Infringing products and unjustified threats: the case of Carku v NOCO

The doctrine of unjustified threats provides protection against a party being threatened unfairly with legal action when there has not actually been any infringement.

It is an objective test where it is considered whether a reasonable person would understand that the threat has asserted the existence of and infringement of rights.

Background

This decision is the first UK court decision involving threats of patent infringement which were made through Amazon’s online complaints procedure.

The owner of the patent, NOCO Co. (NOCO), filed multiple complaints through Amazon’s complaints procedure, alleging that their patent was being infringed by some Shenzhen Carku Technology Co. (Carku) products which were being sold on Amazon. They requested that Amazon remove the Carku products from the website.

Amazon sent a letter to Carku’s solicitors suggesting that Amazon agreed that the Carku products infringed NOCO’s patent. Several Carku products were subsequently taken down from Amazon’s site.

Carku sought to revoke NOCO’s patent and alleged their complaints against them were unjustified threats. NOCO defended the validity of their patent and counterclaimed that the Carku products infringed their patent.

Decision

The judge found that some of Carku’s products did infringe NOCO’s patent, however, the judge also found that NOCO’s patent was invalid due to the presence of prior art.

The court then considered the unjustified threats issue. The judge referred to case law which stated that when deciding if a communication amounts to a threat, it is to be considered whether an ordinary reasonable person in the position of the recipient would have understood the communication to be a threat. A result of this is that simply marking a communication as ‘without prejudice’ will not protect against finding that the communication amounted to an unjustified threat. The judge stressed that a request for removal of a product through an online platform will not always amount to an unjustified threat; it is dependent on the facts.

NOCO argued that it was relevant that Amazon had procedures in place with the aim of protecting customers against infringing products. This demonstrated that Amazon had a greater role in enforcing rights than just receiving complaints through its complaints procedure. Amazon would therefore be unlikely to consider the submission of a complaint via their procedure to be a ‘threat’.

The judge held that in order to argue that Amazon was not threatened with proceedings, NOCO would need to show that in response to their complaint, Amazon automatically removed the offending Carku products, with no consideration of its legal position.

Because Amazon did sometimes allow products which were the subject of a complaint to remain on the website, this showed that Amazon did consider its own legal position by weighing up the risks of allowing the product to continue to be sold on its platform.

The judge concluded that the communications to Amazon amounted to threats of patent infringement if Amazon failed to remove the Carku products.

Comment

This decision was about patents, but it may be applied across trade marks and designs, and where the threats are made via an online complaints platform. Although, the judge stressed that this finding was based on the facts, and the outcome of each case is dependent on its circumstances. It is therefore not the case that any submission of a complaint via an online portal will amount to an unjustified threat of legal proceedings.

Of course, it would be problematic for a platform to delist any product which received a complaint from a party without any consideration as to whether the product is really an infringing product.

Practically, when considering submitting a complaint via a complaints portal it would be sensible to consider what the benefits and likely outcomes might be. Considerations may include who the infringing product is being sold by and the frequency of infringements on the platform.

If you believe your IP rights may have been infringed, get in touch with Briffa to obtain advice.

Written by Laura Gathercole, Trainee Solicitor