Commonwealth Scientific and Industrial Research Organization v. Western Mining Corporation Limited and Roxby Management Services Pty. Limited

[1988] APO 47

In the Matter of the Patents Act 1952 and In the Matter of Patent Application No. 571105 by COMMONWEALTH SCIENTIFIC AND INDUSTRIAL RESEARCH ORGANIZATION - and In the Matter of Oppositions thereto by 1. WESTERN MINING CORPORATION LIMITED, - and - 2. ROXBY MANAGEMENT SERVICES PTY. LIMITED - and - In the Matter of Objection to Applications for Extension of Time to Serve Evidence-in-Support.

 

DECISION OF A SUPERVISING EXAMINER OF PATENTS:

Background

Application No. 571105, entitled "Selective Extraction of Uranium", was advertised accepted on 31 March, 1988. The application is one to which section 50 applies and it is based on application Nos. PG6760 and PG7444 which were lodged on 24 August, 1984 and 1 October, 1984 respectively.

The section 59 opponents (WESTERN and ROXBY) lodged similar notices of opposition on 29 June, 1988 which specified the grounds in paragraphs (a) and (c) to (i) of sub-section 59(1). On 26 September, 1988 both opponents lodged an application for extension of time to 29 December, 1988 in which to serve evidence-in-support of their oppositions. The applicant (CSIRO) objected to the extensions, consequently the matters were set down for hearing in Canberra on 27 October, 1988. Mr. J. Slattery, patent attorney of Davies & Collison, represented CSIRO and Mr. M.J. Royal, patent attorney of Phillips, Ormonde & Fitzpatrick, represented WESTERN and ROXBY. Mr. Royal presented a single set of submissions on behalf of both opponents.

The Applications for Extension of Time

The applications for extension of time lodged by WESTERN and ROXBY rely on the same circumstances and grounds which read as follows:

"The Opponent has not been able to complete the preparation of the Evidence in Support. Witnesses have been interviewed and prior art material located. Additional time is required to further research the prior art, to hold further discussions with witnesses and to prepare draft evidence for settling. Additional time is required for this purpose."

Evidence

At the hearing Mr. Royal lodged a statutory declaration made by himself on behalf of WESTERN and ROXBY. The relevant part of this declaration reads as follows:

"On 22 June 1988 I received instruction on behalf of the said opponents to lodge Notices of opposition. Notices of Opposition were lodged on 29 June 1988.

Since the Notices of Opposition have been lodged I have conducted interviews and received statements of several potential witnesses who are able to declare to the state of the prior art in Australia relevant to the said application.

I have also received instructions and have initiated searches of prior art in Australia and overseas. In particular I have arranged for searches of libraries and other Australian sources of prior art material. These searches are under way but the results are not yet to hand.

From the information I have collected and on my instructions the oppositions are serious oppositions which I believe to have good prospects of success.

There has been no unnecessary delay on behalf of either opponent in the collection and preparation of the evidence that will be served in support of the said oppositions. Additional time is necessary to complete the searches, to obtain opinions of expert witnesses in relation to the search results and to draft and have settled the necessary declarations. The oppositions will be prejudiced if sufficient time were not made available for these purposes."

Mr. Slattery lodged a statutory declaration at the hearing which was made by ALFRED PERNAT. Mr. Pernat is the manager of the Intellectual Property Group of Sirotech, which is a technology transfer company established by CSIRO. He states that he has access to the files of Sirotech and CSIRO in relation to application No. 571105 and says that his declaration is based on information supplied to him by Mr. Julian Land and Dr. G. Sparrow. Mr. Land is the Senior Project Manager of Sirotech who has responsibility for the marketing and commercialisation of the invention which is the subject of application NO. 571105 and Dr. Sparrow is a CSIRO scientist, who is named as one of the inventors in the present application.

The relevant part of Mr. Pernat's declaration reads as follows:

"3. It is my understanding that the opponent companies, Western Mining Corporation Limited and Roxby Management Services Pty. Ltd. are related companies in the sense that Western Mining Corporation Limited holds a substantial shareholding in Roxby Management Services Pty. Ltd., and that both these companies have an interest in the Olympic Dam copper-uranium-gold deposit on Roxby Downs Pastoral Station, South Australia.

4. As noted on pages 2 to 3 of the complete specification of Application No. 571,105, and confirmed by the Abstract of a paper by members of the staff of Roxby Management Services Pty. Ltd. on the geology of the Olympic Dam deposit, (a copy of which is attached hereto marked "A") that deposit is unique in that it contains economic amounts of both uranium and copper, as well as gold and recoverable amounts of silver and rare-earth minerals. To my knowledge, no similar deposits have been located anywhere else in Australia. The present invention is directed to a process for selectively removing uranium from ores containing copper and uranium minerals, and is particularly directed toward extraction of uranium from the flotation concentrate from the Olympic Dam deposit.

5. Following preliminary research by Drs. G. Sparrow and G. Walker of the CSIRO Division of Mineral Chemistry in the period from late 1981 to early 1983 relating to the selective extraction of uranium from copper flotation concentrates, formal proposals were made by CSIRO to Roxby Management Services (hereinafter referred to "RMS") to investigate the application of the extraction process using Roxby Downs concentrates. In particular, a proposal for a CSIRO-RMS collaborative research project was made in June 1983, and this research proposal was subsequently accepted in October 1983, with work to commence in November 1983. Under this research project, visits were exchanged between CSIRO and RMS personnel, progress reports were sent by CSIRO to RMS and extensions to the research program were agreed from time to time.

6. In July 1984, a copy of a draft provisional specification relating to the process for the selective extraction of uranium was forwarded by Dr. G. Sparrow to the Chief Metallurgist at RMS, and a patent application accompanied by a provisional specification was subsequently filed at the Australian Patent Office on August 24, 1984 as Australian Patent Application PG6760/84, entitled "Selective Extraction of Uranium".

7. Activities under the research program as described in para. 5 above continued in the period after filing of the initial patent applications, and subsequent to the filing of a complete specification in respect of the application on August 15, 1985 as Australian Patent Application NO. 46252/85, a copy of the complete specification was forwarded to RMS by Mr. Julian Land of Sirotech.

8. Following filing of the complete specification in respect of Application No. 46252/85, discussions have continued between CSIRO, Sirotech and RMS in relation to the invention which is the subject matter of this Patent Application, and RMS has accordingly been well aware at all relevant times of the existence of the patent application and has had full details of the subject matter disclosed and claimed in the complete specification."

Submissions

Mr. Royal submitted that an application for an extension of time should cover the grounds relied on and that the grounds on which he relied fell within the scope of the reasons given in the applications for extension of time. He said the system would grind to a halt if each application for extension of time had to be accompanied by voluminous evidence to establish all the circumstances of the case.

Mr. Royal then directed my attention to the Vangedal-Nielsen case (Vangedal-Nielsen v. Smith (Commissioner of Patents) 33 ALR 144) in relation to the need to establish that there was a serious opposition. Mr. Royal said that his declaration states that it is his professional opinion that these are serious oppositions which have good prospects of success. He also said that Mr. Pernat's declaration established the serious nature of the conflict between the parties and it was in the public interest to review the situation with proper evidence. In particular he pointed out that the events described in paragraph 5 of the declaration may prior publish subject matter which is claimed in application No. 571105. Mr. Royal submitted that it was notorious that the collection of evidence in opposition proceedings took a considerable time (Lyons v. Registrar of Trade Marks 50 ALR 496 at page 499). He also referred to several Office decisions (e.g. Daido Metal Co. Inc. v. Gould Inc. 1981 AOJP 1238) in which he said the hearing officer had accepted an argument that an application for extension of time should be allowed in the twelve months following lodgement of the notice of opposition provided there were reasonable grounds. He also pointed out, that in another decision, the hearing officer had thought that it was not reasonable to expect an opponent to start collecting evidence-in-support before the date on which acceptance was advertised (D. Richardson and Sons Ltd. and Flakt A.B. v. James Howden Aust. Pty. Ltd. 1986 APOR 50 at page 43). Mr. Royal then suggested that the period for collecting evidence in support of an opposition commenced on the date the notice of opposition was lodged because prior to that date an opponent was deciding whether to mount an opposition.

Mr. Slattery directed my attention to regulation 83A and then argued that the present applications for extension of time had to be considered in the light of the circumstances of the present case which existed at the date the applications were lodged. He said this did not require the applicant to lodge voluminous evidence with the application for extension of time but if an objection was raised to the application then the applicant should be able to produce material to show that the extension was justified. Mr. Slattery said that one of the circumstances of the present applications was that ROXBY had been involved with the invention and had been aware of the contents of the complete specification since August 1985. Another circumstance, according to Mr. Slattery, was that the public interest factor in the present matter was small because the invention was concerned with the processing of a unique ore body, the Olympic Dam copper-uranium-gold deposit. He said it was unlikely that a similar ore, if discovered in the near future, would be ready for processing before any patent, which was sealed on application No. 571105, had expired. Mr. Slattery submitted that the onus was on WESTERN and ROXBY to show that the extensions of time were justified. He argued that the opponents had not discharged this onus because there was no evidence to show why the evidence-in-support could not be served in time, there was no evidence to show that the opponents were mounting serious oppositions and there was no evidence to show that a patent sealed on application No. 571105 would be worthless. Turning to Mr. Pernat's declaration, Mr. Slattery submitted that paragraph 5 of the declaration merely established that WESTERN and ROXBY had an interest in the present application. He also said he understood the collaborative research project was subject to an implied confidentiality arrangement between the parties. Mr. Slattery said that a decision to mount an opposition is generally made because the opponent has evidence-in-support of one or more of the grounds listed in the paragraphs of sub-section 59(1). Consequently he argued that the time for preparation of the evidence-in-support should be considered from the date of advertisement of acceptance.

In response Mr. Royal argued that Mr. Pernat's declaration was hearsay because it was based on information from several people, consequently he submitted that I should give this declaration little weight. With respect to Mr. Slattery's understanding of an implied confidentiality agreement between the parties, Mr. Royal said that this illustrated the need for evidence in relation to whether there was confidentiality or not. Finally concerning the degree to which ROXBY and WESTERN were aware of application No. 571105, Mr. Royal pointed out that the claims of the specification had been amended during prosecution of the application.

The Decision

The law regarding this class of extension has been comprehensively reviewed by the Federal Court in Vangedal-Nielsen V. Smith and Gelphen Nominees (1980) 33 ALR 144 and in Lyons v. Registrar of Trade Marks 1 IPR 416; in addition there are many Office decisions dealing with such extensions, quite a few of which are published in the Butterworth Industrial Property Reports (IPR) and in the CCH publication, Australian Industrial & Intellectual Property (AIPC). This law can be stated simply as follows:

(i) The Commissioner, before allowing the extension, must be satisfied that the person seeking the extension has made out a proper case justifying the extension;

(ii) The Commissioner must consider not only the private interests of applicants for patents, and opponents, but also the public interest, by ensuring that invalid patents are not granted, and that proceedings are not unreasonably protracted.

According to regulation 83A the Commissioner shall not grant the extension of time unless he is satisfied that the extension is justified having regard to all the circumstances of the case. Thus I agree with Mr. Slattery that each application for extension of time has to be decided in relation to its own particular circumstances. Therefore previous decisions of this Office will only be helpful in deciding the outcome of the present applications for extension of time if the circumstances are similar. In my view the decisions cited by Mr. Royal refer to circumstances very different to those of the present applications.

It seems to me that the application for extension should contain a concise statement of the material facts on which the applicant wishes to rely. However the applicant for extension of time should be able to lodge evidence to prove these material facts if called on to do so by the Commissioner or an opponent to the extension of time. For example the present applications for extension of time state that the section 59 opponent has not been able to complete the preparation of evidence-in-support and in my view this is one of the material facts which must be proved by evidence. The evidence to prove these material facts is not necessarily voluminous and is of a different nature to the evidence which is served in support of the section 59 opposition.

Mr. Royal's declaration only describes some of the circumstances of the present applications for extension of time because Mr. Royal, at the hearing, conceded that the section 59 opponents were aware of the events described in Mr. Pernat's declaration. Consequently I will have to rely on Mr. Pernat's declaration to some extent despite Mr. Royal's submission that this evidence is hearsay. In any case hearsay evidence is clearly admissible before the Commissioner (T.A. Miller Ltd. v. the Minister for Housing and Local Government 1968 1 WLR 992) and does not necessarily lead to a denial of natural justice (Minister for Immigration and Ethnic Affairs v. Pochi 31 ALR 666). I think Mr. Pernat's declaration describes several important circumstances which are not mentioned in the applications for extension of time or Mr. Royal's declaration. The first circumstance is that CSIRO and ROXBY commenced a collaborative research project relating to the selective extraction of uranium from Roxby Downs concentrates in November 1983. A second circumstance is that copies of the provisional and complete specifications, which relate to the selective extraction of uranium from an ore containing copper and uranium, were forwarded to ROXBY. I also conclude from Mr. Pernat's declaration that these circumstances were known to both ROXBY and WESTERN. I also note that the process is defined in identical terms in the claims with the broadest scope in the complete specification as lodged and the complete specification as accepted.

I think that the collaborative research project may have alerted ROXBY and WESTERN to some of the prior art which is relevant to the selective extraction of uranium from copper containing ores. Moreover the project may have allowed some of the employees of ROXBY to become skilled in this art prior to the lodgement date of the initial provisional specification. Thus it seems to me that ROXBY and WESTERN may have relied on this knowledge in deciding whether to oppose application No. 571105. Thus I cannot accept Mr. Royal's suggestion, in relation to the present section 59 opponents, that the collection of evidence commenced on the date of lodgement of the notices of opposition. Whilst, I consider that the collaborative research project may have provided a "springboard" from which ROXBY and WESTERN could mount their section 59 oppositions, I cannot be certain whether the opponents had sufficient time to prepare the evidence without examining more of the relevant circumstances of the case.

Mr. Royal asserts that there has been no unnecessary delay on behalf of either opponent in the collection and preparation of the evidence-in-support. He states that since the notices of opposition were lodged he has conducted interviews and received statements of several witnesses who are able to declare to the state of the relevant prior art in Australia. This statement, in my view, does not explain why there was insufficient time for these activities when some of the witnesses may be employees of the opponent companies who may have been involved with the collaborative research project. Mr. Royal also declares that he has initiated searches of prior art in Australia and overseas but the results are not yet to hand. Again Mr. Royal does not explain why two companies, who admit they are concerned with the same technology as the present application, and who have sufficient resources to rely on computer assisted searching and electronic communication, have had insufficient time to complete searching the relevant prior art, when some of the prior art may have been known to ROXBY and WESTERN as a result of the collaborative research project. I also note that the applications for extension of time state that prior art has been located but Mr. Royal declares that the results of searches are not yet to hand.

I conclude that the explanation of why ROXBY and WESTERN have been unable to prepare their evidence within the period allowed relies on the general proposition that it is well known that the preparation of evidence takes a considerable time. Whilst this proposition may be true in the general case, I think that it is incumbent on ROXBY and WESTERN to demonstrate that the proposition applies in the circumstances of the present applications, irrespective of whether they are the first or later applications. In the case of the present extensions, it may be that the collaborative research project and related activities are irrelevant to the time taken to prepare the evidence-in-support. However there is no evidence before me which clarifies the matter. Consequently there is insufficient evidence for me to find that some good reason existed why ROXBY and WESTERN have been unable to serve the evidence-in-support within the time allowed.

Mr. Royal does not declare to specific actions of the section 59 opponents which might assist me to decide if the opponents are mounting serious oppositions because his declaration is expressed in general terms. However he does express the view that these are serious oppositions which he believes have good prospects of success. Unfortunately Mr. Royal's professional opinion does not take the matter any further because it is the Commissioner who is interposed as the arbiter whether an extension should be allowed (Vangedal-Nielsen case, supra, page 150).

The fact that ROXBY and WESTERN are involved with the same technology as application No. 571105 provides a motive for these companies to mount section 59 oppositions but in my view the seriousness of the oppositions has to be determined from the actions of these opponents. In his declaration Mr. Royal does not state how the phrase "prior art material located", which is used in the applications for extension of time, relates to his opinion that these are serious oppositions. However at the hearing he did state that the events described in paragraph 5 of Mr. Pernat's declaration might amount to prior publication. It seems to me that the time taken to locate material related to a potential non-confidential disclosure of appropriate subject matter before the priority date is relevant to the preparation of the evidence-in-support of the ROXBY and WESTERN section 59 oppositions. Thus it is surprising that this aspect of ROXBY's and WESTERN'S case is not mentioned in the applications for extension of time or Mr. Royal's declaration. Also I was given no indication of when the opponents are likely to serve the evidence-in-support. The onus is on ROXBY and WESTERN to demonstrate that they are mounting serious oppositions however I am unable to conclude from the above considerations whether or not these are serious oppositions.

I reject Mr. Slattery's submission that there was little public interest in the present section 59 oppositions. The Olympic Dam copper-uranium-gold deposit may be unique but the scope of the claims of application No. 571105 relates to any ore containing copper and uranium and according to the specification this includes tailings of copper sulphide minerals.

Mr. Royal said that the events described in Mr. Pernat's declaration may have resulted in prior publication of subject matter which is claimed in application No. 571105. This allegation is not specifically given as a circumstance and ground in the applications for extension of time. However it is apparent that a worthless patent would be granted on application No. 571105 if this allegation of prior publication can be proved.

The final factor I have to consider concerns the public interest in ensuring that there are no unreasonable delays in proceedings. Mr. Royal conceded that WESTERN and ROXBY were aware of the events described in Mr. Pernat's declaration. Consequently it seems to me that the section 59 opponents may possess more evidence to support the applications for extension of time than they have actually lodged. I think the decision not to lodge more evidence is a lamentable failure because my earlier findings may have been conclusive if ROXBY and WESTERN had lodged more evidence in support of the applications for extension of time. ROXBY and WESTERN will have to decide whether to appeal to the Federal Court and file the evidence they failed to lodge if I do not allow the extensions of time. Thus this lamentable failure by ROXBY and WESTERN has the potential to delay the section 59 opposition proceedings. Clearly the section 59 oppositions will proceed if I allow the applications for extension of time but the sealing of a patent on application No. 571105 will be delayed. However this delay is justified if a worthless patent would otherwise be sealed on the application. I note that application No. 571105 was advertised accepted on 31 March, 1988.

Mr. Royal alleged that subject matter, which is claimed in application No. 571105, may have been prior published. Thus on balance, I consider that it is more in the public interest to allow ROXBY and WESTERN further time to prepare evidence in respect of the alleged prior publication than it is to shut out the section 59 opponents because of a lamentable failure to lodge evidence in support of the extensions of time (c.f. Kaiser Aluminium and Chemical Corp. v. Reynolds Metal Co. 120 CLR 136 at page 143). Consequently I allow ROXBY and WESTERN an extension of time to 29 December, 1988. in which to serve their evidence-in- support.

I should point out that the Commissioner is unlikely to allow future extensions of time in the present section 59 oppositions on the basis of the circumstances and grounds given in the present applications.

Costs

Mr. Royal submitted that costs should be awarded to his clients if the application for extension of time were allowed because all his arguments fell within the scope of the circumstances and grounds listed in the application. He said it would be a public mischief to award costs against his clients in this situation because it would imply that voluminous evidence would have to be filed even in the case of a frivolous objection. on the other hand Mr. Slattery said that if the applications for extension of time were allowed I should make no award of costs because the Commissioner could not be satisfied that an extension was justified from the grounds given in the applications themselves.

In my view CSIRO was justified in objecting to the present applications for extension of time because the applications themselves did not specifically refer to any relationship between the section 59 opponents and the applicant for the patent. Thus I do not think this was a frivolous objection by CSIRO. Earlier in this decision I found that ROXBY and WESTERN had lodged insufficient evidence for me to find that some good reason existed why they had been unable to serve the evidence-in-support within the time allowed and for me to conclude whether or not these are serious oppositions. However I do not consider that voluminous evidence was required to support the present applications for extension of time. In allowing the applications for extension of time I relied on matter which was, disclosed in a declaration lodged on behalf of CSIRO. Consequently I am satisfied that it is reasonable in this situation for ROXBY and WESTERN to pay CSIRO's costs.

(M. KENDALL)

Supervising Examiner of Patents

12 DEC 1988

Patent attorney for the Applicant: Davies & Collison

Patent attorney for the Opponents: Phillips, Ormonde & Fitzpatrick