Grasslanz Technology Limited v Agriculture Victoria Services Pty Ltd
[2018] APO 47
•13 July 2018
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Grasslanz Technology Limited v Agriculture Victoria Services Pty Ltd 2018 APO 47
Patent Application: 2011204749
Title:Endophytes and related methods
Patent Applicant: Agriculture Victoria Services Pty Ltd
Opponent: Grasslanz Technology Limited
Delegate: S. Calanni
Decision Date: 13 July 2018
Hearing Date: 28 November 2017, in Canberra
Catchwords: PATENTS – opposition to the grant of a patent – amendment of the statement of grounds and particulars – request for amendment of the statement of grounds and particulars refused – regulation 5.23 – considered novelty – whether two endophyte strains are the same – lack of novelty not established – inventive step – inventive step not established – costs – submissions on costs not made – parties allowed 1 month to make submissions on costs
Representation: Counsel for the applicant: Mr David Shavin, QC
Patent attorney for the applicant: Debra Tulloch of Jones Tulloch
Counsel for the opponent: Mr Chris Burgess
Patent attorney for the opponent: Kate McHaffie of AJ Park
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2011204749
Title:Endophytes and related methods
Patent Applicant: Agriculture Victoria Services Pty Ltd
Date of Decision: 13 July 2018
DECISION
The opposition was unsuccessful on all grounds.
I allow the parties 1 month from the date of this decision to provide written submissions in relation to costs.
REASONS FOR DECISION
Background
Application 2011204749 (the present application) was filed by Agriculture Victoria Services Pty Ltd (AVS) on 7 January 2011. The application claims priority from two priority documents, 2010900054 and 2010902821, which were filed on 7 January 2010.
Following examination, the present application was advertised as accepted on 27 August 2015. A Notice of Opposition was filed by Grasslanz Technology Limited (Grasslanz) on 26 November 2015.
The statement of grounds and particulars (SG&P) filed on 29 February 2016 sets out the following grounds of opposition: novelty (prior publication), inventive step and lack of sufficiency.
The evidentiary stages of the substantive opposition were completed on 3 January 2017. After a significant stay in the opposition pending settlement proceedings, the Commissioner set the hearing for 28 November 2017.
An amended statement of grounds and particulars was filed just prior to the hearing, on 16 November 2017. The parties each provided written submissions with regard to the proposed amendment to the SG&P, and having briefly considered these submissions the Commissioner advised the parties that it would be considered at the hearing. The parties provided submissions on this matter at the hearing as discussed below.
Amendment of the Statement of Grounds and Particulars
A request to amend the SG&P was filed on 16 November 2017, the same day that Grasslanz filed their written submissions for the oral hearing. The amendment sought to introduce additional particulars under the grounds of novelty and inventive step.
Regulation 5.16 of the Patent Regulations 1991 (the “Regulations”) states:
(1) An opponent may request the Commissioner in writing to amend the opponent’s statement of grounds and particulars:
(a) to correct an error or omission in the grounds of opposition; or
(b) to update the grounds of opposition to reflect an amendment to the patent request or complete specification to which the statement relates; or
(c) to amend the facts and circumstances forming the basis for the grounds.
(2) The Commissioner must:
(a) notify the applicant of the opponent’s request; and
(b) give the parties an opportunity to make representations about the amendments.
(3) The Commissioner must not make the amendment if:
(a) The Commissioner is considering an application for dismissal of the opposition under Part 5.4; or
(b) For an opposition begun under subregulation 5.4(1):
(i) the applicant’s complete specification is being re-examined; and
(ii) the re-examination is not completed as required by regulation 9.5.
(4) The Commissioner must make the amendment if :
(a) Subregulation (3) does not apply; and
(b) The Commissioner is satisfied that the amendment should be made.In the present case the purpose of the amendment was to correct the error or omission in the grounds of opposition in accordance with subregulation 5.16(1).
The proposed amendments can be summarised as follows:
·amendment to limit the pleadings to the claimed endophyte NEA12.
·inclusion of additional particulars under the ground of novelty to include prior use by the deposit of the AR37 endophyte and its commercial sale in association with various commercial ryegrass varieties.
Relevant considerations
The relevant considerations when determining whether it is appropriate to make amendments to the SG&P were considered in CSL Limited v Isconova AB et al. The factors include:
·the prospect of undue prejudice to a party — for example, the applicant may be unduly prejudiced by unnecessary delays in seeking amendment, or by the introduction of further particulars that change the case the applicant has to answer (as discussed in Diamond Scientific Company v CSL Limited(Diamond); and
·the timing of the amendment request and the reasonableness of the explanation of the delay; and
·the public interest — noting that a correct determination of the opposition is one based on the issues properly raised in the opposition proceedings.
In the present case Grasslanz submitted that
“During the preparation of the opponent's outline of submissions for the upcoming hearing on this matter, it was noticed that the statement of grounds and particulars was inadvertently not amended following the testing of the claimed endophytes to add particulars relating to the results of that testing (as presaged by paragraph 1.4).
Evidence relating to the analyses conducted by the opponent on the NEA12 and AR37 endophytes was referred to in the Faville declaration, and evidence about the publication of the AR37 endophyte through the acts of deposit and commercial sale was referred to in the Caradus declaration. The Applicant put on evidence in answer regarding the opponent's analyses and the disclosure of AR37 in the Arnold affidavit and Guthridge declaration.”Submissions
The central submission provided by Grasslanz was that the proposed amendments do not substantially change the case AVS has to answer. They noted that the evidence in support included:
·a comparison of the endophytes NEA12 and AR37 (Faville declaration); and
·information relating to the deposit and commercial sale of AR37 (Caradus declaration).
Furthermore, they asserted that the evidence in answer filed by AVS considered and addressed the comparative analysis of the two endophytes, as well as the disclosure of AR37.
AVS submitted that they had prepared their case based on grounds pleaded in the original SG&P, specifically a paper anticipation based on D1 and D2. They stated that the amendments proposed completely change the case to one that was not reasonably discernible from the evidence adduced by the opponent. They submitted that the full extent of the prior use case appears to be based on statements made in two paragraphs in the declaration by Dr Caradus that does not include the particulars required to assert prior use with respect to the commercial sale of AR37 or the microorganism deposit.
The prospect of undue prejudice
In Diamond Scientific Company v CSL Limited[1] the Assistant Commissioner stated:
“In my view the applicant has the right to know, at the time the statement of grounds and particulars is filed, the complete case that it has to answer in the opposition.
Where, for whatever reason, the statement is deficient and requires amendment to correct those deficiencies by adding particulars not specifically referred to in the original statement, the applicant will necessarily be prejudiced to some degree - in that the case they have to answer will be changed. Such prejudice is not necessarily undue. However, if there is any unnecessary delay in seeking a relevant amendment of the statement of grounds and particulars, the applicant will not timely know the case it has to answer - indeed they will not know until the opponent chooses to so inform them by seeking an appropriate amendment. Such delays are inconsistent with the function of the statement of grounds and particulars. Any delays in seeking a relevant amendment will unjustifiably hamper the preparation of the applicant's case in answer. It follows, generally speaking, that if there is any unnecessary delay in seeking amendment of the statement to include extra particulars, the applicant (at least) will be unduly prejudiced if the amendment is allowed.”
[1] [1992] APO 55; (1992) AIPC 90-927
Further, regarding amendments to the particulars the Assistant Commissioner stated:
“This is not to say, however, that all amendments to particulars will give rise to undue prejudice. Amendments to particulars may properly arise incidental to the preparation of the case - as distinct from efforts by the opponent to find a 'better' basis for its opposition. In my view, extra particulars that arise incidental to the preparation of the case which:
do not result in any protraction of the preparation of the case, and
are included by way of amendment of the statement of grounds and particulars at the earliest reasonable opportunity, and
do not substantially change the case the applicant has to answer in the opposition
will not prima facie give rise to the applicant being unduly prejudiced.”In the present case, the applicant has asserted that an amendment of the particulars to include prior use substantially changes the case the applicant has to answer. They submitted that had they understood that the evidence provided by Dr Carradus and Dr Faville was to be relied upon to allege prior use, they would have led more evidence in relation to the commercial embodiment of AR37.
Even though Dr Caradus discussed AR37 and the deposit and sale of said endophyte in the evidence in support, I agree with the applicant that the amendment of the particulars to include prior use changes the focus of case. Furthermore, I cannot cast-off their submission that they would have led additional evidence in relation to the commercial embodiment of AR37 had the ground of prior use been evident earlier, particularly given AVS raised a number of concerns with regards to the type of evidence provided in support of a claim of prior use. These included the type of evidence provided in relation to the commercial sale of AR37 and the fact that a direct comparison has not been made between the deposited endophyte designated AR37 and the endophyte of the present application. In addition, given that the proposed amendments to the SG&P were made after the filing of the written submissions for the hearing, I do not consider that they were made at the earliest reasonable opportunity.
I therefore consider that if the proposed amendments to the SG&P were allowed there is the prospect of undue prejudice against the applicant. This prospect weighs towards refusal of the request for amendment.
Timing and reasonableness of the request
Grasslanz provided no substantive explanation for the delay in making the amendment to the SG &P, merely indicating that there was an inadvertent oversight that was discerned when preparing the written submissions for the hearing.
I note that the SG&P included a statement that the opponent reserved the right to rely on further particulars. Nonetheless, there was a significant delay in the filing of the request to amend the SG&P, with the request only filed after the submissions for the hearing were filed, a delay of more than 15 months from when evidence in support was completed.
I consider that the consideration of these factors weighs towards refusal of the request.
The public interest
The public interest and the need for a correct determination of the opposition is a further consideration. As noted by AVS in their submissions,[2] the Deputy Commission in CSL v Isconova in considering the need for a correct determination of the opposition stated that “A correct determination of the opposition is the correct determination of the issues properly raised in the framework of the proceedings.” Clearly the prior use ground was not properly raised in the framework of the proceedings, in fact the applicant has not had the opportunity to file any evidence in relation to this ground. I therefore consider that the issue does not demand immediate consideration in the public interest.
[2] Applicant’s written submissions (AWS) at [11]
Conclusion
Overall, I consider the weight of the consideration lies with a refusal of the request. I therefore refuse the request for amendment of the statement of grounds and particulars.
Grounds of opposition
Grasslanz identified the following grounds of opposition in their statement of grounds and particulars:
·novelty
·inventive step
·sufficiency.
In a letter dated 23 November 2017 Grasslanz indicated that they would not press the ground of sufficiency. As such, I will not consider sufficiency in this decision.
Onus
The request for examination for the present application was filed on 18 February 2013. Accordingly substantive amendments of the Patents Act(the Act) brought about by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 do not apply to the present patent application. This includes the amendment to subsection 60(3A) that allows the Commissioner to refuse a patent application if satisfied on the balance of probabilities that a ground of opposition has been made out.
The onus of proof in this opposition proceeding lies with the opponent, who must establish that it is clear that a valid patent cannot be granted.[3]
[3] F.Hoffman-La Roche AG v New England Biolabs Inc [2000] FCA 283 at [29]; Commissioner of Patents v Sherman [2008] FCAFC 182 at [18], [22].
Evidence
The parties relied on evidence from a number of declarants as set out in the table below.
Evidence Declarant Date of declaration Reference Exhibits Evidence in support Dr Alan V Stewart 9 November 2015 Stewart #1 AVS-1 and AVS-2 Stewart #2 AVSReply-1 Dr John R Caradus 29 July 2016 Caradus JRC-1 Dr Martin J Faville 29 July 2016 Faville #1 MJF-1 to MJF-5 Evidence in answer Dr Katherine M Guthridge 13 October 2016 Guthridge KMG-1 to KMG-7 Professor A Elizabeth Arnold 31 October 2016 Arnold AEA-1 and AEA-2 Evidence in reply Dr Stuart D Card 22 December 2016 Card Dr Martin J Faville 29 December 2016 Faville #2 MJFReply-1 and MFJReply-2 Dr Wade J Mace 3 January 2017 Mace WJMReply-1 to WJMReply-6 Dr Paul H Maclean 3 January 2017 Maclean The specification
The present application relates to endophytic fungi (endophytes), specifically fungal endophytes found in association with the important forage grasses perennial ryegrass and tall fescue.[4]
[4] Opposed specification, page 1 lines 3-7
The specification states that these forage grasses are commonly found in association with fungal endophytes.[5] This association can lead to both beneficial and detrimental agronomic results, such as improved tolerance to water and nutrient stress, or improved resistance to insect pests.[6]
[5] Ibid, page 1 lines 7-8
[6] Ibid, page 1 lines 9-10
The specification indicates that there is a need for methods of molecular breeding of endophytes, as well as the isolation and characterisation of new endophyte strains having desired properties.[7]
[7] Ibid, page 1 lines 21-23; p. 2 lines24-25
With this in mind, the applicants carried out a large scale endophyte discovery program to establish a library of endophyte strains.[8] A number of perennial ryegrass and tall fescue endophytes were isolated and then characterised using simple sequence repeat (SSR) genetic markers and metabolic profile analysis of the toxin produced.[9]
[8] Ibid, page 4 lines 5-7; Example 1; Example 7
[9] Ibid, page 4 lines 8-11; Example 1; Example 7
Candidate endophytes for further evaluation were selected on the basis of their genetic profile and metabolic (toxin) profile. In particular, host-endophyte combinations producing significant amounts of lolitrem B were eliminated, as the ryegrass staggers syndrome produced by this alkaloid is the most important limitation for livestock production.[10]
[10] Ibid, Example 2
The specification specifically refers to six candidate endophytes, E1, NEA10, NEA11, NEA12, NEA 13 and NEA14. Each of these isolated endophytes was deposited with the National Measurement Institute (on 5 January 2010 or 23 December 2010) and have the accession numbers V10/000001, V10/000002, V10/000003, V10/000004, V10/030285 and V10/030284, respectively.[11]
[11] Ibid, page 7 lines 12-20
The Examples
The specification ends with 9 Examples. In terms of the present opposition, the most important examples are summarised below.
Examples 1 and 2 describe the identification and selection of candidate endophytes from a collection of perennial ryegrass accessions.
Example 3 describes the characterisation of the candidate endophtyes NEA10, NEA11, NEA12 and E1. Inoculation studies, analysis of the toxin profile, nuclear and mitochondrial genome analysis and alkaloid biosynethetic gene content were used to compare and contrast the candidate endophytes.
Examples 8 and 9 describe the evaluation of antifungal activity in a range of endophyte strains including NEA12, including assessment of metabolite expression by mass spectrometry.
The person skilled in the art
It is well established that many of the issues in an opposition are answered by reference to the person skilled in the art:
“He is the person to whom the patent is addressed and who must construe it. He is the person whose knowledge will determine whether a patent is novel. He is the person who will judge whether a patent is obvious.”[12]
[12] Root Quality Pty Ltd v Root Control Technologies Pty Ltd [2000] FCA 980; 49 IPR 225 at 241 [70].
The skilled person or addressee is a person who works in the relevant field of technology. The person, or team, is likely to have a practical interest in the subject matter of the invention,[13] and while they may be assumed to be well-versed in the relevant art, the person must be taken to be non-inventive.[14]
[13] Ibid at[71]-[72] referring to Catnic Components Ltd v Hill & Smith Ltd [1982] RPC 183 at 242 and General Tire[1972] RPC 457 at 485; Minnesota Mining[1980] HCA 9; 144 CLR 253 at 293[119].
[14] Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) (2007) 235 CLR 173 at 197
There was no dispute, and I agree, that each of the declarants in this opposition has experience and expertise relevant to establishing the knowledge of the relevant person skilled in the art. However, as noted by AVS, none of the declarants for the opponent is independent.[15] The same can be said for Dr Guthridge who is a named inventor on the present application. The only independent expert is Professor Arnold. Where necessary I will take this in to consideration when establishing the weight to apply to their evidence.
[15] AWS [24]
Claim construction
The principles to be applied in construing claims are well established. As discussed by Bennett J in H Lundbeck A/S v Alphpharm Pty Ltd:[16]
“...the words in a claim should be read through the eyes of the skilled addressee in the context in which they appear. Words used in a specification are to be given the meaning which the person skilled in the art would attach to them, having regard to his or her own general knowledge and to what is disclosed in the body of the specification...
The claims are part of the specification...While the claims define the monopoly claimed in the words of the patentee's choosing, the specification should be read as a whole...Those who attempt to elevate the "purposive construction" utilised by Lord Diplock in Catnic Components Limited v Hill & Smith limited...should understand the application of that approach to construction as explained by Lord Hoffman in Kirin-Amgen...It is not permissible to read into a claim an additional integer or limitation to vary or qualify the claim by reference to the body of the specification. However, terms in the claim which are unclear may be defined or clarified by reference to the body of the specification. ”[16] [2009] FCAFC 70;81 IPR 228 at [118]-[120].
The specification ends with 7 claims. Claim 1 is to:
A substantially purified or isolated endophyte having a desired genetic and metabolic profile, said endophyte being selected from the group consisting of E1, NEA10, NEA11, NEA12, NEA13 and NEA14 deposited with the National Measurement Institute under Accession Nos V10/000001, V10/000002, V10/000003, V10/000004, V10/030284 and V10/030285, respectively.
Claims 2-6 are each ultimately dependent on claim 1.
The key elements of claim 1 that must be construed to determine the scope of the claim are set out and discussed below.
Substantially purified or isolated endophyte
As referred to in the specification a substantially purified endophyte is one that is free of other organisms.[17] An isolated endophyte is one that is removed from its original environment.[18]
[17] Opposed Specification, page 7 lines 21-24
[18] Ibid, page 7 lines 25-28
Having a desired genetic and metabolic profile
The specification states that a ‘desired genetic and metabolic profile’ includes genetic and metabolic characteristics that result in a beneficial phenotype in a plant harbouring, or otherwise associated with, the endophyte.[19] The beneficial properties may include improved tolerance to water and/or nutrient stress and improved resistance to pests and/or diseases in the plant with which the endophyte is associated.[20] Reduced toxicity of the associated plant to grazing animals is another beneficial property that may be considered a desired metabolic profile[21].
…selected from the group consisting of E1, NEA10, NEA11, NEA12, NEA 13 and NEA14, deposited with the National Measurement Institute under accession numbers V10/000001, V10/000002, V10/000003, V10/000004, V10/030284 and V10/030285, respectively.
[19] Ibid, page 5 lines 24-26
[20] Ibid, page 5, line 27 – page 6 line 1
[21] Ibid, page 6 lines 10-11
This was the only element of the claim in dispute between the parties. I note that for the purposes of the present opposition the relevant endophyte is NEA12. I will only refer to this specific endophyte in the subsequent considerations. In relation to the claim element referred to above, I need to determine the scope of the phrase “NEA12 deposited with the National Measurement Institute under accession number VV10/000004”.
At the hearing Grasslanz submitted that the claim defines an endophyte strain. They submitted that as the endophytes described in the present application are asexual organisms, natural mutations will occur between different isolates of the same endophyte strain. They referred to the evidence provided by the applicant’s expert Professor Arnold:[22]
“…Typically there will be some degree of variation, for example, within populations at a given position in the genome, so if you were to look at a population of fungi in the same species, you might expect some degree of variation at a given position. If you were then to step outside that natural variation, a greater frequency of variation can identify different endophyte strains.”
[22] Arnold [69]
It was their submission that the skilled addressee would consider that a reference to NEA12 is to the endophyte strain. Further, the skilled addressee would understand that asexual reproduction results in offspring that are identical to each other and their parent except for mutation. The skilled addressee would expect that mutations to the genotype would occur between distinct isolates and would therefore consider an endophyte strain to include isolates of the endophyte that had acquired mutations, particularly where those mutations are not within the coding region and do not have a phenotypic effect.
In contrast, AVS submitted that the endophytes described in the present application are claimed in very specific terms. They submitted that the endophyte must be precisely the same organism to fall within the scope of the claim. In other words, the construction applied by AVS limits the claim to endophyte isolates that are genetically identical to those deposited.
Clearly the claim defines an endophyte which AVS has called NEA12. With respect to the deposit details specified in the claim, the primary purpose of this inclusion is to ensure that the invention is described in sufficient detail to permit a person skilled in the art to reproduce the invention. Throughout the specification, the endophytes that represent the invention are referred to as endophytes strains[23], or endophytes of a particular genotype[24].
[23] Opposed specification at, for example, page 4 lines 5-14; page 34 lines 1-15; page 41 lines 11-25.
[24] Ibid, Example 2
Professor Arnold has read the specification of the opposed application and described what it discloses. Her evidence establishes that she considers that the specification describes a number of different endophyte strains. For example, she states that:
“The document describes the process by which different accessions of grasses were sampled for endophytes, for example grasses collected from different locations. To me, a “plurality of samples of endophytes” means a number of different endophyte strains.”[25]
[25] Arnold [105]
Furthermore, her consideration of claim 1 states:
“Claim 1 refers to the purified and isolated endophyte strains that have desired genetic and metabolic profiles E1, NEA10, NEA11, NEA12, NEA13 and NEA14, with these endophytes having been obtained, purified and isolated and score for their genetic and metabolic profiles and deposited with the National Measurement Institute with standard accession numbers.”[26]
[26] Ibid, [119]
In terms of the scope of claim 1, I consider the deposit details simply restate that the claim is directed to an endophyte strain designated NEA12 and that the endophyte strain has been deposited with NMI and given the stated accession number. The specific isolate deposited with NMI is representative of the NEA12 endophyte strain, and I consider that any endophyte strain that is genetically identical and phenotypically the same as the strain deposited would fall within the scope of the claim.
Regulation 5.23
Prior to considering novelty there are two matters I must consider in relation to the evidence under regulation 5.23 of the Patent Regulations.
The first matter to consider under these provisions is whether WO 2004/106487 (WO ‘487) will form part of this opposition. While this document was filed with the SG&P, addressed in the evidence provided, and addressed in the parties’ written submissions filed prior to the hearing, it has not been filed as evidence in this opposition. WO ‘487 is the sole document relied on by Grasslanz in their submissions.
Regulation 5.23 is as follows:
- For or the purposes of deciding an opposition, the Commissioner may consult a document that:
a.is relevant to the opposition; and
b.has not been filed under this Chapter [Chapter 5 Oppositions]; and
c.is available at the Patents Office.
- If the Commissioner proposes to rely on the document, the Commissioner must give to the parties:
d.notice of the Commissioner’s intention to do so; and
e.a copy of, or access to, the document; and
f.an opportunity to give evidence or make representations about the document.
The application of regulation 5.23 was considered in Merial Limited v Bayer Intellectual Property GmbH:[27]
“…a decision under regulation 5.23 must have regard to the nature of the information and whether the information is likely, if not certain, to change the outcome of the opposition in a significant way.
If the new information is not likely to change the outcome of the opposition in a significant way, there is little advantage gained by bringing it into the opposition. The procedures for evidence laid down in regulation 5.23 will introduce delay to the opposition. On the other hand, if the new information is not relied on in the opposition the Commissioner can reconsider the information at the conclusion of the opposition, and re-examine the application if any amendments resulting from the opposition have not already addressed the issue. In other words, the new information needs to be significantly better than what is already in evidence. Where the new information is a new citation, it should be considered whether it is likely that the ground of lack of novelty or lack of inventive step in the light of the citation would be made out, and whether the ground would not otherwise have been made out.””
[27] [2015] APO 16 at [24]
WO ‘487 is directed to endophytes associated with perennial ryegrasses that appear to have a similar alkaloid profile and similar beneficial effects on the host grass. The information is this document is clearly relevant and essential to the present proceedings, and therefore I will rely on this document. I note that the patent office and both parties have had access to the document. The document (or patent family member documents from National Phase entry of the application) has been addressed in the evidence and in the written submissions. As such both parties have made representations about the document and I do not need to provide the parties a further opportunity to provide evidence or make representations about the document (as per regulation 5.23(2)).
The second matter concerns the request under regulation 5.23 filed on 23 November 2017 by AVS. This request sought to introduce an additional declaration by Dr Guthridge together with associated exhibits.
Regarding the introduction of evidence in the form of information contained in a statutory declaration the delegate in Reflex Instruments Asia Pacific Pty Ltd v Minnovare Limited[28](the Reflex decision) detailed an approach based on decisions of the Trade Marks Office relating to an equivalent provision provided under the Trade Marks Regulation 1995.
[28] [2017] APO 8
Whilst I acknowledge that the Reflex decision set out a number of relevant factors to consider, for the present purposes it is sufficient to consider the nature of the information and whether it is likely to change the outcome of the opposition in a significant way.
The request under regulation 5.23 filed on 23 November 2017 by AVS sought to introduce an additional declaration by Dr Guthridge together with associated exhibits. Dr Guthridge’s declaration addresses several points made in the evidence in reply, including comments by Dr Maclean, Dr Mace and Dr Card. The exhibits filed with the request under regulation 5.23 are published documents that exemplify bacterial and fungal strains which are characterised as distinct by a small number of SNP differences, as well as publications that demonstrate that published peer-reviewed literature contains instances of significant results with a p-value of greater than 0.5.
The information provided in Dr Guthridge’s second declaration does not clearly contest the evidence already on file, and it is not apparent to me that the evidence will assist me to resolve key questions with regard to the genotype and phenotype of the endophyte that I have considered below. I also note that, regarding the submissions made at the hearing, AVS did not place significant emphasis on the information provided in the second declaration of Dr Guthridge.
With regard to the information provided in the exhibits, the first set of published documents relate to differentiating bacterial and fungal strains based on SNP differences. It is not apparent to me that information relating to bacteria is relevant to the present consideration which examines whether two endophytic fungi are the same. Moreover, the evidence does not demonstrate that information gleaned from other fungal species may be extrapolated to fungi of the Epichloë/Neothyphodium genus, therefore I consider the information provided by these exhibits is speculative and unlikely to change the outcome of the opposition.
Similarly, with regard to the exhibits that demonstrate instances of significant results with a p-value of greater than 0.5, I consider this evidence does not clearly challenge the information provided by Dr Card, and is therefore unlikely to change the outcome of the opposition.
Accordingly, it is not apparent to me that any of the information sought to be introduced by AVS would be likely to change the outcome of the opposition in a significant way, and therefore I will not have regard to any of these documents under regulation 5.23.
Novelty
It is well established that the general test for anticipation is the reverse infringement test. The classic formulation of this test is that given by Aicken J:[29]
“The basic test for anticipation or want of novelty is the same as that for infringement and generally one can properly ask oneself whether the alleged anticipation would, if the patent were valid, constitute an infringement.”
[29] Meyers Taylor Pty Ltd v Vicarr Industries Ltd [1977] HCA 19; 137 CLR 228 at 235.
This test is satisfied if the alleged anticipation discloses all of the essential features of the invention as claimed.[30] To meet this requirement, the prior art must contain “clear and unmistakable directions to do what the patentee claims to have invented... A signpost, however clear, upon the road to the patentee's invention will not suffice. The prior inventor must be clearly shown to have planted his flag at the precise destination before the patentee.”[31]
[30] Nicaro Holdings Pty Ltd v Martin Engineering Co [1990] FCA 40 at[19].
[31] The General Tire & Rubber Company v The Firestone Tyre and Rubber Company Limited [1972] RPC 457 at 485-486
The opponent contends that the invention claimed in claim 1 insofar as it extends to the endophyte NEA12 has been anticipated by the disclosure of the AR37 endophyte in WO 2004/106487.
The priority date of the present application is not in dispute. WO 2004/106487 (WO’487) was published on 9 December 2004. This is before the priority date of the present application and therefore the document forms part of the prior art base.
With regard to the endophyte designated AR37, WO’487 discloses an isolated endophyte of Neotyphodium lolii (N. lolii) species, as exemplified by AR37 cultures deposited on 23 May 2003 at the Australian Government Analytical Laboratories (AGAL), with the accession number NM03/35819.[32] The document indicates that the endophyte was isolated from collections of seed of perennial ryegrass originally sourced from France.[33]
[32] WO ‘487 page 5 lines 12-17
[33] Ibid, page 11 lines 3-4
Analysis of the metabolite profile indicates that the endophyte does not produce lolitrem B, ergovaline or peramine.[34] Instead, it produces janthitrems.[35] Infection of the cultivar Grasslands Nui with AR37 is shown to result in beneficial outcomes including increased ryegrass yield and root mass[36], resistance to a range of insect pests[37] and a reduction in the incidence and severity of ryegrass staggers.[38]
[34] Ibid, page 12 line 23
[35] Ibid, page 14 lines 5-7
[36] Ibid, Table 5 and Table 7
[37] Ibid, page 24 lines 10-16
[38] Ibid, page 26 line 10 - page 27 line 11.
On this basis it is apparent that the AR37 endophyte has been isolated and has a desired genetic and metabolic profile. Therefore, the only outstanding question is whether the AR37 and NEA12 endophytes are the same endophyte strain. I note that this is question of fact, and the facts must be proved to a level of practical certainty.[39]
[39] Aspirating IP Limited v Vision Systems Limited, [2010] FCA 1061 at [35]; [2010] FCA 1061; 88 IPR 52
Regarding the question of whether two endophyte strains are the same species Professor Arnold indicates that:
“…any question regarding ‘the same species of endophyte’ is the challenge posed by species concepts in fungi. Fungal species can be difficult to define in some taxa for several reasons. Traditionally species were defined on the basis of morphology of reproductive structures. However, many endophytes remain sterile in culture (do not produce reproductive structures in culture, such as sexual structures), and thus lack diagnostic morphology. A similar issue arises when fungi cannot be induced to produce asexual reproductive structures in culture; these structures (asexual spores such as conidia, and the structures on which conidia are borne) also can be diagnostic to determine the identity of a fungal culture and can help distinguish members of the same vs. other species. Thus, fungi lacking such structures (sexual or asexual) cannot always be identified conclusively, and pose a major challenge for determining whether two strains belong to the same species. Even when such reproductive structures are present, convergent evolution or related issues can result in different species sharing the same structural characteristics, confusing the species designation. Some characteristics are plastic, that is, sensitive to environmental factors. These issues have prompted an increasing reliance on molecular analyses (primarily of DNA sequences) to try to determine fungal species boundaries. This is challenging in turn because not all loci (genetic markers) evolve at a rate appropriate for distinguishing species, and the evolutionary rate of such markers can differ among species; not all loci 'tell the same story' in a given fungus, if (for example) there has been horizontal gene transfer, such that some genes have a different evolutionary history than others in the same organism; not all molecular approaches are equally useful, with some (e.g., restriction length fragment polymorphism) providing less resolution than others (others such as phylogenetic analysis of taxon-appropriate genes/loci or whole-genome sequencing); conclusions are weakened when potential diversity within a group is undersampled: for example, one could have two strains, obtain DNA sequences from them, compare those sequences, and conclude that relative to all other known fungi, those two strains cluster together sufficiently to be considered members of the same species; yet when more variants in the same general group are analyzed, the differences between the strains might become more clear; many of the loci used to define species in fungi are non-coding markers, such as the internal transcribed spacers (ITS); these regions are useful because they evolve quickly, so that closely related organisms sometimes can be distinguished and grouped by fairly large numbers of mutations. However, they do not speak to functional traits of the fungi themselves, and there are known cases in which such sequences appear to suggest that two fungal strains are 'in the same species,' but these fungi differ markedly in their effects on plants or other ecological traits.
These issues, in general, were prevalent before 7 January 2010, and in many ways were not fully resolved at this time. Thus to understand whether 'two fungal strains, or two endophyte strains, are of the same species' requires careful work by a specialist, with thorough evaluation of molecular, morphological, and ecological data.”:[40]
[40] Arnold [44]-[45]
Further, she states that[41]
“Diverse methods have been used to observe endophytes in plants, to isolate them, and to characterize them taxonomically and functionally. Here I describe four main categories, all of which were in use at 7 January 2010, and are currently in use today: histological methods, microbiological methods, molecular methods and inoculation methods. Several of these were used to determine whether an isolated endophyte was newly isolated relative to previously known species (primarily microbiological and molecular methods, coupled with bioinformatics and phylogenetic analysis).”
[41] Ibid, [50]
As discussed by Professor Arnold and consistent with the approach taken in the present application and the citation, a range of microbiological and molecular methods can be used to characterise an endophyte strain. I will therefore consider whether the evidence can establish that AR37 and NEA12 are the same endophyte strain.
Analysis of endophyte genotype
Grasslanz relies on simple sequence repeat (SSR) genotyping to compare NEA12 and AR37.
“…SSRs, also called microsatellites, are tracts of DNA in which small segments are repeated a number of times one after the other. These areas are highly variable due to differences between individuals in the number of repeated segments within the tract. It is extremely unlikely that unrelated individuals would have the same genetic profile when assessed across a number of SSR loci or positions. Accordingly, SSRs and other repetitive sequences (also called ‘DNA markers’) can be used to determine the ‘genetic fingerprint’ of an individual and compare it with another individual.[42]”
[42] Faville #1, 4.2.1
Dr Faville performed SSR analysis with the NEA12 as deposited by AVS at the National Measurement Institute and the comparator endophyte strain AR37 isolated from the AgResearch parent plant collection, located in Mycology glasshouse #4 at the Palmerston North Campus[43].
[43] Ibid, 4.1.3
AVS questioned the provenance of the AR37 endophyte as the endophyte had not been obtained from the culture deposited with AGAL. I note that the WO ’487 document indicates that “…endophytes of this invention are held in seed stocks, a culture collection, or in cloned plants at the AgResearch Ltd site in Palmerston North, New Zealand. The cultures are also deposited at the Australian Government Analytical laboratories in Sydney, Australia.[44]” The AR37 comparator strain used in the SSR analysis was isolated from the AgResearch endophyte parent plant collection at the Palmerston North campus, one of the stated sources of the endophyte strain, therefore I am satisfied that the analysis performed compared NEA12 and the AR37 endophyte strain disclosed in WO ’487.
[44] WO ‘487 page 11 lines 11-14.
In total, SSR analysis was performed across 25 SSR loci, with the data showing that the PCR product sizes are identical for NEA12 and AR37 at all 25 loci[45]. Based on the complete correspondence of PCR product sizes between AR37 and NEA12, Dr Faville concluded that these strains are genetically identical.[46]
[45] Faville #1, 5.4, consistent with MJF-2 and MJF-3
[46] Ibid, 7.1
In contrast, AVS has undertaken genomic sequencing. Specifically, the DNA of AR37 and NEA12 were subject to genome survey sequencing using Illumina platform sequencing. DNA from NEA12 was also subject to Sequel platform sequencing.[47] The sequenced genomes of the two endophyte strains were then compared and single nucleotide polymorphisms (SNPs) were identified.[48] 36 SNPs were identified between AR37 and NEA12 using the parameters described by Dr Guthridge.[49] Further analysis established that 6 SNPs were of high confidence. Dr Guthridge noted that “the other 30 SNPs identified may be equally real, but with lower confidence.[50] She concluded that the SNP analysis “shows that in fact NEA12 is a different strain to AR37”.[51]
[47] Guthridge [25]
[48] Ibid, [27]-[28]
[49] Guthridge [27]-[29]
[50] Ibid, [29]
[51] Guthridge [50]
Clearly the parties have presented conflicting positions with regard to the genotype of the endophyte and whether, based on the analysis presented, the two endophyte strains are the same. The parties have also disputed aspects of each other’s evidence. I will consider these matters in the consideration below.
AVS noted that with regard to the SSR analysis of the B10 allele Dr Faville had observed differences in the allele size reported for AR37 compared to those disclosed in AU 2008200775 (AU patent equivalent to WO ‘487).[52] In his declaration Dr Faville has explained that the variation observed is not surprising and can be attributed to differences in the conditions and machines used for the analysis.[53] Professor Arnold has also confirmed that the reasoning provided by Dr Faville is consistent with the understanding in the field.[54] On this basis I am satisfied that the differences observed can be justified, and therefore I am satisfied that the AR37 and NEA12 B10 allele is comparable to that disclosed in WO ‘487.
[52] AWS at [27]
[53] Faville #1, 6.2-6.3
[54] Arnold [144]
Another matter in dispute between the parties is the merit of the genotype analysis performed, that is SSR analysis versus whole genome analysis. On this point, I consider the most significant evidence is provided by Professor Arnold. In her discussion of the state of the art and prior to viewing the present application Professor Arnold stated:
“SSR analysis if applied appropriately should be more sensitive to distinguish between species than ITSrDNA. However, that said, conceptually it is possible that, depending on the loci or the area of the genome that was evaluated using SSR, you could still have two genetically distinct fungi with the same SSR pattern. For example, if you were to look at the full genome or at gene expression or potentially at the phenotypic effects of the endophytes, two strains that appear identical by analysis of SSR could in fact be different.”[55]
[55] Ibid [66]
Further, in considering whole genome sequencing she stated:
“…for many people the gold standard to the level of species and strain identification would have been full genome sequence analysis.
How to use whole genome sequence analysis to differentiate between closely related endophyte strains was at 7 January 2010 and remains today a matter of some discussion amongst fungal biologists; however in general first of all what one would do at prior to [sic] 7 January 2010 would be to sequence the full genome of a number of related species, and where possible compare them using a phylogenomics approach – essentially this is a phylogenetic approach using the full genome data set or components of the genome data sets that distinguish between closely related species. I say “where possible” because computation limitations can make it quite difficult to do phylogenetic analyses, so alternatively one would simply look at the overall sequence of the two genomes and/or choose loci or homologous regions of the genomes and compare those in turn. An example would be looking for evidence of single nucleotide polymorphism (SNP) in areas around the genome that could provide the solution that would not necessarily be visible if you were restricting your analysis to a set of SSR type markers.
An (sic) SNP is a variation in single nucleotide in DNA sequences. Typically there will be some degree of natural variation, for example, within populations at a given position in the genome, so if you were to look at the population of fungi in the same species, you might expect some degree of variation at a given position. If you were then to step outside that natural variation, a greater frequency of variation can identify different endophyte strains.”[56]
[56] Ibid [67]-[69]
I consider that this evidence clearly establishes that SSR analysis can be sufficient to distinguish between two endophyte strains, but in certain circumstances it may be necessary to perform additional analysis. Alternate analysis may include whole genome sequence analysis, as discussed by Professor Arnold when asked what she would need to positively conclude whether two endophytes were the same:
“The gold standard for addressing this would be a genome sequence analysis and comparison. I would look in particular at overall genome size, the presence of genes encoding for particular alkaloids, the overall similarity or difference of the genome and the presence of SNPs. With that information and the totality of evidence from alkaloid profiles I would be able to assign with a degree of probability where or not two strains are the same. I would do this by sequencing the full genomes using, for example, the chemistry described in the specification and compare them by a computation series of comparisons.”[57]
[57] Ibid [128]
In the present circumstances it is apparent that whole genome analysis as performed by AVS has identified a number of differences between AR37 and NEA12.[58] However, it is not immediately discernible whether the SNPs identified by Dr Guthridge step outside the normal variation expected, and therefore could be considered indicative of a different endophyte strain.
[58] See [84] of this decision
As part of his evidence in reply Dr Maclean has challenged the methodology used by Dr Guthridge to identify SNPs. In particular, he identifies concerns with the lack of quality scores and quality mapping after the trimming step, which he suggests can lead to difficulties with the reliability of the SNPs called.[59] However, I note that Professor Arnold, the only independent expert, in commenting on the overall approach taken by Dr Guthridge is clearly of the view that the approach taken was robust.
“In my understanding of the knowledge in the field, the methods described in the Guthridge declaration are very robust methods that have been applied with an awareness of their potential failing, and those potential failings have been carefully addressed. I do not have any reason to doubt the approaches here and I would further note that the comparison of Illumina with PacBio is quite powerful; using two totally different platforms gives one a greater degree of certainty. If the same endophyte DNA is sequenced on two different platforms and the results are consistent, then one is less likely to be concerned with a sequencing error as an issue for any subsequent comparisons.”[60]
[59] Maclean [3.3.1]-[3.3.2]
[60] Arnold [156]
On this basis I am satisfied that the analysis performed gives a high degree of certainty with respect to the SNPs identified. However, a question still remains with respect to whether the SNPs characterised by Dr Guthridge step outside natural variation between isolates to identify a different endophyte strain.
In this regard, Dr Maclean has compared the genomes of two independent isolates from three different Epichloë strains, including AR37.[61] His analysis showed that at least 11 high confidence SNPs were found between the independent isolates for all three strains examined. Table 1 below depicts the results from Dr Maclean’s analysis.
[61] Maclean [4.2]-[4.6]
Table 1 – Analysis of genome comparisons between isolates of different Epichloë strains
Reference Genome (Isolate 1) Comparison Genome (Isolate 2) # SNPs identified between isolate 1 and 2 AR37 AR37 37 FL1 >20,000 FL1 FL1 11 AR5 AR5 22
Dr Maclean states that:
“The results show that isolates derived from the same strain have SNPs between them, and indeed had a greater number of SNPs (at least 11) than the 6 SNPs Dr Guthridge has found between NEA12 and AR37.”[62]
[62] Ibid [4.6]
However, Dr Guthridge has identified 36 SNPs between AR37 and NEA12, of which 6 are of high confidence. She indicates that the remaining 30 SNPs “may be as equally real, but with lower confidence”.[63] While this may prima facie be considered comparable to the 37 SNPs identified between the two isolates of AR37, it is not clear to me that the analysis Dr Maclean has performed is directly comparable to the analysis provided by Dr Guthridge. There are clearly differences in their methodologies and the tools they have used. Furthermore, as noted by Professor Arnold, the location of the SNPs within the genome can influence fungal traits, and accordingly the assessment of whether two fungi are in the same species.[64] The analysis performed by each party has not gone to the level where the location of the SNPs within the genome is determined, therefore I consider that I cannot resolve to a level of practical certainty whether the AR37 and NEA12 have an identical genotype.
[63] Guthridge [29]
[64] Arnold [69]
I also note that Professor Arnold has stated that to resolve whether two strains are the same
“the gold standard for addressing this would be a genome sequence analysis and comparison. I would look in particular at overall genome size, the presence of particular genes encoding for particular alkaloids, the overall similarity or difference of the genome and the presence of SNPs. With that information and the totality of evidence from alkaloid profiles I would be able to assign with a degree of probability whether or not two strains are the same.”[65]
[65] Arnold [128]
With regard to the characteristics Professor Arnold has indicated she would consider to determine whether two strains are the same, evidence has only been provided for the alkaloid profiles of the plant-endophyte symbioses as discussed below.
Analysis of endophyte phenotype
As discussed earlier[66], Example 3 of the present application describes the characterisation of a range of endophytes, including NEA12. With regard to phenotypic analysis, the example describes analysis of the toxin profile and antifungal bioassays.
[66] See [38] of this decision
In their evidence, AVS has analysed the alkaloid production to compare the phenotype of AR37 and NEA12 associated with different perennial ryegrass cultivars. Perennial ryegrass-endophyte symbiota for the Trojan, Bronsyn, Bealey and Alto cultivars were analysed for janthitrem production.[67] Table 2 below details the treatment and Table 3 specifies janthitrem 1 production.[68]
[67] Guthridge [34]-[38]
[68] Ibid, Tables 1 and 2
Table 2. Ryegrass-endophyte symbioses assessed for janthitrem production
Endophyte (# of samples) AR37 NEA12 Cultivar Trojan 26 6 Bronsyn 24 23 Bealey 27 6 Alto 22 16
Table 3. Janthitrem 1 production by different cultivar-endophyte symbioses.
AR37* NEA12* t-test (P-value) Cultivar Trojan 6.61 6.47 0.350 Bronsyn 6.47 6.60 0.234 Bealey 6.55 6.29 0.058 Alto 6.39 6.56 0.132 *Data represented as transformed ion intensity (log10)
100. The evidence shows that janthitrem production varied between cultivar-endophyte symbioses. Statistical analysis using ANOVA indicated that janthitrem 1 levels were significantly different between cultivar-endophyte symbioses (P-value 0.069).[69] In addition, as shown in Table 2 above, statistical analysis using t-tests for each pairwise combination indicated that janthitrem 1 levels were significantly higher (P=0.058) in Bealey-AR37 than Bealey-NEA12.[70]
[69] Ibid [40]
[70] Ibid [41]
101. Grasslanz submitted that deficiencies in Dr Guthridge’s evidence necessitate the rejection of her phenotypic analysis based on janthitrem production because the conclusions drawn are not consistent with the results obtained from the analysis.[71]In particular, Dr Card questioned the reliability of the statistical analysis performed due to differences in the number of replicates (samples) used to compare janthitrem production (see Table 1 above).[72] He also disputed the conclusion given by Dr Guthridge based on janthitrem 1 production:
[71] Card [3.1]
[72] Ibid [3.7]
“In paragraph 41 Dr Guthridge summarises the results of the alkaloid analysis. She refers to ‘P values’. P-values are part of a hypothesis test and are used to determine statistical significance by measuring how compatible your data are with the null hypothesis. A high p-value suggests that the result is not statistically significant. A low p-value suggests that the null hypothesis can be rejected and that a significant difference does exist. However, p-values address only one question: how likely is the effect observed in your data, assuming the null hypothesis is true. Or, in this case, how likely it is that AR37 and NEA12 are different based on the difference seen in the data. P-values do not measure support for the alternative hypothesis. P-values <0.05 are considered statistically significant (with smaller values providing stronger evidence for significance), and p-values ≥ 0.05 and <0.1 are considered a trend implying need for further research.
Dr Guthridge infers that the observed difference in janthitrem levels between Bealey-AR37 and Bealey-NEA12 is statistically significant, pointing to a p-value of 0.058 for this cultivar. However, in my opinion the results obtained by Dr Guthridge are not statistically significant, and do not support a conclusion that NEA12 and AR37 are different, distinct endophyte strains…A p-value of 0.058, while it may appear to hint at a statistically significant difference between the results…is not within the significance level of 5% typically used in scientific research internationally. This value is considered a trend but is not conclusive and implies the need for further research.”[73]
[73] Ibid [3.9]-[3.10]
102. Grasslanz has provided evidence on this point by way of the analysis by Dr Mace of janthitrem I from AR37 and NEA12. While this analysis shows that in the host cultivar inoculated AR37 and NEA12 cannot be differentiated, the evidence does not identify the host cultivar used in the analysis. This is of concern to me because the evidence presented by Dr Guthridge indicates that janthitrem production varied between cultivar-endophyte symbioses.[74] In particular, it is the Bealey-endophyte symbiosis that reveals a difference in janthitrem production between AR37 and NEA12.
[74] See for example, Table 3 above and [100] of this decision
103. Even Dr Mace (the opponent’s expert witness) states that:
“The level of endophyte alkaloid detected in the host grass plant is dependent on the species and cultivar of the host plant, as well as environmental factors such as temperature, water and nutrient availability, and time of year. For this reason, a comparison between the levels of alkaloids produced by two endophytes is difficult to achieve and requires careful experimental design.”[75]
[75] Mace [4.4]
104. Thus, in my opinion, to counter the trend identified by AVS that implies that there is a difference in janthitrem production in the Bealey cultivar, Grasslanz would need to provide additional analysis of janthitrem production in the Bealey cultivar. As they have not provided such analysis, their evidence submitting janthitrem production is the same is not conclusive. Accordingly, I cannot be satisfied to the level of practical certainty that janthitrem production is the same in AR37 and NEA12.
105. It follows then that on the evidence before me I cannot find that AR37 and NEA12 are the same endophyte strain. I cannot resolve that the two strains have the same genotype, nor the same phenotype since the views of the AVS experts cannot be rejected on proper grounds. Therefore Grasslanz has not established to the level of practical certainty that claim 1 lacks novelty in view of WO ‘487.
106. As noted earlier, claim 2-7 each ultimately depend on claim 1, and therefore for the same reasons as discussed above Grasslanz has not established that these claims lack novelty in view of WO ‘487
Inventive step
107. In their SG&P and written submissions Grasslanz asserted that to the extent that the claims of the opposed application cover known endophytes, the features added by claims 2-6 are not inventive.
108. In the novelty consideration above I have decided that Grasslanz has not established that the present claims cover a known endophyte. It therefore follows that the principal proposition put forward by Grasslanz as the basis of their inventive step argument has not been established.
109. Furthermore, at the hearing Grasslanz stated that their primary position was that the features added by claims 2-6 are either inherent features of endophyte or are disclosed in WO ‘487. That is the central argument was one of novelty not inventive step. AVS did not dispute this point.
110. On this basis, Grasslanz submitted at the hearing that inventive step is not a live issue. I agree, and I will not consider it further in this decision since there were no significant submissions made on this ground. Grasslanz has not established that the present claims lack an inventive step.
Conclusion
111. I find that the opposition was unsuccessful on all grounds.
Costs
112. The parties did not make submissions regarding costs at the substantive hearing as the outcome of the proposed amendment to the SG&P and consideration of the additional evidence filed by the Applicant under Regulation 5.23 had the potential to influence their final submissions on the matter. I therefore allow the parties 1 month from the date of this decision to provide written submissions in relation to costs.
Sophina Calanni
Delegate of the Commissioner of Patents
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