This is a Malaysian case relating to YKL Engineering Sdn. Bhd. (hereinafter referred to as “the Plaintiff”) v Sungai Kahang Palm Oil Sdn. Bhd. (hereinafter referred to as “the 1st Defendant”) and and Profina Teknik Sdn. Bhd. (hereinafter referred to as “the 2nd Defendant”) which concerns patent and copyright infringement issues.
The Plaintiff is a design and manufacture company of specialized machinery and equipment for palm oil processing and is the owner of Malaysian Patent No. MY-139512-A (hereinafter referred to as “the Patent”), which relates to a machine for splitting palm oil fruit bunches known as “Fruit Bunch Splitter” (hereinafter referred to as “the FBS”). The Plaintiff also claimed ownership over the copyright subsisting in the artistic works in a drawing and design of the FBS that the Plaintiff claimed to have created themselves.
The 1st Defendant is a company which operates palm oil factory where else the 2nd Defendant is a company which is in the business of trading and maintenance of equipment and machinery.
The Plaintiff brought an action against the 1st and 2nd Defendants for patent and copyright infringement in the High Court, claiming two units of the FBS used in the 1st Defendant’s factory was a reproduction of the Plaintiff’s FBS and the 1st Defendant had caused the 2nd Defendant to reproduce the FBS.
The 1st and 2nd Defendants denied the Plaintiff’s allegations and counter claimed for invalidation of the Patent on the ground of lack of novelty and inventive step. The 1st and 2nd Defendants also sought a declaration that no that no copyright subsist in the copyrighted works, as the Plaintiff’s drawing and those three dimensional machines have infringed the copyright of earlier prior published drawings and three dimensional machines which were created and therefore there is no infringement of copyright.
The High Court found in favour of the Plaintiff and dismissed the 1st and 2nd Defendants’ counter claim. The 1st and 2nd Defendants appealed to the Court of Appeal ((hereinafter referred to as “the CoA”) contending in essence that the claim was wrongly allowed because the Patent was invalid and that copyright never subsisted over the work, and in any case, there was no infringement, be it of patent or copyright.
CoA reversed the decision of High Court and found in favour of the 1st and 2nd Defendants. In reaching its decision, the following salient issues of fact and law were highlighted.
Construction of patent
The CoA found that the High Court did not construe the Patent properly and had erroneously left the task to the experts.
In any patent infringement and/or challenge on its validity action, it is axiomatic duty of a Court to first construe the patent to determine what exclusive right in the invention has been granted to the patentee.
In construing a patent, it is to be borne in mind that the invention is spelt out in the specification or description, where else the patent is found in the claim, which enumerate and define the monopoly of the patent. A purposive approach is to be adopted when construing the patent, i.e. the courts should be concerned with what a notional addressee would have understood by the words in contrast to what the author would have meant to say.
Expert are to only assist the Court in understanding the meaning of technical words and phrases, and it is the duty of the Court and not the experts to construe the patent.
Novelty – pleadings on prior art
The CoA also observed that the High Court had failed to admit into evidence and consider one of the prior art, which the 1st and 2nd Defendants did not plead but sought to introduce at the trial. Failure to plead a prior art is not fatal and it could be introduced as an evidence during trial.
Matters which must be specifically pleaded, in accordance to order 18 rule 8, Rules of Court is the defence of anticipation by prior art, that there has been disclosure to the public, that there is common general knowledge in the art and that there is no inventiveness.
These are material legal pleas which must be pleaded before any evidence is led. The particulars of the pleas should be provided to enable the other party to prepare for the trial, however it need not be complete.
These pleading were already pleaded by the 1st and 2nd Defendants; with them giving examples of the prior art, amongst which or “inter alia” where they listed a list of prior art.
The 1st and 2nd Defendants are not confined to the pleaded prior art and could offer other examples which are not pleaded, the admission and treatment of which is at the discretion of the High Court.
On the facts of the case and in light of the pleadings, CoA was of the view the evidence of the prior art could be admitted in evidence as it did not prejudice, cause grave injustice or surprise the Plaintiff.
Wrongful rejection of expert evidence
The High Court had rejected two expert evidences of the 1st and 2nd Defendants, on the ground of their reports being similar in terms of the phrases used and conclusion, leading to the speculation that the reports were prepared by someone else.
Similarities in phrases and words used, is frequently found in any industry or profession and it can be regarded as a norm or standard. The CoA said that Courts should only concern themselves if the expert evidence is of relevance and credible assistance. What is of importance is the individual reasoning given by the experts in coming to the conclusion and not the similarity in phrases and words used.
Novelty: Non-disclosure of prior art due to confidentiality
The High Court, did not consider a prototype of the Plaintiff’s machine despite 1st and 2nd Defendants having pleaded it and led evidence and extensively addressed the issue. The learned Judge did not give reasons for the failure in considering it as an evidence.
The Plaintiff contended that the prototype was kept a secret and not disclosed due to confidentiality, privacy and secrecy and the 2nd Defendant was in breach of confidence by using the information learned from the prototype. The Plaintiff claimed that the 2nd Defendant was not free in law and in equity to use the information and even if the information was disclosed to the public, the information did not form part of the state of prior art.
The COA disagreeing with the Plaintiff’s contention ruled that in action for breach of confidence, the requirement laid in laid in Coco v A.N. Clark (Engineers) Ltd (No. 2) [1969] RPC 41, 47 which says that:
“First, the information itself … must have the necessary quality of confidence about it. Secondly, that information must have been imparted in circumstances importing an obligation of confidence. Thirdly there must be an unauthorized use of that information [possibly] to the detriment of the party communicating it.”
Novelty – Prior Art Drawing
The CoA was of the view, the High Court had wrongly rejected the 1st and 2nd Defendants’ drawing of a machine as evidence of prior art and held it should have been accepted as an evidence.
The High Court seemed to have based its decision on the objection raised by the Plaintiff, in that the drawing did not have explanations attached to it and it was of no use. The Plaintiff contended one who looks at the drawing will not be able to construe what is found in the drawing as it does not explain or show how the machine is to be constructed or works.
In admitting a prior art drawing as evidence it was not necessary for prior existing drawings to come with labels and details. What’s required is, that the drawing should be able to be understood and explained by a person skilled in the art with the necessary common general knowledge.
Obviousness – Lack of inventive step
The learned Judge did not address the issue of inventiveness adequately and wrongly found there was an inventive step in the Patent.
The High Court seemed to have considered the prior art in context of novelty but drew his conclusion for both novelty and inventiveness.
In an action on patent validity, it is paramount for the Court to assess the inventive requirement independently and apply the Windsurfing test established in Windsurfing International Inc v Tabur Marine (Great Britain) Ltd (1985) RPC 59. The four step test laid is as follows:
“The first is to identify the inventive concept embodied in the patent in suit. Thereafter, the Court has to assume the mantle of the normally skilled but unimaginative addressee in the art at the priority date and to impute to him what was, at that date, common general knowledge in the art in question. The third step is to identify what, if any, differences exist between the matter cited as being “known or used” and the alleged invention. Finally, the Court has to ask itself whether, viewed without any knowledge of the alleged invention, those differences constitute steps which would have been obvious to the skilled man or whether they require any degree of invention.”
Copyright
In regards to the issue of copyright CoA held that the Plaintiff did not own the copyright to the drawing of the FBS and in its three dimensional embodiment. Hence there is no issue of infringement.
In view of existence of prior existing drawing and the prototype, there can be no copyright on the Plaintiff’s work. The Plaintiff’s drawing would substantially be reproduction of the other prior art documents relied on by the 1st and 2nd Defendants, in which case it cannot be said that the Plaintiff had expended sufficient skill and effort to render the work original as required by the Copyright Act 1987.
CoA held in absence of a copyright there can be no issue of infringement.
In its judgement, CoA made reference to Megnaway Enterprise Sdn Bhd v Soon Lian Hock (sole proprietor of the firm Performance Audio & Car Accessories Enterprise) [2009] 3 MLJ 525 which adopted the principles laid down by Sir Raymond Evershed MR in Purefoy Engineering Co Ltd v Skyes Boxall & Co Ltd [1955] 72 RPC 89; that in order to establish copyright infringement, the following elements must be proved:
(a) there is sufficient objective similarity between the original work or a substantial part thereof, and the infringing copy;
(b) there is a causal connection between the original work and the infringing copy, that is, the infringing copy must have been copied from the original work, whether directly or indirectly; and
(c) what has been infringed must constitute a substantial part of the original work.
The CoA revisited if not laid down the cardinal principles which should be borne by Courts in dealing with patent/copyright infringement and/or validity action. Courts should be vigilant, applying established judicial principles in reaching its decision. The decision of the CoA certainly has provided clarify in principal areas of law which would serve as a guide in future actions.