9 March, 2017
In Towa Corp v ASM Technology Singapore Pte Ltd and another [2016] SGHC 280, the High Court considered whether the plaintiff was liable for making groundless threats of infringement proceedings. Facts The plaintiff, Towa Corporation, is the registered proprietor of a product known as IDEALmold machine (the "Patent").
The 1st defendant, ASM Technology Singapore Pte Ltd, is a Singapore incorporated company that is wholly owned by the 2nd defendant, ASM Pacific Technology Limited.
The plaintiff commenced an action against the defendants for infringement of the Patent. Meanwhile, the defendants, apart from defending the claim, also argued that the plaintiff had breached s. 77 of the Patents Act (the "PA") for groundless threats of infringement proceedings. Holding In determining whether s. 77 of the PA applied, the Court had to consider whether the 2nd defendant fell within the definition of a "person aggrieved by the threats" of infringement proceedings.
This claim did not arise for the 1st defendant as it had infringed the Patent. The Court construed s. 77 of the PA as being "concerned with the commercial interests of a plaintiff who brings a claim under the section". Specifically, the section only applies to those who are affected by such threats due to the nature of their businesses. The 2nd defendant argued that its commercial interests were affected by the plaintiffs' threats as it had to devote significant time to answering them and they were a distraction from its commercial business.
The Court however held that the 2nd defendant was not a person aggrieved. It was therefore not entitled to rely on s. 77 of the PA. In reaching its decision, the Court had regard to the fact that the 2nd defendant was an investment holding company and was not involved in the 1st defendant's manufacturing or sales operations. As such, the plaintiff's threats involving the IDEALmold machine could not have affected the 2nd defendant's business.
Comments
This case clarifies that a failure to establish liability for infringement will not automatically give rise to a remedy for groundless threats of infringement proceedings. It is now clear – at least for patent infringement cases – that the courts will engage in an examination of the locus standi of litigants to determine if they satisfy the specific requirements of s. 77 of the PA.
For further information, please contact:
Andy Leck, Principal, Baker & McKenzie.Wong & Leow
andy.leck@bakermckenzie.com
