Right to Continue Use Begun Before the Priority Date
Section 64 of the Patents Act 1977 gives third parties a right to continue acts which would otherwise infringe a patent, if those acts were begun before the priority date.
This is a relatively new provision in the UK which is intended to bring the law into line with the rest of Europe. Previously, prior secret use of an invention invalidated a later patent, but under current law the patent remains valid and enforceable against parties who cannot benefit from the Section.
The rights provided by this Section also extend to cases where "effective and serious" preparations were made to carry out such acts, but the acts themselves were not actually begun before the priority date.
The rights are not subject to any kind of formal notification or registration requirement, and they are merely asserted in defence to any allegation of infringement. The onus of proof always lies with the person claiming such rights.
Such third party rights are not limited to individuals, and they may benefit partnerships and corporate bodies.
Subsection (3) confers an implied licence on anyone acquiring products disposed of in exercise of such rights.
Exceptions and Limitations
The rights provided for by Section 64 are subject to a number of important restrictions.
The prior acts (or preparations) must have been done in "good faith". This is a common English legal term and is generally understood to exclude acts done on the basis of information originating from the inventor and performed without consent. There is, however, an implication that, to fall within the exclusion, the prior user must have knowledge that the acts should not be done, and "innocent" acts or preparations may benefit from the provisions of Section 64 regardless of circumstances.
The rights under Section 64 are, in general, personal to the party concerned, and they cannot be licensed to another party. However, if the acts or preparations were made in the course of a business, the rights can be passed on in conjunction with the business. It is probably not necessary for the third party rights to be explicitly transferred provided a genuine and effective transfer of the business has occurred.
The acts or preparations in question must have been done inside the United Kingdom. Even prior secret use in another EU country does not fall within the scope of this section, and although a prior user might have a similar right to continue use in another country the acts cannot automatically be extended to the United Kingdom. It has been suggested that this territorial limitation may be unenforceable within the EU, constituting a restriction on trade between member states, but at present this question remains unresolved.
The phrase "effective and serious preparations" seems to require more than a mere intention to perform an act, and it appears that the preparations must be physical and enabling. In one of the few cases to be considered under this Section, it was held by the Court of Appeal in Lubrizol -v- Esso  RPC 727, that although serious preparations were made before the priority date to manufacture a product in the United Kingdom they had not been "effective".
© Craske & Co., 2008
Last updated: 27 December 2010