FEDERAL COURT OF AUSTRALIA
CQMS Pty Ltd v Simco Mining Products & Services Pty Ltd [2014] FCA 1423
Citation: CQMS Pty Ltd v Simco Mining Products & Services Pty Ltd [2014] FCA 1423 Parties: CQMS PTY LTD ACN 122 935 906 v SIMCO MINING PRODUCTS & SERVICES PTY LTD (FORMERLY L & H INDUSTRIAL AUSTRALIA PTY LTD) ACN 143 658 100 File number: QUD 787 of 2012 Judge: DOWSETT J Date of judgment: 23 December 2014 Catchwords: PATENTS – amendments – innovation patents – where proceedings commenced alleging infringement – where particulars of invalidity caused application for amendment to claims of patents – whether proposed amendment permitted by s 102 of the Patents Act 1990 (Cth) – whether discretion should be exercised to refuse amendment. Legislation: Patents Act 1990 (Cth) ss 40, 88, 102, 105
Patents Amendment (Patents Cooperation Treaty) Act 1979 (Cth)Cases cited: Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd (2012) 99 IPR 59
British Thomson-Houston Co Ltd v Corona Lamp Works Ltd (1921) 39 RPC 49
Décor Corporation Pty Ltd v Dart Industries Inc (1988) 13 IPR 385
Gambro Pty Ltd v Fresenius Medical Care South-East Asia Pty Ltd (1999) 48 IPR 625
Jupiters Ltd v Neurizon Pty Ltd (2005) 222 ALR 155
Les Laboratoires Servier v Apotex Pty Ltd (2010) 273 ALR 630
Monsanto Co v Commissioner of Patents (1974) 48 ALJR 59
Smith Kline & French Laboratories Ltd v Evans Medical Ltd [1989] FSR 561
Wimmera Industrial Minerals Pty Ltd v RGC Mineral Sands Ltd (No 3) (1997) AIPC 91–366Date of hearing: 3 February 2014 Place: Brisbane Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 81 Counsel for the Applicant: Mr A Crowe QC and Mr S Cooper Solicitor for the Applicant: Thomsons Lawyers Solicitor for the Respondent: BlueFOX Legal
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 787 of 2012
BETWEEN: CQMS PTY LTD ACN 122 935 906
ApplicantAND: SIMCO MINING PRODUCTS & SERVICES PTY LTD (FORMERLY L & H INDUSTRIAL AUSTRALIA PTY LTD) ACN 143 658 100
Respondent
JUDGE:
DOWSETT J
DATE OF ORDER:
23 DECEMBER 2014
WHERE MADE:
BRISBANE
THE COURT ORDERS THAT:
1.the complete specification of Australian patent number 2012100452 be amended in the terms specified in annexure “AL‑31” to the affidavit of Adam Luxton filed 18 October 2013; and
2.the complete specification of Australian patent number 2012100453 be amended in the terms specified in annexure “AL‑35” to that affidavit.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
QUD 787 of 2012
BETWEEN: CQMS PTY LTD ACN 122 935 906
ApplicantAND: SIMCO MINING PRODUCTS & SERVICES PTY LTD (FORMERLY L & H INDUSTRIAL AUSTRALIA PTY LTD) ACN 143 658 100
Respondent
JUDGE:
DOWSETT J
DATE:
23 DECEMBER 2014
PLACE:
BRISBANE
REASONS FOR JUDGMENT
THE PROCEEDINGS
The applicant (“CQMS”) has commenced proceedings alleging infringement of innovation patents AU2012100452 (“patent 452”) and AU2012100453 (“patent 453”). The…
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Details
- Case
- [2014] FCA 1423
- Decision Date
CaseChat Overview and Summary
The case of CQMS Pty Ltd v Simco Mining Products & Services Pty Ltd concerns an application by CQMS to amend the claims of its innovation patents 2012100452 and 2012100453. The Federal Court was tasked with determining whether CQMS was entitled to amend the patents and whether the court should exercise its discretion under section 102 of the Patents Act 1990 (Cth) to refuse the amendment. The dispute arose when Simco raised particulars of invalidity, alleging that the patents were not novel. In response, CQMS applied to amend the patents to address the alleged invalidity.
The court had to decide whether the proposed amendments to the patents were permitted under section 102 of the Patents Act and whether the exercise of discretion should result in the refusal of the amendment. Section 102(3) of the Patents Act allows for amendments to patent claims if the court considers it appropriate. The court's discretion to refuse an amendment is broad and is to be exercised in light of all relevant circumstances. The primary considerations in this case were whether CQMS had provided full and frank disclosure, whether the amendments were necessary and appropriate, whether CQMS's conduct warranted refusal of leave, and the potential for prejudice and public interest.
The court examined the evidence and submissions from both parties, including the affidavits of patent attorneys and solicitors from both sides. The court found that CQMS had provided a full and frank disclosure of the reasons for the proposed amendments and that the amendments were necessary and appropriate given the prior art cited by Simco. The court also noted that Simco had not fully disclosed relevant prior art prior to the commencement of proceedings, which contributed to the need for amendments. The court concluded that there were no grounds to refuse the exercise of discretion under section 102 of the Patents Act.
The court ordered that the complete specification of Australian patent number 2012100452 be amended in the terms specified in annexure "AL-31" to the affidavit of Adam Luxton filed 18 October 2013 and that the complete specification of Australian patent number 2012100453 be amended in the terms specified in annexure "AL-35" to that affidavit.
The court had to decide whether the proposed amendments to the patents were permitted under section 102 of the Patents Act and whether the exercise of discretion should result in the refusal of the amendment. Section 102(3) of the Patents Act allows for amendments to patent claims if the court considers it appropriate. The court's discretion to refuse an amendment is broad and is to be exercised in light of all relevant circumstances. The primary considerations in this case were whether CQMS had provided full and frank disclosure, whether the amendments were necessary and appropriate, whether CQMS's conduct warranted refusal of leave, and the potential for prejudice and public interest.
The court examined the evidence and submissions from both parties, including the affidavits of patent attorneys and solicitors from both sides. The court found that CQMS had provided a full and frank disclosure of the reasons for the proposed amendments and that the amendments were necessary and appropriate given the prior art cited by Simco. The court also noted that Simco had not fully disclosed relevant prior art prior to the commencement of proceedings, which contributed to the need for amendments. The court concluded that there were no grounds to refuse the exercise of discretion under section 102 of the Patents Act.
The court ordered that the complete specification of Australian patent number 2012100452 be amended in the terms specified in annexure "AL-31" to the affidavit of Adam Luxton filed 18 October 2013 and that the complete specification of Australian patent number 2012100453 be amended in the terms specified in annexure "AL-35" to that affidavit.
Orders
Orders of the court
1. the complete specification of Australian patent number 2012100452 be amended in the terms specified in annexure “AL‑31” to the affidavit of Adam Luxton filed 18 October 2013; and
2. the complete specification of Australian patent number 2012100453 be amended in the terms specified in annexure “AL‑35” to that affidavit.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
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Evidence
Evidence Before The Court
CQMS submits that there are no matters which might cause me to decline to make the orders sought. Simco submits that for a number of reasons I should decline to make those orders. Simco’s grounds of opposition, as argued may be grouped under five headings as follows:·failure to provide full and frank disclosure as to reasons for the proposed amendments;·failure to provide full and frank disclosure of all matters relevant to the Court’s discretion;·the proposed amendments are not necessary or appropriate; ·the applicant has engaged in conduct such that leave should be refused; and·prejudice and public interest.THE EVIDENCE Before considering the exercise of the discretion, I should set out relevant aspects of the evidence. None of the deponents was cross‑examined. The witnesses were Mr Luxton, CQMS’s patent attorney, Mr Coogan, CQMS’s solicitor, Mr Anderson, Simco’s patent attorney, and Mr Fox, Simco’s solicitor. Mr Luxton’s evidence was extensive. Later, I shall refer to it in some detail. Mr Coogan’s evidence is largely formal. Apart from exhibiting documents, he deals with two matters. The first is the history of these proceedings from 6 February 2013 until the hearing on 3 February 2014. The second concerns a statement by Mr Luxton that the Patent Office had received the proposed amendments and was prima facie satisfied that they met the requirements of s 102. Mr Anderson sought to obtain any documents held by the Patent Office, which documents dealt with the proposed amendments. He was told that there were no such documents, and that the statement by the Patent Office, that it was prima facie satisfied as to compliance with s 102, was a “standard letter”. Mr Anderson inferred that the Patent Office “had [not] reviewed the applications for amendment nor the proposed amendments …”. Mr Coogan responded, setting out information from the Patent Office which indicated that it had reviewed the proposed amendments, and that it considered that prima facie, they satisfied the requirements of s 102. As far as I can see, the matter is of no important in this case. Mr Anderson also exhibits a number of documents. Mr Fox exhibits correspondence between his firm and CQMS’s lawyers, which documents had not been exhibited by Mr Coogan. Mr Luxton swore two affidavits. In the second affidavit, he exhibited a copy of a patent not directly relevant to the case, patent 2013100565 (“patent 565”). An associated patent, patent 2013100566 (“patent 566”), is exhibited to the affidavit of Mr Anderson. Concerning these patents, Mr Luxton also provided information of a formal nature. His first affidavit is of primary importance in this case. In it he:·identifies the relevant patent applications;·describes the procedural history of patent applications 452 and 453;·exhibits CQMS’s letter of demand and Simco’s reply;·describes his process of reasoning concerning the validity of patents 452 and 453; and·sets out the procedural history of the applications for amendment.The patent applications and procedural history
Decision
Reasons for decision
A statement of claim was filed with the application. On 22 March 2013 the defence, notice of cross‑claim, statement of cross‑claim and particulars of invalidity were delivered. In those documents Simco alleged that patents 452 and 453 were invalid on various grounds, including for want of novelty. Reference was made to various items of prior art. The decision to amend After receipt of the particulars of invalidity on 22 March 2013, Mr Luxton considered the validity of patents 452 and 453 in light of the prior art cited by Simco. By 10 April 2013 he had formed the view that patent 452 was entitled to priority only from 13 December 2010. This conclusion did not have any bearing on the validity of the patent. However Mr Luxton considered that in light of one item of prior art cited by Simco, claims 1 to 3 of patent 452 were not novel. The item in question is described as WO2002/101160. Although that item had previously been raised in connection with inventiveness, it had not been cited as going to novelty. Mr Luxton also considered that in light of nine items of prior art cited by Simco concerning the 453 patent, all of the claims of that patent lacked novelty. Of those nine items, five had not previously come to Mr Luxton’s attention. The other four had come to his attention, but only in respect of inventiveness. I should point out that in a letter from Simco’s solicitors to CQMS’s solicitors dated 5 February 2013, one of the nine items, US6467203, was cited as going to the novelty of patent 453. There is no evidence that the letter was forwarded to Mr Luxton. In some circumstances one would have expected the solicitors to have done so. However, as service of the defence, cross‑claim and particulars of invalidity was imminent, it was reasonable to await service of those documents. Further, in the letter of 5 February 2013 Simco’s solicitors had expressly stated that the citation of the identified items of prior art was not intended to limit Simco’s “position” in any way. Thus it was not a final list. Having considered the cited prior art and reached these conclusions, Mr Luxton decided that CQMS should seek to amend the patents. According to Mr Coogan, between 16 May and 15 July 2013, the parties negotiated on a “without prejudice” basis. They failed to reach agreement. At that point CQMS instructed Mr Luxton to apply to amend the patents. At a directions hearing on 29 July 2013 counsel informed me that CQMS intended so to apply. I ordered that the parties file agreed directions as to the future conduct of the application for amendment. The parties could not agree. On 30 August 2013 the applications to amend were filed in the Patent Office. On 30 August 2013 the solicitors for CQMS wrote to the solicitors for Simco, asserting that Simco had not complied with its obligations to take genuine steps to resolve the dispute before the commencement of civil proceedings. In particular, they suggested that it had not, prior to 5 February 2013, provided details of relevant prior art going to the issue of novelty. The solicitors asserted that it was not until 22 March 2013 (when the defence and associated documents were filed) that Simco had fully identified the relevant prior art for both patents. The solicitors suggested that this conduct had led to the incurrence of additional costs, particularly in connection with CQMS’s application for leave to amend.
Ratio Decidendi
Legal Principle Established
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