Patent owners must tread carefully when asserting their rights against potential infringers or risk legal backlash themselves. This principle was reinforced by the recent UK Court of Appeal decision in The NOCO Company v. Shenzhen Carku Technology Co., Ltd., which provided new guidance on what communications can constitute actionable “threats” of patent infringement under UK law.

The core issue was whether notifications NOCO sent to Amazon through its “Infringement Form,” alleging that certain product listings by Carku infringed NOCO’s patent and requesting removal, crossed the line into unlawful threats. Both the High Court and Court of Appeal found that NOCO’s communications did indeed amount to unjustified threats of infringement proceedings.

What constitutes a legal “threat”?

Under UK law, making groundless threats of patent infringement proceedings to a party that is not itself a primary infringer (for a product this is usually the manufacturer or importer) can expose a party asserting rights in a patent to liability. The key provisions were summarized by the Court, a communication amounts to an actionable threat if:

1) The recipient would understand that the sender intends to bring infringement proceedings against another party (not necessarily the recipient).

2) The alleged infringement does not actually constitute infringement (“unjustified” threat).

3) It is not just a permitted factual statement setting out patent ownership but actually requests cessation of commercial activities related to the accused product.

Notably, the Courts confirmed that threats made to a third party like Amazon in an attempt to disrupt the accused infringer’s business can create liability, even if the third party would not itself be a defendant in any infringement case.

Lessons for using Amazon’s infringement notification system

Applying these principles, the Court found that NOCO’s inclusion of explicit requests to “remove these listings” on the Amazon Infringement Form, combined with the allegations of patent infringement, would be understood by a reasonable recipient as an implicit threat of litigation if the request was not complied with.

The Court distinguished NOCO’s approach from simply providing factual notification of a believed intellectual property right through the Form, which likely would not constitute a threat. But NOCO went further by directly urging Amazon to take specific actions against the listings.

This contrasts with a previous case (Quads 4 Kids v. Campbell) involving eBay’s infringement reporting system. There, merely checking boxes stating a good faith belief the listings were infringing, without any request for eBay to act, was found not to be a threat.

The Court recognised this could mean any use of Amazon’s “Additional Information” field on the Infringement Form risks turning the communication into a threat. But it left open the possibility that carefully crafted notifications solely providing factual product details and statements of belief, without any explicit requests for action, may still be permissible.

Justifying threats and mitigating risk

There is an exception where threats would be “justified” because the accused acts do infringe the asserted patent. However, this defence failed for NOCO because its patent was ultimately invalidated.

More broadly, the Court’s ruling serves as a reminder that patent owners must exercise great caution whenever asserting infringement concerns against third parties like online marketplaces, retailers, suppliers, etc. Strongly worded demands to cease commercial activities could be viewed as unjustified threats if the patent is later ruled invalid or not infringed.

To reduce risk, patentees should always seek professional advice before attempting to assert their patent rights.  Thought can then be given as to how to proceed whist minimising or eliminating, creating a potential liability through making an actionable unjustified threat.

Additionally, if you are accused of infringing a third-party patent, always consult a professional in the first instance.  This will ensure that the threat is handled correctly to secure the best commercial outcome for your business.

Conclusion

The NOCO case serves as a useful illustration of where a patent owner’s zeal in asserting its rights may have gone too far. Ultimately, strategic and qualified use of language, coupled with legal oversight, is highly recommended whenever raising infringement concerns – particularly with third parties that are not themselves the primary accused infringer.

If you need any advice on handling or making threats of patent infringement, please get in touch to speak to one of our attorneys.