Monday, 10 August 2009

When do you sue a holding company?

Fabio Perini SPA v LPC Group Plc & others [2009] EWHC 1929 (Pat), a Patents Court for England and Wales decision of Mr Justice Floyd, raised -- among other things -- a small question of interest: in what circumstances should one join as a defendant in patent infringement proceedings a company whose only involvement is that it is the holding company for another company which purchased infringing goods from the principal defendant?

In this case, the claimant's patents were for machinery and a method for sealing the tail ends of rolls of paper. Floyd J pointed out that the case against the holding company (LPC Group) was based on the fact that the letter from the patent owner (Perini) before action, addressed to LPC Limited (its subsidiary which purchased the infringing goods from the principal defendant, PCMC) elicited a response on LPC Group's notepaper which affirmed "We purchased the equipment from PCMC". Said Floyd J at para.181:
"I do not think this is enough to cause LPC Group to infringe on any basis. The method is operated by LPC Limited, not the parent holding company, although I can understand why Perini may have been sufficiently uncertain so as to sue. I doubt the point has any real significance".

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