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Mayer Brown overturns Court of Appeal patent decision on telephone calling cards in landmark case (Aerotel v WaveCrest)

21 May 2008
21 May 2008 – Leading international law firm Mayer Brown has successfully revoked in High Court proceedings a long standing patent for pre-paid telephone calling cards. The cards allow users to make telephone calls from virtually any telephone in the world and charge the costs of the call to the card.

The High Court decision has been awaited with much interest and is particularly notable for two reasons. Firstly in order to successfully revoke the patent, it was necessary to overcome a leading decision by the Court of Appeal which reinstated the patent after an earlier challenge in the High Court – a very rare event, since the High Court generally has to abide by Court of Appeal decisions. Secondly, among the grounds on which the patent was revoked was that the underlying invention was simply for a business method (and only required the writing of computer software to put the invention into effect), both of which are excluded from patentability in Europe. This is the first time a UK patent has been revoked on this basis.

Mayer Brown, led by partner Ian Wood, represented WaveCrest, a global communications service provider, who were accused by Israeli organisation Aerotel of infringing their telephone calling card patent.

WaveCrest is one of the largest private wholesale carrier businesses, and amongst the largest wholesale voice carriers in Europe. Their retail division is a UK market leader in pre-paid calling card distribution. Its range of products includes First National, Go Bananas, Mad For Minutes and Mega Mouth.

Ian Wood, IP Partner at Mayer Brown, said:
“The impact would have been enormous if we had lost this case, as many millions of pounds would have been payable in royalties on telephone calling cards. We were able to successfully argue that the Court of Appeal’s factual understanding was wrong and therefore that they had come to the wrong conclusion in reinstating the patent. To overturn a Court of Appeal decision is really unusual and furthermore is the first time a UK patent has been revoked on the basis that it is only for a business method.”

Background to the case:

Shortly after Aerotel accused WaveCrest of infringing their patent, they also sued telecommunications company Telco, who applied for Summary Judgement of the case. This resulted in Aerotel’s patent being revoked. However, Aerotel took the case to the Court of Appeal, who ruled the Summary Judgement was wrong and reinstated the patent. Telco decided to settle, leaving Mayer Brown to take WaveCrest’s case forward, resulting in the revocation of the patent.

This is the latest example of the leading patent cases with which Mayer Brown have been involved.

For further information:

Ian Wood
Mayer Brown, London
+ 44 (0)20 7782 8897

Charlotte Ward
PR Manager
Mayer Brown, London
+44 (0)20 7782 8547

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