Cadbury Schweppes PLC v Wm. Wrigley Jr. Company
[2007] APO 20
•22 June 2007
ABSTRACTS OF DECISIONS
DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS
Application : No. 2002219968 in the name of Wm. Wrigley Jr. Company
Title: Encapsulated Acid Mixtures and Products including same
Action: Objection to an application for an extension of time in which to serve evidence in support (regulation 5.10(2)) of Opposition by Cadbury Schweppes PLC under section 59 (Patents Act 1990).
Decision: Issued 22 June 2007
Abstract
A serious opposition is foreshadowed, the circumstances presented in the instant fifth application for extension of time clearly demonstrate that evidence in support is now being diligently pursued, further time is needed to finalise evidence relevant to the substantive grounds of opposition particularised in the Statement of Grounds and Particulars. It was noted that the opponent was considered to have previously not acted diligently in progressing evidence in support, a circumstance considered by the Commissioner in granting the fourth extension of time. It was concluded that the extension of time was clearly appropriate upon consideration of all circumstances relevant to the opponent’s fifth application for extension of time. At this stage of the proceedings, the opponent’s and public’s interests in having the opposition proceed on its merits holds sway over the patent applicant’s and public’s interests in having the matter decided earlier.
The extension of time to 30 May 2007 for Cadbury Schweppes PLC to serve evidence in support is granted.
PATENTS ACT 1990
DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS
Re:Patent Application No. 2002219968 by Wm. Wrigley Jr. Company and Opposition thereto by Cadbury Schweppes PLC under Section 59 of the Patents Act 1990. Objection to an application for an extension of time in which to serve evidence in support (regulation 5.10(2)).
BACKGROUND
Patent application 2002219968 was filed by Wm. Wrigley Jr. Company (‘Wrigley’) on 30 November 2001 claiming priority of 15 December 2000. The application was advertised accepted on 28 July 2005.
Cadbury Schweppes PLC (‘Cadbury’) filed a Notice of Opposition to the application on 28 October 2005, followed by its Statement of Grounds and Particulars on 30 January 2006.
Cadbury’s evidence in support of its opposition was required to be served by 30 April 2006 under regulation 5.8(1). Cadbury has had four previous extensions of time to serve evidence in support granted by the Commissioner, extending the required date of service by 11 months to 30 March 2007. Cadbury’s instant fifth application for extension of time would extend the time to serve evidence in support by a further 2 months to 30 May 2007.
On 2 May 2006, Cadbury served a Statutory Declaration by Rosaria Stramandinoli and Exhibits RS-1 to RS-14 as part of its evidence in support, being copies of documents mentioned in the Statement of Grounds and Particulars.
In response to the fourth application for extension of time by Cadbury, Wrigley served notice by way of letter dated 29 January 2007 that it believed that the reasons provided in the application were inadequate to justify the extension and that it reserved its right to formally object to any further application for extension of time.
On 13 April 2007, Wrigley filed an objection to the grant of the instant fifth application for extension of time and requested to be heard on the matter.
The matter was heard in Canberra on 30 April 2007. Wm. Wrigley Jr. Company was represented by Andrew Lee and Martin O’Brien, Attorneys of Spruson and Ferguson, Sydney. Cadbury Schweppes PLC was represented by Ben Fitzpatrick, Counsel, and Christine Emmanuel, Attorney of Griffith Hack, Melbourne. Both parties appeared by telephone.
The application for extension of time
In support of its first application for extension of time of 3 months from 30 April 2006 in which to serve evidence in support of its opposition, Cadbury explained that it has been progressing evidence in support by locating citable art, obtaining evidence of publication of the cited art, deriving a list of 10 potential experts to provide expert evidence and continuing enquiries regarding any expert in Australia.
In support of its second application for extension of time of 3 months from 30 July 2006, Cadbury explained that it had narrowed its list of potential experts to ‘one main candidate’, tried to arrange to meet with the expert in the US in July 2006 to take ‘evidence for this and other oppositions against Wrigley patent applications in similar fields’, tentatively rescheduled to meet with the expert in the US in September 2006 and was spending less time on seeking an expert in Australia.
In support of its third application for extension of time of 2 months from 30 October 2006, Cadbury explained that it had learned that the expert was not available about 2 weeks prior to the scheduled September 2006 meeting, it ‘will be instructing our Australian attorneys to meet with the expert when an appropriate meeting time can be found, given the busy schedule of the expert’ and now merely keeping ‘eyes open’ for an expert in Australia.
In support of its fourth application for extension of time of 3 months from 30 December 2006, Cadbury explained that it has not been able to arrange a meeting with a Japan resident expert, it will be having a video conference with the expert in early January 2007 to progress evidence for ‘this opposition and two other oppositions’, the video conference will have the planned structure as detailed, it has conducted further research into documents to establish common general knowledge in the meantime and it has identified 2 possible experts in Australia on, more generally, food acids & encapsulated acids in general confectionery.
In support of its instant fifth application for extension of time of 2 months from 30 March 2007, Cadbury explained the circumstances in a statutory declaration by Janelle Borham, being
· there have been about 10 other oppositions in train with Wrigleys, which is now reduced to 3
· on 5 January 2007, a telephone conference was held with Mr. Rikiya Kuwahara to obtain information before he was exposed to a copy of the opposed specification, having initially tried to organise a meeting in person for the 3 oppositions
· it became evident that 3 experts in the US would continue to be too busy with US litigation
· another expert in the US was rejected because of ‘cost reasons’
· in the telephone conference, another opposition was first dealt with
· the telephone conference had a planned structure as detailed
· the telephone conference also discussed the technical background of two other Wrigley patent applications
· at the end of the telephone conference, Mr Kuwahara was provided with copies of three opposed patent specifications for comment at a second telephone conference
· the second telephone conference has occurred and are now close to completion of a statutory declaration by Mr. Kuwahara
· the prior art has been provided to Mr. Kuwahara and a further telephone conference has been set for 11 April 2007
· expert comment is needed in support of substantive grounds of opposition particularised in the Statement of Grounds and Particulars, including to clarify differences in technical terminology
· Mr. Kuwahara’s evidence is expected to be completed in the period applied for
· relevant experts are not available in Australia in the field of chewing gums
· a relevant expert in Australia in general confectionery has been identified, whose evidence is also expected to be completed in the period applied for.
Submissions by the parties
In summary, Cadbury’s submissions present the circumstances declared to in the application for extension of time and provide an update to those circumstances, including by way of statutory declaration by Christine Emmanuel. As explained, a draft declaration is being prepared for Mr. Kuwahara’s signature following the telephone conference of 11 April 2007, with a further telephone conference being scheduled between May 8 and 10. The expert in Australia has been identified as Mr. Paul Truman with meetings having occurred on 20 April 2007 and scheduled for the week of 20 May 2007.
Cadbury contends that
· it is mounting a serious opposition
· it is in its and the public’s interest that the opposition be determined on its merits
· the expert evidence is necessary to determine the opposition on its merits, being directed to substantive grounds of opposition particularised in the Statement of Grounds and Particulars
· significant progress has been made
· the overall delay is relatively short in time
· Wrigley is not being unduly disadvantaged.
In summary of its submissions, Wrigley contends that
· Cadbury has not made significant progress in that no substantive evidence to substantiate the substantive grounds of the opposition have been filed in the 19 months since the Notice of Opposition was filed, and Mr Kuwahara has not even considered the opposed patent specification or the documents listed in the Statement of Grounds and Particulars, and in the previous four applications for extension of time, Cadbury failed to retain a single expert
· consequently, we can expect that Cadbury will require a sixth application for extension of time
· in its fifth application for extension of time, Cadbury seeks to rely on an Australian expert having been just retained despite having previously exhausted avenues for locating an Australian expert
· it was not until the fourth application for extension of time that Cadbury mention retaining a Japan resident expert
· the Japan resident expert has been working on other oppositions rather than devoting time to the instant opposition
· it can be inferred either that experts are not yet prepared to provide evidence supporting Cadbury’s opposition or that Cadbury is not serious in its opposition
· ‘since the opponent has not sufficiently been able to identify any relevant evidence from a relevant expert, the denial of the extension sought will not shut out any relevant evidence and thus will not prevent the opposition from being determined on its merits’
· considerable weight should be given to expeditious disposal of the matter such that is in the public interest that the extension of time not be granted
· ‘In view of the fact that ……… experts …….. were unwilling to provide evidence for this opposition leads to a conclusion that any evidence adduced by the Cadbury experts will likely have little or no significance in determining the issues of this opposition.’
DECISION
The law on extensions of time
The time for serving evidence can be extended under regulation 5.10(2):
(2) The Commissioner may:
(a) on the application of a party in the approved form; and
(b) on such reasonable terms (if any) as the Commissioner specifies: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 paragraph 5.4(1)(a).
This provision must be read in conjunction with regulation 5.10(5):
(5) The Commissioner must not give a direction under subregulation (1) or grant an application under subregulation (2) or (4) 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; and
(b)if he or she proposes to act on his own motion - ensures that the parties are notified of the proposed action; and
(c) in either case:
(i)gives the parties a reasonable opportunity to make representations concerning the application or proposed action; and
(ii)is reasonably satisfied that a direction, and extension of time or the serving of evidence is appropriate in all the circumstances.
Consequently, it is a prerequisite to any decision that the Commissioner must ensure that the other party has been notified, and that both parties have had the opportunity to make representations. These requirements have been met in the present case.
An extension can only be granted if the Commissioner is reasonably satisfied that it is appropriate. In exercising this discretion I am guided by the decisions of Burchett J in Ferocem Pty Ltd v Commissioner of Patents (1994) AIPC 91-057; 28 IPR 243, Sackville J in A Goninan & Co Ltd v Commissioner of Patents (1997) AIPC 91-330; 38 IPR 213 and Goldberg J in National Starch & Chemical Co v Commissioner of Patents (2001) AIPC 91-697, 50 IPR 398. These decisions establish 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 at AIPC 38,208; IPR 247-8, Goninan at AIPC 39,434; IPR 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 at AIPC 38,207-8; IPR 247)
c)The public interest: The public interest in determining a serious opposition on its merits is a relevant consideration. (Goninan at AIPC 39,435-6; IPR 222)
* In order to do this, 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 at AIPC 39,438; IPR 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 at AIPC 39,438; IPR 225)
d)The interests of the party seeking the exercise of discretion: The interests of the party seeking the exercise of discretion are a relevant consideration. (Ferocem at AIPC 38,208; IPR 247)
e)The interests of other parties: It is 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 Patents Office. (Ferocem at AIPC 38,208; IPR 247, Goninan at AIPC 39,436; IPR 222)
Reasons for the Extension of Time and Explanation of the delay
The circumstances presented in Cadbury’s fifth application for extension of time to serve evidence in support are consistent with its previous applications and are attested to by Janelle Borham by way of statutory declaration.
From the Borham declaration, we can determine
- Cadbury are obtaining expert evidence from Mr. Kuwahara for the 3 concurrent oppositions remaining from an original about 11 oppositions in train between Cadbury and Wrigley
- telephone conferences have occurred and are planned with Mr. Kuwahara since the beginning of the fourth extension of time period to obtain expert evidence relevant to substantive grounds of opposition particularised in the Statement of Grounds and Particulars
- the structure of the first and subsequent telephone conferences is such as to efficiently obtain relevant expert evidence while, I immediately infer from the information declared to, avoiding the concern expressed by the full Federal Court in Minnesota Mining & Manufacturing Co v TycoElectronics Pty Ltd 56 IPR 248“The manner in which the evidence of some of the experts in the present case was bought into existence suggests that relatively little weight should be given to certain of that evidence. For example, witnesses were provided with a copy of the patent. They were either provided with a large number of other documents or found them in response to the task that was set them. That is hardly calculated to result in objective evidence as to what the hypothetical uninventive but skilled worker would have done. To give the patent to a prospective witness is tantamount to leading the witness. Further, unless the other documents were part of the common general knowledge in Australia before the priority date, they are not relevant to any question of obviousness.”
- the expert evidence from Mr. Kuwahara is expected to be served within the extension period applied for
- the very late identification of an Australian resident expert in general confectionery is not expected to further delay final service of evidence in support.It seems quite apparent to me from Cadbury’s instant and previous applications for extension of time that Cadbury is mounting a serious opposition and that Cadbury has been diligent in progressing its evidence in support since the beginning of the fourth extension of time period.
In this regard, I accept Wrigley’s former inference that experts are not yet prepared to provide evidence supporting Cadbury’s opposition, rather than Cadbury not being serious in its opposition. However, as declared by Ms. Borham, the evidence in train will be put into declaratory form simply in due course and is expected to be served within the extension period applied for in support of Cadbury’s opposition.
I do not accept Wrigley’s contention that there is an unreasonable delay occasioned by the Japan resident expert working on other oppositions rather than devoting time to the instant opposition. If other experts had been available, Cadbury would have had an obligation to progress the multiple oppositions in parallel by using different experts for each. In the present circumstances of Mr. Kuwahara being the only reasonably available expert, the Commissioner cannot very well exclude the relevant circumstance of the expert’s time having to be shared between multiple actions before the Commissioner.
I consequently conclude that the reasons for, and the explanation of the circumstances of, the application for the fifth extension of time do clearly justify the fifth extension period subject to consideration of all other relevant circumstances below. However, such clear justification is not immediately apparent to me with regard to the fourth extension of time, while noting that the fourth application for extension of time has been previously determined by the Commissioner and is not part of the instant decision.
In support of Cadbury’s instant fifth application for extension of time, it has been declared that Cadbury had sought out Mr. Kuwahara because its 3 US resident experts were too busy with US litigation and a subsequent US resident expert was rejected by Cadbury on ‘cost reasons’. From Cadbury’s previous applications for extension of time, it appears that Cadbury pursued its US resident experts from prior to July 2006 until November or December 2006 before determining that they were either not available or not suitable for ‘cost reasons’.
In particular, having failed to arrange a meeting with the US resident expert in early to mid July 2006 and having had to cancel the meeting with the US resident expert in September 2006, Cadbury’s third application for extension of time reveals that a meeting had still not been arranged as at the end of October 2006. While Cadbury may have continued to diligently pursue the US resident expert throughout this period, it was encumbent on Cadbury to consider other options in taking evidence such as teleconferencing and also to resume and continue looking for more available other experts.
Cadbury’s fourth application for extension of time makes no mention of the US resident expert, but explains that a telephone conference with a Japan resident expert has been scheduled for early January 2007 following the inability to arrange a meeting in person.
Given that Cadbury were very well aware of the circumstances of its US resident experts, I consider that Cadbury did not act diligently in 2006 by not at least pursuing other potential experts at a far earlier stage in the likelihood of its US resident experts not being able to provide timely evidence. Cadbury now using Mr. Kuwahara as its expert demonstrates that such an approach was viable.
Cadbury are also prima facie remiss in rejecting a US resident expert for ‘cost reasons’ in the apparent absence of consideration of the impact of this cost avoidance on Wrigley’s interests and the public interest.
The identified lack of diligence was a relevant consideration of the Commissioner in determining Cadbury’s fourth application for extension of time, during which extension Cadbury indicated it would be pursuing evidence from its Japan resident expert. The Commissioner granted the fourth extension of time, determining that it was appropriate in all the circumstances. As I have determined above, Cadbury has since acted diligently in pursuing evidence from Mr. Kuwahara and in acting to obtain evidence from Mr. Truman within the timeframe required to obtain Mr. Kuwahara’s evidence.
The interests of the parties
Cadbury would be disadvantaged in arguing the substantive opposition if it is unable to serve its evidence in support of its substantive grounds of opposition. I see no substance in Wrigley’s superficial contention that ‘since the opponent has not sufficiently been able to identify any relevant evidence from a relevant expert, the denial of the extension sought will not shut out any relevant evidence and thus will not prevent the opposition from being determined on its merits’.
Wrigley is being disadvantaged by delayed determination of the substantive opposition and by delayed confirmation of its valid patent rights.
Because the instant application would extend the time to serve evidence in support from the statutory 3 months to 16 months, it is increasingly encumbent on Cadbury to progress evidence in support without avoidable delay that will further disadvantage Wrigley. However, at this stage of the proceedings of a serious opposition, the likely disadvantage to Cadbury of not granting the extension of time clearly outweighs the disadvantage to Wrigley of granting the extension.
The public interest and that of the Patent Office
On the one hand, the public interest is served by determining a serious opposition on its merits. On the other hand, the public interest and that of the Patent Office is served by the timely, efficient and orderly administration of the patent legislation.
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 at AIPC 39,438; IPR 225-6). As explained above in determining the reasons for the instant extension from the explanation provided by Cadbury, I have determined from the Borham declaration that Cadbury is pursuing expert evidence from Mr. Kuwuhara relevant to substantive grounds of opposition particularised in the Statement of Grounds and Particulars.
The Borham declaration explains that the expert’s comments are important to the proper determination of the opposition on its merits by way of providing an accurate understanding of the disclosures of the prior art documents and providing expert evidence on the use of food acid mixtures and encapsulation of food acids in confectionery, and in chewing gums in particular. I accept Cadbury’s contention on the relevance of the expert evidence being prepared to the proper determination of the opposition over Wrigley’s superficial contention that ‘In view of the fact that ……… experts …….. were unwilling to provide evidence for this opposition leads to a conclusion that any evidence adduced by the Cadbury experts will likely have little or no significance in determining the issues of this opposition.’
Because the instant application would extend the time to serve evidence in support from the statutory 3 months to 16 months, increasing weight should be given to the public interest, and that of the Patent Office, of the timely, efficient and orderly administration of the patent legislation. However, at this stage of the proceedings of a serious opposition, there is clearly greater public interest in having the opposition determined on its merits.
The balance of considerations
I believe that the balance of considerations regarding all circumstances relevant to Cadbury’s fifth application for extension of time to serve evidence in support is quite clearly in favour of granting the extension. The expert evidence is clearly relevant to determination of substantive grounds of a serious opposition on its merits, the expert evidence is being diligently pursued and consequential disadvantage to Wrigley and the public interest, including that of the Patent Office, are clearly of lesser weight.
I believe that Cadbury’s fourth application for extension of time reveals that Cadbury has not been diligent in pursuing expert evidence for a significant period of 2006. This circumstance was considered with all other relevant circumstances in the Commissioner granting the fourth extension of time and hence is not, of itself, open for reconsideration in the instant matter. Subsequent circumstances and revelations have, in no way, altered the balance of considerations before the Commissioner when granting the fourth extension of time.
In the 3 months between the circumstances considered by the Commissioner in granting the fourth extension of time and the circumstances relevant to my consideration of Cadbury’s fifth application for extension of time, the weight to be given to Wrigley’s interests and to the public interest of expeditious determination of the opposition has increased relatively, simply by its inherent nature. In my view, the increasing weight of these considerations does not hold sway over the opposing considerations expressed above.
Conclusion
In line with my reasoning above, I believe that consideration of all circumstances relevant to Cadbury’s fifth application for extension of time clearly warrants granting of the extension and I accordingly grant the opponent Cadbury Schweppes PLC an extension of time to 30 May 2007 in which to serve evidence in support.
Costs
The normal practice is that costs should follow the event. In the present matter, I have decided that the extension of time was clearly allowable in accordance with the determined law on the circumstances and considerations presented in the application for extension of time. Consequently, I award costs against Wm. Wrigley Jr. Company.
Bill Major
Delegate of the Commissioner of Patents
22 June 2007
Patent attorneys for the applicant : Spruson and Ferguson, Sydney
Patent attorneys for the opponent : Griffith Hack, Melbourne
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