Saint-Gobain PAM SA v Fusion Provida Ltd & Anor [2005] EWCA Civ 177

Case No A3/2004/2441[2005] EWCA Civ 177
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION (PATENTS COURT)
The Hon Mr Justice Pumfrey
HC 04 C00060
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate Friday 25 February 2005
Before
LORD JUSTICE PETER GIBSONLORD JUSTICE SCOTT BAKERLORD JUSTICE JACOB
Between
Saint-Gobain PAM SARespondent/ClaimantFusion Provida LimitedAppellants/Electrosteel Castings LimitedDefendants
(Transcript of the Handed Down Judgment ofSmith Bernal Wordwave Limited, 190 Fleet StreetLondon EC4A 2AGTel No: 020 7421 4040, Fax No: 020 7831 8838Official Shorthand Writers to the Court)
Alastair Wilson QC and Peter Colley (instructed by Messrs BrowneJacobson Llp) for Respondent/ClaimantRoger Wyand QC and Jonathan Hill (instructed by Messrs Bird & Bird) for Appellants/Defendants
Judgment
[1]This appeal is from a judgment of Pumfrey J given on 3rd November 2004. By the time the matter came before him the only issue was the validity of the European Patent (UK) No 0686246. It was and is accepted that if the patent is valid then the defendants (between whom there is no material difference) infringe. The Judge held the patent valid and accordingly infringed. The only issue is an obviousness attack.[2]The patentees, for whom Mr Wilson QC appeared, are Saint-Gobain PAM SA. This is a very large company in, inter alia, the underground pipe (typically for sewage or water supply) manufacturing business. The defendants are also in that business but are a much smaller enterprise. Mr Wyand QC argued their case.

Dates and other basic matters

[3]The agreed priority date of the Patent is 18th February 1993. It is accepted that the case turns solely on the obviousness or otherwise of claim 1. It is said to be obvious having regard to the disclosure in a paper called Johnsson published by the Swedish Corrosion Institute on 18th December 1992 – just before the priority date.

Common General Knowledge

[4]The Patent is directed to the “person skilled in the art” whose attributes I summarised at paragraphs 6-10 of Technip France’s Patent [2004] RPC 46. There is no dispute about the kind of person involved. It is an unimaginative person (or team) in the research department of a company in the underground pipe manufacturing trade. He would have considerable knowledge of the problems of corrosion suffered by buried pipework.[5]Such a notional person would know, and have as part of his/her background knowledge that:(a) It was obviously desirable that buried pipe should be resistant to corrosion over very long periods, not least because corrosion was not readily detectable in use and the cost of replacement generally higher than for accessible pipes.(b) Such piping was typically made of cast iron.(c) “Black pipe” was and had for many years been in widespread use as a successful form of corrosion resistant iron piping for buried use. It was made from three layers: the main, structural layer of ductile cast iron, a layer of Zn and a layer of bitumen.(d) Absent the protective coating, the iron would corrode very readily, particularly in hostile (e.g. acid or saline) soil conditions. You hardly need to be a “skilled man” to know that!(e) The protective coating of Zn was not provided by hot dipping or true galvanisation (i.e. electrolytic deposit). It was sprayed on and so was slightly porous. The outermost layer, sometimes called the “pore-sealing” layer was also slightly porous.(f) For non-buried (above-ground or marine) iron or steel (which itself is mainly iron) a coating of Zn can provide protection by two distinct mechanisms. Firstly, it can simply act as a protective coating preventing water and oxygen from reaching the iron – like a coating of paint or bitumen. Second, however, there is the possibility, if the Zn coating gets wet, of electrolytic action. This is also called “galvanic” or “sacrificial” protection. When iron and Zn are in contact and the combination is in water containing an “electrolyte” (free ions, as for instance in acid conditions) the Zn will preferentially corrode. It is not necessary to explain more here – though every A-level (and probably GCSE) chemistry student will know this.(g) In the case of black pipe a further anti-corrosion effect comes into play. Because it is slightly porous, the surrounding (corrosive) medium penetrates within the Zn. A rigid impermeable layer of Zn corrosion products forms. In due course all the Zn is consumed. So galvanic protection stops. But by then there is a layer of Zn corrosion products. This is itself so tough and coherent that it forms a physical barrier to corrosive products. This barrier lasts for many years. So one gets protection extending well beyond “the life” of the Zn.(h) During the early period of this process another important and remarkable phenomenon occurs. It is hardly surprising that when pipe is being buried it is liable to take a few knocks and get scratched. So some of the underlying iron will get exposed. This is an obvious and serious danger – exposed iron should, in principle, corrode much faster than protected iron. But it turns out that the Zn corrosion products actually migrate to the exposed iron – to the site of the damage. The protective skin of Zn corrosion products builds up on this too. This is obviously very important indeed.(i) There were particular problems with very acidic soils. In these the Zn corrosion product skin would not form. There was a need for a better form of corrosion protection for buried pipe – one that could cater for more stringent conditions than could the existing Zn based black pipe.(j) Mixtures of Zn and Al (as an alloy) were also well-known for general use in corrosion protection. They had been used for years for above-ground and marine uses. But not for buried pipes. It was not known whether such an alloy would also form a protective corrosion skin or would do so as well as Zn alone. The purpose of the Al in the known uses was to slow down the erosion of Zn by galvanic effects.

The Patent in Suit

[6]This begins by acknowledging a prior art proposal for an above ground steel pipe provided with a sacrificial Zn/Al surface covered with an epoxy resin. It goes on to say corrosion of ferrous metals by soil “is a phenomenon whose nature is different from atmospheric corrosion” and points out that soil conditions are diverse and that pipes may have their external surfaces damaged.[7]It then sets out the purpose of the invention:
“The purpose of the invention is to provide a coating technique for a buried iron-based pipe member which is suitable regardless of the purpose of the piping, particularly for water supply and drainage, in most types of soil, at an acceptable cost.”
[8]Next it sets out the invention in what is effectively claim 1, which I set out now:
“1. An iron-based, in particular cast iron, pipe member for buried piping, which is provided with an external coating comprising: - a first porous layer of zinc/aluminium alloy containing 5 to 60% of aluminium; and on this first layer, -a second porous layer, called the pore-sealing layer, based on organic or inorganic binder in aqueous, solvent or powder phase, between 100 and 140μm thick.”
[9]In the body of the specification there are two passages setting out the point of the invention:
“Through the action of corrosive agents in the soil this layer is converted into a protective layer of stable corrosion products in the environment in which it develops. The alloy layer is also called a “sacrificial” layer with respect to the cast iron, in the sense that it can be consumed progressively by oxidation as a result of the electrochemical cell formed by the cast iron, the alloy and the soil, to protect the cast iron underneath or bared at [sic] defects in the layer of zinc-aluminium alloy, through the formation of the said protective layer. …… It has been found that the two-phase structure of the Zn/Al alloy favours the trapping of Zn corrosion products.”
And “The finishing layer, called the pore-sealing layer, is then deposited by spraying. This pore sealant both slows down corrosion of the zinc and consolidates the layer of zinc corrosion products, in order to maintain their protective effect. The thickness of the pore sealant should be sufficient to ensure that this retention takes place, but sufficiently thin for the pore sealant to remain porous, failing which the active species could no longer migrate to the first layer of the coating in order that this first layer plays its part as explained above. Furthermore, too great a thickness of the pore sealant would trap water beneath it and form blisters.”[10]Nothing turns on the detailed parameters of the claim. In substance the invention consists simply in using Zn/Al alloy in place of Zn for buried pipe. The patent tells you this will form a protective layer of corrosion products and that this layer will form on iron “bared at defects” as well as on the iron which remains coated. It also tells you that the upper, pore-sealing layer both slows down Zn corrosion and consolidates the protective layer of Zn corrosion products. It may be noted that the Al does not itself form a corrosion product – its function is to help trap the Zn corrosion product.

Johnsson

[11]This is entitled “Corrosion resistance coatings of Al, Zn and their alloys. Results of 11 years’ exposure in soil.” It is not well-written – largely one has to try to find out what was done from the tables of results. It is worth noting at the outset that it contemplates “a technical service life of approximately 20 years.” This is much too short a period for the skilled man concerned with buried pipes. He wants 50 years as a minimum and often more. So the paper is not one which self-evidently would be of interest to the buried pipe man. The paper’s general conclusions are:
“From eleven years’ field tests the following conclusions can be drawn: - Aluminised steel is in general not more corrosion resistant than galvanised steel in soil. - If a long technical service life is desired, the following is recommended: - For less aggressive soil (e.g. sand), thick aluminium or zinc coatings with a coating thickness of at least 200 μm. - For very aggressive soil (e.g. clay), very corrosion resistant material is required. A thick coating (200 μm) with 50% aluminium – 50% zinc seems promising.”
[12]The testing was of differently coated steel plates. No pipes were tested. Nor was there was testing of any samples which had a porous second layer – what the patent calls a “pore-sealing layer.” Plates of steel with various coatings were buried in different types of soil for 11 years and then dug up and examined visually and by weighing. The coatings were variously of hot-dipped Zn, sprayed Al and sprayed Zn/Al, with and without a paint layer of vinyl paint.[13]There is no mention of observation of Zn corrosion products and no attempt to observe what happened to small areas of exposed steel. This very-important aspect of buried pipe protection was not studied at all. Moreover the visual inspection reported is of “red rust” – the tables report the percentage area of red rust showing. Red rust, of course, means that the corrosion has worked its way through to the underlying steel – what happened to the Zn remains a matter of surmise. The experts were divided on whether one would infer corrosion by galvanic action or by other means, e.g. chemical attack.

The approach to obviousness

[14]It is convenient to follow the well-trodden path laid down in Windsurfing v Tabur Marine [1985] RPC 59 at 73-4. I summarise the steps:(1) Identify the inventive concept of the claim;(2) Identify the common general knowledge;(3) Identify the difference(s) between the prior art and the alleged invention;(4) Decide whether those differences would have been obvious steps.[15]In this case there is no real dispute about any of the steps. The inventive concept is black pipe but made with Al/Zn alloy instead of Zn. The common general knowledge I have identified. The difference is Al/Zn instead of Zn alone. The key question is whether that difference was obvious.

The Judgment

[16]The Judge held the step to be non-obvious. He was in the end influenced by the evidence that the product was superior to black pipe. He concluded:
“This case has given me a great deal of difficulty. My opinion has changed more than once. The various factors to which I have referred seem to me to be rather evenly balanced, but I am influenced in the end by the historical considerations to which I have referred. This can almost be described as a case in which the alleged invention ought to have been obvious. Nonetheless, I conclude that claim 1 of the patent is valid.”
[17]His prior reasoning was plainly influenced by the fact that the invention gives a superior product to the Zn only black pipe in that it will work both in the conditions which such pipe works but also in more hostile conditions. Technical success was the turning consideration. It was this which caused him to reject the “simple” case. He had said earlier:
“I conclude that there are strong technical reasons for supposing that this is, in fact, a case of a simple substitution of one known protective layer for another, suggested by Johnsson.”

The approach on appeal

[18]There is no doubt about this. It was laid down in the single speech of Lord Hoffmann in Biogen v Medeva [1997] RPC 1 at p.45:
“The need for appellate caution in reversing the judge’s evaluation of the facts is based upon much more solid grounds than professional courtesy. It is because specific findings of fact, even by the most meticulous judge, are inherently an incomplete statement of the impression which was made upon him by the primary evidence. His expressed findings are always surrounded by a penumbra of imprecision as to emphasis, relative weight, minor qualification and nuance (as Renan said, la vérité est dans une nuance), of which time and language do not permit exact expression, but which may play an important part in the judge’s overall evaluation. It would in my view be wrong to treat Benmax as authorising or requiring an appellate court to undertake a de novo evaluation of the facts in all cases in which no question of the credibility of witnesses is involved. Where the application of a legal standard such negligence or obviousness involves no question of principle but is simply a matter of degree, an appellate court should be very cautious in differing from the judge’s evaluation.”

The arguments on appeal

[19]Mr Roger Wyand QC accepts the force of the Biogen approach. But, he says, the Judge has made a blunder – an elementary blunder at that. It is this: that the “historical considerations” which tipped the balance were irrelevant. Johnsson was published only just before the priority date. So there is simply no room for historical considerations.[20]It follows, submits Mr Wyand, that the Judge’s view apart from historical considerations should prevail, that this is a case of substituting one protective layer for another, suggested by Johnsson .[21]Mr Wilson QC for the patentees submits that this is not what the Judge really did. The true position is that Johnsson adds virtually nothing to the common general knowledge of the man skilled in the art – common general knowledge which had formed part of the skilled man’s armoury for years. Al/Zn was known as a substitute for Zn in protective coatings for iron and steel used in marine and atmospheric, but not below-ground, applications. The special effect of protection by a Zn corrosion product layer is not mentioned in Johnsson. Nor is the “healing” effect of such a layer touched upon. Still less is there any mention of “trapping” of the layer by the Al. If necessary, Mr Wilson supports his position by relying on a Respondent’s notice which spells out these matters in some detail.[22]To the latter Mr Wyand retorts: “Biogen” – the Judge has formed the view that but for historical considerations the patent is invalid and it is not for the Court of Appeal to interfere with that conclusion because he has made no error of principle. The only error in principle he made was in letting historical considerations prevail, overlooking the date of Johnsson.

My opinion

[23]I do not think the Judge made any error of principle as suggested by Mr Wyand or as suggested in response by Mr Wilson. The reason historical factors are important when one comes to consider Johnsson are simple. The use of Zn/Al in place of Zn as an anti-corrosion coating for above-ground and marine anti-corrosion coatings had been known for years. And it was known that, for these applications, the presence of the Al slowed down galvanic corrosion. One might well think, absent the history, that it was self-evident that the “simple substitution” would work or might very well work for buried pipes too. But despite years of common general knowledge, years in which the “simple substitution” might have been done or at least tried, no-one had done so. Why not? The answer is because below ground protection depended for most of the life of the pipe not on galvanic action, but on the fact that white rust had been formed, both under the outer layer and as a scab on damaged areas.[24]Did Johnsson change any of this? It said nothing about white rust or protection of damaged areas. At best the skilled man might infer [I say “might” because the experts differed] that galvanic action was slowed down by using Zn/Al instead of Zn. That he already knew was true for other applications. That was not, however, what mattered for buried pipes. So there was nothing in Johnsson to galvanise (I couldn’t resist it) the skilled man into action.[25]In this context it must be remembered that the expert evidence was at one that prediction in this field was not possible – indeed even why the corrosion product gave such good protection when Zn alone was used was not understood – Dr Chandler, the defendants’ expert put it this way:
“I think there is a question over why the metal salts are very resistant to removal.”
Later he said this:
“Nothing is really predictable. There are no simple rules available for how corrosion of pipes is affected by soils, there are no simple rules, and there may be interactions that you are unaware of.”
[26]Given that position it is not surprising that Mr Wyand found himself running an “obvious to try” case. The oft-cited case on this is Johns-Manville’s Patent [1967] RPC 479. The alleged invention was for producing shaped asbestos cement articles by the use of a particular class of flocculating agent. This class had recently come on the market and found use in other applications. Diplock LJ put the possible inventive step this way:
“If there is any inventive step involved in the appellants’ claim, it is in the idea of using a known, but recently developed, flocculating agent in a known filtration process”
[27]That is miles away from the present case. It was in that context that Diplock LJ said, when discussing the judgment below:
“The learned judge preferred the expression ‘see without difficulty that these newly-introduced polymers would be of advantage in his filtration step.’ I think that ‘would be’ puts it too high if it postulates prior certainty of success before actually testing the polymers in the filtration process; it is enough that the person versed in the art would assess the likelihood of success as sufficient to warrant actual trial”
[28]The appellants’ problem in this case is that there was simply no likelihood of success. One just did not know what would happen if one tried – and nothing in Johnsson encouraged trial because Johnsson was silent on the vital question of white rust.[29]Mr Wyand suggested that he managed to establish rather more in his cross-examination of Dr John, the patentees’ expert witness. The passages he relied on went as follows:
“Q. And then you say: “However, it should be noted that only one exposure test was carried out for sprayed zinc-aluminium (in clay with sample exposed above the groundwater table) and the samples were only examined at the end of the 11 year test period. Hence any conclusions from the performance of zinc-aluminium spray coating may be regarded as being at best speculative.”
Will you accept that the conclusion that is stated there is a clear suggestion that the 50-50 alloy coating is something that is worthy of further investigation? A. Based on a single test sample, then I agree, yes, it would be worthy of investigating in that particular type of extreme, the aggressive soils.”[30]The witness explained his restriction to testing for aggressive soils as being based on the notion that the Al provided a “passive protection layer”. This is far from the sort of protection given by white rust.[31]Somewhat later on he was challenged further on possible experiments:
“Q. Can I suggest you are going to test things that people suggest have some promise and those are the ones you are going to concentrate on – provided there is not some reason why you think it is definitely not going to work, you are going to test the ones people describe as having some promise? A. You will test things described as having some promise but the situation, again, is that just because something is considered interesting in a research viewpoint does not mean you have any high expectations of it working. But, yes, if you had zero expectation of it working, you would not test it. Q. Well worth trying? A. Difficult question to answer. Depends what the particular criteria are for your test programme, what your other alternatives are, how they weigh in compared to the promise as devised by the salesman who is trying to get you to use that particular coating or that particular system. If you were just looking at these in isolation, then maybe. If you are looking at them as part of an overall test matrix. Without knowing what the overall test matrix is, I could not say whether or not they would be top of the list, middle of the list, bottom of the list.”

Q. Well worth trying?

[32]Shortly after that: “Q. Therefore, a logical way of proceeding is to try some zinc aluminium alloys to see whether the aluminium removes the advantage of zinc or whether it cooperates with it. A. What you get from Johnsson tells you that the aluminium zinc works well in that particular soil condition, which is particularly acidic; which would indicate, yes, if you were aiming purely to develop a coating for acidic soils, that would be a way to proceed. In terms of moving into a more general soil condition, away from either the salinity or the pH, then the other concerns, as I mentioned above in terms of the performance of the aluminium in any protective film and possibly, as you move away from saline conditions, whether or not you are getting any degree, or the extent of the degree of galvanic protection, is still the question. In answer, testing, I could consider it, yes it would be part of the test matrix. As I say, whether it would be your great white hope or otherwise, I could not say.[33]That is far from expressing any confidence in the result of any notional test, still less of a test of a pipe material with exposed damaged areas.[34]Moreover the witness gave a particularly important answer earlier on when talking specifically about protection of buried pipes: A. …. As has been said numerous times over the last few days, the key issue that was identified in the ’92 Compendium is the performance of zinc in soils in the ways that it is not just providing protection whilst the zinc is intact, but also longer after it has disappeared. That is the surprising nature, not just in the general coating which is formed in the interstices within the coating itself, but the fact that the gap protection layer develops initially by the galvanic action, but then that particular coating remains intact and provides protection long after any drivers have disappeared. Q. That was surprising, but it was known by 1992 that that is how zinc worked? A. And that is the key nature of why zinc works. So before you would even contemplate anything else, you would want to be assured that anything you do maintains that protection. There is no point in having a better coating in the sense that it lasts intact for a longer period and then all protection is then instantly evaporated. What you are looking for is a situation which is described mainly in the steel and concrete industry; as the time to imitation of corrosion, then development of the corrosion thereafter, until you reach the failure state. What the black coating does, you have the zinc remains for a particular period where, essentially, no corrosion of the substrate occurs, then the zinc salts remain behind, which then provide protection. I am not necessarily saying that is zero corrosion occurring. It is providing protection thereafter, so it is corroding at a slowish rate. If you had a situation where you were putting and you modified that metallic coating so it lasted longer, this is fine for your period to initiation; but if then there was no ongoing protection, your end life, your total engineering life of the product, would be nowhere near as strong. That, as far as I understand it, is the key feature, which is what is being – it is the long-term, the 80 years-plus, life which is what has been aimed at.” What you are looking for is a situation which is described mainly in the steel and concrete industry; as the time to imitation of corrosion, then development of the corrosion thereafter, until you reach the failure state. What the black coating does, you have the zinc remains for a particular period where, essentially, no corrosion of the substrate occurs, then the zinc salts remain behind, which then provide protection. I am not necessarily saying that is zero corrosion occurring. It is providing protection thereafter, so it is corroding at a slowish rate. If you had a situation where you were putting and you modified that metallic coating so it lasted longer, this is fine for your period to initiation; but if then there was no ongoing protection, your end life, your total engineering life of the product, would be nowhere near as strong. That, as far as I understand it, is the key feature, which is what is being – it is the long-term, the 80 years-plus, life which is what has been aimed at.”[35]None of this to my mind remotely makes the idea of using Zn/Al alloy for pipes obvious – as something which is simply self-evident to the unimaginative man skilled in the art. Mere possible inclusion of something within a research programme on the basis you will find out more and something might turn up is not enough. If it were otherwise there would be few inventions that were patentable. The only research which would be worthwhile (because of the prospect of protection) would be into areas totally devoid of prospect. The “obvious to try” test really only works where it is more-or-less self-evident that what is being tested ought to work.[36]In the end, therefore I think this is a case where, in the round, the Judge formed a view on obviousness and it is not shown he made a true error of principle. Moreover even if the matter were free from the Biogen principle, I would have come to the same conclusion: Johnsson simply did not give an unimaginative skilled man concerned with long-term corrosion in pipes sufficient pointer that Zn/Al would or might work to provide protection by corrosion products.[37]I would only add this, that I do not accept the general premise underlying Mr Wyand’s attack – namely that the Court of Appeal can apply the Biogen principle in a bitty sort of way to parts of the reasoning leading to the ultimate conclusion on obviousness, that one can identify one error of principle but leave other parts of the reasoning subject to Biogen. If an error of principle in an overall conclusion of obviousness is identified, then that very conclusion as a whole is open for reconsideration by the Court of Appeal. The whole point of Biogen is that the Judge has reached his overall conclusion by evaluating all the evidence and that he can only give “an incomplete statement of the impression which was made upon him by the primary evidence.”[38]I would therefore dismiss this appeal. I part from this case only to express my puzzlement and disappointment about the papers. We looked at some parts of 4 files. Provided for us were a further 8. These were never opened. What they were for was never explained. Those concerned with their preparation may consider that their clients ought not to be charged for them.[39]I agree[40]I also agree.

ORDER

Appeal dismissed; the appellant to pay the respondent’s costs of the appeal (including the respondent’s notice) to be the subject of detailed assessment if not agreed; permission to appeal to the House of Lords refused. (Order does not form part of approved Judgment)

Cited in 17 later judgments

and 8 more of the most senior