Australian confirmed as WIPO head

Dr Francis Gurry has been confirmed as Director General of the World Intellectual Property Organization (WIPO).

Dr Gurry is now the most senior Australian in the United Nations system; the first Australian to head a United Nations specialised agency since 1992, and only the third Australian to do so

Patent Office Flies the Flag for “Clear and Unmistakeable Disclosure”

The decision of the Delegate of the Commissioner of Patents in Cadbury Schweppes Pty Ltd v Wm. Wrigley Jr Company [2008] APO 20 provides an interesting counterpoint to the decision of Gyles J in Apotex v Sanofi-Aventis.

The claims of the opposed application related to a method of coating comestibles (principally chewing gum), which included the application of a suspension coating syrup, (a “suspension coating method”) rather than a solution coating syrup, (a “solution coating method”). Each of the suspension and solution coating methods were know to have various advantages and disadvantages.

Under the ground of novelty, the Opponent relied, inter alia, on two documents identified as DA3 and DA8, which were technical application sheets produced by the manufacture of the sugar derivative Isomalt used to produce the coating syrup. In assessing whether these documents anticipated the claims of the application, the Delegate noted that:

Both documents have very specific directions about how to make a suspension of Isomalt ST in an Isomalt GS solution. However, there is little detail of how this suspension is then used in a coating process in either document apart from a table outlining general process parameters ... Without such detail, it is not clear that either DA3 and DA8 contains sufficient information to meet the Hill v Evans [supra] test of being the same as the claimed invention for the purposes of “practical utility”.

The Delegate considered whether, assuming the skilled worker could supply the missing detail, the documents otherwise anticipate the claims. It was noted that while each of the documents were individual recipes, they formed part of a larger technical document supplied by the manufacture to its customers. In the Delegates view:

Being part of a larger collection of recipes, DA3 and DA8 have to be read in the context of all the other technical application sheets because considering them in isolation might be seen as rummaging through the prior art’s "flag locker" to pull out the relevant “flag” (against the teaching of ICI Chemicals v Lubrizol Corp [supra]).

In this regard, while DA3 and DA8 both outline the suspension method, another Palatinit technical application sheet (Technical Application sheet 3.5.2b) describes an alternative method (the solution method).

The Delegate considered that having regard to the entire collection of technical application sheets, at the relevant date “the manufacturer was not necessarily recommending the suspension method to their clients”, concluding that:

Against this background unless there was a clear direction in the citation (or from the common general knowledge) to explain why a method was particularly advantageous, I am not convinced that there are clear and unmistakeable directions for the skilled worker to use the exact method outlined in DA3 or DA8.

Giving Goliath the Slingshot

It seems that the Federal Court is not the only one to take issue with the current conduct of IP litigation in Australia. The report of the Review of the National Innovation System “venturousaustralia - building strength in innovation” includes a section headed “The costs of enforcing IP rights”. The report's solution to the perceived problem of such costs takes the form of Recommendation 7.4 that “Firms asserting or defending intellectual property should have a right to opt out of ‘appellate double jeopardy’.”

The proposal effectively provides that any party may elect not to appeal the first instance decision unless it funds the costs of both itself and the other parties in doing so. If any party makes such an election, all parties would be bound by it. How this proposal is intended to “level the playing field ... between large and small firms” is unclear, given that such an election would effectively mean that only large firms (having sufficient funds) could appeal an unfavourable decision.

Federal Court’s Flu Shot for Patent Law

Over 100 years ago Lord Esher, in Ungar v Sugg (1892) 9 RPC 113, opined:

that a man had better have his patent infringed, or have anything happen to him in this world, short of losing all his family by influenza, than have a dispute about a patent. His patent is swallowed up, and he is ruined. Whose fault is it? It is really not the fault of the law; it is the fault of the mode of conducting the law in a patent case. This is what causes all this mischief.

Today it seems little has changed, at least in the minds of the Judges of the Federal Court who have set out to change the way Patent litigation is conducted in Australia.

Following a somewhat informal release back in June, the Victorian and New South Wales district registries of the Federal Court have each now officially released a “Notice to Practitioners - Proceedings under the Patents Act 1990 (Cth)” outlining new procedures for proceedings under that Act.

The procedures are stated to be “deliberately not overly prescriptive, with an emphasis on flexibility of application to each proceeding” and are clearly aimed at narrowing the issues in dispute as early as possible. The specific matters addressed include:

• Ground of Invalidity: Particulars of invalidity are to include details of the passages of any prior publication relied upon for novelty purposes and after filing of the particulars, the party seeking revocation must explain how each ground of invalidity can be supported.
• Expert Evidence: The Court will enquire whether any expert evidence will be required, whether a single expert is appropriate for all or any part of the evidence, whether any of the evidence can be given orally or by reference to standard texts, or by a combination of summary outline and oral evidence, whether a primer is appropriate and as to the appropriate method of evidence. The last matter may include whether there should be prior meetings of experts to explain or narrow the issues in dispute


• Discovery: Before discovery is ordered, the parties must confer to discuss the issues to be addressed by discovery and the nature of the documents sought, and whether evidence should precede discovery

The procedure also provides for procedural mediation or case management conferences to try and narrow the issues in dispute and resolve interlocutory matters.

These procedures will hopefully play an important role in streamlining the conduct of certain patent disputes and may provide SME’s with the prospect of being able to enforce their patents without significant expense. However already this year the Federal Court has handed down patent decisions in relation to the pharmaceuticals Liptor and Plavix, which had global sales of USD13.5 billion and USD7.3 billion respectively in 2007. Where the monopoly rights conferred by a patent are of sufficient value, it is likely that litigants will still wish to fight every point and the procedures may have a limited impact.

Historic agreement between Australia & Korea

IP Australia reports that an agreement has been reached with the Korean IP Office relating to the PCT International Search Authority and International Preliminary Examination Authority

So what's the difference?

The first serious consideration of section 7(4) of the Patents Act 1990 relating to innovative step, the decision of Gyles J in Delnorth Pty Ltd v Dura-Post (Aust) Pty Ltd [2008] FCA 1225, gives a somewhat unexpected interpretation of the phrase “substantial contribution to the working of the invention”.

Gyles J commences with a concise explanation of the approach to be taken in assessing innovative step, consistent with recent approaches to the question of inventive step, noting that:

There is no need to search for some particular advance in the art to be described as an innovative step which governs the consideration of each claim. The first step is to compare the invention as claimed in each claim with the prior art base and determine the difference or differences. The next step is to look at those differences through the eyes of a person skilled in the relevant art in the light of common general knowledge as it existed in Australia before the priority date of the relevant claim and ask whether the invention as claimed only varies from the kinds of information set out in s 7(5) in ways that make no substantial contribution to the working of the invention. It may be that there is a feature of each claim which differs from the prior art base and that could be described as the main difference in each case but that need not be so. Section 7(4), in effect, deems a difference between the invention as claimed and the prior art base as an innovative step unless the conclusion which is set out can be reached.

His Honour then considered the background to the introduction of innovation patents, including the High Court decision in Griffin v Isaacs from which the phrase “substantial contribution to the working of the invention” is derived, concluding that

The focus is upon working of the invention (as claimed) not to the degree or kind of variation from the kinds of information set out in s 7(5). In other words, the variation from the kinds of information might be slight but, if a substantial contribution is made to the working of the invention, then there is an innovative step.

The judgement then turns to the presence or absence of innovative step in this particular instance, with Gyles J noting at [63] that:

As I have endeavoured to explain, the question is not whether flexible sheet steel is better than flexible PVC – it is certainly different. It cannot be seriously argued that the material sheet spring steel does not make a substantial contribution to the working of the roadside post claimed in each claim

And again at [78]:

The different material contributes substantially to the manner in which that invention as claimed performs. As I have said earlier, it is not a question as to whether these claims are better than the disclosure by Kennedy, or whether it was obvious to move from Kennedy to this invention. Therefore, there is an innovative step over Kennedy.

Accordingly, the test applied by Gyles J appears to be whether the feature, which varies from the prior art, in and of itself makes a substantial contribution to the working of the invention, rather than whether the nature of the variation, the extent to which that feature differs from the prior art, makes such a contribution. Indeed it appears that the feature which varies may be inferior to that disclosed in the prior art and the invention nevertheless involve an innovative step.

The judgement also implicitly confirms that all prior art information may be relied upon in assessing innovative step provided it is publicly available, in contrast with inventive step where that information must satisfy the requirement of section 7(3).

World’s Second Biggest Selling Drug Survives Revocation Suit

Apotex Pty Ltd (formerly GenRx Pty Ltd) v Sanofi-Aventis [2008] FCA 1194, handed down on Tuesday, determined a validity challenge to the Sanofi-Aventis patent covering the drug Clopidogrel, marketed as Plavix, the second highest selling pharmaceutical worldwide.

While claims 1, 10 and 11 were found lacking novelty and claims 6 to 9 lacking inventive step, claim 3, which would be infringed by Apotex proposed sale of generic Clopidogrel in Australia, was held to be valid.

A line drawn in the sand on what is “patentable subject matter” in Australia

In Milton Edgar Anderson [2008] APO 19 (11 August 2008) Deputy Commissioner Spann has upheld the view that inventions relating to a mere scientific theory or discovery of the laws of science without a specific practical and useful application are not a manner of manufacture as required by section 18(1)(a) of the Australian Patents Act.

In this case the invention related to “the new science of subtronics” and “a new law of electric induction” and the alleged inventive concept resided in the “revelation and utilisation of an antimatter voltage force that stems from the discovery of electrosubtronic fields and culminated in the new science of subtronics”.

Deputy Commissioner Spann noted that section 18 sets limits on the subject matter for which a patent can be granted in Australia. In addition to the requirement that a claimed invention be novel and non-obvious, the subject matter must be a manner of manufacture. Whilst the notion of what is “a manner of manufacture” has evolved over time, the Delegate considered that there are certain fields that will always be excluded such as expressions of human intellectual activity, discoveries of the laws of nature or science, scientific theories, ideas, mere schemes and plans and mathematical algorithms per se unless they have been embodied in some technical application. In this particular instance the invention claimed was a scientific theory or discovery of the laws of science without any specific practical or useful application and therefore not patentable subject matter.

It is worth noting that the patent law in New Zealand has evolved in a way similar to that in Australia. That is decision of the High Court in National Research Development Corporation v. Commissioner of Patents (1959) 102 CLR 252 has been followed on many occasions by NZ Courts and Intellectual Property Office of New Zealand. With the introduction of a new Patents Act in late 2009 and having a provision identical to section 18 of the Australian Patents Act, it is expected that the Intellectual Property Office and of course the NZ courts will continue to adopt a similar line to Australia on what is deemed patentable subject matter.

Canopies Covered by a Single Valid Claim

In what may yet prove to be a hollow victory for the appellant, the decision in Insta Image Pty Ltd v KD Kanopy Australasia Pty Ltd [2008] FCAFC 139, handed down last Friday, saw the Full Federal Court overturn the trial judge’s findings on the public availability of a prior use, holding a number of the claims of the respondent’s patent to lack novelty.

However, in a move that will please many patent attorneys, the Full Court refused to find that the patentee had admitted certain matters to be common general knowledge by reference to prior publications in the patent specification.

At trial, Kiefel J held claims 1, 2 and 8 to 23 inclusive to have been infringed by each of two collapsible canopy products sold by Insta Image. Insta Image’s cross claim seeking revocation was dismissed. On appeal, Insta Image did not seek to disturb the findings on infringement but challenged the decision that the claims were novel and inventive.

The Full Court, after setting out five principles on the meaning of “publicly available” as used in section 7 (see [124]), overturned the findings of the trial judge and held that each of the claims other than claim 14 lack novelty in light of a publicly available prior use.

On the question of inventive step, the Full Court highlighted the importance of identifying the invention so far as claimed in any claim rather than what the inventor thought the invention consisted of (see [82] to [92]). The Full Court also made significant findings in relation to whether reference to prior art in the specification of the patent constituted an admission as to common general knowledge (see [97] to [104]). Relying on the decision of the High Court in Lockwood v Doric (No 2), and distinguishing the decision of Heerey J in Wrigley v Cadbury Schweppes, the Full Court held that:

The present Patent specification constitutes admissions by Mr Lynch as to his own familiarity with the inventions the subject of the earlier US patents mentioned and with the ongoing problem of instability of which he was aware, but does not constitute an admission by him as to the common general knowledge as it existed in the USA, let alone Australia, before the priority date.

Having regard to the evidence of the various expert witnesses, the Full Court upheld the trial judge’s decision that the claims were not obvious.

Accordingly, while Insta Image succeeded in showing all but one claim to be invalid and liable to be revoked, claim 14 will seemingly stand as a valid, and crucially an infringed claim.

Change in practice for post grant amendments to Australian Patents

The Australian Patent Office published notification in the Official Journal of Patents dated 24 July 2008 advising of a change in the way the Commissioner will handle post grant amendments.

Previously, after granting leave to amend and following the expiration of the three month period for opposition but before granting the amendments, the Commissioner issued notification requiring the patentee to provide a statement confirming that no relevant proceedings (ie court proceedings for infringement or revocation of the patent) were pending and set a one month date for the patentee to respond. For various reasons this practice led to administrative inefficiencies.

Accordingly, henceforth the Commissioner will, prior to allowance of any amendment to a sealed patent, issue a letter asking for advice on whether there are any relevant proceedings pending and give the patentee one month to provide that advice. This date is extendible by one month. It should be noted that if the requested advice is not received within the initial one month period or within the extended time, the Commissioner will move to formally refuse the request for leave to amend. It should also be noted that if relevant proceedings are pending the Commissioner will automatically refuse the amendment request and the patentee will need to reapply for leave to amend after such proceedings have been completed.

It is hoped that this change will rectify the current administrative nightmare associated with post grant amendments and bring some finality to the process.

EMDG scheme extended to IP expenditure

The Export Market Development Grants (EMDG) scheme is an Australian Government financial assistance program for exporters. The scheme reimburses up to 50% of expenses incurred on eligible export activities.

A number of changes were made effective 1 July 2008 (claimable from 1 July 2009). These include allowing costs of patenting products overseas (and obtaining trade marks overseas) to be eligible for support.

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.

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.

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 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.

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.

Case review - Ranbaxy Australia v Warner-Lambert Company

Phillips Ormonde & Fitzpatrick Lawyers' Fiona Galbraith has published an analysis of the Full Federal Court appeal - Ranbaxy Australia Pty Ltd v Warner-Lambert Company LLC(No 2) here.

Commonwealth v Charlesworth - Entitlement

This case (The Commonwealth of Australia v John Murray Charlesworth [2008] APO 16 (3 June 2008)) related to a successful challenge by the Commonwealth of Australia, c/– Minister for Defence under Sections 32 and 36 of the Patents Act in respect of a water concentration measuring device conceived by Dr John Murray Charlesworth while employed by Defence Science and Technology Organisation (DSTO).

In considering recent decisions on this issue including the decision of Justice French in University of Western Australia v Gray (No 20) [2008] FCA 498 Delegate Powell found that when trying to decide what the invention is, if the applicant has clearly stated in the specification what they believe their invention to be (possibly in a consistory statement or clause), and that invention is different to the prior art that is described in the specification, then it is reasonable to proceed on the basis that the invention is what the applicant says it is. To do otherwise would be to ignore the disclosure of the specification.

Federal Court to Implement new Patent Procedure

Attached as a schedule to the judgment of Heerey J in Black & Decker Inc v GMCA Pty Ltd (No 3) [2008] FCA 932 handed down yesterday was an outline of the Federal Court’s new procedure for the management of patent cases to be implemented on a trial basis.

The procedure is directed to narrowing the issues in dispute as early as possible in the proceeding in an attempt to reduce the time and cost of patent matters.

Post Trial Prior Art

In Delnorth Pty Ltd v Dura-Post (Aust) Pty Ltd [2008] FCA 875, handed down on 5 June 2008, Gyles J granted leave to Dura-Post to re-open its case seeking to revoke various innovations patents in the name Delnorth.

Following the close of the hearing of the matter, a prior published US patent came to the attention of Dura-Post, who brought an application to be allowed to amend the particulars of invalidity to rely upon the prior publication under the grounds of novelty and lack of innovative step, and tender the patent in evidence.

Gyles J, being satisfied that there was sufficient explanation as to the delay in raising the point, that the prior publication was of apparent relevance to the issues in the case and that any prejudice to Delnorth could be cured by appropriate orders as to costs, granted leave as sought. The court also noted that: “it is relevant to take into account that a patent revocation suit has some of the characteristics of an action in rem. It does affect the public and I must bear in mind that anybody else could come along and seek to revoke using this very piece of art.”

The decision is here.

ACIP to conduct review of patentable subject matter

On 2 June 2008, the Advisory Council on Intellectual Property (ACIP) announced that it will be conducting a review of patentable subject matter. The review will investigate the ‘appropriateness and adequacy’ of the manner of manufacture test, and the historical requirement that an invention must not be ‘generally inconvenient’. An Issues Paper is expected to be circulated in July, with consultations in late 2008 and a request for written submissions by September. Members of the PO&F Group will be taking part in the review. For more information about the review, click here

Purpose v Purposive

The decision of the Full Court in Term-Seal (Aust) Pty Limited v Termite Tite (NZ) No 2 Limited [2008] FCAFC 95, provides a reminder that when taking a purposive approach to claim construction, it is the purpose for which the patentee has used a particular form of language to define an integer of the invention which is relevant, not the purpose of that integer in the patentee's invention.

The first instance decision of Besanko J, previously discussed here, was appealed on the issues of infrigenment and validity.

On the question of infringement, the appellant sought to overturn the trial judge’s finding that their product included, as required by claims 1 and 2 of the patent in suit, a “membranous termite barrier comprising a matting impregnated with a termite resisting product”.

The appellant argued that while their barrier included matting which was impregnated with disodium octaborate (accepted to be a termiticide), the purpose of that chemical within the matting was to act as a preservative or fungicide and not to resist termite attack. The Full Court considered the relevance of that argument to be “elusive” stating that “Purpose can hardly affect construction of the claims or infringement of them where purpose is not part of any claim”.

Secondly, the appellants argued that their barrier did not include this integer of the claims because its termite resistant properties were entirely mechanical, such that the disodium octaborate was not an “effective” termite resisting product. This contention was also rejected, the Full Court stating that it:

“involves an unexpressed limitation of the integer said to be akin to a limitation based upon result. In other words, there is no infringement unless the appellants’ product is effective. The appellants argued a variation on that theme in that the relevant claims should be construed as requiring an effective chemical barrier, whereas their product utilised a physical barrier. We can see no warrant for reading such limitations into any of the relevant claims.”

The appellant’s arguments seeking to overturn the trial judge’s finding that the patent was valid in light of certain alleged anticipations were also rejected.

The case can be found here.

Costly Consequences

Three decisions handed down on 12 June 2008 illustrate how various tactical decisions can have implications on the costs awards made in intellectual property litigation.

In ITW AFC Pty Ltd v Loi and Tran Pty Ltd (No 2) [2008] FCA 895, Finkelstein J held that costs should lie were they fell in a patent dispute where both the claim for infringement and the cross-claim for revocation were unsuccessful. In rejecting the respondents argument that the proceeding should be treated as a single case in which the patentee failed, his Honour made several comments on the undesirability of parties bringing revocation actions without merit for purely tactical reasons concluding that:

“The usual order for bringing a hopeless case is to require the losing party to pay indemnity costs. Sometimes even that might not be enough. In patent litigation the parties are often large organisations that will not sufficiently feel the pain of an indemnity costs order. In those cases (I do not suggest this one) the proper order might be to require the legal practitioner to himself bear the costs, coupled with an order that the practitioner shall not be entitled to recover those costs from his client, notwithstanding any agreement to the contrary.”

In Nutrasweet Australia Pty Ltd v Ajinomoto Co Inc (No 4) [2008] FCA 876, also decided by Finkelstein J, his Honour was not prepared to award the successful party their costs on an indemnity basis because the ground upon which they had succeeded was raised only six days before the trial.

Finally, in Futuretronics.com.au Pty Limited v Graphix Labels Pty Ltd (No 3) [2008] FCA 896, Besanko J ordered that the applicant should have its costs of the infringement of copyright and breach of implied contractual term claims on which it succeeded, but that the respondents should otherwise have their costs of the proceeding. Despite the applicant being awarded only $10 nominal damages for the infringement of copyright, his Honour also made an order that the costs payable to the applicant not be reduced pursuant to O 62 r 36A(1) on the basis that copyright litigation is appropriately commenced in the Federal Court even where the monetary claim is small.

Dismissal of opposition

The case of Memcor Australia Pty Ltd v Zenon Environmental Inc. [2008] APO 14 follows on from decision of Delegate McCaffery in Les Laboratoires Servier v Apotex Pty Ltd [2008] APO 11 (11 April 2008).

This case relates to an application by Zenon Environmental Inc. for dismissal of an opposition under section 104 by Memcor Australia Pty Ltd. In this decision Delegate Barker confirms that the new practice of the Australian Patent Office in considering such applications will be that as reflected in section 31A of the Federal Court of Australia Act ie namely whether an opposition has any no reasonable prospect of success as opposed to the previous test which was whether an opposition is obviously or manifestly groundless or untenable.

In addition Delegate Barker reaffirms the longstanding view that decisions of the Commissioner do not give rise to an issue estoppel.

The decision is here.

False suggestion in specification

The most significant aspect of the recent Full Federal Court decision in Ranbaxy Australia Pty Ltd v Warner-Lambert Company LLC [2008] FCAFC 82 is the discussion of false suggestion and in particular, representations made in both the specification itself and during prosecution. In this case, the patentee was found to have made representations that the activity of a particular enantiomer compared to the racemate was "surprising and unexpected" and included data in the patent suggesting a tenfold increase in activity to support that representation. It was held that based on all the data available to the patentee, the increase in activity was only twofold.

In paragraph 99 the court states:

"While an applicant for a patent is not under an obligation to include all available data, where specific material is included, that material, if unqualified, should be representative of the available data."

The decision is here.

A note of caution about expert witnesses

On 12 May 2008, Tambelin J of the Federal Court handed down a decision in Esco Corporation v PAC Mining Pty Ltd [2008] FCA 640. Amongst other findings, his Honour gave significantly reduced weight to the evidence of the expert witness put forward by the respondent on the question of obviousness on the basis that he had been provided with a copy of the patent in suit prior to giving his evidence. At paragraph 83, his Honour commented that:
"a posteriori reasoning, which starts with an understanding of the solution to a given problem and then seeks to draw a conclusion as to how obvious it was to reach that solution, has been correctly criticised by the Courts. Where both the problem and the solution are put before a person from the outset, it becomes a simpler task to reason backwards from solution to problem, which may lead that person to draw an incorrect or flawed conclusion as to obviousness of the solution."

High Court rejects leave to appeal in patent case

On Friday 16 May 2008, the High Court rejected DuPont's application for special leave seeking to appeal a finding of the Full Federal Court that ICI was not estopped from defending patent opposition proceedings brought by DuPont. The opposed patent was a divisional application, the parent of which had previously been held invalid by Branson J of the Federal Court. The transcript is here.

WIPO nominates Australian as next Director General

Dr Francis Gurry has been nominated by WIPO's Coordination Committee to be the WIPO's next Director General. Dr Gurry is an Australian national, who studied law and commenced practice here before joining WIPO in 1985. The General Assembly needs to formally appoint him at it's next meeting in September.

The WIPO announcement is here.

New patents search system up and running

A new search system for Australian patents, called AusPat, is now in production as the Australian Patent Office's official source of online data.

The prior Patsearch and PATADMIN search systems should no longer be required.

Click here to see the story in full on IP Australia's website.

Australian innovators lack adequate IP strategies

The Age newspaper has reported an IP expert as saying Australian innovators are failing to capitalise fully on their research by not having a proper intellectual property strategy.

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Dismissal of patent opposition

The case of Les Laboratoires Servier v Apotex Pty Ltd [2008] APO 11 (11 April 2008) provides a useful summary of the principles applied by the Commissioner of Patents in determining a request for dismissal of a patent opposition.

Following is an excerpt from the Abstract of the decision:

Some general principles that flow through to the dismissal of patent oppositions from recent changes to Section 31A of the Federal Court Rules and subsequent Federal Court decisions are discussed. Notably, an opposition need not be “clearly untenable” or “manifestly groundless” in order for it to be dismissed. An opposition may be dismissed if it is considered to have no reasonable prospects of success.

The claims as accepted defined a new polymorph of perindopril tert-butylamine salt which was characterised by X-ray crystallography. Uses of the compound in pharmaceutical formulations and methods were also defined. The proposed amendments sought to include claims to the compound and methods with the further characteristic that the polymorph was in the form of “individual needles”. The opponent opposed the amendments under section 104 and addressed all grounds of opposition available under section 102. The applicant requested dismissal of the opposition on the basis that it was manifestly groundless and could not possibly succeed.

A consideration of the case set out by the opponent shows that it has no reasonable prospects of success. The opponent has not established that there is a real issue to be determined, or the issues identified are in respect to matters that do not arise as a result of the amendments and would not be sustainable in an opposition under section 104. On that basis the opposition is dismissed.

Need to file search results being discontinued

For some years there has been an obligation on applicants for Australian patents to lodge certain official search results with the Patent Office.

On 17 October, 2007, the Patents Amendment Regulations 2007 (No 1) removed that obligation in respect to all future (after 22 October) and many pending applications.

Search results are no longer required for

* Applications on which examination was requested on or after 22 April 2007, or

* Applications which were advertised as accepted for patent grant on or after 22 July 2007, or

* Applications lodged on or after 22 October 2007


Search results are still required to be lodged where

* Search results were completed before 22 April 2007, and

* Examination was requested before 22 April 2007, and

* The application was advertised as accepted for patent grant before 22 July 2007


Where the continuing obligation applies, it remains necessary to inform the Patent Office of the results of any official search results undertaken to assess the patentability of the invention disclosed in the application.

For patents granted before 22 April 2007, the continuing obligation only extends to search results completed before the date on which the patent was granted.

There are ongoing provisions for late lodgement of search results outside the prescribed time frames.

Non compliance with the obligation may continue to affect the allowance of any amendments proposed to a patent granted on the application.