Equivalent Cooling Tower Co Pty Ltd v Pritchard Cooling Tower Services Pty Ltd
[1998] FCA 1648
•16 DECEMBER 1998
FEDERAL COURT OF AUSTRALIA
PATENT – alleged infringement – interlocutory injunction – whether there is a serious question to be tried – relevance of the petty patent system to the balance of convenience
Peter Pan Electrics Proprietary Limited v Newton Grace Proprietary Limited (1985) AIPC 90 232 Appl
EQUIVALENT COOLING TOWER COMPANY PTY LTD V PRITCHARD COOLING TOWER SERVICES PTY LTD AND PRITCHARD PACIFIC PTY LTD AND GREGORY WILLIAM WILCOX
QG 172/98
KIEFEL J
BRISBANE
16 DECEMBER 1998
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
QG 172 of 1998
BETWEEN:
EQUIVALENT COOLING TOWER COMPANY PTY LTD
APPLICANTAND:
PRITCHARD COOLING TOWER SERVICES PTY LTD
FIRST RESPONDENTPRITCHARD PACIFIC PTY LTD
SECOND RESPONDENTGREGORY WILLIAM WILCOX
THIRD RESPONDENTJUDGE:
KIEFEL J
DATE OF ORDER:
16 DECEMBER 1998
WHERE MADE:
BRISBANE
THE COURT ORDERS THAT:
The Order of 16 December 1998 in terms of the original draft:
Upon the Respondents undertaking pending the trial of this action to:
Keep a full and accurate record of all of:
a. The alleged infrining fill grid panels, identified in the Affidavit of Paul Wayne Evans dated 7 December 1998 (the "fill grid"), supplied to CS Energy under contract SB305, and
b. The financial accounts and transactions of the Respondents relating to the said Contract SB305.
The Respondents will not, nor cause any other entities to tender for theuse of, or otherwise contract to use the fill grid without first giving the Applicant as much written notice as is reasonably practical of any intention by anyy of the Respondents to tender for or use the said fill grid The Respondents shall specify in such notice full details of the proposed bid or contract.
The Court orders that:
The application for interlocutory injunctions be dismissed.
The applicant pay the Respondents' costs of and incidental to the application to be taxed.
The Court further orders that:
the applicant supply the Respondent with a list of the corporations or entities to whom letters advising of the infringment had been sent without the applicant disclosing any contact within that corporation or other entity.
6/ The applicant provide the Respondent within 48 hours of sending any further such letter a copy of the letter.
The costs incidental to the proceeding be reserved.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
QG 172 of 1998
BETWEEN:
EQUIVALENT COOLING TOWER COMPANY PTY LTD
APPLICANTAND:
PRITCHARD COOLING TOWER SERVICES PTY LTD
FIRST RESPONDENTPRITCHARD PACIFIC PTY LTD
SECOND RESPONDENTGREGORY WILLIAM WILCOX
THIRD RESPONDENT
JUDGE:
KIEFEL J
DATE:
16 DECEMBER 1998
PLACE:
BRISBANE
REASONS FOR JUDGMENT
EX TEMPORE
The background to this application for an interlocutory injunction is a business relationship between the applicant and the first and second respondents, which is the subject of proceedings in the Supreme Court of Queensland. I take it that it was during the term of that relationship that it is alleged the respondents came to know, in confidence, of the intellectual property in question. It is of some importance that the respondents have, to the applicant’s knowledge, previously employed a fill grid such as that now in question. In May 1998, the applicant threatened proceedings, but did not pursue them. Mr Dutney QC for the applicant says that this is understandable, given the difficulties usually associated with injunctions, where there is no intellectual property right attaching, and here the petty patent did not issue until October 1998.
These proceedings were threatened in November 1998 when it came to the applicant’s attention that the first respondent had successfully tendered for a contract with CS Energy, and they intended using the grid panels again. Nevertheless, it is not suggested that any substantial damage has been occasioned to the applicant to date. It is, I consider, the issue of balance of convenience, and in particular, the question as to whether damages will be an adequate remedy, which looms largest on this application. The first respondent has contractual obligations which it likely undertook in the background of the earlier threatened proceedings not eventuating. It has expended monies in relation to the provision of the goods or panels, and it has time limits it is required to meet. It was contended for the applicant that the other contracting party, CS Energy, might accept alternative panels. That may be possible, but it is not certain on the state of the material.
The applicant does not disclose the damage it will suffer if an injunction is refused. The matter was left on the basis that it is an infringement of a statutory monopoly. That, however, brings into focus the nature and extent of the interest in question, which is a petty and not a standard patent, and one which issued quite recently, although it may derive priority from the parent application.
Lockhart J in Peter Pan Electrics Proprietary Limited v Newton Grace Proprietary Limited (1985) AIPC 90 232 at 36 296, to which Mr Crowe for the respondents has referred me, was of the view that factors associated with petty patents might be taken into account in relation to the balance of convenience, and I respectfully agree. His Honour observed that petty patents are not subject to the same level of examination as standard patents, nor opposition, and, of course, the term is shorter.
I have not, to this point, referred to the cases which the parties have outlined in relation to the patent itself. The applicant has, by reference to the issue of the petty patent, and subject to what I have just said, shown that there is a serious question to be tried concerning infringement. Indeed, it points to the respondents’ apparent acceptance of infringement. The respondents, for their part, have put forward claims which would be pursued as cross-claims for revocation of the patent, or in opposition proceedings as to novelty and lack of inventive step, and assert also that it is not fairly based upon disclosure in the parent patent. At least the cases with respect to obviousness and novelty must, in my view, be regarded as raising serious questions. In the result, the applicant’s case for an injunction is not advanced by reference to the nature and strength of its case in the principal proceedings.
I had considered, given the history of the matter, whether to grant an injunction generally, but excepting this particular contract with respect to it. On the view I have taken of the claims apparent to this point, I do not think that appropriate. The respondents have also offered an undertaking which I consider should go a long way to overcoming further problems, and in terms that they will inform the applicant of any intention to enter into a contract using the grid panels.
Obviously that would need to be done prior to any entry into contract and in sufficient time to permit the matter to be brought forward. The applicant objected that this would merely result in a duplication of these proceedings, but it seems to me that if it later appears that the respondents intend to continue to use the panels in other contracts, and conflict is renewed, the Court may well have to find some way of determining at least the issue of liability.
I propose to refuse the injunction on the respondents’ undertaking to keep records, the terms of which I will further discuss with counsel, and upon their undertaking earlier mentioned. I will give directions as to the future conduct of the proceeding, including mediation between the parties in an endeavour to resolve this matter.
In connection with costs, it seems to me that the application was brought in the face of the usual principle that refusal is likely where damages would be an adequate remedy. In those circumstances, I will order that the applicant pay the respondents’ costs of and incidental to the application for injunction.
I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Kiefel
Associate:
Dated: 16 December 1998
Counsel for the Applicant: Mr P Dutney QC and with Mr E Morzone Solicitor for the Applicant: Hollingworth & Spencer Counsel for the Respondent: Mr A Crowe Solicitor for the Respondent: McCullough Robertson Date of Hearing: 15 December 1998 Date of Judgment: 16 December 1998
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