Case No. EWHC-932-(IPEC)

Identifying the invention 38.I identified the invention (there referring to it as the inventive concept) in the first account judgment:“[28] … In my view the inventive concept was not just the idea of an insert made of a resilient metal (which was known). It was the composite idea of an insert made of such a metal and its having a particular shape and its interacting with the slot of the panel in a particular way, such that the metal insert could engage with the panel by snap-in means.”39.This characterisation of the invention was approved by the Court of Appeal at [8]-[13]. The alternative ways in which panels were sold with inserts 40.The sales of panels I have to consider under this head were either sold with infringing inserts incorporated in them or the two were sold simultaneously but apart, the inserts then being sold by length, i.e. to be divided into individual inserts by the customer. Panels with incorporated inserts 41.Abbott argued that the inserts and that part of the panel which embodied the invention were together the essential feature of the entire product simply because the invention included part of the panel. I do not accept that this follows. For the reasons discussed above, the question is whether the relevant part was functionally and/or commercially the most important part of the whole.42.Design & Display pointed to the evidence of Mr Lloyd, Managing Director of Design & Display who said that when Design & Display stopped selling infringing inserts, its sales remained constant. I accepted that evidence in the first account judgment (at [46]) but also pointed out that this could have been because Design & Display refocussed its selling strategy on the non-infringing sector of the market. 43.It is probable that only a small proportion of Design & Display’s customers wanted the infringing insert and no substitute, but I do not believe that the proportion was negligible as Mr Lloyd claimed. Mr Lloyd conceded that for some customers the infringing inserts offered advantages and no doubt, while Design & Display continued to offer the infringing inserts, those advantages were emphasised. I think it is likely that for those customers the embodiment of the invention – the infringing insert and the slot in the panel – was the essential feature of the entire product. It is very difficult to say how many they were, but I will estimate that this was the case in relation to 10% of sales.44.Design & Display must pay its entire profit on panels and inserts in relation to that 10% of its sales. Panels separate from inserts 45.I think that on a strict view the panels bought separately from the infringing inserts are not convoyed sales because part of the invention is embodied in the panels. There are therefore to be treated the same way as panels in which the infringing inserts were incorporated.46.Alternatively, in the first account judgment I found (at [30]) that where customers specified a wish to buy the infringing inserts because of the advantages they offered, the inserts drove associated sales of compatible panels which were thus convoyed sales. This was not challenged on appeal. It would follow that Design & Display is liable for the profits made on such sales of both inserts and panels because the sales of the panels were convoyed sales.47.Some of Design & Display’s customers who bought the panels and inserts separately will have wanted specifically the infringing insert. Had Design & Display not been able to provide those inserts, it is likely that those customers would have gone elsewhere for panels. I again estimate that in relation to sales of the panels with separate inserts, 10% of the sales of panels were driven by the sales of accompanying inserts in that way. Abbott is entitled to the whole of Design & Display’s profit on 10% of its sales of infringing inserts and separate but associated panels. The customer did not specify infringing inserts 48.That leaves, in each case, the other 90% of panels sold. Where the customer did not specify infringing inserts, Design & Display still made infringing sales. The question to be resolved is what part of the profit on the sales of the panels is to be apportioned to the invention. Design & Display is liable for that part of the profit.49.In the first account judgment I said (at [32]) that the part of the invention embodied in the panel was only a modest section of the panels sold, namely the slot into which the infringing inserts were fitted. I had in mind the size of the slot relative to the panel as a whole, but I do not believe that this resolves the present issue. I have to consider what proportion of profit made on panels sold should be apportioned to the invention, i.e. the inserts and the slots in the panels into which the inserts fitted. It makes no difference whether the inserts were incorporated before or after sale.50.One, though not necessarily the only way to approach this is by reference to function. The function of the panel is to act as a frame on which goods can be displayed. One of the requirements of the design is to have a slot compatible with the inserts used. That is a minor, but not insignificant part of the whole function.51.The best way to estimate the correct figure is to separate the profit on panels and inserts. Abbot is entitled to the whole of the profit made on the relevant inserts plus 10% of the profit made on the panel.