo Chemicals & Oxides (Europe) Ltd

JurisdictionEngland & Wales
JudgeMr Justice Fancourt
Judgment Date04 May 2021
Neutral Citation[2021] EWHC 1035 (Ch)
CourtChancery Division
Docket NumberCase No: HP-2016-000018
Date04 May 2021
(1) Anan Kasei Co., Limited
(2) Rhodia Operations SAS
(1) Neo Chemicals & Oxides (Europe) Limited
(2) Neo Performance Materials, Inc.
(3) Neo Cayman Holdings Limited

[2021] EWHC 1035 (Ch)


THE HONORABLE Mr Justice Fancourt

Case No: HP-2016-000018





Rolls Building

7 Rolls Buildings

Fetter Lane, London


Thomas Mitcheson QC and Tim Austen (instructed by Hogan Lovells International LLP) for the Claimants

Hugo Cuddigan QC, Kathryn Pickard and Professor Lionel Bently (instructed by Bird and Bird LLP) for the Defendants

Hearing dates: 26, 29 March 2021

Approved Judgment

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

THE HON. Mr Justice Fancourt

Mr Justice Fancourt Mr Justice Fancourt



In this action, the defendants (together “Neo”) seek summary judgment on three separate legal issues pursuant to CPR Part 24 and permission to withdraw admissions pursuant to CPR rule 14.1(5) and 14PD para 7. The action is now an inquiry into damages caused by Neo's infringement of the claimants' patent in the UK. The validity of the patent and Neo's infringement were established by order dated 6 June 2018, following a trial before Mr Roger Wyand QC sitting as a deputy judge of the High Court. Neo had made admissions in its Defence that meant that liability would be established if the validity of the patents was upheld.


After the trial, the claimants (together “Rhodia”) elected to claim damages rather than an account of profits. The Court of Appeal later dismissed Neo's appeal against the order of Mr Wyand QC.


It is generally unnecessary for the purposes of this judgment to distinguish between the individual claimants and defendants.


The infringement alleged by Rhodia relates principally to the importation from China of high surface area cerium oxide, which is used in making catalytic converters for diesel motor vehicles. Some of the product imported by Neo was sold to Johnson Matthey (“JM”) in the United Kingdom. That part of Rhodia's claim to damages has been settled. A substantial quantity of the rest of the product was sold to Umicore in Germany and elsewhere. Rhodia alleges that importation of the product from China before its export was “importation” within the meaning of section 60(1) of the Patents Act 1977 and therefore an infringement of its patents, which caused other loss. There are other respects in which Rhodia alleges that samples of the products were wrongly imported or kept by Neo for development and research purposes, amounting to infringement and causing loss.


Neo's summary judgment application was issued on 9 February 2021, with a view to its being heard at a case management conference listed for 24 February 2021. The issues of law identified by Neo for summary determination are the following:

“1. Whether goods brought from China into and stored in a bonded warehouse in the UK are imported and/or kept within the meaning of s.60 of the Patents Act 1977.

2. Whether goods brought from China into and stored in the UK for the purpose of export and distribution overseas are imported and/or kept within the meaning of s.60 of the Patents Act 1977.

3. Whether the defendants are entitled to assert that:

a. but for the infringing importation and keeping of goods into the UK, Neo UK would have routed those same goods through a non-UK port, such as Oslo, Norway, and accordingly not have infringed the patent in suit;

b. but for the infringing importing, keeping and/or disposal of Development Samples in the UK, Neo UK would have disposed of Development Samples to customers outside the UK without importing into and/or keeping the Development Samples in the UK and accordingly not have infringed the patent in suit.”


The first and second issues both relate to high surface area cerium oxide brought into the UK by Neo, and the first relates to product that was then exported to a non-EU country (“third state”). Neo maintains that this category of product is non-Union goods that in fact remained within the EU's external transit customs procedure, designated for export outside the EU, such that there can have been no infringement of Rhodia's intellectual property rights. The second issue relates to product that cleared customs in the UK for the purpose of export principally to Germany. Neo maintains that this treatment of goods does not amount to “importing” or “keeping” the goods in the UK within the meaning of the statute because there was no importation for the purpose of making, disposing of, offering to dispose of or using the goods in the UK.


The first and second issues therefore relate to mixed questions of law and fact about the extent of Neo's infringement of Rhodia's patents. The first issue was considered by Rhodia (without dissent from Neo) to relate to only about 5% of the products that remain in dispute, which were exported to a third state. The second issue relates to almost all the rest of the disputed products and is therefore by far the more important issue.


The third issue relates to what loss was caused to Rhodia by any such infringement that is proved. Neo's case, in this regard, is that no loss of profit was caused to Rhodia by importation of any product into the UK (other than the product that was provided to JM in the UK) because, without any infringing importation, Neo could and would have sold exactly the same products to Umicore by routing them via a non-UK port, such as Oslo (as it claims that it did from early 2018). It maintains that it is not only entitled to argue but correct in law to assert that the availability of a non-infringing alternative of this kind means that Rhodia would have suffered exactly the same losses even if its patents had not been infringed by importation or keeping of certain product in the UK, and so no loss was caused by the infringement. This argument involves the proposition that a long-standing decision of the House of Lords on a Scottish appeal, United Horse Shoe and Nail Co Ltd v John Stewart & Co (1888) 13 App Cas 401 (“ United Horse Shoe”), is wrong and should not be followed.


Neo's attempt to obtain summary judgment on these questions of law raises a number of difficulties, the first of which is that its statements of case in this action contain admissions of infringement by importation and keeping in the UK. This was pointed out to Neo, in the course of applications that I heard in December 2020, in connection with draft amended statements of Neo's case that had been provided to Rhodia before that hearing. The summary judgment application had not been issued at that stage. It was therefore issued in the knowledge that the admissions remained in place. Neo takes the approach (which Rhodia disputes) that the admissions are unspecific and inconsequential and so do not amount to an obstacle to its taking the point that there was no infringement in relation to products that were marked and intended for export to Germany or a third state.


Nevertheless, when Rhodia objected to Neo's approach Neo issued its application for permission to withdraw admissions. That application was issued on the day that the case management conference was due to be heard, with a time estimate of one day. The draft order annexed to the application seeks relief in the following terms:

“1. The defendants have permission to assert the facts relating to their dealings or lack thereof with HSA cerium oxide products pleaded in the Amended Points of Defence (the “Facts”) attached at exhibit…

2. The defendants have permission to serve the Re-re-re-re-re-Amended Defence attached…

3. To the extent that any earlier statements of the defendants, including in pleadings, evidence and submissions, are inconsistent with the Facts and constitute admissions, the defendants have permission to withdraw those admissions.”

Neo's application therefore does not properly identify the admissions that it seeks permission to withdraw. This does not appear to me to be accidental. Neo does not wish to accept that there are relevant admissions that need to be withdrawn, but it does wish to be able to pursue its amended pleaded case without being at risk of admissions being held against it. As a result of that approach, considerable time had to be spent at the hearing before me (and in skeleton arguments) identifying what were said to be relevant admissions (about which there was disagreement). It is an inappropriate and unsatisfactory way to present such an application, which the court in other circumstances might have refused to hear for that reason.


Nevertheless, at the hearing of the case management conference Zacaroli J was told that the summary judgment application and the admissions application needed to be heard urgently. There was no objection as such by Rhodia to the hearing of the summary judgment application, nor could it properly object to the hearing of the admissions application. The reason for the urgency (asserted by both sides) was that any decision on summary judgment might need to be appealed and determined by the Court of Appeal in advance of the trial date, January 2022. On that basis, Zacaroli J acceded to the request for expedition. He did not have to consider in any detail the nature of the issues, though he warned Neo that the judge hearing the application might take the view that they were better left to be determined at trial.


As a result, the applications were listed urgently before me, just before the end of the Lent term, for a 3 day hearing, including pre-reading.

The Admissions


In view of the way that the argument on admissions developed, it is...

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2 firm's commentaries
  • We Have Some Issues: Summary Judgment Under CPR 24.2
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