AP Racing Ltd v Alcon Components Ltd

A later claim concerning articles omitted from earlier patent proceedings is not automatically an abuse merely because it could have been brought earlier. The court must make a broad, merits-based assessment of all the circumstances, with the burden on the defendant to establish abuse, oppression or unjust harassment. A patentee has no general duty to investigate every possible further infringement, although knowledge sufficient to put the patentee on inquiry may be relevant. In the IPEC, further allegations at an inquiry or account will ordinarily be admitted only in unusual circumstances where they require no additional evidence and can be determined quickly and proportionately. The court may consider what would have happened had the patentee sought to raise the allegations in the earlier inquiry.

AP Racing had brought an earlier patent infringement action concerning five caliper shapes. The patent was initially held invalid, but the Court of Appeal held it valid and ordered an inquiry as to damages or an account of profits. AP Racing later commenced a second action alleging infringement by seven other calipers that had been publicly available before the case management conference in the first action.

Alcon applied under CPR 3.4(2)(b) to strike out the second action as an abuse of process under the rule in Henderson v Henderson. The central issue was whether AP Racing’s failure to investigate and plead the alleged infringements earlier made the second action oppressive or otherwise abusive.

1. Alcon’s strike-out application was dismissed. The governing question was whether, considering all the circumstances, AP Racing’s conduct in bringing the second action amounted to an abuse of process or unjust oppression or harassment.

2. The court applied the broad, merits-based approach in Johnson v Gore Wood & Co. The fact that a matter could have been raised earlier did not make its later pursuit automatically abusive. The burden remained on Alcon.

3. There was no general duty requiring a claimant to exercise reasonable diligence before proceedings to discover every potential cause of action. Nevertheless, a claimant’s knowledge, the availability of information, the similarity between the claims and the time when relevant information became available could be relevant to the overall assessment. A reasonably diligent patentee could have investigated the seven calipers earlier, but that finding did not by itself establish abuse.

4. The court distinguished the considerations governing additional infringement allegations at an inquiry or account from those governing a fresh action. In the IPEC, civil-procedure reforms and the overriding objective meant that a patentee would ordinarily not be permitted to introduce further allegations requiring additional evidence. The court retained power under CPR 63.23(2), applied with the overriding objective, to consider further allegations in exceptional cases where they could be dealt with quickly, fairly and without additional evidence.

5. It was material to consider what would probably have happened had AP Racing raised the seven calipers in the inquiry. On the assumed facts, the issue could be resolved in about an hour without further evidence. AP Racing would probably have been entitled, as a matter of usual patent practice, to have the issue determined in the inquiry. Determining the issue in the second action therefore would not unjustly oppress or harass Alcon.

6. The court rejected the submission that the practice concerning inquiries and accounts created an identical test for abuse of process in fresh proceedings. The second action was nevertheless not abusive on the particular circumstances. The parties were directed to address the best procedural way forward.

The judgment was a first-instance decision. The judgment itself records that the Court of Appeal had previously allowed AP Racing’s appeal in the First Action and held the patent valid, but the citation of that decision is not stated.