COMALCO ALUMINIUM LIMITED

[1996] APO 20

official notice

decision of a delegate of the commissioner of patents

Patent             :          No. 604187 in the name of COMALCO ALUMINIMUM
  LIMITED.

Title             :          Atomizing Burner for Liquid Fuels.

Action : An application under section 223 for an extension of time to
  pay a renewal fee.

Decision:          Issued            .

Abstract: Failure to pay the renewal fee within the time required found to be due to error or omission. There were considerable delays in filing the extension of time and subsequently the statutory declarations in support. Because of the circumstances of the case, the public interest prevails over the private interests of the patentee in the exercise of the discretionary powers conferred by section 223(2). Grant of extension of time under section 223(2) refused.

patents act 1990

decision of a delegate of the commissioner of patents

Re:      Patent Application No. Patent No. 604187 by COMALCO ALUMINIUM LIMITED,
and an application under section 223 of the Patents Act 1990 for an extension of time to
         pay a renewal fee.

background

Patent application number 32461/89 was lodged on 5 April 1989 by R & D Carbon Ltd (R & D Carbon).

On 17 September 1990 a request for direction under section 34(4) of the Patents Act 1952 was made by Comalco Aluminium Limited (Comalco). Comalco requested patent application number 32461/89 proceed in their name by virtue of an assignment dated 22 August 1990. A copy of the Deed of Assignment accompanied the request. No action by the Office was taken on this request.

Patent application number 32461/89 was advertised accepted on 6 December 1990 and assigned number 604187.  It was granted on 2 April 1991 in the name of R & D Carbon.

Patent number 604187 ceased on 5 April 1991 when the renewal fee was not paid either by the anniversary date of 5 April 1991 or, upon payment of an additional fee, within the grace period of 6 months after that date.  The patent was advertised as being ceased in the Official Journal of 12 December 1991.

In a conversation on 20 September 1994 with an attorney from Griffith Hack & Co., the address for service, the Office suggested the old deed be returned so a new deed in the name of Comalco could be issued.

On 29 September 1994 Carter Smith & Beadle, the new address for service, made an application for extension of time under section 223 of forty-two months from 5 April 1991 to 5 October 1994 for the purpose of paying a renewal fee. Statutory declarations were filed in support of the application on 9 May 1995, 12 May 1995 and 31 July 1995.

On 12 October 1994 Carter Smith & Beadle requested that the previous application under section 34(4), that had been timely filed and not been processed by the Office, be now treated as a request to amend the Register of Patents to transfer the ownership from R & D Carbon to Comalco. This request was advertised in the Official Journal on 8 December 1994, as well the ceasing was readvertised.

On 25 May 1995, after a consideration of the statutory declaration filed on 9 May 1995, Comalco was advised as follows:

“the Commissioner is not satisfied that the extension of time sought is justified by the material supplied in support. ... It is not clear, however, what was the nature of the error or omission, who made it, or what were the surrounding circumstances in which it was made.

...

In relation to the exercise of the Commissioner's discretionary powers under the provisions of section 223(2), it is considered that on the face of it there have been undue delays in:

i)         filing the request for extension of time, and

ii)        filing relevant evidence in support of the request for extension of time.

...

In view of the delays in prosecuting this matter before the Office, you are advised that the matter will be set down for a hearing in Canberra on 16 August 1995 ... If any further material in support and/or submissions received sufficiently in advance of the hearing satisfy the Commissioner that the extension is justified, the hearing will be cancelled.”

Following consideration of the statutory declaration received on 12 May 1995 Comalco was advised that the points raised in the previous response of 25 May 1995 remained outstanding.

On 31 July 1995 further submissions and statutory declarations were received.  On 14 August 1995 Comalco was advised as follows:

“The extension of time presently sought is for a period considerably greater than 2 years ... your attention is drawn to the recently issued decision by a delegate of the Commissioner in the matter of an application under section 223 by Sanyo Electric Co. Ltd for an extension of time to pay a renewal fee (an unreported decision dated 5 July 1995). Having regard to that decision the Commissioner is not satisfied in relation to the present matter that the onus upon the patentee, to establish that the private interests should prevail over the interests of the public, has been met.

In order to afford you an adequate opportunity to address the issues in the present matter in the light of the aforesaid Sanyo decision, the hearing set down for 16 August 1995 is to be postponed to 16 October 1995.”

The hearing took place in Canberra on 16 October 1995.  Mr Gary Nock, patent attorney of Carter Smith & Beadle, Melbourne, appeared for Comalco.

THE Request for an extension

The request

In the request for the extension of time it is stated that:

“The circumstances in which, and the grounds upon which, this application is made are as follows:

Due to an error or omission payment of the renewal fee was not paid by the due date of 5 April 1991.

Statutory Declaration(s) setting out the circumstances surrounding the failure to timely pay the renewal fee will be lodged in the near future.”

The declarations

The declarations filed in support of the extension sought consist of a statutory declaration made by Gregory Richard Munt filed on 9 May 1995, a statutory declaration made by Geoffrey J. Houston filed on 12 May 1995 and statutory declarations made by Geoffrey Richard Munt, Geoffrey J. Houston, Robert Charles Walker and Gary William Nock filed on 31 July 1995.

I will refer to these statutory declarations at appropriate places in the decision.

Submissions

Mr Nock summarised his main submissions as follows:

1. That the present case can be distinguished from the Sanyo case cited in the official letter dated 14 August 1995;

2. That the reasons given for refusing the extension of time in the Sanyo case are restricted to the facts of that case and do not constitute a generally applicable statement of law: and

3. That the facts of the present case meet the requirements for having the extension of time granted.  In particular, our submissions will show (1) that the patent ceased due to an error or omission, (2) that failure to pay the renewal fee was unintentional, that there had been no undue delay in filing and prosecuting the request for extension of time and (3) that the public interest will not be prejudiced by the extension of time being granted and the patent being restored.

At the hearing I advised Mr Nock that I was satisfied that it had been established that the reason for the failure to pay the renewal fee due 5 April 1991 was because of an error by an agent of the patentee. I therefore invited Mr Nock to base his submissions on considerations relevant to the exercise of the Commissioner’s discretionary powers conferred by section 223(2)(a), in particular those matters raised in the letter from the Patent Office of 14 August 1995, especially in regard to the unreported decision of the Delegate of the Commissioner in Sanyo Electric Co. Ltd’s Patent. (Patent Office decision, 5 July 1995, patent no. 592800).

At the hearing Mr Nock requested that I consider the requirement of subsection 223(4) regarding the advertisement of the request for the extension of time, before I make a decision on the case.  As the patentee had provided reasons why the discretion of the Commissioner could be exercised, it seemed reasonable to me that advertisement should occur.  Accordingly I directed advertisement of the request for the extension of time.  This advertisement appeared in the Official Journal of 16 November 1995.  No person filed an opposition under subsection 223(6) to the grant of the extension request.

decision

The provisions of section 223 relevant to the present request for an extension of time are as follows:

“(2) Where, because of:

(a) an error or omission by the person concerned or by his or her agent or attorney; or

(b) circumstances beyond the control of the person concerned;

a relevant act that is required to be done within a certain time is not, or cannot be, done within that time, the Commissioner may, on application made by the person concerned in accordance with the regulations, extend the time for doing the act.

...

(11) In this section:

“relevant act” means an action (other than a prescribed action) in relation to a patent, a patent application, or any proceedings under this Act (other than court proceedings) ... .”

Section 223 has application to extend the time to pay a renewal fee since the doing of an act in accordance with regulation 13.6(1) or 13.6(3) is not identified under regulation 22.11(3) as a prescribed action to which section 223 does not apply.

Error or omission

The Commissioner may exercise the discretionary powers under subsection 223(2)(a), if there is an error or omission by the person concerned, or by his or her agent or attorney, which resulted in the failure to pay the renewal fees in time.

On 10 November 1990 CPA removed patent number 604187 from its renewal records because R & D Carbon’s Swiss patent attorney told it the renewal fees would be paid through other channels.  At about the same time Griffith Hack & Co., Comalco’s then patent attorney, advised CPA to change its records so that Comalco Smelting became the agent giving instructions about the payment of the renewal fees, instead of R & D Carbon’s Swiss patent attorney.  CPA failed to use the correct procedure on receiving Griffith Hack & Co.’s advice and did not reinstate the patent to its renewal system.  Therefore CPA failed to request instructions about the payment of the renewal fees from Comalco Smelting, Comalco or Griffith Hack & Co.

Dr Houston, the relevant officer in Comalco, declared that he relied on Comalco’s patent attorney to maintain adequate records and provide reminders that renewal fees were due.  Therefore I am reasonably satisfied the failure of CPA to reinstate the patent to its renewal system led to the failure to pay the renewal fees due by 5 April 1991.

Discretionary considerations

From the material supplied in support of the request for the extension of time, I constructed the following chronology of events:

5 April 1989               Patent application no. 32461/90 in the name of R & D Carbon filed.
  Griffith Hack & Co. given as address for service.

22 August 1990          Application assigned from R &D Carbon to Comalco.

11 September 1990     Application accepted in the name of R & D Carbon.

17 September 1990 Application made under section 34(4) of Patents Act 1952 to direct that the
  application proceed in the name of Comalco filed.  No Patent Office action.

20 November 1990     Griffith Hack & Co. forwards letter to Dr David Williams of Comalco
  advising that CPA held details of the application and that they would
  receive correspondence from CPA regarding the renewal fee.

6 December 1990       Application advertised accepted in Official Journal.

2 April 1991               Patent sealed.

5 April 1991               Renewal fee due for payment (not on file with the Patent Office).

5 October 1991          Renewal fee not paid within period of grace.  Patent ceased on 5 April
  1991 (not on file with the Patent Office).

12 December 1991     Ceasing of patent advertised in Official Journal.

25 March 1994           Carter Smith & Beadle attempted to pay renewal fee.

5 April 1994               Patent Office advises Carter Smith & Beadle that Comalco had been
  incorrectly named as patentee on the renewal fee payment.

6 June 1994                Patent Office advises Carter Smith & Beadle that the patent has ceased.

17 June 1994              Comalco advised of ceasing of patent.

19 June 1994              Comalco instructs Carter Smith & Beadle to “recover” patent.

5 July 1994                Carter Smith & Beadle asks Griffith Hack & Co. why patent had ceased.

20 September 1994     Griffith Hack & Co. replies to Carter Smith & Beadle.

28 September 1994     Comalco requests extension of time to pay renewal fee due by 5 April 1991.

9 May 1995                First Munt declaration filed in support of request.

12 May 1995              First Houston declaration filed in support of request.

31 July 1995              Nock, Walker, second Houston and second Munt declarations, together
  with submissions, filed in support of request.

It is clear from this chronology that there has been a significant delay in filing the request for the extension of time and in the provision of material in support of the request.  Mr Nock submitted that:

1. neither Comalco nor their agents received any official letters from the Patent Office informing them that the patent had lapsed until June 1994 and the section 223 request was then filed 3 ½ months later;

2. at the time of the advertisement in the Official Journal the official records of the Patent Office gave the patentee as R & D Carbon and not Comalco, even though Comalco had taken ownership of the patent.  Therefore the advertisement of the ceasing in the Official Journal would unlikely have alerted Comalco because the records did not show Comalco as the patentee; and

3. the evidence in support of the request for the extension could only be completed once declarations from CPA and Griffith Hack & Co. had been provided and as at this time they had ceased to be agents for Comalco, the delay in preparing evidence is due to the former agents and not the present agents.

In response to the first point Bowen CJ. and Deane J. in Board of Control of Michigan Technological University v Deputy Commissioner of Patents 34 ALR 529 stated at 534 that:

“Prima facie, any delay in making the application for restoration is to be measured by reference to the date of advertisement. ... Whether or not it is undue will depend on a variety of considerations.  Those considerations may arguably include whether the applicant or those acting on their behalf were aware of the advertisement at the time when it appeared.  Lack of knowledge may be relevant to the question whether the delay is undue.  It does not, however, prevent the period of delay from commencing at the time when the application for restoration could first be made, namely, on the publication of the advertisement in the Official Journal.”

Therefore even though lack of knowledge may be a relevant consideration as to whether the delay was undue the Patent Office did in fact inform Comalco and its agents of the ceasing of the patent through advertisement in the Official Journal.

In considering the lack of knowledge of Comalco or its agents as to the ceasing of the patent, in the present case, the period of time from when the patent was advertised ceased to the date of filing the request for the extension was 33 months.  Mr Nock submitted that CPA should have reminded Comalco when it was necessary to pay the renewal fee, but CPA didn’t as the patent was removed from the CPA database.  I think this explains why payment of the renewal fee on 5 April 1991 was missed, however it does not fully explain why Comalco failed to pay the renewal fee due in 1992 and 1993 if they maintained a continuing interest in the patent.

In regard to the second point, the advertisement in the Official Journal is listed in terms of the patent number and as such there is no mention of the patentee.  Therefore whether the patent was in the name of R & D Carbon or Comalco does not alter the advertisement.  Also I think it is clear from the evidence that in November 1990 both Comalco and its former attorneys knew the patent number of the present case even if they were unaware it was in the wrong name.  Therefore the advertisement in the Official Journal would not have confused them if they were aware of it.

In regard to the third point, there are two issues involved, the time for lodging the evidence and the time to file the request for the extension.  I will first consider the period from the lodgement of the request to the completion of the evidence, a period of 9 months.  The evidence suggests that Comalco’s former patent attorney is responsible for most of the delay in filing the evidence.  I note from the evidence that Comalco has identified the agent responsible for the error or omission and have gone to the trouble of securing declarations from their former agents to provide as direct knowledge of the relevant facts in the present case.  In doing so they made repeated requests to their former agents for the provision of these declarations.  Therefore even though the delay for the preparation of the evidence has added to the overall delay, because from the evidence it was caused by persons who were former agents of Comalco and who could not be forced to respond to an approach by Comalco, it was apparently out of the applicant’s control.

The second issue is the delay between the advertisement of the ceasing of the patent and the filing of the request for the extension of time, a period of 33 months.

The delegate in the Sanyo decision in considering the exercise of the Commissioner’s powers under subsection 223(2), stated at pages 12 to 13 that it

“will always depend on the facts of each case.  However, ... even where it has been established that the reason for a failure for a renewal fee to be timely paid was because of “an error or omission” or “circumstances beyond control”, it follows that:

...

(iii) if more that 24 months have elapsed from the date of ceasing until a request for an extension of time is properly made, the interests of the public will normally outweigh the interests of the patentee.”

In arriving at point (iii) the delegate considered that 24 months was relevant because:

“the public should be entitled to assume that it is highly likely that the reason why no restoration is in progress is either that the patentee decided not to renew or that the patentee has completely failed to meet its onus to adequately monitor the renewal process for its patent.”

I likewise consider that these public expectations, given the extension is for a period of greater than 24 months, are relevant to the exercise of my discretion in this case.  Thus the relevant factors I should consider, for the exercise of my discretion, are the continuing interest the patentee had in maintaining the patent, the adequacy of the renewal fee monitoring system the patentee had in place, the patentee’s approach to the filing of the request for the extension and the reasoning behind the failure to pay the renewal fee, and the public expectation of certainty in the Register.

Comalco asserted it had a continuing interest in the patent.  Dr Houston, as the responsible officer in Comalco, on receiving a reminder from Carter Smith & Beadle regarding the payment of a renewal fee, believed to be due on 5 April 1994, responded in a timely manner, with an instruction that Carter Smith & Beadle pay the fee.  Also Dr Houston declared that it was always his intention that the patent be maintained in force.  However there is no evidence before me that Comalco maintained a continuing interest in the patent from when it was assigned the patent to when it decided to restore the patent.

The evidence indicates that Dr Houston was aware that in order to maintain an Australian patent in force it was necessary that Comalco pay an annual renewal fee.  It might be expected that for a relatively short period (certainly not more than 1 year) the payment of the renewal fee could be overlooked, but in the present case Comalco did not make any inquiries as to the status of the patent until it was decided to consolidate all of Comalco’s patents and patent applications with the firm Carter Smith & Beadle.  That is, despite an expectation that renewal fees were due annually, there was apparently no effort by Comalco to ensure that the fees had been paid on an annual basis.

Comalco and its former attorneys believed that responsibility for the renewal reminders lay with CPA.  For example, Mr Munt for Comalco’s former attorneys declared:

“The entry for the patent application ... advises Computer Patent Annuities of a change of agent for the patent application ... and, in effect, is an instruction to Computer Patent Annuities to correspond directly with Comalco Smelting on the payment of renewals.”

Dr Houston, the relevant officer in Comalco, maintained a database of patents, but this was not used to generate renewal reminders.  He also stated:

“I rely on the patent attorneys retained by Comalco to maintain adequate records and provide reminders to me that renewal fees are due on each particular case. ...

... I never received any renewal reminders from Griffith Hack & Co. or Computer Patent Annuities.  Accordingly, I was unable to provide instructions regarding payment of the renewal fees on this patent.”

Comalco did not have an internal system for telling it which of its patents were in force.  So, for example, when it internally reviewed its patenting strategy prior to October 1992 it was not aware patent number 604187 had ceased.  Consequently it instructed its new patent attorneys to pay the renewal fee due by 5 April 1994.  It is the patentee’s responsibility to maintain an adequate monitoring system commensurate with a continuing interest in maintaining a patent in force.  In the present circumstances despite reliance upon CPA to pay the renewal fees it is my opinion that Comalco’s overall system for monitoring the payment of the renewal fees was inadequate.  Comalco in effect abrogated themselves from responsibility for ensuring the fees were timely paid.

In summary, the applicant relied upon CPA for renewal reminders.  Despite an awareness that renewals were due annually, Comalco did not even query the absence of renewal notices or payments.  While Comalco asserts that they had a continuing interest in the patent, the evidence before me is not inconsistent with a loss of interest in the patent, with a subsequent revival of that interest.

Weighed against the private interests of Comalco, there is the public interest.  The extension is for a period of time of 33 months.  As discussed earlier, I consider there is a strong and increasing public expectation of certainty in the Register where the period of lapsing is in excess of 2 years.  In the present case I consider this public interest outweighs the private interests of the patentee.  Consequently I consider it is not appropriate in the present circumstance to exercise the discretion in favour of Comalco.

summary

I have found that the reasons behind the failure to pay the renewal fee was due to an error or omission and because of the surrounding circumstances of this case I should not exercise my discretionary powers conferred by subsection 223(2) in favour of the applicant for the extension of time.  Thus I refuse to grant the extension of time sought.

Mark Ross
Delegate of the Commissioner of Patents

Patent attorneys for the patentee  :Carter Smith & Beadle, Melbourne.