BASF Corporation v ICI Australia Operations Proprietary Limited

[1988] APO 27

In the Matter of the Patents Act 1952 - and - In the Matter of Application No. 561757 for a Patent by BASF CORPORATION - and - In the Matter of Opposition thereto by ICI AUSTRALIA OPERATIONS PROPRIETARY LIMITED - and - In the Matter of an Application for Extension of Time within which to Serve Evidence in Support.

 

DECISION OF A SUPERVISING EXAMINER OF PATENTS:

Background

Patent application 561757 for an invention entitled "Pearlescent Automotive Paint Compositions" was advertised accepted in the Official Journal of Patents on 14 May, 1987. ICI lodged notice of opposition to the grant of a patent on the application on 10 November, 1987 after gaining an extension of time to do so, and thus evidence in support was due by 10 February, 1988.

ICI has been granted two unopposed extensions of time in which to serve its evidence in support - such extensions firstly extended the time to 10 May, 1988 and secondly to 10 August, 1988.

On 9 August, 1988, a third extension of time was sought to extend the period for lodging evidence for a further period of 1 month (viz. until 10 September, 1988). The applicant BASF notified the Commissioner that it objected to the extension being granted, and the matter was set down for hearing. The hearing was held in Canberra on 5 September, 1988 with Mr. J. Christiansen, patent attorney of Sandercock Smith & Beadle, Melbourne representing the patent applicant and Mr. J. McStea, patent attorney of ICI's Industrial Property Section representing the opponent.

The Application for Extension

The circumstances and grounds given in the present application for extension of time are as follows:

"Important evidence from an overseas source is not yet available and as a result the evidence in support is not yet complete. Further time is needed to obtain this evidence and to incorporate it into the otherwise complete evidence in support."

I note that on the same day as the above extension application was lodged, the opponent lodged two statutory declarations which constituted part of its evidence in support of the opposition. I understand the evidence can be completed once the overseas evidence referred to in the application for extension is received and incorporated in a suitable declaration.

Submissions

In support of ICI's extension of time request, Mr. McStea provided a brief review of the subject matter of the patent application in suit and ICI's progress in the time already Allowed to prepare and serve its evidence. His submission included the following points:

(a) The paint division of the opponent, Dulux Australia (DULUX), had experimented with and tested paint compositions containing pearlescent pigments from at least the early 1970's, soon after pearlescent pigments first became available fromm raw material manufacturers. These manufacturers were in overseas countries and supplies came to DULUX through agents in Australia.

(b) At an early stage in its efforts to assemble opposition evidence, ICI realised there was little patent literature or published articles available concerning this particular technology, and therefore a study of relevant trade literature together with research data was needed in order to assemble relevant evidence for the opposition. Consequently DULUX's research work books, and trade literature from both DULUX and raw material suppliers were studied.

(c) Approaches were also made to the agents for the raw material suppliers for parameter data on the pearlescent pigments since the trade literature available to DULUX, on inspection, failed to reveal these details. Dupont in Australia was approached for this purpose but little information was obtained since the Dupont company had not supplied pearlescent pigments worldwide for more than 10 years having passed the technology rights to other companies. Dupont in the USA was then approached but had never responded.

(d) During the first extension period, a current manufacturer and supplier based in USA, The Mearl Corporation, was approached for assistance in the matter and, after some delay, responded that assistance may be available if the nature of the details wanted were known. On being supplied with the details sought, Mearl were unable to easily locate details of the pigment parameters or samples relating to its products of some 10 years ago. The second extension of time was obtained to enable Mearl to further research ICI's request for details.

(e) Late in the second extension period, ICI became aware that Mearl had been able to locate relevant information and that a declaration would be forthcoming, but as the extended period was about to expire ICI decided to apply for a further one month extension of time, in which time it believed the overseas information would be at hand and could be incorporated into its main evidence for the opposition. (Mr. McStea indicated he had received the overseas material a day after lodging the latest extension of time request.) (f) The delay in finalising ICI's evidence in support had arisen from a combination of factors including the particular technology involved, the type of parameters being sought, and the reliance on parties overseas to locate and provide relevant details of pigments it had supplied to the trade.

(g) Given its previous involvement in the particular field of the invention, ICI believed its paint production interests, as well as that of other manufacturers, would be unduly hampered if the application matured to a patent. Thus it was not only in the opponent's interest but the public interest that the application be fully reviewed before grant.

Mr. Christiansen's submissions on behalf of the patent applicant included the following points:

(h) Much of Mr. McStea's submission could be discounted since the issue to consider is whether the present extension sought is justified.

(i) Some delays were occasioned by the opponent or its affiliated companies and thus were not matters beyond the control of the opponent.

(j) Whilst the public interest factor was a consideration in deciding whether or not to grant the extension, it was submitted that the delays already experienced here meant that the patent applicant's interests outweighed the situation where the public interest predominated especially as the evidence from overseas may not be relevant in this country.

(k) A comparison of the three extension of time applications displayed certain inconsistencies - the first mooted no .overseas material being sought, the second referred to obtaining "relevant information from overseas" the current application refers to "important evidence from an overseas source". ICI's endeavours suggested a "fishing expedition" for evidence.

(l) The applicant believes its interests are being eroded as the evidence process drags on and in fact the applicant advised the opponent in early July 1988 that further extensions would be objected to.

Decision

In deciding whether an extension of time should be allowed, the Commissioner:

(i) must be satisfied that an applicant who seeks such an extension has made out a proper case justifying the extension; and

(ii) must consider not only the respective interests of applicants and opponents, but also those of the public by ensuring that worthless patents are not granted and that there are no unreasonable delays in the proceedings.

Furthermore in matters such as this, the onus rests on the applicant for the extension of time to establish its case.

As to the first consideration, Mr. McStea's review of the technology of the patent application in suit and the efforts pursued by ICI in the time so far available to both research details concerning the materials that DULUX had previously tested and to assemble its evidence, suggest to me that ICI is serious in its opposition action and its endeavours to finalise its evidence in the matter. In reality, I do not think that ICI has been "fishing" for evidence - it seems to me that from about the time of lodging notice of opposition, ICI has sought to use in its opposition evidence information concerning pearlescent pigments, which pigments had been freely supplied to DULUX, and probably other paint manufacturers, in the early 1970's. It found, however, that a source for that information proved harder to locate than perhaps first anticipated. The previously extended period to 10 August, 1988, had enabled Mearl time to fully investigate its records for the parameter data sought, and having been advised that material was forthcoming from overseas and with the evidence period due to expire, ICI had sought the present further one month extension of time. ICI had been dependent on Mearl, the only source it could locate to assist, for the provision of information it wanted, and Mearl simply had difficulty in locating the material in timely fashion. Furthermore, Mr. McStea indicated that the overseas information was indeed very relevant to what had happened in Australia, and from this I infer it could be utilised in ICI's opposition evidence. In the circumstances, I am satisfied that ICI has made out a proper case justifying the extension sought.

I turn now to the second consideration concerning the interests of the parties and the public interest aspect. Both parties have provided submissions in respect of their respective interests and in my view these have equal merit. As to the public interest, whilst there has been delay in the proceedings I do not consider this can be considered unreasonable in the circumstances given the sort of factors mentioned in paragraph (f) earlier. Additionally, the public interest would be well served if any doubt concerning the validity of the patent if granted on the application could be fully considered in pre-grant opposition. Overall, I do not consider that the patent applicant's interests are presently of such moment as to outweigh the other interest factors. The circumstances in this case, I believe, are somewhat different to those prevailing in Baxter Travenol Laboratories Inc. v. Cutter Laboratories Inc. 9 IPR 36; (1987) AIPC 90-407, a case referred to by Mr. Christiansen at the hearing. In that case, the extension of time sought was refused against the background circumstances of no indication that evidence in support was under preparation, no firm information that the opponent was engaged in a serious opposition, nothing to suggest that a patent granted on the application in-suit would be invalid, and of appreciable delay in the proceedings.

Accordingly I grant the extension of time sought. The time within which evidence in support may now be served is thus extended to.10 September, 1988.

Costs

On the question of costs, Mr. Christiansen submitted that in the event that the extension be granted, costs ought to be awarded against the opponent since the full basis for the extension only emerged at the hearing. For his part, Mr. McStea submitted that in the event that the extension be granted, the parties should bear their own costs. The usual practice is that costs follow the event, but in actions such as this, variations to that practice have been considered appropriate where the successful party has been seen as contributing to the action (see for example the decisions in Nautical Services Pty Ltd v. Hitech Distillation (Australia) Pty. Ltd. 7 IPR 567, and Roussel-Uclaf v. Shell International Research Maatschappii_B.V. 9 IPR 475; (1987) AIPC 90-418.) In this case, the reasons given on the application for extension of time stated in general terms the actual grounds for the extension which were more fully detailed at the hearing. Had the reasons on the application itself been somewhat more detailed, it is conceivable that the patent applicant may not have objected notwithstanding its earlier advice to the opponent of its intention to oppose further extension requests. Consequently, in these circumstances, I consider it is appropriate that the parties bear their own costs.

(T. R. Bruhn)Supervising Examiner of Patents

12 SEP 1988

Patent Attorneys for the patent applicant: Sandercock Smith & Beadle

Patent Attorney for the opponent J.A. McStea