Tuesday, 19 March 2013

Non-imminent standardisation no ground for expedited trial

Polymer Logistics (Israel) Ltd v DS Smith Plc, a Patents Court for England and Wales decision of Mr Justice Mann on 7 March (not available on BAILII), addressed the question of when a patent owner might be able to apply for and obtain an expedited infringement trial.

PLI had a patent for a pallet dolly system and sought a speedy trial of an alleged infringement by Smith, with which PLI held a virtual market duopoly. Initially the trial date was set for March 2014, but PLI sought to expedite that hearing to July 2013, maintaining that a lack of expedition would be seriously unfair. Why was this? PLI was concerned that the expected market standardisation of pallets would occur over the next six months and that this would be in Smith's favour, with the result that PLI would not be able to penetrate the market further. Smith's pallet system was already used by Tesco, a large United Kingdom supermarket chain, and was also of potential interest to other supermarket chains and food suppliers. Another supermarket chain, Morrisons, had trialled PLI's products but had put those trials on hold. According to PLI, there was a strong market interest in the standardisation of pallets and that Tesco's acquisition of large number of Smith's pallets meant that Tesco might confine itself to that product in the future, generating a "domino effect" on Tesco's suppliers. This in turn would precipitate a de facto pallet standardisation which, PLI argued, would occur before the original trial date in March 2014. Once de facto standardisation had occurred, said PLI, it would be impossible to undo. This would mean that victory in a subsequent patent infringement trial would be hollow and damages would be an inadequate remedy.

Mann J declined to order an expedited trial. In his view, an application for an expedited trial had to demonstrate a real and justifiable urgency.  PLI could not be said to have shown that this was the case. While it was clear that Tesco was using Smith's product, the evidence demonstrated that supermarkets were cautious in relation to major changes affecting logistics. This was because any breakdown in logistics would be disastrous; accordingly it was not conceivable that the market would come together within six months to flood the market with Smith's product. It had not been proved that the original trial date of March 2014 had suddenly become inappropriate, so the application must be refused.

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