Dynamic Data Systems Pty Ltd v Ingenico International (Pacific) Pty Ltd

[1998] APO 62

OFFICIAL NOTICE

DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS

Petty Patents  :          No. 669321 and 669322 in the name of Dynamic Data Systems Pty Limited

Title:          Funds transaction device

Action:           Notices under Section 28 by Ingenico International (Pacific) Pty Ltd and an application by the Patentee for further time in which to file evidence in response.

Decision:          Issued            .

Abstract

The request for the extension of time is refused and the substantive hearing is set for 21 December 1998. 

PATENTS ACT 1990

DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS

Re:Petty Patents No. 669321 and 669322 in the name of Dynamic Data Systems Pty Ltd, notices under Section 28 by Ingenico International (Pacific) Pty Ltd and an application by the Patentee for further time in which to file evidence in response.

background

Australian petty patents 669321 and 669322 were filed as divisional applications of 66417/94 on 7 March 1996 by Dynamic Data Systems Pty Limited (Dynamic).  Both petty patents were sealed on 30 May 1996.

Notices under section 28 were filed by Ingenico International (Pacific) Pty Ltd (Ingenico) on 10 April 1997 together with notification of invalidity proceedings in the Federal Court (NG763/96).  Applications for extension of the terms of the petty patents were filed on 17 April 1997.

The time set initially for evidence in response ended on 5 December 1997 but three subsequent requests for further time to 5 September 1998 were allowed.  On 2 September 1998, Dynamic sought a further extension of one month to 5 October 1998 but this was opposed by Ingenico and the matter was set for hearing on 14 October 1998.  The delegate issued a decision on 15 October 1998 which refused the extension but allowed the patentee 14 days from the date of the decision in which to file evidence in response to the section 28 Notices.

On 29 October 1998, the patentee filed a further request for an extension of time.  The informant objected to the extension and a hearing to consider the extension was set for 13 November 1998.  Dynamic was represented by Mr Stephen Wilson of Griffith Hack, patent attorneys, Melbourne and Ingenico by Mr Peter Silver assisted by Ms Caroline Lovell, of Clayton Utz, lawyers of Sydney, both by telephone.

SUBMISSIONS

In the decision issued on 15 October 1998 in relation to the last extension of time request filed on petty patents 669321 and 669322, the delegate concluded that the extension of time was not justified but allowed Dynamic a relatively short period of time (14 days) to finalise and serve any evidence on hand.

The 14 day period set by the delegate in the decision of 15 October 1998 ended on 29 October 1998.  On that date, Dynamic applied for a 1 month extension until 29 November 1998.  They also anticipated in that letter that there could be further extensions beyond 29 November 1998.  The reasons provided to justify the extension were:

"Unfortunately, we are not in a position to file and serve evidence.  The files relating to this matter have not yet been transferred to us from the solicitors previously handling the litigation and responsible for preparation of expert evidence to be used in the litigation and which was to be used in these petty patent proceedings.

We are hopeful that the files will shortly be transferred.  If the files are not transferred shortly our client contemplates petitioning to the Federal Court for an order requiring hand over of the files.

A Direction Hearing in the corresponding Federal Court proceedings was conducted on 22 October 1998 and that before Justice Branson.  In view of the change of solicitors and the fact the files were not in the possession of ourselves or the new solicitors, the matter was set over for 30 days.  This time was allowed so that the files could be reviewed and considered and an assessment made as to how long was required before evidence could be prepared and finalised.

In the circumstances we have no option but to request a further extension of time of 1 month from 29 October 1998."

At the hearing, Mr Wilson said that his firm (Griffith Hack) had not been involved in the preparation of the evidence for the section 28 matter and that they had been taking instructions regarding the progress of the evidence from the previous solicitors.  This changed in late October 1998 when Dynamic engaged Griffith Hack to complete the evidence in response.  Mr Wilson received the partially completed evidence (in 92 lever arch volumes of material) from the previous solicitors on 2 November 1998.  Having sorted through this material, he identified the relevant evidence as:

• 2 partially completed statutory declarations which (according to Mr Wilson) still required some work to complete.

• hand written notes by a solicitor from discussions with a third witness.  Mr Wilson suggested these could be used to draft a third declaration.

Mr Wilson suggested that given the Christmas break, the evidence could realistically be completed by early February, 1999.

Mr Silver, for the Informant argued that the difficulties now faced by Mr Wilson because of only recently receiving the evidence were irrelevant.  Dynamic had ample time prior to the change in the solicitors to prepare their evidence (5 requests for extensions of time had already been granted).  They did not satisfactorily explain why they were unable to complete their evidence prior to the change in solicitors despite advising the Patent Office that they would be ready to file their evidence in June 1998.  Mr Silver made the analogy that blaming the change in solicitors for lack of progress in the evidence was like blaming a cab driver for being 5 minutes late to the airport when the plane had left the previous day.

The Informant further submitted that:

• By its continued disregard for the time limits determined by the delegate without any reasonable explanation, Dynamic have forfeited the right to rely on public policy considerations that might otherwise operated in its favour.
  
  

• The application should properly be refused in the light of Dynamic's failure to respond to what was clearly expressed by the delegate on 15 October 1998 as a final opportunity to avoid being shut out.  A further extension would undermine the procedures, authority and efficient operation of the Patent Office, be inconsistent with the maintenance of high professional standards by those who deal with the Patent Office and be contrary to every aspect of public interest.

DECISION

The time period in which a Patentee may respond to a Notice filed under Section 28 is not prescribed in the Patents Act or Regulations. It is a matter entirely within the discretion of the Commissioner, acting of course within the principles of natural justice and procedural fairness.

However, the Commissioner's discretion is essentially exercised in the same way as it might be under Regulation 5.10 and the law as it applies to that regulation is also generally relevant to the present matter. In this regard I am guided by the decisions of Burchett J in Ferocem Pty Ltd v Commissioner of Patents (1994) 28 IPR 243 and Sackville J in A Goninan & Co Ltd v Commissioner of Patents (1997) 38 IPR 213. From these decisions it is clear that the Commissioner must give genuine and proper consideration to all relevant circumstances and that his discretion cannot be reduced to an imperative compliance with particular requirements. Also while the Commissioner, before allowing an extension, must be satisfied that the person seeking the extension has made out a proper case justifying the extension, the absence of a satisfactory explanation will not preclude an extension of time if it is appropriate in the circumstances.

Relevant considerations will include the varied interests of the parties and also the public interest which may be much more significant in considering the extension of term of a petty patent that it would be in normal opposition proceedings. For this reason the Commissioner normally expects matters under Sections 28 and 69 to be resolved much more expeditiously and the time limits set by the Commissioner tend to reflect this.

The delegate, in deciding the previous extension of time request (the decision of 15 October 1998), applied the above principles and concluded that an extension of time was unjustified:

• The problems experienced in relation to the nature of the evidence were not at all clear and three declarations were said in early June to be in an "advanced state of preparation" but insufficient explanation had been given for why they have not yet been served.  Indeed, each subsequent request had foreshadowed the imminent filing of the evidence and little progress appeared to have been made.

• The delay in providing evidence had also been linked to some degree to the progress of invalidity proceedings before the Federal Court.  While the need to simultaneously prepare evidence for court proceedings may be a factor that the Commissioner ought take into account, those proceedings are independent and do not automatically justify delays in separate proceedings before the Commissioner.  A discussion of the competing interests that apply in the case of co-pending proceedings can be found in Abb Engineering Construction Pty Ltd v A. Goninan & Co Limited (Unreported Patent Office decision in relation to patent application 657639, 21/08/98).

• The public interest is certainly in favour of the parties having reasonable opportunity to prepare their case but it is also to a large degree in seeing matters before the Commissioner pursued diligently and for the early resolution of the status of the petty patents.
  
  

• Given the time that has already elapsed and the long delay that may well occur before the Federal Court action is resolved, the delegate believed the public interest is weighed heavily against an extension of time.

The delegate observed that the patentee had had more than fourteen months to respond to the Informant's evidence and given that nothing in response had been filed or appeared likely to be filed in the foreseeable future, the Commissioner's indulgence could not be extended any further.  Although the delegate found the extension to be unjustified, he provided a 14 day extension to allow the patentee to file evidence to hand to avoid being shut out completely.

There are two circumstances surrounding the current request which differ from those in the previous extension:

1. There was a change of solicitors after the previous request and the new solicitors have only recently had access to the evidence;
   
   

2. There now appears to be a realistic time table for when evidence can be finalised (but this is not until February 1999).

I do not believe that either circumstance warrants the substantive hearing being deferred any longer:

• The delegate in his 15 October 1998 decision clearly regarded the 14 day deadline as a final opportunity to avoid the patentee being shut out entirely.  While I have some sympathy for Mr Wilson having the problem of such late access to the evidence, I agree with the informant that this problem was caused by Dynamic's decision to continue with their previous legal representative for the period that they did with the consequent failure to diligently prepare their case before this point.

• The public interest has to be balanced between dealing with matters expeditiously and allowing sufficient time for the parties to prepare their evidence.  In this case, there have been significant delays in determining the matter because evidence in response has not been finalised.  On balance, therefore, the public interest would be served at this point by bringing the matter to determination quickly.
  
  

• The patentee has an interest in being able to prepare their case adequately.  However, the patentee has been given considerable extra time to prepare their case which is still incomplete.  They have not adequately explained the lengthy delays in preparing the evidence.  The patentee's interests therefore have to be given less weight that the competing interests of the public and the informant.
  
  

• While the patentee seems to have provided a "realistic" timetable, I have some concerns that this time table will be met. Given past assurances by the patentee that evidence was near to completion in June 1998 and given the lack of explanation of the delays, it is not clear that the problems in completing the evidence have been resolved.
  
  

• If the extension were to be granted until February, 1999, this would have allowed the patentee 17 months to prepare evidence that the Commissioner normally expects to see completed in 3 months.  (I note that the informant was provided 2 months to complete their evidence in support.)  The Commissioner has an obligation to handle matters before him efficiently and also expects high professional standards from those who deal with our office.  Dynamic has failed to meet their responsibility to meet reasonable deadlines and have not explained the lengthy delays in preparing the evidence.

• The informant permitted the patentee a significant amount of additional time before objecting and now seeks determination of the matter.  This is not unreasonable under the principle that "someone who brings a legitimate, genuinely arguable claim to the Court is entitled to have that claim heard as soon as the Court can conveniently arrange it, consistently with the demands of other litigants" per F.A. Faulding & Company Ltd v Bristol-Myers Squibb Co., 40 IPR 511.

In my view, Dynamic has had more than an ample opportunity to prepare its evidence and has failed to do so.  The public interest in not shutting out the patentee is strongly outweighed by other public interests in having the matter finally determined and the informant's right in having their case heard.  It is therefore appropriate that the substantive hearing proceed in this matter as soon as practicable.

I refuse the request for the extension of time and I direct that the substantive hearing be set for 21 December 1998.  Since Mr Wilson indicated at the hearing that there is no evidence ready at the present time and no likelihood of any evidence being ready to be served before February 1999 at the earliest, I do not consider that it is appropriate to grant a short extension of time to allow the serving of any evidence at hand.

CONCLUSION

The request for extension of time is refused and the substantive hearing is set for 21 December 1998. 

COSTS

I award costs against Dynamic Data Systems Pty Ltd.

Ray Hallett
Acting Deputy Commissioner of Patents

Patent attorneys for the patentee:  Griffith Hack, Melbourne

Solicitors for the informant:  Clayton Utz, Sydney