Non-Infringement Declarations only for Patentees.

The decision of Dowsett J in Occupational and Medical Innovations Ltd ACN 091 192 871 v Retractable Technologies Inc [2008] FCA 1102, has highlight an apparently significant restriction in the operation of section 125 of the Patents Act.

Section 125 allows a person to apply to a Court for a declaration that the exploitation of an invention would not infringe a claim of a particular complete specification. Section 126 imposes certain preconditions on the making of such an application, including that the Court:

must not make a non-infringement declaration unless a patent has been granted in respect of the relevant invention

Dowsett J held that:

The applicant will be entitled to apply under s 125 if he or she wishes lawfully to exploit the relevant invention. However subs 126(1) provides that no declaration may be made unless and until a patent has been granted for the invention. In my view the patent referred to in subs 126(1) and para 126(1)(c) is that which relates to the invention which the applicant proposes to exploit.

Accordingly, only a patentee wishing to exploit their invention, which falls within the scope of the claims of their patent, may apply to the Court for such a declaration.

AusPat upgraded

IP Australia has implemented additional functionality to its patent search system, AusPat.

Details of the changes are available on AusPat's home page.

Evidence in Opposition Not Evidence on Appeal

The decision of Jessup J in Sherman v Commissioner of Patents [2008] FCA 1026 concerns an appeal from a patent opposition, the Commissioner being a party as a result of the withdrawal of the original opponent. The Commissioner had filed an affidavit exhibiting a citation relied upon for the finding that the claims lacked novelty and inventive step as well as the declaratory evidence filed during the opposition. Sherman, the patent applicant, objected to the admission into evidence of certain aspects of that affidavit, on the basis that they did not satisfy the requirements of the Evidence Act 1995 (Cth).

The Commissioner submitted to the Court that while an appeal from an opposition was a hearing de novo, all material before the Commissioner on the opposition was permitted to be tendered as evidence regardless of restrictions which might otherwise be imposed by the Evidence Act.

Jessup J rejected this contention concluding that a patent opposition appeal proceeding was:

a conventional one in the original jurisdiction of the court, in which the questions which were before the delegate are again in controversy, and must be decided on the evidence that is tendered and admitted here. The admission of that evidence is, in my view, regulated by the Evidence Act in the normal way.

Accordingly, his Honour upheld Sherman’s objections, finding inter alia that the declarations filed during the opposition were inadmissible as hearsay.

IP Australia Recognised as an International Search Authority by the USPTO

IP Australia and the United States’ Patent and Trademark Office (USPTO) have announced an agreement that will see IP Australia act as an international search and examination authority for international applications filed with the USPTO under the Patent Cooperation Treaty (PCT).

US PCT applicants can now choose IP Australia to undertake their initial search and examination.

IP Australia is already an international search and examination authority for 17 countries including the Republic of Korea, New Zealand, Singapore, India and Malaysia.

Patentable subject matter Issues Paper released for comment

The Advisory Council on Intellectual Property is conducting a review of what types of subject matters should be able to be patented in Australia and whether the law is meeting the country’s needs. It has released an Issues Paper requests that written responses to the questions in the paper and any other comments be submitted by 19 September 2008.

Onus in Pre-grant Oppositions thrown into doubt

In the decision of the Full Federal Court of Australia in IGT (Australia) Pty Ltd v Aristocrat Technologies Australia Ltd [2008] FCAFC 131 Justice Gyles has thrown doubt on the correctness of the approach adopted by the Commissioner and the Federal Court on appeal under section 60(4) with respect to the Opponent's onus in pre-grant oppositions. For a number of years the authorities have drawn a distinction between opposition and revocation proceedings. The judge at first instance summarized the distinction as follows (Aristocrat Technologies (2007) 239 ALR 181, (2007) 71 IPR 259 at [11]):
“whether it can be concluded clearly or as a matter of practical certainty that the opposition is well made and that the patent, if granted, would be bad, … the issue for resolution by the court is not whether the matters grounding the opposition (here want of novelty and obviousness) have been made out in the manner required in revocation proceedings.” (Original emphasis.)

On appeal Justice Gyles questioned the correctness of this approach. Whilst his Honour accepted that the parties had agreed upon the formulation of the issue as enunciated by the judge at first instance, Gyles J observed that this approach could not be reconciled with the provisions of ss 49, 60, 158 and 160 of the Patents Act 1990 (cf Imperial Chemical Industries Pty Ltd v Commissioner of Patents (2004) 213 ALR 399 per Crennan J at [49]–[53]).

It will now be very interesting to see whether Justice Gyles' views get a chance to be tested at a later time.

Mere importation is trade mark infringement

Gyles J in Gillette Company v Schiavini [2008] FCA 1053 has confirmed the longstanding view that mere importation is use as a trade mark such as to constitute an infringement of a trade mark proprietor's rights.

New Zealand Patents Bill

The long awaited New Zealand Patents Bill having key provisions substantially modeled on the Australian Patents Act has been introduced into the New Zealand Parliament. It is expected that the first reading of the Bill and referral to the Select Committee should occur within the next few months. Once the Bill has been referred to the Committee, submissions will be invited. At this stage it is not possible to predict when the Bill will be enacted but it is unlikely to come into force before late 2009.

Evidence in Opposition Not Evidence on Appeal

The decision of Jessup J in Sherman v Commissioner of Patents [2008] FCA 1026 concerns an appeal from a patent opposition, the Commissioner being a party as a result of the withdrawal of the original opponent. The Commissioner had filed an affidavit exhibiting a citation relied upon for the finding that the claims lacked novelty and inventive step as well as the declaratory evidence filed during the opposition. Sherman, the patent applicant, objected to the admission into evidence of certain aspects of that affidavit, on the basis that they did not satisfy the requirements of the Evidence Act 1995 (Cth).

The Commissioner submitted to the Court that while an appeal from an opposition was a hearing de novo, all material before the Commissioner on the opposition was permitted to be tendered as evidence regardless of restrictions which might otherwise be imposed by the Evidence Act.

Jessup J rejected this contention concluding that a patent opposition appeal proceeding was:

a conventional one in the original jurisdiction of the court, in which the questions which were before the delegate are again in controversy, and must be decided on the evidence that is tendered and admitted here. The admission of that evidence is, in my view, regulated by the Evidence Act in the normal way.

Accordingly, his Honour upheld Sherman’s objections, finding inter alia that the declarations filed during the opposition were inadmissible as hearsay.

Copying tests lands teacher in trouble

In Boyapati v Rockefeller Management Corporation [2008] FCA 995, Kenny J considered, amongst other causes of action, a claim for infringement of copyright in a series of tests designed to prepare candidates for the Undergraduate Medicine & Health Sciences Admission Test (“UMAT”).

There was little doubt that the respondent, also engaged in the business of preparing students for the UMAT, had reproduced the applicants' tests and most consideration was directed to whether the tests were sufficiently original for copyright to subsist. Of the 800 questions forming the various tests, there was evidence to the effect that while half where written from scratch, the other half where developed from existing questions compiled from various sources. After reviewing a number of authorities on originality in compilations, her Honour concluded that:

Whilst the evidence established that she [the second applicant] derived the balance of the questions and answers from third party sources, she used these sources in different ways, selecting, adapting and modifying them to varying degrees to suit her purpose of compiling sets of practice exams that simulated the UMAT. Even where she made minimal modification to a pre-existing question, she exercised skill and judgment in selecting the question and including it in either section 1 or 2, depending on whether it concerned logical reasoning or interaction skills. There was also a degree of skill and judgment involved in organising the sequence and, to a lesser extent, the number of questions in sections 1 and 2 so as to simulate the UMAT. The practice exams that she created were therefore a product of her skill, judgment and labour, combined with that of Ray and Edward Boyapati to the extent that they contributed to the process. The skill, judgment and labour involved were sufficiently substantial to attract copyright.

In addition to finding that the respondent had infringed copyright, her Honour also held that the applicants should succeed in their claim for conversion under s 116 of the Copyright Act. The Court made orders that the parties file further submissions in relation to the appropriate relief, both for the conversion and copyright infringement, including whether additional damages should be awarded.

Limited time to initiate infringement proceedings after Customs seizure

Jemella Australia Pty Ltd v MacKinnon [2008] FCA 1022 relates to a Customs seizure and an application for an extension of time under section 137 of the Trade Marks Act. It appears that the 10 day period for instituting infringement proceedings is rigid and that if any extension is sought it must be applied for and granted within the 10-day period.

At paragraph 22 Logan J states: "There are, therefore, readily identifiable and potentially conflicting commercial purposes which are resolved by the Parliamentary value judgment that I have mentioned. The time that is specified prime facie is quite short. It seems to me that that time represents Parliament’s view of a reasonable proportionality between potentially conflicting commercial interests. In those circumstances it seems to me unlikely that Parliament envisaged that there would be any ability for there to be what one might term “slippage” in the time limit prima facie specified in s 137(1). The language of s 137(1) also tends to reinforce that particular impression gleaned from evident purposes in the statute. Sackville J was plainly of the view that the language of s 137(1) had that quality."

IP Scorecard

The Australian Department of Innovation, Industry, Science and Research has released a 6-page analysis of registrable IP rights (particularly patents and trade marks) for the period from 2002 to 2006. The Scorecard looks at Australian applications and foreign applications by Australians (particularly in the US and Europe) . It is available as a PDF here.

Narrow Waisted Yes. Narrower Claim No.

In a further instalment of the long running dispute over multi-hulled vessels between Stena and Austal Ships, 3 July 2008 saw the Full Court of the Federal Court hand down its decision in Austal Ships Sales Pty Ltd v Stena Rederi Aktiebolag [2008] FCAFC 121.

At first instance, Tamberlin J held one of Austal’s vessels to be an infringement of Stena’s patent, while rejecting Austal’s cross-claim for revocation. On appeal, Austal sought to overturn the first instance finding that the patent was not bad for lack of clarity as well as the decision on infringement.

On the question of clarity, it was argued that the terms “substantial portion” and “narrow waisted”, appearing in claim 1, were sufficiently imprecise as to render the claims lacking in clarity. Having regard to the nature of the invention the claims sought to define, and the evidence of experts led by the parties the Court concluded that the claims were clear, concluding, with reference to Martin v Scribal Pty Ltd (1954) 92 CLR 17, that:

Austal’s argument fails to take account of the fact that, as in Martin, Stena’s invention involved an idea which “involves a matter of degree and for that reason any distinction that is precise must be but an arbitrary restriction on the inherent variability of the feature…”

On the question of infringement, the appeal was also dismissed. The Court held that the Austal 94 hull did not fall within the scope of claim 1 because that claim required that the width of the hull continually decrease in the forward direction, whereas the width of the Austal 94 hull actually increased slightly over the first 10% of its length. Curiously however the Court held that the Austal 94 hull did fall within the scope of claim 7, which was dependent on claim 1, but further required that the width of the hull be substantially constant in the sternward quarter of the vessel. Despite claim 1 being incorporated by reference into claim 7, the Court considered that the two requirements as to width were “true alternatives” stating that:

There is no requirement of patent law that subsequent claims narrow the scope of earlier claims, even though, as a matter of practice, this is often the case.

Two New Zealand trade mark opposition decisions reviewed

Phillips Ormonde & Fitzpatrick has reviewed two recent New Zealand trade mark oppositions. The are (click on the name to see the article):
Trade Mark Application No 749687 (SILVER FERN in class 14) in the name of New Zealand Mint Limited -and- Opposition by New Zealand Post Limited (T15/2008)
and
Trade Mark Application No 742904 (MONSTER ENERGY in class 32) in the name of Bickford's Australia Pty Ltd -and- Opposition by Hansen Beverage Company

New requirements for Australian patent and trade mark attorneys

New regulations have come into force that change the pre-registration requirements for patent attorneys with a focus on a more skills-based approach. It will be necessary to demonstrate two years appropriate employment experience.

Registered patent and trade marks attorneys now need to undertake compulsory continuing professional development activities each year.

Putting Your Best Foot Forward

The decision of Gordon J in Edwards v Liquid Engineering 2003 Pty Ltd [2008] FCA 970 provides an illustration of the need consider more than cost in developing a dispute resolution strategy.

In 2003, Edwards had obtained registration, in his own name, of two trade marks used by his then employer (who subsequently assigned its intellectual property rights to Liquid Engineering).

Liquid Engineering’s application for removal under section 92, alleging that Edwards did not intend, and had not used the trade marks in good faith, was allowed by the delegate of the Registrar of Trade Marks. Edwards appeal that decision.

Gordon J, minded to allow the appeal “on the basis that “good faith” for the purposes of s 92(4) requires no more than genuine intent to use a mark for commercial purposes; it does not involve any element of honesty or subjective good intentions” nevertheless delayed giving judgement in the appeal to allow Liquid Engineering to bring an application before the Court under section 88 on the basis that Edwards was not the owner of the trade marks, which her Honour, having heard the evidence, apprehended was the more appropriate means of dealing with the dispute.

Ultimately, it was determined that the trade marks were held by Edwards on trust for Liquid Engineering and Gordon J directed that the register of trade marks be amended to record Liquid Engineering as the true owner. However, despite Liquid Engineering’s argument that the initial section 92 action before the Trade Marks Office was appropriate as a lower cost alternative to Court proceedings, her Honour ordered that Liquid Engineering pay Edwards costs of the appeal, stating that:

“Parties should not be encouraged to bring inapposite claims on the grounds that they are cheaper; such a strategy may, as this case shows, backfire and if that occurs, it will result in more costs being incurred than if the best claim was brought in the first place.”