G S Technology Pty Ltd v GSA Industries (Aust) Pty Ltd
[2001] APO 9
•27 February 2001
OFFICIAL NOTICE
DECISION OF A DEPUTY COMMISSIONER OF PATENTS
Application : No. 32815/95 in the name of G S TECHNOLOGY PTY LTD
Title: Water Meter Assemblies
Action: Request for an extension of time under Section 223 to pay a continuation fee and opposition thereto by GSA INDUSTRIES (AUST) PTY LTD
Decision: Issued .
Abstract
The action not carried out in time in this case was the payment of the sixth year continuation fees for application 32815/95, which were due on 30 August 1997. The reasons given by the applicant for not paying the fee by that date relate to incorrect advice given by Pizzeys as to the due date for payment and protracted proceedings in the Federal Court concerning the related petty patent 645740.
The grant of an extension of time under the provisions of section 223 is discretionary. All issues were considered having regard to the principles outlined in the decision in Kimberly-Clark Ltd v Commissioner of Patents and Another (No3) (supra). In exercising the discretion, it was necessary to balance:
the unlikelihood that it was in the applicant's interest for application 32815/95 to lapse
against
the lack of any causal link between the letter from Pizzeys and the failure to pay the fee;
the apparent absence of any other plausible error or omission; and
the lack of a full and frank disclosure of all relevant facts
Having regard to all the circumstances, it was considered that in this case the balance weighs in favour of refusing the extension.
Thus, the application under section 223 for an extension of time to pay the sixth year continuation fee was refused and as a result, the application remains lapsed under the provisions of section 142(2)(d) for the failure to pay that continuation fee.
PATENTS ACT 1990
DECISION OF A DEPUTY COMMISSIONER OF PATENTS
Re:Patent Application No. 32815/95 in the name of G S Technology Pty Ltd, a request by the applicant for an extension of time under the provisions of section 223 in which to pay a continuation fee and opposition to that request by GSA Industries Pty Ltd.
BACKGROUND
Patent application 32815/95 in the name of G S Technology Pty Ltd (hereafter referred to as GST) was filed on 21 September 1995 as a divisional application of 85236/91, filed on 30 August 1991.
The due date for payment of the (sixth year) continuation fees was thus 30 August 1997. The Patent Office was advised on 6 November 1995 of a change of address for service for the applicant from Pizzey & Company (hereafter referred to as Pizzeys) to Mr Andrew Abaza, Solicitor.
I note that petty patents 645740 and 662284 are also divisional applications of 85236/91. The Commissioner has issued decisions refusing to extend both those petty patents. In the case of 645740 the Federal Court, on appeal, has found the petty patent invalid. Petty patent 662284 is currently on appeal to the Federal Court.
On 10 March 1998, the applicant was advised by the Patent Office that the sixth year continuation fees due on 30 August 1997 had not been paid by that time or within the 6 month "grace period" provided for under regulation 13.3. As a result, the application had lapsed on 30 August 1997 under the provisions of section 142(2)(d).
On 13 March 1998, the applicant applied for an extension of time in which to pay these continuation fees. This was accompanied by a statutory declaration by Andrew Peter Abaza and attached Annex A. The request was advertised for opposition purposes on 30 April 1998 and a notice of opposition by GSA Industries Pty Ltd (hereafter referred to as GSA) was filed on 21 May 1998.
A statement of grounds and particulars in the section 223 opposition was served on the applicant on 19 August 1998 and on 1 September 1998, GST requested dismissal of the opposition. The dismissal hearing was held on 7 October 1998 and a decision against the applicant was issued on 13 October 1998. GST subsequently appealed the decision to the Federal Court but the Court rejected the appeal. That decision was upheld on appeal to the Full Bench of the Federal Court.
Evidence in support of the section 223 request was deferred pending the outcome of the Federal Court appeal. Subsequently, the opponent GSA advised that they did not intend to serve evidence in support. Evidence in answer was served on 15 May 2000 and evidence in reply on 15 August 2000.
The section 223 matter was heard in Canberra on 21 November 2000. GSA was represented by Mr Terrence J Collins of Phillips Ormonde & Fitzpatrick, who appeared by phone. Mr Andrew Peter Abaza, for GST, relied upon written submissions.
THE NOTICES FOR PRODUCTION
A preliminary issue raised at the hearing by GSA was regarding compliance with certain notices for production. On 25 May 1998, GSA requested the Commissioner to issue notices for production of documents under section 210(c) on Pizzeys, GST and Andrew Abaza. These notices were in relation to correspondence between Pizzeys and Mr Abaza, Pizzeys and GST and Mr Abaza and GST in the period 21 September 1995 to 12 March 1998 concerning the payment of continuation fees for application 32815/95 and to diary entries by Mr Abaza and GST establishing the manner in which a letter from Pizzeys dated 4 October 1995 was acted upon. The notices were issued on 9 June 1998 with substitute orders being issued on Pizzeys and GST on 10 July 1998 to make some minor technical corrections.
GSA alleges that none of the parties have made a serious attempt to comply with the notices. I note that neither Mr Abaza nor Pizzeys have produced any documents. Mr Abaza, by letter dated 1 July 1998, objected to the notice as being invalid. He also objected that the documents were not in his possession and that privilege attaches to the documents. Pizzeys informed us that a full copy of the file was delivered to the Federal Court following a subpoena, and that a claim for privilege in respect of all documents (other than those available in our office) was made. GST provided copies of 28 documents, none of which appear to fall within the scope of the notice issued.
According to GSA, none of the parties served with a notice have denied the existence of relevant documents. As a result, they claim that the assumption is that such documents exist and that the failure to produce them contravenes section 181 of the Act. The present hearing was in relation to the section 223 request only and was not a hearing into compliance with the notices for production. Thus, no findings concerning compliance with section 181 have been made. However, I will refer to the notices where relevant in the decision.
WHEN WAS THE CONTINUATION FEE DUE?
Under section 142(2)(d), an application lapses if the applicant does not pay a continuation fee within the prescribed period. This prescribed period is 12 months ending on the anniversary of a date which would be the date of the patent if a patent were granted on the application.
As stated above, the present application was filed on 21 September 1995 claiming divisional status from application 85236/91 (filed on 30 August 1991, with an earliest priority date of 30 August 1990). At the time application 32815/95 was filed, regulation 6.3(f) determined the date of the patent for a divisional application to be "the date of filing of the complete specification in which the invention that is the subject of the application was first disclosed." Thus, as the hearing officer stated in his decision on the request by GST for dismissal of the opposition (issued 13 October 1998), the sixth year continuation fee payment was due on 30 August 1997. Regulation 13.3 allows for a six month "grace period" for payment of a continuation fee, extending the time for payment of this fee to 28 February 1998. This being a Saturday, the "grace period" then expired on Monday 2 March 1998.
In the subsequent appeal to the Federal Court on the dismissal action [Stack v Commissioner of Patents [1999] FCA 148 (24 February 1999)], GST argued that the delegate was wrong in concluding that the continuation fee was due on 30 August 1997. However, Justice Drummond found that if the applicant wished to contend that this was not correct, it bore an evidentiary onus in that regard and it had "made no attempt either before the delegate or in this Court to discharge that onus."
The issue of the date was raised again by Mr Stack in his declaration served as evidence in answer and by Mr Abaza in his written submissions. However, their submissions seem mainly to relate to the fact that the examiner, in his first report dated 18 October 1996, objected that the invention was not novel. It seems that the applicant has confused the issue of novelty with the first disclosure of their invention.
Furthermore, the application for extension of time did not challenge the due date but only gave reasons why the payment was not made by that date. If the reason the payment was not made on time was due to the applicant believing that the fees were due on a different date then surely those facts should have been given at the time the section 223 request was made. If the applicant believed that the fees were due on a later date by virtue of the first disclosure of the invention, then the section 223 extension would not have been needed. However, GST chose to apply for the extension. Application 32815/95 was filed as a divisional application and GST has not sought to change its status by amending the patent request. The invention, the subject of application 32815/95, appears to be disclosed in the parent document and I can only conclude that it is properly a divisional application.
Thus, I have no basis on which to conclude that the calculated continuation fee date was not correct. As a result, the sixth year continuation fee for application 32815/95 was due to be paid by 30 August 1997. This fee was not paid by then or within six months from that time and consequently, the application lapsed on 30 August 1997. As a result, a section 223 extension is required in order to restore the application.
APPLICATION FOR EXTENSION
The application for extension of time under section 223 was dated 13 March 1998 and was accompanied by a statutory declaration by Andrew Peter Abaza with Annex A. An amended application requested an extension of time from 30 August 1997 to 13 March 1998 in which to pay a continuation fee. The reasons given for requiring the extension of time as given in Mr Abaza's declaration are as follows:
"
I act as general Counsel to G. S. TECHNOLOGY PTY LTD in respect of its applications for patents, including Patent Application No. 32815/95, in conjunction with Messrs Pizzey & Company, Patent Attorneys of Brisbane.
Patent Application No. 32815/95 was filed on 21 September 1995 and in accordance with written advice received from Pizzey & Co 4 October 1995 I was advised that annual renewals were payable on the third anniversary of the filing date. Annexed hereto and marked with the letter "A" is a true copy of the said letter.
My client company and I acted in accordance with the said advice.
On 12 March 1998 I received from the Patent Office a letter advising that continuation fees were payable by 2 March 1998. I immediately lodged $180.00 being the Schedule 7 item 8(a) fee for the third anniversary in the sum of $115.00 plus extension fee one month $65 with the Patent Office in Brisbane.
The advice from the Patent Office aforesaid was received following a letter from my office dated 28 February 1998 which said letter was in part response to an examiner's request dated 18 October 1996. It was not possible for my client company or myself to respond to the requisitions raised on that examination at any earlier time by reason of pending proceedings in the Federal Court concerning AU 645740. Extensive evidence has been given during the course of that proceeding which cannot be the subject of debate while considered by the Court. Those proceedings have been adjourned over to 1, 2 and 3 June 1998 and the evidence concerns novelty, obviousness and other matters also in issue in respect of the instant application.
In my belief were it not for the protracted proceedings concerning Patent 645740 the error or omission of the third anniversary continuation fee would not have been misinterpreted and would have been attended to by 2 March 1998.
On 13 March 1998 I caused an additional payment of $745 to be made to the Patent Office in Brisbane making a total of $925.00."
The annexed copy of the letter from Pizzey & Company to the applicant GS Technology Pty Ltd dated 4 October 1995 is directed to the attention of Mr Andrew Abaza and the text is as follows:
"We refer to our recent letter reporting the filing of the application for patent in Australia according to the below-mentioned details and advise that the application has now been allocated the filing number 32815/95.
Please note that this application will lapse five years from the filing date unless a request for examination is lodged before the expiry of this period. In general the Commissioner will issue a direction to request examination at a date within this period determined by the backlog of the Patent Office,
Annual renewals are payable in respect of Australian Patents and applications, from the third anniversary of the filing date.
We thank you for your instructions to date in respect of the filing of this application. We will keep you advised of the progress of the application."
THE STATEMENT OF GROUNDS AND PARTICULARS
Ground 1 The applicant, G. S. Technology Ltd., (GST), has not made a full and frank disclosure of all the surrounding circumstances which lead to the alleged error or omission, including a disclosure of the chain of causation.
Ground 2 GST and/or its agent Andrew Peter Abaza (APA), failed to take reasonable steps to ensure that maintenance fee requirements concerning patent application 32815/95 were met in a timely fashion, and the reason for that failure has not been explained.
Ground 3 GST and/or its agent APA failed to access or make use of available information which correctly indicated the maintenance fee requirements for patent application 32815/95, and the reason for that failure has not been explained.
Ground 4 GST and/or its agent APA was in possession of correct information concerning the maintenance fee requirements for patent application 32815/95 but failed to act on or make use of that information, and the reason for that failure has not been explained.
Ground 5 GST and/or its agent APA was aware of a source of information concerning maintenance fee requirements for patent application 32815/95, but deliberately chose not to access that source of information.
Ground 6 GST and/or its agent APA made a deliberate decision to give priority attention to matters other than the matter of ensuring timely payment of the first continuation fee in respect of patent application 32815/95.
The particulars are quite lengthy so have not been reproduced here.
EVIDENCE IN THE OPPOSITION
No evidence in support of the opposition to the request for extension of time was served.
Evidence in answer comprises a statutory declaration by George Stack. Mr Stack is given on the patent request as one of the inventors and also states in his declaration that he is Director of the applicant company.
Evidence in reply comprises a declaration by Ian Stanley Pascarl with exhibits ISP1 to ISP5 and a declaration by Terrence John Collins with exhibits TJC1 to TJC3. Mr Pascarl says in his declaration that he is a partner in the firm Minter Ellison and had the care, conduct and control of Federal Court proceedings QG28 of 1994 and QG29 of 1996 on behalf of Davies Shephard Pty Ltd, GSA Industries (Aust) Pty Ltd and Davies Shephard (Queensland) Pty Ltd, respondents in these Court proceedings. Mr Collins is the patent attorney for the opponent.
RELEVANT LAW
Section 223
……..
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.
The time allowed for doing a relevant act may be extended, whether before or after that time has expired.
Where an application is made for an extension of time for more than 3 months, the Commissioner must advertise the application in the Official Journal.
A person may, as prescribed, oppose the granting of the application.
Where:
(c)a patent application lapses, or a patent ceases, because of a failure to do one or more relevant acts within the time allowed; and
(d)the time for doing that act or those acts is extended;
the application or patent must be treated as having been restored.
……………..
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.
Regulation 22.11
22.11 (1) For the purposes of subsection 223(2) of the Act (“extensions of time”), an application for an extension of time must be in the approved form and have with it a declaration setting out the grounds on which the application is made.
Notice of the grant of an extension of time must be published in the Official Journal.
For the purposes of the definition of “relevant act” in subsection 223(11) of the Act, each of the following actions is prescribed:
(e)an action or step prescribed in Chapter 5 (“opposition”), not being an action or step taken under regulation 5.3 (“filing of opposition”) or paragraph 5.4(1)(a) (“filing statement”);
(f)paying a fee in the 6 month period stated in subregulation 13.3(1A) or subregulation 13.6(2).
(g)filing, during the term of a standard patent as required by subsection 71(2) of the Act, an application under subsection 70(1) of the Act for an extension of the term of the patent.
Section 223(2) of the Patents Act as set out above, is a general remedial provision and, in this case, the relevant act not done within a certain time is the payment of the continuation fee. Section 223(2) is applicable to extend the time for paying a continuation fee where the failure to pay on time is caused by either an error or omission by the person concerned or their agent or attorney, or because of circumstances beyond the control of the person concerned. This is a discretionary provision and in deciding if to grant the extension, I need to have regard to all the relevant facts and issues. I note that section 223(2) is not applicable to extend the time where the error or omission occurred in the 6 month period prescribed in regulation 13.3(1A) (formerly regulation 13.3(3)).
I find the decision of Justice Jenkinson in Kimberly-Clark Ltd v Commissioner of Patents and Another (No3) 13 IPR 569-584 helpful when considering the factors which need to be taken into account in determining if the Commissioner's discretion to grant an extension of time should be exercised in this case. Justice Jenkinson considered the meaning of the phrase "error or omission" and found that this should not be given a restricted meaning since:
"………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."
He also accepted that the failure to do the act or take the step cannot itself be the error or omission. At page 584, Jenkinson J, referring to section 160(2)(a), which was the corresponding extension of time provision under the 1952 Patents Act, says:
"Section 160(2)(a) confers a power so conditioned that in my opinion its exercise is not lightly to be granted, and a power to be invoked only upon a prompt, frank, comprehensive and clear disclosure of all the circumstances relevant to the weighing of the discretionary considerations upon which grant or refusal of an extension of time will depend."
At page 583 he found that, in order to make out a proper case justifying an extension:
"………an applicant would in my opinion have to go beyond a disclosure of the processes by which an agent's errors came to be committed, and would have to expose frankly, inter alia, all the conduct, knowledge, beliefs and mental processes (or, in the case of corporation aggregate, of the relevant officers and other agents) relevant to an understanding of the way the failure to do the act or take the step occurred, or relevant to an evaluation of the reasonableness of that conduct."
I thus need to consider what was the error or omission by the person concerned or circumstances beyond the control of the applicant in this case. I must also consider whether the applicant has made a prompt, frank, comprehensive and clear disclosure of all the circumstances by taking into account all relevant factors. Finally, I must also consider whether there is a causal link between the error or omission and the failure to pay the fees on time.
DISCUSSION
GST argued that the error or omission they made was to act in accordance with the 4 October 1995 letter from Pizzeys. This letter does not make any reference to the fact that application 32815/95 is a divisional application. It is likely to be a standard letter Pizzeys send to their clients and, in this case, would appear to have been sent in error. The letter states that the continuation fees are due from the third anniversary of the filing date, which is erroneous given that it was filed as a divisional application. Since it also acknowledges that the filing date was 21 September 1995, the inference is that continuation fees would have been due on 21 September 1998.
How did the applicant act in accordance with the letter from Pizzeys?
I would expect that applicants or their attorneys would generally maintain some sort of diary or watching system to ensure that fees are paid and actions completed on time which could be either an automated or manual system. GSA allege that neither GST nor Mr Abaza entered the continuation fee requirements for 32815/95 onto any sort of diary reminder system. In Mr Stack's declaration in the evidence in answer he admits that he "did not enter a continuation fee required for 2 March 1998 in any diary kept by me." However, Mr Stack does not indicate if he had entered a different date in his diary or if a date for payment of fees was recorded in some other diary system maintained by someone else. At paragraph 14 of his declaration he asserts that he "took reasonable steps to ensure that wherever fees were required were met in a timely fashion." No other evidence on a diary reminder system has been provided by GST, which certainly leaves a very big question over the manner in which the applicant intended to ensure that any continuation fee payments were made on time for application 32815/95. If indeed GST were under the impression that fees were due, not on 30 August 1997 but on 21 September 1998, then surely they should have been able to provide evidence of a diary reminder entry for that date if such a system existed.
Mr Abaza's declaration in support of the section 223 application does not give any explanation of how he acted in accordance with the advice from Pizzeys and does not refer to any type of diary system. Mr Abaza is the address for service for GST and is obviously acting as a professional advisor for them in relation to their patent matters. However, nowhere in either the request for extension or Mr Abaza's submissions does he give any indication of what his role is in relation to record keeping for the purposes of ensuring fees are paid on time. Mr Abaza does not make any mention of any type of fee reminder or diary system.
I note that, following the advice from the Patent Office that the application had lapsed, it was Mr Abaza who declares that he immediately paid the fee. This suggests that, at least in March 1998, Mr Abaza had some responsibility for payments of fees for application 32815/95. In the absence of any other information, it is not possible to determine what his role was in this regard before this time. However, I note that following the lapsing of the application, Mr Abaza has persisted in randomly paying amounts of money which did not relate to any fee item and without specifying even which of the applicant's patent matters the money was for.
As noted above, Mr Abaza failed to produce any documents at all in response to the notice for production issued on him in this regard. I find it very hard to believe that Mr Abaza, as the professional adviser and address for service for GST for application 32815/95, did not maintain some records to ensure timely payment of fees or else make use of a reminder system provided by someone else.
From this I can find no direct evidence that either the applicant or their advisor, Mr Abaza, used a diary system, or any other reminder system, to ensure fees for patent application 32815/95 were paid on time. It is plausible that there was no diary system. However, if this is the case, I cannot find a causal link between the letter from Pizzeys and the failure to pay the fees. The letter from Pizzeys does not appear to have triggered any action and GST has not demonstrated any clear intent to pay the fees. There has been no explanation at all of what action was taken. If there was in fact a diary system, neither GST nor Mr Abaza have acknowledged its existence or provided any evidence about such a system, despite being given ample opportunity to do so.
As a result, I am unable to conclude how GST acted in accordance with the advice from Pizzeys and can find no causal link between the letter and the failure to pay the fees.
Did GST access other sources of information about the continuation fees?
GSA also allege that Mr Stack had access to other sources of information about the continuation fee date, in addition to the Pizzeys letter. Mr Stack admits this himself at paragraphs 26 and 27 of his declaration:
"26. I have made access to available information from the data bank records kept first at Adelaide Street and then at King George Square Brisbane offices of the Patent Office and have conducted printout searches from time to time in respect of the Company's progressing of its standard patent application.
27. No search performed disclosed a doomsday problem prior to Australian Government Solicitor for the Commissioner recording in a letter received about 2 days after the asserted doomsday event that doomsday event."
These two paragraphs are not very clear and, unfortunately were not expanded upon by Mr Abaza in his submissions. I can only interpret the "doomsday problem" to be referring to the lapsing of the application. However, I am unaware of the letter mentioned by Mr Stack in paragraph 27. Since neither party has tendered this letter in evidence I am unable to comment further on that. The only relevant letter on our files appears to be the letter from the Patent Office to Mr Abaza dated 10 March 1998 advising that application 32815/95 had lapsed.
Paragraphs 26 and 27 are dealt with by Mr Collins, for GSA, in his evidence in reply. I am in agreement with Mr Collins that the searches referred to by Mr Stack must be in respect of application 32815/95. Mr Stack is asserting that he accessed data base records from our Brisbane State Office and, according to Mr Collins' declaration at paragraph 6:
"I believe that since 1990, or thereabouts, only one form of search has been available to members of the public conducting patent application status searches at the Brisbane Sub-Office. That search involves accessing the computerised database of the Patent Office, Canberra, and thereby obtaining a "Patent Administration System" report on the status of the patent application of interest. A "print-out" of the status report is available to the searcher. I further believe that the nature of the information provided by such reports has remained unchanged since 1990, or thereabouts. In the case of an application for a standard patent, I believe all such reports obtained since 1990, or thereabouts, have indicated the next due date for payment of a continuation fee."
Exhibits TJC1, TJC2 and TJC3 are copies of Patent Administration reports printed out by Phillips Ormonde & Fitzpatrick on 7 August 1996, 18 October 1996 and 28 May 1997 respectively in relation to application 32815/95. Each report shows that the patent office system records that the fees were paid to 30 August 1997. I believe that this information would have been available to Mr Stack upon enquiry at the State Office. In light of the statement in his declaration, it is likely that the search he refers to would have given him information concerning the due date for payment of the continuation fees. Mr Abaza did not refute this point in his submissions.
Mr Stack's declaration does not state when he accessed the databases but makes reference to two different addresses of the Brisbane State Office, Adelaide Street and King George Square. I am aware that the old address of the State Office was on Adelaide Street and the present address is still on Adelaide Street but overlooks King George Square. The move to the new office took place around October 1996 so it would appear from his declaration that Mr Stack accessed the information at the old address, which was prior to the date on which the continuation fees were due.
From this it would seem that Mr Stack, on his own admission, would have had access to information which showed the due date of 30 August 1997 for payment of the continuation fees for application 32815/95. If this is the case, there is certainly no causal link between the Pizzeys letter and the failure to pay the fees, as Mr Stack would not have been relying on that letter. However, the evidence before me is not conclusive and I cannot say for certain if Mr Stack was aware that the continuation fee was due on 30 August 1997 or if he appreciated the importance of paying the fee by that date.
Did Pizzeys have a continuing involvement with this application?
In Mr Collins' view, it is likely that Pizzeys or the new firm had a continuing involvement with application 32815/95, even after November 1995, when Mr Abaza was appointed as the address for service. If that was the case, Mr Collins submitted that it is reasonable to assume that Pizzeys would have entered application 32815/95 into their renewal reminder system. It is also reasonable to assume that Pizzeys' system caters for the special requirements for divisional applications.
There seems to be no doubt that Pizzeys were the original address for service and patent attorneys in regard to application 32815/95 until the address for service for the applicant changed to Mr Abaza. The Patent Office was informed of this change by a letter from Pizzeys dated 6 November 1995. Mr Abaza remains the address for service in regard to application 32815/95. However, in his declaration accompanying the section 223 request dated 13 March 1998, Mr Abaza asserts that he acts for GST in regard to its patent applications, including 32815/95, "in conjunction with Messrs Pizzey & Company, Patent Attorneys of Brisbane". This suggests some continuing involvement by Pizzeys but the nature of that involvement is not at all clear.
In another letter dated 26 November 1998 from Pizzeys to the Commissioner, they confirm that Pizzey & Company ceased to act for GST in this matter in November 1995, although a new firm, Pizzeys Patent & Trade Mark Attorneys "took over the files previously handled by Pizzey & Company". This letter was in regard to the request for production of documents and advises us that:
"…..during the period 21 September 1995 to 12 March 1998, there is a letter from Pizzey & Company to their clients which relates to the matter in question. I have been instructed by G S TECHNOLOGY PTY LTD not to provide you with copies of any correspondence between Pizzey & Company and themselves. As was previously advised, the documents were subject to claim of privilege in the Federal Court and I understand that my claim to privilege was observed by the Court."
Mr Collins submitted that the letter referred to above is not the 4 October 1995 advice, since that has already been provided to the Commissioner, but some other letter. However, there is no evidence from any of the parties to confirm or refute the existence of another letter relating to the matter of continuation fees.
Mr Collins pointed out that Pizzeys "have not alleged lack of continuing involvement in the matter of patent application 32815/95" and that opportunity for them to do this occurred when the notice for production was issued. At no time did Pizzeys suggest that they did not have the documents sought by the notice, only that the documents had been delivered to the Federal Court and that the contents of the file were privileged. Mr Collins also submitted that Pizzeys at no time gave any indication that the file delivered to the Court was incomplete, which would seem to be the case if their involvement ended in November 1995.
However, I make note that the notice was served on Pizzey & Co whereas the 26 November 1998 letter from Pizzeys indicates that Pizzey & Co ceased operating as of 30 December 1995. Their files were taken over by Pizzeys Patent & Trade Mark Attorneys. It may be that the new firm did not feel obliged to comply with the notice because it was served on a company that no longer existed.
I believe that both Pizzeys and Company and Pizzeys Patent and Trade Mark Attorneys are likely to maintain patent fee reminder systems which would have been available to GST if they had requested that service. What is not clear though is whether GST had any continuing involvement with either of these firms since Mr Abaza was appointed as their address for service. GSA suggests that they did but due to lack of evidence and submissions on this issue, I am unable to determine this conclusively. Either way though, a causal link between the 4 October 1995 Pizzeys letter and the failure to pay the fee has still not been established.
Did GST give priority attention to other matters?
GSA further allege that one reason why the fee was not paid may have been that GST had given priority attention to other matters, such as the Federal Court appeal concerning petty patent AU 645740, at the expense of the prosecution of application 32815/95. At paragraph 29 of his declaration, Mr Stack states that "there has never been any deliberate decision to give priority attention to matters other than the matter of ensuring timely payment of whatever fees are due in the Patents Office." However, in the request for extension of time, Mr Abaza describes at paragraphs 5 and 6 the Federal Court proceedings in relation to petty patent 645740. These protracted proceedings are given as another reason for the "misinterpretation" resulting in the continuation fees not being attended to by 2 March 1998.
At paragraph 24 of his declaration, Mr Stack refers to circumstances beyond the control of the Company in connection with the failure to pay the continuation fee. He then mentions that 30 August 1997 was "a date when the Company was in any event litigating one of the applications in the Federal Court concerning the applications for patents." The declaration by Ian Stanley Pascarl (from the firm Minter Ellison) and attached exhibits ISP1 to ISP5 attest to the fact that Court proceedings QG28 of 1994 and QG29 of 1996 were held concurrently, commencing on 1 December 1997.
I am unable to determine whether or not GST gave priority attention to other matters. However, if that were the case, I would not consider that to constitute an error or omission justifying the Commissioner's discretion to allow the extension. Nor do I consider that to constitute circumstances beyond the control of the applicant. Any decision by an applicant to devote time to other matters such as the Federal Court appeal rather than properly deal with prosecuting a particular patent application appears to me to constitute a deliberate decision, not an error or omission. This is analogous to the situation in Weir Pumps Ltd and Commissioner of Patents and and Stork Pompen BV 13 IPR 163 (decision of the AAT) when it was found that since the opponent had made a deliberate policy not to maintain a watch for pending patent applications, their actions did not fall within the phrase "error or omission".
Was there any other possible error or omission?
Having been unable to conclude how GST acted in accordance with the letter from Pizzeys, I need to consider if there was any other error or omission that resulted in the fees not being paid. It would seem unlikely that it was in the applicant's interest for application 32815/95 to lapse – and I note that the continuation fees were paid as soon as the Office notified GST that the application had lapsed. Mr Stack, in his declaration, asserts that "the endeavour to progress the Company's patents and applications for patents has been a matter of almost daily attention by me, the Company and its advisers." He then lists a long chronology of events concerning application 32815/95 and the related petty patents. All these matters have been the subject of numerous Patent Office and Court actions and decisions. Likewise, Mr Abaza asserts in his submissions that the applicant always intended to proceed with this application.
However, the fact remains that the fees were not paid by the due date. It is the responsibility of an applicant or their representative to pay the required fees on time in order to prevent their patent application from lapsing (see for example Reilly v Commissioner of Patents (1996) AIPC ¶91-217) I note that the failure to pay the continuation fee cannot itself be the relevant error or omission in regard to the section 223 application [see Kimberly-Clark Ltd v Commissioner of Patents and Another (No3) (supra)].
One possible error could be that the applicant did not understand the requirement for fees to be paid. Mr Stack admits that he found the provisions of the Act and Regulations in regard to this matter to be "extremely difficult and complex to understand." Paragraph 31 of his declaration also demonstrates his lack of understanding of the continuation fees as they relate to divisional applications. In paragraph 33, Mr Stack indicates that he believed that "the Company was in credit for all possible fees including those which had been paid "early" in respect of progressing the associated patent 662284". At paragraph 15 he asserts "I also re-state my belief the Company was in credit for fees and that the Company always considered that moneys paid to the Patent Office were to the general matter of progressing its applications for patents."
This gives some indication that Mr Stack has no real appreciation of the patent fee system, where an applicant must actively pay a particular fee for any given application by a certain date. The Office does not operate an accounting system where an applicant's fees are taken from some large bucket of money relating to all their patent applications.
However, as I noted above, the applicant has chosen to use the services of Mr Andrew Abaza as a professional advisor in regard to patent application 32815/95. Mr Abaza is a Solicitor and has acted for GST in numerous actions in relation to both this application and the related petty patents. He has represented GST before the Commissioner on many occasions; and he has represented GST before the Federal Court on several occasions on appeal from decisions of the Commissioner. It is thus readily apparent to me that Mr Abaza has a commensurate understanding of patent law and the practice of the Australian Patent Office. GST has not given a lack of understanding of the fee system as a reason for the fee not being paid and I have no reason to conclude that this was the case.
DECISION
The action not carried out in time in this case was the payment of the sixth year continuation fee for application 32815/95, which was due on 30 August 1997. The reasons given by the applicant for not paying the fee by that date relate to incorrect advice given by Pizzeys as to the due date for payment and protracted proceedings in the Federal Court concerning the related petty patent 645740.
However, no evidence has been tended to show how GST or Mr Abaza acted on the advice from Pizzeys. There has been no evidence or submissions concerning who was responsible for paying the fees and what systems, such as a diary or other reminder system, were in place to ensure that the continuation fee was paid. There is no evidence which proves the existence or otherwise of a diary or reminder system. It is plausible that there was no diary system. However, if this is the case, I cannot find a causal link between the letter from Pizzeys and the failure to pay the fees.
I have also found above that Mr Stack may have accessed information concerning the correct date for payment of the continuation fees at the State Office. If Mr Stack did have this information, there is certainly no causal link between the Pizzeys letter and the failure to pay the fees, as Mr Stack would not have been relying on that letter. I find it quite plausible that Mr Stack did obtain information about the due date for the continuation fees from the State Office but the evidence provided is not conclusive.
I have been unable to determine conclusively whether either Pizzeys and Company or Pizzeys Patent and Trade Mark Attorneys had any continuing involvement with application 32815/95, due to lack of evidence. Either way though, a causal link between the 4 October 1995 Pizzeys' letter and the failure to pay the fee has still not been established.
I have found above that if the applicant made a deliberate decision to direct its attention to other matters at the expense of application 32815/95, this does not constitute an error or omission as required by section 223.
The failure to pay the fee cannot itself be the error or omission. In looking for another error or omission, I considered whether GST and Mr Stack may not have understood the patent fee system. However, this was not given as a reason for the fee not being paid. GST has obtained professional advice from Mr Abaza who has acted in relation to both this application and the related petty patents before the Office and the Federal Court. From this it would seem apparent that Mr Abaza has both knowledge and understanding of the patent fee system and would understand that fees are required to maintain a patent application. Thus, this reason cannot constitute the error or omission as required by section 223.
In conclusion, I can find no causal link between the 4 October 1995 letter from Pizzeys and the failure to pay the fee and can find no other relevant error or omission. Acting in accordance with the letter from Pizzeys was given as the primary reason for the failure to pay the continuation fee but the applicant has not provided me with sufficient evidence to be able to determine what happened and much of what they have provided is conflicting. I believe that knowledge of the relevant facts lies squarely with the applicant or their representative but (for whatever reason) they have chosen not to give me a full and frank disclosure of those facts.
Because of this lack of evidence, I need to consider whether I should allow the applicant additional time in which to provide me with further information. However, I believe that GST has already had ample opportunity to put in all relevant material, including the opportunity to respond to the opponent's notices for production. As a result, I do not consider it necessary or appropriate in all the circumstances to give them this opportunity.
The grant of an extension of time under the provisions of section 223 is discretionary. I have considered all the issues and have had regard to the principles outlined in the decision in Kimberly-Clark Ltd v Commissioner of Patents and Another (No3) (supra). In exercising the discretion, I need to balance:
the unlikelihood that it was in the applicant's interest for application 32815/95 to lapse
against
the lack of any causal link between the letter from Pizzeys and the failure to pay the fee;
the apparent absence of any other plausible error or omission; and
the lack of a full and frank disclosure of all relevant facts
Having regard to all the circumstances, I consider that in this case the balance weighs in favour of refusing the extension.
Thus, I refuse the application under section 223 for an extension of time to pay the sixth year continuation fee and as a result, the application remains lapsed under the provisions of section 142(2)(d) for the failure to pay that continuation fee.
COSTS
Since I have found that the opposition has been successful and the extension of time refused, I award costs against the applicant GST. At the hearing, Mr Collins requested that he would wish to make submissions on costs and the award of costs above schedule 8 in the event of the opposition succeeding. He referred to a number of issues involving unnecessary expense and inconvenience caused to GSA by the applicant.
Under the provisions of regulation 22.8, I must not award costs above those specified in Schedule 8 unless both parties have had a reasonable opportunity to make submissions on the award of those costs. I thus allow GSA 2 weeks from the date of this decision to provide written submissions on the award of costs above those specified in Schedule 8. Once submissions have been received, these will be forwarded to GST who will be allowed 2 weeks to provide their submissions in response. The parties should note that their submissions should solely be restricted to the issue of the award of costs as this is not an opportunity to make further submissions on any other issues.
Gillian Jenkins
Deputy Commissioner of Patents
Solicitor for the applicant : Mr Andrew Peter Abaza, Brisbane
Patent attorneys for the opponent : Phillips Ormonde & Fitzpatrick, Melbourne
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