Can a foreign bank use the doctrine of sovereign immunity to avoid patent protection?

A LTD v B BANK and BANK of X

Author: David Rickard, Partner, Boult Wade Tennant.

Court of Appeal
Leggatt L.J.; Morritt L.J.; Brooke L.J;

In a rare venture for IP lawyers into the world of International Law, this case considers the question of jurisdictional limits on the Courts' power to enforce patents where alleged sovereign rights are involved.

Identities of Parties
In a preliminary application, the Defendant/Respondent and Intervener applied for an Order that the parties and the currency concerned not be identified. Whilst A Ltd did not consider that there was any reason for such an Order, they did not take a position on it. In the result, the Court granted the Order pursuant to the inherent jurisdiction of the Court and S.11 of the Contempt of Court Act.

Background
A Ltd is the proprietor of a United Kingdom patent relating to an invention of a type of security paper generally used in the manufacture of bank notes. The invention relates to a security device (comprising at least two distinct security features) which is to be inserted into bank notes, amongst other things to assist in detecting counterfeit notes.

The defendant, B Bank, is a commercial bank from a country outside the UK which has branches in and trades in the UK. It kept for disposal, and disposed of, bank notes which were alleged to infringe A Ltd's patent.

The Bank of X intervened in the proceedings. X is a foreign country, and the Bank of X the central bank of that foreign country. The Bank of X had security paper manufactured for it in Italy and produced bank notes from it of several denominations. However, not all denominations were printed on this paper. The Bank of X issued as that country's currency these bank notes. This paper and the bank notes printed thereon, when dealt with in the UK, were alleged to infringe A Ltd's patent. The Bank of X could possibly have printed bank notes on non-infringing paper for circulation in the UK. B Bank and Bank of X submitted that A Ltd was seeking to challenge the disposal within the United Kingdom of bank notes being the currency of the State of X put into circulation in the United Kingdom and elsewhere by X.

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