Arch Wood Protection Pty Ltd v Osmose New Zealand
[2014] APO 82
•12 December 2014
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Arch Wood Protection Pty Ltd v Osmose New Zealand [2014] APO 82
Patent Application: 2011200045
Title:Wood Impregnation
Patent Applicant: Osmose New Zealand
Opponent: Arch Wood Protection Pty Ltd
Delegate: Xavier Gisz
Decision Date: 12 December 2014
Hearing Date: Written submissions completed 15 November 2014
Catchwords: PATENTS - extension of time to file evidence in answer – Regulation 5.9 – whether the applicant has acted promptly and diligently at all times – actions were prompt and diligent at all times – extension of time allowed
Representation: Patent applicant: AJ Park, Auckland
Opponent:Shelston IP, Sydney
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2011200045
Title:Wood Impregnation
Patent Applicant: Osmose New Zealand
Date of Decision: 12 December 2014
DECISION
The requested extension of time is allowed. The time to file evidence in answer is extended until 8 October 2014.
This decision provides notification to the Opponent that all evidence in answer has been filed as required under regulation 5.8(4)(b). The Opponent now must file any evidence in reply within 2 months of the date of this decision.
No award of costs is made.
REASONS FOR DECISION
This matter concerns a request for an extension of time to file evidence in answer and is determined under regulation 5.9 of the Patents Regulations as amended on 15 April 2013 by the Intellectual Property Legislation Amendment (Raising the Bar) Regulation 2013 (No 1).
Background
This matter relates to patent application 2011200045 in the name of Osmose New Zealand (the Applicant). The application was advertised as accepted on 22 August 2013 and a notice of opposition to the grant of a patent was filed by Arch Wood Protection Pty Ltd (The Opponent) on 21 November 2013.
The Opponent filed a statement of grounds and particulars on 21 February 2014. On 21 May 2014 the Opponent filed: an application to amend the Statement of Grounds and Particulars, evidence in support, and a request for an extension of time to file more evidence in support. On 16 June 2014 the request for an extension of time was refused and the Applicant was notified that the evidence in support was complete.
Evidence in answer was due to be filed by 16 September 2014. On the 16 September 2014 the Applicant filed the following as Evidence in Answer:
- First Affidavit of Stephen James Crimp
- Confidential (Second) Affidavit of Stephen James Crimp
- Affidavit of Terry Smith
- First Affidavit of Michael Powell
- Second Affidavit of Michael Powell
On 16 September 2014 the Applicant requested that the second affidavit of Stephen Crimp not be open for public inspection. On 17 September 2014 the Deputy Commissioner made an interim direction that the second Crimp affidavit would not be OPI until the request under regulation 4.3(2)(b) had been decided.
On 24 September 2014 the Deputy Commissioner informed the Applicant that he intended to refuse the regulation 4.3(2)(b) request and the Applicant was given 14 days to provide further submissions in relation to the decision. On 8 October 2014 the Applicant requested that the second affidavit of Stephen Crimp be withdrawn and replaced with another affidavit of Stephen Crimp.
The Applicant’s request to withdraw the second Crimp affidavit was not possible – once a document has been filed it cannot be unfiled or withdrawn. For this reason parties are strongly encouraged to make a request under Regulation 4.3(2)(b) before the document is actually filed (see Official Notice issued on 27 August 2014).
In response to the Applicant’s request to withdraw the second Crimp affidavit, on 9 October 2014 the Deputy Commissioner made the following direction:
“I, Philip Spann, Deputy Commissioner of Patents, direct that under Regulation 4.3(2)(b) the document titled Confidential (Second) Affidavit of Stephen James Crimp filed by AJ Park on 16th September 2014 should not be open to public inspection, provided that is not relied upon as evidence by the applicant in the opposition to grant of application number 2011200045”
As a result of this direction, there were two options for the Applicant:
- The document is kept confidential if the document is not relied upon used as evidence in the opposition
- The document is OPI if the document is relied upon as evidence
The Applicant chose to keep the document confidential and not rely upon it in the opposition.
On 13 October 2014 the Applicant made an application for extension of time to file the replacement affidavit of Stephen Crimp. On 16 October 2014 a Delegate informed the parties that the Commissioner intended to allow the extension of time. On 16 October 2014 the Opponent objected to the extension of time.
The law
On 15 April 2013, the Intellectual Property Legislation Amendment (Raising the Bar) Regulation 2013 (No 1) (the Amendment Regulation) commenced. The Amendment Regulation significantly amended the Patents Regulations (the Regulations) as they apply to patent oppositions. The law governing extensions of time to file evidence in a patent opposition depends upon the date on which the opposition commenced. Where the evidentiary period commenced on or after 15 April 2013 (as in the present case), the extension is governed by regulation 5.9 of the Regulations as in force on 15 April 2013. This follows from regulation 23.36(2), item 2, of the Regulations. Consequently, this matter is determined under the Regulations as amended on 15 April 2013.
Subregulation 5.9(2) states:
The Commissioner may extend the period only if the Commissioner is satisfied that:
(a) the party who intended to file evidence in the period:
(i)has made all reasonable efforts to comply with all relevant filing requirements under this Chapter; and
(ii)despite acting promptly and diligently at all times to ensure the appropriate evidence is filed within the period, is unable to do so, or
(b) there are exceptional circumstances that warrant the extension.
Exceptional circumstances are defined in subregulation (5):
In this regulation:
exceptional circumstances includes the following:
(a) a circumstance beyond the control of a party that prevents the party from complying with a filing requirement under this Chapter;
(b) an error or omission by the Commissioner that prevents a party from complying with a filing requirement under this Chapter;
(c) an order of a court, or a direction by the Commissioner, that the opposition be stayed pending the completion of a related proceeding or action under the Act.
These provisions have been considered by the Commissioner in TRED Design Pty Ltd v Julie-Anne McCarthy and Bradley McCarthy [2013] APO 57 (the TRED decision) and Merial Limited v Novartis AG [2013] APO 65 (the Merial decision). The principles applied in those decisions, which I accept as correct, are that I must ask myself the following questions:
1. Has the party (and their attorney or agent) made all reasonable efforts to comply with all relevant filing requirements?
2. Was the failure to file the evidence in time despite the party (and their attorney or agent) acting promptly and diligently at all times to ensure the evidence is filed in time?
3. Were there exceptional circumstances that warrant the extension?
As noted in the Explanatory Statement accompanying the Amendment Regulation:
"The Commissioner will not be able to extend time periods unless one of these conditions was made out. The party seeking the extension will bear the onus of convincing the Commissioner of this. Once the conditions in subregulation 5.9(2) are met, the Commissioner still has the discretion to consider whether or not it is appropriate that an extension of time be granted. In applying the test, the Commissioner will not be required to give a direction to extend a period solely because of delays caused by a legal representative failing to act promptly or diligently, by difficulties in obtaining expert evidence that could have been anticipated and acted on or by attempts to settle the proceedings.
Where a party cannot satisfy the Commissioner that an extension is justified under the test, the Commissioner will not have the power to give a short extension to allow the filing of evidence immediately available or to validate evidence filed out of time."
If the Commissioner is satisfied that an extension is appropriate, the Commissioner must then determine the length of the extension (subregulation (3)):
The Commissioner must determine the length of the extended period having regard to what is reasonable in the circumstances.
The application for extension of time
18. The Applicant’s extension of time filed 13 October 2014 was as follows:
“The circumstances and grounds upon which the application made are as follows:
The applicant filed evidence on 16 September 2014 as follows.
• Affidavit of Steve Crimp
• Confidential (second) affidavit of Steve Crimp
• Affidavit of Terry Smith
• Affidavit of Michael Powell
• Second affidavit of Michael Powell
Each of the above affidavits was filed within the evidence deadline of 16 September 2014.
The applicant requested that the Confidential (second) affidavit of Steve Crimp not be open for public inspection.
This request was declined in the decision of 24 September 2014 and the applicant filed a reply on 8 October, within the deadline set to reply, providing the replacement affidavit of Steve Crimp in which the sales information has been removed. The remainder of the affidavit is as filed on 16 September 2014.
Between the decision of 24 September 2014 and the reply filed on 8 October (10 working days), we met with our client to discuss the issues around the data in the affidavit of Steve Crimp and its sensitivities. Steve Crimp, the General Manager of Osmose New Zealand organised a meeting with, and discussed the issues with, Elias Akle the General Manager of Osmose Australia.
Following these discussions a decision was then made to allow publication of the Australian sales information and withdraw the New Zealand sales information. We then proceeded to revise the affidavit of Steve Crimp, have it executed, and then filed it with IP Australia on 8 October 2014.
The applicant has made all reasonable efforts to comply with all relevant filing requirements, and has acted promptly and diligently at all times.”
The Applicant states at paragraph 20 of their submissions:
“For completeness the timeline of evidence preparation is given in detail for the entire evidence period below.
·From 16 June 2014 till 11 July 2014 the applicant reviewed the 22 prior art documents filed by the opponent producing a detailed claims/prior art chart and reviewed all of the evidence filed by the opponent. The applicant also initiated a search for appropriate experts which was made difficult by the fact that most people working in this area have a connection with industry, including the opponent. The applicant identified Michael Powell in late June, and once the applicant had reviewed his CV (along with other potential experts) initiated evidence preparation with him on 15 July 2014.
·From 15 July 2014 through to mid August the applicant prepared draft affidavits of Terry Smith and Steve Crimp. Also prepared was the affidavit of Michael Powell, which took longer than expected as this was his first experience as an expert in patent proceedings and so required a greater degree of explanation on his role as an expert and the information required from him. In this period the applicant also reviewed all of the material filed on the opposition proceedings against the corresponding NZ patent. The staff that had been involved in the NZ proceedings are no longer with AJ Park. Given the amount of material filed in the NZ opposition proceedings this took a long time to work through (about five days of work dispersed over about 2 weeks) and also included making contact and talking to the staff that had been involved in those proceedings (one has moved to the independent bar, and the other retired).
·From mid August to 16 September 2014 the applicant finalised the affidavits of Steve Crimp and Terry Smith and begun the preparation of the second affidavit of Michael Powell. This period involved an intensive period of consultation with each of the above with daily phone calls and emails.
·Once the bulk of the evidence had been prepared, and the theory of the case developed, the applicant determined that the provision of sales information would be helpful. The applicant then prepared the second confidential affidavit of Steve Crimp from early September which required the applicant (Steve Crimp) to research and put together the sales information from the NZ and Australian businesses. This required consultation with Osmose Australia.”
Has the Applicant made all reasonable efforts to comply with all relevant filing requirements?
In this case, I consider that the reasonableness of the Applicant’s behaviour is best understood by analysing whether they acted promptly and diligently (in the following paragraphs).
Was the failure to file the evidence despite acting promptly and diligently?
The Opponent argues that the Applicant was not prompt and diligent at all times. With particular reference to the preparation of the sales information the Opponent argued:
“Even a cursory review of Arch’s evidence would make it clear that one of the grounds upon which this case is to be contested is inventive step. If inventive step is being contested – and if you have a commercial product embodying the invention that you believe to be relatively successful, wouldn’t the submission of sales data as a means of demonstrating commercial success be an immediate thought? There is no reason why such data – particularly if they were to be asserted to be confidential, should wait until the last minute; it almost seems like an afterthought with no reasonable explanation given for the “last minute” nature of this evidence.”
The reason for this evidence being prepared at this stage of the evidentiary period was given in the Applicant’s submissions:
“Once the bulk of the evidence had been prepared, and the theory of the case developed, the applicant determined that the provision of sales information would be helpful.”
The Applicant further explains the timing of the sales data in their further submissions:
“A party may not be aware of whether sales data is appropriate to file until most of the expert evidence has been prepared, since it is only at this point that the theory of the case becomes apparent. This necessarily places the party at the end of the evidentiary period.”
The Opponent has argued that the preparation of sales data should have begun much earlier in the evidentiary period. The Opponent’s approach seeks to isolate particular instances where actions could have been done sooner, rather than considering as a whole whether the Applicant was prompt and diligent at all times over the entire evidentiary period. I consider the timeline of evidence preparation provided in the Applicant’s submissions supports the assertion that they were prompt and diligent at all times.
Another indication that the Applicant was prompt and diligent at all times is that the evidence was essentially filed within the evidentiary period. The Applicant’s attempt to complete the filing of evidence was foiled by their concurrent application to keep one piece of evidence confidential and the Commissioner’s consequential directions.
The Rio Tinto Alcan International Limited v Norsk Hydro ASA [2014] APO 70 (the Rio Tinto decision) considered the situation where an application under Regulation 4.3(2)(b) was the reason an extension of time was needed. In that decision the Deputy Commissioner noted:
“Together with the information provided in its submissions … I consider that [the party seeking the extension of time] has been reasonably diligent in the preparation of evidence given its concerns about confidentiality and the need to have that matter resolved.
Had it been apparent that [the party seeking the extension of time] had delayed raising the matter of confidentiality or pursued it unreasonably this this would not be the case. However there has not been undue delay and I allow some latitude given that the application of the Commissioner’s powers under amended r 4.3(2)(b) to particular factual circumstances must necessarily be uncertain until cases of this nature are decided.”
27. Although it is arguable that a request under regulation 4.3(2)(b) should have been made earlier than the last day of the evidentiary period, I can see no significant delay in this action – the Applicant had, at most, two weeks from beginning preparation of the sales data to file this request. This approach in considering the timing of a request under regulation 4.3(2)(b) is consistent with that taken in the Rio Tinto decision.
I accept the Applicant’s explanation of why they began preparing the evidence comprising sales data relatively late in the evidentiary period. I also accept that the preparation of sales data took the remaining time in the evidentiary period. I also accept that there was no significant delay in filing a request under regulation 4.3(2)(b).
Overall, I am satisfied that the Applicant was prompt and diligent at all times. Consequently it follows that the Applicant made all reasonable efforts to comply with all relevant filing requirements.
Exceptional circumstances
It is unnecessary to determine whether there are exceptional circumstances under 5.9(2)(b), as I have already determined the criteria of 5.9(2)(a) have been satisfied.
Discretionary matters
Once the mandatory requirements of paragraphs 5.9(2)(a) or 5.9(2)(b) have been met, an extension is not automatic. The Commissioner "may" extend the period for filing evidence. I can see no reason not to exercise the discretion.
Conclusion
I am satisfied that an extension of time is appropriate.
Finally, I need to consider what length of extension is reasonable in the circumstances. The replacement Crimp affidavit was filed on 8 October 2014. I consider it is reasonable to extend the time until that date.
This decision provides notification to the Opponent that all evidence in answer has been filed as required under regulation 5.8(4)(b). The Opponent now must file any evidence in reply within 2 months of the date of this decision.
Costs
35. Some of the information which established that the Applicant was prompt and diligent at all times was only made in the Applicant’s submissions to the hearing rather than in their application for an extension of time where this information should have been provided. In view of this, the Opponent was justified in objecting to the extension of time. As such I think it is appropriate that each party bear its own costs. Accordingly, I make no award of costs.
Xavier Gisz
Delegate of the Commissioner of Patents
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