Genentech, Inc. v Eli Lilly and Company

[1988] APO 9

In the Matter of the Patents Act 1952 - and - In the Matter of Application No. 563347 for a Patent by GENENTECH, INC. - and - In the Matter of Opposition thereto by ELI LILLY AND COMPANY - and - In the Matter of an Application for Extension of Time within which to Serve Evidence-in-Support.

 

DECISION OF A SUPERVISING EXAMINER OF PATENTS:

Background

Patent application 563347 for an invention entitled "Methods and Products for Facile Microbial Expression of DNA Sequences" was advertised accepted in the Official Journal on 9 July, 1987. A notice of opposition to the grant of a patent on the application was lodged by ELI LILLY AND COMPANY (LILLY) on 7 October, 1987.

On 7 January, 1988 LILLY lodged a statutory declaration by Dr. Calvin N. Sparrow which constituted part of the evidence-in- support. Also lodged was an application for extension of time seeking to extend the time for serving evidence-in-support until-7 April, 1988. GENENTECH through its patent attorneys gave notice of its objection to the extension application being granted and in accordance with practice, the matter was set down for hearing. The hearing was held in Canberra on 4 March, 1988. Dr. J.F. McCann, patent attorney of Spruson & Ferguson, Sydney represented the applicant for the patent, and Mr. J. Murray, patent attorney of Edwd. Waters & Sons, Melbourne represented the opponent.

Application

With respect to the granting of extensions of time in opposition proceedings, regulation 83A of the Patents Act requires that "... the Commissioner shall not grant the extension of time unless he is satisfied that the extension is justified having regard to all the circumstances of the case". I therefore need to consider the reasons advanced both for and against the present extension as provided by the parties.

The circumstances and grounds given in the present application for extension of time are as follows:

"Part of the evidence-in-support has been lodged. Further time is required to allow local experts to consider the patent application and the prior art and enable the preparation of the complete evidence-in- support."

At the hearing, Mr. Murray made a number of points to support the extension of time application. I summarise the main ones as follows:

(i) A serious opposition is envisaged as the opponent has engaged a barrister and solicitor to handle the opposition;

(ii) A good deal of time has been involved in not only briefing the barrister of the intricacies of the technology, but also in locating a suitable person to do so;

(iii) As the technology of patent application 563347 is comparatively new, there was a great deal of difficulty in locating persons with the relevant expertise as of the priority date (i.e. 18 September, 1981). (It is believed by the opponent that there were only about six such persons in Australia in the late 1970's);

(iv) Evidence for the opposition needed to relate to the requirements and practice under Australian Patent Law;

(v) Other references apart from those in the Sparrow declaration would be relied upon in the opposition and these need to be fully considered by the experts;

(vi) Because of the intervening holiday period there was difficulty in arranging meetings between the experts and counsel.

In general, Mr. Murray's submissions indicated that the initial 3 months allowed for service of evidence had been insufficient for the opponent to conduct conferences with legal advisers regarding the opposition action, locate suitable experts in the art and for them to fully consider the matter, and to prepare evidence accordingly. He indicated that these aspects had been diligently pursued prior to 7 January, 1988 and, in anticipation of the present extension being allowed, since that date with a view to completing the opponent's evidence as soon as possible.

In its objection to the extension application, GENENTECH stated that:

"Related proceedings on applications corresponding to and analogous to the opponent's application have been commenced in other jurisdictions and in view of the state of evidence already served in those other jurisdictions it is clear that the opponent has had sufficient time to prepare and serve evidence in support in these proceedings."

In addition, at the hearing, Dr. McCann contended that the opponent had not provided, by way of the reasons given in the application for the extension of time or in the submissions made by Mr. Murray, sufficient grounds to justify the extension sought. Dr. McCann's submissions in support of this contention can be summarised as follows:

(i) Because of the past dealings between GENENTECH and LILLY in relation to other related patent applications overseas, the opponent would have been aware of the issues involved since at least March 1984 and should have been able to file its evidence within the 3 month period available;

(ii) GENENTECH gave the opponent one months notice that any extension application would be objected to, and in the light of (i) above, LILLY then should have completed its evidence by the due date;

(iii) There are many experts in this particular field in Australia and so consequently there should not have been any difficulty in locating appropriate witnesses;

(iv) LILLY's actions do not indicate that there is a serious opposition, just an effort to delay the grant of a patent.

In reply to these submissions, Mr. Murray contended that while the overseas proceedings are of interest, they are of academic interest only since an opponent has to consider the accepted patent application under Australian law and in the light of any prior art and evidence which would not have been looked at overseas.

Decision

The law on extension of time in this class of action has been comprehensively reviewed in Vangedal-Nielsen v. Smith (1980) 33 ALR 144 and in Lyons v. Registrar of Trade Marks 1 IPR 416. It is apparent therefrom that in deciding whether an extension of time should be allowed, the Commissioner

(i) must be satisfied that an applicant who seeks such an extension has made out a proper case justifying the extension, and

(ii) must consider not only the respective interests of applicants and opponents, but also those of the public by ensuring that worthless patents are not granted and that there are no unreasonable delays in the proceedings.

Additionally, it is important - respecting evidence-in-support and an opponent's interest - that an opponent should not be deprived of further prosecuting its opposition merely because it has had insufficient time to compile and bring material evidence before the Commissioner. Nevertheless, it is clear from the above decisions that the applicant for the extension of time carries the onus of proof.

I turn now to a consideration of the circumstances in this case. As it is the basis of the objection to the extension application, I will consider the matter of the related actions overseas between GENENTECH and LILLY first. Dr. McCann submitted that as a result of these actions, LILLY should have been aware of the issues involved and have had its evidence for the present opposition already prepared. It seems to me that whether the opponent ought to have been in such a position is dependent on the facts of the case, and in that regard the following points are relevant. Firstly, an opponent cannot be certain of the relevance of any evidence it may have obtained during the course of any overseas actions until the application and complete specification have been advertised accepted in Australia. Secondly, such evidence may not be of any value if it was not publicly available in this country. Furthermore, where one of the grounds of opposition is that of obviousness, it is necessary to consider the common general knowledge in the art in Australia and thus an opponent would need to obtain appropriate evidence from qualified experts in the art. This latter type of evidence may not have arisen in any of the actions that have taken place between the parties overseas. It could be said that LILLY should have prepared any additional evidence it was going to rely on in respect of the present patent application at an earlier date. However, I consider that it would be unreasonable to expect an opponent to devote perhaps considerable resources to obtaining evidence before it was aware of the scope of the accepted claims and had decided to lodge a notice of opposition thereto. Therefore, while the overseas actions would have provided material to assist in the formulation of part of the opponent's evidence, I accept Mr. Murray's argument that to prosecute the opposition fully, further evidence needed to be obtained which is of particular relevance to the art in Australia and to the requirements of Australian law.

In response to Mr. Murray's third submission, Dr. McCann contended that there are many experts in the field of biotechnology in Australia and consequently there should have been no problems in locating an appropriate person. While there may be a reasonable number of experts in this field at the present time, such does not appear to have been the case in 1981. From Mr. Murray's submissions it seems that at that time there were only about six such persons in Australia. Consequently, I accept that there would have been difficulties in locating an appropriate expert in the comparatively new field of biotechnology. In addition, Mr. Murray submitted that he had been advised that the specification had more than one addressee and thus the opponent had to locate experts in DNA technology and gene expression. Therefore I conclude that the difficulties said to be encountered are reasonable in the circumstances.

In regard to Mr. Murray's second and sixth submissions, I do not consider that these delays are unreasonable considering the nature of the particular technology in question, the need to locate experts and problems encountered with the end of year vacation period in Australia.

Regarding Dr. McCann's second submission concerning the foreshadowed objection to an extension of time application, this of itself is of little relevance to the matter. The overriding issue for consideration is whether the party seeking the extension has made out a proper case justifying the extension sought, and clearly if such a case is established it is somewhat unrealistic to suggest that that party ought to have completed its evidence earlier in the face of a foreshadowed objection.

Finally, I do not agree with the applicant's submission that LILLY's actions do not indicate that a serious opposition is envisaged. LILLY has already filed part of its evidence in support and has devoted considerable resources to obtaining legal advice and assembling a team of experts etc. to formulate the further evidence that will be relied upon. I note also that after the hearing, Mr. Murray was to have a meeting with two experts who were both in Canberra at that time. These are all actions which indicate to me that LILLY is indeed serious in its opposition.

Having due regard to the reasons for the extension of time and the submissions at the hearing, I conclude that LILLY has made out a proper case justifying the extension. Furthermore I am satisfied that the opponent is pursuing a serious opposition and hence I consider that it is in the public interest to extend the time for LILLY to serve its evidence-in-support of its opposition. Consequently I allow the extension of time until 7 April, 1988.

On the question of costs, it seems to me that GENENTECH not unreasonably objected to the extension of time application given its prior notice to the opponent of a foreshadowed objection and the brief reasons on the application itself. on the other hand, the opponent has justified to me its need for the extension largely by way of the submissions on its behalf at the hearing. In the circumstances I consider that each party should bear its own costs in this matter.

At the hearing Mr. Murray indicated that given the developments in respect of preparing the additional evidence in the period since 7 January, 1988, a further extension of time beyond 7 April, 1988 may well be required and sought. Any such further extension of time, if sought, will of course require consideration on its merits at the appropriate time.

(T.R. BRUHN)

Supervising Examiner of Patents

24 MAR 1988

Patent attorneys for the opponent : Edwd. Waters & Sons

Patent attorneys for the applicant : Spruson & Ferguson