Inexa, Industria Extractora C. A. v OmniActive Health Technologies Limited
[2013] APO 32
•16 May 2013
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Inexa, Industria Extractora C. A. v OmniActive Health Technologies Limited 2013 APO 32
Patent Application: 2002348718
Title:Novel trans-lutein enriched xanthophyll ester concentrate and a process for its preparation
Patent Applicant: OmniActive Health Technologies Limited
Opponent: Inexa, Industria Extractora C. A.
Delegate: Sophina Calanni
Decision Date: 16 May 2013
Hearing Date: Written submissions filed on 19 December and 21 December 2012
Catchwords: PATENTS – submissions on costs filed after the issue of the substantive decision − costs awarded against unsuccessful party, except in relation to attorney and counsel attendance fees, expenses and allowances
Representation: Patent applicant: John Landells, Griffith Hack, Melbourne
Opponent:Gary Nock, Cullens Brisbane
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2002348718
Title:Novel trans-lutein enriched xanthophyll ester concentrate and a process for its preparation
Patent Applicant: OmniActive Health Technologies Limited
Date of Decision: 16 May 2013
DECISION
I award the costs specified in items 1, 2, 4, 8 and 9 of Schedule 8 against OmniActive Health Technologies Limited.
REASONS FOR DECISION
Background
OmniActive Health Technologies Limited (hereinafter, the Applicant) is the applicant for patent application 2002348718, which claims an earliest priority date of 5 June 2002. The application was advertised accepted on 3 January 2008.
A notice of opposition was served on the Applicant by Inexa, Industria Extractora C. A. (hereinafter, the Opponent) on 3 April 2008. A Statement of Grounds and Particulars was subsequently served by the Opponent on 3 July 2008. This statement was later amended after applications under Regulation 5.9 were made on 3 February 2010, 1 November 2011 and 27 July 2012.
The primary evidentiary stages of the opposition were completed on 24 February 2011 and the matter was set for hearing on 8 November 2011. On 1 November 2011, the Opponent filed a request to serve further evidence and sought a deferral of the hearing pending consideration of their request. Despite submissions by the Opponent the Commissioner was not satisfied that a deferral of the hearing was justified and determined that the request for further evidence would be considered at the hearing.
The hearing was held in Canberra on 8 November 2011 and then reconvened on 1 August 2012. The Opponent did not appear at the hearing of 8 November 2011, nor were any submissions made with regard to the evidence on file at that time.
The Delegate of the Commissioner considered that taking into consideration all relevant aspects of the case, the interests of all parties lay in providing the Opponent with the opportunity to serve further evidence.
Following submissions from the Opponent made after the hearing, a direction was issued specifying reasonable terms on which the application for further evidence may be allowed. The terms set out were as follows:
- That leave to serve further evidence in relation to the issues set out under sections (a)
to (g) in the opponent’s request of 1 November 2011 be granted on appropriate terms, the appropriate terms being that the evidence is filed within 4 weeks of the date of the direction.
- Once the further evidence is filed, that the applicant has 4 weeks to file evidence in response to the further evidence.
- That the hearing be re-adjourned at a date to be determined in February 2012. The hearing will be in relation to the issues not yet covered in the hearing: namely ‘prior user’ and documents in relation to this issue; and costs. This will not be an opportunity to re-visit the issues already discussed at hearing.
- In the event that no evidence is filed, the hearing may be re-adjourned at an earlier time. This will be negotiated with the parties if required.
The Opponent sought, and received, extensions of time under Regulation 5.9 up to 22 March 2012. The further evidence was completed on 22 March 2012. The Applicant did not file evidence in response to the further evidence.
Prior to the reconvened hearing, the Opponent filed a further amended Statement of Grounds and Particulars on 27 July 2012 to confine the opposition to claims 1-4, 14 and 15 only.
The Delegate in his decision dated 23 November 2012, [2012] APO 128, found that the opposition was successful on the grounds of novelty and inventive step. Claims 1, 2, 4 and 14 were found to lack novelty, and Claims 1 to 4, 14 and 15 were found to lack an inventive step.
10. With regard to costs, the Applicant sought its costs in the matter while the Opponent reserved its position on costs dependent on the outcome of the opposition. On this basis the parties were allowed 1 month from the date of the decision to make submissions in relation to costs. Both parties have now each filed written submissions.
SUBMISSIONS
11. In the written submissions dated 19 December 2012, the Applicant has stated that their primary position is that the Applicant seeks costs from the Opponent. They have stated:
“The Patent Applicant seeks costs from the Opponent. Factors weighing in favour of this request include the opponent’s lack of diligence in handling the opposition (and delay) that required a re-adjourned hearing, as noted by the Delegate in his decision, and in view of the Delegate’s decision to uphold the validity of the process claims 5-13.
The original (first) Hearing was set down for 12 September 2011, as advised by the Commissioner well in advance of this date on 7 March 2011 (6-months prior to the Hearing). This first Hearing was then rescheduled on request of the opponent on the reasoning that a later first Hearing date was required to suit availability of its counsel. The Opponent put forward to the Patent Applicant a date for the rescheduled first Hearing that particularly suited the Opponent and its counsel. ...The first Hearing was then rescheduled by a number of months. Only a few days before the rescheduled Hearing of 8 November 2011, the opponent then sought another rescheduling of the first Hearing. The Delegate made a decision to continue with the 8 November 2011 rescheduled first Hearing and to consider any specific further requests by the Opponent at that Hearing
.On the morning of the rescheduled first Hearing of 8 November 2011, after the attorney and counsel for the Patent Applicant had travelled to Canberra for the Hearing and had just arrived at the Australian Patent Office, a fax notification was received from the Opponent advising they would not be appearing at the hearing. Further, the Opponent did not even appear by way of teleconference, neither by its representing attorney or counsel, to support any position including any further specific requests.
The first Hearing proceeded, although the Delegate made a decision to provide additional time to the Opponent to submit further prior user evidence in support, and contingent on this would allow a second Hearing to consider any further prior user evidence submitted. ... The Delegate noted that the Opponent lacked diligence and its actions were not consistent with a serious opposition.
In view of the above extenuating circumstances, the Patent Applicant requests an award of all costs in relation to the full oppositions proceedings. If a decisions is made not to award to the Patent Applicant all costs from the Opponent, then in the alternative the Patent Applicant requests an award of all costs from the Opponent at least in relation to the re-adjourned Hearing (second Hearing of 1 August 2012), with parties otherwise bearing its own costs in relation to preceding matters. If a decision is made not to award to the Patent Applicant all costs in relation to the re-adjourned second Hearing, then in a further alternative the Patent Applicant requests that each party bear its own costs in relation to all matters.”
12. The Opponent has submitted that the usual order that cost should follow the event should be made. That is, that costs should be awarded against the Applicant. They have submitted that an alternative arrangement may be that the Applicant is entitled to some costs in relation to the hearing on 8 November 2011. The Opponent has stated:
“At the re-convened hearing, the opponent made it clear that it would only be pressing its case in relation to the product claims. Following the reconvened hearing, the Delegate issued his decision that found that all product claims were either not novel or did not involve an inventive step. Thus, the opponent has been successful. Accordingly, we submit that the opponent is entitled to its costs in this matter, including costs associated with preparing evidence and attending the re-convened hearing.
If the hearing officer is of the view that the applicant should be entitled to some costs for its attendance at the hearing on 8 November 2011, we submit that the appropriate order to make will be as follows:
1)Make an award of costs against the applicants in respect of the matter is set out in items 1, 2, 4, 8 and 9, and, insofar as they related to the reconvened hearing on 1 August 2012, making an award of costs against the matters against the applicant in respect of the matters set out in items 11, 13 and 14 of Schedule 8 (including expenses and allowances);
2)Make an award of costs against the opponent, insofar as they relate to the hearing on 8 November 2011, in respect of the matters set out at items 13 and 14 of schedule 8 (including expenses and allowances).”
DISCUSSION
13. The Commissioner’s powers to award costs arises from Section 210 of the Patents Act 1990 which provides:
The Commissioner may, for the purposes of this Act:
(a) summon witnesses; and
(b) receive written or oral evidence on oath or affirmation; and
(c) require the production of documents or articles; and
(d) award costs against a party to proceedings before the Commissioner.”
14. As the power to award costs is discretionary, I must take into account all relevant considerations (see American National Can Co. v W.R. Grace & Co.-Conn [1994] APO 29; (1994) AIPC 91-063; 29 IPR 292).
15. In addition, Patents Regulations 22.8 states that:
"(1)The Commissioner must not award costs in proceedings to which this Division applies, other than costs specified in Schedule 8 unless each party to the proceedings has had the reasonable opportunity to make a submission on the matter of the award of those costs.
(2)The Commissioner may award an amount:
(a)for costs in respect of a matter specified in column 2 of an item of Part 1 in Schedule 8; or
(b)in respect of the expenses or allowances of a person in relation to proceedings to which this Division applies."
16. Both parties have provided submissions with regard to the matter of costs, therefore I am satisfied that the conditions set out in Patents Regulations 22.8(1) have been met.
17. The Delegate in his decision found that the opposition was successful on the grounds of novelty and inventive step. Claims 1, 2, 4 and 14 were found to lack novelty, and Claims 1 to 4, 14 and 15 were found to lack an inventive step.
18. The usual practice of costs following the event would lead me to awarding costs against the applicant. However, this usual practice may be displaced where the conduct of the successful party is calculated to occasion unnecessary expense (see Keddie v Foxall (1955) ALR 835, the note in 30 ALJ 27). Such conduct may include conduct in and leading up to proceedings taken into account when considering an award of costs (see Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at [67]-[69]).
19. In the present circumstances, the Opponent introduced further evidence into the proceedings at a late stage. As noted by the Delegate in his decision “Prima facie the opponent had ample time to consider the evidence and prepare and serve relevant further evidence well before 1 November 2011. The failure to do so indicates a lack of diligence that was not consistent with a serious opposition.” In addition, with regard to the hearing set down for 8 November 2011, the Opponent only advised the Office that they would not be appearing at the hearing on 7 November 2011. This was despite receiving correspondence from the Supervising Examiner, Patent Oppositions, Hearings and Legislation indicating that a deferral of the hearing was not justified, and that the request for further evidence would be considered as part of the substantive hearing scheduled for 8 November 2011.
20. I consider these actions by the Opponent unnecessarily protracted the proceedings and resulted in the Applicant incurring unnecessary expense and inconvenience, particularly with regard to the hearing on 8 November 2011. Accordingly, with regard to the hearing on 8 November 2011, I consider it appropriate to award costs against the Opponent where those costs relate to items 11, 13 and 14 of Schedule 8 (including expenses and allowances as set out in Part 2, Division 1 of Schedule 8).
21. Turning to the re-convened hearing of 1 August 2012, as stated earlier, the opposition was successful on the grounds of novelty and inventive step. I note that in this regard the Opponent relied significantly on the evidence adduced as further evidence after the hearing on 8 November 2011. I therefore consider that it is appropriate to award costs associated with preparing evidence and attending the re-convened hearing against the Applicant.
22. While the overall costs, expenses and allowances for attendance at the hearing by the registered patent attorney and counsel (as specified by items 13 and 14, and Part 2, Division 1 of Schedule 8) are not likely to be the same for each of the hearing dates, I consider these costs are largely offsetting. Thus, in terms of the complete hearing I consider it appropriate to exclude an award of costs of costs for items 13 and 14 (including expenses and allowances as specified in Part 2, Division 1 of Schedule 8).
23. As a consequence, I award the costs as specified in items 1, 2, 4, 8 and 9 against OmniActive Health Technologies Limited.
Sophina Calanni
Delegate of the Commissioner of Patents
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