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England and Wales High Court (Patents Court) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Patents Court) Decisions >> Coflexip Stena Offshore Limited, Coflexip S.A. [1999] EWHC Patents 258 (29th January, 1999) URL: http://www.bailii.org/ew/cases/EWHC/Patents/1999/258.html Cite as: [1999] EWHC Patents 258, [2001] RPC 182 |
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CH 1996 C. No. 4344
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
PATENTS COURT
Before: THE HON. MR. JUSTICE LADDIE
B E T W E E N
(1) COFLEXIP S.A.
(2) COFLEXIP STENA OFFSHORE LIMITED
Plaintiffs
- and -
(1) STOLT COMEX SEAWAY MS LIMITED
(2) STOLT COMEX SEAWAY LIMITED
(3) STOLT COMEX SEAWAY A/S
Defendants
Hearing date: 22 January, 1999
JUDGMENT
1. This is the official judgment of the court and I direct that no further note or transcript be made
DATED: 29 January, 1999
Mr. Justice Laddie:
Introduction
1. On 22 January, I gave judgment for the plaintiffs, Coflexip, in this patent action. In accordance with normal practice, a draft of my judgment was supplied to counsel and solicitors of the parties two days in advance and, based on that, I was provided with a draft order I would be invited to make after judgment. However before receiving that draft I had informally brought counsel's attention to the decision of Scott V-C in
2. The draft order produced by Mr. Miller on behalf of Coflexip asked, inter alia, for an injunction in the usual terms to restrain the defendants from infringing the patent in suit. At that stage Mr. Watson for the defendants, Stolt Comex, raised no objection to an injunction in that form. However I was not happy that such an injunction was justified and, after judgment was given, I raised my concerns with Mr. Miller. After hearing Mr. Miller at some length and Mr. Watson having addressed me very briefly to indicate that his clients did not consent to an injunction in wide and general terms, I indicated that I would only grant relief in a more restricted form, tied to the acts of infringement alleged and proved against Stolt Comex. An injunction in that form departs from normal practice in the Patents Court. Mr. Miller sought leave to appeal on this issue. Mr. Watson did not object. I agreed that it was important to have the views of the Court of Appeal on this matter and I granted leave. I told the parties that I would set out in writing my reasons for limiting the injunction. These are those reasons.
3. It hardly needs saying that the grant of an injunction is in the discretion of the court. However, as a practical matter, if a breach of the plaintiff's rights has been proved then it is unusual for the court to decline to grant such relief. This does not mean that the court's discretion is exhausted. It must tailor the injunction to match the wrong which has been committed and is threatened. In patent cases, it has been normal to grant a successful plaintiff an injunction expressed in terms of the right found to be infringed. So the usual form of relief includes an injunction "to restrain the defendant from infringing" the patent in suit. Such orders are made regularly and, to the best of my recollection, without any discussion as to whether they are appropriate. It seems to me that it is time to consider whether injunctions in that form should be given as of course or whether a more limited form of relief may be appropriate in some cases.
4. The issue arises particularly clearly in this case. I have found the patent in suit valid. The injunction sought by Mr. Miller would restrain any infringement. But should an injunction be granted in that form or should it be limited to restraining Stolt Comex from carrying on the one type of activity which has been pleaded as infringing and which they have threatened to continue?
5. In finding for Coflexip, I have held that a major feature of the main claims is that substantially all of the tension exerted by the weight of pipe hanging below a marine pipe-laying vessel should be taken by a vertical array of tensioning devices on the vessel. This stops the pipe falling over the side of the vessel. Another important feature of the claims is that the flexible pipe to be laid by the vessel should be delivered into the sea down a substantially vertical ramp. Stolt Comex's pipe-laying ship, the Seaway Falcon, employs an arrangement in which virtually all the tension is taken vertically and there is a vertical ramp for laying the pipe. It may be that Stolt Comex will consider that a worthwhile modification to make to the Seaway Falcon is to take more of the tension horizontally. For example it is possible that they may decide to take 30% or 60% of the tension that way. Furthermore it is possible that they may decide to alter the angle of the ramp. For example they may decide to alter it so that it is at 150 to the vertical. If an injunction is limited to the current configuration of that vessel, any such modifications would not fall within it. If an injunction in the standard form is granted, it will be open to dispute whether it does or not.
Grounds for preferring a narrower form of injunction
6. It seems to me that whenever a court at the end of a trial grants permanent injunctive relief, the purpose should be to give effect to its judgment on liability. It has made certain findings of fact and applied to them its understanding of the law. Subject to questions of appeal, those findings bind the parties. The injunction granted should protect the plaintiff from a continuation of the infringements of his rights by the threatened activities of the defendant. But the injunction must also be fair to the defendant. Although an injunction in wide standard form could meet the first of these requirements, I do not think it meets the second. There are a number of reasons for coming to this conclusion.
(i) Is there a threat?
7. Damages or an account of profits look to the past and are designed to compensate the plaintiff for the harm inflicted on him or to deprive the defendant of the benefit obtained by the activities performed in breach of the plaintiff's rights. The injunction looks to the future. Its purpose is to restrain threatened breaches of the plaintiff's rights. Normally, when a defendant has infringed, the court will assume it is not a one-off activity and will grant an injunction to stop repetition. This course is not inevitable. In a few cases courts have concluded that even though infringement has occurred, no future threat exists. In such cases, injunctive relief has been refused. Thus in Proctor v. Bailey and Son (1889) 6 RPC 538, the defendant had infringed a patent some six years before the trial of the action and that activity had lasted a very short time. The Vice Chancellor of the Duchy of Lancaster had granted and injunction. The Court of Appeal overturned that decision. Cotton LJ said:
"There is no doubt that it was a good patent, and we must also take it that the Defendants have infringed; but the point is this: Is there any ground here which would justify the Court in exercising the extraordinary jurisdiction of the Court of Chancery in granting an injunction ? That, I think, has been a good deal lost sight of in the argument. It is not because a man has done a wrong that an injunction will be granted against him. If a man has done a wrong which will not be continued, at common law damages may be obtained for the wrong done, which the common law says is sufficient indemnity for that wrong; but then the Court of Chancery says this in the exercise of its extraordinary jurisdiction :- ‘We will not be satisfied with that; we will grant an injunction because a wrongful act has been done in order to prevent that wrongful act;' and they grant an injunction where a wrongful act has been done and the Court is satisfied of the probability of the continuance of the wrongful act. Its practice is preventive, and not like the Common Law Courts, which merely give damages against the wrongdoer for the wrongful act which he has done, and now that all the Superior Courts exercise all jurisdictions a great deal is lost sight of as to what was the jurisdiction of the Court of Chancery, and what was the jurisdiction of a Court of Common Law. In this particular case it becomes necessary for us to look at the matter carefully to see whether the order for this injunction can be sustained or not, and that is the first point which I shall deal with. Undoubtedly wherever a person has done a wrongful act in infringing a patent prima facie that is ground for granting an injunction, because when a man has done a wrongful act the probability (unless there is anything which prevents that probability from arising) is that he will continue it, and the Patentee who is injured by that act is entitled, in a Court of Equity, to prevent a repetition of that wrongful act. The Patentee would be entitled to the protection of the Court of Chancery from what was done by the Defendant, although there had been no infringement, if there was what the Court would consider an intention to commit that infringement; but here, although the Defendants did infringe the Plaintiff's patent, we must consider all the circumstances of the case in order to guide us in the consideration of this: - Ought the Court to draw the inference that there will be a continuance of the wrongful act so as to justify the court in granting the extraordinary interference and the protection which is exercised by a Court of Equity." (p.541)
and Fry LJ said:
"... the question is, whether an injunction ought to have been granted. An injunction, be it borne in mind, is granted under a preventative jurisdiction of this Court, is addressed to the prevention of an injury, which is about to be done or which the Court sees the probability of being done, and is not rightly described as protective. To prevent a wrong protects a right, but in no other sense than that can it be properly described as a protective jurisdiction." (545)
8. In at least one patent case, Raleigh v. Miller (1949) 66 RPC 23 at 43, an injunction was refused where there had been only one act of infringement and the judge thought that the defendant did not intend to infringe anybody's rights. Instead leave was granted to apply for an injunction if there was any threat to infringe in the future. A similar course has been adopted in trade mark and passing off cases: Treasure Cot Co. Ltd. v. Hamley Bros. Ltd. (1950) 67 RPC 89 and Wayne V. Myers Co. Ltd. v. L.E. Fields Auto Services Ltd. (1954) 71 RPC 435. In the last few days, Park J. has also refused to grant injunctive relief to a plaintiff who had succeeded, at least in part, in a design right infringement action. In Frayling Furniture v. Premier Upholstery Ltd the infringement had occurred some five years before the trial and had not been repeated. In a supplemental judgment given on 21 January, Park J. said:
"[Counsel for the plaintiff] asked for an injunction restraining Premier from committing further infringements of Frayling's design right in the Sienna. However, as I said in my main judgment, Premier has stopped making the Reno and I do not think that there is any real chance of it wanting to start again. The infringements which it committed in the past were entirely inadvertent: Premier is not the sort of company which, given half a chance, will try to infringe a competitor's design right and hope to get away with it. An injunction is a discretionary remedy, and I am not prepared to exercise my discretion to grant one in the present case. Nor do I see any point in giving Frayling liberty to apply for an injunction in future. If it considers at some future time that Premier has started infringing its design rights again, it can apply for an injunction then, and does not need me now to give it liberty to apply to do so."
9. This ties in with the approach taken to quia timet relief. The necessity of showing the existence of a threat was referred to in a colourful passage during the argument in K.S. Paul (Printing Machinery) Ltd v. Southern Instruments (Communications) Ltd. [1964] RPC 118 at 122:
"Harman L.J. - ... You cannot get an injunction against a man unless you can say he is threatening and intending to do this and unless restrained by injunction will do it? ... It is exactly as if Mr. Aldous in a sworn affidavit had said: ‘I am fearful that unless restrained by the Court Sir Lionel Heald will hit me on the head with a volume of the Patent Reports'. He then goes on and says: ‘If he is not going to do it, it will not hurt him, so you may as well grant an injunction.' I have heard that argument before."
10. The same point was made by Lord Dunedin in A.G. for Canada v. Ritchie Contracting Supply Co. [1919] AC 999:
"... no one can obtain a quia timet order by merely saying "Timeo"; he must aver and prove that what is going on is calculated to infringe his rights." (p. 1005)
11. In a patent action the plaintiff normally alleges that the defendant has committed one or two specific types of infringement. They have to be identified in the plaintiff's pleadings. In virtually all cases, the infringement will occupy just a small part of the monopoly secured by the patent and its claims. Further, in almost all cases, it is only the activities identified in the particulars of infringement which the defendant threatens to continue. He has not threatened to commit any other acts. The effect of a broad injunction would be to restrain the defendant from doing things he has not threatened to do, may never have thought of doing and may be incapable of doing.
12. The court has not considered, let alone determined, whether and what other activities infringe. This point can arise in any intellectual property right litigation but it is particularly significant in patent litigation. It sometimes happens either shortly before or during the course of a trial that the patentee finds another, different, activity of the defendant which he wants to add to the particulars of infringement. Because the issue of infringement may raise new questions of fact and involve expert evidence, it is common for the courts to decline leave to amend the pleadings if that course is likely to prejudice the trial date. The plaintiff will have to start separate proceedings if, notwithstanding his success in the first action, the defendant insists on maintaining his right to continue with the second activity. There is nothing abusive in the defendant deciding to take that position. Even assuming it is not open to him to challenge again the validity of the patent (an issue which does not arise here for consideration), it is legitimate for him to argue non-infringement. In relation to that, no question of issue estoppel or res judicata arises.
13. Similarly, from time to time a defendant believes he has found a way round the patent and wants the court to rule on his new device or process. The court almost always refuses to allow the modification to be considered at the trial unless the defendant has complied with the provisions of s. 72 of the Patents Act, 1977 relating to declarations of non-infringement. Again, if the attempt to add the new issue is made at or shortly before the trial and puts the trial date at risk, the court is likely to refuse to allow it in, requiring the defendant instead to bring separate declaratory proceedings.
14. Inherent in these types of cases is the recognition that in any infringement action the court is not embarking on a consideration of all possible products and processes which might fall within the patent monopoly, but only those which have been identified in the pleadings. An injunction in general terms restraining the defendant from infringing the patent therefore covers more than the defendant has threatened to do or the court has considered.
15. This is not a merely theoretical objection. The scope of protection can be one of the most difficult issues in patent litigation. It must be determined in accordance with the provisions of section 60 of the Act and the Protocol on Interpretation. A purely linguistic approach to the claims will not do as was pointed out by the House of Lords in Catnic v. Hill & Smith [1982] RPC 183. A purposive construction has to be adopted. What that means was explained by Hoffmann LJ, as he then was, in Improver Corporation v. Remington Consumer Products Limited [1990] FSR 181. The result is that, particularly at the edges of a patent claim, the question of infringement can raise fine points of technology and require the assistance of expert evidence. Mr. Watson argued that deciding the issue of infringement under the 1977 Act is even more difficult than it was under previous legislation. However, whether that is so or not is not the important factor. Whatever the position was under the pre-EPC law, the scope of protection obtained by a valid patent can now be difficult to determine.
(ii) Clarity
16. A defendant who has been enjoined must know what he can and cannot do. He should not be set a puzzle. As noted above, in most cases the precise outer limits of a patent claim are far from clear. This is confirmed, if any confirmation is necessary, by the numerous cases in which the finding on infringement arrived at by the High Court is reversed in the appellate courts. A good example of this is Catnic. There the finding of infringement in the High Court was overturned by a majority of the Court of Appeal and, in turn, unanimously restored by the House of Lords. An injunction not to infringe a patent incorporates all this imprecision.
17. The reluctance of the courts to grant imprecise injunctions has been commented on particularly in two areas; breach of confidence actions and where mandatory injunctions are in issue. In relation to breach of confidence, for example in Potters-Ballotini Ltd. v. Weston-Baker [1977] R.P.C. 202, Denning M.R. said:
"It is well established that an injunction ought to be such that the party affected can know with certainty what he is or is not allowed to do." (p.206).
2. While in relation to mandatory judgments, in Morris v. Redland Bricks Ltd. [1970] AC 652, Lord Upjohn said:
"If in the exercise of its discretion the court decides that it is a proper case to grant a mandatory injunction, then the court must be careful to see that the defendant knows exactly in fact what he has to do and this means not as a matter of law but as a matter of fact ... the court must in fairness to the defendant tell him what he has to do ..." (p666)
18. The first of these cases was at the interlocutory stage and, in any event, only was concerned with confidential information. In such cases the scope of the plaintiff's rights are notoriously hard to define. But that is a matter of degree only. To the extent that an injunction granted to restrain infringement of patent is obscure, the same criticism applies. Furthermore the fact that Potters-Ballotini was a judgment given at the interlocutory stage does not undermine its relevance. The objection at that stage is that the court had not determined whether the plaintiff has any rights or whether the specific acts of the defendant infringes them. So when an interlocutory injunction is granted it should be expressed in terms which make it clear what the defendant can or cannot do, without reference to rights which have not been established at that stage. Of course, once the validity of the rights and the fact of infringement has been proved at the trial, this objection disappears in relation to the particular acts of infringement which the court has ruled upon. But in relation to possible acts of infringement which have never been threatened by the defendant nor considered by the court, the same objection applies and for the same reason.
19. Similarly, the underlying principle in Morris v. Redland Bricks Ltd appears to me to have application outside the area of mandatory injunctions. As Lord Upjohn pointed out (at p. 667 A) where the mandatory injunction is very easy to understand and needs no further elucidation, there is no objection on this ground to granting it. The same applies to many negative injunctions. But where the injunction asked for is obscure in extent, then it does not matter whether it is mandatory or negative, the court should either not grant it at all or, where possible, express it in terms which meet the precise needs of the plaintiff.
(iii) Contempt
20. The question of clarity is tied to the issue of enforcement. What happens if the defendant wishes to operate a new process or make a new product which, though different to the ones the subject of the original proceedings are still arguably within the scope of the patent? If he adopts the new process or product he is at risk not only of damages or an account but of being held in contempt of court. If he uses again the same process or makes the same products as were the subject of the original proceedings, the issue of infringement has been determined against him and, subject to appeal, is res judicata. But this is not so in relation to the new process or product which is different to the one dealt with in the proceedings. If he goes ahead and adopts the new process or product, he runs the risk of sequestration, fines or, in the case of personal defendants, imprisonment. Furthermore in any contempt proceedings the issue of whether there has been infringement will have to be determined. This is most unsatisfactory. For example in Electronic Applications (Commercial) Ltd. v. Toubkin and Anor [1962] R.P.C. 225, Wilberforce J said:
"I would add this, that if I were to grant an injunction in the terms of paragraph 1 of the notice of motion I think embarrassing consequences might easily follow. It is not clear from the plaintiffs' evidence what exactly the confidential information does consist of, and it seems to me that to grant an injunction referring generally to confidential information would inevitably lead to embarrassing and difficult questions on an application to commit the defendant and seeking to restrain the defendant company. For that reason also I think it inappropriate on the material which I have to grant the injunction asked for ..."
21. Once again, this was a case of an interlocutory injunction, but the embarrassment would arise because on the committal, the existence of the plaintiff's rights and their infringement would have to be resolved. This is because on committal the court would be asked to rule on the breach of the injunction by actions of the defendant in respect of which there was no existing and binding finding of the court that there had been a breach at all. I can see no difference in principle when one is considering those areas of a general injunction which prevent a defendant from doing something he has not threatened to do and which the court has not considered, let alone ruled on. Very similar objections to those raised in Electronic Applications (Commercial) Ltd. have been mentioned in a number of cases including The Staver Co. Inc. v Digitext Display Ltd. [1985] FSR 512, P.A. Thomas v. Mould [1968] 2 Q.B. 913, Berkeley Hotel Co. Ltd. v. Berkeley International (Mayfair) Ltd. [1972] RPC 237 at p. 239 line 36, Liverpool Household Stores Association v. Smith (1888) 37 Ch. D. 170 and Potters-Ballotini.
22.
The problems which can flow from granting an injunction in broad terms and then allowing what is essentially a new action for infringement to be tried in the course of contempt proceedings can be seen by following the bizarre progress of the proceedings in Multiform Displays Ltd. v. Whitmarley Displays Ltd. (1955) RPC 256 (High Court), 321 (Court of Appeal), 358 (High Court), [1957] RPC 137 (High Court), 260 (House of Lords), 401 (High Court). In the House of Lords, Viscount Simonds understated the position:"Thus it is, my Lords, that upon what was a motion for sequestration and committal your Lordships are asked to try an action for infringement of a patent, and, inconvenient though such a procedure may be, it cannot be denied that there is ample precedent for it, nor that in certain cases it may be an expeditious way in which patentees can enforce their established rights. It may, nevertheless, well be doubted whether in the present case it would not have been a better course if advantage had been taken of the facilities offered by Sec. 66 of the Patents Act, 1949, to have the issue of infringement tried in proceedings unattended by threats of committal and sequestration." (p. 262)
23. It does not appear from the report that counsel for the defendant argued that an injunction in general form to restrain infringement of the plaintiff's patent should not have been granted. By the time the committal motion came on for hearing any such argument would have been futile anyway. The injunction had been granted by consent.
Arguments advanced by Coflexip
24. Mr. Miller argued that in the patent field the general form of injunction was the standard form and had been for a very long time indeed. The practice should not be overturned lightly. Further he said that the practice made sense in that it gave the plaintiff real protection. To these can be added the argument that such orders have done no harm in the past. I will consider each of these in turn.
Long established practice
25. This is clearly a major point, particularly if the grant has caused and is likely to cause no difficulty in practice. Injunctions in broad general terms have been granted by judges of the greatest eminence over the years. It clearly would be wrong to change a settled practice on a whim. In the area of equitable relief, as in all others, judges are meant to apply uniform standards and uniform principles. It would be unacceptable if it became impossible for parties to make a reasonably accurate prediction as to the form relief will take if infringement of the plaintiff's right is established. Parties need to be able to plan ahead even before judgment is given. But although injunctions have been granted in wide terms in patent actions in the past it appears that their terms have seldom if ever been the subject of detailed consideration. As Mr. Christopher Wadlow put it in his book, The Law of Passing Off (First Edn. 1990 - Sweet & Maxwell p. 465 footnote 34):
"In practice it is rare for the precise terms of the injunction to be of much interest to either party or to the court."
3. I am sure that the same point can be made in relation to patent injunctions. In any event, the fact that broad injunctions have been granted in the past does not mean it is impermissible to look afresh at the basic principles. If such a reassessment suggests that the standard form relief in the circumstances of a particular case is inappropriate, it would be wrong to grant it, no matter what its pedigree. Although Mr. Miller agreed that in some patent cases the standard form of injunction might not be suitable, that concession did not apply to this case.
Broad injunctions do no harm
26. A defendant who has been held to infringe a valid patent but wants to stay, without further infringing the patentee's rights, in the same line of business using a similar but non-infringing product or process is presented with two choices, assuming that he does not take the path of least resistance and just give up. If he is advised by his lawyers that his new product or process is non-infringing, he can just re-enter the market. However he does so at considerable risk. If his lawyers' assessment is wrong he will still be in contempt. The error of judgment in the legal advice he received goes only to mitigation: see Re the Mileage Conference Group of the Tyre Manufacturers' Conference Ltd's Agreement [1966] 1 WLR 1137 and, more generally, A.G. v. Times Newspapers Ltd. [1992] 1 AC 191 at 217-8 per Lord Oliver. In fact he would be in contempt even if the original injunction in force at the time of his new venture is discharged on appeal: see Wardle Fabrics v. Myristis Ltd. [1984] FSR 263, followed by Scott J. as he then was, in Columbia Pictures Inc. v. Robinson [1987] 1 Ch. 38. See also Multiform Displays Ltd. v. Whitmarley Displays Ltd. [1957] RPC 401. The risk of being held in contempt and the adverse publicity likely to be generated by being accused of being in contempt will put all but the most determined off taking this course.
27. The obvious alternative is to hold back and go to court to ask for confirmation that the new venture does not breach the injunction. The first stage would be to ask the plaintiff for confirmation that the new process or product does not infringe. In my experience that has always proved a futile inquiry. Either the plaintiff answers by saying that the product or process infringes or it simply refuses to state its position. The defendant must therefore go to court to ask for clarification of his position. After all, why should the plaintiff ease the path for his competitor. That course was sanctioned by Scott V-C in The Staver Co case. It was a course which was taken by the defendant in Filhol v. Fairfax [1990] RPC 79. There a defendant who had lost an action concerning the design of dental pins used to create foundations for false teeth wanted to get onto the market with a product which was designed so as to avoid the construction of the patent claims found by both the High Court and the Court of Appeal. The patentee refused to acknowledge that the new product was outside the patent claims and the injunction granted and proceedings had to be brought for a declaration of non-infringement. Those proceedings were successful. I understand that a second non-infringing product was subsequently designed by the defendant. Once again the patentee refused to acknowledge non-infringement. Further proceedings had to be commenced although at that stage the patentee relented. Adopting this course is likely to mean that the defendant is kept off the market for a period of months or possibly years while the issue of whether he will be in contempt is decided. During that time he is not protected by any cross undertaking in damages. Both he and the public are the losers.
28. The position of the defendant in this type of case has to be compared with the position of all his competitors. If they have a device or process which they are advised does not infringe the patentee's monopoly, they can enter the market. The risk they run is only that they may lose any proceedings which are brought and may have to compensate the patentee and submit to an injunction. Mr. Miller accepted that the defendant is in a worse position, but he said that that was only fair. After all the defendant had lost one patent infringement action already. Tears should not be shed for him. This is really a version of, "once a thief always a thief" or "one strike and he is out". I cannot accept that a defendant who has failed in a patent action should be treated this way simply because he has lost. He is not a social outcast, to be treated differently to the rest of the world.
29. The practical effect of a broad injunction and the threat of contempt proceedings is that most defendants will steer well clear of the patent. The result is that at least in respect of that defendant the patentee secures a wider monopoly than this patent should entitle him to.
Plaintiffs need and deserve proper protection.
30. The most important part of Mr. Miller's submission, and the one that he returned to a number of times, was that a successful patentee in a patent infringement action could not be adequately protected without an injunction in general terms and that if I refused to make an order in such terms I would be depriving his clients of their victory. In support of this he reminded me of, but did not take me to, Spectravest Inc v Aperknit Ltd [1988] FSR 161 in which Millett J, as he then was, said:
"The ingenuity of those who infringe copyright and trade marks and engage in passing off is boundless, and plaintiffs cannot be adequately protected by orders which are cabined or confined. That is the reason for the standard forms of injunctions in such cases, with their inevitable references to ‘otherwise infringing', ‘substantial part', ‘to like effect', ‘colourable imitation', ‘otherwise passing off'. Where a defendant, faced with such an order, acts honestly and reasonably, this will mitigate and even excuse a breach of the order; but if a breach is proved, it will be for him to mitigate or justify it, and his excuse may need to be thoroughly probed if the circumstances are suspicious." (p. 174-5)
31. Mr. Miller no doubt relies on the reference to "inevitable" and the general suggestion behind this passage that most of those who infringe copyright or trade marks and engage in passing off are recidivists who will try to find alternative ways of infringing the proprietor's rights. What Mr. Miller was suggesting was that the same view should be taken of patent infringers in general. However, what was very noticeable about Mr. Miller's submission was that he did not suggest that Stolt Comex was dishonourable. Any such suggestion would have been impossible to advance. There is nothing to suggest that when the defendants performed the acts of which complaint has been made in this action they had any belief that what they were doing infringed any valid rights held by Coflexip. Mr. Miller never suggested, nor could he, that the arguments of non-infringement advanced by the defendant were fanciful. He certainly could not have suggested that the arguments against validity were thin. They were powerful and so treated by Mr. Miller during the course of the trial. The open enthusiasm with which Mr. Watson looked forward to the appeal was apparent. Clearly the defendants regard my judgment as a temporary setback before their inevitable victory in a higher court.
32. So, if no such allegation of threatened or likely recidivism can be levelled at the defendant personally, Mr. Miller relies on the Spectravest approach. Patent infringers as a group are to be expected to try to find colourable or devious ways of infringing a patent, even if they have already lost a patent infringement action. I reject this approach to the grant of injunctive relief. I respectfully agree with Millett J. that there are certain copyright or trade mark infringers and some traders who engage in passing off who have shown themselves to be untrustworthy. Some of those who engage in the illicit manufacture, importation or sale of counterfeit goods including unlicensed copies of films, sound recordings, software and the like may well have commenced business in the knowledge that they were flagrantly infringing the relevant plaintiffs' rights. In most such cases the defendants also know of the well-advertised campaigns undertaken to discover their activities and have taken pre-emptive steps to hide their activities. I would respectfully agree with Millett J. that in such cases the plaintiffs may not be adequately protected by orders which are cabined or confined. Wider injunctions may be the only reasonable way of giving the plaintiffs the protection they need. The wide-ranging orders obtained by copyright collecting societies are examples of that.
33. But to go from that to the general proposition that all infringers of intellectual property rights are to be treated as devious and that plaintiffs need much wider orders in intellectual property cases to protect them against future ingenious, but yet unthought of, acts of infringement is unjustified. It comes close to asserting class guilt. Most losing defendants, even in passing off and copyright claims, are perfectly respectable and honest traders. Few businessmen are interested in knowingly infringing valid intellectual property rights. See, for example, Park J's comments in Frayling Furniture set out in paragraph 8 above. If I consider patents alone, in 30 years experience of litigation in this area, I have never come across a defendant who engaged in infringement knowing that what he was doing was wrong. They all thought that they either did not infringe or the patent was invalid or both. Most of those who lose think that they have been unlucky or worse. I never came across a defendant who, having lost, expressed any desire to take the risk of infringing again. The costs of patent litigation are too high. There is, I think, only one reported case of such an infringer. In any event, Mr. Miller's whole approach is wrong. When the court is asked to grant an injunction in a patent action, it is not considering the actions of an anonymous member of a uniform class of infringers. It has to consider the facts of the particular case and the behaviour, both past and threatened, of the particular defendant. As Cotton LJ said in Proctor v. Bailey, it is necessary to consider all the circumstances of the case before deciding what is the correct injunction to grant. It cannot be right to simply treat all patent infringers as bad apples.
34. It will be understood from what is set out above that I do not accept that the plaintiff is not adequately protected by a narrow form injunction. On the other hand steps should be taken to avoid incurring unnecessary costs and wasting court time if the defendant decides to embark on a Mark II venture. Although it is not right that the priority treatment given to contempt motions should be used to furnish quick decisions on new infringements, it would be wasteful if the plaintiff had to commence infringement proceedings de novo. It appears to me that where a narrow injunction is granted it may be appropriate for the order to include an express liberty to apply so that possible new infringements can be determined in the same proceedings against the background of the expert and factual evidence already given in relation to the first infringement. If the Mark II is a modification which meets the letter of the existing injunction but not the spirit of the judgment, the defendant's ploy will be short lived. I would expect the plaintiff to seek and obtain interlocutory relief. It is to be expected that since only infringement is in issue the hearing under the liberty to apply would be short and could come on rapidly. If it is obvious that the modification is an infringement, not only will the Mark II be enjoined but the court might then think that the Spectravest approach is appropriate and will grant a wider form of relief. In addition to this the court may order costs to be paid on the higher scale and may also be sympathetic to an application for an order for lump sum costs under the provisions of Order 62 R. 7(4)(b). In order to facilitate any such renewed application to the court, I am prepared to put an express liberty to apply into the Order to be made in this case so that Coflexip does not need to issue a new writ.
Australia
35. The considerations which I have set out above have also been the subject of considerable discussion in Australia. For the purpose of this judgment I will only refer to a few of the reported cases. In Schindler Lifts v. Deblak (1989) 15 IPR 129, Pincus J in the Federal Court of Australia was considering wide-ranging allegations of defamation, inducing breach of contract and misleading or deceptive representations contrary to the Trade Practices Act 1974. Although he found for the plaintiff, he declined injunctive relief. Amongst other things he said:
"(I)t is in general undesirable, in my opinion, so to frame an injunction that it does little more than repeat the respondents' general legal obligations, substituting for the ordinary remedies for breach of them the possibility of the drastic remedy of imprisonment. Further, it is in general undesirable so to frame an injunction that the question whether a breach has occurred is likely to be very debatable until settled by an order made in contempt proceedings." (p. 172)
4. Pincus J. also expressed similar views in Trade Practices Commission v Walplan Pty Ltd (1985) 7 ATPR 47
36. In Trade Practices Commission v. Glo Juice Co. Pty. Ltd. (1987) 9 IPR 63, a decision of Burchett J. in the Federal Court of Australia, the only issue before the judge was the form of injunction to be granted against a party found to have breached the Trade Practices Act, 1974, a statute in Australia which prohibits misleading or deceptive commercial conduct. This issue was the subject of argument over seven days. The whole judgment rewards reading. For present purposes it is sufficient to quote a few passages from it.
37. Having cited the following paragraph from the judgment of Bowen CJ in World Series Cricket Pty Ltd v Parish (1977) 16 ALR 181:
"It should be mentioned, however, that one of the orders made restrained conduct that was misleading or deceptive and another two restrained the use of certain expressions ‘in such a way as to be misleading or deceptive' or ‘in such a way as to mislead or deceive'. In my view, it is often undesirable to frame interlocutory orders in such a way as to raise the very issues that will fall to be decided at the hearing. If the conduct is again called in question, it will usually not be possible to determine, on a contempt application, whether or not the interlocutory order has been infringed (Australian Consolidated Press Ltd v Morgan (1965) 112 CLR 483; (1966) ALR 387). By leaving that question to the final hearing, there will be a failure to meet the need for urgent relief, and the party enjoined will, on the final hearing, be put at risk not only of a final injunction but also of being in contempt. That is not a purpose which an interlocutory order is meant to serve." (p. 191-2)
"This passage is concerned with interlocutory orders, but it expresses a principle that is equally applicable to the framing of a final order in such a way as to raise an issue not decided at the final hearing, and which will fall to be decided at the hearing of a contempt application in the event that circumstances coming within the terms of the order do occur, so as to put the respondent at risk not only of an injunction in respect of the occurring of these circumstances but also of being then in contempt. That is not a purpose which an interlocutory order is meant to serve; it is not a purpose a final order is meant to serve either." (p. 71)
6. He then quoted with approval the following passage from the unreported judgment of Woodward J. in Australian Transport Insurance Pty Ltd v Graeme Phillips Road Transport Insurances Pty Ltd:
"It is essential that the terms of any permanent injunction are expressed as precisely as possible. It has been said in relation to mandatory injunctions that ‘the court must be careful to see that the defendant knows exactly in fact what he has to do and this means not as a matter of law but as a matter of fact' (per Lord Upjohn in
Redland Bricks Ltd v Morris [1970] AC 652 at 666). Whilst that reminder is particularly apt in the case of mandatory injunctions, it is I think generally applicable to the granting of all injunctions, in view of the substantial penalties which may follow any breach."38. Burchett J. then commented:
"(I)t was said the applicant would not prosecute unreasonably in the event of unavoidable breach of an injunction, and that, if it did, the respondent could put the facts excusing it before the court. Counsel asserted the court would be excusing a breach of the law in advance if it did not issue an injunction in the form sought. Counsel seemed almost to suggest that to refrain from granting this remedy would be to offer the respondent something in the nature of an indulgence.
I think there is more polemic than reason to such an approach. The court does not impose the heavy obligation of an injunction upon a party with the intention that it may be breached with impunity, whether because of leniency or the exercise of reasonable discretion, by the applicant or by the Court. An order is intended to be obeyed, and there is no such defence to proceedings for contempt as reasonable conduct: McNair Anderson Associates Pty Ltd v Hinch [1985] VR 309. Nor would the failure of an injunction to issue afford any defence, in a case actually involving a breach of the law, to independent proceedings in respect of that breach. Where the postulated breach would be different in kind from any breach which led to the injunction proceedings, it may be most appropriate that it be established in independent proceedings".
7. And, in refusing to grant a wide injunction and granting one which was tailored to meet the type of breach of the statute which had been proved, the judge commented:
"In an appropriate case, the court should not be deterred by a respondent's difficulties of compliance with a proper order. But to make the injunction sought would be to train the heavy guns of the law upon the respondent. Having regard to all of the circumstances, I do not think that would be the right way in which to exercise my discretion in this case. The appropriate injunction is one designed to protect the public against the sort of breach which has been shown to have occurred on a limited number of occasions in the course of large-scale operations, without at the same time exposing the respondent to the risk of finding itself in contempt of court because of a different problem altogether"
39. It seems to me that the approach set out in these cases is correct and as applicable here as in Australia.
Germany
40. Finally I should mention that the grant of a limited injunctive relief in patent actions is something which is taken for granted by our colleagues in Germany. I understand that for a very long time indeed the German patent courts have worded their injunctions in terms of the act of infringement proved. They have taken the view that a new infringement should be assessed in infringement proceedings and not in proceedings for contempt. A number of decisions illustrate the thinking behind this approach. For example in a judgment of the Reichsgericht of 1935 (RGZ 147, 27), the court said that "the wording of the injunction has to follow the infringing action" and it explained that this was so because "in cases in which the defendant does not claim that he was entitled to make use of the patent, a wording of the injunction not related to the infringing action would make no sense". Similar views can be found in RGZ (1929) 125, 391 and GRUR (1936) 905.
Conclusion
41. I am of the view that it would not be appropriate in the circumstances of this case to grant an injunction simply to restrain infringement of Coflexip's patent. It appears to me that if, as Cotton LJ said in Proctor v. Bailey, the purpose of an injunction "where a wrongful act has been done" is to prevent "a repetition of that wrongful act", prima facie it is not appropriate to grant an injunction against some other act, particularly one which has not been threatened, let alone determined to be wrongful. All of the possible modifications referred to in paragraph 5 above were ones put forward to illustrate the argument. There is nothing to suggest that any of them will be adopted by Stolt Comex. At the moment there is nothing to suggest that they will make or use any apparatus which could arguably be said to fall within the scope of Coflexip's patent. The injunction in this case should be limited to the acts of infringement proved.
42. I have dealt at length with what is really a quite short point. But behind Mr. Miller's argument was the suggestion that to grant a limited injunction in this case would be a heretical abandonment of more than a century of good practice. I have thought it necessary to demonstrate that limited injunctions have been granted before and to set out the principles which I have taken into consideration in deciding the precise form of injunctive relief which would be appropriate in the circumstances of this case.
