iGas Operations Pty Ltd v Pipe Ex Pty Ltd
[2025] APO 27
•11 August 2025
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
iGas Operations Pty Ltd v Pipe Ex Pty Ltd
Pipe Ex Pty Ltd v Intelligas Technology Developments Pty Ltd
[2025] APO 27
Patent Application: 2023201549 (s59) & 2021377198 (s36)
Title:Devices to prevent loss of liquid on high point vents & High-point vent system
Section 59 Opposition
Patent Applicant: Pipe Ex Pty Ltd
Opponent: iGas Operations Pty Ltd
Section 36 request
Patent Applicant Intelligas Technology Developments Pty Ltd
Requestor Pipe Ex Pty Ltd
Delegate: Andrew Burgess
Decision Date: 11 August 2025
Hearing Date: 9 April 2025
Catchwords: PATENTS – opposition to the grant of the patent under s 59(a)(i) and 59(a)(ii) – entitlement – identification of inventive concept – date of conception – employment agreement and duty to invent – effect of resignation and notice period – opposition successful – opportunity to amend – operation of s 33 – costs awarded
Request under s 36 – seeking declaration that nominated person not an eligible person – identification of inventive concept – date of conception – employment agreement and duty to invent – request unsuccessful – costs awarded
Representation: Counsel for Pipe Ex Pty Ltd: Mr Joseph Elks
Patent attorney for Pipe Ex Pty Ltd: Dr Andy Mukherji and Dr Vanessa Yeung of MBIP
Patent attorney for the iGas & Intelligas: Katrina Crooks and Nadine Martino of Spruson & Ferguson
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2023201549 & 2021377198
Title:Devices to prevent loss of liquid on high point vents & High-point vent system
Patent Applicants: Pipe Ex Pty Ltd & Intelligas Technology Developments Pty Ltd
Date of Decision: 11 August 2025
DECISION
I am not satisfied that Pipe Ex Pty Ltd is an eligible person in respect of AU2021377198, and therefore, the S36 request is unsuccessful.
I am satisfied that Pipe Ex Pty Ltd is not an eligible person in respect of AU2023201549. Therefore, the S59 opposition is successful.
I allow two (2) months from the date of this decision for Pipe Ex Pty Ltd to amend the AU2023201549 application to attempt to overcome the grounds of opposition.
In the matter of the request under section 36 of the Act in respect of application 2021377198, I award costs according to schedule 8 against the requestor, Pipe Ex Pty Ltd.
In the matter of the opposition under section 59 of the Act to the grant of a patent on application 2023201549, I award costs according to schedule 8 against the applicant, Pipe Ex Pty Ltd.
REASONS FOR DECISION
Background
Patent application AU2021377198 (AU198 application) was filed by Intelligas Technology Developments Pty on 11 November 2021 under the provisions of the Patent Cooperation Treaty as PCT/AU2021/051337, first published as WO2022/099368 A1. The AU198 application claims priority from provisional application AU2020904128 filed on 11 November 2020.
On 28 June 2024, Pipe Ex Pty Ltd filed an application under Section 36 requesting the Commissioner to declare that Pipe Ex Pty Ltd is an eligible person alone or, in the alternative, in conjunction with Intelligas Technology Developments Pty in respect of AU198.
Patent application 2023201549 (AU549 application) was filed by Pipe Ex Pty Ltd on 14 March 2023, claiming priority from provisional application 2022901025 filed on 18 April 2022. Acceptance of the AU549 application was advertised on 15 June 2023. On 15 August 2023, iGas Operations Pty Ltd filed a Notice of Opposition under Section 59 against the grant of a patent for AU549. On the same day, Phoenix Energy Services also filed a Notice of Opposition, however Phoenix Energy Services withdrew their opposition before proceeding any further.
On 15 December 2023, iGas Operations Pty Ltd filed their Statement of Grounds and Particulars (SGP). On 19 September 2024 iGas Operations Pty Ltd filed a first amendment to the SGP, which was allowed on 8 October 2024.
The amended SGP sets out the following grounds of opposition:
1. Section 59(a)(i) – Nominated person not entitled to grant of a patent for the invention, and
2. Section 59(a)(ii) – Nominated person only entitled to grant of a patent for the invention in conjunction with some other person.
As will be discussed more below, Intelligas Technology Developments Pty and iGas Operations Pty Ltd are related corporate entities, and it will generally be convenient to refer to them collectively as iGas, except where necessary to distinguish between them. For reasons which will become clear, it will be necessary later in this decision to be more careful with the nomenclature for Pipe Ex Pty Ltd. I will refer to the entity which is the requestor for AU198 and applicant for AU549 as Pipe Ex Pty Ltd.
Applicable Law and the Standard of Proof
Both applications were made after 15 April 2013, and so are governed by the Patents Act 1990 (the Act) as amended by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012. The standard of proof that applies to both matters is therefore the balance of probabilities.
Regarding AU198, the onus of proof for the purposes of s36 typically initially falls on the requestor (Pipe Ex Pty Ltd), see Woodside Energy Limited v Richard John Moore[1] at [37]. However, the evidentiary burden may shift under some circumstances, especially when knowledge of relevant facts lies primarily with one party or the other; see Dunlop Holdings Limited's Application[2] at 542 to 544.
[1] [2018] APO 82.
[2] [1979] RPC 523.
Regarding AU549, if I am satisfied, on the balance of probabilities, that a ground of opposition to the grant of the standard patent exists, I may refuse the application. However, under section 60(3B), I must not refuse the application without, where appropriate, allowing the applicant (Pipe Ex Pty Ltd) a reasonable opportunity to amend the application to overcome the ground(s). The opponent (iGas) bears the onus.
Evidence
Regarding AU549, on 15 March 2024, iGas filed their Evidence in Support, which comprised a declaration from Derek Fekete (Fekete#1) with annexures DF-1 to DF-19, and a declaration from Andrew Clarkson (Clarkson#1) with annexures AC-1 to AC-5. On 17 June 2024, Pipe Ex Pty Ltd filed their Evidence in Answer, which comprised a declaration from Steven Larsen (Larsen#1), and a declaration from David Nichols (Nichols#1) with annexures DN-1 to DN-14. On 19 August 2024, iGas filed their Evidence in Reply, which comprised a second declaration from Mr Clarkson (Clarkson#2), a declaration from Bryan Fulwood (Fulwood#1), and a second declaration from Derek Fekete (Fekete#2) with annexures DF-20 to DF-23.
Regarding AU198, on 21 October 2024, Pipe Ex Pty Ltd filed their Evidence in Support, which comprised a declaration from Mr Nichols (Nichols#2) and annexures DN-1 to DN-16. On 20 December2024, iGas filed their Evidence in Answer, which comprised a declaration from Mr Fekete (Fekete#3) with annexures DF-1 to DF-18 (noting that DF-1 of this declaration comprises DF-1 to DF-23 from Fekete#1 and Fekete#2, and DF-2 comprises AC-1 to AC-5 of Clarkson#1). On 20 January 2025, Pipe Ex Pty Ltd filed their Evidence in Reply, which comprised a declaration from Mr Nichols (Nichols#3).
On 7 April 2025, Pipe Ex Pty Ltd requested for the Commissioner to invoke Reg. 5.23 to admit two new documents (collectively, the 5.23 material). While Reg. 5.23 does not formally apply to S36 matters, it is the Commissioners practice to apply similar principles. The first of these documents was an assignment of IP rights from David Nichols to Pipe Ex Pty Ltd dated 1 April 2019 (the 2019 assignment), and the second is an assignment of IP from David Nichols to Pipe Ex Pty Ltd dated 20 April 2022 (the 2022 assignment). On 7 May 2025 I partially allowed the request by admitting the 2019 assignment into evidence in respect of the AU198 matter, and I allowed Intelligas Technology Developments Pty to submit responding material, which they did on 7 July 2025 (the 5.23 response).
Declarants
Mr Nichols is the named inventor for both applications. He is the founder and Executive Director of Pipe Ex Pty Ltd[3], and was Chief Operating Officer of iGas Operations Pty Ltd from October 2019 until March 2022. He is a mechanical and civil engineer who has been working in the oil and gas sectors since 1989, and in Australia specifically since 2011[4], and as will be discussed more below, he has expertise in the fields of high point vents and related technologies. In 2013, he founded “Independent Pipeline Services”, which would later become “iPipe”, where he developed new machines, isolation devices, and tools for use in the coal seam gas industry.
[3] Nichols#1 at 1; Nichols#2 at 1.
[4] Nichols#1 at 4; Nichols#2 at 4.
Mr Fekete is the chief executive officer (CEO) of IntelliGas Group Limited, of which relevantly includes Intelligas Technology Developments Pty Ltd and iGas Operations Pty Ltd[5]. He obtained a Bachelor’s degree of Engineering from the University of Queensland in 1991, then worked with Energy Developments Group for 15 years working on projects related to landfill gas, coal seam methane, CNG/LNG virtual pipelines, remote area combined cycle power, and waste to energy fields, contributing to design, commissioning, operations, and business development. He obtained a Masters of Business Administration from Griffith University in 2009, and went on to found IntelliGas Group Limited in 2017[6].
[5] Fekete#1 at 1, 4; Fekete#3 at 1, 4.
[6] Fekete#1 at 1-7; Fekete#3 at 1-9.
Mr Clarkson is currently a Non-Executive Director of Phoenix Energy Services Pty Ltd[7]. He obtained a Bachelor’s degree of Engineering from Northumbria University in 1996, and has worked in a range of engineering roles in the gas production and pipeline industry[8]. Mr Clarkson was previously employed by iGas Operations Pty Ltd as Engineering Manager from July 2020 until March 2022[9]. Mr Clarkson describes that, after leaving iGas, he joined forces with Mr Nichols and two other colleagues to form Phoenix Energy Services[10]. However, it appears Mr Nichols and Mr Clarkson would later fall into dispute over Mr Nichols becoming a shareholder and a putative licensing agreement with respect to AU549[11].
[7] Clarkson#1 at 1.
[8] Clarkson#1 at 1 and 4.
[9] Clarkson#1 at 3.
[10] Clarkson at 2 and 27.
[11] Clarkson#1 at 29-30.
Mr Larsen has been working on pipeline, mining, construction, and infrastructure projects since 2000, in roles including estimator, procurement manager, and 3D designer[12]. He was employed as a 3D designer at iPipe (Mr Nichols’ previous company) from 2013 until 2019, when he then joined iGas as a workshop assistant working on compressor packages[13].
[12] Larsen#1 at 1-2.
[13] Larsen#1 at 3-7, noting that Mr Larsen refers to the company as “IntelliGas Pty Ltd”.
Mr Fulwood has been the Manufacturing Manager at iGas since approximately 2015[14].
[14] Fulwood#1 at 1.
Mr Larsen and Mr Fulwood have largely only provided declarations about conversations and general context about the work conducted at iGas, while Mr Nichols, Mr Fekete, and Mr Clarkson have provided more detailed submissions about the specific products developed and various business arrangements.
None of the declarants can be said to be truly unbiased, but that is not unusual where there are disputes over entitlement. Indeed, the individuals in dispute may often be the only people privy to the relevant facts. By my estimate, none of the declarants have behaved in such a way that I would discount their declarations as a whole, but I will need to bear in mind their respective interests when weighing up their declarations.
Summary of the AU198 application
AU198 relates to the field of high-point vent systems (HPV) for gas and liquid pipe networks, particularly in the context of coal seam gas gathering systems[15]. HPVs (as the name suggests) are located at local high points along the length of a water pipeline, and involve a valve configured to release air or gas that accumulates at the high point. If this accumulated gas is not released, it forms a pocket which reduces or even fully stops the flow of water through the pipe[16]. In coal seam gas applications, the water in question is often considered an environmental pollutant, so it is important for the HPV to release gas but not water[17].
[15] AU198 specification at [0001]-[0002].
[16] AU198 specification at [0003].
[17] AU198 specification at [0005].
The specification identifies several problems associated with existing HPV systems, with Fig. 1 provided as an example of typical prior art HPVs (reproduced below). These existing HPVs comprise a housing 105, an inlet “Y” strainer 125, a vent outlet 120, and a vent valve 115 actuated by a float mechanism 110. While the specification does not describe the operation of the existing HPV in depth, from the figures and the general description provided it is clear to me that the inlet side of the Y strainer 125 is connected by a suitable pipe riser to the high point of the water line. Accumulated gas and/or water rises through the strainer 125 and into the housing 105. Gas is free to pass through the vent valve 115 and vent 120 up until the water level rises high enough to cause the float to close the valve 115. The vent will re-open whenever accumulated gasses displace sufficient water to allow the float to drop.
The problems identified include, firstly, that coal fines, clay deposits, and construction debris can block fine passages of the vent, or cause undesired release of water[18]. Secondly, the existing vents are typically made from steel which can be significantly corroded by the highly saline water. Additionally, it is stated that the existing vents experience a “loss of function at angles significantly away from the vertical”, as well as difficult and expensive maintenance, and difficulty cleaning the Y strainer[19].
[18] AU198 specification at [0004]. Note the specification refers to these as one problem, but to me the reference to “blockages” and “loss of containment” implies two failure modes – the vent being blocked closed, and the vent being blocked from closing.
[19] AU198 specification at [0038].
The specification then includes a number of consistory clauses[20] substantially matching the claims.
[20] AU198 specification [0008]-[0027].
The general operation of the preferred embodiment can be described by reference to Figure 3, reproduced below. The HPV system 200 comprises a cylindrical housing 205 defining a central cavity 300. The housing 205 is made up of an upper section 327 and lower section 328, with an inlet at the lower end of the lower section 328 and an outlet at the upper end of the upper section 327. A cylindrical, longitudinal basket filter 305 is fixed in the cavity 300 extending into the lower section 328. A float element 310 is located above and inside the filter 305, with an upper end of the float connected to a float rod 315. Above the upper section 327, there is a manifold 330 and check valve subsystem 335. The upper section 327 is removably bolted to the lower section 328 via lugs 320 and bolts 325 to allow for easy separation, giving access to the float 310 and filter 305 for cleaning and maintenance[21].
[21] AU198 specification at [0051].
In use, the operation of this portion of the HPV is similar to the prior art HPV: gas rises freely from the high point of the pipeline into the HPV, until liquid rises to lift the float and close a valve[22] (within the manifold 330, I will describe more below). One notable difference is that instead of utilising a Y strainer below the inlet to the chamber, there is a basket filter 305 inside the chamber and surrounding the float. This basket filter 305 preferably comprises a thin layer of “polymer or non-corrosive metallic mesh material”[23] (in this context, this is presumably supposed to mean polymer or corrosion resistant metal). After liquid passes through the filter 305, it rises into the upper section 327, which forms a settling chamber[24].
[22] AU198 specification at [0053].
[23] AU198 specification at [0049].
[24] AU198 specification at [0051].
Above the upper section 327, there is a manifold 330 and check valve subsystem 335, shown in more detail in Fig. 4 (reproduced below). The manifold is coupled to the outlet of the upper section 327 by threaded connection 425. The float rod 315 extends through the threaded connection 425, leaving an annular gap 400. The top of the float rod 315 is connected to an extension 410, and the top of the extension 410 includes a rubber-like seal 415. The manifold chamber includes a small central orifice 420.
The check valve subsystem 335 is located above the manifold 330. It comprises a lower check ball valve and an upper check ball valve. Lower check ball valve 440 initially seals against lower seat 445 to prevent external gas from flowing into the system and can rise under gas pressure within orifice 420 to allow accumulated gasses to rise towards the upper ball valve 450[25]. Upper ball valve 450 is initially in the open position allowing gas to pass from the lower ball valve out vent 455, but in the event rubber-like seal 415 fails and water reaches the upper check ball valve, the ball 450 floats upward to seal on seat 460, thereby closing the vent 455[26].
[25] AU198 specification at [0058].
[26] AU198 specification at [0059].
The two ball valves are separated from one another by “element” 465, with upper and lower surfaces for receiving the respective balls. The specification notes that the element 465 “integrates flow passages that direct flow annularly around the check ball 450 such that the check ball 450 is not lifted by the gas flow. The ball 450 is thus only lifted by floating in a liquid, should the chamber in which it resides fill with water.”[27]
[27] AU198 specification at [0060].
In operation, gas passes through the annular space 400 and then through orifice 420, until the float rises, lifting the float rod, extension, and rubber-like seal, pressing the seal against the orifice to form the primary vent valve.
The specification describes that by making the central orifice small, such as below 3mm diameter, the effect of any vacuum pressure in orifice 420 is reduced, which reduces the chance of the rubber-like seal becoming stuck in the closed position. This is said to increase the reliability of the operation when the HPV is inclined[28].
[28] AU198 specification at [0056].
Fig. 2 describes a reverse flush subsystem (reproduced below). This involves three valves attached to the HPV: valve 225 is tapped to the side of the inlet end of the lower section 328, valve 230 is tapped to the side of the lower section 328, and valve 235 is tapped to a point above the outlet end of upper segment 327 but below the valve/seal 415. An external, high pressure water source may be connected to valve 230 to wash down the outside of the filter, or to 235 to flush backwards through the filter, in either case using valve 225 as a pressurised exit port or discharging the water and debris[29].
[29] AU198 specification at [0061]-[0062].
Fig. 5-7 relate to a second embodiment of the invention. This second embodiment is similar to the first, except the upper section 327 and check valve subsystem 335 are not included.
The specification identifies that the invention provides a number of advantages, including robust operation resistant to corrosion[30], redundant sealing features to ensure saline solution does not escape[31], capable of operating at inclined angles[32], and efficient or improved flushing, cleaning, and maintenance[33]. However, the specification notes that not all advantages are associated with all embodiments[34].
[30] AU198 specification at [0040].
[31] AU198 specification at [0041].
[32] AU198 specification at [0042].
[33] AU198 specification at [0043]-[0044].
[34] AU198 specification at [0045].
AU198 ends with 20 claims, all directly or indirectly appended to claim 1. A full set of claims is included in the annex, but it will suffice to set out claim 1:
A high-point vent system, comprising:
a housing defining a central cavity;
a filter that extends across the central cavity;
a float positioned in the central cavity;
a float rod having a lower end and an upper end, the lower end of the float rod connected to the float and the upper end of the float rod connected to a seal; and
a manifold connected to the housing and having an input end and an output end, wherein the input end defines a seal orifice that is positioned adjacent to the seal.
Summary of the AU549 application
AU549 relates to the field of HPV systems, particularly but not exclusively in coal seam gas (CSG) applications[35]. The specification describes that in CSG gathering systems, high density polyethylene (HDPE) pipes are used to carry gas and liquid extracted from multiple wells, with the gas separated from the liquid either “down hole” or at the surface, which is then distributed through a network of pipes, risers, and manifolds leading to a compression station for the gas and a liquid pond or treatment plant for the liquid[36]. The specification states these networks have problems associated with “plugging”, where liquid cannot pass through the pipeline due to gas locking at high points in the pipeline. To reduce or avoid plugging, HPVs are used to remove gas pockets at high points[37]. The specification states that CSG often has issues with HPV failures, in particular failed seals, which cause liquid to be released, causing environmental pollution[38].
[35] AU549 specification at [001].
[36] AU549 specification at [003].
[37] AU549 specification at [004].
[38] AU549 specification at [005].
The specification describes the prior art HPVs with reference to Fig. 1, reproduced below. They comprise a housing 105, with a lower inlet 115 and an upper vent 125, and a side drain port 130. Inside the housing 105 is a float 110, which actuates a vent valve 120. The specification states that these existing systems suffer from corrosion of the metallic parts, fouling or blocking of the vent valve, and “a loss of function the vertical”[39]. This is said to lead to “a need for a device to stop the flow of liquid should the High Point Vent mechanism fail open.”[40]
[39] AU549 specification at [006].
[40] AU549 specification at [007].
The specification then includes a number of consistory clauses[41] substantially matching the claims.
[41] AU549 specification [0008]-[0025].
The general operation of the first embodiment may be describe by reference to Fig. 6, reproduced below. HPV valve assembly 600 comprises an upper compartment housing 200 and a lower compartment housing 300 separated by a diffuser plate assembly 500. As a note on terminology, while the specification refers to the two portions as separate housings, in fact the walls of the lower compartment and part of the upper compartment are integrally formed as a single part (Fig. 3), with the remainder of the upper compartment formed of a second part (Fig. 2). The first and second parts are coupled by threaded portions 215, 230. The lower compartment housing 300 includes an inlet orifice 310 at the bottom, and the upper compartment housing 200 includes an outlet orifice 205 at the top. The diffuser plate assembly (shown in additional detail in Fig. 5a) comprises a disc-shaped member 505, which is divided into a radially inner solid portion 502, and a radially outer/peripheral region which has through holes 510. The through holes 510 are not equally spaced around the radially outer portion, instead the holes 510 are confined to a first arcuate section[42].
[42] AU549 specification at [0031], Fig. 7-8.
Within the upper compartment housing 200, there is a filter assembly 400 (shown in more detail in Fig. 4) consisting of a cylindrical structure 402 which extends from the upper surface of the diffuser plate assembly 500 to the top inner surface of the upper compartment housing. The cylindrical structure 402 is sized and sealed to the diffuser plate such that the radially inner solid portion of the diffuser disk 502 aligns with the inside of the cylindrical structure 402, while the radially outer region (and hence all the through holes 510) align outside of the cylindrical structure 402. The cylindrical structure 402 includes screening perforations 405 in an upper section, with a lower section generally solid (although see discussion of drain hole 415 below). The lower section of the cylindrical structure 402 and the radially inner solid portion of the diffuser plate assembly 500 create a collection chamber, which collects liquid during use[43].
[43] AU549 specification at [0032].
Inside the lower compartment housing 300 is a lower sealing ball 535, which seals against converging walls around the inlet 310 to prevent ingress of air during vacuum conditions[44]. Inside the collection chamber, there is an upper sealing ball 420, which floats when liquid is collected within the collection chamber. When the liquid reaches high enough, upper sealing ball 535 engages a seating portion 210 surrounding outlet orifice 205, thereby sealing the outlet orifice to prevent release of liquid[45].
[44] AU549 specification at [0034].
[45] AU549 specification at [0033].
With all the main components in mind, the general operation of the HPV is this: gas accumulating in the pipeline at the high point enters the HPV via inlet orifice 310. This pressurised gas raises the lower sealing ball 535 and passes into the lower compartment 300. From there, the gas passes through the diffuser plate assembly 500 via through holes 510, entering an annular space between the upper housing 200 and the filter assembly 400. The gas passes through screening perforations 405, which screens any solid particles. The gas can then flow out outlet orifice 205. When liquid rises into the HPV, it initially follows the same path as the gas, until reaching the screening apertures 405. The liquid then begins to collect in the collecting chamber and floats the upper sealing ball 420, until the upper sealing ball seals the outlet orifice 205. At this point the pressure throughout the HPV equalises, allowing the lower sealing ball 535 to drop to the closed position. The specification notes that when this happens, the internal volume of the housing becomes pressurised, which can be released by means of a pressure relief valve 325[46]. A pressure monitoring device 610 may be provided to measure pressure levels within the housing.
[46] AU549 specification at [0036].
To allow liquid to drain from the collection chamber, the filter assembly includes a drain hole 415. Confusingly, the drawings show this drain hole 415 as being located on a lower portion of the cylindrical structure 402, leading from the collection chamber to the annular space, i.e., the upper housing 200. However, the specification describes that drain hole 415 is provided in the inner solid portion of the diffuser plate assembly 500, to drain fluid into the lower housing cavity[47]. The specification goes on to note that it is preferable that the drain hole in the lower section of the cylindrical section is positioned adjacent the second arcuate portion of the diffuser plate assembly 500[48] (that is, the portion without through holes). This alignment prevents air from entering the drain hole 415, which would cause the upper sealing ball 420 to spin or prematurely rise to seal outlet 205[49].
[47] AU549 specification at [0035].
[48] AU549 specification at [0035].
[49] AU549 specification at [0035].
The specification states that the advantages of the invention include: any solid particles in the liquid gas mixture are screened by the filter assembly 400 and may then accumulate within the annular space, and that the threadable engagement between the upper section and lower section allow for easy access and removal of the filter for cleaning[50].
[50] AU549 specification at [0037].
AU549 ends in 18 claims, all appended (directly or indirectly) to claim 1. A full set of claims is included in the annex, but it will suffice to set out claim 1:
A vent valve assembly for use in venting excess gas or gas pressure, the vent valve assembly comprising:
a housing defining a hollow central cavity with an in-use upper compartment separated from an in-use lower compartment by a diffuser plate;
the lower compartment having an inlet orifice for receiving influent flow of fluid and the upper compartment comprising an outlet orifice for expulsion of the fluid;
the diffuser plate being provided for allowing upward flow of fluid from the lower compartment to the upper compartment through the diffuser plate;
an upper sealing ball retained in the upper compartment and prevented from passing through the diffuser plate into the lower compartment,
wherein the upper sealing ball is movably disposed to move towards the outlet orifice and form a seal at or adjacent the outlet orifice to prevent expulsion of fluid through the outlet orifice;
wherein the in-use upper compartment further comprises a filter having a hollow structure with upstanding walls extending between a lower open end and an upper open end of the hollow structure wherein the upstanding walls comprise perforations for screening fluid and preventing solid particles from being received into an internal volume of the hollow structure;[sic]
Legal principles of entitlement
Section 59 of the Act relevantly states:
The Minister or any other person may, in accordance with the regulations, oppose the grant of a standard patent on one or more of the following grounds, but on no other ground:
(a) that the nominated person is either:
(i) not entitled to a grant of a patent for the invention; or
(ii) entitled to a grant of a patent for the invention but only in conjunction with some other person;In terms of who is entitled to a grant of a patent, Section 15(1) provides that:
Subject to this Act, a patent for an invention may only be granted to a person who:
(a) is the inventor; or
(b) would, on the grant of a patent for the invention, be entitled to have the patent assigned to the person; or
(c) derives title to the invention from the inventor or a person mentioned in paragraph (b); or
(d) is the legal representative of a deceased person mentioned in paragraph (a), (b) or (c).
This is understood to mean that a patent may only be granted to the inventor or somebody claiming through the inventor[51].
[51] Commissioner of Patents v Thaler [2022] FCAFC 62; 289 FCR 45 at [107], see also Stack v Davies Shephard Pty Ltd [2001] FCA 501; 108 FCR 422 at [21].
Section 36(1) of the Act relevantly states:
If:
(a) a patent application has been made and, in the case of a complete application, the patent has not been granted; and
(b) an application for a declaration by the Commissioner is made by one or more persons (the section 36 applicants) in accordance with the regulations; and
(c) the Commissioner is satisfied on the balance of probabilities, in relation to an invention disclosed in the specification filed in relation to the application for the patent:(i) that the nominated person is not an eligible person, but that the section 36 applicants are eligible persons; or
(ii) that the nominated person is an eligible person, but that the section 36 applicants are also eligible persons;
the Commissioner may declare in writing that the persons who the Commissioner is satisfied are eligible persons are eligible persons in relation to the invention as so disclosed.
Schedule 1 of the Act defines that an eligible person “in relation to an invention, means a person to whom a patent for the invention may be granted under section 15.” As such, while the two AU198 and AU549 applications have arrived before me by different mechanisms, the relevant legal principles are essentially the same.
The general approach to determining who is an eligible person may be summarised as:
i)Identify the “inventive concept” of the invention defined in the claims,
ii)Determine inventorship including the person responsible for the inventive concept and the time of conception as distinct from its verification and reduction to practice, and
iii)Determine whether any contractual or fiduciary relationships give rise to proprietary rights in the invention[52].
[52]University of Western Australia v Gray [2009] FCAFC 116; 179 FCR 346 (UWA v Gray Full Court)at [253]-[256].
For identifying the inventive concept, Polwood Pty Ltd v Foxworth Pty Ltd[53] provides that
“The invention or inventive concept of a patent or patent application should be discerned from the specification, the whole of the specification including the claims. The body of the specification describes the invention and should explain the inventive concepts involved. While the claims may claim less than the whole of the invention, they represent the patentee's description of the invention sought to be protected and for which the monopoly is claimed. The claims assist in understanding the invention and the inventive concept or concepts that gave rise to it. There may be only one invention but it may be the subject of more than one inventive concept or inventive contribution. The invention may consist of a combination of elements. It may be that different persons contributed to that combination”[54] (emphasis added).
[53][2008] FCAFC 9; 165 FCR 527 (Polwood).
[54]Ibid at [60].
And further, Vehicle Monitoring Systems Pty Ltd v SARB Management Group Pty Ltd[55] provides
“As to how the inventive concept is to be identified, he said (at [102]):
‘102 It is not possible to be very specific about how this is to be done. But as a general rule one will start with the specific disclosure of the patent and ask whether that involves the use of information which is really that of the applicant, wholly or in part or as a joint owner. … What one is normally looking for is “the heart” of the invention. There may be more than one “heart” but each claim is not to be considered as a separate “heart” on its own…’”[56] (emphasis added).
[55][2021] FCAFC 224; 288 FCR 247 (VMS)
[56]VMS at [63], quoting Markem Corp v Zipher Ltd [2005] EWCA Civ 267; [2005] RPC 31.
For the second step, it is said that it is conception which is the touchstone of inventorship[57], with the Court further noting that
“Their Honours referred to the discussion of inventive concept in Gunter v Stream 573 F 2d 77 (1978), where the ‘conception’ of the invention was described as the complete performance of the mental part of the inventive act. That is to say the invention is the formation in the mind of the inventor of a definite and permanent idea of the complete and operative invention as it is thereafter to be applied in practice: see also Burroughs Wellcome (1994) 40 F 3d 1223 cited above. What remains belongs in the department of construction. A concept can be complete although experimentation may continue. It is complete when a person of ordinary skill in the art could construct the apparatus without unduly extensive research of experimentation. Their Honours referred also to Mueller Brass Co v Reading Industries Inc 352 F Supp 1357 (1972) at [16], [17] for the proposition that inventorship is a role in the final conception of that which is sought to be patented (at [46]):
It is clear that, in working out the inventive concept in a patent, each patent will be different and it will be necessary to ascertain the inventive concept from the whole of the specification. Contribution after the invention was fully conceived where that contribution was under the direction of the inventor does not give rise to entitlement to the invention. A person must be able to say that without his or her contribution to the final conception it would have been less.
Their Honours described that philosophy as “apt”. For joint inventorship, each inventor had generally to contribute to the conception of the invention”[58] (emphasis added).
[57]University of Western Australia v Gray (No 20) [2008] FCA 498; 246 ALR 603 (UWA v Gray) at [1426].
[58] UWA v Gray at [1440].
Polwood discussed the indications of joint inventorship in Australia, summarised at [52]-[53] as:
“There has been some consideration of the principles of joint inventorship in Australia. In Costa v G R and I E Daking Pty Ltd (1994) 29 IPR 241 and Row Weeder Pty Ltd v Nielsen (1997) 39 IPR 400 joint inventorship was found where one person had a general idea of what was required in a machine but did not necessarily know how to put those ideas into effect and the other person did so. In Costa the Delegate of the Commissioner of Patents said that in his view, the question was whether the invention would have occurred without the second person’s involvement (at 246). In Row Weeder joint inventorship was said to arise where one person has a general idea for solving a problem but is unable to give effect to the idea while another person is able to do so. The Delegate of the Commissioner of Patents concluded in Row Weeder (at 405) that a person has entitlement to an invention if that person’s contribution, either solely or jointly with others had a material effect on the final concept of the invention. Whether or not that contribution involved a key inventive step was said to be secondary. Entitlement to joint inventorship does not apply to a person who, not being the true inventor, bases the claim on knowledge derived from that inventor (Stack at [18]).
In JMVB Enterprises Pty Ltd v Camoflag Pty Ltd (2005) 67 IPR 68 Crennan J said at [132] that rights in an invention are determined by objectively assessing contributions to the invention rather than assessing the inventiveness of respective contributions. The invention is to be looked at as a whole, as well as the component parts. The relationship between the participants, such as a collaboration (citing Re Applications by CSIROand Gilbert (1995) 31 IPR 67 at 72–73) is a relevant factor. Her Honour put it on the basis that, if the final concept of the invention would not have come about without a particular person’s involvement, then that person has entitlement to the invention (at [132])” (emphasis added).
The general principles of the first two steps are probably best summarised by French J in UWA v Gray at [1443]:
“In my opinion, the invention in each case in these proceedings is generally to be found described in the relevant specification which will be, for the most part, the applicable PCT specification. The time at which the invention was developed and the person by which it was developed is to be ascertained by reference to the inventive concept of the invention so described. The time of invention, and the identity of the inventor will not be affected by the subsequent process of reduction to practice some elements of which may have found their way into the claims in the application.”
Pipe Ex Pty Ltd also considers a further point from UWA v Gray to be worth special attention:
“An inventor need not know that the invention will work for conception to be complete. The inventor need only show that he or she had the idea. The discovery that an invention actually works is part of its reduction to practice.”[59]
[59] UWA v Gray at [1426], quoting from Burroughs Wellcome Co v Barr Laboratories Inc (1994) 40 F 3d 1223.
And relatedly, from Jagot J in Vector Corrosion Technologies Limited v E-Chem Technologies Ltd[60]:
“Contrary to the submissions for E-Chem, it is not the case that an inventive concept necessarily involves the ‘formation in the mind of the inventor of a definite and permanent idea of the complete and operative invention as it is hereafter to be applied in practice’ if, by this, E-Chem intends to suggest that the inventive concept must in fact work or be capable of being reduced to practice. This formulation was cited in [UWA v Gray Full Court] at [1426] and Polwood at [47]–[50] (citing Shum v Intel Corporation 499 F.3d 1272 (2007) at [6]). However, it is apparent that the characterisation of the inventive concept in Australian law depends on how the specification as a whole identifies the inventive concept, which may or may not include the manner in which an idea is carried out or the reduction of the idea to practice. [UWA v Gray Full Court] at [256] does not suggest otherwise. Nor does Sigma Pharmaceuticals (Australia) Pty Ltd v Wyeth [2010] FCA 1211; (2010) 88 IPR 459.”
[60] (2022) 166 IPR 61; [2022] FCA 188 at [18].
For contractual or fiduciary arrangements, for reasons which will become apparent, the most significant aspect will relate to the nature of the employment of the inventor. A useful summary is provided by Victoria University of Technology v Wilson[61]:
“The law is well settled upon the position of an officer or employee who makes an invention affecting the business of his or her employer. It is an implied term of employment that any invention or discovery made in the course of the employment of the employee in doing that which he is engaged and instructed to do during the time of his employment, and during working hours, and using the materials of his employers, is the property of the employer and not of the employee. Having made a discovery or invention in course of such work, the employee becomes a trustee for the employer of that invention or discovery, and he is therefore as a trustee bound to give the benefit of any such discovery or invention to his employer. But the mere existence of the employer/employee relationship will not give the employer ownership of inventions made by the employee during the term of the relationship. And that is so even if the invention is germane to and useful for the employer’s business, and even though the employee may have made use of the employer’s time and resources in bringing the invention to completion. Certainly, all the circumstances must be considered in each case, but unless the contract of employment expressly so provides, or an invention is the product of work which the employee was paid to perform, it is unlikely that any invention made by the employee will be held to belong to the employer” (emphasis added, citations omitted).
[61] [2004] VSC 33; 60 IPR 392 (Victoria University).
This was cited with approval by UWA V Gray Full Court[62], which added the following caution:
“We note in passing that it can, on occasion, be factually difficult to define the subject matter over which a particular employee’s inventive responsibility to the employer extends. This may be, for example, because (a) the employee’s engagement gives him or her considerable discretion in determining the area of inventive inquiry he or she will pursue for the employer’s benefit; or (b) the employee’s managerial and inventive responsibilities combined are such that he or she, as a fiduciary, is obliged to give the employer the benefit of any invention developed in the course of his or her employment that is germane to the employer’s business (see eg Fine Industrial Commodities Ltd v Powling (1954) 71 RPC 253; see also British Syphon Co Ltd v Homewood (No 2) [1956] All ER 897 which is probably better explained as a breach of fiduciary duty case); or (c) the employee’s inventive responsibilities evolve over the course of the employment as a result, for example, of the employment tasks changing: see eg British Reinforced Concrete, at 109.” (emphasis added)[63]
[62] UWA V Gray Full Court at 150.
[63] UWA V Gray Full Court at 155.
The inventive concept of AU198
Pipe Ex Pty Ltd’s submissions summarise the AU198 application much as I have above, and then summarises what they argue to be the inventive concept as being:
“A HPV with an internal filter (e.g., claims 1, 3) with a larger surface area (i.e., one that “extends across the central cavity” in the housing) (claim 1), such filter enabling a longer service life, less operator intervention (Cf [0038] of the 198 Application regarding prior art). The operator has easy access to the working components of the HPV (see e.g., [0044]; [0051]; [0066]). The system has a “reverse flush”, so it can be “quickly flushed clean of debris such as swarf, and without resulting in the spillage of any saline wastewater onto the ground surrounding the vent system 200”: see e.g., [0017]; [0030]; [0061]; claims 10-11. Additionally, an air gap is present, whereby, any debris which passes through the filter will not impede onto the actual seals within the mechanism itself leading to the mechanism failing open: see e.g., [0054]; Figure 4. Finally, the float has a float rod which connects to a seal: see e.g., [0055]. The float is protected from any debris by the filter within the chamber”[64] (italics in original).
[64] Pipe Ex’s written submissions at 36.
iGas contends that a number of the features identified by Pipe Ex Pty Ltd are merely preferred or optional features derived from the dependent claims or part of the prior art[65]. Instead, iGas says that the heart of the invention is:
“Having discussed the disadvantages of the prior art, [0006] of the specification of AU198 notes that there is a need for an improved HPV system. The disadvantages of the prior art are described in further detail by Mr Fekete at [61] of [Fekete#3]. In response to these challenges of the prior art, Mr Fekete describes the “heart” of the iGas invention as follows:
‘The iGas HPV addressed these issues by locating the float within a filter, rather than seeking to filter material at the entry point. This was crucial to the operation of the system as it meant that the float was protected from any material finding its way into the housing. Because the float is protected within the filter, the system can also be quickly flushed clean of debris without affecting the float.’”[66] (bold emphasis as per Mr Fekete’s declaration)
[65] iGas’s submissions at 55-56.
[66] iGas’s submissions at 53, quoting Fekete#3 at [62], emphasis as per Fekete#3.
iGas then goes on to say:
“In this context, Intelligas Technology submits that the invention as set out in the Summary of the Invention in the specification at [0008], is a combination of a number of features of an HPV system, in particular including a filter extending across a central cavity of a housing, with a float positioned in the central cavity, embodies the inventive concept. These are the features of claim 1.”[67]
and
“At RS[36] Pipe Ex seeks to add further features as part of the inventive concept derived from dependent claims and/or described preferred features. It has not explained why these form part of the inventive concept. These aspects of the alleged inventive concept which go beyond the features of claim are either merely optional preferred features (reverse flush) or part of the prior art (air gap, float with a float rod connecting to a seal).”[68]
[67] iGas’s submissions at 54.
[68] iGas’s submissions at 56.
Regarding a “filter that extends across the central cavity”: As can be seen above, both parties have made submissions about this point which, to my mind, appear odd. Pipe Ex Pty Ltd equate “extending across the central cavity” with a large surface area. However, referring to figure 3, if the filter had been an essentially flat disc extending horizontally across the cavity at the height of the bottom portion of the actual filter, that would plainly be “extending across the central cavity” but would also involve essentially the minimum possible surface area for the filter. I also note that there is nothing in the specification which describes the surface area as being a relevant factor.
As for iGas’s submissions, these seem to have an internal inconsistency: they quote Mr Fekete’s declaration that the crucial feature is locating the float within a filter, but suggest this somehow leads to the inventive contribution being the features of claim 1, which conspicuously locates the float in the central cavity, not within the filter. Perhaps this inconsistency could be resolved if “central cavity” was read as “the centre of the cavity” (such that both the float and filter are in some sense co-located), but that is not how I would have construed such terms. It is also odd that Mr Fekete was clear that one of the big advantages of the filter design was it allowed for quickly flushing the filter without affecting the float, but iGas regards this as merely an optional extra.
As I have summarised above, the specification describes a number of problems in the art: particulates and debris interfering with the operation of the valve, corrosion issues, operation at angles away from the vertical, difficulty in cleaning or maintaining the prior art Y strainers, and the failure of valves leading to environmental contamination. As also summarised above, the specification describes a number of advantages of the present invention: robust operation resistant to corrosion, redundant sealing features to ensure saline solution does not escape, capable of operating at inclined angles, and efficient or improved flushing, cleaning, and maintenance. The invention does not necessarily relate to all of these problems/advantages, but it presumably relates to at least one.
Claim 1 provides an HPV comprising a housing defining a central cavity, a filter extending across the central cavity, a float positioned in the central cavity, a float rod connecting the float to a seal, and a manifold defining a seal orifice adjacent the seal. As discussed above, the claim may define less than the whole of the invention (an observation which, if anything, is more likely in the case of an application prior to acceptance like AU198), but may be used to provide assistance in identifying the inventive concept.
The inclusion of a filter, to at least some extent, goes towards solving the problem of fines and debris interfering with the operation of the valve. But since the admitted prior art already include Y strainers (i.e., a type of filter), the inventive concept cannot be merely the provision of a filter. As I have alluded to above, the filter “extending across the central cavity” does not, of itself, seem to add anything over merely providing a filter.
The inclusion of a float within a housing/cavity is, in essence, acknowledged to be part of the prior art HPVs. From the specification, what seems different from the prior art is that the float is located in the same chamber as the filter, made possible by configuring the filter as a basket surrounding the float. This arrangement contributes towards the ease of maintenance problem in two ways. Firstly, as described in the specification[69], this arrangement allows for a backflush system that can “wash down an outer surface of the filter” in addition to backflushing through the filter. While it is not expressly stated in the words of the description, from the drawings it is apparent that this is possible because the outer surface of the filter surrounding the float is the upstream side (i.e., the surface which will be exposed to unfiltered fluid and in need of washing off). Secondly, the arrangement of including the filter and float in the one chamber improves ease of maintenance by simple reason of only requiring maintenance of a single chamber (as opposed to having to separately clean the Y strainer and float chamber).
[69] AU198 specification at [061]-[0062].
The float rod connected at the upper end to a seal, combined with a manifold defining a seal orifice, serve to constrain the general form of valve to which the invention relates (what I mean here is that the inventive concept of AU198 does not relate to ball type float valves). This arrangement is closely associated with the problem of reliable operation of the valve when inclined from the vertical, with the small orifice minimising the chances of vacuum causing the seal to stick closed.
While it was not included in claim 1, the check valve subsystem also warrants comment here. It is directed to the problem of preventing leakage of liquid to the environment, while also providing the advantage of preventing ingress of air into the system[70]. Because this is, in part, a redundancy subsystem (if the main seal operates correctly, the check valve subsystem does not need to act to prevent escape of liquid to the environment), so it may be said to be an optional feature. Indeed, the second embodiment exemplified in figures 6-7 do not include the check valve subsystem at all, and nor does the independent claim.
[70] AU198 specification at [0052].
Overall, my reading of the specification, including the claims, leads me to believe that the inventive concept of AU198 involves two distinct “hearts”: the first being that the central cavity contains a filter surrounding a float, and the second being a float rod, connected at the upper end to a seal, combined with a manifold defining a seal orifice.
The inventive concept of AU549
iGas summarises[71] the description and drawings of AU549 similarly to how I have above (albeit iGas is more concise). iGas then contends that the inventive concept of AU549 is “the use and combination of the various elements of the vent valve assembly described in the Summary of the Invention [essentially being the features of claim 1], and claimed in claim 1 of AU549.”[72] They put some emphasis on the point that [008] of the specification (the consistory clause according to claim 1) is the only one described as “an aspect of the invention” while all other consistory clauses [009]-[0025] (essentially matching dependent claims 2-18) are each described as “an embodiment” or “preferable”.
[71] iGas’s submissions at 35-43.
[72] iGas’s submissions at 57-58.
Pipe Ex Pty Ltd state they broadly agree, but would add two additional “key features” of a lower sealing ball in the lower chamber to block backflow or air ingress (which they identify with claim 2), and a drainage feature to drain accumulated liquid (which they identify with claims 8, 11, or 15). Pipe Ex Pty Ltd also provides some additional emphasis on the functions or operations of the features of claim 1,[73] such as that the purpose of the filter element sealing at the lower end is to create a collection chamber.
[73] Pipe Ex’s submissions at 41.
Both parties seem to have fallen into simply equating the inventive concept with the claimed invention, although at least Pipe Ex Pty Ltd went a little further by considering dependent claims. As discussed above, that is not the correct approach in Australian law, where the authorities are at pains to emphasise that the inventive concept must be determined from the specification as a whole. The claims may assist, but the analysis should not stop with the claims. For obvious reasons, the same caution applies against excessive reliance on consistory clauses.
As a first point, it is necessary to be clear what type of device the invention relates to: it is not an HPV per se (or at least, not in the sense consistent with AU198), but rather a backup valve in case the HPV fails in the open condition (note the problem identified at [007] of the specification relates to stopping the flow of liquid when the HPV fails in the open condition, which would be nonsensical if the AU549 valve was the only valve at the vent). The minimum requirement for this purpose is, simply enough, a redundant float valve comprising the buoyant upper sealing ball and associated outlet orifice. Also plainly enough, the inventive concept is more than this.
As noted above, the advantages offered by the invention relate to screening solid particles by the filter assembly, and ease of access and removal of the filter by way of the separable upper and lower sections.
At this point, I run into a few limitations with the AU549 specification. The specification and preferred embodiment involve a number of features which are not explained. A standout example of this is the “collection chamber.” This refers to the space within the cylindrical structure 402. When liquid rises in the valve assembly, once the liquid gets high enough to pass through screening perforations 405, liquid collects in the collecting chamber, causing the upper sealing ball to float. This explains what the collecting chamber is and how it interacts with the rest of the assembly, but not what purpose it serves. Equivalently, there is no direct explanation why the screening perforations only exists at the upper end of the cylindrical structure. It is hard to determine whether something is, or is not, part of the inventive concept until the functions and purpose are well understood, but the level of detail provided in the specification hints at the significance of these features, so it is worth analysing further.
The claim also indicates that the inventive concept relates to the diffuser plate. Similar to my comment above, while the specification provides reasonable detailed description of what the diffuser plate is and what its preferred design comprises, there is almost no explanation of what its purpose is. From its name alone, I can surmise its purpose is to diffuse the flow of air and/or liquid, but the specification has not explained why this is desirable. It does not appear related to the identified problems in the art (corrosion, fouling, and backup valve issues do not seem to rely on diffusing the flow). The other thing that is disclosed about the diffuser plate is that it divides the housing into an upper and lower chambers, and retains the upper sealing ball in the upper chamber. Again, there is no explanation for what the purpose of this is (especially in the case of claim 1, where there is nothing in the lower chamber). The diffuser plate also serves to help define the collection chamber, but as set out above that does not assist in determining what the purpose of these elements are.
While indirect, the specification provides a comment at [0035] in the context of the drain feature which I believe may illuminate the purpose of all of the diffuser plate, collection chamber/screening perforations only at the top, and the drain feature. [0035] describes that the collection chamber may be provided with a drain hole (as I noted previously, there is some inconsistency in how this drain is described), which is preferably positioned, with the assistance of any appropriate alignment means, adjacent the solid arcuate portion of the diffuser (i.e., opposite the through holes 510). This alignment is said to “[prevent] air from entering through the drain hole 415 and spinning or pushing the upper sealing ball 420 towards the vent outlet 205.” While this problem was referred to in the context of the drain hole, once the problem of air pushing the upper seal ball is realised, it is clear that the diffuser and collection chamber are actually addressing the same problem. The diffuser diffuses the gas flow, reducing the chance of blowing the float around, and the collection chamber/perforations being located only at the top of the cylindrical structure serve to direct air flow above the resting position of the ball.
In my opinion, once the specification is read as a whole, the true nature of the problem being addressed by the invention is providing a backup valve to prevent liquid escape that also does not close by air blowing the upper ball upwards. While this problem is somewhat buried within the specification, once recognised it is clearly the inciting motivation for all of the features of the claim, and most of the features of the detailed embodiment (with the exception of the lower sealing ball, threaded housing portions, pressure gauge, and external drain). This suggests that the inventive concept relates to the solution to this problem, and includes the combination of:
A)a housing defining a central cavity, having an inlet orifice at the bottom and an outlet orifice at the top,
B)a diffuser located in the central cavity, dividing the cavity into upper and lower compartment, and for the purpose of diffusing the upward flow of fluid into the upper compartment,
C)a cylindrical structure extending between the diffuser and the top of the housing, thereby defining a collection chamber formed inside the cylindrical structure and above the diffuser,
D)a buoyant sealing ball retained in the collection chamber, which floats to seal the outlet orifice when liquid level rises in the collection chamber,
E)the cylindrical structure provided with screening perforations only at the top end, which serves to direct air flow into the collection chamber at a height above the resting height of the sealing ball, and
F)the collection chamber having a draining arrangement configured to drain liquid from the collection chamber and aligned to reduce airflow from the diffuser entering the drain arrangement.
Note that this is not the same situation as AU198, where I found there were two hearts to the invention. Here, there is one heart of the invention comprising the combination of these features.
Conception of AU198
The Arrow Energy design
It was largely agreed that the key inventor of AU198 was Mr Nichols, so I will begin with Mr Nichols’ background and description of the art.
Mr Nichols is a mechanical and civil engineer who has been working in the oil and gas sectors since 1989, and in Australia specifically since 2011, when he joined the Queensland Gas Corporation, working on the production of liquid natural gas (LNG) extracted from coal seams (generally, coal seam gas or CSG). In 2013, he founded “Independent Pipeline Services”, which would later become “iPipe”, where he developed new machines, isolation devices, and tools for use in CSG. During this time he also contributed as a subject matter expert to the code of practice for “Upstream PE Gathering Systems” produced by the Australian Pipeline Gas Association[74].
[74] Nicols#2 at 3-6.
Mr Nichols says that at that time, the industry was grappling with emerging issues associated with HPVs and low point drains (LPDs) losing containment[75]. Mr Nichos’ first preliminary designs for an improved HPV are dated 15 June 2015, and were produced for a client named Arrow Energy[76]. Most of the information provided for this design show the exterior of the system and surrounding civil works, but I have copied one cross sectional drawing below. It will suffice for the moment to note that this design approximately matches the “prior art” design from figure 1 of AU198, except omitting the Y strainer.
[75] Nicols#2 at 7-10.
[76] Nichols#2 Annex DN-1.
The Smart Valve design
A second HPV design, labelled the “Smart Valve HPV”, is dated 28 November 2015[77], but only shows the exterior of the HPV. Mr Nichols also provides a photograph of what is clearly the same design, the photograph dated “4/11/2015”[78]. Mr Nichols contends that this should be read as 11 April 2025, i.e. that the date in the screenshot has the date in the American style of MM/DD/YYYY, but that seems unlikely, as the other Smart Valve drawings[79] use the more familiar DD/MM/YYYY format[80], and also because the 11 April 2025 date would imply that the Smart Valve was earlier than his self-admitted first design for Arrow Energy. Mr Nichols also provides further drawings which also relate to this Smart Valve which he states were made in 2016[81], however these still only show the exterior of the Smart Valve. The Smart Valve designs are labelled with the company names “iPipe” or “iPipe Services”.
[77] Nichols#2 Annex DN-2.
[78] Nichols#2 Annex DN-3, being a screenshot of the file record of the image with a date marking.
[79] Nichols#2 Annex DN-2.
[80] See also Nichols#2 Annex DN-5, which includes a similar screenshot of file record as DN-3, dated “20/05/2016”.
[81] Nichols#2 Annex DN-4.
Mr Nichols then explains that, as part of his role as managing director and chief technological officer (CTO) at iPipe, he produced a draft technical document with capability statements for the Smart Valve in 2016[82]. As confirmation of this approximate timeframe, Mr Nichols provided a quotation for validation services from Practical Engineering Australia Pty Ltd dated 1 June 2016[83]. I will refer to this as the Smart Valve design.
[82] Nichols#2 Annex DN-5.
[83] Nichols#2 Annex DN-6.
The general layout of the Smart Valve design is shown in the first image of DN-5. On the right, it comprises a first cylindrical chamber with a lower flange at the base, which is the inlet to the Smart Valve. This is coupled via a short pipe to a second chamber on the left, which has an outlet vent at the top. Both chambers are sealed at their top ends by bolted flanges and plates. This is all consistent with the 2015 documents.
The internal workings of the Smart Valve are shown in sectional drawings, copied below. They show that the first chamber (now on the left) contains a filter, while the second chamber contains a float. The float is attached to a “swivel rod” which prevents bending and twisting of the float being transferred to the seals of the sealing mechanism. In operation, gas (yellow) and liquid (blue) enter the valve from the lower flange of the first chamber and passes through the filter, such that any debris (referred to as “swarf, sludge, and other impurities”) is retained within the filter. Liquid and gas then pass to the second chamber, with the liquid raising the float, causing the sealing mechanism to close. When the water level drops, the debris returns out of the filter with the liquid and the valve opens to allow gas to pass through.
DN-5 also describes a secondary float valve which activates if the HPV fails open, to prevent liquid releasing to the environment. Mr Nichols refers to this as a “Secondary Fail Safe Valve”, however this nomenclature seems to be an anachronism (the “secondary fail safe valve” terminology does not appear in any of the Smart Valve documents, but is used extensively later on).
As a perhaps minor point: I noted at the hearing that DN-5 described the Smart Valve as “a patented two chamber system”. I inquired if there was any further information about this patent, and was informed by Pipe Ex that there was no actual patent, and the reference was merely “marketing puffery.” Again, like the issue of date formats and anachronistic naming above, this is essentially a trivial point, but it is another instance where Mr Nichols (who produced DN-5) demonstrates a habit of misrepresentations.
Pipe Ex Pty Ltd contends that the Smart Valve design demonstrates the features of the inventive concept, which they described by way of the following marked up images:
and the following references to the features of claim 1 (which, as discussed above, they felt largely reflected the inventive concept):
“a housing defining a central cavity [A] consisting of [A1] & [A2]
a filter [B] that extends across the central cavity (being the cavity comprising portions A1 and A2);
a float [C] positioned in the central cavity;
a float [D] rod having a lower end [D1] and an upper end [D2], the lower end of the float rod [D1] connected to the float [C] and the upper end of the float rod [D2] connected to a seal [S]; and
a manifold [E] connected to the housing [A2] and having an input end [E1] and an output end [E2], wherein the input end [E1] defines a seal orifice [E1S] that is positioned adjacent to the seal [S].”In addition, Pipe Ex Pty Ltd makes special note of the way the “float rod” of the Smart Valve extends into a cylindrical space to create a narrow annular air gap around the float rod[84], similar to AU198.
[84] Pipe Ex’s submissions at 51(b)-(e).
iGas makes a few counter points against this. As a first point, they note that Mr Nichols himself did not seem to think the Smart Valve was the same as the AU198 invention, instead Mr Nichols stated that:
“During the time of my involvement with IntelliGas through 2020, I was involved in developing a HPV device, which was a progression from the earlier ideas that has been developed during my tenure at iPipe. Developments in the HPV device eventually resulted in the development of the Patent … The development of this device was based and developed upon foundation intellectual property that was developed during my time at Pipe Ex”[85] (emphasis added).
[85] Nichols#2 at 29.
Along the same line, iGas also points to comments made by Mr Nichols in an email dated 10 February 2022 that refer to “IP to date under 9000” including “HPV and all associated entities”[86], and additional comments in another email from Mr Nichols dated 17 February 2022 that refers to “New IP such as: High Point Vents…”[87] (the reference to “under 9000” will be explained later, but for now it suffices to note it relates to activities well after 2016). iGas argues that these comments suggest that Mr Nichols regarded the AU198 invention as distinct from the Smart Valve, and developed much later than the Smart Valve[88].
[86] Nichols#2 Annex D-12.
[87] Nichols#2 Annex D-13.
[88] iGas’s submissions at 60.
iGas also submits that the Smart Valve fundamentally differs from the AU198 design. They say the Smart Valve is conceptually closer to the prior art figure 1 of AU198. They say that the first chamber of the Smart Valve and its associated filter is essentially a direct replacement of the Y strainer configuration that AU198 acknowledges as the prior art[89]. They also argue that the overarching design is also markedly different, in that the Smart Valve is a “dual chamber” system quite different to the “single chamber” system of AU198[90].
[89] iGas’s submissions at 63.
[90] iGas’s submissions at 64-65.
At the hearing, this point about “dual chamber” vs “single chamber” was discussed some more. Pipe Ex Pty Ltd submitted that AU198 is a dual chamber design: in figure 4, there is a second chamber immediately below the manifold 330, this chamber containing the seal element 415. Pipe Ex Pty Ltd contends that, in this sense, AU198 is a dual chamber design, one for the filter and one for the valve, just like the Smart Valve.
Regarding the dual chamber design, I must agree with iGas. As I noted above, the first heart of the invention is that the central cavity contains a filter surrounding a float. In the Smart Valve design, perhaps the most defining aspect of the design is the use of a separate filter chamber separate from the float chamber. As such, I do not agree that the Smart Valve demonstrates the first heart of the invention.
However, as to the second heart, the Smart Valve does superficially appear to represent a step along the way. As I noted above, it describes the use of a swivel rod between the float and valve seals, which seems to be a marked departure from the prior art lever arm arrangements. At least superficially, there is a similarity between the swivel rod of the Smart Valve and the float rod of AU198. However, there are a few points worth noting: Firstly, the swivel rod of the Smart Valve appears to be for a subtly different purpose. Its goal is stated to be “[ensuring] that the seals remain in-shape without threat of disfigurement or objects interrupting their service life”[91]. While I can see that the float rod and manifold arrangement of AU198 may achieve the same thing, as I have described above, I understand the point of the float rod and manifold of AU198 is instead related to the issue of operating at inclined angles. There is no suggestion that the Smart Valve addressed this issue.
[91] Nichols#2 Annex DN-5.
Summing up, the Smart Valve has a rod between the float and seal, but the valve seat of the Smart Valve (the notional equivalent of the manifold of AU198) appears relatively large, and there is no evidence that the Smart Valve was ever expected to operate at inclined angles. As such, while there are certain similarities in design, I do not agree that the Smart Valve demonstrates the second heart of AU198.
The iGas HPV design
Mr Nicols states that he stopped working on the Smart Valve design “[i]n or around 2016” for commercial reasons[92]. As far as the evidence in front of me suggests, no further development occurred until Mr Nichols joined iGas.
[92] Nichols#2 at 16.
While the corporate structures and working relationships will be discussed more below, for the sake of keeping the timeline clear, it is worth noting that in 2019, iPipe was acquired by Monadelphous Group. Mr Nichols (apparently briefly) joined Monadelphous Group as a Business Development and Growth Strategy Advisor, and approximately at the same time Mr Nichols founded Pipe Ex Pty Ltd[93]. Around the same time there were conversations between Mr Nichols and iGas, which would culminate with Mr Nichols joining iGas as the Chief Operating Officer of iGas Operations Pty Ltd on 28 October 2019[94].
[93] Nichols#2 at 17-18 and 23.
[94] Nichols#2 at 25, although note Mr Nichols refers to iGas generally as “IntelliGas”.
Mr Nichols states that:
“During the time of my involvement with IntelliGas through 2020, I was involved in developing a HPV device, which was a progression from the earlier ideas that has been developed during my tenure at iPipe. Developments in the HPV device eventually resulted in the development of the Patent which was conceived by myself, and then handed to Ernst Graff, Patent Attorney at Spruson & Ferguson who finalised the Patent and filed a provisional patent application (AU2020904128) on 11 November 2020 and an associated International Patent Application (PCT/AU2021/051337) entitled “HIGH-POINT VENT SYSTEM”. The development of this device was based and developed upon foundation intellectual property that was developed during my time at Pipe Ex…
The work done on the HPV Patents was an extension or continuation of the work done on the Smart HPV device which had been carried out at iPipe and then PipeEx.”[95]
[95] Nichols#2 at 29.
The provisional and international patent he refers to are the provisional and PCT phase of AU198 respectively. While Mr Nichols clearly considers features of an HPV were developed and conceived by himself during this time, he is not specific as to what features were developed at what times. Some of these details are provided by Mr Fekete.
Mr Fekete describes that before Mr Nichols joined iGas, iGas’s business had three main lines: commercialising high density compression gas technologies in the form of converting diesel trucks to use methane gas; development of an energy oil box; and acting as the Australian distributor for Fornovo Gas biogas compatible compressors[96]. Mr Nichols joining with iGas was seen as an opportunity to develop an HPV product, along with certain other products[97].
[96] Fekete#3 at 53.
[97] Fekete#3 at 54-55.
Mr Fekete describes that the HPV product development involved iGas’s engineering team working under direction of Mr Nichols, and was carried out in iGas’s workshop. Mr Fekete states that he was also involved in ongoing conversations about the project[98]. The first iteration of this HPV design was produced “around October/November 2020”, which Mr Fekete says is shown in the photo below[99]:
[98] Fekete#3 at 54-56.
[99] Fekete#3 Annex DF-13.
Mr Fekete states that the device on the left (the one on the right is not mentioned) used a float structure, with rising gas passing around the float and into the atmosphere, but the float rising in liquid to block the upper opening to prevent contaminated water being released. The structure at the top is “a secondary sealing valve” acting as a backup in the event the main HPV fails to seal. This backup valve also acted to prevent air backflowing into the system. The earliest detailed drawings of the internals of this design available in the evidence are allegedly from “during or prior to September 2020”[100], and a copy of a relevant portion is copied below. This drawing uses an Intelligas-branded drawing template, but has left the date, drafter, approver, and document ID fields blank. Having said that, Mr Fekete states that Mr Nichols was the lead developer and the engineering team worked under his direction[101], so it seems the drawing may be attributed to either Mr Nichols directly, or otherwise someone operating under his direction. No other potential contributors have been identified.
[100] Fekete#3 at 57-60.
[101] Fekete#3 at 56.
These drawings are clearly an earlier draft of figures 3 and 4 of AU198, only omitting the reference numerals. This is unsurprising, given the provisional application 2020904128 was filed on 11 November 2020, only a couple of months after these drawings were prepared. These figures demonstrate each element of the inventive concept, with the left figure showing the features of the first heart, and the right figure showing the features of the second heart.
As a whole, the evidence supports that the inventive concept of AU198 was conceived by Mr Nichols sometime between 28 October 2019 and September 2020.
Conception of AU549
The Smart Valve design
Neither party contends that AU549 was conceived before 2019[102]. However, I will briefly address a point about the Smart Valve design. As noted above, the 2016 document[103] describes a secondary float valve. However, the level of detail is short, and comprises (in total):
“secondary float valve which activated if the HPV fails open, protecting the environment and the operators license to operate…
As a failsafe system, a secondary float valve can be incorporated downstream of the secondary chamber in the unlikelihood of a primary float failure…
Sometimes, High Point Vents fail open discharging water to grade. This can be seen as an environmental issue with landowners. This unique design has a secondary isolation valve to stop water should the HPV fail open.”
[102] Pipe Ex’s submissions at 40, iGas’s submissions at 62.
[103] In the AU549 evidence, this is Nichols#1 Annex DN-5.
The repetition implies Mr Nichols considered the secondary float valve to be a significant feature of the design, but the document provides no detail on what it actually comprised. As such the Smart Valve only serves to indicate that Mr Nichols was aware of the general need for a backup valve, but does not establish that he was at that time aware of the secondary problem associated with the air flow prematurely closing the valve, let alone the solution which forms the inventive concept.
The SFSV1 design
Mr Fekete’s declaration states that the first backup valve developed within iGas was developed contemporaneously with the iGas HPV design, “around October/November 2020”, and was referred to as the “SFSV1” (or the first “secondary fail safe valve”)[104]. His evidence for this is the same photograph as discussed in respect of the iGas HPV design above, with the SFSV1 being the small steel structures above the main chamber (in black in the photograph). I note that iGas’s second declarant, Mr Clarkson, indicates that work on this design was already in progress when he joined iGas in July 2020, but he agreed the SFSV1 prototype was completed by October or November 2020[105].
[104] Fekete#1 at 37-40.
[105] Clarkson#1 at 17-19.
Mr Fekete states that the SFSV1 design “utilised a two chamber, two ball system to prevent contaminated water leaks and also prevent air ingress in the pipe in the case of vacuum conditions.”[106] The idea was that the first, lower valve was a ball type check valve allowing flow in the upwards direction but block air flowing downwards, while the second, upper valve was a float valve allowing air to flow upwards but would close under the action of water[107]. This much seems consistent with the photograph, which plainly shows two sequential chambers connected by a short pipe. Mr Fekete also describes a “baffle” in the SFSV1 that directs gas flow around the upper sealing ball. Mr Clarkson describes the SFSV1 in similar terms[108].
[106] Fekete#1 at 43.
[107] Fekete#1 at 44-45.
[108] Clarkson#1 at 20-21.
Supporting Mr Fekete’s comments about the internal structure of the SFSV1, on 11 November 2020 the provisional application AU2020904128 was filed, from which AU198 derives priority. The relevant portion of AU198 is what is referred to as the “check valve subsystem” which I have described above.
The SFSV1 design evidenced by Mr Fekete and the AU198 application displays a number of features relevant to the AU549 inventive concept. It is a backup valve having a housing defining a central cavity with an inlet orifice at the bottom and an outlet orifice at the top, a dividing element (“an element” in the language of AU198, a “baffle” in Mr Fekete’s declaration) dividing the cavity into upper and lower chambers, the upper chamber containing a buoyant sealing ball which floats to seal the outlet orifice whin liquid level rises. Importantly, AU198 relevantly states that:
“Element 465 integrates flow passages that direct flow annularly around the check ball 450 such that the check ball 450 is not lifted by the gas flow. The ball 450 is thus only lifted by floating in a liquid, should the chamber in which it resides fill with water.”[109] (emphasis added)
[109] AU198 specification at [0060].
Mr Fekete described the “baffle” in similar terms. To me, the idea of directing air around the ball with the aim of avoiding the ball lifting clearly suggests that the problem which AU549 seeks to address was clearly known by November 2020.
Both Mr Fekete[110] and Mr Clarkson[111] agree that Mr Nichols was the leader in designing the SFSV1. Mr Nichols’ description of these events is somewhat harder to follow. He says that Mr Fekete’s description of the HPV development “is factually incorrect”, with the apparent correct characterisation being “the feature of the secondary fail safe concept had been identified [in the Smart Valve Design]”.[112] He also states:
“the development of the Secondary Fail Safe Valve had been commenced well before [2019-2020]… It was my understanding that any continuation of the work through 2020 and 2021 that was to remain under the ownership of PipeEx [sic]”[113] (emphasis added).
[110] Fekete#1 at 37.
[111] Clarkson#1 at 18.
[112] Nichols#1 at 31.
[113] Nichols#1 at 31.
I think the problem here is Mr Nichols is problematically conflating his opinions about how ownership of ideas works together with his opinions on what it means to develop those ideas. Put more simply, what Mr Nichols seems to be suggesting is that he implicitly treats identifying the problem to be solved as being the true inventive concept, and all development work as being merely reduction to practice, and therefore not important. This perspective is very unhelpful, as it means Mr Nichols does not identify which ideas were developed at what dates. It is also quite inconsistent with some of his later comments, which I will come to later.
Regardless of the correct legal construction and operation of the amended NPSA (which is beyond the scope of the role of the Commissioner anyway), what seems to have actually occurred was that iGas created an internal business unit which used the name “Pipe Ex” (from available evidence, they do not appear to have used the full Pipe Ex Pty Ltd business name), with all work conducted in this business unit internally recorded as being “allocated the cost code 9000”[159]. This business unit (which I will refer to as “Pipe Ex 9000”) was then treated as though it was “the Pipe Ex subsidiary” for the purposes of the NPSA. While Mr Nichols has not commented on the 9000 cost code in his declarations, he does seem to be aware of the code, as in emails dated 10 February 2022 he referred to “IP to date under 9000” as including “HPV and all associated entities” and “HPV loss of containment valve.”[160] As noted above, this also appears to have utilised iGas’s resources and personnel, further indicating the work was conducted within Pipe Ex 9000 rather than within Pipe Ex Pty Ltd (the company).
[159] Fekete#3 at 34, 38.
[160] Nichols#2 annexure DN-12, also included as Nichols#1 annexure DN-11.
For the purposes of this decision, it is not necessary for me to resolve how the amendment to the NPSA would function (in the end, there were no profits to be shared anyway, but, again, that is not of any particular relevance to my analysis). It is sufficient to note that the behaviours of both parties seem to indicate that the Pipe Ex 9000 business unit within iGas would fill the role of the “the Pipe Ex subsidiary” for the purposes of the NPSA, and that the intention was that all other terms of the NPSA would remain unaffected.
Drawing all of the above together, I consider that the senior position of COO tends to suggest an expansive role, overseeing all of the relevant operations of the iGas Operations business. Mr Nichols acknowledges that, at the relevant time, iGas Operations was “primarily an R&D business”[161] that had yet to commercialise its products. Clearly, at least one of the operations ongoing within iGas which the COO would need to exercise broad oversight over included product development. This, to my mind, produces a positive duty to invent in respect of the products developed within iGas. While the profusion of entities with the Pipe Ex moniker may have caused some general confusion, in the end it seems that the relevant products were developed within the Pipe Ex 9000 cost code, being an internal business unit of iGas. Pipe Ex 9000 has (as far as I can ascertain) no legally distinct identity from the rest of iGas, and its operations fall squarely within the operations over which Mr Nichols had oversight as COO.
[161] Nichols#2 at 24, noting that Mr Nichols appears to use “IntelliGas” as the generic name for all iGas entities.
Under these circumstances, I am satisfied that the AU198 invention was developed in the course of Mr Nichols’ duties as COO, and therefore, consistent with UWA v Gray, he was obliged, as a fiduciary, to give iGas Operations the benefit of the invention. It follows Mr Nichols was not free to assign any rights in the invention of AU198 to Pipe Ex Pty Ltd.
For completeness, I note Pipe Ex Pty Ltd (the party to these proceedings) made arguments about the significance of the fact that the PBA did not include any terms about purchasing or transfer of any intellectual property. This is true, but is putting the cart before the horse: Pipe Ex Pty Ltd (the company) could not have owned the relevant IP at the time of the PBA, as it had yet to be conceived, so iGas could not have purchased it through the PBA.
Also, for completeness, there is arguably a final link missing in the chain: the transfer of entitlement from iGas Operations to Intelligas Technology Developments Pty Ltd. However, the onus lies with Pipe Ex Pty Ltd (the party to these proceedings) to demonstrate Intelligas Technology Developments Pty Ltd is not entitled, not the other way around. In order to resolve the s36 request, it will suffice to conclude that Pipe Ex Pty Ltd (the party to these proceedings) have not demonstrated that Intelligas Technology Developments Pty Ltd is not an eligible person in respect of AU198, and nor have they demonstrated that Pipe Ex Pty Ltd is an eligible person in respect of AU198.
Fiduciary and commercial relationships at the time of conception of AU549
As I identified above, the relevant date for AU549 was 13 February 2022. Above, I have set out Mr Nichols’ role as COO at iGas and how that gave rise to an obligation that any invention developed within his role at iGas be conferred to iGas[162].
[162] Note that, while the two matters have not been formally joined such that evidence in respect of AU198 is not automatically incorporated into the evidence for AU549, there is sufficient duplication of material in the two evidence sets that the AU549 evidence supports the same conclusions regarding Mr Nichols role as COO.
However, one major change occurred between the period considered for AU198 and the relevant date for AU549: on 4 February 2022, Mr Nichols offered his resignation from the role of COO[163]. In the letter, he states that the four-week notice period required by his contract would comprise Monday 7 February 2022 to Friday 4 March 2022.
[163] Fekete#1 annex DF-15, also included as Fekete#3 annex DF-15.
Pipe Ex Pty Ltd argues that Mr Nichols was effectively on “gardening leave” after submitting his resignation. They say that during such a period, there can be no “duty to invent”, or in the language of Victoria University, during the gardening leave period it cannot be said that Mr Nichols was instructed to do anything[164] .
[164] Pipe Ex Pty Ltd’s submissions at 81-82.
I note at this point that, while there is agreement that Mr Nichols spent at least some portion of his notice period on leave, there is dispute as to when exactly this happened. Mr Fekete says that Mr Nichols continued to attend the office, and retained access to his company laptop, until 16 February 2022. Mr Fekete attempted to demonstrate this with a screen shot of the documents folder taken from Mr Nichols’ laptop, which indicates certain documents were modified on various dates from 3 to 16 February 2022, and several modified much later in October 2022, which Mr Fekete acknowledges were modified by himself. At the hearing, I noted that since the screenshots do not identify who modified the documents, it was hard to see how it proved Mr Nichols’ involvement. This is exacerbated by the later modifications (and the screenshot itself) by Mr Fekete, which clearly demonstrate that Mr Nichols was not the only person to have access to the laptop.
Related to the same point, as discussed under the “February 2022 sketches” section above, at some time in February Mr Nichols had a meeting with Santos. Mr Nichols states that this was to discuss LPD and HPV issues[165], but he does not say whether or not this was part of iGas business. Pipe Ex Pty Ltd argues that there would have been no reason for Mr Nichols to meet with Santos in his capacity as COO, given he had already resigned[166]. However, that ignores that the purpose of a notice period is to provide a period of continued work before final resignation. Mr Fekete suggests that this meeting was iGas business, as Santos was an iGas customer[167]. Mr Nichols seems aware that Santos was an iGas customer[168], although I note that Mr Nichols does appear to have had long standing interactions with Santos pre-dating his employment with iGas[169]. I also note that during the notice period, iGas appears to have wanted to maintain some relationship with Mr Nichols. A letter from Paul Whiteman dated 22 February 2022 mentions iGas’s desire for Mr Nichols to continue “promoting a positive picture of the products and the relationship between you, the company, and its clients”[170]. This implies a tacit understanding that Mr Nichols would continue to have some sort of relationship with certain iGas clients even after leaving the iGas role. However, that does not suggest any acceptance or condoning of him engaging in non-iGas conversations with iGas customers while drawing iGas salary. While it is not unambiguous, it is tolerably clear to me that client relations, such as the meeting with Santos, formed part of Mr Nichols’ service to iGas.
[165] Nichols#1 at page 13.
[166] Pipe Ex Pty Ltd’s submissions at 83.
[167] Fekete#2 at 43-44.
[168] Nichols#1 at page 10.
[169] Nichols#1 at 6 and 10.
[170] Nichols#1 annex DN-13.
As to the exact date Mr Nichols went on leave, while I have some reservations about Mr Fekete’s screenshot evidence, it is noteworthy that Mr Nichols has not directly refuted it or even offered an alternative date for when his gardening leave commenced. As such, in the absence of any alternative, I consider the evidence suggests Mr Nichols was continuing to perform at least some duties for iGas up to around 16 February 2022.
At the hearing, there was an interesting discussion around what legal precedent, if any, exists relating to any duty to invent during an employee’s notice period or during gardening leave. While neither party was able to identify any precedent that squarely answers the point in respect of inventions, Ms Crooks, when put on the spot, was nevertheless able to identify Zomojo Pty Ltd v Hurd (No 2)[171]. This was a corporation law matter rather than intellectual property, but the critical point (for my purposes) was that:
“What a careful reader will notice is that Hurd failed to explain what had changed between the period before his resignation and the commencement of his notice period. The answer, of course, was nothing. If Hurd’s conduct was wrong in the notice period (and it was), his conduct was wrong prior to the notice period.”[172]
And later
“Under cl 8.9 of his Service Agreement, Hurd was entitled to terminate the Service Agreement by giving one month’s notice. Hurd’s email of 11 January 2011 constituted that notice. Hurd’s notice period under his employment contract expired on 11 February 2011. Hurd remained an employee until 11 February 2011. Zomojo did not remove him as a managing director (pursuant to cl 16 of Zomojo’s Constitution). Hurd remained in that position – as a co-managing director – until 11 February 2011.”[173]
[171] [2012] FCA 1458 (Zomojo).
[172] Ibid at 140.
[173] Ibid. at 222.
The implication from this being that, at least in regards to the matters under consideration in Zomojo, the date of giving notice does not alter the obligations owed to the employer, only the actual termination date ends the obligations. This seems like a reasonable proposition in the present matter as well.
Overall, I consider that at the relevant date, Mr Nichols obligations to iGas operations were the same as they were for AU198. It follows that he was obliged, as a fiduciary, to give iGas Operations the benefit of the invention, and, as such, iGas was entitled to the invention of AU549. For the same reasoning, Mr Nichols was not free to assign any rights in the invention to Pipe Ex Pty Ltd, and as such Pipe Ex Pty Ltd is not entitled to the grant of a patent.
Other Matters
There are now a couple of residual matters that were raised during the hearing which are now essentially otiose, but I will quickly dispense with them now for completeness.
Section 59(a)(ii)
iGas Operations Pty Ltd’s SGP also includes S59(a)(ii) as one of the grounds of opposition, but having succeeded on S59(a)(i) there is no need to discuss entitlement in conjunction any further.
Reg. 5.23
In the written submissions filed ahead of the hearing, iGas made note that, in the event I were to find some aspect of either invention was contributed by Mr Nichols either before or after his employment with iGas, there was no evidence of how any rights to such contributions would flow to Pipe Ex Pty Ltd. This prompted Pipe Ex Pty Ltd to file documents, each alleging to transfer IP rights from Mr Nichols to Pipe Ex Pty Ltd (one dated 2019, and the second dated 2022), which Pipe Ex Pty Ltd requested to be considered under Reg. 5.23. After considering the matter, I reached the opinion that, if Pipe Ex Pty Ltd was successful in showing the invention had been conceived before his employment with iGas, then the 2019 assignment agreement would likely to be crucial (in the Reflex Instruments Asia Pacific Pty Ltd v Minnovare Limited[174] sense, noting “likely” does not mean “certain”). As such, I admitted the 2019 assignment agreement under Reg. 5.23. In their 5.23 response, iGas identify a number of potential deficiencies with the 2019 agreement. However, in light of my findings above this point is largely otiose: the 2019 assignment agreement pre-dates both of the inventions, and Mr Nichols was not free to make such an assignment anyway. As such, the 5.23 material is ultimately not relevant.
[174] [2017] APO 8; 128 IPR 173.
Refusal
In their written submissions and elaborated on at the hearing, iGas made the unusual request that, in the event I were to find that iGas and Pipe Ex Pty Ltd are jointly entitled to the invention, that I should refuse AU549 under S60(3A). The crux of the argument was that the relationship between the parties has now deteriorated to the point where iGas felt joint ownership was unfeasible, and as such, it would be inappropriate to allow an amendment to make them co-applicants/co-patentees. This prompted much discussion over whether or not this course of action is even available to me. While that may be of academic interest, in light of my findings above, this question is also otiose.
Remedies
In light of the discussions around refusal and apparent confusion over how the current matters are to be resolved, I will make a couple of short observations.
Regarding AU198, the next steps are straightforward: the s36 request has failed, so now it will continue under the name of Intelligas Technology Developments Pty Ltd (pending, of course, any appeal of this decision).
Regarding AU549, for the reasons above, I am satisfied that there is a valid ground of opposition against the grant of the application in its current form; specifically, that the nominated person is not entitled to a grant of a patent for the invention (Section 59(a)(i)). Being so satisfied, I may refuse the application (Section 60(3A)), however, I must not do so without, where appropriate, giving a reasonable opportunity for the applicant to amend the relevant specification for the purposes of removing the ground of opposition (Section 60(3B)). For reference, a similar situation played out in Liquid Time Pty Ltd v Smartpark Technologies LLC[175]. The delegate found the named applicant was not an entitled person, but concluded that, since it would appear possible that the named applicant could file a request to amend the patent request to remove their own name and insert the eligible person as applicant, it was appropriate to allow an opportunity to amend.
[175] [2020] APO 48; 161 IPR 164.
As such, I will allow the applicant two (2) months from the date of this decision to amend the application. If they do not do so, or if any amendment they make is not persuasive, I may then refuse the application.
Since it would appear at least somewhat unlikely that Pipe Ex Pty Ltd would voluntarily remove themselves as applicant, I will draw iGas’s attention to the operation of Section 33 of the Act, which relevantly provides that:
(1) If:
(a) an application has been made for a standard patent; and
(b) the grant of the standard patent is opposed under section 59 by one or more persons; and
(c) the Commissioner decides, under section 60, that:
(i) one or more opponents are eligible persons in relation to the invention, so far as claimed in any claim of the opposed patent application (the original claim); and
(ii) the nominated person in respect of the application is not an eligible person in relation to the invention; and
(iii) there is no other reason that a patent should not be granted; and
(d) a complete application is made under section 29 by one or more of the eligible persons for a patent in relation to the invention;
the Commissioner may grant those eligible persons a patent jointly for the invention, so far as so claimed.
…
(5) If the Commissioner grants a patent under subsection (1), (2), (3) or (4), the claims of that patent granted have the same priority date as that of the original claim referred to in the respective subsection. (emphasis added)
And relatedly, the operation of Regulation 3.8, which relevantly provides that:
An application under section 29 of the Act must be made:
(a) in the case of an application of the kind described in section 33 of the Act—within 3 months of the decision of the Commissioner referred to in paragraph 33(1)(c), (2)(c), (3)(c) or (4)(b) of the Act, as the case requires; (emphasis added).
That is, while the simplest way for the AU549 matter to be finally resolved would be for Pipe Ex Pty Ltd to amend the patent request to make iGas Operations Pty Ltd the nominated person, it will be open to iGas to file their own complete application for the invention within three (3) months of the date of this decision.
SUMMARY
For the reasons given above, I am not satisfied Pipe Ex Pty Ltd is an eligible person in respect of AU2021377198. Therefore, the S36 request is unsuccessful.
For the reasons given above, I am satisfied that Pipe Ex Pty Ltd is not an eligible person in respect of AU2023201549. Therefore, the S59 opposition is successful.
I allow two (2) months from the date of this decision for Pipe Ex Pty Ltd to amend the application to attempt to overcome the grounds of opposition.
COSTS
It is usual for costs to follow the event, and I see no reason to depart from that here. For the sake of avoiding any ambiguity:
In the matter of the request under section 36 of the Act in respect of application 2021377198, I award costs according to schedule 8 against the requestor, Pipe Ex Pty Ltd.
In the matter of the opposition under section 59 of the Act to the grant of a patent on application 2023201549, I award costs according to schedule 8 against the applicant, Pipe Ex Pty Ltd.
Andrew Burgess
Delegate of the CommissionerANNEX
Claims of AU198
1. A high-point vent system, comprising:
a housing defining a central cavity;
a filter that extends across the central cavity;
a float positioned in the central cavity;
a float rod having a lower end and an upper end, the lower end of the float rod connected to the float and the upper end of the float rod connected to a seal; and
a manifold connected to the housing and having an input end and an output end, wherein the input end defines a seal orifice that is positioned adjacent to the seal.2. The high-point vent system of claim 1, further comprising a check valve subsystem connected to the output end of the manifold.
3. The high-point vent system of claim 1, wherein the filter comprises a filter basket that receives the float.
4. The high-point vent system of claim 2, wherein the check valve subsystem comprises two check valves, a gas valve for preventing gas from entering the system, and a liquid valve for preventing liquid from exiting the system.
5. The high-point vent system of claim 4, wherein the gas valve comprises a first check ball that is moveable between an upper seat that enables gas to flow through an annular orifice and out of the system, and a lower seat against which a surface of the check ball seals.
6. The high-point vent system of claim 4, wherein the liquid valve comprises a second check ball that is moveable between a lower seat that enables gas to flow through an exit orifice and out of the system, and an upper seat against which a surface of the check ball seals, sealing the exit
orifice.7. The high-point vent system of claim 6, wherein the second check ball is buoyant in water.
8. The high-point vent system of claim 2, wherein the first check ball and the second check ball are separated by an element having an upper curved surface for receiving the second check ball, and a lower curved surface for receiving the first check ball, whereby, in use, when gas is exiting the system through the manifold, the first check ball rests against the lower curved surface and the second check ball rests against the upper curved surface.
9. The high-point vent system of claim 2, wherein the first check ball and the second check ball are separated by an element that provides an annular passage for flow around the second check ball to prevent flow from gas lifting the second check ball.
10. The high-point vent system of claim 1, further comprising a reverse flush subsystem connected to the housing.
11. The high-point vent system of claim 10, wherein the reverse flush subsystem comprises a first valve connected to a lower end of the housing, and a second valve connected to an upper end of the housing.
12. The high-point vent system of claim 11, further comprising a third valve connected to the housing above the second valve.
13. The high-point vent system of claim 12, wherein the second valve is connected to a flushing pipe that extends through the housing below the filter, and the third valve is connected to a flushing pipe that extends through the housing above the filter.
14. The high-point vent system of claim 1, wherein the seal comprises a rubber-like element that is received in a recess on the upper end of the float rod.
15. The high-point vent system of claim 14, wherein the rubber-like element seals the seal orifice of the manifold, and wherein a diameter of the seal orifice is at least an order of magnitude smaller than a diameter of the central cavity.
16. The high-point vent system of claim 1, wherein each of the housing, float and filter is cylindrical.
17. The high-point vent system of claim 1 , wherein the housing com prises a plurality of longitudinal sections that are connectable to each other, using threaded joints or other connectors.
18. The high-point vent system of claim 17, wherein a first threaded joint enables the manifold to be threadably removed, exposing the seal.
19. The high-point vent system of claim 17, wherein a second threaded joint, when disconnected, enables removal of the filter and the float.
20. The high-point vent system of claim 1, wherein the filter, float, float rod and manifold are all removably connected to a stub flange positioned at a top end of the housing.
Claims of AU549
1. A vent valve assembly for use in venting excess gas or gas pressure, the vent valve assembly comprising:
a housing defining a hollow central cavity with an in-use upper compartment separated from an in-use lower compartment by a diffuser plate;
the lower compartment having an inlet orifice for receiving influent flow of fluid and the upper compartment comprising an outlet orifice for expulsion of the fluid;
the diffuser plate being provided for allowing upward flow of fluid from the lower compartment to the upper compartment through the diffuser plate;
an upper sealing ball retained in the upper compartment and prevented from passing through the diffuser plate into the lower compartment,
wherein the upper sealing ball is movably disposed to move towards the outlet orifice and form a seal at or adjacent the outlet orifice to prevent expulsion of fluid through the outlet orifice;
wherein the in-use upper compartment further comprises a filter having a hollow structure with upstanding walls extending between a lower open end and an upper open end of the hollow structure wherein the upstanding walls comprise perforations for screening fluid and preventing solid particles from being received into an internal volume of the hollow structure;2. A vent valve assembly in accordance with claim 1 further comprising a lower sealing ball dimensioned to be retained within the lower compartment, the lower sealing ball being movably disposed within the lower compartment to move towards the inlet and orifice and form a seal adjacent the inlet orifice.
3. A vent valve assembly in accordance with claim 1 or claim 2 further comprising a convergent cross-section converging towards the inlet orifice.
4. A vent valve assembly in accordance with any one of the preceding claims wherein the hollow structure comprises a cylindrical cross section.
5. A vent valve assembly in accordance with any one of the preceding claims wherein an upper section of the upstanding walls adjacent the upper end comprises said perforations and wherein a lower section adjacent the lower end is impervious to fluids.
6. A vent valve assembly in accordance with any one of the claims wherein the diffuser plate comprises an outer peripheral portion with a plurality of openings to allow fluid to flow from the lower compartment to the upper compartment.
7. A vent valve assembly in accordance with claim 6 wherein the diffuser plate comprises a radially inner solid portion that is impervious to fluids and solids wherein the inner solid portion is adapted to receive the lower end of the hollow structure such that the lower section of the hollow structure and the inner solid portion of the diffuser plate define a collection chamber to collect fluid screened by the perforations of the cylindrical structure.
8. A vent valve assembly in accordance with claim 7 wherein the inner solid portion of the diffuser plate comprises a drain hole for draining liquid out of the collection chamber.
9. A vent valve assembly in accordance with claim 6 wherein a first section of the peripheral outer portion of the diffuser plate comprises said plurality of openings and wherein a second section of the peripheral outer portion is solid and impervious to flow of liquid.
10. A vent valve assembly in accordance with any one of claims 7 to 9 wherein the inner solid portion comprises a guiding structure to receive and guide the lower end of the hollow structure and seat the lower end of the cylindrical structure along a sealing portion of the diffuser plate thereby forming a seal between the inner solid portion of the diffuser plate and the lower end of the cylindrical structure.
11. A vent valve assembly in accordance with claim 10 when dependent on claim 9 wherein the lower end of the hollow structure comprises a drain hole that is preferably located adjacent the second section of the peripheral outer portion of the diffuser plate.
12. A vent valve assembly in accordance with claim 11 further comprising an alignment mechanism to align the hollow structure of the filter for locating the drain hole adjacent the second arcuate section in a fully engaged configuration.
13. A vent valve assembly in accordance with any one of the preceding claims wherein the diameter of the hollow structure is less than the overall diameter of the upper compartment to define a void volume within the upper compartment that surrounds the upstanding walls of the filter for receiving fluid from the lower compartment through the openings provided in the peripheral region of the diffuser plate.
14. A vent valve assembly in accordance with any one of the preceding claims wherein the upper sealing ball is substantially buoyant in liquid, preferably water and substantially non-buoyant in gas.
15. A vent valve assembly in accordance with any one of the preceding claims wherein the upper compartment comprises one or more draining ports for draining fluid out of the upper compartment.
16. A vent valve assembly in accordance with any one of the preceding claims further comprising a pressure monitoring device positioned within the housing to measure pressure within the internal volume of the upper and lower compartments.
17. A vent valve assembly in accordance with any one of the preceding claims wherein the upper compartment further comprises an upper section that is removably attached to a lower section.
18. A vent valve assembly in accordance with claim 17 wherein the upper section comprises the outlet orifice and wherein the lower section comprises the draining outlet.
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