Amcor Packaging (Australia) Pty Ltd v Barokes Pty Ltd
[2004] APO 20
•14 July 2004
OFFICIAL NOTICE
DECISION OF A DEPUTY COMMISSIONER OF PATENTS
Innovation Patent : No. 2003100154 in the name of Barokes Pty Ltd
Title: Process for packaging wine in aluminium cans
Action: Opposition by Amcor Packaging (Australia) Pty Ltd, and an objection to an extension of time to serve evidence in answer
Decision: Issued 14 July 2004
Abstract
Patentee sought an extension of time of 3 months to serve evidence in answer in an opposition to their innovation patent. There had been no previous extensions of time sought. The opponent objected to the extension. The opponent also requested the patentee's attorney be summonsed for cross-examination.
· The Commissioner has the responsibility to exercise her discretion to grant an extension of time having regard to all relevant circumstances. Lack of information about what the party has been doing, and what they need to do to complete their evidence, clearly hinders the Commissioner’s proper exercise of this discretion. In appropriate cases it would be more than proper to have the agent for the party seeking the extension of time examined on the activities that have been undertaken to date – such that the Commissioner is better able to correctly exercise her discretion.
· The attorney's actions were consistent with a reasonably diligent preparation of evidence in answer. In particular, there was no evidence of a deliberate delay – either by way of inattention to the task at hand, or by way of a deliberate strategy to delay the proceedings.
· Circumstances peculiar to filing evidence in oppositions to innovation patents discussed.
· The extension of time will be granted if the complete evidence in answer is served on or before 17 August 2004.
· Observed that the Commissioner will expect the opponent to serve any evidence in reply in the shortest time possible – which might reasonably be expected in the circumstances of the present case to be within the 3 months initially allowed under the regulations.
PATENTS ACT 1990
DECISION OF A DEPUTY COMMISSIONER OF PATENTS
Re:No. 2003100154 in the name of Barokes Pty Ltd, opposition by Amcor Packaging (Australia) Pty Ltd, and an objection to an extension of time to serve evidence in answer.
BACKGROUND
Barokes Pty Ltd [Barokes] applied for innovation patent 2003100154 on 3 March 2003 as a divisional application based on application 2002304976. Subsequent to grant, the patentee requested examination. The patent was certified on 31 October 2003. The invention relates to a process for packaging wine in aluminium cans.
Amcor Packaging (Australia) Pty Ltd [Amcor] filed a notice of opposition on 27 February 2004. That notice, together with the Statement of Grounds and Particulars, and evidence in support of the opposition, was served on the patentee on the same day. The opposition is supported by eight declarations. But the basis of the opposition relies on two factual circumstances. Firstly, a publication in an Italian journal Vignevini in 1992. Secondly, an alleged prior use of the invention in 2001, which involved Amcor arranging for a New Zealand company to fill 2 pallets of cans with wine supplied by the patentee.
On 26 May 2004 the Patentee filed an application for an extension of time of 3 months in which to serve evidence in answer. The reasons for the requested extension were stated on the application as being:
We have requested a clearer copy of Exhibit RL-2 which forms part of the Evidence-in-Support of the Opponent. The exhibit relates to the quality control checks made during the alleged canning of a wine in New Zealand. We are endeavouring to locate a beverage/canning technical expert to assess the Opponent’s evidence. Investigations have been commenced at Food Source Australia (Werribee) and further time is required to identify the expert and for him/her to assess the evidence and prepare a statutory Declaration.
We have located an expert analytical chemist witness to assist us in preparing the Evidence-in-Answer. Documents and samples have been sent to the expert witness for him to conduct analyses and report on. A preliminary report has been prepared. Further tests have been commissioned relating to the internal pressure of the canned wine.
Further time is required to complete the chemical analysis of wine and measurements of internal can pressures. Further time is then required to complete reports and prepare Statutory Declarations.
The opponent objected to the requested extension. The objection was set for hearing on 6 July 2004 in Canberra. The patentee was represented by Mr B Hess of counsel, instructed by Mr D Gibson (patent attorney of Callinan Lawrie). The opponent appeared by video and was represented by Mr E Heerey of counsel, instructed by Ms E Curry (solicitor, of Allens Arthur Robinson).
Prior to the hearing, Mr Gibson provided a declaration setting out in greater detail what he had done with respect to the evidence in answer. Ms Curry also filed a declaration in relation to exhibit RL-2, which the patentee alleged was illegible. Both parties also provided helpful written submissions.
Cross Examination of the patentee’s Patent Attorney
On 30 June, the opponent requested the Commissioner issue a Summons to Witness on Mr Gibson, the patent attorney for the patentee. The reason for the summons was stated to be:
We would submit that in application for extensions of time for serving evidence, one of the primary considerations to be made in deciding whether the applicant has made out a proper case justifying the extension is that of demonstrating diligence in pursuing the tasks required for completion of that evidence, and Mr Gibson’s oral evidence will be required to fully investigate this issue.
The summons was issued on 2 July 2004.
I note here that to my knowledge this is the first time the Commissioner has issued a summons to the patent attorney of a party in proceedings before her. From my own knowledge, many requests for an extension of time filed in opposition proceedings are remarkably uninformative. One might speculate that such lack of information might reflect a lack of activity by the relevant party. But the consequences of an implied waiver of privilege with respect to matters referred to in the request might equally explain the lack of detailed information. The Commissioner has the responsibility to exercise her discretion to grant an extension of time having regard to all relevant circumstances. Lack of information about what the party has been doing, and what they need to do to complete their evidence, clearly hinders the Commissioner’s proper exercise of this discretion. It seems to me that in appropriate cases it would be more than proper to have the agent for the party seeking the extension of time examined on the activities that have been undertaken to date – such that the Commissioner is better able to correctly exercise her discretion.
Mr Gibson provided evidence in chief, providing further information about his activities over and above the declaration he filed shortly before the hearing.
Mr Gibson was cross-examined at length with respect to his activities. The cross-examination exposed several issues where things could have been done quicker or with greater expedition. However I think it is very easy to criticise conduct after the event, with the benefit of the glare of hindsight. In my view, Mr Gibson’s actions were consistent with a reasonably diligent preparation of evidence in answer. In particular, I did not detect any evidence of a deliberate delay – either by way of inattention to the task at hand, or by way of a deliberate strategy to delay the proceedings.
Mr Gibson asserted that one of the difficulties he experienced was that there were only two companies manufacturing aluminium cans in Australia. One of these was the opponent. The other apparently had a company policy which discouraged their employees from giving evidence in legal disputes. Mr Gibson had now identified a suitable declarant who had recently retired.
One of the issues that Mr Gibson was cross-examined at length on, was with respect to exhibit RL‑2, and why a request for a better copy was only made near the end of the initial period for serving evidence in answer. Mr Gibson gave two explanations – that he thought material had been redacted; and that the significance of the document was not initially appreciated. I think both of these are plausible in the circumstances. Furthermore, while the opponent sought to criticise the conduct of the patentee on this issue, it is noteworthy that when the opponent supplied a ‘legible version’ of the document (as per their letter of 8 June 2004), Ms Curry stated
“We note that the document enclosed is not a copy of the document attached to the original statutory declaration of Robert Lewis, as we are unable to obtain a legible copy from our copy of Robert Lewis’ statutory declaration. We confirm that it is a reprinted version of the same document which appeared as exhibit RL-2”
[I also note that the copy filed with the Commissioner has large portions that are barely legible.] The responsibility for serving legible evidence lies with the party serving that evidence. When illegible evidence is served, it must be accepted that the recipient will need to infer the relevance of that illegible material. I don’t think the recipient can be significantly criticised if they reasonably draw an incorrect inference. And in my view, I do not consider the actions of Mr Gibson to have been inappropriate in this case. Rather, the root cause was the poor quality of the particular document served in evidence by the opponent.
I peripherally note here that there is a question of whether the evidence that can be relied upon by the opponent is solely the illegible copy as served on the opponent, or the subsequently-supplied legible version – which was clearly served well outside the time prescribed by reg 5.8(1A).
Considerations for granting an extension of time
The law for granting extensions of time under reg. 5.10(2) is well established: see Ferocem Pty Ltd v Commissioner of Patents (1994) 28 IPR 243, A Goninan & Co Ltd v Commissioner of Patents (1997) 38 IPR 213, and National Starch & Chemical Coy v Commissioner of Patents (2001) 50 IPR 398. The relevant principles developed in these decisions may be summarised as follows:
· The broad discretion afforded by Regulation 5.10 cannot be reduced to insistence on imperative compliance with particular requirements;
· The exercise of this discretionary power requires proper, genuine and realistic consideration of all the relevant aspects that pertain to the application;
· The provision of a satisfactory explanation of the delay is a relevant consideration, but is not mandatory;
· The public interest in determining a serious opposition on its merits is a relevant consideration and must be balanced with the requirement that matters before the patent office should be dealt with in an efficient, orderly manner and not be unduly prolonged;
· The interests of the opponent, the applicant and any other parties are a relevant consideration.
However these decisions, and related decisions of the Commissioner, all relate to the pre-grant opposition environment. The present case is the first instance of a contested extension of time in an opposition to an Innovation Patent. Such an opposition is post-grant, and in my view there are certain differences in the environment which may (depending on the factual circumstances) be relevant.
· In pre-grant oppositions, the applicant will have had many months advance notice of the basis of the opposition that has to be answered, by the Statement of Grounds and Particulars being served before the evidence in support is served. In an opposition to an Innovation Patent, the patentee has no prior notice of the case they have to answer – or even of the existence of an opposition – prior to the commencement of the time for serving evidence in answer;
· In pre-grant opposition proceedings, a delay by the applicant in serving their evidence is ultimately a delay in when they can start enforcing their patent. In an opposition to an Innovation Patent, a delay by the patentee (in circumstances where the patent is invalid) leads to an extension of the period of apparent enforceability of the patent.
· In oppositions under s.59, a significant evidentiary burden typically exists in relation to inventive step, and establishing relevant common general knowledge. This ground does not exist for Innovation Patents; rather there is the ground of innovative step. Whilst there has not yet been any decisions of the commissioner on this ground, nor any judicial consideration, prima facie the evidentiary burden is prima facie much less than for inventive step.
· In oppositions under s.59, an applicant who is under pressure to serve their evidence in answer can circumvent the objections of the opponent by filing a ‘photocopy’ divisional patent application under s.79B – and withdraw the opposed application (with the opponent apparently having little redress vis-à-vis costs thrown away as a result). In an opposition to an Innovation Patent, the Patentee is unable to file any such divisional application. [But I note that in the present case there is a parallel application for a standard patent.]
Inevitably, disputes about the time for service of evidence are driven by a variety of motives. In this regard I note my comments in ExxonMobil Chemical Patents Inc v The Associated Octel Company Limited [2003] APO 3 – which are equally applicable to oppositions to innovation patents, with some role reversals as a result of being post-grant:
11. The opposition mechanism of s.59 allows third parties to challenge the validity of a patent application prior to grant. The parties to the proceedings clearly have divergent interests. Prima facie, the applicant wants to maintain their monopoly rights to keep competitors out of the market. This may mean that the applicant wants an early disposition so that they can enforce their patent. However in some situations the applicant may wish to delay proceedings for as long as possible (perhaps in the knowledge that their patent rights may not be valid), and other applicants may wish to delay proceedings in Australia because of events occurring in other jurisdictions. Similarly opponents might want a quick disposition so that they can enter the market place. But they may also want to protract the proceedings in an attempt to obtain advantage over the applicant - whether that be through perceived financial weakness of the applicant, or the cost of the proceedings leading to a favourable settlement and so on.
12. I do not mention these to suggest that any particular one of these relate to the parties in the present proceedings. Rather, to note that in the evidentiary procedures leading up to the substantive hearing in an opposition, there are many and varied reasons for the conduct of the parties. It is against this background that I consider that the primary responsibility of the Commissioner is to ensure that the evidence in opposition proceedings is provided in as short a time as is reasonably possible, consistent with ensuring that the parties have every reasonable opportunity to provide full evidence in support of their case, and upon the insistence of proper professional standards. That this is so is apparent from the comments of Burchett J in Ferocem Pty Ltd v Commissioner of Patents, (1994) 28 IPR 24
"The determination of an application for an extension of time under reg. 5. 10(2) involves a balancing exercise, in which competing considerations must be taken into account. There are interests of the persons directly concerned in the application and opposition in question. There are also public interests, which are not necessarily ranged on the same side. They include the expeditious disposal of matters in the Patents Office, and questions of costs, of efficiency, and of insistence upon proper professional standards being maintained by those who deal with the office. But they also include, as Kitto J pointed out in Kaiser Aluminium & Chemical Corporation v The Reynolds Metal Co (1969) 120 CLR 136 at 143, ' the public interest that a serious opposition by a person entitled in fact to oppose the grant of a patent should be dealt with on the merits, rather than that it should be shut out in consequence of a failure of procedure, lamentable though the failure may be'".
As I noted earlier in the context of the cross-examination, I consider Mr Gibson’s actions were consistent with a reasonably diligent preparation of evidence in answer. At the hearing Mr Gibson stated that the evidence to be served in the opposition was:
a) a declaration concerning experiments already conducted
b) following some further experiments still to be conducted in relation to can pressure, a further declaration on those experiments; and
c) a declaration from a person skilled in the art in Australia concerning common general knowledge.
It seems to me that these declarations are likely to be very relevant evidence in these proceedings. Also, in cross-examination Mr Gibson indicated that the experiments already conducted raise serious questions about whether the test data included in the evidence in support was in respect of the correct wine – and therefore of its relevance. And in such circumstances I think the patentee should be given the proper opportunity to serve repudiating evidence.
Accordingly, I am of the view that the patentee is entitled to an extension of time to serve its evidence in answer in the opposition. However the question is – how long?
Historically, extensions of time in oppositions before the Commissioner have been dealt with on a request-by-request basis. A consequence of this is a lack of control of the overall evidentiary process, with parties filing new extension requests as each extended period expires, potentially for many years. Innovation Patents inherently involve less-complex oppositions than for standard patents. Firstly, there is a limit on the number of claims that are present. Secondly the evidentiary issues for innovative step ought to be much less burdensome than for inventive step. Accordingly, as a starting position it would seem to me that a 3-month period for serving evidence in answer in an Innovation Patent opposition should normally be sufficient to complete that evidence – even allowing for the absence of prior warning of the opposition. And if that period is not sufficient, it would seem reasonable to expect that any required extension should not be particularly long. In that context, the past practice of the Commissioner in simply dealing with each extension request as and when they are sought does not seem conducive to ensuring an appropriately rapid determination of oppositions to Innovation Patents.
At the hearing, Mr Gibson advised that declaration referred to in para 15(a) above would be ready to serve within 2 weeks of the hearing date (that is, by 20 July 2004). Similarly declaration (b) would be ready to serve within 4 weeks of the hearing date (that is, by 3 August 2004). With respect to the third declaration, he indicated that a period of 8 weeks was required. On further query, it was apparent to me that there was some uncertainty about whether the declarant was prepared to assist, and/or meet a time frame. In the circumstances I invited the patentee to advise me by 12pm Friday 9 July of what time they needed to serve this declaration.
Subsequent to the hearing:
· Mr Gibson forwarded a copy of correspondence with the opponent, wherein he suggested that he would need up until 17 August 2004 to serve the declaration concerning common general knowledge from the proposed declarant; and that this date followed from telephone discussions with the declarant subsequent to the hearing. He stated that he anticipated the draft declaration would be prepared by the end of July, and that the extra time would be required to settle the declaration. He also advised that the attorney for the opponent had verbally rejected this proposal.
· Ms Curry advised that from the opponent's point of view "it would not be reasonable in all the circumstances, to grant an extension of time to 17 August 2004 in respect of the common general knowledge evidence", noting that the proposed date was 6 weeks from the hearing date. She noted that the extension has the potential to 'prolong the life of an invalid but enforceable patent'. She also observed that the opposition procedures for innovation patents were intended to be streamlined, noting the regime whereby the notice of opposition, Statement of grounds and particulars, and evidence in support, must be served at the same time.
I am indeed concerned to ensure that the evidence in an opposition is provided in as short a time as is reasonably possible. But mere imposition of an absolute deadline can well lead to situations where a party is prevented from reasonably preparing their case. It is clear from the decided cases that it is an error in the exercise of discretion to elevate a factor to being an imperative. Rather all factors must be taken into account - including the diligence of the party in putting their case together, the overall time that has elapsed, and the effect of maintaining the patent if ultimately it is found invalid.
Having regard to these circumstances, I think that the request of the patentee – to allow up until 17 August 2004 for service of the declaration – is reasonable. It seems to be pragmatically justified in all the circumstances, having regard to the need to obtain experimental evidence, and the difficulties that were experienced in finding an expert witness prepared to give evidence. I agree with the opponent that the process of serving evidence in answer should be relatively quick, and should not be subject to lengthy extensions of time. I do not think the patentee should be cut off from properly preparing their case, by elevating timeliness to an imperative – but I do need to ensure that the evidence is served within a reasonable time frame. And I note that the time now requested by the patentee is in fact 10 days earlier than the date sought in the original request.
In ExxonMobile Chemical Patents Inc v The Associated Octel Company Limited [2002] APO 34, the delegate did not immediately grant an extension of time for service of evidence-in-answer to a patent opposition. Rather, the decision was to grant the extension sought if the applicant served their evidence by a specified future date. I think this is a reasonable approach to follow in cases such as the present.
In these circumstances, I consider the appropriate way to proceed is as follows:
· Providing the complete evidence in answer is served on or before 17 August 2004, I will grant the extension of time that has been sought by the patentee.
· It may well be that new circumstances intervene that will prevent service of the evidence by 17 August 2004. I foreshadow that such circumstances would likely need to be of a force majeur nature in order for me to reconsider the time for serving evidence in answer.
· Upon service of evidence in answer, the opponent has a period to service evidence in reply. I note that acceptance of a desire to deal with the evidentiary stages quickly applies to all stages of the opposition. That is, the Commissioner will expect the opponent to serve any evidence in reply in the shortest time possible – which might reasonably be expected in the circumstances of the present case to be within the 3 months initially allowed under the regulations.
COSTS
Both parties sought an award of costs in their favour. The patentee asserted that costs naturally follow the event, and if the extension was granted they were entitled to their costs. The opponent asserted that if the extension was granted it wasn’t on the basis of the information provided in the application.
It is not uncommon in extension of time proceedings for an extension to be granted to a party, but that costs be awarded against that party – on the ground that the objection raised was reasonable having regard to the information provided in the application, and the reason justifying the extension were only properly explained at the hearing. I think this applies in the present case.
However much of the opponent’s criticism of the patentee was associated with the patentee’s treatment of an exhibited document which was prima facie illegible – with no apparent recognition by the opponent that their failure to serve legible evidence was a contributing factor.
In these circumstances, I make no award of costs.
D Herald
Deputy Commissioner of Patents14 July 2004
Patent attorneys for the patentee : Callinan Lawrie, Melbourne
Patent attorneys for the opponent : Allens Arthur Robinson, Melbourne
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