Schutz v Werit – (currently being heard in the Supreme Court)

This patent case is of interest to the University sector if only because it illustrates that simple inventive concepts, ordinarily protectable by legal process and registration, can be easily infringed by ordinary processes of manufacture. The case explores what is meant in patent terms by infringement by ‘making’ within section 60. There were issues as to whether the invention within the structurally enhanced cages was of itself valid; but such issues fell by the wayside between the parties – the litigation heading towards infringement by making/manufacture.

In the appeal of Schutz Ltd v Werit Ltd, currently being heard in the UK Supreme Court, the case concerns a patent infringement claim pursuant to section 67 of the Patents Act 1977 (brought by Schutz – the respondent (exclusive licensee) who owns the patent to a large durable container used for transporting liquids (‘an intermediate bulk container’ (IBC) – plastic bottles within a metal cage frame. The appellant company (Werit) manufactured a replacement part for the container (the supply of its own plastic bottles (cross-bottling), and initially defended the claim for infringement on the basis of invalidity (being insufficient, or being so ambiguous as to be incapable of infringement) of the patent. As previously stated, the issue of validity of Schutz’ patent in the IBC fell by the wayside.

At first instance – before Floyd J finding in favour of Werit (the infringers)

At first instance, Floyd J (applying a whole inventive concept test – namely, considering whether, when the part in question was removed, what was left embodied the whole of the inventive concept of the claim’. Applying the test, the whole of the inventive concept being in the cage, replacement of the bottles was, according to Werit and their associated infringers, a repair of, rather than a ‘making’ of an IBC. Floyd J seemed to agree.

The Court of Appeal – the judgment of Jacob LJ

The remaining issue,according to Jacob LJ in the Court of Appeal, was whether providing the replacement of part of a patented product amounted to “making” that product; and thereby infringing the rights of the patentee under the Patents Act 1977, s 60(1)(a). That section, setting out what is termed direct infringement, applies:

(a)where the invention is a product, he makes, disposes of, offers to dispose, uses or imports the product or keeps it whether for disposal or otherwise.’

In the Court of Appeal, Lord Justice Jacob in characteristically direct terms, set out the ‘question in this case’ to be:

‘The upshot is simply this: does the act of putting a bottle into a Schutz cage, constitute ‘making a product which is the subject matter of the patent’ within the meaning of Article 20 of the Community Patent Convention?’ (cf. a provision which is in the same terms as section 60(1) (a)).

Licences and sub-licenses as the basis for infringement rejected

It is noteworthy that all the prior arguments about express and implied licences for the alleged infringers re-bottling (replacing a bottle with a bottle from the original manufacturer) or cross bottling (replacing the bottles with bottles from a different source), all fell by the wayside, on account of clear evidence from the patentee of its objections to cross-bottling, being objections they clearly set out in their terms and conditions. The vehement objection of the exclusive licensee to ‘cross-bottling’ by the cross-bottlers (Werit and their associates) was at the heart of the dispute.

Is there a concept of ‘whole of the inventive concept’ in infringement?

This test appears to ask: in relation to infringement, considering what is left, when the part repaired is being removed, does the remainder embody the whole ‘inventive concept’ of the patented claims? The inventive concept test appears to apply where replacement or repair appears to replace a part embodying the invention. When a repair replaces a part embodying the invention there might be infringement – so this test goes.

Werit, as alleged infringers, argued that if the cage embodied ‘the whole inventive concept’ of the invention, a party simply engaging in the act of putting a new bottle into an existing (Schutz) cage could not be said to be ‘making’ the patented article. There appears to be a distinction between manufacture and repair, but it appears clear that section 60 is concerned with the question whether the infringer has ‘made’ the patented product. Werit in the appeal before the Supreme Court, also appear to have run a strong argument that this is a case involving the incorporation of a ‘consumable’ and should exceptionally be treated differently in a case where the patent resides more in the cage, and that the monopoly effectively granted to the patentee would in this case include the ‘after market’ of reinserting the plastic bottles – something which no other parties could do without infringing the patent. It remains to be seen whether this argument is taken up in the final appeal.

The Court of Appeal decided (following the decision of United Wire v Screen Repair Services [2000] 4 All ER 353 [2001] RPC 24, that repair could amount to ‘making’ within section 60, and therefore amount to infringement. So the fitting of new third party bottles (i.e. Non-Schutz original manufacturer bottles) into Schutz cages, would amount to infringement of the patent. Jacob LJ appears to have reasoned that the only question of importance was whether the alleged infringer had made the patented product. It was within the remit of making for Werit (or their sublicensees) to have done that when replacing Schutz’s bottled with those manufactured by Werit. Indeed, one of the infringers had significantly described in their website, to activities including ‘re-manufacturing’ of the IBCs.

An interesting discussion that was not ventured into was the operation of competition principles in the area of inventions; with Schutz’s patent upheld they effectively monopolised the market in unpatented replacement bottles for the Schutz cages. Jacob LJ would not be drawn on the issue arising on the ‘re-stringing’ of the tennis rackets example; if the invention resided in the inventive frame. Jacob LJ did not consider he had to give an answer to the ‘re-stringing’ problem. This links to Werit’s argument that this case is unique in dealing with a ‘consumable’ (the replaceable bottles) and that there is an inequity in permitting the patentee to have an effective monopoly of the ‘after market’ in replacing the bottles. This is a novel argument distinguishing the leading authority of United Wire, and it will be interesting to see what the Supreme Court make of it, all puns unintended.

The ongoing problem of replacing components of a patented product

The boundary between ‘repair’ and ‘making’ remains uncertain; it remains to be seen whether the Supreme Court will provide clarity on this issue.

The ongoing Supreme Court hearings via Sky can be found at:

The Court of Appeal and first instance decisions in Schutz v Werit can be searched for on the Bailii case law resource site at: