Phil & Ted’s Most Excellent Buggy Company Ltd
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Phil & Ted’s Most Excellent Buggy Company Ltd
Don’t be confused. This is not an exciting adventure but an important reminder to potential IP litigants and their advisers as to the dangers of making (in this case) patent threats. The ramifications of making patent threats (or any threat of a registered IP right – trade mark, registered design) hangs over us all when penning those all important cease and desist letters (now known as pre-action letters). If the letter saying “these are our registered rights, you are infringing and if you don’t stop we will sue you” can be taken as a threat made without any genuine or serious intent, then the recipient of such letter can sue the rights owner (and their legal representative) for threats.
TFK Trends for Kids GmbH alleged infringement of their patent relating to a buggy module, convertible between seat and cot configurations against Phil & Ted’s Most Excellent Buggy Company Ltd (the Company). The Company took exception by bringing an action for unjustified threats, also seeking revocation of TFK’s patent for lack of inventive step in view of Chinese Utility Model CN2739058Y (Goodbaby). Both the trial judge and the court of appeal found in favour of the Company due to the prior Goodbaby Chinese Utility Model. Although international patents (and utility models) are routinely searched and cited as novelty-busting prior art, the sheer volume of Chinese patent and utility models, their often dubious translations and the fact that almost all Chinese utility models are filed for domestic consumption means that some quite genuine and significant patents might be declared invalid.
So our advice remains as before, think about what you want from a potential infringer – stopping them trading and attempting to maintain a monopoly position is always one option, but this cannot be a commercial result if it ends in litigation against yourself and your patent being declared invalid. It is much better to have considered the option for licensing of the patent (even at a nominal rate) so that your IP remains intact, your list of licensees continues to grow and additional revenue streams are opened up.