British Gas Services Ltd (Respondent/Claimant) v Vanclare
| Jurisdiction | England & Wales |
| Judge | Mr Justice Arnold |
| Judgment Date | 17 June 2015 |
| Neutral Citation | [2015] EWHC 2087 (IPEC) |
| Court | Intellectual Property Enterprise Court |
| Docket Number | Case No: IP-2015-000051 |
| Date | 17 June 2015 |
[2015] EWHC 2087 (IPEC)
IN THE HIGH COURT OF JUSTICE
THE INTELLECTUAL PROPERTY ENTERPRISE COURT
The Rolls Building,
7 Rolls Building,
Fetter Lane,
London,
EC4A 1NL
Mr Justice Arnold
Case No: IP-2015-000051
Brian Nicholson (instructed by Williams Powell) appeared on behalf of the Claimant
Richard Davis (instructed by Mathys & Squire) appeared on behalf of the Defendant
I have before me two applications. The first is an application by VanClare SE LLC ("VanClare") for the transfer of a claim for revocation of United Kingdom Patent No 2364420 ("the Patent") brought by British Gas Services Ltd ("BGSL") from the Intellectual Property Enterprise Court ("IPEC") to the Patents Court. The second application is an application by BGSL for a stay of a claim for infringement of the Patent brought by Metertech LLC ("Metertech") in the Patents Court.
Although on the face of it the first application raises the question of whether the claim for revocation should be in the IPEC, it turns out that the real dispute between the parties is over the question of whether the validity of the patent should be determined in advance of the claim for infringement or at the same time. Indeed, counsel for BGSL sensibly accepted that BGSL would not oppose transfer of the revocation claim from the IPEC to the Patents Court if there were to be an order for bifurcation of the issues of validity and infringement, with validity being tried first.
Accordingly, I will concentrate upon the question of whether it is appropriate, as BGSL seeks, to order a trial of the validity issues in advance of a trial of the infringement issues or, as VanClare and Metertech contend, all issues should be tried together at the same time.
The background to the matter is that the Patent, which is entitled "A Prepayment Utility Metering System", was granted on 20 November 2002 to a company called Secure Electrans Ltd ("SEL"). On 24 September 2014, SEL having entered into administration, SEL's administrators assigned the Patent, together with various other patents, to VanClare. VanClare was registered as the proprietor of the patent on 30 October 201On 5 January 2015 VanClare entered into an agreement with Metertech granting, Metertech and VanClare contend, Metertech an exclusive licence under the Patent. That exclusive licence was registered on 13 March 2015.
Both VanClare and Metertech are companies incorporated in the State of Delaware, USA. It appears to be the case that they are associated companies, both being under the control of an individual called Perry Chopra. Metertech was incorporated on 9 December 2014. On the day after incorporation, Mr Chopra, on behalf of Metertech, wrote to British Gas drawing the Patent to its attention and suggesting that British Gas needed to take a licence. That letter was followed on 12 January 2015 by a more formal letter before action written by Metertech's (and VanClare's) patent attorneys. There followed some correspondence between Metertech's patent attorneys and BGSL's patent attorneys, which led to a letter from Metertech's patent attorneys dated 26 February 2015 demanding that BGSL provide undertakings by close of business on 5 March 2015, failing which Metertech threatened to institute proceedings without further notice.
On 6 March 2015 BGSL issued the claim for revocation in the IPEC and served it upon VanClare at the offices of VanClare's patent attorneys. Subsequently, on 17 April 2015 Metertech commenced proceedings in the Patents Court for infringement of the patent against BGSL and served those proceedings on BGSL. Two weeks later Metertech served Particulars of Claim and Particulars of Infringement setting out its infringement case. I should explain that VanClare has been joined to the infringement proceedings as an additional passive defendant.
VanClare sought BGSL's consent to a transfer of the revocation proceedings to the Patents Court. That consent was not forthcoming, and accordingly VanClare issued the first of the applications which is before me on 17 April 2015. Subsequently, BGSL riposted with the second of the applications which is before me on 29 April 2015. As I have indicated, it has become clear that the real bone of contention between the parties is not as to venue, but as to the correct mode of trial. Accordingly, I shall proceed on the basis that the revocation claim will be transferred from the IPEC to the Patents Court.
In considering the proper mode of trial, it seems to me that the starting point is that it is normal practice in the Patents Court for the issues of validity and infringement of a patent to be tried together. Equally, however, the court has the power to order those issues to be tried separately and in whatever order may be convenient in the circumstances of the case. There is precedent both for infringement being tried before validity and for validity being tried before infringement. If the court is to depart from the normal practice, however, it seems to me that some good reason needs to be shown for doing so. In saying that, I do not intend to suggest that the onus is necessarily a heavy one, merely that it must be shown that it is the better way in which to proceed.
In the present case, it seems to me that the starting point is to consider in outline the nature of the issues raised and the estimates for trial. So far as BGSL's validity case is concerned, BGSL attacks the validity of the patent on three grounds. First, BGSL contends that the claims are obvious in the light of the common general knowledge of the skilled person. Secondly, it contends that the claims are obvious over International Patent Application Number WOA299/31953 ("Manson"). Thirdly, it contends that the claims are invalid on the ground of added matter.
It is BGSL's case that each of these three attacks is simple, straightforward and strong, and that in the result the validity issues can be tried quickly and simply and at relatively little expense. It is BGSL's estimate that the validity issues can be tried in the Patents Court in a trial lasting between two and three days. I do not understand VanClare and Metertech to dissent from that estimate. Where VanClare and Metertech do take issue with BGSL, however, is over the proposition that the attacks on validity are simple, straightforward or strong ones.
It is pointed out on behalf of VanClare and Metertech that BGSL has not applied for summary judgment on its claim for revocation, nor is it suggested by BGSL that the attacks on validity are suitable for summary determination. VanClare and Metertech say that, although the case is not one of technical complexity — on VanClare and Metertech's assessment, the technical complexity rating is either two or three — nevertheless the arguments are not necessarily so straightforward as BGSL contends.
So far as this question is concerned, I have been taken relatively briefly by both counsel through the arguments on validity to the extent that they have been outlined. As it seems to me, the arguments are not ones of particular complexity. On the other hand, I do not think it would be safe to conclude at this stage that BGSL has anything approaching an unanswerable case. On the contrary, it seems to me that BGSL's recognition that the claims are ones which require a trial for their proper resolution is a realistic one.
Turning to the question of infringement, it is necessary to say a little more about the background to the case. Reliance is placed by VanClare and Metertech upon a report published by the Department of Energy and Climate Change entitled "Smart Metering Implementations Programme: Second Annual Report on the Rollout of Smart Meters". On page 33 of that report it states as follows:
"In September 2013 British Gas of Landis+Gyre announced a £600,000,000 contract running...
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