David Gerard Clark v Ronald Neville Langford

[2009] APO 19

ABSTRACTS OF DECISIONS

DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS

Patent:          No. 755035 in the name of Ronald Neville Langford

Title:          Method of Locating Web-Pages by Utilising Visual Images

Action: Request under section 223 of the Patents Act 1990 for an extension of time to pay 6^th year renewal fee by Ronald Neville Langford and an opposition thereto by David Gerard Clark

Decision:          Issued  30 September 2009.

Abstract

It has not been established that patentee or his agent, PSL Management Pte Ltd, made an error or omission in failure to pay the 6^th year renewal fee for the patent for the purpose of paragraph 223(2)(a) of the Patents Act 1990.

An extension of time under paragraph 223(2)(a) is not appropriate.

Costs were awarded against the patentee.

PATENTS ACT 1990

DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS

Re:Patent No. 755035 in the name of Ronald Neville Langford and an opposition by David Gerard Clark to a request for an extension of time under section 223 to pay 6^th year renewal fee   

BACKGROUND

1. Patent application 93479/2001 (herein after referred to “the application”) directed to a Method of Locating Web-Pages by Utilising Visual Images was filed on 3 October 2001 by Goldspirit Investments Pty Ltd under the provisions of the Patent Cooperation Treaty. The application proceeded to acceptance and was advertised accepted on 28 November 2002. Ownership of the application was transferred to Mr Ronald Neville Langford on 23 December 2002. The application was subsequently sealed as patent number 755035 (herein after referred to “the patent”) on 13 March 2003. The 6^th year renewal fee for the patent was due on 3 October 2007. The patent was advertised as ceased on 5 June 2008 due to non-payment of 6^th year renewal fee.

2. Mr Langford filed an application for extension of time to pay 6^th year renewal fee beyond the 6 months grace period in respect of the patent under subsection 223(2) of the Patents Act 1990 and subregulation 22.11(3) of the Patents Regulations 1991 on 30 May 2008. The application for extension of time was advertised on 17 July 2008.

3. On 25 August 2008, Mr David Gerard Clark filed a notice of opposition to the application for extension of time. A statement of grounds and particulars in support of the opposition was filed on 25 November 2008.

4. On 8 December 2008, Mr Langford filed a request to dismiss the opposition under regulation 5.5 of the Patents Regulations 1991. The request to dismiss the opposition was heard by a delegate of the Commissioner and a decision was issued as Ronald Neville Langford v David Gerard Clark [2009] APO 5 on 16 March 2009. In that decision, the delegate directed Mr Clark to file further and better particulars in relation to two grounds of opposition.

5. Pursuant to the decision of the delegate of the Commissioner, Mr Clark filed an amended statement of grounds and particulars which was allowed on 28 April 2009.  

6. No evidence in support, and hence no evidence in answer and reply were served.  

7. The matter was heard in Canberra on 2 September 2009.  Mr Chris Carter, assisted by Mr Simon Reynolds, of the patent attorney firm Davies Collison Cave, Sydney represented the patentee. Mr Christian Dimitriadis (Counsel), assisted by Mr Duncan Longstaff, of the patent attorney firm Black Dawson, Melbourne represented the opponent.

THE PARTICULARS

8. The amended statement of grounds and particulars indicates that the extension of time to pay renewal fee is opposed under paragraph 223(2)(a), paragraph 223(2)(b) and subregulation 22.11(3). In regard to paragraph 223(2)(a), it is stated that there is no or insufficient evidence to suggest that there was an error or omission by the person concerned or by his or her agent or attorney. In regard to paragraph 223(2)(b), it is stated that there is no or insufficient evidence to suggest that there were circumstances beyond the control of the person concerned. Regarding subregulation 22.11(3), the particulars assert that this provision can not be a basis on which extension of time may be applied.

APPLICATION FOR EXTENSION OF TIME

1. The application for extension of time requests an extension of time of 2 months from 3 April 2008 to 3 June 2008 for the purpose of payment of 6^th year renewal fee beyond the 6 months grace period. The circumstances in which, and the grounds upon which, the application is made is stated to be as follows:

“Section 223(2) and Regulation 22.11(3) are relied upon, and the circumstances are given in a Statutory Declaration that will follow.”

10.The request was later supplemented with a single statutory declaration from each of Mr Langford and Mr Paul Francis Smith.

11.Mr Langford is the legal owner of the patent. The Langford declaration states that he provided verbal instructions to pay the renewal fee to Mr Smith some months prior to 3 October 2007, and was under the impression that the 6^th year renewal fee would be paid before the due date of  3 October 2007. The Langford declaration confirms that it was at all relevant times his intention to pay the fee before the due date.

12.Mr Smith is the managing director of PSL Management Pte Ltd (hereinafter referred to “PSL Management”), a private management consultancy company based in Singapore.  The Smith declaration states that he was verbally instructed that his company should pay the 6^th year renewal fee before the due date of 3 October 2007. The declaration further states that it was Mr Smith’s intention at the time to follow the instruction to pay the renewal fee, however due to his health conditions, periods of hospitalisation and post operative treatment, he inadvertently omitted to pay the fee.    

EVIDENCE

13.No evidence in support, and hence no evidence in answer and reply were served.

SUBMISSIONS AT THE HEARING

14. During the hearing, Mr Carter submitted that he was not relying on paragraph 223(2)(b) and subregulation 22.11(3) as basis for the application for an extension of time. Therefore, I will not comment on the grounds of opposition that relate to the above parts of the legislation.

15. I will provide the details of what is contained in the declarations, and the details of the parties’ submissions, where relevant, later in my decision.

DECISION

Law Relating to Extension of Time under Section 223

16. Section 223(2) of the Patents Act 1990 provides that:

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.

17. Section 223(11) of the Patents Act 1990 further provides that:

(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), and includes the making of a Convention application within the time allowed for making such applications.

18. It is well settled that in the context of section 223(2), the “relevant act” includes payment of renewal fee for a patent.

19. Paragraph 223(2)(a) operates in circumstances where the failure to do a relevant act is the result of an "error or omission". That is, the error or omission must be causally related to the failure to act. This is to be contrasted with the situation where there has been a deliberate decision not to do the relevant act (Weir Pumps Ltd v Commissioner of Patents and Stork Pompen BV 13 IPR 163 at 166-167).

20. The question of what constitutes an error or omission requires careful consideration.  In Kimberly-Clark v Commissioner of Patents (No 3) 13 IPR 569 at 579-580, Jenkinson J discussed the phrase "error or omission" as it applied in section 160 of the Patents Act 1952, the predecessor of section 223, in the following terms:

"It is in my opinion difficult to suppose that only the inadvertence and accidental steps, and not errors resulting from faulty reflection, of the former class of persons were intended by the draftsman to be within s 160(1). Further, the word ‘error' is not easily assigned a clear meaning restricted by reference to one or several particular categories of flawed mental function. The attempt is likely to lead to the drawing of fine and often unrealistic distinctions. And some errors of judgement by agents and attorneys may be as bizarre and as little to be anticipated as lapses of memory and accidental slips."

21. It is clear from the wording of paragraph 223(2)(a) that an error or omission is separate from the failure to do the relevant act. Therefore, the failure to do the relevant act in itself cannot constitute an error or omission. Jenkinson J in Kimberly-Clark (supra) at 580 accepted that:

"… the failure to do the act or to take the step postulated in respect of an application for exercise of the power conferred by s 160(2)(a) cannot itself be the `error or omission' by reason whereof the failure occurred "

but rejected the proposition that section 160 excluded errors or omissions that were the products of deliberation.

22. Consequently, the phrase "error or omission" should be interpreted broadly as including breakdowns in procedure, or flawed mental functions such as an error of judgement (Total Peripherals Pty Ltd v IBM and Commissioner of Patents (1998) AATA 784 and Oz Technology v Boral Energy (1999) APO 18).

23. Jenkinson J in Kimberly-Clark (supra) at 580 also noted that:

"By no means every judgement by the `person concerned' or by `his agent or attorney' which can be shown to have been mistaken will answer the description `error or omission' in the ordinary meaning of those words, which in their context carry, in my opinion, a connotation of obviousness in error."

Thus, for instance, taking a calculated risk would be beyond the meaning of "error or omission" (International Business Machines Corporation v Total Peripherals Pty Ltd [1998] APO 14).

24. The importance of the intention of the person making an application for an extension of time was discussed in Stork Pompen BV v Weir Pumps Ltd 11 IPR 542 at 546:

“A review of recent sub-s 160(2)(a) extension decisions indicates that an error or omission has been considered to have occurred where there has been a breakdown in procedure in effecting a party's intention in respect of an invention or application.  Such cases indicate that having decided a course of action in respect of an act or step the performance of which is required within a certain time under the Act, that intention has been frustrated by either an error (eg the act has been done incorrectly, or mistakenly done outside the time allowed) or due to an omission (eg the act has not been done due to neglect or inadvertence).  Therefore in my view, it is appropriate to consider in relation to the person seeking the extension, that person's intention with respect to doing the act or taking the step, and to determine whether any error or omission arose to frustrate that intention."

25. The relationship between the error or omission and the failure to do an act is of cause and effect, and the error will be seen as thwarting an intention to do the act. This is consistent with the need for a "sufficient causal connection" between the error or omission and the failure to do the relevant act as noted by Jenkinson J in Kimberly-Clark (supra) at 582.

26. I note that section 223 confers a discretionary power, and if the “sufficient causal connection” is established, then there is a need to decide whether, as a matter of discretion, an extension of time should be granted.

27. Therefore, I will first decide whether an error or omission can be identified which establishes a chain of causation to the failure to pay 6^th year renewal fee for the patent within the prescribed period.  If this is the case, then I will decide whether, as a matter of discretion, an extension of time should be granted.

Submission by the parties

28. Mr Dimitriadis, counsel for the opponent, criticised the Langford and Smith declarations as vague and lacking in specific details in many respects.  He submitted that significant matters are not dealt with in the declarations filed by the patentee in the present case – matters one would have expected to be dealt with, had the facts been favourable to the patentee. He argued that the Commissioner should proceed on the basis that such further evidence as the patentee was in a position to adduce from either himself or Mr Smith would not have assisted his case, particularly so in the circumstances where the inadequacy of the patentee’s evidence was expressly raised by the opponent in its original and revised statements of grounds and particulars.

29. Taking the matter further, Mr Dimitriadis argued that the declaration provided by Mr Langford and Mr Smith do not reveal anything which could be considered to be an “error or omission” for the purpose of paragraph 223(2)(a). He stated that the Langford declaration merely indicates that the responsibility for the payment of the fee was given to Mr Smith’s company, while the Smith declaration that he “inadvertently omitted to arrange payment” does not identify any relevant “error or omission” except the non-payment of renewal fee, which is the failure to do the relevant act. Mr Dimidiates submitted that the Smith declaration does not establish that there was a causal link between his health conditions and the failure to pay the renewal fee, and as on his evidence, for a period of at least several weeks either side of the due date of 3 October 2007, he was not subject to any hospitalisation for his condition. Mr Dimitriadis also argued that the fee could have been paid at any time up to 3 April 2008 (the expiration of the 6 months grace period) because Mr Smith does not suggest that any of the circumstances affected him in the year 2008.

30. Mr Dimitriadis also argued that PSL Management Pte Ltd, and not Mr Smith individually, was engaged to provide the renewal services. He submitted that Mr Smith describes himself as the managing director of the PSL Management, and one would expect that other employees should have been able to stand in for Mr Smith, if necessary, to arrange for payment of the renewal fee for PSL Management’s clients.

31. Mr Carter, the patentee’s attorney, submitted that at all relevant times it was the intention of Mr Langford and Mr Smith to pay the renewal fee for the patent before the renewal date of 3 October 2007, and directed my attention to item 7 of the Langford declaration and items 5 and 9 of the Smith declaration, which demonstrate that there was an intention to pay the renewal fee. He stated that Mr Smith’s health conditions were contributing factors to the inadvertent error or omission to pay the renewal fee and that there was no conflicting instruction or decision by Mr Smith or Mr Langford not to pay the fee. Mr Carter argued that the Smith declaration demonstrate at least “lapse of memory” or accidental slips”, and thus the existence of error or omission that resulted in the non payment of fee.

32. Mr Carter also contended that G S Technology Pty Limited v Commissioner of Patents [2004] FCA 1017 is the most relevant authority to be applied to the present circumstances and concerns a similar fact scenario, and that the facts in Kimberly- Clark (supra) are distinguished in that this case concerns an extension of time to file a notice of opposition, and importantly the application for the extension of time was filed before the relevant deadline, which brought causation into dispute. Mr Carter asserted that there was no causation issue in the patentee’s case. He further submitted that in G S Technology (supra), Spender J has already considered and applied the principles of Kimberley-Clark (supra) to a fact scenario quite similar to the present circumstances and, therefore, it is appropriate for the Commissioner to apply the reasoning found in G S Technology (supra) to the present factual circumstances.

Error or Omission

33. The relevant parts of Langford declaration read as follows:

“5. Some months prior to 3 October 2007, I changed responsibility for the Management of renewals for my patent portfolio, including the patent, from CPA to PSL Management Pte Ltd, of #06-02 121 Meyer Road, 437932, Singapore (“PSL Management”).

6.  During the transition of responsibility I verbally provided my instructions to proceed to pay future renewal fees for the patent as they fall due to Mr Paul Francis Smith, Managing Director of PSL Management.

7. I was thus under the assumption that the 6th year renewal fee would be attended to and paid by PSL Management before the due date of 3 October 2007.

...

11. I confirm that it was at all relevant times my intention to pay the 6^th year renewal fee before the due date of 3 October 2007.”

34. It is clear from the Langford declaration that it was Mr Langford’s intention to pay the fee and he placed the responsibility on PSL Management. While Mr Langford is not very specific about how long prior to 3 October 2007 he provided the verbal instructions to Mr Smith, it is clear that it was before 3 October 2007. Therefore, it appears that no error or omission took place on the part of Mr Langford.

35. Consequently, the reliance for identifying the error or omission is placed on the Smith declaration which reads as follows:

“1.   I am the Managing Director of PSL Management Pte Ltd, of #06-02 121 Meyer Road, 437932, Singapore (‘my company”), a private management consultancy.

2.   Prior to October 2007 my company was engaged by Ronald Neville Langford to provide patent renewal services for a patent portfolio which included Australian Patent No. 755035 (“the Patent”).

3.   As part of the engagement of my company, I was made aware that the 6^th year renewal fee for the patent was due before 3 October 2007.

4.   During a discussion with Ronald Neville Langford concerning the appointment of my company I was verbally instructed that my company should proceed to pay 6^th year renewal fee for the patent, amongst other renewal fees for foreign patents, before the due date of 3 October 2007.”

36. It is evident from the above statements that PSL Management, and not Mr Smith individually, was engaged to pay the renewal fee. Therefore I need to determine whether PSL Management made an error or omission in its failure to pay the renewal fee.

37. The Smith declaration further reads as follows:

“5.  It was my intention at the time to follow those instructions, however, due to a number of health conditions requiring hospitalisation and treatment that arose during the year of 2007 my business activities were disrupted and were in disarray.

6.   The dates of hospital attendances at the Raffles Hospital Singapore and associated health conditions were: [various dates from March 2007 - June 2007, and November 2007 along with the health conditions have been provided].

7.   I was also required to undergo post-operative treatment throughout the year of 2007.

8.   As a result of my health conditions, periods of hospitalisations and post-operative treatment, I inadvertently omitted to arrange payment of the 6^th year renewal fee for the patent.”

38. The above statements suggest that Mr Smith, due to his health conditions omitted to pay the fee. Here it is noteworthy that for at least 3 months prior to 3 October 2007, Mr Smith was not subject of any hospitalisation for his conditions. In any case, the main question before me is whether there was an error or omission on the part of PSL Management, the agent for Mr Langford.

39. There is no evidence before me about the role of Mr Smith in PSL Management other than that he describes himself as the Managing Director of the company. The Smith declaration states that PSL Management is a private management consultancy and that the company was engaged to provide patent renewal services for a patent portfolio. However, there is no information in the declarations about the structure of the company, number of people it employed, and how the responsibility for payments of renewal fees for the clients was managed. I have no evidence about the arrangements made by PSL Management to carry out its operations in light of Mr Smith’s ongoing health conditions in the year 2007. Furthermore, there is no evidence before me whether a reminder system was employed by PSL Management to manage payment of renewal fees for a patent portfolio, and whether reminders or alerts were received.

40. In the present case, everything hinges on Mr Smith’s statement that “I inadvertently omitted to arrange payment…”. This implies inadvertence but is completely silent on details. It may be that Mr Smith was personally responsible for paying the fee and he simply forgot. It is also possible that Mr Smith failed to enter payment details into a reminder system, or failed to instruct another employee of PSL Management to pay the fee. It may also be that Mr Smith correctly instructed another employee of PSL Management to pay the fee but there may have been a failure to pay on that employee’s part. However, there is no evidence to support any of these conjectures.

41. It is also possible that Mr Smith simply failed to pay the fee in the absence of a relevant error. When all reasonable scenarios involve an error or omission, then an error or omission may be assumed even though the exact nature of the error or omission is not certain. However, when it is plausible that there was no error or omission, as in the present case, then the patentee has not established that PSL Management made an error or omission in its failure to pay the renewal fee.

42. Although the declarations state that there was an intention on the part of the patentee and Mr Smith to pay the fee, that alone can not be a basis for the grant of an extension of time under paragraph 223(2)(a). To satisfy the requirement of the Act, it must be shown that the patentee or his agent made an error or omission. In the present case, there is insufficient evidence before me that the failure to pay the renewal fees was due to an error or omission by Mr Langford or his agent, PSL Management.

Other Matters

43. Mr Carter submitted that an attempt was made to remedy the error or omission as soon it was discovered and if the extension of time was not granted the consequences will be drastic and the patent will irretrievably lapse despite a clear desire to maintain the patent. Mr Carter further submitted that the patentee is an individual and has already incurred substantial expense through no fault of his own, in seeking revival of his patent. Mr Carter submitted that other interests are protected through the provisions of section 223(9) and (10) which provide for the protection or compensation for those who exploited the invention during the lapse of a patent.

44. The above matters are relevant to the exercise of discretion in granting the extension of time. While I am mindful that the patentee could be disadvantaged due to the refusal of extension of time, there is a need to establish that the failure to pay the fee occurred due to an error or omission by the patentee or his agent in accordance with the provisions of paragraph 223(2)(a) of the Patents Act 1990, and that onus has not been met.

CONCLUSION

45. It has not been established that patentee or his agent, PSL Management Pte Ltd, made an error or omission that caused the failure to pay the renewal fee. I am not satisfied that an extension of time under paragraph 223(2)(a) is appropriate.

COSTS

46. Ordinarily in proceedings such as these, costs follow the event.  There appears to be no special circumstances applying in relation to this matter which warrant varying that approach.  Therefore, I award costs in accordance with Schedule 8 of the Patent Regulations against the patentee, Mr Langford.

Dr S. K. Aggarwal
Delegate of the Commissioner of Patents
30 September 2009

Patent attorneys for the patentee   : Davies Collison Cave, Sydney

Patent attorneys for the opponent   : Black Dawson, Melbourne