Samsung Electronics Company Ltd (Appellant/Claimant) v Apple Retail UK Ltd and Another (Respondents/Defendants)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Kitchin |
| Judgment Date | 11 March 2014 |
| Neutral Citation | [2014] EWCA Civ 250 |
| Docket Number | Case No: A3/2013/1432(A)/(B) |
| Court | Court of Appeal (Civil Division) |
| Date | 11 March 2014 |
[2014] EWCA Civ 250
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION (PATENTS COURT)
THE HON MR JUSTICE FLOYD
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Moore-Bick
Lord Justice Rimer
and
Lord Justice Kitchin
Case No: A3/2013/1432(A)/(B)
Henry Carr QC and Mark Vanhegan QC (instructed by Bristows LLP) for the Appellant
Guy Burkill QC and Thomas Hinchliffe (instructed by Freshfields Bruckhaus Deringer LLP) for the Respondents
Hearing date: 12 February 2014
Introduction
This is the judgment of the Court.
The appeal was originally listed to come on for hearing before this court on 4 or 5 March 2014 with a time estimate of three days. It concerns the validity and infringement of complex patents owned by the claimant ("Samsung") which it alleges have been infringed by the defendants (collectively "Apple"). The proceedings are of considerable commercial importance to the parties for the alleged infringements include the iPhone 4, the iPhone 4S and the iPad 2 3G. At trial, Floyd J (as he then was) found each of the patents invalid, both as granted and as proposed to be amended, and he ordered their revocation, which he suspended pending an appeal to this court, for which he gave permission.
On 12 February 2014 we heard two applications. Samsung sought an adjournment of the appeal pending the determination of applications which it has made to the European Patent Office (the "EPO") for amendment of the claims of the patents. We were told by Samsung that these applications, which we shall refer to as the central amendment applications, are likely to be determined by June 2014, if not earlier.
Apple responded with an application for an order that unless Samsung undertook to take no further steps with its central amendment applications, then the permission to appeal granted by the judge should be set aside, the notice of appeal struck out and the patents revoked. In substance, therefore, it sought an order requiring Samsung at this stage to elect between pursuing this appeal or the central amendment applications.
At the end of the hearing we indicated that we would reserve judgment. Two days later, on 14 February 2014, we communicated to the parties that we had decided to allow Samsung's application and dismiss Apple's application, but without prejudice to Apple's right at the hearing of the appeal to make such further submissions (and any necessary application) about the conduct and further progress of the action as it may consider appropriate. We also indicated that we would provide our reasons in writing as soon as possible. That we now do.
The background
These proceedings are part of a global dispute between Samsung and Apple. Litigation is underway in the USA, Japan, Korea, Germany, France, Italy, Netherlands and Australia, in addition to the UK.
The claim form in these proceedings was issued on 29 June 2011 and asserted infringement by Apple of three patents, only two of which are in issue on this appeal, namely EP (UK) Patent No. 1,005, 726 (the "726" patent) and No. 1,714,404 (the "404" patent). The action came on for trial in November and December 2012 and in his judgments given on 7 March 2013, Floyd J found that neither patent was entitled to its claimed priority date and that each was invalid by reason of intervening prior art. He also held that, even if the patents had been entitled to their claimed priority dates, they would have been invalid for obviousness.
Samsung had made two conditional applications to amend each of the patents before trial. The judge dealt with the second of these applications in respect of each patent and rejected it, finding it would not render the patent valid. We should also explain that Samsung maintained right up to trial that all of the claims of the 726 patent as granted were independently valid. The judge held this approach to be contrary to the established practice of the court and at a subsequent hearing awarded Apple its costs of dealing with the claims of this patent (other than claims 1 and 14) on an indemnity basis.
The judge made his final order on 8 May 2013 and declared that the 726 and 404 patents were invalid, both as granted and as proposed to be amended; dismissed the amendment applications; granted permission to appeal; and suspended the order for revocation of the patents until after the determination of this appeal, provided that Samsung prosecuted it with due diligence. Shortly afterwards, on 29 May 2013, Samsung filed its notice of appeal. As we have said, the hearing of the appeal was originally fixed for 4 or 5 March 2014, with a time estimate of three days.
Samsung is also suing Apple in respect of the 726 patent in Germany and in Italy. On 20 January 2012, the Mannheim Regional Court rejected Samsung's infringement claim. On 10 April 2013, the German Federal Patent Court found the patent invalid. Samsung has appealed both decisions. The 404 patent is in issue in proceedings in Italy and in France. A provisional date for trial in the French proceedings has been set for July 2014.
On 5 November 2013, Samsung filed the central amendment applications. If they are granted, they will have effect in all designated states. Samsung explained that, given the multiple on-going parallel proceedings that would be affected by central amendment applications and the consequent need for co-ordination, it was not in a position to file these applications before it did. Nevertheless, it informed us that a request for acceleration of the applications had been made to the EPO and it understood this to have been granted.
Specifically in relation to the 404 patent, by a communication dated 20 December 2013, the Examining Division of the EPO indicated its approval in principle to the proposed limitation of claim 1 (subject to a suggested minor drafting change), and raised some issues with the remaining claims. Samsung said it had addressed these suggested drafting changes and the issues with the remaining claims in its response to the Examining Division dated 20 January 2014. In the result, it expected to receive the EPO's decision upon this application in March 2014.
Turning to the 726 patent, the Examining Division indicated that it would aim to provide initial views by the end of January 2014. At the time of the hearing before us, the initial response had not been received although it was expected imminently. Since the hearing we have been provided with a letter from the Examining Division dated 18 February 2014 indicating that the proposed amendments are not clear and would involve added matter, and giving Samsung two months in which to file observations, and insofar as the deficiencies are rectifiable, to provide corrections.
At the time of the hearing Samsung believed that it was overwhelmingly likely that the central amendment applications would be determined in the next few months. In light of the recent communication from the EPO it seems Samsung was unduly optimistic. Nevertheless we think it likely the applications will still be determined relatively quickly.
The applications
Mr Henry Carr QC appeared with Mr Mark Vanhegan QC on behalf of Samsung. He submitted that a part of the purpose of the central amendment procedure is to allow a patentee to consider a judgment in one designated state and, in response, to narrow the claims for all other designated states, and that is precisely what Samsung seeks to do here. He further argued that it was very likely that the central amendment applications would be decided before these proceedings were finally disposed of, and that were we to proceed to hear the appeal in the meantime there would be a real risk that the costs of so doing would be wasted. Accordingly, he invited us to adjourn the hearing of the appeal in order to enable the final form of the claims to be ascertained, and the parties to prepare accordingly.
Mr Guy Burkill QC, who appeared with Mr Thomas Hinchliffe on behalf of Apple, responded that the amendments now sought do not correspond to any of the amendments sought at trial, or to any existing granted claim or sub-claim. Further, these amendments could have been put before the judge but, because they were not, the parties did not address them in their evidence and the judgments did not consider them. As a result, if the central amendment applications were to be allowed, there would be no basis upon which this court could find the amended claims valid and infringed, and so set aside the judge's order for revocation and grant the relief which Samsung now seeks. The action would therefore have to be remitted for retrial on the amended claims. That, he argued, would constitute an abuse of the process of the court because Apple should not now be put to the trouble and jeopardy of a second trial. Accordingly, he continued, Samsung should be put to its election and either proceed with the appeal on the basis of the claims considered by the judge and meanwhile take no further steps with its applications for central amendment, or it should abandon this appeal and consent to the lifting of the stay of the order for revocation.
Consideration of these rival submissions must, we think, begin with a brief explanation of the legislative framework. This was not in dispute and the following summary is drawn in large part and with gratitude from the submissions of the parties.
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