Beloit Technologies Inc & Anor v Valmet Paper Machinery Inc & Anor

Factual and Procedural Background

The parties in this appeal are Company A (Appellants) and Company B (Respondents), involved in a dispute over two patents relating to apparatus for drying a paper web. Company A owns European Patents UK 0334 899 ("899") and UK 0345 266 ("266"). In 1993, Company A alleged that machinery dryers offered by Company B infringed patent 899. Company B countered by petitioning for revocation of that patent and denied infringement, adding a counterclaim for revocation of patent 266 when it was later included. The trial before the High Court Judge in 1995 resulted in a finding that both patents were invalid, with an order for revocation stayed pending appeal. Company A appealed, and Company B responded with a Respondents' Notice. The appeal focuses on specific issues of novelty and obviousness of certain claims and the jurisdiction of the English courts to revoke patents under opposition at the European Patent Office (EPO).

Legal Issues Presented

1. For Patent 899:
   1. Is claim 2 novel over US Patent 4359 827 (Thomas)?
   2. Is claim 2 obvious?
2. For Patent 266:
   1. Is claim 12 obvious?
   2. Does the accused machinery (Aylesford Mk I) fall within claim 12?
   3. If yes, is it anticipated by the application for patent 899?
3. Should Company A be granted leave to amend their Notice of Appeal to challenge the court's jurisdiction to revoke patents during EPO opposition proceedings?
4. Was the trial Judge correct to order revocation of the patents?

Arguments of the Parties

Appellant's Arguments

• Claim 2 of patent 899 is not anticipated by Thomas because the prior art does not clearly and unmistakably direct the use of suction rollers as claimed.
• The concept of inversion by group was not part of the common general knowledge and had never been practically applied before the priority date.
• The Judge erred by conflating knowledge of some designers with common general knowledge and by allowing hindsight to influence his obviousness assessment.
• Company A contended that the English courts lack jurisdiction to revoke patents during EPO opposition proceedings under section 77(2) of the Patents Act 1977.

Respondent's Arguments

• Claim 2 is not anticipated by Thomas but the Judge was correct to find it obvious.
• The concept of inversion by group formed part of the common general knowledge, even if not yet practised.
• Extension of the Bel Run single tier arrangement by inversion and positive transfer was an obvious development to skilled persons.
• Section 77(2) preserves EPO opposition procedures but does not oust the English courts' jurisdiction to revoke invalid patents pending EPO appeals.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court began by adopting the factual background and technical context as set out by the trial Judge, which was unchallenged by the parties. The patents concerned improvements in paper drying machines, specifically apparatus for drying a paper web using single tier dryer sections and suction rollers for positive transfer of the web between sections, avoiding open-draws and drying both sides of the web.

Regarding novelty, the Court agreed with the trial Judge that Thomas did not anticipate claim 2 because the prior art did not provide clear and unmistakable directions to construct the apparatus as claimed, particularly the use of suction rollers as defined.

On obviousness, the Court applied the Windsurfing approach, identifying the inventive concept as inversion of dryer groups combined with suction roll transfer to dry alternate sides of the web and avoid open-draws. The Court examined common general knowledge, concluding that while the concept of inversion was known to some designers, it was not shown to be part of the common general knowledge accepted by the bulk of skilled persons. However, the Court found that extending the Bel Run single tier arrangement by inverting groups and using suction rolls for positive transfer was an obvious development to the skilled person, supported by contemporaneous evidence and expert testimony.

For patent 266, claim 12 was accepted to be obvious if claim 2 of 899 was obvious, and the Court did not further consider obviousness separately. The Court applied purposive construction principles from Improver to conclude that the accused machinery (Aylesford Mk I) did not fall within claim 12 because it did not meet the essential limitation of the claim regarding the position of the inverted group.

On the jurisdictional issue, the Court interpreted section 77(2) of the Patents Act 1977 as preserving the operation of EPO opposition proceedings but not removing the English courts' jurisdiction to revoke invalid patents during those proceedings. The Court reasoned that parallel proceedings and potential conflicts are inevitable, and the courts have mechanisms such as stays to manage them. The Court rejected the submission that the English courts are precluded from revoking patents pending EPO appeals.

Holding and Implications

The appeal is dismissed. The Court affirms the trial Judge's order that the patents are invalid and should be revoked, subject to a stay of the revocation order pending any further appeal to the highest court.

The Court grants leave to Company A to amend their Notice of Appeal to raise the jurisdictional issue but ultimately rejects that submission on its merits.

The direct effect is that the patents remain revoked in the UK, but the revocation order is stayed to allow for possible further appeal. No new legal precedent is established beyond the application of existing patent law principles and statutory interpretation of section 77(2) of the Patents Act 1977.