Software Solutions Ltd (a company incorporated under the laws of the British Virgin Islands) v 365 Health and Wellbeing Ltd

JurisdictionEngland & Wales
JudgeMelissa Clarke
Judgment Date09 February 2021
Neutral Citation[2021] EWHC 237 (IPEC)
CourtIntellectual Property Enterprise Court
Docket NumberClaim No: IP-2016-000011
Date09 February 2021
Between:
(1) Software Solutions Limited (a company incorporated under the laws of the British Virgin Islands)
(2) Mindlife Solutions Limited (a company incorporated under the laws of Israel)
(3) Mindlife (UK) Limited
Claimants
and
(1) 365 Health and Wellbeing Limited
(2) John Frederick Smith
Defendants

[2021] EWHC 237 (IPEC)

Before:

HER HONOUR JUDGE Melissa Clarke

Sitting as a Judge of the High Court

Claim No: IP-2016-000011

IN THE HIGH COURT OF JUSTICE

BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES

INTELLECTUAL PROPERTY LIST (ChD)

INTELLECTUAL PROPERTY ENTERPRISE COURT

Rolls Building

New Fetter Lane

London

Mr Jaani Riordan (instructed by Rechtschaffen Law) for the Claimants

Mr Guy Tritton (instructed by Hill Dickinson) for the Defendants

Melissa Clarke Her Honour Judge

A. INTRODUCTION

1

The Claimants claim that the Defendants have infringed copyright and database right in a computer application development framework known as the ‘Integrated Development Environment for Applications’ (“ IDEA System”) by marketing a mental health application called Beating the Blues (“ BTB”), and specifically version 5 of BTB (“ BTB v5”). Both the IDEA System and BTB are written primarily in the Java programming language.

2

The IDEA System was developed utilising the XML format to create/structure, validate and run applications created using the IDEA System. Three of the main components of the IDEA System can be described as follows:

i) the IDEA Editor, or authoring software, which allows the author-user creating an application to define the ‘frames’ and ‘trees’ of the application and creates XML files which conform with the XML data formats developed as part of the development of the IDEA System and referred to in the pleadings and the evidence collectively as the “XML Schema”;

ii) the IDEA Engine, which deciphers XML files which have been encoded according to the XML Schema, renders the results for the user, and handles the data flow between different parts of the system; and

iii) the IDEA Player, which processes the XML files and ‘plays’ them according to the sequence of IDEA commands encoded within them.

3

The ‘Beating the Blues’ or BTB application was the first application built using the IDEA System. It is a mental health self-help tool which provides end-users with a clinical programme aimed at treating depression by means of a series of eight self-guided sessions. It is not disputed that it was initially developed by the Second Claimant, and the rights in BTB versions 1 and 2 were assigned by the Second Claimant to Ultrasis plc in 2002.

B. MATTERS CONCEDED AND WHAT REMAINS IN DISPUTE

4

The claim was issued in January 2016. The Defendants filed a Defence which, broadly, (i) denied that BTB v5 infringed the Claimants' rights, asserting that in 2004/5 it had been completely rewritten from the versions created by the Second Claimant; and (ii) asserted that the Defendants had acquired all intellectual property rights in BTB v5 from the administrators of the Ultrasis group of companies in 2015.

5

After a significant delay which appears to have arisen mainly, but not entirely, from the Defendants disputing the Claimants' request for disclosure of the source code of BTB v5, computer experts were instructed by each side. A CMC took place before HHJ Hacon on 29 November 2019 which identified (and to a certain extent limited) the issues to be determined at trial. Expert evidence was then served sequentially. About a month before trial, being some 5 years after the dispute arose, and four years after the claim was issued, the Defendants notified the Claimants that they did not intend to serve any fact evidence and conceded liability on a number of issues.

6

Although the Defendants have made no formal admissions, the effect of the Defendants' concessions (and further clarification provided in subsequent correspondence between the parties and their legal advisors and at trial) means that the following is now common ground:

i) Copyright subsists in the IDEA System, each of its components and its source code;

ii) Copyright also subsists in the XML Schema as a literary work;

iii) The First Claimant is and has been since 2005 the owner of all copyright subsisting in the IDEA System and each of its components, (but not the XML Schema which the Defendants deny is part of the IDEA System or owned by the First Claimant):

iv) BTB v4, and BTB v5 as marketed by the Defendants, reproduces the IDEA System source code materials and XML Schema;

v) A licence granted by the Claimants to Ultrasis plc in 2002 terminated upon the insolvency of Ultrasis plc in June 2015, and was ineffective to convey any rights to the Defendants to use the IDEA System source code;

vi) It follows that all of the First Defendant's dealings in BTB v5 infringe the copyright of the Claimants in the IDEA System source code;

vii) The Second Defendant is jointly liable with the First Defendant for the admitted copyright infringement (and any further copyright or database infringement which the court may find).

7

Those concessions dispose of the majority, but not all, of the claim. The issues which remain for me to determine are very narrow:

i) What is the XML Schema? Is it properly to be characterised as part of the IDEA System or part of the BTB application developed using the IDEA System?

ii) Who owns the rights in the XML Schema? If the answer is the Claimants, the Defendants admit that BTB v5 infringes the copyright and any database rights that the court finds to exist in the XML Schema;

iii) It being accepted by the Defendants that copyright subsists in the XML Schema, whether database rights also subsist in it;

iv) What factual findings the Court is able to make which may be relevant to the consideration of additional damages under section 97(2) of the Copyright, Designs and Patents Act 1988 (“ CDPA”) and/or Article 13(1) of Directive 2004/48/EC (“ Enforcement Directive”).

8

There are a few other minor consequential matters which remain outstanding in relation to the scope of the order that the Court will make.

C. THE IDEA SYSTEM AND BTB

9

This section provides a high-level summary and explanation of the IDEA System and the BTB v5 software. I do not understand it to be contentious or disputed by the Defendants, but to the extent that it is, it is based upon evidence from the Claimants' witnesses which I accept.

10

The IDEA System is an advanced software authoring tool, which computer-assists users to develop and deploy multi-media applications using generic components without the need for such authors to know how to programme themselves, or even to understand the underlying engineering. At the time of its development, the IDEA System offered market-leading capabilities.

11

The purpose of the development of the IDEA System was to create “a comprehensive integrated environment for interactive multimedia, mental health applications which will enable us [the Claimants] to develop, maintain and change any common psychological intervention and assessment and deliver it in a reliable and appealing way to the end user”. In particular, it allowed development of self-help mental health applications based on cognitive behavioural therapy (“CBT”) for conditions such as anxiety and depression.

12

The IDEA System is made up of a number of components. It can be used in authoring mode to produce applications (using the IDEA authoring software, or IDEA Editor), and then in runtime mode to run applications which have been built on top of the IDEA Engine and IDEA Player, utilising those two components and the Runtime player.

13

Applications which are built using the IDEA System are presented to end users using graphical elements such as buttons, tags, etc to enable them to navigate through the application. These are generic components available to anyone who writes (or ‘authors’) an application on the IDEA System, and it is the application author who chooses which graphical components to use from the options that the IDEA System makes available, depending on how he or she wants it to look to the end user and what functionality he or she wants to make available to the end user. However, the content that is presented to end users of the application, such as text, images, audio and video content, is provided by the application author and not by the IDEA System (“author-provided content”).

14

To that extent, and to aid understanding, a comparison can be drawn with Microsoft's Powerpoint: the Powerpoint program enables authors to produce a slide presentation without having any idea of programming or the underlying engineering. The user who wishes to author a Powerpoint presentation can choose from Powerpoint's menu of options: to structure the presentation by choosing the number and flow of slides; to choose the template of the slides (layout, whether they have textboxes or graphics boxes or both etc.); and to add formatting options and effects. All of these are generic components and functions of the Powerpoint application, available to all authors, although an author will only choose a sub-set of those available options in any given presentation. However, the author chooses and inserts his own (or third party) content into the Powerpoint to create the presentation.

15

The ‘Beating the Blues’ or BTB application was the first application built using the IDEA System. It is a mental health self-help tool which provides end-users with a clinical programme aimed at treating depression by means of a series of eight self-guided sessions. It was initially developed by the Second Claimant, through a single employee called Ms Svetlana Berg who was not a programmer, and not part of the IDEA System development team. There is some dispute about the authorship of some of the audio and videos clips forming part the content of the BTB application delivered to end users, but it is common ground they were not...

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