UK online grocery delivery firm Ocado (OCDO) won a major victory in a patent infringement battle with Norwegian robot maker AutoStore, prompting its shares to jumped nearly 10% on 14 December.

This helped to make up for disappointing fourth quarter trading figures from its joint venture with Marks & Spencer (MKS).

The legal case started last year when AutoStore said it would sue Ocado for infringing its technology patents and would ask the court to ban imports of Ocado robots into the US.

Ocado uses robots in its warehouses to pick customer orders, a critical part of its solutions platform which it has licenced to US grocery firm Kroger and others around the world.

The UK firm launched a countersuit against AutoStore claiming the latter had infringed its intellectual property rights with regards to both its new Blackline robots and its Router operating software.

The International Trade Commission ruled that three of the four AutoStore patents were invalid and a fourth hadn’t been infringed, while AutoStore dropped its fifth patent claim the night before the trial.

‘Autostore is set to appeal the judgement, with a finding due in April, but this looks like a fairly comprehensive ruling in favour of Ocado, setting a precedent not only for the ITC’s final findings, but also similar action being played out in the US district court and UK high court,’ say analysts at Numis.

‘Together, whilst not definitive across all cases, we see the court verdict as a crucial step in rebuilding investor confidence in the long-term outlook for the business.’

Shares in Ocado have drifted downwards this year after slow progress with winning new customers for its robotics technology, despite the pandemic emphasising the importance for grocery providers to have robust sorting and packing services for online orders. This backdrop should in theory have played to Ocado’s strengths and driven more business. The legal battle with AutoStore has also weighed on investor sentiment.

For its UK retail joint venture with Marks & Spencer, revenues for the three months to November were down nearly 4% to £548 million against a market forecast of £600 million.

Sales growth was also held back by a shortage of staff, particularly at the start of the quarter in the logistics business, while Ocado also flagged cost inflation due to rising energy prices.

Customer acquisition has been strong with almost a million people now signed up, and sales of Marks & Spencer products through the system continue to grow, reaching nearly 30% of the average basket.

Ocado expects its ‘best-ever Christmas’ and a return to mid-teens percentage revenue growth in 2022 thanks to new sites opened during this year.

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