Autostore Technology as v Ocado Group Plc
| Jurisdiction | England & Wales |
| Judge | Hacon |
| Judgment Date | 30 March 2023 |
| Neutral Citation | [2023] EWHC 716 (Pat) |
| Docket Number | Case No: HP-2020-000035 |
| Court | Chancery Division (Patents Court) |
| Year | 2023 |
HIS HONOUR JUDGE Hacon
Case No: HP-2020-000035
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY LIST (ChD)
PATENTS COURT
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Vernon Flynn KC, Adrian Speck KC, Nicholas Saunders KC, Kathryn Pickard, Miles Copeland, Georgina Petrova and Thomas Lunt (instructed by Kirkland & Ellis International LLP) for the Claimant
Iain Purvis KC, Piers Acland KC, James Segan KC and Tom Alkin (instructed by Powell Gilbert LLP) for the Defendants
Hearing dates: 15–18, 21–22, 29–31 March 2022, 4 and 11–12 April 2022
Approved Judgment
This judgment was handed down remotely at 5pm on 30 March 2023 by circulation to the parties or their representatives by email and released to the National Archives .
HIS HONOUR JUDGE Hacon
INTRODUCTION
The Claimant (“AutoStore”) is a Norwegian company that has been a pioneer in automated warehouse technology. Its growth was largely powered by the invention and development of an automated system for storing and retrieving containers in a warehouse, a system known as the “AutoStore ASRS”. The letters stand for automated storage and retrieval system. Rails forming a grid are installed at the top of the warehouse. Robots travel along the rails, in X and Y directions. They park and retrieve containers which are stacked below in vertical piles.
AutoStore ASRS enabled a higher density of storage than had previously been possible with commensurate savings in warehouse size and associated costs. The first commercial use of AutoStore ASRS was in 2005. Since then, the system has been installed in more than 800 locations in 45 countries.
The most significant modification in AutoStore ASRS since 2005 has been in the design of the robots. The original robots were known as “Red Line” robots. More recently AutoStore has designed and developed “Black Line” robots, which are covered by the patents in issue in these proceedings.
The first defendant develops automated systems for use in large scale grocery businesses. The second defendant is a joint venture between the first defendant and Marks & Spencer plc. It operates an online grocery business in the UK under the “Ocado” brand name, including the fleet of Ocado vans which deliver the groceries to the homes of customers. The first defendant operates the system used by the second defendant. The third defendant markets the technology to supermarkets outside the UK. The fourth defendant owns IP rights relating to the technology. The sixth defendant develops and makes robots used by the second defendant. The first five defendants are all part of the same Ocado group of companies. The sixth defendant is not, but it is convenient to refer to all the defendants as “Ocado”.
Ocado is a former customer of AutoStore's. Ocado purchased a Red Line system in 2012. Ocado has since developed its own system, known as the Ocado Smart Platform, or “OSP”.
The OSP system and the robots it uses are alleged by AutoStore to infringe the two principal patents in suit. These are EP (UK) No. 2 928 794 (“EP 794”) and EP (UK) No. 3 070 027 (“EP 027”), both owned by AutoStore.
Beyond findings of non-infringement in relation to AutoStore's allegations of infringement, Ocado further seek certain declarations of non-infringement (“DNIs”) discussed further below.SPLIT TRIAL
The trial was heard in two parts. The first part concerned two alleged prior disclosures of the inventions claimed in the patents in suit. It was not in dispute that the disclosures were made; the point in issue was whether either or both were made under a binding obligation of confidence. This turned largely on identifying the law which governed the disclosures. In this part of the trial, Vernon Flynn KC and Georgina Petrova appeared for AutoStore; James Segan KC for Ocado.
In the other part of the trial, concerning what were described as the technical issues, Adrian Speck KC, Nicholas Saunders KC, Kathryn Pickard, Miles Copeland and Thomas Lunt appeared for AutoStore; Iain Purvis KC, Piers Acland KC and Tom Alkin appeared for Ocado.
THE WITNESSES
Prior Disclosure
AutoStore called three witnesses of fact and two expert witnesses on foreign law.
Evgenii Konstantinov is a co-founder of EVS, Ooo (“EVS”), a company based in St Petersburg, and is its Deputy General Director. He gave evidence about the relationship between AutoStore, EVS and the Central Bank of the Russian Federation (“the Bank”), with interpretation from Russian. Not much of his evidence was central to the issues. In cross-examination he gave short, clear answers.
Michael Kutsenko is the former Head of International Development at EVS. He was the contact at EVS for communications between AutoStore and EVS and attended a key meeting. Mr Kutsenko spoke good English and he too gave brief, clear answers, which were always to the point. He was a very good witness.
Sven Åge Hjorteland is AutoStore's Vice President of Sales. He was the AutoStore contact in the dealings with EVS and the Bank. He gave his evidence in excellent English and was a helpful, straightforward witness.
AutoStore's expert witness on Russian law was Professor Peter Maggs. Professor Maggs is a Research Professor at the University of Illinois. He specialises in the law of the Russian Federation. He is the author, co-author, co-editor, translator or co-translator of what he described as a dozen articles on Soviet and Russian law, including a translation of the Russian Civil Code.
I am sure that Professor Maggs was trying to help the court, but occasionally he avoided giving a clear answer to a straightforward question, as if reluctant to be pinned down to an answer unhelpful to AutoStore. There is a particular matter about his evidence I must raise. In his report he said that he had given evidence as an expert on Russian law, including various cases before English courts. He referred to OJSC TNK-BP Holding v Lazurenko [2012] EWHC 2781 (Ch) in which Professor Maggs gave evidence about Russian law on confidentiality. The claimant, TNK-BP alleged that the defendant, Mr Lazurenko, had been in breach of both contractual and equitable obligations of confidence. The Chancellor, Sir Andrew Morritt, ruled that these causes of action were governed by Russian law and found that the equitable and contractual obligations were to be treated as being the same. Professor Maggs acted as an expert witness on Russian law for Mr Lazurenko. The expert witness for TNK-BP stated that in order to protect commercial confidential information it was necessary for there to be compliance with the Russian Federation Law “on commercial secret”, the Commercial Secrecy Law. The Chancellor quoted this part of Professor Maggs' evidence in response:
“Yes, I generally agree with Mr Rozenburg. In order for information to be confidential and protected, the holder of a commercial secret must take special steps to preserve confidentiality. Among other things, the holder must expressly identify the information comprising its commercial secrets, must mark documents containing such information as “Commercial Secret of [name of holder of the secret]”. If these precautions are not taken, confidentiality is lost.”
That evidence is difficult to reconcile with what he said in his report in this case, on a point that could have been of some significance. When challenged in crossexamination, Professor Maggs said that as best he could recall he was giving evidence in TNK-BP about a claim under the Commercial Secrecy Law, not a claim of confidence under the law of contract. But as the Chancellor made clear, the claim was to a contractual (and equitable) obligation of confidence. It would have been far better had Professor Maggs given prominence to his evidence in TNK-BP from the start, together with an explanation in his report for what appeared to be inconsistent evidence now. Failure to do this did not improve confidence.
Are Stenvik gave evidence for AutoStore on Norwegian law. He is a partner at the law firm BAHR in Oslo and is Head of the Intellectual Property Law practice group. There was little dispute about Norwegian law and he was crossexamined only briefly. He gave clear, authoritative answers.
Ocado called no witnesses of fact. They called two expert witnesses on Norwegian law, Professor Harald Irgens-Jensen and Professor Guiditta Cordero-Moss. Professor Irgens-Jensen is from the Department of Private Law at the University of Oslo; Professor Cordero-Moss is from the same department at Oslo University. Neither was cross-examined. AutoStore contended that Professor Cordero-Moss's evidence was inadmissible because it was premised on a hypothetical factual situation that is irrelevant to the issues in dispute. I have not found it necessary to rely on Professor Cordero-Moss's evidence.
Ocado's expert on Russian law was Maxim Kulkov. Mr Kulkov is the managing partner at KK&P Trial Lawyers, a firm he established in Moscow. Previously he headed the Russian dispute resolution practice at Freshfields Bruckhaus Deringer LLP, Goltslat PLP and Pepelyaev, Goltsblat and Partners. Mr Kulkov has been in practice as counsel for over 26 years and has also sat as an arbitrator in centres in Russia and in Stockholm. Mr Kulkov gave one or two slightly surprising answers relating to unimportant matters, which may have been because he was not giving evidence in his native Russian. Generally, I thought he was a very good witness, stating his views in clear and direct terms.
Technical issues
AutoStore filed evidence from two expert technical witnesses....
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