Does Grim[m]e pay?

This article was included in the spring 2011 issue of Innovate - the patents newsletter and the spring 2011 issue of snIPpets - the intellectual property newsletter.

In a case concerning allegations of infringement of a patent relating to a potato harvesting machine, the Court of Appeal has given some helpful guidance on the application of the contributory infringement provision under section 60(2) Patents Act 1977 (Grimme Maschinenfabrik GmbH & Co KG v Derek Scott [2010] EWCA Civ 1110).

In a judgment which partially overturned the first instance judgment, the Court of Appeal concluded that the claimant’s patent was wholly valid and that Mr Scott's machine sold with rubber rollers fell within claim 1 and thus its sale and offering for sale was a direct infringement under section 60(1) Patents Act 1977.

The Court of Appeal then went on to consider in detail whether Mr Scott was liable for contributory infringement under section 60(2) Patents Act 1977. This occurs in certain circumstances where a person supplies or offers to supply in the UK any of the means, relating to an essential element of the invention, for putting the invention into effect when he knows, or it is obvious to a reasonable person in the circumstances, that those means are suitable for putting, and are intended to put, the invention into effect in the UK.

As well as selling machines with rubber rollers that fell within claim 1 of the patent, Mr Scott also sold machines with steel rollers (which did not fall within the claim). However, Mr Scott manufactured the machines so that steel and rubber rollers were interchangeable and they were marketed on that basis. 

The issue for the Court of Appeal to decide was whether sales or offers of sale by Mr Scott of a machine with a roller made of steel, rather than rubber, gave rise to contributory infringement. Mr Scott appealed the first instance ruling that he was liable for contributory infringement under section 60(2) arguing that, for infringement to occur under that section, there must be proof that he knew that, or the circumstances made it obvious that, the user actually intended to make the switch.

In its judgment on this issue, the Court of Appeal gave some useful guidelines on the application of section 60(2).

1. Section 60(2) is intended to apply to products which are capable of being used in a manner which will not constitute a direct infringement within section 60(1). Therefore, the supply of a steel-rollered machine, which is designed and promoted to enable the steel rollers to be changed for rubber rollers, was plainly the supply of the means by which that can be achieved and is the supply of a means essential for that purpose. 

2. Section 60(2) requires that the supplier "knows ... that those means ... are intended to put the invention into effect". The person who must have the intention to put the invention into effect is the person at the end of the supply chain, not the supplier. The question is what the supplier knows or ought to know about the invention of the person who is in a position to put the invention into effect, namely the person at the end of the supply chain. 

3. Even if the person supplied by the alleged infringer is an intermediary who does not have the intention to put the invention into effect, liability may still arise under section 60(2) if the supplier knew, or it was obvious in the circumstances, at the time of his offer to supply or supply that some (disregarding freak use) ultimate users would intend to use, adapt or alter the "means essential" so as to infringe. In coming to this decision, the Court of Appeal followed decisions of the German courts, making extensive reference to a judgment of the German Supreme Court. 

The Court of Appeal summarised its position on contributory infringement as follows:

"the knowledge and intention requirements of Art. 26 [the provision in the Community Patent Convention corresponding to section 60(2)] and section 60(2) are satisfied if, at the time of supply or offer of supply, the supplier knows, or it is obvious in the circumstances, that ultimate users will intend to put the invention into effect.  That is to be proved on the usual standard of balance of probabilities. It is not enough merely that the means are suitable for putting the intention into effect (for that is a separate requirement), but it is likely to be the case where the supplier proposes or recommends or even indicates the possibility of such use in his promotional material."

In upholding the finding of contributory infringement against Mr Scott, the Court of Appeal noted that Mr Scott had sought to enhance his sales by pointing out that users could adapt the device for less stringent conditions by a simple modification. He sold the means for that too. Mr Scott knew that users would intend to make their devices infringing if it suited them and positively encouraged that intention. 

The Court of Appeal also commented on remedies for contributory infringement. In particular, it did not think it appropriate to order an injunction which attempts to spell out what it is that the defendant can do. It is up to the defendant to work out how to ensure that there is no ultimate infringement. Contempt proceedings can be launched if the defendant's steps turn out to be ineffective. In relation to financial remedies, the Court of Appeal remarked that the defendant's sales should not be treated in the same way as if they were sales of products which actually infringe. As for quantum, this will depend on the degree to which the ultimate users adapt or intend to adapt the device so as to infringe.