BP International Limited v Neste Oil Oyj - [2011] APO 69

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
BP International Limited v Neste Oil Oyj [2011] APO 69

Patent Application: 2003258753

Title:Diesel fuel composition, comprising components based on biological raw material, obtained by hydrogenating and decomposition fatty acids

Patent Applicant:  Neste Oil Oyj
Opponent:  BP International Limited
Delegate:  Dr B. Akhurst
Decision Date:  30 August 2011
Hearing Date:  Written submissions filed by BP on 21 June and 1 August 2011, and by Neste on 1 July 2011.

Catchwords: PATENTS - subregulation 5.10(2) - request for an extension of time to serve evidence in answer - the balance of interests support the extension - extension of time allowed.

Representation: Patent applicant: John Carroll, Principal patent attorney at Callinans, Hartwell.
Opponent: Andrew Davey, Senior Associate patent attorney at Griffith Hack, Melbourne.

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2003258753

Title:Diesel fuel composition, comprising components based on biological raw material, obtained by hydrogenating and decomposition fatty acids

Patent Applicant: Neste Oil Oyj
Date of Decision: 30 August 2011
DECISION
I allow Neste an extension of time until 10 September 2011 to serve evidence in answer. Costs are awarded against BP.
REASONS FOR DECISION
Background

Patent application 20036258753 in the name of Neste Oil Oyj was filed on 4 September 2003 under the provisions of the PCT, and became open for public inspection in Australia on 29 March 2004. Examination was requested on 9 February 2007 and acceptance advertised on 4 December 2008.
On 4 March 2009, BP International Limited (‘BP’) served a notice of opposition to grant of a patent for application 2003258753 under section 59 of the Patents Act 1990, followed by a statement of grounds and particulars on 28 May 2009. Service of evidence in support was completed by BP on 10 September 2010 after five extensions of time were granted under regulation 5.10.
By way of applications on 9 December 2010 and 10 March 2011, Neste Oil Oyj (‘Neste’) extended the time under regulation 5.10 for filing evidence in answer to 10 June 2011. On 10 June 2011, Neste filed an extension request for a further three months, to which BP on 21 June 2011 objected and requested a hearing.
On 30 June 2011, the delegate advised the parties that that the hearing could be based on written submissions. The parties were invited to file written submissions within 14 days of the date of the letter, and any responding submissions within a further 7 days. Neste filed submissions on 1 July 2011. On 7 July 2011, BP advised they wished to rely on their written submission filed with the objection on 21 June 2011. Only BP filed responding submissions, which were received on 1 August 2011.
The law on extensions of time
The time for serving evidence can be extended under subregulation 5.10(2) of the Patents Regulation 1991 which provides that:
(2) The Commissioner may extend the time within which the party may take a step prescribed in this Chapter (not being a step that is taken under regulation 5.3 or 5.3AA, paragraph 5.4(a), subparagraph 5.8(1)(a)(i) or regulation 5.9A):
(a) on the application of a party in the approved form; and
(b) on such reasonable terms (if any) as the Commissioner specifies; and
(c) after the party has served a copy of the application on the other party.
The above provision must be read in conjunction with subregulation 5.10(5) which provides that:
(5) The Commissioner must not … grant an application under subregulation (2) … unless the Commissioner:
(a) if he or she proposes to grant an application by a party - is reasonably satisfied that the other party has been notified of the application; …
(b) …; and
(c) … :
(i) gives the parties a reasonable opportunity to make representations concerning the application or proposed action; and
(ii) is reasonably satisfied that a direction, an extension of time or the serving of evidence is appropriate in all the circumstances.
An extension can only be granted if the Commissioner is reasonably satisfied that it is appropriate in all the circumstances. In exercising this discretion, I am guided by the decisions of Burchett J in Ferocem Pty Ltd v Commissioner of Patents [1994] FCA 981; 28 IPR 243, Sackville J in A Goninan & Co Ltd v Commissioner of Patents [1997] FCA 424; 38 IPR 213 and Goldberg J in National Starch & Chemical Co v Commissioner of Patents [2001] FCA 33; 50 IPR 398. The general principles that flow from these decisions are that:
a)The power is discretionary: Regulation 5.10 confers a broad discretion, which cannot be reduced to imperative compliance with particular requirements. It is necessary to give genuine and proper consideration to all relevant considerations. (Ferocem IPR at 247-8, Goninan IPR at 220)
b)Explanation of delay: The reasons why the evidence was not served earlier are a relevant consideration, but a satisfactory explanation is not a mandatory requirement. (Ferocem IPR at 247).
c)The public interest: The public interest in determining a serious opposition on its merits is a relevant consideration (Goninan IPR at 222). It is necessary for the Commissioner to form a view as to the nature of the evidence that it is sought to adduce, and the significance of that evidence for the opposition proceedings (Goninan IPR at 225-6). The significance of the evidence is assessed having regard to any relevant material available, not just the evidence itself (National Starch at [33]). The public interest is not protected merely because some evidence has already been served (Goninan IPR at 225).
d)The interests of the parties: The interests of the party seeking the exercise of discretion are a relevant consideration. (Ferocem IPR at 247). It is also relevant to consider the disadvantage to the other party of delays in determining the opposition, and the effect of delays on the efficient and orderly administration of the Patent Office. (Ferocem IPR at 247, Goninan IPR at 222).
The application for an extension of time
Neste’s reasons for the extension request were stated as follows:
“Preparation of the evidence-in-answer in the opposition is progressing, however further time is required to complete the evidence-in-answer. There have been ongoing difficulties with finalising the declarations due to ongoing project commitments of the patent applicant’s researchers and their outside technical expert.
The researchers of the applicant have been extremely busy with other projects up until recently. The researchers are presently finalising their evidence with a view to finalising, settling and serving their evidence-in-answer by the extended deadline.
The outside technical expert remains difficult to contact slowing the progress of his evidence. We understand the expert has numerous overseas travel commitments. He is currently or will shortly be in Papua New Guinea for an extended period of time and in general will be uncontactable for this month. He is expected to return to Australia before the end of the deadline, if extended. It is expected that he should be able to finalise and serve his evidence-in-answer by the extended deadline.”
The Commissioner must ensure that the other party has been notified of the extension request, and that both parties have had the opportunity to make representations. In the present case, BP has been notified, and both parties have been given the opportunity to make representations.
Explanation of the delay
The reasons for the delay, identified in Neste’s extension request, can be summarised as follows:
(i) further time is needed to complete the declarations of Neste’s researchers who have been busy with project commitments, and
(ii) there has been difficulty in contacting an independent technical expert due to his numerous overseas travel commitments.
I note that Neste’s submissions of 1 July 2011 state that the independent expert referred to in its extension request advised that as of 27 June 2011 he would be unable to assist further. However, Neste submit that it is now involving alternative experts and expects to have its evidence completed by 10 September 2010 if the deadline is extended.
BP submitted that Neste have not provided any reasonable or detailed statements as to why they have not been able to complete the evidence in answer, other than that their researchers have been busy with other projects and that the outside technical expert remains difficult to contact.

Neste have had 9 months in which to file evidence in answer. From the extension request, the evidence of Neste’s researchers has been delayed because they have been “extremely busy with other projects”. In addition Neste were waiting for the outside technical expert to return to Australia to finalise his evidence, and this expert has now withdrawn his assistance. I accept that Neste’s difficulties with the independent expert at least, and the need to find a replacement, would have delayed preparation of their evidence.
I am satisfied that Neste have provided a satisfactory explanation of the delay.
The public interest
In determining the public interest, the expeditious resolution of the disagreement between the parties must be balanced with the need to determine the opposition on its merits. The public interest in determining a serious opposition on its merits is assessed by considering the nature and significance of the evidence that will be served (Goninan IPR at 225-6).
In the present case, Neste have provided no information on the nature and significance of its evidence. The technology relates to a fuel composition for diesel engines. The statement of grounds and particulars identifies the grounds of opposition as manner of manufacture, novelty, inventive step and section 40 issues. Since no evidence has yet been served by Neste in answer, it is not clear what the nature and significance of the expert evidence might be in the context of this opposition. However, I would note that any evidence, as opposed to no evidence, is likely to be important to the opposition process, in allowing Neste to more effectively argue the merits of its case. Therefore, I am satisfied that the public interest in this case favours the grant of an extension of time.
The interests of Neste
Neste submitted that their rights would be unduly prejudiced were their application to be refused, as it would prevent the patent applicant from being able to file evidence in defence of their application. Since no evidence in answer has yet been served, Neste would be completely shut out from properly defending the application if the extension is refused. Clearly Neste have a strong interest in the application being allowed.
The interests of BP and the Patent Office
The interests of BP lie in having the opposition dealt with expeditiously, and as a consequence lie against allowing the extension. The Patent Office has an interest in the orderly processing of oppositions.

BP submitted that it is to Neste’s advantage that the opposition be delayed as it lengthens the time the application remains pending and therefore the time during which there is uncertainty for third parties over the scope of the monopoly claimed by Neste. However, while granting the extension will create further delay, if the extension is refused it is probable that Neste would be forced to rely on its divisional filed on 26 February 2010, thus protracting the matter by years rather than months.
The balance of considerations
The power to grant an extension of time under regulation 5.10(2) is discretionary. The discretion is guided by regulation 5.10(5)(c)(ii) which requires that the Commissioner not grant an extension of time unless reasonably satisfied that the extension is appropriate in all circumstances.
In this case, Neste have provided a reasonable explanation for the delay. The public interest and the interests of Neste support the grant of an extension of time in this case. BP’s interests are against the extension. However, Neste have indicated that it expects to complete the service of evidence in answer within the requested timeframe. On balance, it is appropriate to grant the extension.
Conclusion

22. I am satisfied that the extension of time is appropriate in all the circumstances. I grant the extension of time for serving evidence in answer until 10 September 2011.
Costs
23. It is normal practice for costs to follow the event. In the present case, I can see no reason to depart from the normal practice. I award costs according to Schedule 8 against BP.
Barbara Akhurst
Delegate of the Commissioner of Patents