The Noco Company v Shenzhen Carku Technology Company Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Lewison,Lord Justice Arnold,Lady Justice Falk |
| Judgment Date | 19 December 2023 |
| Neutral Citation | [2023] EWCA Civ 1502 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: CA-2022-001980 |
[2023] EWCA Civ 1502
Lord Justice Lewison
Lord Justice Arnold
and
Lady Justice Falk
Case No: CA-2022-001980
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY LIST (ChD)
The Hon Mr Justice Meade
Royal Courts of Justice
Strand, London, WC2A 2LL
Andrew Lykiardopoulos KC and Adam Gamsa (instructed by Jones Day) for the Appellant
Hugo Cuddigan KC and Edward Cronan (instructed by Powell Gilbert LLP) for the Respondent
Hearing dates: 12/12/2023
Approved Judgment
This judgment was handed down remotely at 11.00am on 19/12/2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
Introduction
The issue on this appeal is whether communications between The NOCO Company (“NOCO”) and Amazon amounted to a “threat of infringement proceedings” for the purposes of section 70 of the Patents Act 1977. Meade J held that they did. His judgment is at [2022] EWHC 2034 (Pat). Most of his judgment concerned the question whether the patent in suit was valid and infringed. He found that it was invalid for obviousness, and was therefore incapable of infringement. There is no appeal against his conclusions in that respect.
The facts
NOCO and Shenzhen Carku Technology Co Ltd (“Carku”) are rival manufacturers of, among other things, lithium-ion batteries for jump-starting a motor vehicle with a flat battery. NOCO was the proprietor of a patent (GB 2 257 858) in respect of such a product. On 6 June 2022 Carku launched proceedings for a declaration of non-infringement of the patent; a declaration that the patent was invalid; the revocation of the patent and relief against unjustified threats of infringement. NOCO counterclaimed for infringement of the patent. It was that patent that the judge held to be invalid for obviousness, although he also held that, if it had been valid, it would have been infringed by some of Carku's products (although not the Carku products in issue in this appeal).
Carku supplies products to distributors, who market the products via Amazon. Amazon has an “Amazon Intellectual Property Policy” which states that it provides protection and safeguarding measures for intellectual property rights holders. Under this policy, any proprietor of intellectual property rights is able to file complaints with Amazon via its website using an “Infringement Form”. Amazon also operates what is called a “Brand Registry”, which companies have to register to use (i.e., it cannot be accessed by all rights owners as a matter of course). NOCO has a first party (“1P”) relationship with Amazon (meaning that Amazon buys products directly from NOCO to sell on Amazon's own account) and is registered with the Brand Registry. NOCO's status as a 1P partner also means that NOCO has been allocated a contact person at Amazon, referred to in NOCO's evidence as a category manager. Amazon's Brand Registry covers all intellectual property rights, including patents.
Amazon's conditions of use and sale (as at 29 January 2020) provided:
“9. INTELLECTUAL PROPERTY CLAIMS
Amazon respects the intellectual property of others. If you believe that your intellectual property rights had been used in a way that gives rise to concerns of infringement, please follow our Notice and Procedure for Making Claims of Right Infringement.”
“19 NOTICE AND PROCEDURE FOR MAKING CLAIMS OF RIGHT INFRINGEMENTS
If you believe that your intellectual property rights have been infringed and you are eligible for Brand Registry, please sign up to that service and submit your complaint via Brand Registry. Otherwise please submit your complaint using our online Notice Form form. This form may be used to report all types of intellectual property claims, including, but not limited to, copyright, trademark, design and patent claims.
Upon receipt of a complaint we may take certain actions, including removing information or an item… All such actions are taken without any admission as to liability and without prejudice to any rights, remedies or defenses, all of which are expressly reserved. This includes forwarding the complaint to the parties involved in the provision of the allegedly infringing content. You agree to indemnify Amazon for all claims brought by a third party against Amazon arising out of or in connection with the submission of a complaint.”
The Q & A section of the Brand Registry policy includes the following:
“Amazon does not allow listings that violate the intellectual property rights of rights owners. For detailed information, please review Amazon's Intellectual Property (IP) policy. We encourage rights owners who have concerns regarding the misuse of their intellectual property to notify us using the Report a Violation tool in Amazon Brand Registry.”
In relation to some US patents Amazon also offers a neutral evaluation process. This a consensual process between patentee and alleged infringer which enables proprietors of certain US patents to obtain an evaluation of their patent infringement claims against third party sellers. It is a condition of use of this procedure that both parties waive all claims against Amazon, and agree not to sue Amazon. The evaluation is carried out by a neutral third party. The evaluator will produce a yes/no decision about whether the impugned product infringes the patent. If the evaluator concludes that an impugned product is covered by a patent, Amazon will remove it. But Amazon may allow relisting if the seller obtains a judgment or arbitration award to the effect that the impugned product does not infringe. This is not a procedure that was used in this case, although it is said to show that Amazon is both litigation aware and litigation averse.
Between January and July 2020, NOCO made a number of complaints via the “Infringement Form” in respect of certain Carku products, providing the following information:
i) The type of intellectual property rights e.g. “patent infringement”;
ii) The marketplace (i.e. country);
iii) The infringing ASINs (Amazon Standard Identification Number);
iv) The patent number;
v) The patent type (i.e. for those countries which have both design and utility patents); and
vi) The brand name.
The ASIN is used to identify the impugned product and can also be used to identify the seller of it. The form also has an “Additional Information” box of up to 3000 characters. There was a minor (and unexplained) discrepancy between the rubric of the standard form and the forms that NOCO apparently completed. In the standard form, the rubric was “Please provide more information on how the reported product(s) are infringing your patent right”. The rubric on the form completed by NOCO, however, was simply “Additional information.”
In the majority of cases NOCO filled in that box in one of the following forms:
“These ASINs infringe on our utility patent, number GB2527858. Please remove these ASINs” or
“The registration number for our utility patent is GB2527858. Please remove these ASINs”
In June 2020, however, different wording was used in the complaints. It took the following form:
“These ASINs infringe on our patent. We have a legal letter from Amazon's legal team stating the legitimacy of this claim. I will esculate [sic] this case to provide that letter. Please remove these ASINs.”
The reference to a letter from “Amazon's legal team” is a reference to a letter dated 12 May 2020 sent by Hogan Lovells (solicitors for Amazon) to Carku's solicitors, Powell Gilbert. This was sent following correspondence between Amazon and Carku (not all of which was shown to the judge), in relation to Amazon's decision to delist the notified Carku products following the notifications made by NOCO. In this letter, Amazon indicated that it had “assessed the patent infringement and the other allegations presented by each party” and “concluded that those made by NOCO regarding the infringement of its patent (and the non-infringement of Car-ku's [sic]) are sufficiently grounded…”.
The first (and largest) batch of complaints were made on 2 and 8 January 2020. The second batch came at the end of January. Further complaints were made between 3 and 13 February and again in mid-June; and the last were made in early July. While this series of complaints was in the course of being made, on 3 February 2020 Mr Nook of NOCO sent an email to NOCO's designated contact at Amazon in which he stated that NOCO “do continue to file lawsuits against companies that infringe on our safety patent”. Having named relevant distributors who distributed the impugned Carku products, he went on to say that NOCO had won some cases against them and reached settlement in others.
As a result of the notifications made by NOCO, Amazon notified Carku distributors, beginning in January 2020 that it had removed some of Carku's products from sale because they had received a report from a rights owner that they infringed a patent (the number of which was given). They were also notified that they could “reach out to the rights owner” and ask for a retraction of the notice. The distributors, in turn, informed Carku. NOCO made no direct approach to Carku.
The consequence of the removal of Carku's products from the Amazon site was, according to Carku, a very substantial loss in sales.
The statutory provisions
As Mr Cuddigan KC correctly pointed out, neither a product nor a process infringes a patent. On the contrary, section 60 of the Patents Act 1977 provides that “a person infringes a patent” if, without the consent of the patentee, he does one or more of a number of things specified in that section. Where the invention is a product, they include disposing of or...
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