Costa v GR & IE Daking Pty Ltd

[1994] APO 23

official notice

decision of a delegate of the commissioner of patents

Petty Patent       :    No. 623843 in the name of DOMINIC VICTOR COSTA

Title:    Boom Conveyor Loading Apparatus

Action:    Notice under section 28 by GR & IE DAKING PTY LTD alleging obtaining, prior use, and lack of novelty.

Decision:    Issued            . 

-a Mr Gerardis found to be a joint inventor of the invention;

-by his conduct, Mr Gerardis is estopped from claiming that the invention was obtained from him;

-the allegation of prior use has not been made out, any prior use being for reasonable trial and subject to the protection afforded by s.24(1);

-lack of novelty based on a newspaper advertisement not established; and

-extension of the term of the petty patent granted.

patents act 1990

decision of a delegate of the commissioner of patents

Re:Petty Patent No. 623843 by DOMINIC VICTOR COSTA, and a notice under section 28 by GR & IE DAKING PTY LTD.

background

Petty Patent 623843 was filed on 14 November 1991 as application 87928/91. On 6 Dec. 1991, the request was amended to associate the application with the applicant's provisional application PK6889, filed on 25 June 1991. This date is not disputed as being the relevant priority date for the claims of the petty patent.

On 25 Feb. 1993, the informants filed a notice under section 28, alleging the patentee was not entitled to be granted the petty patent, and that the petty patent was publicly disclosed by the patentee or another person before the priority date.

The invention in dispute relates to a conveyor arrangement mounted laterally on a trailer. The device is used in the picking of vegetables; hand-picked vegetables are placed on the conveyor and transported to the trailer to be manually placed in bins. The conveyor is intended to pass a small distance above the height of the vegetable crop, to minimise physical stress on the vegetable pickers.

An outline of the circumstances leading to the section 28 notice is:

-in early 1991, a Mr Joseph Gerardis borrowed a machine from the Caretti family;

-Gerardis found that the machine had two problems. Firstly, it could not be easily adjusted for different crop heights. Secondly, on soft soil the trailer would sink - the conveyor boom could then tilt, hit the crop, and damage the plants;

-In March 1991, Gerardis arranged for Mr Victor Costa to inspect the Caretti machine. Gerardis asked Costa to make a machine which did not have the above problems. (I note here that there is some dispute as to exactly what was said at this time);

-On or about 16 May 1991, the completed machine was delivered to Gerardis;

-On 30 May, Mr Costa and Dr. Paul Wyk (patent attorney of A.P.T., Adelaide) went to the property of Gerardis, where Gerardis demonstrated the machine;

-Costa filed a provisional application on 25 June;

-In August 1992, the patentee wrote to the informant GR & IE DAKING PTY LTD regarding infringement of their petty patent. Daking had apparently been making machines as a result of some contact (directly or indirectly) with Gerardis;

-Daking filed a section 28 notice on 25 Feb. 1993, relying primarily on the evidence of Gerardis (with a supporting declaration by a John Caretti. The s.28 notice alleged, inter alia, that Gerardis was the inventor of the machine, and the invention claimed was not novel on the basis of its prior public working.

A hearing in the matter was set for Adelaide, out of sessions, on Monday 7 Feb. 1994. Summonses were served on Mssrs Costa, Gerardis, and Caretti.

On the Friday before the hearing, I was contacted by one of the parties and advised that the patentee and informant were close to reaching a settlement in the matter; I understood the settlement involved an acknowledgement on behalf of Daking regarding inventorship of the machine. I indicated that, having regard to the evidence on file, an acknowledgement by Daking regarding inventorship was not relevant unless Mr Gerardis rescinded his claim to inventorship. In the event, Mr Gerardis maintained his claim to inventorship, and the hearing proceeded as scheduled.

At the hearing, the patentee was represented by Mr Forrest of counsel, assisted by Ms King, and Dr Paul Wyk (patent attorney of A.P.T., Adelaide). The informant was represented by Mr. Holland of counsel, assisted by Mr McFarlane (of R K Maddern & Associates, Adelaide).

Credibility of Witnesses

The majority of the hearing was concerned with the examination of the three witnesses, Gerardis, Costa, and Caretti.

The case of the informant depends critically upon the evidence of Gerardis, who alleges that he was the actual inventor of the invention. However it is he alone with whom I have concerns regarding credibility.

Gerardis' position in the present matter is somewhat unusual. He alleges that he is the inventor of the invention - yet he has not filed a notice under section 28, is not himself a party to these proceedings, and had not (at least at the commencement of these proceedings) assigned his alleged interest to anyone.

Gerardis claims to have no interest in the present invention (other than a claim to being an inventor) - as if his only real interest is in market gardening per se. But I note that he (together with the brother of the present patentee) is recorded as an inventor/patentee of petty patent 612313 (filed on 26 March 1991), and as an applicant of application 13806/92 (associated with PK5287, which also was filed on 26 March 1991).

On several occasions during this examination, Gerardis stressed his lack of interest in the invention, and that he was "only here to tell the truth". During his examination he was asked, on three separate occasions, whether he had entered into any arrangements (or signed any documents) with Daking in respect of similar machines that Mr Daking was building. On the first occasion, he stated he did not understand the question; that there was no financial bonuses for him; and that he was present to tell the truth. On the second occasion he denied assigning any interest in the machine, stating that he has no interest in it apart from his own. On the third occasion, he stated that he had not signed any documents with respect to the conveyor, trailer, or any part of the machine, with Mr Daking nor with the informant.

Subsequently counsel for Daking tabled a Deed of Assignment between Gerardis (and his brother) and Daking dated 16 November 1993 (11 weeks before the hearing). The deed asserts that Gerardis and his brother are the inventors of Petty Patent 623843 (and 616153), and purports to assign the invention to Daking for the:

"consideration of one dollar ($1.00) and other valuable consideration now paid by the Assignee to the Assignors (receipt of which is hereby acknowledged)..."

When this deed was tabled, Gerardis asserted that he had forgotten its existence. He also stated that there was no consideration other than the $1.00, despite the explicit terms of the document.

I have difficulty in accepting that Gerardis can, on the one hand, recall details surrounding the development of the machine some two years ago, and on the other hand fail to recall the deed of assignment executed some 11 weeks previous to the hearing - especially as the present dispute is critically dependant upon his claim to inventorship. His excuse that he 'forgot' is, in the circumstances, both convenient and incredible. This raises doubts about the credibility of his other evidence, particularly in so far as it is in conflict with other evidence, and I weight his evidence accordingly.

The Claimed Invention

It is appropriate to set out here claim 1 of the petty patent:

1. The combination of a boom conveyor and a trailer, said boom conveyor supported by said trailer and including a boom extending outwardly from one side of the trailer, said boom including an outer portion adapted to be positioned generally parallel with the ground and an inner portion adjacent to the trailer for elevating produce from the outer portion and delivering said produce onto the trailer, said boom conveyor including means to adjust the tilt and relative height of the boom relative to the trailer.

The highlighted portion of the claim provides the distinction from the Caretti machine.

Inventorship of the Machine

The parties apparently agree that the machine was created as a result of Gerardis asking Costa to build it. There is no dispute that Gerardis borrowed a machine from Caretti, and found that it had certain problems in its operation; that Gerardis showed Costa the Caretti machine, and asked him to build an improved machine, and that Costa built the machine.

Of critical importance is the input of Gerardis to the machine. It appears that the problem to be solved (the tilting of the boom, and the need for different heights for different crops) was identified by Gerardis. Gerardis asserts that he told Costa that what was required was a machine with a fork-lift mast head. Costa stated in examination that he had no recollection of such, and declared:

"He said that he wanted the conveyor to go up and down and that the conveyor should be adjustable for tilt. He suggested that I put a support pole at the higher point and use a hand winch to tilt the conveyor. I said that I will operate the machine by hydraulic power and because the conveyor would have hydraulics for a little extra cost I could fit a hydraulic tilt system."

I note that the features of the claim that distinguish it from the Caretti machine are thus attributed by Costa to Gerardis.

Further, during the construction of the machine Gerardis frequented Costa's workshop, apparently as often as 3 days a week. To me this indicates that Gerardis had ongoing input into the construction of the machine. However, I note the following testimony, which appears typical of the relationship between Costa and Gerardis. (The testimony is in relation to the size of hydraulic ram that Gerardis alleges he specified.)

GERARDISI specified my minimum, I didn't specify my maximum.

FORRESTDid you actually use the terms 24 inch stroke hydraulic ram, and 18 inch stroke hydraulic ram?

GERARDISSo to speak.

FORRESTWhat do you mean, so to speak?

GERARDISSo to speak. I'm not the engineer. I'm a market gardener, he's the engineer. He has a refinement. That's what I'm paying him for. If I knew exactly what I wanted I would have built it. But I make more money, right, by me doing my market gardening, right, and him doing the engineering than trying to do it myself, because I didn't go to school for that, and he did.

Thus, whilst Gerardis had general ideas of what was required in the machine, in my view he did not necessarily know how to put those ideas into effect.

I gain further support for this view from his examination, where Gerardis was asked a number of questions concerning his 'designing' machines. It became clear that Gerardis has never produced any engineering drawings for any machines that he developed. Rather he developed devices from a trial and error approach - and then nothing as complicated as the present machine. I gained the impression that Gerardis had a practical do-it-yourself approach to typical small problems that may occur with simple market-garden equipment, but has little expertise in designing large equipment, or designing major changes to such equipment.

In Harris v CSIRO 26 IPR 469, I discussed the matter of joint inventorship. On page 488 I stated:

'In my view the significant question is "would the invention have occurred without Harris' involvement (albeit unknowingly at the time)?" '

In the present case I am of the view that:

-Costa would not have made the machine without Gerardis providing the base requirements needed to overcome the identified problems with the Caretti machine; and

-while Gerardis had a general idea of what was required to solve the problem, he did not necessarily know how to give effect to those ideas; the creation of the invention required the input of Costa.

That is, the invention only occurred because of the involvement of both Gerardis and Costa, who I thus find are joint inventors of the invention claimed.

On the basis of this finding, and the absence of any reference on the patent request (or notice of entitlement) to Gerardis being an inventor, prima facie the invention has been obtained. However the conduct of Gerardis is relevant to whether or not the invention was in fact obtained.

The following part of the testimony of Gerardis is illustrative of the relevant conduct of Gerardis in relation to Costa making the patent application:

FORRESTYou knew that for him to get the patent he would have to say that he was the inventor of any improvements on the machine at least?

GERARDISHe said it, not me.

FORRESTBut you knew that, didn't you?

GERARDISNo, I didn't know that. But he said it, not me.

FORRESTWell hang on, you didn't know that to get the patent Mr Costa would have to say that he was the inventor of the machine, or some part of it or some aspect of it?

GERARDISWell he would have had to, so ...

FORRESTRight, you knew that, ... . You knew that, didn't you?

GERARDISMm.

FORRESTAnd you knew that wasn't the truth of the matter, didn't you?  The truth of the matter was that you were the inventor, according to you.

GERARDISYeh.

FORRESTRight. But you didn't say anything to him then about that, did you?

GERARDISNo.

FORRESTWhy not?

GERARDISI had no reason to.

FORRESTWell you did. You were the inventor, not him. That was the reason you had something to say. Now why didn't you say something?

GERARDISBecause I had no reason to. I felt that he'd done the right thing by me in the past, and if he could put a patent on it and he could be rewarded for it, well and good.

FORRESTBut you've changed your mind about that now?

GERARDISSince, yes.

FORRESTWhy 's that?

GERARDISBecause he's done the dirty on me.

FORRESTHow's he done the dirty on you?

GERARDISBecause he didn't do things the way it should've been done. Because he gave me a quote for a trailer to be built, for $5500  .... [later] he called me into his office and said, listen, that quote I gave you for $5500 doesn't stand. The best I can do is $6000 ...

Gerardis also agreed that, at the time, he was more than happy to assist Costa to obtain a patent, and that he understood there was a financial advantage for Costa to obtain a patent.

From the evidence it is apparent that:

-Gerardis knew at an early date that Costa intended to apply for a patent for the machine;

-until such time as he had a falling out with Costa, Gerardis at all times acceded to Costa proceeding with the patent application alone, and acknowledged to others the existence of the patent application by Costa (alone); and

-his degree of accession went so far as to deliberately not make the Caretti machine known to Costa's patent attorney, as he thought that Costa's chances of getting a patent would thereby be better; neither did Gerardis mention any claim to inventorship at the time of the patent attorney's visit, even though he clearly knew the reason for that visit.

In my view, Gerardis knowingly acceded to Costa applying for a patent in Costa's name only. Further, Gerardis is now seeking to resile from that accession as a consequence of a falling out between them. I think that his initial accession, knowingly done and maintained for a substantial period of time, gives rise to an estoppel in pais (see, for example, Grundt v Great Boulder Pty Gold Mines Ltd [1937] 59 CLR 641 at 674) preventing Gerardis from now claiming that the invention was obtained from him. Consequently, even though I have found that Gerardis is a joint inventor, it is not open for me to find that the invention claimed in 623843 was obtained from him.

Prior Use

The allegation of prior user arises out of the following circumstances:

-building the machine commenced around 2 April 1991;

-the machine was delivered to Gerardis on (or about) 16 May;

-around 20 May, Costa went to Gerardis' property to see the conveyor in use. Costa declares that:

"When we had arrived there, Joe and the other workers were already using the conveyor.";

-Costa declares that "On approximately the 25th May 1991 the first minor improvement took place". The improvement related to a winding wheel for hydraulic hosing;

-on 30 May Costa went to Gerardis' property with his patent attorney;

-during June, a number of modifications were made to the machine - specifically:

-changes to the fold-down legs;

-changes to certain covers;

-changes to the hand-brake;

-provision of guide-rollers for the hose reel;

-a refit of hydraulic outlets; and

-provision of a rubber strip to prevent produce rolling off the conveyor belt;

-the provisional application was filed on 25 June 1991.

From the evidence and the examination it is apparent that:

-during the manufacture of the machine, Costa took no particular steps to maintain the machine in any form of secrecy;

-there was no express arrangement regarding secrecy between Costa and Gerardis;

-the machine was transported to Gerardis without any covering to hide it from public view;

-when the machine was put into operation, neither Gerardis nor Costa was sure that it would work;

-the use of the machine by Gerardis was not subject to the exclusions of the public;

-that other market gardeners soon became aware of the machine, and expressed interest in buying one. Gerardis testified that he demonstrated it to other gardeners within 'a couple of weeks' of receiving it.

-on 5 July 1991 Costa received a $5000 deposit from a D & M Catanzariti for the manufacture of the machine.

The level of proof required in an opposition case to establish prior use is succinctly stated in Seiller's Application [1970] RPC 103, where Graham, J said at pg 106:

"In my judgment it is necessary that proof of prior user in opposition cases should be very clear."

and I add that in proceedings before the Commissioner the standard of proof is the civil standard on the balance of probabilities (see e.g. Dunlop Holdings Ltd's Application [1979] RPC 523), and the opponent or informant carries the onus of establishing the grounds alleged.

For the period of manufacture of the machine, there is no evidence that any member of the public actually saw the machine. I note the lack of any efforts on Costa's behalf to maintain secrecy over the machine, but this is not conclusive of whether the machine was published; there must additionally be clear evidence that the location where the machine was being built was open to members of the public. The informant provided no such evidence, and I do not think the testimony of Costa was such as to establish this by admission. Additionally, Caretti testified that during the construction of the machine, Gerardis kept him informed of its progress; but his testimony did not indicate that he was told anything other than broad generalities of the machine. Hence I conclude that there is no evidence before me to show that the machine was published during this period.

In respect of the transportation of the machine to Gerardis' property, I think Boyce v Morris Motors Ld 44 RPC 105 is pertinent. At pg 149 it was said:

"... the mere fact that these cars were driven on the public highway did not give anybody the opportunity of stopping the car and asking to have a look into the top of the radiator to see what was there. To my mind, there was no greater public user of the invention because the cars were driven upon a public highway, than if the cars had been driven upon a private testing ground ... "

I do not think that the uncovered transportation of the machine, which necessarily was not in its operative position nor operating, resulted in a public use of the invention. In any event, if the subsequent use of the machine before the priority date is protected by section 24(1) (see below), I consider that the transportation of the machine to the location of that use would be similarly protected.

The machine was delivered to Gerardis' property almost six weeks before the priority date of the claims, and was put into use no later than 20 May, with workers using the machine to pick vegetables. It is contended that this use constitutes a publication by prior use; on the other hand the patentee relies upon s.24(1) and regulation 2.2(2)(d), which provides (with the relevant parts of the text of the Act and Regulations combined):

The working in public of the invention within the period of 12 months before the priority date of a claim for the invention:

(i)for the purposes of reasonable trial; and

(ii)if, because of the nature of the invention, it is reasonably necessary for the working to be in public"

must be disregarded when assessing the novelty, or the absence of an inventive step, in a claimed invention.

In this matter I note the speech of Lord Diplock in the House of Lords in Bristol-Myers Company (Johnson's) Application 1975 RPC 127 at 157:

"If the inventor, after discovering how to make (a substance), had himself dealt with the substance commercially before applying for a patent for it, he would be disqualified from obtaining a grant; but this was not because of any prior use of it by others, but for the different reason that the invention having been put by him to "public use" was no longer a manner of new manufacture within the meaning of the Statute of Monopolies. For the other mischief against which the Statute was directed was that even Monopolies of new manufactures should not extend beyond fourteen years. If the inventor had already reaped commercial benefit from a de facto monopoly in his discovery owing to his concealment from all other traders of the way in which the new substance could be made, he was not to be permitted to prolong his monopoly for an additional fourteen years. So "public use" in the sense of commercial dealing in a product claimed as an invention, by any trader even though it were by the inventor himself, rendered invalid any patent for the product claimed ... In the case of use by traders, at any rate, the expression "public use" was not employed to mark the contrast between the public and secret use but to distinguish commercial from experimental use in the course of discovering, perfecting and trying out the invention so as to test its suitability for commercial use ... To sell the product by way of trade, is to "use" it, notwithstanding the seller's ignorance of its identity or his lack of knowledge of its composition or his uncertainty as to how and where further supplies of it could be obtained."

Also, in Andrew Master Hones Ltd v Cruikshank & Fairweather [1981] RPC 389, Buckley L.J. commented thus at p.403:

"When a new device is introduced to the market its commercial use may well have experimental value from the point of view of the inventor or patentee for some time thereafter; but if the use of the apparatus is by no means experimental from the point of view of the customer I doubt whether it can be properly described as for the purpose of trial or experiment only."

From the evidence, there is no doubt that the machine was used by Gerardis for several weeks before the priority date, and that use occurred in a public place (albeit on private property). However, having regard to:

-Costa and Gerardis not knowing, at the time the machine was delivered, whether it would work properly;

-the numerous changes that were made to the machine in the two months following its delivery; and

-the acknowledgement by Gerardis, in para 16 of his first declaration, that the machine was a 'prototype' (which, I note, he disputed in his testimony);

I am satisfied that at the time of its delivery, any use of the machine by Gerardis was necessarily an experimental use. Further, having regard to the nature of the machine, I am satisfied that its use in a market garden was reasonably necessary to conduct proper trials of the machine.  That is, at the time of its delivery, the use of the machine was a use to be disregarded pursuant to s.24(1) of the Act.

I am also satisfied that by 5 July 1991 the machine had entered commercial use, for on that date Costa received a deposit to build another machine. That is, by 5 July experimental use had ceased, with the result that the protection afforded by s.24(1) of the Act was no longer available.

The relevant question is when did the use of the machine cease to be experimental use; in particular, did that occur before 25 June 1991.

In this regard, I observe that I have found Gerardis to be a joint inventor. Thus, although Gerardis was clearly a customer of Costa, I do not consider him to be the customer referred to in Andrew Master Hones Ltd v Cruikshank & Fairweather (supra). Rather I consider the relevant customer to be other market gardeners; persons other than the inventors who have a potential interest in acquiring the machine. Thus the relevant test is whether the other market gardeners, who saw the machine before the priority date, thought that its use was experimental when they saw it.

There is no evidence before me from any of the market gardeners who were said by Gerardis to have seen the machine in use at his property. Thus I am in no position to determine whether they thought its use was experimental, and consequently whether experimental use ceased before 25 June. However the following peripheral factors are of some relevance:

-the deposit was received on 5 July - a date sufficiently far removed from 25 June to preclude me drawing an inference that commercial use necessarily commenced before 25 June.

-the provisional application was made some 6 weeks after the machine was delivered to Gerardis, a period which is not manifestly inconsistent with that required for a reasonable trial of the machine.

-Gino Costa, the patentee's brother and a business partner of Gerardis, declares that on the day the patent application was lodged, "I told [Gerardis] that [the patent attorney] had lodged the patent application and that it was fine for him to show it to who he pleased."

In the absence of evidence from 'other' market gardeners, I consider it appropriate to give the benefit of doubt to the patentee (Commissioner of Patents v Microcell (1959) 102 CLR 232). Consequently, I find that any use of the machine prior to the 25 June 1991 was experimental use, and subject to the protection afforded by s.24(1) of the Act.

Thus, on the evidence before me I conclude that there has been no anticipation by any prior use of the machine.

Novelty

A second declaration by Gerardis accompanying the section 28 notice included a copy of an advertisement in the May 15 1990 edition of The Gatton, Lockyer and Brisbane Valley STAR, and four photographs of a machine.

In so far as the advertisement shows a machine similar to the present invention, it is impossible to ascertain from the advertisement any of the features relevant to the movement (or otherwise) of the boom. The advertisement itself is manifestly inadequate for establishing lack of novelty.

In so far as the photographs are of a machine that appears to fall within the scope of the present claims, the most that can be said is that the photographs appear to be of a machine built by the company that made the above advertisement. There is a complete lack of evidence relating the machine photographed to what was known before the priority date, and it is clear that the photographs were taken well after the priority date of the present claims.

Consequently, I find that the invention claimed is not anticipated by this material.

Conclusion

I have found that:

-Costa and Gerardis are joint inventors of the invention;

-by his actions, Gerardis is estopped from claiming that the invention was obtained from him;

-the allegation of prior use has not been made out, any prior use being for reasonable trial and subject to the protection afforded by s.24(1); and

-lack of novelty based on a newspaper advertisement is not established.

Consequently, I grant the extension of term of the petty patent.

Costs

In matters before the Commissioner, costs usually follow the event, and I see no reason to vary this. I award costs against the informant, GR & IE DAKING PTY LTD.

In accordance with the Commissioner's conditions for conducting interstate hearings out of session, the amount paid by the parties for my attendance in Adelaide is excluded from this award of costs.

D. HERALD

Delegate of the Commissioner of Patents

Patent attorneys for the patentee  :  A.P.T. Patent and Trade Mark Attorneys, Adelaide

Patent attorneys for the informant :  R K Maddern & Associates, Adelaide