A Patent is a right associated with any new invention resulting
from a novel idea or novel improvement of an invention protected by
a patent, in all fields of technology, whereby the idea or
improvement is based on scientific principles and capable of
industrial exploitation, whether be it new industrial products, or
developed industrial methods, or new applications of common
industrial methods.
In general terms a patent is an exclusive right granted for an
invention, which is a product or a process that provides, in
general, a new way of doing something, or offers a new technical
solution to a problem.
In order to be patentable, the invention must fulfill certain
criteria which are novelty, inventive step and industrial
applicability. A patent provides protection for the invention to
the owner of the patent for 20 years. Once a patent expires, the
protection ends, and an invention enters the public domain and
becomes available to commercial exploitation by others.
Patent protection means that the invention cannot be commercially
made, used, distributed or sold without the patent owner's
consent. These patent rights are usually enforced in a court,
which, in most systems, holds the authority to stop patent
infringement. Conversely, a court can also declare a patent invalid
upon a successful challenge by a third party.
In the UAE, as is the case internationally the right to a patent
may be assigned or licensed to a third party. An assignment shall
have no effect against third parties unless it has been recorded at
the Patent Office and published in the Official Gazette. Working of
patents in the UAE is an official requirement. However, under
article 24 of the Federal law no. 17 for the year 2002 for
Protection of Industrial Property – ("UAE Patent
Law") - If the owner of a patented invention does not satisfy
the stipulated working requirements within three years from the
filing date, or the owner refuses to license it under a contract of
fair terms, then the patent will be subject to compulsory licensing
under the provisions of the law.
This is a precedent in the UAE. Neither of the parties were
represented by Al Tamimi & Company.
Claim
An action was filed by a local UAE individual (the
"Claimant") against a local Telecommunication company
(the "Defendant"). The Claimant requested the Court to
appoint an expert to investigate the element of his Patent and to
assess its use/exploitation by the Defendant - without his
knowledge and approval - and the benefits that it gains from such
use. The Claimant requested the Court further to order the
Defendant to pay him US$20M as compensation (which was later
amended to AED 100 million (the "Compensation") along
with legal fees.
Facts of the Claim
The Claimant contended that on 5th November 2003 he had a
priority right to register his patent for a system that permitted
the transmission of high quality audio and video sound over the
internet. Subsequently, on 2nd November 2004 he filed an
international Patent application. This was followed on 6th March
2006 by the filing of a local application with the Ministry of
Finance & Industry ("MFI") to register his invention.
It was alleged by the Claimant that "as his invention allows
the direct broadcasting for satellite TV programs through the
internet" the Defendant is violating his exclusive right by
using, launching and broadcasting to the user through a service,
the so called "mobile TV service". The Claimant contented
also that the Defendant's system is broadcasting a TV
transmission with selected content through same process as
prescribed/described in the patent which enables the subscriber,
upon demand, to watch/observe the satellite TV programs by their
mobile in exchange for a monthly fees paid by the subscriber to the
Defendant. This allegedly violated his IP rights and made him
suffer material and moral damages. The Claimant repeatedly warned
the Defendant to stop using his invention but to no avail.
In defense to the application by the Claimant the Defendant requested the court to dismiss the action on the basis of the following reasons:
- The system used by the Defendant differs and does not resemble the Claimant's invention.
- That the Claimant's invention still in its theoretical level and the Claimant did not start using it
- That it bought this system from a Chinese company. However, the defendant requested the court further to join to the case the Chinese company that sold him the system (the "Joinder") – the owner of the system put in place by the Defendant.
Court of 1st instance
On 4th May 2009 the court of 1st instance appointed an expert to
investigate the matter. The expert submitted his report and denied
similarity between the invention and the system in place used by
the Defendant and concluded that:
- The Claimant had previously officially registered his invention locally and internationally;
- The subject of the invention is a system that transmit a high quality audio and video sound through the internet allowing the direct TV broadcasting of the satellite TV programs as specified by the users;
- The system in use by the Defendant is not similar to the Claimant's system and this system was bought from the Joinder.
Surprisingly, the expert ended his report by stating the
"Claimant suffered significant moral damages as a result of
his thinking of the probable using of his invention by the
Defendant".
The Claimant objected to the court on the expert report and
subsequently requested it to appoint a new expert or a committee
(from three experts) to investigate his objection. The Claimant
submitted that the report contained numerous contradictions and was
grounded on documents that were made up by the Defendant.
In reply, the Defendant and the Joinder requested the court to
dismiss the case based on the expert report.
The court of first Instance accepted the Claimant's demand and
appointed a committee of three experts (the "Committee")
to reinvestigate the case based on the claimant's arguments on
the previous expert report.
The appointed Committee submitted its report and concluded that the
Defendant did not use or exploit the Claimant's Patent. The
grounds for the Committee's decision were as follows:
- That the Defendant used a system that is partly similar (~ to 20%) to the Claimant's Patent that was registered since 25th February 2007;
- That the Claimant's invention is not creative;
- That the Claimant failed to prove:
- Full similarity between his invention and the system used by the Defendant; and
- The Defendant's exploitation to his registered Patent
- The Defendant's awareness of the Patent granted to the Claimant.
The Claimant objected to the court on the committee's report and requested the appointment of a committee of three technical experts with extensive patent experience to reinvestigate the case. Furthermore, it submitted a docket list that includes among others an expert report concluding on the case with the following:
- The Claimant's invention is "Identical" to the Defendant's system;
- The Defendant violated and infringed the Claimant's patent. The Committee of Experts arrived at this conclusion from the fact that the Claimant's invention is a system and a method to receive a high quality audio and video sound by accessing the internet in the any user location via a mobile device. The user simply sent his request through the net to choose the content of the video whether directly to any TV channel or to any video content that will be displayed later on or upon request. Previously requests made from a mobile device and the response travelled the same path whereby this caused delay and/or pause to the video link. With the Claimant's Patent the technology utilised two separate paths for the request and response thereby avoiding interference with the video link. The Committee of experts stated that the Claimant's invention was very accurate and it determined that the Defendant's method in using the system is identical to the Claimant's patented system.
The Court of First Instance held that according to article 1 of the Federal Law No. 17 of 2002 Regulating & Protecting Patents and Property Rights in Industrial Designs and Models ("UAE Patent Law"), a Patent is the protection granted by the Industrial Property Department ("IPD") in the Ministry of Finance and Industry ("MFI") to an invention in the UAE. Article 4, 7, 14 and 15 of the said Law read together can be interpreted to mean that granting a Patent for a person shall be interpreted to mean that such invention met the novelty requirements, creativity and industrial applicability. Such Patent confers to the Patentee an exclusive right – for 20 years from the date of filing the application- that includes among others the use and exploitation of the invention and the right to prevent third parties from exploiting the Patentee's right without his consent. Moreover, according to the court a mistake exist whenever it is evidenced that there is an infringement to that patent or there is exploitation to the concerned patent by a third party without the Patentee's consent. The Court stated that by applying these principles to the facts at hand it was obvious:
- That the concerned patent – the subject of this case- was awarded by the IPD in the MFI for the Claimant's invention. This meant that such Patent complied with the conditions stipulated in the UAE Patent Law (novelty, creativity and industrial application). The court interpreted art 7 and 15 of the said Law to mean that such infringement or use without the Patentee's consent evidenced that the infringer committed a mistake.
- That the date for application of this Patent - as shown in the certificate – is 6th March 2006;
- That such patent was published in the Official Gazette no. 459 (December issue)
- The Claimant had on 2nd November 2004 filed an international application for his invention and subsequently the international publication was done on 19th May 2005.
The result was that the Claimant was found to be the person
entitled to enjoy the right conferred for a Patentee (Patent owner)
and that his invention complied with the conditions and
requirements of the UAE Patent Law.
The Court held that the expert's report submitted by the
Claimant provided a detailed explanation for a patent and defined
it by a creative and novel idea that resolve a technical issue for
the sudden stop of the video displayed on the screen through the
internet. This sudden stop is caused by the re-uploading process
that leads to the non clearance of the audio and video sound. To
avoid this problem the Claimant found a creative solution in this
regard, the originality in this invention can be reflected by the
two net that were found, where the first one deals only with the
request to be sent from the user and the second one deals with the
received request. This invention permits the direct TV broadcasting
for satellite programs (transmitted through satellite channels) or
video channels identified by the user through three different
options included in this invention such as direct broadcasting,
recorded video or video upon request which were not used before as
the current system did not allow for direct TV broadcasting as it
relied on one net with a two way direction to send and receive the
request in the same time which was causing delay or the sudden stop
before the Claimant's invention and its registration in the
UAE. The expert report concluded that the system used by the
Defendant is completely identical to the Claimant's invention
as it was carried out with the same method of the claimant's
invention system upon logging on the net through the user's
mobile phone based on the different path and not one path as was
carried out previously before the emergence of the Claimant's
invention locally and internationally.
Based on this Committee of Experts report, the Court of First
Instance decided that the Defendant is using an invention that is
identical to the Claimant's one and that the former infringed
the Claimant's Patent that is considered as a novel application
of a known technical method to resolve the problem of the sudden
stop of loading or its delay. The result of this finding was that
the Claimant's invention was new and creative and was not in
use or published in the UAE and the IPD did not grant any patent in
this regard prior to the Claimant's patent. The Court supported
its finding by an article published on 24th November 2008 in
Alkhaleej newspaper (issue no. 10781) where the Defendant declared
the launching of a new mobile TV service that allows customers to
watch satellite TV programs on their cell phones. The Court held
that it has the full discretion to rely on that report despite it
did contradict the two reports submitted by the court appointed
experts as these reports are not binding to the court as stipulated
by article 90 (1) of the Federal Law no. 10 of 1992 - Law on
Evidence for Civil and Commercial Transaction ("ECCT").
As per article 90 (2) of the ECCT the reasons given by the court to
refuse such reports were that:
- For the first one the conclusion drawn by the expert can be summarised by "the system in use by the Defendant is not completely similar to the Claimant's system and that the Claimant suffered significant moral damages as a result of his thinking of the probable using of the invention by the Defendant" which demonstrates that the expert was unable to decide on the merit of the case and was not persuaded by what he was doing. However the court drew a conclusion from that report that there is some similarity between the Defendant's system and the Claimant's invention.
- For the second report the court applied the same reasons that were addressed to the first report but added to the conclusion drawn by the Committee "that the Claimant failed to prove the Defendant's awareness of the patent granted to the Claimant's" that this conclusion contradict the laws applied in this regard as it is assumed that everyone shall be aware and nobody can allege the ignorance of law as the Patent was published in the official gazette. Furthermore, for the court the committee's conclusion that the Claimant's invention is not creative contradicted to a large extend with the fact that the Claimant was granted a Patent from the IPD that has examined it and confirmed the existence of the three criteria that are imposed by law (creativity, novelty and industrial applicability). Finally the court criticised the committee's conclusion that the Claimant failed to prove the similarity between his invention and the system used by the Defendant and the latter's exploitation to his registered Patent and held that this conclusion prove that it is the committee who effectively failed to achieve their work properly.
- Furthermore it was held by the court that the 20% similarity decided by the committee between the Defendant system and the Claimant's Patent is a very dangerous proportion that proves that the Defendant did infringe the Patentee's right.
- In light of the above, the court commented that the committee should have issued a report in favour of the Claimant as the Defendant did use a system that was not in use before the granting the Claimant such Patent.
The Court held that based on the above it was very obvious that
the Defendant infringed the Patentee's right. This infringement
will invoke the Defendant's tort liability that includes three
elements (mistake, damages and causal relationship) and make the
Defendant subject to payment of compensation. Based on article 282,
292 and 293 of the Civil Code the Court ordered the Defendant to
pay a compensation to the Claimant amounting to AED 30,000,000.
Furthermore, the court ordered the Defendant to stop exploiting the
system that is infringing the Patentee's right.
Court's decision on the Defendant
arguments
The court dismissed the Defendant's arguments that it bought
the system from the Joinder stating that such a purchase does not
exempt it from responsibility. Furthermore, the Court refused the
Defendant's argument that the Claimant's invention was
still in its theoretical level and the Claimant did not start using
it as such an explanation will permit the other from exploiting
people's idea on the basis that it is still an idea which
contradict article 15 of the UAE Patent Law that acknowledges the
Patentee's exclusive right to exploit his invention whether
still an idea or whether the Claimant started using it. The Court
held that the Defendant failed to prove that he is enjoying an
exceptional right – a Compulsory License - as stated in
article 24 of the said Law. The court further dismissed the
Defendant's request to join the Joinder Company to the case as
the Defendant failed to provide the contract that proves the
obligations as between the Defendant and the Joinder.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.