Calsil Limited v Bevan James Riekie and Arthur Simpfendorfer

[1989] APO 3

In the Matter of the Patents Act 1952 - and - In the Matter of Application No. 561901 for a Patent by CALSIL LIMITED - and - In the Matter of Opposition thereto by BEVAN JAMES RIEKIE and ARTHUR SIMPFENDORFER 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 No. 561901 for an invention entitled "Pre-Cast Pre-Tensioned Concrete Slab and Method of Manufacturing Same" was advertised accepted in the official Journal on 21 May, 1987. Bevan James Riekie and Arthur Simpfendorfer (R AND S) lodged notice of opposition on 20 November, 1987 after an extension of time under sub-section 59(1) was allowed. Applications for extension of time to serve evidence-in-support were allowed unopposed until 20 November, 1988. On 15 November, 1988 R AND S lodged an application for a further extension of time until 20 February, 1989. The applicant (CALSIL) objected to this extension, consequently the matter was set down for hearing in Canberra on 20 December, 1988. Mr. P.F. Kildea, patent attorney, appeared for Wray & Associates, the patent attorneys representing CALSIL and Mr. G.M. Chambers, patent attorney of Phillips, Ormonde & Fitzpatrick, represented R AND S.

The Application for Extension of Time

The circumstances and grounds in the application for extension of time read as follows:

"A substantial quantity of prior art material has been located and has been assessed. It is currently being put into the form of declarations suitable for presentation as evidence. Additional time has proven necessary in view of the need to prove the state of the common general knowledge and the additional time is required for this purpose."

Submissions

Mr. Chambers submitted that R AND S were mounting a serious opposition because the evidence-in-support had been served on 14 December, 1988 and lodged at the Office on 16 December, 1988. He pointed out the evidence had been served and lodged less than one month into the presently requested period and had been served and lodged before the date of the hearing.

Mr. Chambers stated that the prior art documents, which had been located before the present application for extension of time was lodged, were not in a form suitable for service on CALSIL. Consequently more time was required to place the material in a suitable form, including time to obtain statutory declarations from third parties. However, following CALSIL's objection to the extension of time, the material was reassessed and R AND S decided to pursue the section 59 opposition without these declarations. Thus the evidence-in-support of the opposition had been served and lodged out of time but before the date of the hearing. Consequently Mr. Chambers submitted that allowance of the present application for extension of time would not delay the opposition proceedings because the evidence-in-support had already been served and lodged.

Mr. Chambers said that R AND S were competitors of CALSIL in the marketplace. Moreover he pointed out that CALSIL had opposed under section 59, R AND S's patent application No. 527996, which described a concrete slab similar to that described in application No. 561901 (Riekie and Simfendorfer v. M.J. McGrath Pty. Ltd. and Calsil Ltd. 7 IPR 120). Thus Mr. Chambers argued that the previous proceedings between the parties (op. cit.) made it seem more likely that the present section 59 opposition would be serious (Daido Metal Co. Inc. v. Gould Inc. 1981 AOJP 1238 at page 1238). Also in relation to the seriousness of the present section 59 opposition, Mr. Chambers directed my attention to another decision of the Office in which the hearing officer considered that the service of the evidence before the hearing of the application for extension of time suggested that a serious opposition was being mounted (Roussel-Uclaf v. Shell International Research Maatschappij BV and Ciba-Geigy AG 9 IPR 475 at page 479).

Finally Mr. Chambers submitted that it was in the public interest that an opposition to the granting of patent application be considered on its merits rather than shut out through some lamentable failure (Kaiser Aluminium and Chemical Corp. v. The Reynolds Metal Co. 120 CLB 136 at page 143).

Mr. Kildea said that CALSIL did not dispute the need for sufficient time to prepare evidence-in-support provided it was apparent that the opponents acted diligently and that there was prima facie support for the grounds of opposition. Turning to the evidence-in-support, which was served on 14 December, 1988, he pointed out that this consisted of two declarations; one by Malcolm J. Royal, which exhibited statutory declarations which were served during the opposition proceedings in respect of R AND S's application No. 527996 (supra) and a declaration by Bevan James Riekie.

Mr. Kildea stated that CALSIL had not been made aware of any difficulties that the opponents may have had in gathering evidence and he also said that the subject matter of the opposed patent application was not technically complex. According to Mr. Kildea the Riekie declaration added little to the declaration which Mr. Riekie made in the section 59 opposition to application No. 527996. Thus he concluded that the evidence-in-support, which was served on 14 December, 1988, consisted of little more than the evidence which was served and lodged by both parties in the previous section 59 opposition. Consequently he submitted that it was clear that R AND S had not been diligent in collecting evidence-in-support of the opposition to application No. 561901. Mr. Kildea then directed my attention to the fact that the claims of application No. 561901 had been amended after the subject matter was found to be prior published by and lack novelty in the light of the disclosures of application No. 527996 (Calsil Ltd.'s Application 1987 APOR 34 at page 37). Therefore he argued that the evidence-in-support served on 14 December, 1988, consisted of matters relevant to patent application No. 527996 which were no longer prima facie relevant to the section 59 opposition to application No. 561901.

In conclusion, Mr. Kildea submitted that the opponents had not discharged the onus of establishing that the section 59 opposition is indeed serious, nor had they discharged the onus of proving that they have a case for favourable exercise of the Commissioner's discretion in respect of the application for extension of time.

Mr. Chambers responded by pointing out that the application for extension of time referred to "the need to prove the state of common general knowledge" and also referred to material "currently being put into the form of declarations suitable for presentation as evidence". He said that it was up to the opponents to decide which material they wished to serve in support of the opposition and in the end R AND S had decided not to rely on declarations from third parties. Mr. Chambers stated that the previous Office decision concerning application No. 561901 (op. cit.) did not mean that the evidence served in the opposition to application 527996 was not prima facie relevant to the current section 59 opposition. He argued that there were different considerations in a decision made before acceptance of a patent application and a decision made under section 59, for example before acceptance there was no consideration given to the obviousness of the subject matter defined in the claims. Consequently he submitted that evidence, which was prima facie relevant to the section 59 opposition to application No. 561901, had been served before the present hearing thus demonstrating that R AND S were mounting a serious opposition.

Decision

The law on extension of time in this class of action has been comprehensively reviewed in Vangedal-Nielsen v. Smith (1980) 33 ALR 144 and in Lyons v. Registrar of Trade Marks (1983) 1 IPR 416. It is apparent therefrom that 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 for patents, 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.

Additionally, it is important concerning evidence-in- support and an opponent's interest therein, that an opponent should not be deprived of properly prosecuting its opposition because it has failed to bring its material evidence before the Commissioner within the period allowed. Nevertheless, it is clear from the above decisions that the applicant for the extension of time carries the onus of proof.

Turning to the present situation, I can see no reason why the evidence-in-support, which was served on 14 December, 1988, was not lodged within the period already allowed. According to Mr.. Chambers the opponents decided not to serve declarations from third parties which they originally intended to rely on. Even so I cannot understand why the material which was served on 14 December, 1988 was not served at an earlier time. Moreover Mr. Chambers did not explain why it was thought necessary to go to third parties to prove the state of common general knowledge when both opponents appear to have been involved in the relevant art before the present priority date (Riekie and Simpfendorfer v. M.J. McGrath Pty. Ltd. and Calsil, supra, page 123). Also there was no explanation of why it took more than the presently allowed period to collect evidence from third parties in the area of technology which does not appear to be complex. Consequently there is insufficient evidence for me to find that some good reason existed why R AND S have been unable to serve the evidence-in-support within the time allowed. However it also follows that there is insufficient evidence for me to agree with Mr. Kildea's submission that the opponents have not acted diligently.

I do not think that R AND S are in a similar situation to the opponent in the Daido Metal case (op. cit.) because in that case the previous legal proceedings between the parties involved overseas patent applications which corresponded to the patent application in suit. The previous legal proceedings between the present parties concerned CALSIL's opposition under sub-section 59(1) to R AND S's application No. 527996. I note the hearing officer in these proceedings concluded that there was evidence of a confidential disclosure of information in relation to R AND S's concrete slab to an employee of CALSIL (Riekie and Simpfendorfer v. M.J. McGrath Pty. Ltd. and Calsil, supra, at pages 123 to 125). It seems to me that this evidence may be relevant to the ground of obtaining which is listed in the present notice of opposition. The hearing officer also found that certain claims of application No. 527996 lacked novelty in the light of a "Russian paper" (supra pages 126 to 129). Another hearing officer found that the claims of application No. 561901 were prior published by and lacked novelty in the light of the disclosures in application No. 527996 (Calsil Ltd.'s Application, supra, at page 37). The claims of the present patent application were subsequently amended so that application No. 527996 is no longer a relevant citation. However I do not think it follows that the disclosures in the "Russian paper" are therefore irrelevant to the subject matter claimed in application No. 561901. Thus I do not agree with Mr. Kildea's argument that, prima facie, amendment of the claims of application No. 561901 has made irrelevant the evidence which was served in the section 59 opposition to application No. 527996.

Mr. Riekie in his declaration refers to patent No. 527996 and an application (No. 576648) made by virtue of sub-section 51(1) in respect of that application. I note that application No. 576648, which was not considered by the hearing officer in the earlier decision concerning application No. 561901 (op. cit.), describes a method of building a house which includes the step of making a concrete slab similar to the present slab. Moreover in this decision the hearing officer did not consider whether the presently claimed subject matter was obvious in the light of the disclosures in application No. 527996. In my view the evidence which was served on 14 December, 1988 is prima facie relevant to the section 59 opposition to application No. 561901. Therefore in parallel with my conclusion in the Roussel-Uclaf decision (op. cit.) I conclude that R AND S are in the process of mounting a serious opposition to the patent application in suit.

The final consideration concerns the respective interests of the parties and the public interest. It is in R AND S's interest to allow the application for extension of time as the opposition under sub-section 59(1) would proceed. Moreover if the extension is allowed there will be no unreasonable delay in proceedings because the evidence-in-support has already been served and lodged. Clearly allowance of the extension will adversely affect CALSIL's interests because there will be a delay in sealing a patent on application No. 561901. However if I do not allow the application for extension of time CALSIL's interests will also be adversely affected because sealing will be delayed by a "bar to sealing" action. In this action a delegate of the Commissioner would decide whether any patent, which might be granted on application No. 561901 would be clearly invalid having regard to the evidence lodged by R AND S (unreported decision issued in respect of application Nos. 539758 and 541978 on 28 November, 1988).

Kitto J. in Kaiser Aluminium and Chemical Corporation v. The Reynolds Metal Company (43 ALR 156 at page 158) said that in his opinion it is in the public interest that a serious opposition should be dealt with on the merits rather than it should be shut out in consequence of a lamentable failure. Although this opinion was expressed in relation to a failure to lodge a notice of opposition within the time allowed it is clear that Kitto J. thought that the merits of a serious opposition should be determined on the basis of evidence. I think that the Commissioner, in deciding whether a worthless patent would be granted on application No. 561701, would be assisted more if there was evidence from both CALSIL and R AND S rather than if there is evidence from only R AND S. Therefore I think that the public interest would be best served if CALSIL is allowed the opportunity to serve evidence-in-answer. Thus on balance, I consider that it is in the public interest as well as in the interests of both parties to allow the extension of time. Consequently I allow R AND S an extension of time to 20 February, 1989 in which to serve and lodge their evidence-in-support.

In respect of CALSIL's evidence-in-answer I consider that the period specified in sub-regulation 56(1) should commence on the date of this decision.

Costs

Mr. Chambers argued that it was unusual for an objection to an application for extension of time not to be withdrawn when the evidence was served prior to the hearing of the application for extension of time. He also said that a letter which was sent to Wray & Associates on 16 December, 1988, invited CALSIL to withdraw the objection in the light of the service of the evidence and offered to meet taxable costs to that date. Mr. Chambers said there had been no response to this letter at the time of the hearing. Consequently Mr. Chambers submitted that costs should be awarded to his clients.

Mr. Kildea was unable to comment on the letter dated 16 December, 1988 because Wray & Associates had sent him his copy of the file on that date. However he argued that the objection was maintained because CALSIL considered that the evidence which was served on 14 December, 1988 was prima facie irrelevant to the grounds of opposition. Moreover he said that the reasons given in the application for extension of time were inadequate. Therefore Mr. Kildea submitted that costs should be awarded to CALSIL.

After consideration of Mr. Kildea's submissions on costs it seems to me that the offer to pay costs may not have changed CALSIL's decision to maintain the objection to the extension of time. In any case I cannot be certain that the letter dated Friday, 16 December, 1988 was received by the relevant person in Wray & Associates in sufficient time to seek instructions before the date of the hearing on Tuesday, 20 December, 1988. I note that a copy of the letter dated 16 December, 1988, which was lodged on that day was not on the file of application No. 561901 at the date of the hearing.

It seems to me that CALSIL was justified in assuming that the circumstances and grounds given in the application for extension of time did not relate to the evidence which was served on 14 December, 1988. However I disagree with CALSIL's argument that the evidence-in-support, which was served on 14 December, 1988, is not prima facie relevant to the section 59 opposition to application No. 561901. On the other hand my decision to extend the time was not based on the circumstances and grounds given in the application for extension of time but was based on the public interest in having the present section 59 opposition decided on its merits. Consequently, in this situation, I consider that I should make no award of costs.

(M KENDALL)

Supervising Examiner of Patents

2 MAR 1989

Patent Attorneys for the Applicant: Wray & Associates

Patent Attorney for the Opponents : Phillips, Ormonde & Fitzpatrick