A threat to bring proceedings for infringement of a patent is actionable by a person aggrieved by the threats (under section 70 of the Patents Act 1977). This is true even if the threat is not communicated to the person threatened.
This principle was laid down in the nineteenth century by the case of Skinner & Co v Perry (1893) and has stood the test of time including various Patents Acts. It has now been reaffirmed by the Court of Appeal in the recent case of Sudarshan Chemical Industries Ltd v Clariant Produkte (Deutschland) GmbH [2013] EWCA Civ 919.
Whilst the principle could be seen to be a broad interpretation of an actionable threat, Lord Justice Moore-Bick, Lord Justice Kitchen and Lord Justice Floyd were all in agreement that an unjustified threat to sue a manufacturer's customers was actionable even when that threat had not been communicated directly to those customers.
Brief Details of the case
The dispute involved two rival organic pigment manufacturers, Clariant and Sudarshan, and in particular Clariant's patent for the process of making a greenish-yellow pigment marketed as 'H2GR', H2GR itself and certain mixtures containing H2GR. Clariant's patent was held invalid.
However, in 2009, a letter had been sent from Clariant to Sudarshan accusing Sudarshan of infringement and finished with the following statement:
'Certainly you will not be interested in continuously effecting a patent infringement, which may involve the most serious penalties to the infringer and his customers'.
Clariant argued strongly that this threat was not actionable because it was only made to Sudarshan who was a maker and importer, and therefore s70(4) of the Patents Act came to Clariant's rescue. However, the Court of Appeal did not accept this argument, particularly given that Clariant's patent was held to be invalid. The Court said the wording of the legislation on this point had been 'the subject of consistent judicial interpretation' since Skinner in 1893 and that 'parliament has had many opportunities to intervene but had chosen not to do so'. Clariant's letter was deemed to be an actionable threat against Sudarshan's customers.
This case is a useful reminder of the need to take extreme care when protecting patent rights in order stay on the right side of the law on threats.
The author, Richard Binns, is a litigator in Burges Salmon's Intellectual Property team which is led by Jeremy Dickerson.