Firebelt Pty Ltd v Brambles Aust

[2001] HCATrans 219

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B93 of 2000

B e t w e e n -

FIREBELT PTY LTD

Applicant

and

BRAMBLES AUSTRALIA LIMITED trading as CLEANAWAY

First Respondent

COOLOOLA SHIRE COUNCIL

Second Respondent

THE STATE OF QUEENSLAND

Third Respondent

Application for special leave to appeal

GLEESON CJ
GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON WEDNESDAY, 27 JUNE 2001, AT 10.24 AM

Copyright in the High Court of Australia

____________________

MR J.J.J. GARNSEY, QC:   May it please the Court, I appear with my learned friend MR C.J. CARRIGAN, for the applicant. (instructed by Xavier Kelly & Co)

MR D.F. JACKSON, QC:   If the Court pleases, I appear with my learned friends, MR A.B. CROWE, SC and MR R.I.M. LILLEY, for the first respondent. (instructed by Deacons)

GLEESON CJ:   There is a certificate from the Deputy Registrar saying that he holds a letter from the solicitors for the second respondent and the solicitors for the third respondent stating that they do not wish to appear in this application and will submit to any order of the Court save as to costs.  Yes, Mr Garnsey.

MR GARNSEY:   Your Honours, the judgment of the Full Federal Court, which is the subject of this application, raises substantial questions of legal principle of general importance concerning, we submit, four matters:  first, the proper test for obviousness or lack of inventive step in the case of a combination patent, a very common, if not the most common, type of patent;  secondly, the construction and application of one of the most important definitions of the Patents Act 1990, that is of prior art base; thirdly, the proper and continued application, in effect, of long-standing decisions of this Court, especially the 3M Case, concerning obviousness and lack of inventive step; and, fourthly, whether the application of these decisions is affected by section 7 of the Patents Act and the definition of “prior art base”.  These questions are raised in relation to a relatively simple engineering patent with easily understandable technology.

GUMMOW J:   Now, what would we do if you obtained a grant and we agreed with you on these legal questions, what would then happen as to the conduct of the disposition of the litigation?

MR GARNSEY:   Your Honour, two things could happen, if your Honour pleases:  the appeal could be set aside and ‑ ‑ ‑

GUMMOW J:   And then what?

MR GARNSEY:   There would be very limited finding to enable the Court to dispose of the matter completely.  Alternatively, the matter could be remitted if the Court were of the opinion ‑ ‑ ‑

GUMMOW J:   To where?

MR GARNSEY:   Your Honour, it would presumably have to be to the trial judge, if your Honour pleases, or, if a new trial were to be granted, to the Federal Court at first instance.  But, your Honour, we would see that as an unlikely result, if your Honour pleases.

GUMMOW J:   Well it may be said against you that if the correct legal principles were applied, nevertheless it would clearly be proper on the evidence to find adversely to you and that involves evaluation of the expert evidence obviously; a different form of evaluation.

MR GARNSEY:   Your Honour, it involves an evaluation of expert evidence within a comparatively short compass, the reason being that originally there were eight grounds of objection raised before the trial judge.  We were successful on six of those before the trial judge.

GUMMOW J:   I am thinking about obviousness.

MR GARNSEY:   Yes, well that is why there are very limited parts of the evidence to be considered, if your Honour pleases, in any such ‑ ‑ ‑

GUMMOW J:   We do not have them at the moment.

MR GARNSEY:   No, your Honour.  Your Honour, the Full Court and, indeed, the trial judge, referred to decisions of this Court the, in particular 3M and Dunlop Perdriau Rubber, in relation to the test for obviousness and as to a combination patent and the selection of features for a combination patent and as to the need for evidence, but then it proceeded to go off in what, we respectfully submit, was a completely different direction.  Their Honours did not, in the Full Court, nor did the trial judge, consider the combinations as combinations for the purpose of assessing inventive step.  That, if your Honour pleases, we submit is the central error which raises the questions of general importance.  It is a matter which ‑ ‑ ‑

GUMMOW J:   What you said were the questions of general importance, are they grounds 1 to 4 on page 104 or are they something more?

MR GARNSEY:   Page 104 is the notice of appeal, if your Honour pleases.

GUMMOW J:   Yes.  I am looking at the grounds.

MR GARNSEY:   Yes, your Honour.

GUMMOW J:   Five is just there for colour, is it, 2.5?

MR GARNSEY:  Your Honour, we deal with that a little differently in the statement of argument, if your Honour pleases, in perhaps a slightly different hue, and that is at page 116, 25(2).

GUMMOW J:   It is a sort of a nature justice point, is it, 2.5?

MR GARNSEY:   Well, your Honour, the simple fact of the matter is that I find in the written submissions of the appellants nor in the oral submission was there anything said which mentioned novelty or anticipation as part of the applicant’s case or as part of the applicant contended was the correct test or effected the correct test in relation to obviousness.  In relation to the appellant’s supplementary material, tab 19 sets out the submissions and if one looks there in paragraphs 2.2 and 2.3 and 5.11 and 5.12, one does not see, with the greatest respect, one word about novelty or anticipation.

GUMMOW J:   I am not following this.

MR GARNSEY:    I am sorry ‑ ‑ ‑

GUMMOW J:   Are you saying that in the Full Court there was no ground of appeal dealing with inventive step and obviousness?

MR GARNSEY:   Your Honour, what happened in the Full Court was this:  the applicants were unsuccessful as to obviousness and in utility; we were successful before the trial judge as to a number of things, including novelty. My learned friends filed a notice of contention; then, at the end of argument on obviousness and utility, they said that it would not be necessary for the court to pursue the matters the subject of the notice of contention if the Full Court found for the respondents to the appeal in relation to either obviousness or ‑ ‑ ‑

GLEESON CJ:   Well, that indicates a need for remitter, does it not?  You are not suggesting that we should decide the issues in the notice of contention that were left unresolved by the Full Court?

MR GARNSEY:   No, your Honour, but we would submit they should not be considered at all, that concession having been made on appeal.

Your Honours, the Full Court in the judgment at page 86 of the application book referred to the applicant’s case as falling into a type of error of confusing novelty with obviousness, and that is what I thought your Honour Justice Gummow’s question raised.  I was saying that in the written submissions before the Full Court there was not anything said which could give that impression.

GUMMOW J:   You were muddled.

MR GARNSEY:   I was not muddled, if your Honour pleases.  One can read what is said there.

GUMMOW J:   It is suggested here you were.

MR GARNSEY:   Yes, and it is apparent from the transcript of argument, we say in a most respectful manner, that it was the Full Court that was muddled.  At pages 39 to 41 of the transcript – I do not wish to take your Honours to very much of this at all - there is a passage set out, part of which is extracted in the judgment of the Full Court at pages 86 to 87, the court having been referred to the authorities, there was reference made to prior art – sorry, I have given your Honours the wrong page references, I apologise, your Honours.  It is at pages 60 to 61.  At line 10 there is a passage, responding to Justice Spender, halfway through which at line 14, there is the question which is set out ‑ ‑ ‑

GUMMOW J:   I am not following all this.  What are you referring to?

MR GARNSEY:   I am sorry; the transcript of the argument before the Full Court on 23 August ‑ ‑ ‑

GUMMOW J:   We do not have page 60.

GLEESON CJ:   Page 60 comes in between pages 58 and 59, as you would expect.

MR GARNSEY:   I am sorry, your Honour.  Well, could I ask your Honour to search part through 61.  Your Honours see at line 9 there is a passage beginning by responding to Justice Spender.  At line 14 there is a passage, “it is impermissible” and that is extracted in the judgment of the Full Court at line 35, as to three lines and then there is a discussion going across to page 62, where, at line 20, Justice Drummond then makes a statement or the allegation that is set out at page 86 of the appeal book in the judgment and across to page 87 there is an extract of a further two lines a couple of pages on, or at least page 64.  Your Honours, the discussion concluded at page 64, lines 13 to 30, without a mention of novelty or anticipation or making quite clear what our case was, which is the case set out in the statement of argument at page 112 paragraph (e) at the bottom, when we submit, and this is what we say is the correct approach on the authorities:

The correct approach, it is submitted, is to consider objectively the recognised real problems of any whole prior art combination without any prior knowledge of the claimed invention and then to consider a range of possible options why the notional addressee of the patent would select or reject certain features ‑ ‑ ‑

GUMMOW J:   Now, how many expert witnesses were there?  The inventor himself seems to have been called as an expert.

MR GARNSEY:   Yes, really only the inventor.  Certainly for anything the Court might have to consider, only the inventor.

GUMMOW J:   And on the other side?

MR GARNSEY:   On the other side there are four witnesses, but they did not give technical evidence, if I could put it that way, your Honour.  What they gave was evidence of the content of the disclosure of the part of the prior art that was relied upon.

GUMMOW J:   Your opponents have the onus on, obviously?

MR GARNSEY:   Yes they did and that is ‑ ‑ ‑

GUMMOW J:    It was their cross claim?

MR GARNSEY:   Yes, and that is something that the trial judge, with respect, quite misstated at page 48, line 38, in his Honour’s judgment.

Your Honour, the matters which crystallise the questions of general importance are quite simple.  At the beginning of the Full Court judgment there is the consistory clause of the invention, which is the same as claim 1, set out, and one can see from the bottom of page 83 that it is a combination patent, and the features are listed on page 84 and they are all ‑ ‑ ‑

GUMMOW J:   It was a petty patent, was it not?

MR GARNSEY:   It is a petty patent, yes, your Honour.

GUMMOW J:   So there had been no opportunity for opposition?

MR GARNSEY:   No, but the features of the combination patent were all treated, both at trial and on appeal, as being essential features as the first ‑ ‑ ‑

GUMMOW J:   There is only one claim?

MR GARNSEY:   Yes, for practical purposes, yes.  There were three, in fact, your Honour, but the other two were very short and all the features were dealt with as essential features, and that is clear from the top of page 84.

GUMMOW J:   The case took 10 days, did it; 14 to 24 November?

MR GARNSEY:   At trial.  It only took two days on appeal and at trial, although there were a large number of prior art specifications upon which his Honour wished to commence the trial without reading any of them, it was necessary for me to cross-examine one of the first witnesses at some length.

GLEESON CJ:   Where do we find in the reasoning of the Full Court the error upon which you principally rely?

MR GARNSEY:   Your Honour, the consideration after setting out the formal matters begins at page 86 - and I am going to answer your Honour the Chief Justice, but I cannot answer it by going to one sentence; it is a process, if your Honour pleases.  After confusing novelty with obviousness and, in my respectful submission, that was the course - - -

GUMMOW J:   Where do you say that happened or that manifested?

MR GARNSEY:   That happened at page 86 where it was said the applicant’s case was to fall into a type of error of confusing novelty with obviousness and to suggest a “reverse infringement”.  We did not do anything of the sort.  The passages to which I have taken your Honour in the submissions and the transcript, so that we put the proposition in accordance with the statement of principle, especially in the 3M Case of Sir Keith Aickin that one has to prove the features as part of common general knowledge and then the inventiveness of the selection.

GUMMOW J:   Now, that is the first full step you say.

MR GARNSEY:   Yes.  And then the court, having failed to deal with the inventiveness of the combination of the invention, the Firebelt combination as opposed to the TWT Hickey, despite, at the top of page 87, saying, that is what it should do.  What it did essentially was approve the same process as the trial judge.  Now, at the top of page 88 there is a deceptively, we would respectfully submit, simple sentence, at lines 2 to 10, where the court says what his Honour did was just make a finding of the evidence.  In fact what his Honour did was - and the Full Court then continued, to adopt his Honour’s reasoning, referring to the same evidence over at page 90 at 37(e), saying it was all right to categorise the inventive step as “simply use of a lid opening device”.  What his Honour did, as emerges from page 49 of his Honour’s judgment in an important paragraph at 20 to 40, which the Full Court do not cite, they cite the one above it.

GUMMOW J:   What page?

MR GARNSEY:   Page 49, lines 20 to 40.  Says it is all right just to take a list of features and to compare them without ‑ ‑ ‑

GUMMOW J:   Who is Mr Richards?

MR GARNSEY:   He is the inventor.  It is all right to take a list of features without considering their interrelationship and then remove one from a bit of prior art, pose a question which the prior art does not raise and in which the evidence does not raise, that is, put a lid opening device somewhere, and then come to a conclusion.  When one looks at the sentence at line 32:

However, in this case, the removal of the butterfly plate –

that is in the opposing prior art –

did not result in any different outcome in the interaction of the other integers.  They continue to do precisely what they did before, both in total and in relation to one another.

The fact is, in the prior art, there was no lid opening device; the prior art was for an invention which operated once a lid had been opened, just did not deal with that, and then it put a clamp and a butterfly plate on top of a bin to make sure that the contents did not come out, and there was no issue in the case and no evidence directed to whether the removal of the butterfly place was a matter of inventive ingenuity or non-inventive ingenuity or a matter of routine and, indeed, the only evidence of the prior art disclosure, which is set out in both the trial judge’s judgment and the Full Court’s judgment, elicited from the witness, Mr Love, is of a concept which makes it quite clear, has the butterfly plate and is not concerned at all with the lid removal.  What we respectfully submit the Full Court has done is to embark upon ex post facto analysis and discovery which, we submit, is not permitted on the authorities.

The other point in respect of which we seek special leave in relation to section 7 is set out quite clearly in our statement of case, if your Honour pleases.

GLEESON CJ:   Yes, Mr Jackson.

MR JACKSON:   Your Honours, the points which we would seek to make essentially are these:  first, that both courts below applied the correct test in terms of the Act and, secondly, that the issue was ultimately one of fact on which there are concurrent findings in the courts below.  May I seek to develop those things.

Your Honours, the starting point is the Patents Act itself. The first relevant provision of which is section 18(1)(b)(i) and your Honours will see that a patentable invention is an invention that, and your Honours will see the terms of paragraph (b)(i) “involves an inventive step”. Now, your Honours, the term “involves an inventive step” is not left in the air, but is defined by section 7(2). The words of section 7(2) deal with two aspects: one, the burden of proof; the other being the identification of the matter requiring to be so proved. As to the burden of proof, the burden lay on the person seeking revocation, our side.

Your Honours will see that section 7(2) then set out the content of what had to be proved to provide an entitlement to revocation and, fundamentally, a very simple test in terms of the words of the statute. Your Honours, the central concept in section 7(2) is the invention; your Honours will see that in the third line of section 7(2) and that was to be seen and described in the present case in the claims and the integers of the claim, which your Honours will see at pages 51 and 52. Your Honours, may I go to page 52 immediately; it is an annexure to the primary judge’s reasons.

Your Honours, it is apparent, if one goes to the essential integers, that very broad terms are being used and one sees, in particular, if one goes to paragraphs (f), (g) and (h), that they are being expressed in the most general terms and those were the core parts, the parts said to give it some element of inventiveness.

Your Honours, as appears from the primary judge’s reasons, it was an understood an underlying factor, that the bins being lifted had to have lids.  Your Honours will see that in two places:  page 2, line 30 through to 35, then one sees the same thing at page 40, lines 25 to 36, and his Honour particularly said:

It is difficult to see that there could have been any alternative to the use of a lid opening device.

Essentially, it was so obvious, there had to be one.

Now, your Honours, any lids would have to be opened to remove the rubbish from them.  The judge at first instance identified the correct test.  Your Honours will see that at page 42 in the passage commencing at about line 27, going through to line 32; he refers to “the combination” and your Honours will see that follows a setting out by the primary judge on the preceding page of the relevant quotation from Justice Aickin in 3M at the bottom of 41 and the top of 42.

GUMMOW J:   Where is the actual finding of “obviousness” by the trial judge?  Is it at page 46?

MR JACKSON:   I am sorry to put it this way, Your Honour.  It is in a couple of places, I think.  At page 46, your Honours will see line 40.

GUMMOW J:   Yes.

MR JACKSON:   Now, what I was going to say, your Honours, was this:  one sees the evidence to which the primary judge referring being evidence “that the combination was obvious”.  Your Honours will see that in his reference to Mr Ahrens’ evidence at page 44, lines 24 to 26, where he said:

At pages 252-3 Mr Ahrens said that the combination was obvious in the light of the Hickey proposal.  He regards himself as an inventor.

He referred again to that at page 46, lines 11 and 12:

Mr Ahrens considered that loading mechanisms incorporating lid opening devices were well known prior to February 1992, as were the other elements of the claim.

Your Honours, that is direct evidence on the point.

GUMMOW J:   Well, you see:

in the context of this case, I take this to mean that had he been faced with the need –

et cetera, et cetera.

MR JACKSON:   Yes, but, your Honour, could I say ‑ ‑ ‑

GUMMOW J:   That is not the normal way these things are decided.

MR JACKSON:    ‑ ‑ ‑that what one was talking about in this case, your Honours will see from page 52, going back to the terms, that (f), (g) and (h) were not described with any degree of specificity.  All that was said, essentially, was that ‑ ‑ ‑

GUMMOW J:   Well on this hypothesis it is a good claim.

MR JACKSON:   Your Honour, I am not saying that claim, if one looked at is, is demurrable, if I can put it that way.  All I am saying is that if one looked at the claim one sees that the elements of (f), (g) and (h) were – (f) is the most obvious kind:

the loading mechanism having a lid opening device –

and the same with (g) and (h), and what the judge was saying was that if one looked at the claim, the claim was one which did not identify those elements with any degree with specificity; they could have covered any type of it, really.

GUMMOW J:   Yes, well that is another ground of objection.  If it is made good, it is made good.

MR JACKSON:   But, your Honour, I am sorry, what he was saying was that it was obvious there had to be, or the provision of those things, was obvious prior to the claim.  Your Honours can see that at page 49.  Your Honours, perhaps I should just say one further thing before going to that, and that is Mr O’Dwyer’s evidence appears at the bottom of page 44, the last paragraph, and then your Honours will see on page 45, at line 5, he said that he had given evidence that:

each of the integers of the claim was known to him and had been used or demonstrated in vehicles in the waste industry.

GUMMOW J:   That is often so with combination patents.

MR JACKSON:   Yes, your Honour, with respect, it may well be;  I mean, that is the essence of a combination patent, but it is in the end a question of forming a view on the ultimate question and, in our submission, that is fundamentally a question of fact involving judgment and one, as has been said in a number of cases, akin in a sense to a question of fact to be decided by a jury and, your Honour, in those circumstances, when one comes to the question that was dealt with at page 49, your Honours will see about point 3 of line 3, he said:

the applicant did not identify a particular lid opening device.

Although, line 1:

the need to open the lid was obvious . . . The claim is wide enough to encompass all such devices.

Then a couple of lines further down:

the inventive step which is claimed is simply use of a lid opening device of any kind –

And your Honours will see two lines further down that even the inventor had recognised the obviousness of that.  Your Honours, the point we would seek to make about it is, in our submission, that the primary judge had evidence before him which supported the conclusion he was entitled to arrive at it and he did, and if one goes to the Full Court at page 87, line 11, their Honours say in relation to the test:

It is trite, of course, that where one has an invention that is a combination of well-known integers, the inventive step in the invention lies in the combination.

Their Honours said that, again having referred to the 3M Case on page 85 and set out the passage from it.  Our submission is, if one goes to the top of page 88, and what follows thereafter, that what the court did was to review the evidence before the primary judge and to accept the view that there was evidence upon which he was perfectly entitled to arrive at those conclusions.  Your Honour, our submission is, this is quintessentially a fact case and nothing more.

GLEESON CJ:   Thank you, Mr Jackson.  Yes, Mr Garnsay.

MR GARNSEY:    If your Honour pleases.  In our respectful submission, it goes beyond the fact case, if your Honour pleases, because of the way both the Full Court and the trial judge dealt with material before them, contrary to the enunciated statements of principle in the long-standing decisions of this Court.  Your Honour, this is exemplified on the trial judge’s treatment in the paragraph I took your Honours to before on page 49, lines 20 to 40.

GUMMOW J:   You seem to be saying that true enough they stated the principles extracted from the cases, but the way in which they then set about applying them suggests a failure in understanding of what the principles really meant?

MR GARNSEY:   Yes, your Honour, but with an added, or what might be called purely, legal right, in this sense, that the passage cited from Sir Keith Aickin, frequently in the judgments about excessively

inventiveness of the combination by proving the features as part of common general knowledge and then proving the selection or treating the question whether the selection is inventive or not, of the features, involves a consideration of the whole invention of the claim.  When their Honours, both in the Full Court and the trial judge, cited those passages, they did not then go on to consider the inventiveness of the combination as a whole invention - this is our point – but did a sort of addition and subtraction.  This is particular highlighted in the two paragraphs on page 49 of the trial judge, which is reflected then in the analysis of the Full Court, to which I will go, but can I just take your Honours very briefly to two sentences, talking about the prior art disclosure at line 32:

However, in this case, the removal of the butterfly plate did not result in any different outcome ‑ ‑ ‑

GUMMOW J:   Well you took us to that before.

MR GARNSEY:   Yes, but I did not take your Honour on to the next sentence, because the orange lights were on, if your Honour pleases:

They continue to do precisely what they did before, both in total and in relation to one another.

Now what that is saying is that in the subject invention, because Mr Richards took out the butterfly plate and had a lid opening device operating after engagement, et cetera, the features in TWT Hickey, which did not include the lid opening device, which are found in the subject invention, continued to do precisely what they did before – that is in TWT Hickey – both in total and in relation to one another.  There is not one jot of evidence about that, with the greatest respect, about that co-operation, that notional co-operation, that somehow you are entitled to take a bit here and a bit there and formulate and postulate an imaginary co-operation.  We respectfully submit that this case crystallises real errors in approach which need the attention of this Court in the light of its previous decisions.  May it please the Court.

GLEESON CJ:   Thank you, Mr Garnsey.

In this matter there will be a grant of special leave to appeal, limited to the grounds identified in paragraphs 2.1 to 2.4 inclusive on page 104 of the application book.

AT 11.01 AM THE MATTER WAS CONCLUDED