England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice The Rolls Building 7 Rolls Buildings London, EC4A 1NL
		10th December 2012

MR. JUSTICE MANN :

Introduction.

1. This is an application for an interim injunction in a claim based on and in relation to two UK patents, passing off and trade mark infringement. In this application only the alleged patent infringement is relied on. Mr. Alistair Wilson QC, representing the claimant, indicated that, notwithstanding the terms of his skeleton argument, he was not pressing passing off or trade mark infringement in this application. In my view, that was a realistic approach.
2. The claimant is the patentee under two UK patents, number 2453588B and number 2486100B. For the purposes of the issues which are raised in this application, it is unnecessary to treat them separately. All the issues that arise can be dealt with on the one or the other and the debates before me took place on the footing that the first of those two patents was the relevant one. I shall therefore for present purposes ignore the latter.
3. The defendants are companies or certain individuals who are associated with and/or officers of them against whom infringement or infringement related claims are made. The present application is an application made against the first two defendants only on the footing that they are infringing the patent by selling or otherwise disposing of articles in this jurisdiction. Those defendants do not dispute that they have performed acts which, if the products infringe, amount to an infringement of the patent. They do, however, say that their products do not infringe and go so far as to say that there is no arguable case for infringement. The validity of the patents is not attacked. The dispute is all about infringement. The issues on this application were the familiar ones of whether or not there is a good arguable case and, if there is, where the balance of convenience lies in terms of the relative disadvantages to the parties and their compensatability in damages.

The Patent.

4. The patent addresses the problem of the safe and accurate provision to individuals in care homes of their daily medication. It is in the interests of the care homes and their residents that daily tablets and liquids be provided efficiently and accurately. There are obvious risks if the care home has to administer large numbers of separate medicines contained in bottles and packets and administered two, three, or four times a day to the residents. It might get it wrong. There might be uncertainty as to whether a resident has had his or her medication or not. The drugs might get contaminated. There are others.
5. To overcome the obvious problems involved with all that, various solutions have been devised to pre-package each periodic dose for each resident so that on any given occasion all the medication, which might be several tablets and a liquid, is immediately and readily available for the resident in question in a pre-packaged form, packaged for that administration occasion. In the words of the specification:

"Conventionally, and particularly in care homes, it is necessary for large numbers of such bottles to be stored, and this takes up considerable space. Furthermore, since the medication is contained in a large bottle then as the quantity in the bottle diminishes an increasing air space above the liquid is created which can adversely affect the chemical properties of the medicine.

It is an object of the present invention to provide a system of accurately and conveniently packaging individual doses of medication, whether in liquid or tablet form, and which is more easily managed in a safe and convenient manner, thus substantially avoiding the aforementioned difficulties."

6. The patent seeks to address this difficulty by providing for a tray with a number of deep recesses — I use the neutral word "recesses"deliberately on this occasion — each capable of holding a small pot. The pots are placed in the recesses ("compartments") and the medicine on each dosing occasion is placed in advance in each pot. A non-permeable sheet is placed over the tray and array of pots and is stuck down so that it seals each pot. There are perforations in the plastic sheet around the edge of each pot enabling the pot to be popped out. The bit of plastic sheet adhering to the top of the pot is then peeled back and the tablets or liquid within can then be taken.
7. In the actual use of this patent in the real world, the top part of the sheet on top of each pot contains details of the drugs within, as provided in claim 10 of the patent, and on the outside of the tray which holds the pot there appears the name, and sometimes even a photograph, of the taker of the tablets. In this way, the availability of the right tablets in the right dosage at the right time to the right recipient is said to be made more secure.
8. In the claimant's exploitation of the patent, the plastic sheet is heat-sealed to the top of the pots and the upper surface of the tray but the method of sealing is not specified by Claim 1. Claim 1 of the patent provides as follows:

"A monitored dosing system container for discretely packaging a plurality of quantities of one or more fluid or solid medications, comprising:

a tray having individual spaced compartments,

a plurality of pots individually removably received within the respective compartments, wherein each pot has an upper flange and is adapted to contain a medication to be packaged,

means to releasably retain the pots in the compartments prior to intended release, and

means to sealingly retain the medication in the pots prior to its intended use; wherein the means to sealingly retain the medication in the pots comprises a flexible perforated sheet of non-permeable material placed over the filled tray and sealingly attached to and across an otherwise open top of each pot, and wherein the perforations coincide with the outer peripheries of the pots so as to define individual sealed films across each pot, and once the pot is removed the sealed film can be peeled off the upper flange to open the pot."

9. Claim 7, which is said to be relevant to construction, provides:

"A container according to any preceding claim wherein each compartment has an aperture in a base region thereof to enable the associated retained pot to be pushed out of its compartment."

10. A visualisation of a preferred embodiment of the invention appears in Fig. 1 of the specification and is, or will be, attached to this judgment as Annex 1. One can see there the tray with a 7 x 4 array of depressions (again "compartments") into each of which the pots are placed and the plastic sheet is then placed over the top in order to form a seal. In the real world, the contents of each pot are made up by pharmacies. Pharmacies collect prescriptions for care homes, enter them into relevant software, and place the relevant tablets and liquids in the pots and trays. Computer software prints out appropriate labelling on top of each pot and on the tray. The assembled trays are then presented to the relevant care home which then simply administers the drugs in accordance with the labels on the tray's pots, removing them as appropriate. Thus is the treatment of the residents simplified and made safer.

The alleged infringing product.

11. The defendants market and sell a product with a similar end goal of providing small pots containing each periodic dose of medicine and again they aim to get these products into care homes via pharmacies. Their product also comprises an array of pots with a sealed plastic film covering the top of a tray containing them and adhering to the flange on the pots and each pot is supported by plastic, which for these purposes is accepted to be a "tray".
12. The retention of the pots in the defendants' tray is achieved in a manner which is said by the defendants to be different. They do not sit in separate shaped 3D compartments. Rather, they sit within what are essentially holes cut out of a flat tray but are joined to the inner faces of those holes by small pieces of plastic at a limited number of points around the flange of each pot. It seems that the whole assembly is achieved in a pressing or moulding and that the edge of the flange of each pot is cut through almost completely, leaving the retaining tabs holding each pot in place. A sheet of plastic is placed over the whole assembly (pots and trays), again with perforations aligned around the edge of each pot. This plastic is stuck on with adhesive, not by heat sealing. One removes each pot by pressing downwards, at which point the small plastic tabs fixing it to the tray break, the pot falls free, the plastic film lid can be peeled back, and the drug administered.

The dispute on infringement.

13. The defendants, through Mr. Wyand QC, say that there is no good arguable case in favour of infringement and thereby raise a dispute on the first limb of American Cyanimid. They accept for these purposes that their product fulfils the opening words of Claim 1 up to "solid medications, comprising", that their product has pots and that they are individually spaced on a tray. They also accept for present purposes that the integer or integers relating to sealing in the second half of Claim 1 are also apparent in their product. However, they dispute that their product has "individual spaced compartments", with "a plurality of pots individually removably received within the respective compartments".
14. They say that Claim 1 requires a tray, compartments, and separate pots within compartments. Their product contains a tray and either compartments (in the form of pots) but not pots, or pots but no compartments, but does not contain both pots and compartments and certainly not pots "received within….compartments". They say that this is sufficiently clear that it can be determined at this stage that the claimant does not have a good arguable case.
15. Mr. Wilson says that such arguments vest the significance of separate compartments and separate pots with too much importance. The essence of the invention is what happens after the whole package is put together. It enables the removal of a sealed package/pot which remains sealed until the moment the medicine is taken. The purpose of the invention is to give the care attendant and the patient a complete pot with the medicine in it, which is secured, organised, and rationally labelled in a tray up to the point at which the pot is pressed out, or pushed out. In his words, the requirement of a separate compartment is an irrelevance so its absence does not matter. Alternatively, he submits that in fact each of the defendants' trays is indeed compartmentalised: it has defined areas for holding vessels which can be viewed as compartments. On this analysis each hole from which the defendants' pots hang is as much a compartment as it would be if plastic were drawn down from beneath each hole to form something with sides that the defendants would have to accept was a compartment. The only difference, which is not a material one, is that the vertical component of the compartment is merely the thickness of the plastic surface of the tray. To require a compartment to have more and to have more of a 3D aspect is to vest the notion of compartment with an excessive 3D quality. He points to dictionary definitions which indicate that a compartment does not have to have a 3D aspect. Furthermore, even if what he says is the compartment in the defendants' tray has only a 2D aspect, that does not prevent it from being a compartment.

Is there a good arguable case on infringement?

16. Mr. Wilson's case thus has two limbs. First, he says that separate pots and compartments are not on the true construction of the patent required; second, he says that if they are required then the defendants' product has both. I shall take those two arguments separately.
17. As to the first, I consider that Mr. Wilson's argument fails and fails clearly. The wording of Claim 1 is apparently quite clear. There has to be a tray with something called "compartments" and there then have to be pots which go into ("received within") the compartments. The plain wording of Claim 1 hardly allows for any controversy on the point. Claim 2 seeks to protect:

"a container according to claim 1 wherein the compartments are preformed integrally with the tray."

18. The clear emphasis of that is on separate compartments. A 3D compartment is also plainly anticipated by Claim 7 quoted above. That plainly contemplates that the compartment will have some serious dimensional substance, such that it has sides and a base albeit that the base has a hole in it. That compartment with substance is separate from the pot within.
19. As Mr. Wyand correctly submitted, there is nothing in the specification which points away from the apparent plain meaning of all those words and, although the wording in the specification generally relates to a preferred embodiment, it is fair to treat it as pointing the other way; that is to say, in favour of the defendants' submissions. Thus the wording, which cross-refers to the figure annexed to this judgment, explains the embodiment as follows:

"Referring now to Figs. 1 and 2, a container made in accordance with the invention comprises a tray generally indicated at 10, of a plastics material and formed to define side walls 11 and an array of individual preformed, side-by-side compartments 12 each having an opening 13 at its base and a common upper platform 14 extending across the tray 10 between the compartments 12. A front wall 15 provides a surface for the display of data concerning the contents of the tray and a lip 16 enables the tray to be withdrawn from an outer container to be described."

20. While that does not completely govern the claims, it does not help Mr. Wilson and he gains no support from any other wording in the specification. It may or may not be the case that the requirement of both compartments in a real 3D sense, and pots within, is essential to secure the end result of a self-contained sealed pot containing medicine being presented to the patient. What matters for these purposes is the wording of the claim. The draftsman of the claim sought to specify both compartments and pots and any infringing article has to have both. As Terrell on Patents (17^th Edition) observes in relation to a limitation of doubtful purpose, at paragraph 938:

"Hoffmann LJ held in STEP v Emerson [1993] RPC 513, 522 that it was wrong to ignore such a limitation or treat it as struck out simply because it appeared to make no difference to the inventive concept for it may have some purpose buried in the prior art and even if this is not discernable the patentee may have had some reason of his own for introducing it."

21. That seems to me to apply to the present case. Mr. Wilson submits that the patentee cannot necessarily think of everything and would draft the patent differently had he been aware of the present issues. That may or may not be the case but the patent is drafted as it is. I can see no reason at all for departing from the clear wording of the patent and its clear expression of limitations which require both compartments and pots, the latter being placed within the former.
22. So that leaves Mr. Wilson's argument that his trays do indeed contain compartments in the form of holes within it which are technically 3-dimensional features, if the number of dimensions matters. I detected that this was something of a fallback argument if his first argument did not succeed and, in my view, it has no greater merit. It is not apparent that the tray without the receptacle part ever existed as a separate entity so the holes, if compartments, never subsequently received pots but, in any event, in my view, the tray with holes in is not aptly described as a tray with compartments. It is a tray with holes. This argument is not improved by the fact that the holes have, inevitably because they exist in a physical product, a defined physical boundary of some thickness. It is still in this context a hole and not a compartment. It is a misuse of the English language in this context to come to a contrary conclusion and it is not required by the wording of the patent.
23. Mr. Wilson's case is not improved by resort to dictionary definitions. It is true that some definitions allow a construction of the word "compartment" to include apparent 2-dimensional divisions. Thus Webster's Dictionary contains the following:

"a subdivision of a plane surface as (a) a separate division of a structure or design (as a panel or coffer in a sealing or a….; subdivision of a portal). The subdivision aspect of a series of abstractions, an integrated organisation or a body of knowledge."

24. The latter of those is an abstract, almost metaphorical, use of the concept and does not help. The former shows that in certain contexts a compartment can have a 2-dimensional aspect but I have to construe the word in the context of the claims and, in my view, the claims require a significant 3D element to any "compartment". The same point can be made in relation to the Shorter Oxford English Dictionary definition:

"1. A division or separate part, originally of a design; a division separated by partitions…. a discrete section or feature of a formal garden".

25. Context is always important and I do not consider that the context of the claims allows these particular definitions to apply. The dictionary goes on to suggest other definitions ("a partition type division of a railway carriage; a watertight division of a ship") which do have a 3D connotation. That 3D connotation is much more appropriate to the claim.
26. It therefore seems to me that, on the material and arguments placed before me at the hearing of the application, the claimant's arguments on infringement are wrong and the defendants' arguments are right. That, however, by itself might not be sufficient to enable the defendants to succeed. The question is whether I am satisfied that the defendants are so right that there is no arguable case against them on infringement. I consider that that is indeed the case. This is not a complicated patent. There is no real prospect that any relevant evidence or other material would be adduced at a trial which would assist in the exercise of construing Claim 1. The exercise of construing it so as to judge the infringing nature, or otherwise, of the defendants' product is sufficiently straightforward to allow me to reach a clear view on the material that I have. My clear view is that the claimant does not have an arguable case on infringement. In those circumstances, the claimant does not get over the first hurdle in American Cynamid and is therefore not entitled to an interim injunction.

The balance of convenience.

27. Since the claimant does not get over that hurdle it is not strictly necessary for me to go on and deal with the balance of convenience in American Cynamid terms. However, in case it should be relevant I will deal briefly with the point. The case of the claimant was that, if the defendants were not restrained, the claimant would sustain significant loss between now and a trial which would be difficult to quantify fairly and which, in any event, the defendants would not be in a position to pay. The loss was said to arise not merely from trade lost to competition. The claimant's evidence is that it is a company which has newly started to develop its patent and in which the business of developing the patent is at a crucial stage. It has traded for several years and while losses have been made in each year of trading so far, it is about to break even and start to reap real returns on its significant investment. I find that the figures do indeed show a very significant investment. It was said that the continued intervention of the defendants in the trade would not only provide competition which would prevent the claimant achieving its commercial breakthrough in this respect; it would be likely to damage the business of the claimant because the product of the defendants is said, by the claimant, to be inferior and capable of damaging the reputation of the claimant's goods. If this were to happen and to prevent a breakthrough to profit, there is a danger that the claimant's project will collapse.
28. The inferior quality of the defendants' product is said to arise from its general quality, flimsiness, its inability to seal so as to protect hygroscopic medicines from absorbing atmospheric moisture, its inability to retain liquids, and the sticking of tablets to the sticky top seal. The damage to the reputation of the claimant's products is said to arise because the ultimate users of the product, the care homes, fail to distinguish between the claimant's actual product, called Biodose, and the defendants' product, called Multimeds. That leads to damage to the claimant's reputation because, it is said, care homes associate problems with what they are looking at (Multimeds) with the claimant. As a result, although the empty trays are supplied to pharmacies and not to care homes, nonetheless care homes are entitled to specify how their drugs are to be packaged and they will be more reluctant to specify Biodose. The loss arising from this damage to the claimant's reputation could be large and would be hard to quantify. Furthermore, it is said to be apparent from the evidence that the defendants would not be good for any substantial damages. On the other hand, the claimant says that damages on the cross-undertaking would be an appropriate remedy for the defendants. The damages would be quantifiable, one could see how they did once they are allowed to start up (assuming that they win the ultimate action), and the claimant is demonstrably good for any damages they are likely to sustain. The measure will be lost profit and lost business opportunities.
29. Mr. Wyand, for the defendants, disputed elements of the damage that would be done to the claimant were his client to be allowed to carry on trading. He pointed to deficiencies in the evidence of loss of reputation and relied on the fact that lost business could be quantified. He did, however, accept that notwithstanding those deficiencies it might be said that to a degree the loss to the claimant, like a loss to his clients, would be difficult to quantify. He did accept, however, that his clients would not be good for any substantial damages. He also accepted that, in principle, the claimant could suffer compensatable loss where its reputation is damaged by the presence on the market of something that turned out to be an infringing product which was inferior to the claimant's, but he disputed the likelihood of that on the facts. So far as his own clients were concerned, if they were forced off the market now, they would suffer obvious financial loss and further serious reputational loss of their own, including reputational loss in other markets, including Ireland where they would seek to use their product.
30. My conclusions in relation to this area of the case are as follows:

(a) If the defendants are allowed to market a product which is infringing there will be some loss of business to the claimant. At the end of the day, that loss could be quantified by seeing what business the defendants gained and working out what part of that business the claimant would have been able to obtain if the defendants had not been on the market. That would not necessarily be a difficult exercise.

(b) The damage to the reputation of the claimant has not been particularly clearly established. The claimant sought to adduce evidence of confusion on the part of some care home operators which it is said demonstrated that the inferior qualities of the defendants' products were attributed to the claimant's products. Those inferior qualities were those identified above. There was indeed some indication in the evidence that some of those things, to a limited extent, might have happened. However, that evidence was rather unsatisfactory. There was direct evidence from one particular care home owner who had formed a dim view of Biodose as a result of using Multimeds, but that seems to have been based on a misapprehension as to whose products she was using stemming from a lack of communication within the care home and from dealings with a pharmacy that had fallen out with the claimant. So far as the other evidence goes, it was based on some sort of informal telephone survey carried out by a representative of the claimant who rang various care homes and asked questions about Biodose complaints and some questions of a wholly uncertain nature about Multimeds. More recent contact with those care homes carried out by the defendants, sometimes speaking to different people, produced a somewhat different result. As Mr. Wilson frankly and sensibly conceded, this evidence was "a bit of a mess". The clear impression I have is that there is perhaps a little scope for confusion but I strongly suspect it is rather overstated. I do not think that ultimately the risks to the claimant under this head are that great and I certainly think that those risks would not be long-lasting were it to be the case that the defendants' product had to be taken off the market after a trial.

(c) I do, however, accept Mr. Wilson's submissions as to the sensitive time at which this is happening for the claimant, at least to a degree. I consider that the effects of the potential loss to it are magnified by the fact that it is about to reach breaking point in its trading. To postpone that for a newly started company could be very significant, although the consequences are probably overstated. I do not think that it is very compelling to suggest that the venture may collapse. I would have thought that the sums which have apparently been invested by shareholders (over £2m) are such that it is more likely than not that they will be patient if they thought a trial would bring success. This point is a valid one but only goes so far.

(d) So far as the defendants' losses are concerned, they would obviously suffer some whose extent it would not be easy to ascertain because one would not know how much business they would really have done had they been free to trade in the run-up to the trial. Furthermore, it is to be expected that Biodose would be exploited by the claimant so as to make it more difficult for the defendants to get back into the market with further difficulty in quantifying effects. All these consequences are financial and to that extent compensatable by damages but the difficulty in quantifying them makes damages a less than wholly satisfactory remedy.

(e) The critical factor in this calculation is the ability to pay damages. I am satisfied that the claimant could pay damages in an appropriate amount were it required to do so on any cross-undertaking. While, as I have indicated, it has failed to make a profit since it started trading in 2008 and its losses range from £261,000 to £660,000 in various years, it is probably about to break even and go into profit, and it has an ultimate net balance sheet solvency in the sum of about £900,000. Looking at the balance sheet, I consider that it will be good for any damages it would have to pay the defendants. On the other hand, as the defendants themselves accept, they are not good for any substantial damages that they might have to pay to the claimant at the end of the day. If this turns out to be an infringing product, in my view the damages would be classed as substantial. This, in my view, means that the balance of convenience would have favoured granting an injunction.

Result.

31. It follows that I find this application fails because the claimant has no good arguable case on infringement. Had I decided otherwise on that point, the claimant would have succeeded. As it is, however, the application for an injunction will be dismissed.

Annexe 1