Conductive Inkjet Technology Ltd v Uni-pixel Displays Inc.
| Jurisdiction | England & Wales |
| Judge | Mr Justice Roth |
| Judgment Date | 07 October 2013 |
| Neutral Citation | [2013] EWHC 2968 (Ch) |
| Docket Number | Case Nos: HC12E02467; HC12F02468 |
| Court | Chancery Division |
| Date | 07 October 2013 |
[2013] EWHC 2968 (Ch)
Mr Justice Roth
Case Nos: HC12E02467; HC12F02468
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
PATENTS COURT
Royal Courts of Justice
Rolls Building, Fetter Lane
London, EC2A 2LL
Hugo Cuddigan and Chris Aikens (instructed by Squire Sanders (UK) LLP) for the Claimant
Daniel Alexander QC and Isabel Jamal (instructed by Bird & Bird LLP) for the Defendant
Hearing dates: 22–23 April 2013
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.
INTRODUCTION
This is an application to set aside the permission granted to the claimant ("CIT") to serve two related claims out of the jurisdiction on the defendant ("UPD"), on the basis that there is no jurisdiction for such service or that such jurisdiction should not be exercised. As regards one of the two claims, UPD alternatively submits that the proceedings should be stayed pending resolution of the case it has brought against CIT in Texas.
CIT is an English technology company. Its business, as its name suggests, is in the field of inkjet printing. More specifically, it works on the use of such printing to produce bulk conductive materials. The particular technology relevant to these proceedings allows metallic lines to be deposited onto substrates used in display and touch-screen applications. As is well-known, the market for touch-screens is substantial and is growing rapidly as a result of the popularity of smart-phones and tablet computers.
CIT was incorporated in 2002 and was originally an intellectual property ("IP") rights holding company for the purpose of an existing joint venture between two English companies, Carlco plc ("Carlco") and Xennia Technology Ltd ("Xennia"). Following its establishment, CIT was jointly owned by Carlco and Xennia and all IP and associated rights arising out of the joint venture were assigned to it. By subsequent acquisitions of Xennia's shares, in 2005 Carlco became 70% owner of CIT and then in 2007 the sole owner of CIT. During the period of joint ownership, the shareholders' agreements provided that any IP rights developed by Xennia relating to the business of CIT would be the property of CIT. From the time when CIT became a wholly owned subsidiary of Carlco, it is CIT's case that it granted a licence to Xennia to continue to work with UPD on the project then in development, which I shall describe below, on the basis that all IP and associated rights arising out of Xennia's work on that project would be owned by CIT.
For the purpose at least of the present application, UPD has not sought to challenge CIT's claim that it has at all times been the owner of all IP and associated rights arising out of the work of Xennia in relation to the use of inkjet printing in the production of bulk conductive metals. That is said by CIT to include detailed techniques and product formulations developed by Xennia relating to the deposit onto substrates of metallic lines of copper for use, inter alia, in display and touch-screen applications.
UPD is a Texan company based in Texas. Its activities include the design and manufacture of films to be incorporated into touch panels. In about 2001, UPD began developing a flat panel display technology in which pixels are selectively controlled to allow light into or shutter it out of a light guidance substrate. This project was called "TMOS" (time multiplexed optimised shutter).
THE FACTS
The 2005 NDA
Following a meeting at an industry symposium in Boston in late May 2005 between senior executives of Xennia and UPD, there were discussions between those companies regarding the use of Xennia or CIT's deposition technologies in the TMOS project. As a result, UPD, Xennia and CIT entered into a non-disclosure agreement which was stated to have effect as from 8 June 2005 ("the 2005 NDA").
The 2005 NDA included the following provisions, insofar as material:
i) Clause 1.1 defined "Confidential Information" for the purpose of the agreement as meaning:
"… any information related to Uni-Pixel's TMOS flat panel display technology and Xennia's or CIT's metal deposition technologies including, without limitation, by inkjet or laser, as well as any other information labelled "Confidential" by a Party with reference to this Agreement or any information otherwise treated by the Party providing such information as confidential … which (a) may be disclosed to any of the Parties as a result of their dealings with one another, and (b) is not generally known by competitors or the general public."
ii) Clause 1.3 defined "Authorized Use" for the purposes of the agreement as meaning:
"… the exchange of Confidential Information for the limited purpose ("Purpose") of developing a potential business relationship among the parties with respect to the potential for using Xennia and/or CIT's deposition technologies in the construction of Uni-Pixel's flat panel displays."
That is a reference to the TMOS project.
iii) By clause 2, the parties agreed that they were to be given access to the Confidential Information solely for the purposes of the Authorized Use and that for a period of five years each would not use it for its own benefit or the benefit of any third party "except as defined within Authorized Use".
iv) By clause 4, the parties agreed that all Confidential Information would remain the exclusive property of each party to which it originally belonged.
v) Clause 9 provided as follows:
"This Agreement is the sole agreement among the Parties with respect to the exchange of Confidential Information divulged pursuant to the terms hereof. This Agreement supersedes any and all prior agreements…."
vi) Clause 10 (mis-numbered 7) provides as follows:
"Any expiration or termination of this Agreement will not alter the rights or obligations, including, but not limited to the obligations of each Party under section 2 above, with respect to the Confidential Information and Materials disclosed and provided to the other Parties prior to such expiration or termination."
vii) By clause 12, the agreement would be automatically terminated one year after 8 June 2005 unless renewed in writing, and in any event:
"the provisions herein shall be superseded by the provisions of any contract that may be entered into as a result of any discussions which may take place between the parties concerning the Purpose."
The 2005 NDA contained no governing law or jurisdiction clause.
There is dispute as to whether the 2005 NDA was signed in 2005 (as UPD contends) or only in July 2006 (as CIT contends). But for present purposes that is of little significance. It is not suggested that the agreement was renewed in writing and accordingly it is common ground that (a) it applies only to disclosure made in the year 8 June 2005 – 7 June 2006; and (b) it restricts use of the information up to 7 June 2010.
The Xennia — UPD contracts
In July 2006, Xennia sent CIT a draft of a proposal it had prepared for UPD regarding the use of CIT technology in the TMOS project. On 22 September 2006, Xennia presented their proposal to UPD entitled "Deposition of copper onto a micro patterned substrate" ("the September 2006 Proposal"). This involved use of the "CIT Ink Process" and, as requested by Xennia, CIT wrote to UPD a 'comfort letter' confirming that following acceptance of the proposal and a successful outcome of the project, CIT would be prepared to negotiate a licence to UPD of CIT's "background IPR" insofar as required.
There is dispute as to whether a contract was entered into between Xennia and UPD on the basis of the September 2006 Proposal. However, UPD accepts and contends that it did enter into a contract with Xennia on the basis of a further written proposal from Xennia dated 23 March 2007 ("the March 2007 Proposal") which similarly involved the use of CIT technology and appears to be a variation of the September 2006 Proposal. The contract sets out in section 7 a series of "terms of business" including, at clause 7.2, an undertaking by each party to keep confidential for three years from commencement of Xennia's supply of the contracted services ("the Services"):
"all proprietary or confidential information received from or on behalf of the other [party] whether received before or after this Agreement…"
Clause 8 concerns IP rights and includes the following provisions:
"8.3. IP owned by either Party on the date of acceptance of the Proposal ("Background IP") will remain the exclusive property of the owning Party.
…
8.6. Subject to payment of all outstanding amounts owed to Xennia by [UPD], Xennia shall grant to [UPD] a worldwide non-exclusive, irrevocable, royalty-free licence to use IP developed by Xennia in the course of providing the services ("Foreground IP") within [UPD's] field of time multiplexed optical shutter technology "TMOS".
8.7. For the sake of clarity, commercial exploitation of the CIT technology by [UPD] will be subject to license of relevant Background IP by from [sic] Conductive Inkjet Technology Ltd on commercial terms to be negotiated between [UPD] and Conductive Inkjet Technology Ltd.
…
8.10. For a period of 3 years from the commencement of the Services, Xennia agrees not to carry out work on behalf of third parties in the area of applying the CIT technology within the area of TMOS as defined above"
It is clear from the March 2007 Proposal that UPD had already received samples from Xennia.
On 17 July 2007, Xennia sent UPD a further detailed proposal entitled: "A program to develop a robust and reliable method for the production of copper plated microlens substrate" ("the July 2007 Proposal"). This also relates...
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