Innovia Security Pty Ltd v Giesecke & Devrient GmbH - [2014] APO 78

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Innovia Security Pty Ltd v Giesecke & Devrient GmbH [2014] APO 78

Patent Application: 2006215783

Title:Security element and method for the production thereof

Patent Applicant:                   Giesecke & Devrient GmbH
Opponent:  Innovia Security Pty Ltd
Delegate:  Greg Powell
Decision Date:  27 November 2014
Hearing Date:  4 September 2014

Catchwords: PATENTS - section 59 – opposition to the grant of a patent – request for leave to file further evidence – further evidence not necessary – leave refused –whether the claimed invention is novel – lack of novelty not established – whether the claimed invention involves an inventive step – lack of inventive step not established on evidence filed – whether the claims are clear and fairly based – claims clear and fairly based – opposition unsuccessful – costs awarded against the opponent.

Representation: Patent applicant: Claude Anese, Patent attorney of Cullens, Brisbane
Opponent:J Roger Green and Ken Bolton, Patent attorneys of Watermark, Melbourne

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2006215783

Title:Security element and method for the production thereof

Patent Applicant: Giesecke & Devrient GmbH
Date of Decision: 27 November 2014
DECISION
The opposition is unsuccessful.
Costs are awarded against Innovia Security Pty Ltd.
REASONS FOR DECISION
Background

Application 2006215783 in the name of Giesecke & Devrient GmbH (“Giesecke”) was filed on 10 February 2006 and accepted on 16 November 2010. Securency International Pty Ltd filed a Notice of Opposition on 9 March 2011. Securency International Pty Ltd subsequently changed its name to Innovia Security Pty Ltd (“Innovia”). The evidence in support of the opposition was completed on 25 May 2012. Giesecke did not file any evidence in answer.
The specification has been amended twice since acceptance. The first request to amend was filed on 20 January 2011, prior to the Notice of Opposition being filed. These amendments were allowed unopposed on 16 May 2011. A second request for amendments was filed on 5 December 2012, following completion of the evidence in support. These amendments were allowed unopposed on 18 June 2013.
The Opposition
Innovia opposed the grant of a patent on the basis of:
(i)lack of novelty
(ii)lack of inventive step
(iii)non-compliance with section 40(3)
Evidence in support consists of three declarations as follows:
(i)Michael Christopher Hutley with exhibits MCH-1 to MCH-4;
(ii)Robert Andrew McMaster with exhibits RAM-1 to RAM-7; and
(iii)Bruce Alfred Hardwick with exhibits BAH-1 to BAH-40
I will refer to the relevant parts of the evidence where appropriate.
The Specification
The present invention relates to a security element for protecting valuable articles. The specification notes that, to prevent reproduction of the security elements even with top-quality colour copiers, security elements exhibit many optically variable effects so that, from different viewing angles, the element presents to the viewer a different image impression and show. For example the element may show a different colour or different graphic.
The specification describes prior approaches such as:
- the use of conventional embossed holograms or gratings which have viewing-angle-dependent colours;
- diffraction optical structures with which lettering or a pattern is visible in transmitted light; or
- “2D/3D holograms”, having a two-dimensional diffraction pattern superimposed on a three-dimensional hologram.
The specification notes that since holograms are used for decorative purposes as well, viewer awareness of holograms as security elements is diminishing. The specification also notes that the image created in this way can be perceived only from preferred viewing directions and under certain lighting conditions. The specification states that, with poor lighting conditions, the perceptibility of the holographically produced motif is greatly restricted.
The specification also notes that it is known to use lens systems as security features. The specification describes these as comprising a surface having an embossed grid of multiple parallel cylinder lenses on one side and on an opposing surface, which is approximately the focal length of the lenses distant, a printed image in register with the lenses. Depending on the viewing angle via the lenses, different sub-areas of the image are visible. However, if the document that carries this security feature is turned on an axis that is parallel to the lens axis, the effect is reduced.
The preferred object of the present invention is stated to be to “specify a generic security element having high counterfeit security that avoids the disadvantages of the background art”. This is achieved according to the specification firstly by the use of a security element that has two authenticating features. The first feature is a plurality of lenses that are present in a first grid, and a second arrangement having a plurality of microscopic structures that are present in a second grid. The first and second arrangements are disposed in such a way that the spatial frequencies of the two grids differ slightly and, as a result of a moiré effect, the microscopic structures of the second arrangement are seen magnified when viewed through the focusing elements of the first arrangement. This moiré magnification is a well-known effect where the slight differences in the spatial frequencies of the individual lenses and structures results in images from each lens which “add up” to produce a magnified view of the microstructures.
The second feature is a coating that is applied to some of the microstructures in the form of characters, patterns or codes. This feature is not (and does not need to be) magnified by the lenses of the first authenticating feature.
The invention is best illustrated in Figures 7 and 8 which are as follows:
Figure 8 represents what is seen when the security element of figure 7 is viewed from above. The microstructures 166 are magnified via the moiré effect. Coated over the microstructures 166 is a layer 15 (not shown in figure 7) which has openings 30 in it. Together the coating and openings form another readable element (the letter “B” in this embodiment).
The specification ends with 24 claims (as amended) as follows:
1. A security element for protecting valuable articles, having at least one first authenticating feature, the first authenticating feature comprising a first arrangement having a plurality of lens-shaped focusing elements that are present in a first grid, and a second arrangement having a plurality of microscopic structures that are present in a second grid, the first and the second arrangements being disposed in such a way that the spatial frequencies of the two grids differ slightly and, as a result of a moiré effect, the microscopic structures of the second arrangement are seen magnified when viewed through the lens-shaped focusing elements of the first arrangement, and a second authenticating feature that is visually verifiable and is not magnified by the first arrangement of the first authenticating feature, wherein the microscopic structures of the second arrangement of the first authenticating feature comprise embossed microstructures that are coated with a metal reflection layer that provides the second authenticating feature and that exhibits apertures in the form of characters, patterns or codes, or is developed in the form of characters, patterns or codes, and wherein the magnification effect of the lens-shaped focusing elements of the first arrangement does not relate to the second authenticating feature.
1. The security element according to claim 1, characterized in that the first and second grid of the first authenticating feature each exhibit fixed geometric relationships.
1. The security element according to claim 1 or 2, characterized in that the first grid and the second grid of the first authenticating feature exhibit a slightly differing line screen spacing.
1. The security element according to claim 1, characterized in that the first grid and the second grid of the first authenticating feature exhibit a substantially identical line screen spacing and are disposed slightly rotated against one another.
1. The security element according to any one of claims 1 to 4, characterized in that the line screen spacing of the first and second grid lies between 3 μm and 50 μm.
1. The security element according to any one of claims 1 to 5, characterized in that the second authenticating feature comprises a machine-readable layer.
1. The security element according to claim 6, characterized in that the machine-readable layer includes machine-readable feature substances, especially reflecting, magnetic, electrically conductive, polarizing, phase shifting, phosphorescent, fluorescent or other luminescent substances.
1. The security element according to any one of claims 1 to 7, characterized in that the first and second arrangement of the first authenticating feature are disposed in such a way that the focusing elements of the first arrangement and the embossed microstructures of the second arrangement are developed as elevations that point in the same direction.
1. The security element according to any one of claims 1 to 8, characterized in that the embossed microstructures comprise elements that are present in the form of spherical or aspherical caps, cones, triangular pyramids, trapezoidal pyramids, truncated cones, truncated pyramids or the like, and/ or exhibit a base area in the form of characters, patterns or codes.
1. The security element according to any one of claims 1 to 9, characterized in that the embossed microstructures are embossed in a colored embossing lacquer.
1. The security element according to claim 10, characterized in that the colored embossing lacquer is a radiation-curing lacquer containing color pigments.
1. The security element according to any one of claims 1 to 11, characterized in that the embossed microstructures are disposed on a colored carrier substrate.
1. The security element according to any one of claims 10 to 12, characterized in that the embossed microstructures on the structured side of the second arrangement are provided with an opaque coating.
1. The security element according to any one of claims 1 to 13, characterized in that the focusing elements of the first arrangement have circular or elliptical base areas.
1. The security element according to any one of claims 1 to 14, characterized in that the embossed microstructures of the second arrangement have circular or elliptical base areas.
1. The security element according to any one of claims 1 to 15, characterized in that the first arrangement comprises a combination of focusing elements of differing size and line screen spacing.
1. The security element according to any one of claims 1 to 16, characterized in that the focusing elements of the first arrangement and/ or the microscopic structures of the second arrangement are disposed on a carrier substrate
1. The security element according to any one of claims 1 to 17, characterized in that a spacing layer and/ or an adhesive layer is provided between the focusing elements of the first arrangement and the microscopic structures of the second arrangement.
1. The security element according to any one of claims 1 to 18, characterized in that the focusing elements of the first arrangement are provided with a protective layer, the protective layer exhibiting a refractive index that differs from the refractive index of the focusing elements by at least 0.3.
1. The security element according to any one of claims 1 to 19, characterized in that the security element exhibits a total thickness of less than 50 μm.
1. The security element according to any one of claims 1 to 20, characterized in that the security element is a security thread, a tear strip, a security band, a security strip, a patch or a label for application to a security paper, value document or the like.
1. The security element according to any one of claims 1 to 21, wherein the second authenticating feature is machine and visually verifiable.
1. The security element according to claim 5, wherein the line screen spacing is between 5 μm and 35 μm.
1. The security element according to claim 5, wherein the line screen spacing is between 10 μm and 20 μm.
Further evidence
At the hearing Innovia opened their submissions by giving to me a purported translation of two German patent applications; DE 102005007749.8 (“first priority document”) and DE 102005028162.1 (“second priority document”), being the priority documents of the present application. Innovia indicated that they had been supplied because it was Innovia’s submission that the claims as amended were not fairly based on either priority document, or at least not on the first priority document, which provides the earliest priority date. The priority date is important as it determines whether the two documents used as “whole of contents” novelty citations can be used as an inventive step citation. As such, before deciding the opposition it is necessary to address the issue of further evidence.
I indicated at the hearing that the translations were not in evidence. I also indicated that the priority documents were not in evidence. Innovia submitted that, as the priority documents were available from the PatentScope website managed by WIPO, I was permitted to retrieve a copy from that website. I stated that the availability of documents from other locations did not alter the fact that the documents were not in evidence.
While I permitted the hearing to proceed and permitted Innovia to make submissions on the ground of inventive step as if that the priority claims were not valid, I asked that Innovia make a formal request for leave to file further evidence following the hearing. I stated that I would consider the priority documents and determine whether the priority date was “in peril”. I stated that, if the priority date was in peril, then I would grant leave to file the further evidence and provide Giesecke with an opportunity to provide evidence in response and make further submissions in relation to inventive step with respect to the two novelty citations since this was clearly not part of the case set out in Innovia’s Statement of Grounds and Particulars.
I took this course despite the fact that I am of the opinion that the explanation of the delay in providing this further evidence supplied by Innovia at the hearing was manifestly deficient. In my opinion, the public interest would support the inclusion of the evidence if it was shown to be of relevance.
The principle reason that Innovia states that the claims are not entitled to at least the earliest priority date relies on the feature of claim 1 which states:
“wherein the magnification effect of the lens-shaped focusing elements of the first arrangement does not relate to the second authenticating feature”
Specifically, Innovia submits that there is no support in either priority document for the phrase “does not relate to”. Innovia submitted that the application as filed simply mentions that the second authenticating feature is not influenced by the magnification effect and does so in relation to describing a method of producing a security element. Innovia pointed out that the translation of the second priority document mentions that the second authenticating feature was not “influenced by” the magnification effect of the first authenticating element, but does not state that it does not “relate to” the magnification effect. Innovia also submitted that the translation of the first priority document has no reference to the second authenticating feature not being “influenced by” (let alone “related to”) the magnification effect of the first authenticating element.
Giesecke submitted that the test for priority is whether the claim is fairly based on the disclosure of the priority document, not the translation. Giesecke submitted that there were nuances in language and, as such, it was important to interpret the translation in the context of the description. Giesecke submitted that when determining whether the claim was fairly based on the priority document, it was important to take the context into account. In their opinion, the context made it clear that it was different words saying the same thing.
Under Section 40(3), fair basis is “concerned purely with the relationship between the body and claims of the one specification.” (Lockwood Security v Doric Products [2004] HCA 58; 217 CLR 274; 212 ALR 1; 79 ALJR 260). As was noted in Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty Ltd [2001] HCA 8; 207 CLR 1; 177 ALR 460; 75 ALJR 518 “a comparison between the matter described in the specification and the claim which defines the scope of the monopoly”, following the reasoning of Barwick CJ in Olin Corporation v Super Cartridge Co Pty Ltd [1977] HCA 23; (1994) 180 CLR 236 when he said:
“The question whether the claim is fairly based is not to be resolved ... by considering whether a monopoly in the product would be an undue reward for the disclosure. Rather, the question is a narrow one, namely whether the claim to the product being new, useful, and inventive, that is to say, the claim as expressed, travels beyond the matter disclosed in the specification.”
As was noted in Lockwood (supra):
“the statutory test as expounded by Barwick CJ does not call for any evaluation of whether the breadth of the claims exceeds "the technical contribution to the art embodied in the invention", merely for an evaluation of whether the claims travel beyond the matter described in the specification”
I also note that it was said in Rehm Pty Ltd v Websters Security Systems (International) Pty Ltd [1988] FCA 162 at [54]:
“The circumstance that something is a requirement for the best method of performing an invention does not make it necessarily a requirement for all claims; likewise, the circumstance that material is part of the description of the invention does not mean that it must be included as an integer of each claim. Rather, the question is whether there is a real and reasonably clear disclosure in the body of the specification of what is then claimed, so that the alleged invention as claimed is broadly, that is to say in a general sense, described in the body of the specification”
This was cited with approval in Lockwood.
It is understood that these principles also apply when determining whether there is fair basis for the claims in the priority document.
The specification clearly discloses that the second authenticating feature is not magnified by the lenses of the first authenticating feature. This is evident throughout the specification. The figures in particular clearly show a coating that extends across at least some of the microstructures and that there are apertures in the coating where the microstructures are uncoated (see figures 2a, 3, 5, 6 and 11 for example). The figures show the microstructures being magnified while the coating and apertures of the second authenticating feature remain unaffected. The description also makes it very clear that the magnification is purely a moiré effect and that the coating is not magnified by the moiré effect. I note that the description at page 20, lines 11–14 when discussing figure 4 clearly states:
“The described magnification effect of the microlenses 112 of the first lens arrangement 12 relates only to the microlenses 116 disposed in a grid in the second lens arrangement 16, and not to the piece of information produced by the apertures 30 in the metal layer 15.” (my emphasis)
Note that the microlenses 116 spoken of here are equivalent to the microstructures 166 shown in figure 8 which is produced earlier in this decision.
I note the use of the word “relates” in this passage. I also note that the passage states that the magnification effect relates only to the microlenses. It follows, as I have emphasised, that the magnification effect does not relate to the “information produced by the apertures 30 in the metal layer 15”; that is the second authenticating feature. This appears to be what claim 1 defines.

Moreover, when discussing figure 8 (which is clearly analogous to figure 4), the description states at page 23 line 24–page 24 line 3:
“The three-dimensional effect of the embossed microscopic structures described is created by the arrangement of the microscopic structures in a grid, regardless of whether the microscopic structures as such are already three-dimensional. In contrast, the piece of information produced by the aperture 30 in the metal layer 15 and extending across a plurality of microlenses 112 is not present in a regular grid. Thus, it appears to the viewer merely as a two-dimensional image in original size that appears to be disposed on the three-dimensional, magnified image of the embossed microscopic structures.” (my emphasis)
It is clear from this passage that the second authenticating feature is not magnified. To my mind claim 1 is fairly based on the description. Moreover, while the description occasionally uses the word “influence”, it is apparent that this means that the magnification occurring does not affect the second authenticating feature. The question then remains whether the first priority document discloses this feature.
The answer is clearly “Yes”. The passage from page 20 quoted above appears in the translation of the first priority document supplied by Innovia at page 15 line 35–page 16 line 2. The passage from pages 23 and 24 quoted above appears in the translation at page 19 lines 10–22. It follows that claim 1 is fairly based upon the first priority document.
Consequently, there is no public interest in having the further evidence on file. The priority date of the claim does not change whether it is part of the evidence or not part of the evidence. It must also be borne in mind that, if I were to grant leave to file the further evidence, I would, following long-established practice, give Giesecke a period of time to file responding evidence. While, in my opinion, there would be no need for Giesecke file any evidence in response, I would, nevertheless, have to give that opportunity. That would introduce an unnecessary delay. Given these considerations, I refuse leave to file further evidence.
I note that Innovia in their letter accompanying their request for leave to file further evidence state that claims 10-12 are not entitled to the priority date of the first priority document since there is no disclosure of the microstructures being formed in, or disposed on, a coloured carrier. This is of no consequence, given my conclusions with respect to novelty, and does not change my deliberations with respect to the further evidence in any way.
DECISION
Onus of proof
The examination request for this patent application was filed on 10 July 2009. As a consequence, substantive amendments of the Patents Act brought about by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 do not apply to the present application. This includes the amendment to subsection 60 (3A) that allows the Commissioner to refuse a patent application if satisfied on the balance of probabilities that a ground of opposition exists.
Consequently the former standard for opposition proceedings applies and the opponent must establish that it is clear or practically certain that the patent is invalid (F Hoffman La Roche AG v New England Biolabs Inc [2000] FCA 283 at [29], [67]; [2000] FCA 283; 50 IPR 305 at 311, 319; Commissioner of Patents v Sherman [2008] FCAFC 182 at [18], [22]; [2008] FCAFC 182; 79 IPR 426; Genetics Institute Inc v Kirin-Amgen Inc [1999] FCA 742; [1999] 92 FCR 106 at [17]).
The weight of evidence
This opposition only has evidence in support. Nevertheless, Giesecke submitted that the evidence of Dr Hutley and Dr Hardwick was simply establishing what was known to only them. It was largely subjective and was not enough to establish the knowledge of the person skilled in the art.
I have difficulty in accepting Giesecke’s argument. It is true that statements made by declarants may not be followed by the decision maker, be it a court or otherwise. However, that is a matter of weight. It is not a matter of the opinion being rejected simply because it is one person’s opinion.
I note that section 76(1) of the Evidence Act 1995 states:
“(1)Evidence of an opinion is not admissible to prove the existence of a fact about the existence of which the opinion was expressed”
This rule, known as the “opinion rule”, in this form would seem to support Giesecke’s position.
However, the rule is qualified by section 79. Section 79(1) states:
“(1)If a person has specialised knowledge based on the person’s training, study or experience, the opinion rule does not apply to evidence of an opinion of that person that is wholly or substantially based on that knowledge”
Clearly, the opinion of an expert can be taken to be proof of “the existence of a fact about the existence of which the opinion was expressed” (as per s 76). I accept that the Commissioner is not a court and, therefore, is not bound to follow the rules of evidence, but I can see no reason why the principles of section 76 and 79 of the Evidence Act should not be applied by the Commissioner when assessing evidence. In the present case, I accept, and it was not disputed in any way by Giesecke, that Drs Hutley and Hardwick are people skilled in the art. Consequently, they are people with “specialised knowledge based on the person's training, study or experience” who is able to give an opinion as to a fact “based on that knowledge”. I accept what Drs Hutley and Hardwick have to say about the art subject to any other, contradicting considerations that may be present. While there is no evidence from Giesecke which contradicts the opinions of Drs Hutley and Hardwick in any way, there may be other considerations that must be taken into account and weighed against that evidence.
Novelty
Innovia relied upon three documents for the ground of novelty as follows (document numbering is that used by Innovia):
(i)      WO 2005/052650 (D1)
(ii)     WO 2005/106601 (D2)
(iii)   US 5712731 (D3)
It is a requirement of subsection 18(1) of the Patents Act (the Act) that the invention, so far as claimed in any claim, is novel. Subsection 7(1) states that an invention is taken to be novel unless it is not novel in the light of the prior art. A citation is part of the prior art base for the purposes of novelty if it was published before the priority date of the claim, or, as is the case for D1 and D2, information in an Australian patent specification which was published after the priority date where the information has an earlier priority date than the priority date of the claim.
It is well established that the general test for lack of novelty is the reverse infringement test. The classic formulation of this test is that given by Aickin J in Meyers Taylor Pty Ltd v Vicarr Industries Ltd [1977] HCA 19 at [20], 137 CLR 228 at 235:
“The basic test for anticipation or want of novelty is the same as that for infringement and generally one can properly ask oneself whether the alleged anticipation would, if the patent were valid, constitute an infringement”.
This test is satisfied if the alleged anticipation discloses all the essential features of the invention as claimed (see Nicaro Holdings Pty Ltd v Martin Engineering Co (1990) 91 ALR 513 at 517). In order to meet this requirement, the prior art must "contain clear and unmistakeable directions to do what the patentee claims to have invented" (The General Tire & Rubber Company v The Firestone Tyre and Rubber Company Limited [1972] RPC 457 at 486).
In AstraZeneca AB v Apotex Pty Ltd [2014] FCAFC 99 it was noted (at [293]–[294]):
“The touchstone for determining whether a prior publication … anticipates a claimed invention, is stated in General Tire at 485 to 486:
When the prior inventor’s publication and the patentee’s claim have respectively been construed by the Court in the light of all properly admissible evidence ... the question whether the patentee’s claim is new ... falls to be decided as a question of fact. If the prior inventor’s publication contains a clear description of, or clear instructions to do or make, something that would infringe the patentee’s claim if carried out after the grant of the patentee’s patent, the patentee’s claim will have been shown to lack the necessary novelty, that is to say, it will have been anticipated. The prior inventor, however, and the patentee may have approached the same device from different starting points and may for this reason, or it may be for other reasons, have so described their devices that it cannot be immediately discerned from a reading of the language which they have respectively used that they have discovered in truth the same device; but if carrying out the directions contained in the prior inventor’s publications will inevitably result in something being made or done which, if the patentee’s patent were valid, would constitute an infringement of the patentee’s claim, this circumstance demonstrates that the patentee’s claim has in fact been anticipated.
If, on the other hand, the prior publication contains a direction which is capable of being carried out in a manner which would infringe the patentee’s claim, but would be at least as likely to be carried out in a way which would not do so, the patentee’s claim will not have been anticipated, although it may fail on the ground of obviousness. To anticipate the patentee’s claim the prior publication must contain clear and unmistakable directions to do what the patentee claims to have invented ... a signpost, however clear, upon the road to the patentee’s invention will not suffice. The prior inventor must be clearly shown to have planted his flag at the precise destination before the patentee.
The metaphor of planting the flag has been taken up in this Court. For example, in ICI Chemicals, the Full Court at [51], after noting the metaphor, remarked that, in that case, the appellant’s argument involved the skilled addressee rummaging through a “flag locker” to find a flag which the prior art document possessed and could have planted. In Apotex Pty Ltd and Another v Sanofi-Aventis and Another [2008] FCA 1194; (2008) 78 IPR 485 (“Sanofi-Aventis (2008)”), Gyles J at [91] adopted a different metaphor, remarking that “anticipation is deadly but requires the accuracy of a sniper, not the firing of a 12 gauge shotgun”. Each metaphor underlines the importance of the specificity required in order for a prior art document to anticipate an invention as claimed.” (my emphasis)
I will discuss the citations in reverse order.
D3 – US 5712731
There is no dispute that D3, published on 27 January 1998, is part of the prior art base that can be considered when assessing novelty.
D3 discloses the provision of lens-shaped focussing elements 4 present in a first grid and a plurality of printed microimages 2 present in a second grid. The spatial frequencies of each grid differ slightly so that when the microimages are viewed through the lenses a magnified view of the microimages is seen via the moiré magnification effect. Innovia submitted that this formed a first authenticating feature. Innovia then pointed to the fact that D3 disclosed the formation of a hologram and submitted that this formed the second authenticating feature. There are a couple of problems with Innovia’s position.
Firstly, in the embodiments in D3 which discuss moiré magnification, the microimages are not embossed. Instead, for those embodiments discussed in D3 that use microimages, they are printed. While printing and embossing may end up at more or less the same place (i.e. a layer having some sort of surface relief structure), they are not the same thing.
Secondly, the claims require that the second authenticating feature is made from a metal reflection layer coated on the embossed microstructures that form the microimages. This is not disclosed in D3. As noted by Dr Hardwick in his evidence, there is certainly discussion of other embodiments which have holograms coated with metal reflection layers. However, Dr Hardwick simply points to various locations in D3 where he sees the feature being disclosed. I cannot see any disclosure that would lead the person skilled in the art to somehow combine the features from the different embodiments in D3 to, possibly, arrive at the features of the claims. Giesecke submitted that taking features from different embodiments was impermissible. I agree. Unless there is evidence that the person skilled in the art would take this as being the case, the “specificity required in order for a prior art document to anticipate an invention as claimed” (AstraZenca (supra)) is missing. The evidence from Innovia simply does not address this. Nevertheless, I do note the evidence of Dr Hutley at [53] where he states:
“When comparing the Moiré magnification arrangement described in claim 1 to what is described in [D3], the only difference I am able to discern is the addition of this second feature. Furthermore, the result that an overprinted second image, being positioned over the image array, is seen unaffected by the moiré magnification effect is a result that would be entirely expected by a person having knowledge of the operation of moiré magnifiers …”
While Dr Hutley states that the effect is expected, that is not the same thing as saying that the feature is disclosed.
The claims do not lack novelty in light of D3.
D2 – WO 2005/106601
D2 has been raised as a “whole of contents” novelty citation, unless it is found that the present claims are not entitled to their priority date. Given my conclusion above with respect to the priority date of the claims, D2 remains a “whole of contents” citation.
Like D3, D2 discloses the provision of lens-shaped focussing elements 3 present in a first grid and a plurality of embossed microscopic structures 4 present in a second grid. The spatial frequencies of each grid differ slightly. Crucially, the microscopic structures of D2 are anti-reflective “moth-eye” structures which are coated with a reflective metal layer. When the microscopic structures are viewed through the lenses, a magnified view is seen which is composed of areas where the light is reflected and areas where the light is not reflected. D2 also discloses the formation of “demetallised indicia” by the removal of the reflective metal layer in certain regions. However, notwithstanding Innovia’s submissions, there are, again, two problems with D2.
Firstly, claim 1 requires that:
“the microscopic structures … are seen magnified when viewed through the lens-shaped focusing elements” (my emphasis)
As noted above, the microscopic structures of D2 are anti-reflective. That is, as was noted by Giesecke in their submissions, what is magnified in D2 is an outline of an area where there are microscopic structures. The microscopic structures themselves are not seen. Innovia sought to explain this by equating the shaped formed by the anti-reflective microstructures to be the microstructure required by the claims. I do not believe that this falls within the scope of the claims. The claims (and description) make it clear that it is the actual embossed microstructures that are seen. Innovia admitted during the hearing that a user of the invention of D2 would not see the actual embossed microstructures. Instead the existence of such structures could be inferred, if the user knew how the effect was produced. This is not the same thing as is claimed.
Secondly, while D2 discloses forming “demetallised indicia”, D2 does not disclose what would be seen. Noting that in the figures of D2 some of the metallised areas overlap the anti-reflective structures while others of the anti-reflective structures are not coated with a metal layer, there is no clear and unmistakeable disclosure of a feature that is visually verifiable and is something that is in the form of “characters, patterns or codes”. What effect the metallised and non-metallised anti-reflective structures have on this metal layer is simply not discussed. While D2 talks about “indicia” and refers to EP 319157, which discloses demetallised areas forming characters and the like, EP 319157 does not have the added complexity of the metallised/demetallised layer over‑laying anti-reflective structures. Even assuming that D2 discloses something which is visually verifiable, I cannot be satisfied that D2 discloses this feature.
The claims do not lack novelty in light of D2.
D1 – WO 2005/052650
D1 has been raised as a “whole of contents” novelty citation, unless it is found that the present claims are not entitled to their priority date. Given my conclusion above with respect to the priority date of the claims, D1 remains a “whole of contents” citation.
D1 represents the closest prior art document raised by Innovia. It discloses the provision of lens-shaped focussing elements 1 present in a first grid and a plurality of microscopic structures 4 (called “image icons”) present in a second grid. The spatial frequencies of each grid differ slightly. When the image icons are viewed through the lenses, magnified images of the icons are seen. Similar to the situation with respect to D2 and D3, there are a number of problems with D1.
Firstly, the claims require the microstructures to be embossed. Innovia pointed to particular passages in D1 which they indicated showed that the microstructures were embossed. Page 30 line 17 to page 31 line is one which, when discussing ways of forming the microimages, states inter alia:
“… Icon element 4 is one element of a periodic array of icon elements having periods and dimensions substantially similar to those of the lens array including lens 1. Between the lens 1 and the icon element 4 is an optical spacer 5, which may be contiguous with the lens 1 material or may optionally be a separate substrate 8 – in this embodiment the lenses 9 are separate from the substrate. The icon elements 4 may be optionally protected by a sealing layer 6, preferably of a polymer material.”
Innovia also pointed to page 30 line 17 to page 31, line 13, discussing ways to form the microimages in another embodiment, which states inter alia:
“Figure 7a depicts… Icon elements 108 … formed by patterns of colorless, colored, tinted, or dyed material applied to the lower surface of optical spacer 5. Any of the multitude of common printing methods, such as inkjet, laserjet, lettepress, flexo, gravure, and intaglio, can be used to deposit icon elements 108 of this kind so long as the print resolution is fine enough.
Fig. 7b depicts a similar material system with a different embodiment of icon elements 112. In this embodiment the icon elements are formed from pigments, dyes, or particles embedded in a supporting material 110.
Fig. 7c depicts a microstructure approach to forming icon elements 114. This method has the benefit of almost unlimited spatial resolution. The icon elements 114 can be formed from the voids in the microstructure 113 or the solid regions 115, singly or in combination. The voids 113 can optionally be filled or coated with another material such as evaporated metal material having a different refractive index, or dyed or pigmented material. …”
Dr Hardwick in his evidence pointed to page 68 which mentions “extrusion embossing” and “soft embossing”, as well as claims 20 and 66 which mention the image icons are formed as recesses in a substrate and filled with an evaporated metal material, a dyed material, or a pigmented material. From this it appears that Mr Hardwick concludes that these recesses must have been formed by embossing.
However, all these passages miss the crucial aspect of the specificity that is required to establish a lack of novelty. The passages highlighted by Innovia say nothing about embossing. The conclusion reached by Dr Hardwick assumes embossing with no actual disclosure of embossing. This is not enough.
The next issue with respect to D1 is in respect of the second authenticating feature. There is no specific embodiment in D1 which includes a second authenticating feature that is visually verifiable, is not magnified by the lenses and which is formed as a metal reflection layer coating the embossed microstructures which are magnified by the lenses. Innovia (and Dr Hardwick) relied heavily upon the disclosure at page 70 line 5 to page 71 line 5 to support their position that D1 disclosed this feature. That passage states:
“The synthetic magnification micro-optic system herein can be combined with additional features including but not limited to these embodiments as single elements or in various combinations, such as icon fill materials, back coatings, top coatings, both patterned and non-patterned, fill or inclusions in the lens, optical spacer or icon materials, as a laminate or coating, inks and or adhesives including aqueous, solvent or radiation curable, optically transparent, translucent or opaque, pigmented or dyed Indicia in the form of positive or negative material, coatings, or print including but not limited to inks, metals, fluorescent, or magnetic materials, X-ray, infrared, or ultraviolet absorbent or emitting materials, metals both magnetic and non-magnetic including aluminum, nickel, chrome, silver, and gold; magnetic coatings and particles for detection or information storage; fluorescent dye and pigments as coatings and particles; IR fluorescent coatings, fill, dyes or particles; UV fluorescent coatings, fill, dyes or particles; phosphorescent dye and pigments as coatings and particles, planchettes, DNA, RNA or other macro-molecule taggants, dichroic fibers, radioisotopes, print receptive coatings, sizing, or primers, chemically reactive materials, micro-encapsulated ingredients, field affected materials, conductive particles and coatings both metallic and non-metallic, micro-perforated holes, colored threads or fibers, patches of Unison embedded in the surface of a document, label, or materials surface, bonded to paper or polymer as a carrier to adhere to paper during manufacture, fluorescent Dichroic threads or particles, raman scattering coatings or particles, color shifting coatings or particles, Unison laminated to paper, paper board, card board, plastic, ceramic, fabric, or metal substrate, Unison as a thread, patch, label, over wrap, hot stamp foil, or tear tape, holographic, diffractive, diffractive kinegram, isograms, photographic or refractive optical elements, liquid crystal materials, Up Conversion and Down Conversion materials.”

To be sure, this passage does mention various metal coatings. However, it lacks the specificity that is required for novelty. The claims require a specific feature located in a specific security element. The “shopping list” in the passage above does not provide clear and unmistakable directions for the skilled person to select the necessary coating and apply it to the necessary part of the security element.
Innovia also pointed to various embodiments in D1 which mention using a “static print” in combination with the moiré magnification effects. They sought to combine this disclosure with a disclosure on 30 line 17 to page 31, line 13 (which I have set out above) which mentions fillings voids with metal and/or with the disclosure on page 56, lines 1–13 which refers to “[t]he addition of a metallized layer” to contend that D1 disclosed a printed metal layer forming a second authenticating feature. This conclusion does not follow. As Giesecke pointed out, Innovia has taken features from different embodiments and combined them to make a feature. The filling mentioned on page 31 and the coating on page 56 are not about altering the features of the static print.
It follows that the claims do not lack novelty in light of D1.
Inventive Step
Innovia characterised the invention as a combination of two components:
(i)a well-known moiré arrangement, utilising a microlens array and a microimage array; and
(ii)an overprinted second image (using the words of Dr Hutley), being positioned over the image array, which is unaffected by the moiré magnification effect of the first component.
Subsection 7(2) of the Act states that an invention is taken to involve an inventive step unless it would have been obvious to a person skilled in the art in the light of the common general knowledge, considered alone or together with the prior art. A document is prior art for this purpose if "a skilled person mentioned in subsection (2) could, before the priority date of the relevant claim, be reasonably expected to have ascertained, understood, regarded [the document] as relevant" (s 7(3)).
The test for whether an invention is obvious is whether it would have been a matter of routine to proceed to the claimed invention. In Wellcome Foundation Ltd v V.R. Laboratories (Aust.) Pty Ltd [1981] HCA 12 at [45], 148 CLR 262 at 286 Aickin J stated:
“The test is whether the hypothetical addressee faced with the same problem would have taken as a matter of routine whatever steps might have led from the prior art to the invention, whether they be the steps of the inventor or not.”
The High Court in Aktiebolaget Hässle v Alphapharm Pty Ltd (‘Alphapharm’) [2002] HCA 59 at [51]- [53]; 212 CLR 411 at [51]-[53] approved this approach, in addition to that taken in Olin Mathieson Chemical Corporation v Biorex Laboratories Ltd [1970] RPC 157 at 187 in which Graham J had posed the question:
“Would the notional research group at the relevant date in all the circumstances directly be led as a matter of course to try [the claimed invention] in the expectation that it might well produce a useful [desired result]?”
Where the invention lies in a combination of features, the question is whether the combination, not each individual feature, is obvious when compared to the prior art base (Alphapharm [2002] HCA 59 at [41]; 212 CLR 411 at [41]; Minnesota Mining & Manufacturing Co v Beiersdorf (Australia) Ltd (Minnesota Mining) [1980] HCA 9 at [116]; (1980) 144 CLR 253 at 293).
The usual approach to determining inventive step is the problem-solution approach. Once the problem has been formulated and the common general knowledge and the prior art base has been determined, the question of whether the claimed solution is obvious must be addressed.
The problem
In determining the problem or ‘starting point’ for considering inventive step, I note the words of the majority of the Full Court in AstraZeneca AB v Apotex Pty Ltd [2014] FCAFC 99 at [203] as follows:
“If the problem addressed by a patent specification is itself common general knowledge, or if knowledge of the problem is s 7(3) information, then such knowledge or information will be attributed to the hypothetical person skilled in the art for the purpose of assessing obviousness. But if the problem cannot be attributed to the hypothetical person skilled in the art in either of these ways then it is not permissible to attribute a knowledge of the problem on the basis of the inventor’s “starting point” such as might be gleaned from a reading of the complete specification as a whole.”
As already noted in this decision, the preferred object of the present invention is stated to be to “specify a generic security element having high counterfeit security that avoids the disadvantages of the background art”. Neither Dr Hardwick nor Dr Hutley state what the problem to be solved by the present invention would be and, therefore, do not state whether such a problem was common general knowledge in the art. Given the lack of evidence, I believe that it could be convincingly argued that the problem that the present invention solves is the object of the invention; being to provide a security element having high counterfeit security.
The person skilled in the art
In general, the skilled person or addressee is the person who works in the art or science with which the invention is connected. He or she is a person, or team, likely to have a practical interest in the subject matter of the invention. While the skilled person may be assumed to be well versed in the relevant art, such a person must be taken to be non-inventive. (Root Quality Pty Ltd v Root Control Technologies Pty Ltd [2000] FCA 980 at [71]-[72]; 49 IPR 225 at [71]-[72] referring to Catnic Components Ltd v Hill &Smith Ltd [1982] RPC 183 at 242 and General Tire [1972] RPC 457 at 485; Minnesota Mining [1980] HCA 9 at [115]; 144 CLR 253 at 293).
Innovia submitted that both Dr Hutley and Dr Hardwick were people skilled in the art. Giesecke submitted that Dr Hardwick was connected with the opponent and had given evidence for Innovia in other contested patent proceedings. Giesecke submitted that he could not be considered to be truly independent. Giesecke also submitted that Dr Hutley was not qualified to give evidence on what was common general knowledge in Australia as he was based in the United Kingdom.
Innovia submitted that the views of Dr Hutley would correspond with the person skilled in the art in Australia given the international nature of the security element industry.
Ultimately the question of whether Dr Hutley can be considered a person skilled in the art does not need to be answered. The result is the same regardless. For the purposes of this decision, I will treat Drs Hardwick and Hutley as people skilled in the art.
The common general knowledge in the art
A definition of common general knowledge was provided by Aitken J in Minnesota Mining [1980] HCA 9 at [115]; 144 CLR 253 at 292:
“The notion of common general knowledge itself involves the use of that which is known or used by those in the relevant trade. It forms the background knowledge and experience which is available to all in the trade in considering the making of new products, or the making of improvements in old, and it must be treated as being used by an individual as a general body of knowledge.”
Information cannot be treated as part of the common general knowledge in the absence of evidence of its general acceptance and assimilation by persons skilled in the relevant art (Alphapharm [2002] HCA 59 at [31]; 212 CLR 411 at [31]).
Noting that Drs Hardwick and Hutley are going to be treated as people skilled in the art, I can take on board their statements as to what was common general knowledge. Conversely, if certain features are not discussed by them, I do not believe that I can take those features as common general knowledge unless it is self-evident from other sources of information.
Lack of inventive step?
Accepting the case law that I have cited above, Innovia’s opposition under the ground of inventive step must fail.
Innovia approached their submissions on inventive step using four approaches:
(i)both (a) moiré arrangements, utilising a microlens array and a microimage array, to produce a moiré magnification effect and (b) an overprinted second image positioned over the image array which is unaffected by the moiré magnification effect of the first component were common general knowledge, and the person skilled in the art would have combined the two;
(ii)moiré arrangements, utilising a microlens array and a microimage array, to produce a moiré magnification effect were not common general knowledge but overprinted second images were and the person skilled in the art would have combined the disclosure of D3 (being ascertained, understood and regarded as relevant) with the common general knowledge of overprinted images
(iii)overprinted second images were not common general knowledge but moiré arrangements were and the person skilled in the art would have combined the disclosure of GB 2362493 (D19) (being ascertained, understood and regarded as relevant) with the common general knowledge of moiré arrangements
(iv)neither moiré arrangements nor overprinted second images were common general knowledge and the person skilled in the art would have combined the disclosure of D19 with a number of documents (all having been ascertained, understood and regarded as relevant)
All features common general knowledge
It can be said that lines 2–10 of claim 1 define what is shown in D1–D3 as the arrangement of microlenses and microstructures/microimages that is required to produce a moiré magnification effect. Drs Hardwick and Hutley also describe moiré magnification as requiring the same arrangement (without explicitly stating that the arrangement was common general knowledge). For the purposes of this analysis I will take that moiré arrangement as being common general knowledge.
It is also said by Drs Hardwick and Hutley that it is known to print coatings onto polymer substrates. For example, Dr Hardwick at [34] mentions creating “windows” in coated polymer substrates by leaving an area uncoated on both sides of the substrate. He also mentions “half-windows” where only one side of the substrate in uncoated in the area of interest. Windowed security threads are further mentioned by Dr Hardwick at [37]. Dr Hardwick also mentions at [36] overcoating diffraction gratings. Dr Hutley talks of overprinting and gives D19 as an example of overprinting.
However, taking that information as common general knowledge, and taking it as a given that the person skilled in the art would combine these two components as they are described by Drs Hardwick and Hutley, the result does not provide all the features of claim 1. The feature that is missing is that the second authenticating feature is a metal reflection layer that is coated on the microscopic structures that are seen via the moiré magnification effect. The overprinting discussed by Drs Hardwick and Hutley do not address this particular feature. The coatings are either over outer surfaces of the security element (e.g. the “windows” mentioned by Dr Hardwick and the disclosure of D19 discussed by Dr Hutley) or over an individual piece of an overall security element which is not magnified (e.g. the holograms and security threads mentioned by Dr Hardwick). Moreover, I have no other sources of information that would lead me to believe that this feature is part of the common general knowledge.
While I note it was said in Commissioner of Patents v Emperor Sports Pty Ltd [2006] FCAFC 26:
“The Commissioner is an administrative decision-maker equipped with technical expertise. Subject to the rules of natural justice both common law and statutory (see e.g. s 101(2)), he or she is entitled to make use of that expertise, and draw inferences that may be rationally drawn from technical knowledge, including how skilled persons of various descriptions may act in their respective occupations”,
I do not believe that I can reasonably draw an inference that coating of other relief structures in other security elements means that coating of the microscopic structures that are subject to moiré magnification in the present security element would be obvious to the person skilled in the art.
The evidence of Drs Hardwick and Hutley do not address the motivation that the person skilled in the art would have to make the adjustments required. I can see no evidence on this point. As noted above, Minnesota Mining makes it clear that the question is whether the combination is obvious. To borrow a phrase from Giesecke’s submissions, there is no evidence to “interlock” the two authenticating features in the way recited in claim 1.
Other approaches
This flaw infects all of the other approaches used by Innovia to the extent that they cannot result in anticipation of the claimed invention.
With respect to approach (ii), the combination of D3 with the type of overprinting as revealed by the evidence provides no disclosure of the printing being done on the microimages.
With respect to approach (iii), the combination of D19 (discussing overprinting) with the common general knowledge of moiré magnification does not disclose the invention. Specifically, D19 states that the overprinting used is a frame around the lens array, or is printed on the surface of the lens array. D19 teaches away from having the overprinting on the microimages (called “objects” in D19).
Regarding approach (iv), the same reasoning applies. Innovia submitted that the claims lack an inventive step in light of any one of a number of documents which, in Innovia’s submission, all disclosed moiré magnifiers, with D19. Even assuming for the sake of argument that the person skilled in the art would have found it obvious to combine the documents (and the evidence does not seem to support that it would have been obvious), the flaws in D19 remain. It does not teach overprinting the objects to be magnified.
On the evidence before me I cannot find that the claims lack an inventive step.
Clarity
Sheppard J summarised the rules of construction for a patent specification in Décor Corp v Dart Industries 13 IPR 385 at 400. This summary has been referred to in numerous subsequent judgements, and was endorsed by the Full Federal Court in Pfizer Overseas Pharmaceuticals v Eli Lilly [2005] FCAFC 224.
It is a recognised tenet of Australian patent law that each claim must be read as part of the entire specification (Electrical and Musical Industries Ltd v Lissen Ltd 56 RPC 23 at 39), and thus the meaning of the words used in a claim may be affected by what is said in the body of the specification (Rosedale Associated Manufacturers Ltd v Carlton Tyre Saving Co Ltd [1960] RPC 59 at 69). While noting that it is not legitimate to narrow or expand the boundaries of monopoly as fixed by the words of a claim, by adding to those words glosses drawn from other parts of the specification (Welch Perrin & Co Pty Ltd v Worrel (1961) 106 CLR 588 and Decor Corporation Pty Ltd v Dart Industries Inc (supra)), it is legitimate to refer to the rest of the specification to explain the background to the claims, to ascertain the meaning of technical terms and resolve ambiguities in the construction of the claims (see Interlego AG v Toltoys Pty Ltd (1973) 130 CLR 461 at 476).
More recently, the approach to the construction of claims was discussed by Bennett J in H Lundbeck A/S v Alphapharm Pty Ltd [2009] FCAFC 70, 81 IPR 228 at [118] – [120]:
“the words in a claim should be read through the eyes of the skilled addressee in the context in which they appear … while the claims define the monopoly claimed in the words of the patentee's choosing, the specification should be read as a whole … it is not permissible to read into a claim an additional integer or limitation to vary or qualify the claim by reference to the body of the specification … terms in the claim which are unclear may be defined or clarified by reference to the body of the specification”
I also note what Middleton J said in Eli Lilly and Company Limited v Apotex Pty Ltd [2013] FCA 214, 100 IPR 451 at [139]:
“It is well settled that the Court should, from the outset, approach the task of patent construction with a generous measure of common sense. The Court must place itself in the position of a person skilled in the relevant art, being the subject matter of the patent. From this perspective, the patent is to be read as a whole, in the context of the specification and in light of the prevailing common general knowledge and state of the relevant art at the priority date.”
Innovia submitted that claims 1, 2, 3, 4, 8, 23 and 24 lacked clarity for a number of reasons. Claim 1 was said to lack clarity because:
(i)is unclear what is meant by the term “slightly” when it is stated that “the spatial frequencies of the both grids differ slightly”
(ii)the term “not magnified” in claim 1 is also not clear
(iii)there is no antecedent for “the magnifying effect”
(iv)the phrase “does not relate to the second authenticating feature” is not clear in what manner the magnification effect “does not relate” to the second authenticating feature
I can see no merit in any of these points. While these terms might be considered to be unclear when considered in isolation, all of the supposed clarity problems fall away when considered in light of the context in which they appear. A “slight” difference in frequencies is easily understood when it is understood that the difference has to be slight enough to create a moiré effect. The antecedent for “the magnifying effect” is clearly present in lines 8–9 of the claim. Furthermore, it is clear from my discussion above with respect to the further evidence that “does not relate” is understood. I also note that neither Dr Hardwick nor Dr Hutley had any problems understanding the claim.
Innovia submitted that claim 2 lacked clarity when requiring the first and second grids to “exhibit fixed geometric relationships”. They stated that a geometric relationship was a three-dimensional concept and it could refer to the distance between the grids as well as their relative orientation. Innovia submitted it was not clear what the fixed geometric relationship was referring to. As with claim 1, I cannot see a problem. Innovia clearly had no problem in recognising what relationships could be “fixed”. I don’t see why this claim’s scope is not able to be determined.
Claim 3 was said to lack clarity because of the use of “slightly” when defining that the line screen spacing differed between the different grids. This fails for the same reason it did for claim 1. The same also applies to Innovia’s submission that claim 4 was not clear because of the use of “slightly” in the phrase “disposed slightly rotated against one another”.
Claims 3, 4, 23 and 24 were all said to lack clarity because it was not clear what was meant by the term “line screen spacing”. While it may not be a term of art, when construed in the context, as it should be, there is no clarity problem here. I note that Dr Hardwick at [72], while noting that claim 5 uses the term “line screen”, states:
“I assume that this claim intended to refer to the “line screen spacing” or the pitch of the microlens and microimage arrays” (my emphasis)
Furthermore, Dr Hutley states:
“I am not familiar with the term “line screen spacing”, however I take this to be referring to the period of the grids and arrays”
The phrase “line screen spacing” is clearly understandable.
With respect to claim 8 Innovia submitted:
“Claim 8 is not clear, in particular with regard to the phrase “the focusing elements of the first arrangement and the embossed microstructures of the second arrangement are developed as elevations that point in the same direction”. When a surface is embossed to form elevations, there will necessarily be depressions formed between the elevations, and the depressions will point in the opposite direction to the elevations. It is not clear from claim 8 whether it is the elevations or the depressions of the embossed microstructure that point in the same direction as the focusing elements”

This submission seems to completely ignore the words in claim 8. Claim 8 clearly states that:
“the focusing elements of the first arrangement and the embossed microstructures of the second arrangement are developed as elevations that point in the same direction.”
I cannot see how this can be misunderstood. In the same way that a mountain can be said to “point” to the sky, the elevations (i.e. the parts between the depressions of the embossing) point in the same direction. While Dr Hutley states that he has “difficulty in understanding the point of this claim” ([63]), he does not say that he does not understand the claim.

100. While it is certainly possible to apply an overly meticulous, semantic analysis and come up with words or short phrases which are, strictly speaking, not perfect, I note it was said in Austal Ships Sales Pty Ltd v Stena Rederi Aktiebolag [2008] FCAFC 121, 77 IPR 229 at [81]:
“Lack of precise definition in claims is not fatal to their validity, so long as they provide a workable standard suitable to their intended use”

In my opinion, the claims provide a workable standard and, as such, do not lack clarity.
Fair basis
101. I have set out the requirements for fair basis in paragraphs 20–22 above. I will not repeat them here.
102. Innovia submitted that claim 1 did not satisfy section 40(3) because there was no disclosure in the specification of the words “does not relate to”. Innovia also submitted that claim 1 did not limit the second authenticating feature to being “machine verifiable” as well as “visually verifiable”.
103. The first thing to note is that Innovia’s Statement of Grounds and Particulars (“SGP”) contained no indication of a case with respect to fair basis. In the normal course of events I am within my rights not to entertain any argument on fair basis in this opposition. The SGP necessarily constrains the scope of the opposition and it does not contain this particular. This remains true notwithstanding the fact that the Commissioner can decide an opposition on grounds not raised by the opponent. However, noting that I had to consider fair basis in determining whether to grant leave for the further evidence supplied by Innovia, I will consider this ground because the points can be dealt with very shortly. However, my actions here do not lay down a blanket rule that this behaviour is acceptable.
104. Regarding the words “does not relate to”, as I made clear in my discussion under further evidence, claim 1 is fairly based in this regard. The description at page 20, lines 11–14 when discussing figure 4 and the passage at page 23, line 24–page 24, line 3 when discussing figure 8 (which is clearly analogous to figure 4) disclose the necessary feature.
105. With respect to Innovia’s position that the second authenticating feature must be both visually verifiable and machine verifiable, this is clearly an attempt to limit the claims to what is shown in the preferred embodiments. The authorities cited above (Rehm in particular) make it clear that this is not required to confer fair basis. While it is true that that the preferred embodiment discloses the second authenticating feature being comprised of material that make it both visually verifiable and machine verifiable, as Giesecke stated, it is not clear why it is essential that the claim be so limited.
106. In my opinion, the claims are fairly based.
CONCLUSION
107. The opposition is unsuccessful. The claims are clear, fairly based, novel and inventive.
108. Subject to appeal, I direct that the application proceed to grant.
COSTS
109. Innovia submitted that if the opposition was successful on any ground then costs should follow the event. Innovia further submitted that, if the opposition was unsuccessful against the amended claims, then I should consider the opposition to the patent application as accepted has been successful and Innovia should be awarded costs up to the date that the amendments were filed. Innovia also submitted that if it was found that the claims were not entitled to the priority date based upon their late-filed documents, then no costs should be awarded.
110. While Giesecke submitted that costs should follow the event, they also submitted that that costs should reflect time thrown away by Innovia’s late application for further evidence. Giesecke further submitted that if Innovia was successful on a minor point, then any costs order should reflect the scale of that given the presence of many other grounds within the opposition.
111. Innovia has been unsuccessful. It is true that amendments have been filed. However, the features that give the invention novelty and inventiveness over the evidence supplied were present at acceptance. They were not added by the amendments. Furthermore, the claims are entitled to their priority date. As such I see no reason to alter the usual practice. I award costs against Innovia.
Greg Powell
Delegate of the Commissioner of Patents