The NOCO Company v Shenzhen Carku Technology Co Ltd

Under section 70(1) of the Patents Act 1977, the question is objective: whether a reasonable person in the recipient’s position would understand that a patent exists and that proceedings are intended against another person for infringement. The threatened person need not be the recipient. Written communications are assessed in context, including the sequence as a whole. A neutral online notification procedure does not prevent a threat where the complaint expressly alleges patent infringement and asks the marketplace to remove products. In that setting, the request may convey an implicit or veiled threat of court proceedings, particularly where the marketplace may be a secondary infringer. The appeal was dismissed.

The parties were rival manufacturers of lithium-ion vehicle jump-starting batteries. Carku brought proceedings concerning NOCO’s patent, including a claim for relief against unjustified threats. NOCO had submitted complaints through Amazon’s intellectual-property notification procedure, alleging patent infringement and asking Amazon to remove Carku products from sale. Amazon delisted products following the complaints.

Meade J held that the communications amounted to threats of infringement proceedings, although he also held the patent invalid for obviousness. The validity findings were not appealed: [2022] EWHC 2034 (Pat). NOCO appealed on the threat issue, arguing that Amazon’s procedure was an alternative dispute-resolution mechanism and that the complaints would not objectively be understood as threats against Amazon. The central issue was whether the complaints, viewed objectively and in context, conveyed an intention to bring infringement proceedings.

The appeal was dismissed unanimously. The Court of Appeal upheld the conclusion that NOCO’s complaints to Amazon contained threats of infringement proceedings.

1. Statutory test. Section 70(1) of the Patents Act 1977 establishes an objective test. The question is what a reasonable person in the position of the recipient would understand from the communication. The intended defendant need not be the recipient. Section 70A(1) also permits a claim by any person aggrieved by the threat, who need not be the recipient or the person against whom proceedings are threatened.
2. Meaning and interpretation. The concept of a threat is broad and includes veiled, covert, conditional and future threats. Written communications are interpreted using the principles applicable to contracts and unilateral documents, taking account of circumstances known at the date of communication. Actual understanding and response are not directly relevant. First impressions matter, and a sequence of communications should generally be considered as a whole: L’Oreal (UK) Ltd v Johnson & Johnson [2000] FSR 686; Best Buy Co Inc v Worldwide Sales Corporation Espaňa SL [2011] EWCA Civ 618; Brain v Ingledew Brown Bennison and Garrett (No 3) [1997] FSR 511.
3. Application to the complaints. An explicit allegation of patent infringement combined with a request to remove products from sale will, at least implicitly, convey that court proceedings may follow if the request is not obeyed. The request was made before any investigation of the allegations. It therefore went beyond neutral information capable of being a permitted communication.
4. Amazon’s procedure and context. Resort to an online notification or take-down procedure does not automatically amount to a threat. The content of the complaint and the surrounding circumstances must be assessed. The earlier VeRO observations in Quads 4 Kids v Campbell [2006] EWHC 2482 (Ch) were interlocutory or obiter and provided limited assistance. Amazon was potentially liable as a secondary infringer, retained rights and defences under its policy, could forward complaints to alleged infringers, and required an indemnity. The procedure was therefore not a genuinely neutral process that displaced the objective inference of a threat.
5. Conclusion. Even if the complaints were not understood as threats against Amazon itself, they clearly conveyed an intention to sue identifiable distributors if sales continued. The February 2020 email was unnecessary to the conclusion, although later communications could inform the interpretation of subsequent complaints. The appeal was dismissed.

• Court of Appeal (Civil Division): appeal dismissed on 19 December 2023.
• High Court of Justice, Intellectual Property List (ChD): Meade J held that the communications amounted to threats of patent infringement proceedings and held the patent invalid for obviousness: [2022] EWHC 2034 (Pat). The validity findings were not appealed.