Sycurio Ltd (formerly Semafone Ltd) v PCI-PAL Plc
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Bacon |
| Judgment Date | 25 September 2023 |
| Neutral Citation | [2023] EWHC 2361 (Pat) |
| Court | Chancery Division (Patents Court) |
| Docket Number | Case No: HP-2021-000030 |
[2023] EWHC 2361 (Pat)
Mrs Justice Bacon
Case No: HP-2021-000030
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY LIST (Ch)
PATENTS COURT
Rolls Building Fetter Lane
London, EC4A 1NL
Michael Silverleaf KC and Kyra Nezami (instructed by Michelmores LLP) for the Claimant
Guy Tritton, Edward Cronan and Laura Adde (instructed by Shepherd & Wedderburn LLP) for the Defendants
Hearing dates: 12–16, 21–23 June 2023
Approved Judgment
PROVISIONAL NON-CONFIDENTIAL VERSION
Note: Excisions in this Judgment marked “[✂]” relate to commercially confidential information.
This judgment was handed down remotely at 4.45pm on 25 September 2023 by circulation to the parties or their representatives by email and by release to the National Archives.
| Introduction | 3 |
| The issues | 3 |
| Witnesses | 4 |
| Preliminary comments | 4 |
| The Claimant's witnesses | 5 |
| The Defendants' witnesses | 7 |
| The skilled team | 8 |
| The law | 8 |
| The parties' positions as to the skilled team | 9 |
| The subject matter of the Patent | 9 |
| Common general knowledge | 11 |
| Call centre telephony systems | 11 |
| DTMF technology | 11 |
| Card payment processing | 12 |
| Security of payment systems | 13 |
| Techniques available for addressing fraud and the PCI DSS requirements | 14 |
| VoIP, SIP and RTP | 15 |
| The Patent | 16 |
| The disclosure of the Patent | 16 |
| Claim 9 of the Patent | 21 |
| Construction issues | 22 |
| Inventive concept | 26 |
| Validity | 28 |
| The law | 28 |
| Prior art relied on in this case | 29 |
| Van Volkenburgh | 29 |
| Shaffer | 32 |
| LiveOps | 37 |
| Conclusion on validity | 38 |
| Infringement | 38 |
| The law | 39 |
| Agent Assist | 41 |
| Section 60(1)(b) infringement on a normal construction | 41 |
| Section 60(2) infringement | 42 |
| Conclusion on infringement | 42 |
| The Agent Assist enhancements | 42 |
| Conclusions | 42 |
INTRODUCTION
This case concerns Patent GB 2473376 ( the Patent), entitled “Signal detection and blocking for voice processing equipment”, which concerns the processing of telephone calls within a call centre. The claim of the Patent in issue is claim 9, which claims a method of reducing fraud by call centre agents, by blocking DTMF tones entered by a caller from being transmitted to the agent when the caller is using the keypad to provide sensitive information required for a transaction, such as their payment card details. The priority date of the Patent is 9 May 2008.
The claimant ( Sycurio) is the proprietor of the Patent. It contends that the defendants (collectively PCI-Pal) have infringed and continue to infringe the Patent, either literally or under the doctrine of equivalents, by their cloud-based secure card payment system known as Agent Assist Gen 2 ( Agent Assist). Agent Assist is available in a variety of variants, and Sycurio contends that each variant infringes.
PCI-Pal challenge the validity of the Patent on various grounds, deny infringement, and (by way of counterclaim) seek declarations of non-infringement in relation to nine proposed enhancements of the Agent Assist system.
Mr Silverleaf KC and Ms Nezami appeared for Sycurio; PCI-Pal were represented by Mr Tritton, Mr Cronan and Ms Adde. Mr Silverleaf, Ms Nezami, Mr Tritton and Mr Cronan all made submissions at the hearing, and both sides provided detailed written opening and closing submissions. There were no witnesses of fact; there were, however, two experts for each party, who provided written expert reports and were cross-examined at the trial.
In light of the extensive materials before me for the trial, which included detailed discussion of the functionality of the Agent Assist systems (in both submissions and evidence), it was unfortunate that the implications of an important technical issue regarding the way in which Agent Assist worked only emerged as a point in dispute at the end of Mr Silverleaf's reply on the last day of the trial. It was then addressed in written submissions by both parties following the hearing. I will discuss this further below.
THE ISSUES
The issues in dispute slightly narrowed during the course of the trial, the remaining issues being as follows:
i) The subject matter of the Patent and accordingly the nature of the skilled team.
ii) The scope of the common general knowledge ( CGK), which was largely dependent on the identification of the skilled team.
iii) The construction of various points in claim 9.
iv) Identification of the inventive concept of claim 9.
v) Obviousness of claim 9 over US patent 2004/0193897 A1, published on 30 September 2004, referred to as Van Volkenburgh.
vi) Obviousness of claim 9 over US patent 2006/0050658 A1, published on 9 March 2006, referred to as Shaffer.
vii) Obviousness of claim 9 over a prior art press release by the company LiveOps, published in “destination CRM” magazine in January 2007, referred to as LiveOps.
viii) Whether claim 9 relates to excluded subject matter under s. 1(2)(c) of the Patents Act 1977, on the basis that it only discloses a scheme or method for doing business or a computer programme.
ix) Whether claim 9 contains matter extending beyond that disclosed in the original application for the Patent as filed.
x) Whether any of the Agent Assist variants infringe claim 9 under s. 60(1)(b) and/or s. 60(2) of the Patents Act 1977, on a normal construction or the doctrine of equivalents (and including the question of a Gillette/ Formstein defence based on obviousness over US patent 2005/0246242 A1, published on 3 November 2005, referred to as Proctor).
xi) Whether any of the Agent Assist enhancements infringe claim 9, and if not whether PCI-Pal should be granted a declaration of non-infringement.
As I will explain, I do not need to decide some of those issues in light of the way in which I have decided other issues in the case.
WITNESSES
Preliminary comments
Before commenting on the evidence of the expert witnesses for Sycurio and PCI-Pal, respectively, it is necessary to make some preliminary observations about the duties and responsibilities of expert witnesses in patent cases, and the corresponding obligations of the solicitors who assist those witnesses in preparing their evidence.
There is no dispute that an expert witness in a patent case is subject to the rules of CPR Pt 35. These include under r. 35.3(1) the duty of experts “to help the court on matters within their expertise”, and under r. 35.10(1) the requirement for an expert's report to comply with Practice Direction 35.
Practice Direction 35 includes the following requirements:
“2.1 Expert evidence should be the independent product of the expert uninfluenced by the pressures of litigation.
2.2 Experts should assist the court by providing objective, unbiased opinions on matters within their expertise, and should not assume the role of an advocate.”
The starting point in both CPR Pt 35 and the accompanying Practice Direction is therefore that the expert witness must give evidence on matters which fall “within their expertise”. That may of course require the expert to do some further research to enhance their existing knowledge in the field, so as to be able to assist the court with the specific issues in the case. An expert may also wish to do background reading in relation to a related field in which they do not profess specific expertise, so as to be able to understand the context of the questions which they are asked which do fall within their field of expertise, and thereby to give useful answers to those questions.
What the expert should not, however, do is to give evidence on the basis that they have sought to read in and educate themselves in the relevant field for the purposes of the case in question. A person does not become an expert by virtue of having acquired knowledge in the course of the case itself. Nor should an expert give evidence on a subject which falls outside their expertise, but which they consider they understand “well enough” to express a view on the matter. An expert is not instructed for court proceedings on the basis that they believe that they have “sufficient” grasp of the matter to express a view, or are able to teach themselves what they need to know in the course of preparing their evidence. They are instructed on the basis that they are a genuine expert in the relevant field, whose opinions may be relied upon and given weight by the court.
As to the process by which an expert report is prepared in a patent case, both parties agreed that the position was correctly set out by Arnold J in Medimmune v Novartis [2011] EWHC 1669 (Pat), §§99–114. In particular, both parties endorsed the propositions that the specialist nature of such cases and the likely fields of expertise of the expert witnesses instructed in such cases mean that expert witnesses in patent actions require a “high level of instruction by the lawyers”, and that in practice expert reports in patent cases are often drafted by the lawyers on the basis of what the expert has told them, with the expert then amending the draft report as appropriate (§110).
That process must not, however, obscure the duties of the expert as set out in CPR Pt 35 and Practice Direction 35. In particular it must not lead to an outcome where the expert strays into giving evidence on matters falling outside their expertise, on the basis that they have been asked questions by their solicitors which they have endeavoured to answer. That is an outcome which both the expert and their instructing legal team must be vigilant to avoid. The instructing solicitors should not simply assume that the expert will understand the requirements of...
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