American National Can Company v Cryovac Inc
[2000] APO 20
•9 March 2000
OFFICIAL NOTICE
DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS
Application : No. 571175 in the name of AMERICAN NATIONAL CAN COMPANY
Title: Polymeric and film structure for use in shrink bags.
Action: Application under Regulation 5.5 for dismissal of the opposition under Section 104 filed by CRYOVAC INC
Decision: Issued
Abstract
The opposition under section 104 as outlined in the original statement of grounds and particulars is clearly untenable and should be dismissed. Attempts to remedy this defect by amendment under regulation 5.9 is inappropriate for a number of reasons including the time factors involved in raising new particulars, the fact that the opposition as filed appears not to be a serious opposition and that the opponent can still raise the issues at final determination.
PATENTS ACT 1990
DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS
Re:Patent Application No. 571175 in the name of American National Can Company and opposition thereto under section 104 by Cryovac, Inc, and an application for dismissal of the opposition.
BACKGROUND
Patent application 571175 (12308/83) was filed on 9 March 1983 by American Can Company claiming priority from a US basic application (US 371781) filed on 26 April 1982. The rights in the Australian application were subsequently transferred to the current applicant, American National Can Company (ANCC) and this change was recorded in February 1988.
On 14 April 1988, patent application 571175 was advertised accepted. A notice of opposition under section 59 was filed on 13 July 1988 by W.R. Grace & Co. -Conn (Grace). This opposition was heard in Canberra on 28 and 29 September 1993 and a decision issued on 10 January 1994. The opposition succeeded on the grounds that the specification did not comply with section 40 and that the claims were prior claimed. The delegate allowed the applicant 60 days from the date of the decision to propose amendments to overcome these deficiencies.
ANCC filed a request to amend on 9 March 1994. Leave to amend was granted and particulars of the request advertised on 20 October 1994. On 20 January 1995, Grace filed a Notice of Opposition to the amendments. No evidence was served in relation to this opposition under section 104 and it was heard in Melbourne on 11 August 1997.
A decision was issued in relation to this section 104 opposition on 7 November 1997. The hearing officer concluded that the proposed amendments did not fall within the scope of the claims of the specification before amendment and consequently refused the amendments. However, she allowed the applicant 30 days from the date of the decision to propose new amendments to overcome the deficiencies identified in the earlier substantive hearing.
On 5 December 1997, a second request to amend under section 104 was filed. There were several statements of amendments filed in relation to this request (5 December 1997, 27 January 1998, 10 February 1998, and 5 March 1998).
Leave was granted to amend on 27 May 1998 and this was advertised for opposition purposes on 11 June 1998. Sealed Air Corporation (a related company to Grace) filed a Notice of Opposition on 11 September 1998 followed by a statement of grounds and particulars on 11 December 1998. On 13 January 1999, ANCC filed a request for dismissal of this opposition under regulation 5.5(1) but, before this matter could be heard, the delegate noted that there were serious defects in the way the amendments had been proposed. The amendments were based on the specification as if it had been amended by the request of 9 March 1994. However, as that request was refused, the amendments needed to be based on the specification prior to 9 March 1994. Amending the correct specification in the way proposed by the applicant lead to serious clarity deficiencies in the claims and the amendments were clearly not allowable. The delegate therefore formally refused these amendments on 5 February 1999.
The applicant filed a third request for amendment on 5 February 1999 (with two statements of amendments dated 5 February 1999 and 25 February 1999). These amendments were the same as proposed in the earlier request of 5 December 1997 but based on the correct specification. These amendments were advertised allowed on 3 June 1999 and, on 3 September 1999, Cryovac, Inc (a related company to Sealed Air Corporation and Grace) filed a Notice of Opposition. Their statement of grounds and particulars was filed 3 months later (on 3 December 1999) and was almost the same as that filed by Sealed Air Corporation on 11 December 1998 in relation to the amendments of 5 December 1997. On 24 December 1999, ANCC filed a request for dismissal of this opposition under regulation 5.5(1). This was set for hearing in Melbourne on 24 February 2000. David Tadgell and Neil Ireland of Phillips Ormonde & Fitzpatrick, Melbourne represented the applicant and Andrew Dark of Davies Collison Cave, Melbourne represented the opponent.
THE STATEMENT OF GROUNDS AND PARTICULARS
The statement of grounds and particulars filed on 3 December 1999 (hereafter referred to as the original statement) listed two grounds of opposition:
The specification does not comply with sub-section 40(3) in that the claims are not succinct and are not fairly based on the specification.
A claim or claims of the specification does not in substance fall within the scope of the claims prior to amendment and was not in substance disclosed in the specification as filed.
There were three pages of particulars listed under one or other of those grounds. However, the opponent conceded that they would only be relying on the following particulars:
Ground 1
Claim 22 (sic) is unclear with respect to the use of the terms "consists of", "contains", "comprises", "essentially", "is" and "overall".
Claim 2 is unclear with respect to the term “from 10 to 19 or 71 to 90% linear low density polyethylene”. It is unclear whether the claimed range includes the values 10 and 71, 71 or neither”
Ground 2
The use of the term "comprising" and the related terms "comprises", "consists of", "consisting of", and "is" alters the scope of the claims beyond the disclosure in the specification as filed and therefore beyond the scope of the claims prior to amendment. The use of these and other terms have resulted in a lack of clarity in the claims which has also resulted in the claims claiming matter not in substance disclosed in the specification as filed.
SUBSTITUTE STATEMENT OF GROUNDS AND PARTICULARS
The opponent filed a substitute Statement of Grounds and Particulars on 23 February 2000 (the day before the hearing) in which many of the original particulars had been deleted. They also clarified particular 1 of the original statement of grounds and introduced new particulars under grounds 1 and 2. The substitute particulars are as follows:
Ground 1
Claim 2 is unclear with respect to the use of the terms "consisting of" and comprising".
Claim 2 is unclear with respect to the term "from 10-19% or 71 to 90% linear low density polyethylene". This range was considered by the delegate of the Commissioner, albeit when applied to a five layer structure, in the decision of 7 November 1997 relating to an opposition to the amendments of the present application dated 9 March 1994. In this decision, the delegate clearly states that "What is clear, even without detailed analysis of the embodiments described, is that neither the ranges themselves nor any specific instances are disclosed for any of the pairs of layers in which the linear low density polyethylene (LLPDE) content falls within the proposed 71% to 90% range, nor for the copolymer of ethylene and vinyl acetate (EVA) content within the equivalent proposed 10% to 29% range. Thus the amendment fails the third Mond-Nickel guideline, i.e. it includes as a characteristic of the invention a feature as to which the basic application is wholly silent". Claim 2 fails for the same reason.
Claims 7 and 10 similarly claim as a characteristic of the invention a feature as to which the application is wholly silent insofar as the proviso for those claims defines the second pair of layers containing from 10 to 19% LLDPE with the remainder being EVA. This range is not provided with support in the specification as filed.
Ground 2
Claims 2, 7 and 10 would, as a result of the amendments, include ranges as described in the preceding paragraphs which are provided with no support in the specification as filed. Hence, as a result of the amendment, the specification would claim matter not in substance disclosed in the specification as filed.
At the hearing, I advised that the substitute statement of grounds and particulars is a request under Regulation 5.9 to amend the Statement of Grounds and Particulars. I noted that the Commissioner is not permitted to allow such a request during consideration of an application for dismissal (Regulation 5.9(2)(a)). Therefore, the hearing would need to proceed on the basis of the original statement. However, I would also consider submissions from the parties at the hearing on how the proposed amendments would affect the dismissal action.
DECISION
The principles to be applied in considering a request for dismissal are well established and are similar to the reasons for summary dismissal which are described in General Steel Industries Inc v Commissioner for Railways(NSW) and others (1964), 112 CLR 125:
"It is sufficient for me to say that these cases uniformly adhere to the view that the plaintiff ought not to be denied access to the customary tribunal which deals with actions of the kind he brings, unless his cause of action - if that be the ground on which the court is invited .. to exercise its powers of summary dismissal - is clearly demonstrated. The test to be applied has been variously expressed; "so obviously untenable that it cannot possibly succeed"; "manifestly groundless"; "so manifestly faulty that it does not admit of argument"; "discloses a case which the court is satisfied cannot succeed"; "under no possibility can there be a good cause of action"; "be manifest that to allow them (the pleadings) to stand would involve useless expense".
At times the test has been put as high as saying that the case must be so plain and obvious that the court can say at once that the statement of claim, even if proved, cannot succeed; or "so manifest on the view of the pleadings, merely reading through them, that this is a case that does not admit of reasonable argument"; "so to speak apparent at a glance"."
On this basis, an opposition or a ground of opposition will be dismissed only if it is clear that the opposition could not possibly succeed. In bringing this action the onus falls on the applicant to show that the opposition is clearly untenable. I note that a dismissal action is not intended to be de facto hearing of the substantive opposition. Barwick J in General Steel Industries Inc v Commissioner for Railways(NSW) and others (supra) states that "great care must be exercised to ensure that under the guise of achieving expeditious finality a plaintiff is not improperly deprived of his opportunity for the trial of his case by the appointed tribunal". However, Barwick J. also noted that dismissal is not reserved for cases where argument is unnecessary to evoke the futility of the plaintiff's claim and that it can be invoked in clear cases where the court is satisfied that "that it has the requisite material and the necessary assistance from the parties to reach a definite and certain conclusion".
Technical defects of the original statement
The applicant initially raised two technical defects regarding the original statement:
Ground 1 does not specify that the alleged section 40(3) deficiencies are as a result of the amendment. Under regulation 5.3(4), a person must not oppose the allowance of a proposed amendment of a complete specification except on the grounds that the amendment is not allowable under section 102 of the Act. Section 102(2)(b) specifies inter alia that an amendment of a complete specification is not allowable after acceptance if, as a result of the amendment, the specification does not comply with section 40(3).
The first particular under ground 1 does not make any sense because it refers to claim 22 which is an omnibus claim and contains none of the words alleged to be objectionable.
With regard to the first defect, I note that the statement of grounds and particulars should be given a purposive construction. This is consistent with the approach in Borden Inc v Elkem A/S 24 IPR 146 where the delegate concluded:
"The correct approach to this is, in my opinion, to apply a purposive construction the Statement of Grounds and Particulars. This would be consistent with a substantial body of case-law dealing with this type of circumstance….While it is certainly regrettable that the Statement of Grounds and Particulars should be flawed in such a fundamental manner as that to which I have adverted, I do not believe it is flawed to an extent which prevents it from achieving the underlying purpose of Regulation 5.4 of the Patents Regulations."
In the current case, ground 1 of the original statement did not specify that the defect is “as a result of the amendment". However, if the particulars allege a defect which would occur “as a result of the amendment”, then I do not see that the omission of these words in the ground should invalidate the ground. On the other hand, if the particulars are not directed to a problem which would occur “as a result of the amendments” then I agree that the ground is not valid because it is outside the scope of section 102(2)(b). Either way, the omission of the term by itself is insufficient basis for me to dismiss the ground and I need to analyse the substance of the particulars further.
With regard to the second defect, I agree that there was a clear error in identifying claim 22 as the objectionable claim. As the applicant noted, and the opponent conceded, none of the words alleged to be objectionable were present in claim 22. There was some debate between the parties whether it was obvious which claim was in fact intended. However, even if this were not obvious, I still do not think it appropriate to dismiss an opposition merely on the basis that the wrong claim was identified in the drafting of the statement if there is some substance to the objection. This is consistent with the principles outlined in Kaiser Aluminium and Chemical Corporation v. The Reynolds Metals Company (1969) 120 CLR 136.
Thus, I find the technical defects by themselves do not provide a basis for dismissal. I have to analyse the substance of the particulars under each of the grounds to determine whether there is such a basis or not.
Analysis of the original statement of grounds and particulars
The first particular relied on under ground 1 in the original statement of grounds and particulars was that claim 22 (sic) is unclear with respect to the use of the terms "consists of", "contains", "comprises", "essentially", "is" and "overall". The opponent conceded that they were only objecting to the use of the terms "consisting of" and comprising" in claim 2. The applicant argued that those terms were already in the specification before the amendment. Therefore any perceived problem with these terms could not have been as a result of the amendment and therefore did not fall foul of section 102(2)(b).
The opponent argued that claim 2 is a new independent claim and as such the clarity of the above terms in that claim is open to argument notwithstanding that these terms may have been included in several other claims of the application as considered in the substantive opposition proceedings.
I do not accept the opponent’s argument. Just because claim 2 is a new independent claim does not mean that every term in the new claim can be reargued. Claim 2 contains the same terms used in the same way as many of the claims before amendment. It is not plausible that a term such as “comprising” which was widely and consistently used through the claims prior to amendment would suddenly change meaning in one of the claims because of the amendment and the opponent has not provided any explanation for why such a change of meaning would occur. I find this particular does not fall within the scope of section 102(2)(b) and is therefore untenable.
For similar reasons, the only particular listed under ground 2 is also untenable. The opponent argued that the use of the terms "comprising" and “consisting of” alters the scope of the claims beyond the disclosure in the specification as filed and therefore beyond the scope of the claims prior to amendment. They also suggested that the use of these terms have resulted in a lack of clarity in the claims which has also resulted in the claims claiming matter not in substance disclosed in the specification as filed. As noted above, the terms “comprising” and “consisting of” are not objectionable "as a result of the amendment" under section 102(1) or (2) and this particular cannot support a ground of opposition under section 104.
The second particular listed under ground 1 was that claim 2 is unclear with respect to the term “from 10 to 19 or 71 to 90% linear low density polyethylene” because it was unclear whether the claimed range includes the values 10 and 71, 71 or neither. The applicant did not provide submissions regarding the substance of this particular nor did the opponent attempt to defend it as drafted. However, in my view, this particular is manifestly untenable at a cursory glance. Many of the accepted claims in the current case contain ranges. It is not plausible that an amendment to introduce another (albeit narrower) range would be interpreted differently than the other ranges "as a result of the amendment". Further, ranges such as those in claim 2 are commonly used in claims of patent specifications and the end point of the range is always included unless specified otherwise. I do not accept that an opponent can argue that an undoubtedly clear term is unclear simply to mount an opposition under section 104. I believe this is a case where I can reach a "definite and certain conclusion" without proceeding to trial. I also doubt the seriousness of the objection as ranges appear in other claims but these were not objected to. It is difficult not to conclude that this objection was frivolous and the opposition not serious.
In my opinion, none of the particulars in the original statement provide any indication of material facts which support either of the grounds of opposition and the opposition set out in the original statement of grounds and particulars is clearly untenable.
Effect of proposed amendments to the statement of grounds and particulars
Having decided that the original statement of grounds and particulars is manifestly untenable, I then have to determine whether the amendments now being proposed affect my decision whether or not to dismiss the opposition.
The opponent referred me to the office decision of Supreme Corq v Anthony Smith Australasia Pty Ltd (1999) APO 19 (8 March 1999). In that case, a request for dismissal was filed in relation to an opposition on the basis that a ground of opposition was not adequately particularised. The opponent (Anthony Smith Australasia Pty Ltd) filed an amended statement of grounds and particulars two days prior to the hearing on the request for dismissal setting out further particulars in relating to the ground in question. The hearing officer concluded that the particular being relied on was "manifestly inadequate for its purpose" but considered it appropriate to direct the opponent to provide further and better particulars because:
"One may ask why those particulars were not provided in the first instance but I do not think this alone would justify the Commissioner dismissing the ground of opposition when the particulars now sought to be included indicate that the issue is being pursued seriously (Kaiser Aluminium and Chemical Corporation v. The Reynolds Metals Company (1969) 120 CLR 136. See also Alvern Norway v Trans Global Concepts, supra, in relation to the Commissioners discretion to direct further and better particulars)."
The opponent also referred me to another office decision in L'Air liquide v CIG Ltd 24 IPR 77 where the then Assistant Commissioner concluded on page 87:
"I do not consider it appropriate for an opponent to make an ambit claim in their statement of the grounds of opposition with an expectation of being permitted to at some later stage to be able to particularise those grounds. In my view, if an opponent cannot provide particulars in support of an alleged ground of opposition, the opponent has no basis to oppose on that ground. The opponent should not proceed in respect of any ground of opposition that is not particularised; (subject of course, to amendment of the statement of grounds and particulars under regulation 5.9)."
The opponent argued that the view reached by the delegate in Supreme Corq case is supported by the comments made in L'Air liquide insofar as the then Assistant Commissioner indicated that the question of whether an opposition should proceed in absence of particulars is still subject to the consideration of possible amendment of the statement of grounds and particulars.
I do not think either the Supreme Corq or the L'Air liquide cases contemplate that an opponent should always have the opportunity to remedy an obviously untenable opposition by amendment of the statement of grounds and particulars. I note that this would be inconsistent with the approach in Mobay Corp. v Dow Chemical Co. 24 IPR 379. In that case, the hearing officer took guidance from B.C. Cairns in Australian Civil procedure 3rd Ed. (1992) and concluded that:
"A distinction must be drawn between a failure to plead a material fact with sufficient particularity and a failure to plead a material fact at all. Failure to plead a material fact at all may not be remedied by particulars. But where a material fact is pleaded, but not with sufficient particularity, then it is proper for it to be supplemented by particulars."
In the Supreme Corq case, the hearing officer concluded that a material fact was present in the ground of opposition under dispute. Following the principles outlined in Mobay, it would therefore have been appropriate to allow the opponent an opportunity to amend the particulars.
I note that the hearing officer in Supreme Corq further commented that even if he were to be wrong regarding the material facts he did not think the finding in Mobay, while persuasive, can be followed in the absence of a consideration of all relevant circumstances. He concluded that the issue was seriously being pursued and that therefore the principles of Kaiser Aluminium and Chemical Corporation v. The Reynolds Metals Company (supra) should apply. However, he distinguished the Supreme Corp case from cases where the Commissioner finds no indication of material facts with the only possible conclusion being that that the ground is an ambit assertion.
In the current case, the opponent argued that there was a basis in the original statement of grounds and particulars to support the addition of the new particulars. Specifically, the opponent referred to the particular:
Claim 2 is unclear with respect to the term “from 10 to 19 or 71 to 90% linear low density polyethylene”. It is unclear whether the claimed range includes the values 10 and 71, 71 or neither”.
The opponent conceded that this particular was somewhat unclear but that an objection to claim 2 on the basis of the insertion of the term “from 10 to 19 or 71 to 90% linear low density polyethylene” is well founded. The opponent submitted that the clarity of this term is unclear when taking into consideration the decision of the delegate dated 7 November 1997 on the amendments of 9 March 1994 where the delegate came to the clear conclusion that "what is clear, even without detailed analysis of the embodiments described, is that neither the ranges themselves nor any specific instances are disclosed for any of the pairs of layers in which the LLDPE content falls within the proposed 71% to 90% range, nor for the EVA content within the equivalent proposed 10% to 29% range." The delegate therefore concluded that the amendment failed the third Mond-Nickel rule and was not fairly based.
In my view, the original particular is clear but it is a different allegation to the one the opponent is seeking to introduce by amendment and does not contemplate the allegation now raised by the opponent. I therefore do not agree that the original statement of grounds and particulars provides a basis for adding any of the new particulars.
The opponent further submitted that the new particulars themselves should be a basis for not dismissing the opposition. They argued that it was in the public interest that an opposition should be dealt with on its merits and not shut out as a consequence of a failure in procedure. In addition, the applicant should have been aware of the inherent problems with the amendments in view of the November 1997 decision.
While these may be relevant considerations, there are many other factors raised by the applicant which strongly mitigate in favour of dismissing the opposition including:
The opponent will have a forum to consider the amendments which have been filed post substantive hearing when the matter is ultimately set for final determination.
The allegedly inherent problems which the opponent argues should have been realised by the applicant have only been raised now by the opponent although the amendment was originally proposed in 1994. There was also no adequate explanation of why the new particulars were only raised at this stage.
The opponent had the opportunity to oppose the amendment when they filed an opposition to earlier proposed amendments in 1995. Claim 2 was not referred to in the Statement of Grounds and Particulars on that opposition nor was it referred to in the decision of 7 November 1997.
The original statement of grounds and particulars as a whole was manifestly inadequate and contained no indication of material facts. Further, some of the issues raised in that statement appear frivolous and as a result, there does not appear to be a serious opposition.
The application was filed in 1983 and a patent, if granted on this application, will be due to expire in 2003. The delegate is still to consider one document under a "bar-to-sealing" action and the matter is yet to be set for final determination. It is not in the public or applicant's interests to prolong this opposition further.
Balancing these factors against those raised by the opponent, I consider that it is inappropriate to attempt to remedy the defects in the Statement of Grounds and Particulars by amendment under regulation 5.9.
CONCLUSION
The opposition as outlined in the original statement of grounds and particulars is clearly untenable and should be dismissed. There is no indication of material facts in the original opposition and attempts to remedy this defect by amendment under regulation 5.9 is inappropriate for a number of reasons including the time factors involved in raising new particulars, the fact that the opposition as filed appears not to be a serious opposition and that the opponent can still raise the issues at final determination. I therefore dismiss this section 104 opposition. Subject to appeal, I also direct that the amendments the subject of the request dated 5 February 1999 proceed to allowance.
COSTS
Costs normally follow the event and I see no reason to depart from this in this case. The applicant has been successful in their application for dismissal. Consequently, I award costs against the opponent.
Karen Ayers
Delegate of the Commissioner of Patents
Patent attorneys for the applicant: Philips Ormonde & Fitzpatrick
Patent attorneys for the opponent: Davies Collison Cave
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