Philip Price & Ors. v Flitcraft Limited & Ors.

Registration as proprietor of a patent is only prima facie evidence of ownership. Beneficial ownership may arise under a trust, while an assignment must satisfy the statutory formalities or be enforceable in equity. An undated assignment forming part of an incomplete commercial package may not take effect.

An exclusive licensee may bring infringement proceedings under the Patents Act 1977. Indirect infringement requires proof that supplied means are intended, or known or obviously suitable, to put the invention into effect. A threatened passing-off claim requires evidence of a real threat. Joint tortfeasorship depends on sufficiently close participation, direction, procurement or assistance pursuant to a common design.

The claimants alleged patent infringement, copyright infringement, passing off and joint tortfeasorship arising from the defendants’ timber-frame building products, intellectual property dealings and domain names.

The principal issues were whether the patents and copyrights were held on trust for a former partnership; whether later dealings assigned or transferred those rights; whether the second product constituted indirect patent infringement; whether the claimants owned enforceable copyright in photographs; whether the domain names justified quia timet relief; and whether Garry Flitcroft was jointly liable.

The trial concerned liability only. A prior order had already established Thomas Flitcroft’s potential joint liability if infringement by the relevant company were proved.

1. Title to the patents. The court rejected the alleged trust in favour of the MTF Partnership. Mere use of the invention, payment of renewal costs, use as security and absence of royalties did not establish an agreement or intention that the patents were partnership property. The patents were initially used under a licence from Mr Price and later under a sub-licence from Supawall.
2. The documents signed on 22 March 2011 did not assign the patents to Lightpeak. Objectively, the transaction remained conditional on missing elements, including the incorporation of SWL and the participation of intended parties in the shareholders’ agreements. The undated deed was not delivered, and was effectively held in escrow. The related termination agreement did not terminate Supawall’s exclusive licence because it was undated and expressly conditional on an assignment which never occurred.
3. The alleged assignment to Mr Bridge was not proved. Mr Price therefore remained proprietor when he became bankrupt, and the patents vested in his trustee in bankruptcy under sections 283, 306 and 436 of the Insolvency Act 1986. Mr Price consequently lacked title to sue under section 61 of the Patents Act 1977.
4. Supawall’s claim. The exclusive licence remained effective, and section 67 entitled Supawall to sue. FL infringed the 714 Patent through dealings with the Old Injectawall Product. The claim concerning the New Product failed: the evidence did not establish that customers intended, or that the defendants knew or ought obviously to have known, that the product would be adapted to put the invention into effect under section 60(2). The claim against FTFL also failed for lack of evidence of dealings.
5. The court’s preliminary view was that Supawall’s failure to join the proprietor under section 67(3) should not automatically lead to dismissal, but submissions were invited before a final order.
6. Copyright and passing off. Mr Price failed to prove title to the photographs because, without a grant of probate, he could not establish his mother’s title. Copyright in the drawing had vested in his trustee in bankruptcy. The passing-off claim failed because the domain names had not been used and no real threat of passing off was established.
7. Joint tortfeasorship and charge. Garry Flitcroft had sufficiently directed or participated in FL’s infringing dealings with the Old Product and was jointly liable with FL, alongside Thomas Flitcroft. The NWTIF Charge did not affect Supawall’s rights or damages under its earlier registered exclusive licence.

The judgment was a first-instance decision of the High Court (Patents Court). It records that an earlier summary judgment in favour of Mr Price had been set aside on appeal, but gives no citation for that appellate decision.