The relevance of EPO decisions to Singapore

26 October 2012

Karol Goh

Main-Line Corporate Holdings Ltd vs DBS Bank Ltd

Main-Line Corporate Holdings Ltd (Main-Line) is the owner of a patented method and system registered in Singapore on 30 June 2003, that automatically determines the operating currency in which to process a transaction for a credit card, charge card or debit card at the point of sale between a merchant and the cardholder, without the need for any manual selection or intervention by the merchant and/or the cardholder to identify the card’s currency (the Patent).

Main-Line claimed that DBS Bank Ltd (DBS) had infringed the Patent, through the use of an automatic currency detection service (Monex System) provided by E-Clearing Singapore Pte Ltd.

Prior to this case, Main-Line brought an action for infringement against United Overseas Bank Ltd (UOB) and First Currency Choice, UOB’s service provider (UOB case). In the UOB case, the defendants denied infringement and counterclaimed for revocation of the Patent. Both the High Court (the court of first instance) and Court of Appeal (the highest and court of final appeal) found that the Patent was novel and involved an inventive step, and dismissed the defendants’ argument on the issue of insufficient disclosure.  Both courts also found that the case for infringement was made out.

In the present case, which was heard before the High Court, one of the arguments made by DBS was that the Patent was invalid because of the European Patent Office’s (EPO) recent invalidation of Main-Line’s corresponding European patent. DBS submitted that in light of the EPO’s decision, the court was entitled to revisit the issue of Patent’s validity, despite the decisions of the High Court and the Court of Appeal in the UOB case.

The court considered the question of whether it was bound by the decision of the Court of Appeal in the UOB case in light of the recent EPO decision, and, if so, to what extent. The court found that it was not free to depart from the decision of the Court of Appeal, especially since Singapore, not being part of the European Patent Convention (EPC), was under a different legal and regulatory regime for patents, and thus in certain areas may apply different legal principles.

The court also observed that even in the UK, which was party to the EPC, it was acknowledged that national courts may come to different conclusions from the European Patent Office (EPO) in essentially the same matters, despite the fact that the English courts strived for consistency with the EPO in matters of principle. Lower instance courts in the UK also continued to be bound by decisions of the House of Lords (now the UK Supreme Court), regardless of any EPO decision.

After confirming that the Patent was valid, the court concluded that DBS had infringed the Patent, as the Monex System functioned in a manner equivalent to the essential integers of the Patent. The court found that since DBS knew about the Patent prior to the alleged infringing act and had benefited from transactions using the Monex System, DBS was liable for infringement of the Patent.