Innovia Security Pty Ltd v Visual Physics, LLC - [2016] APO 75

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Innovia Security Pty Ltd v Visual Physics, LLC [2016] APO 75

Patent Application: 2010226869

Title:Micro-Optic Security and Image Presentation System

Patent Applicant:  Visual Physics, LLC
Opponent:  Innovia Security Pty Ltd
Delegate:  M. G. Kraefft
Decision Date:  28 October 2016
Hearing Date:  Written submissions completed on 21 September 2016

Catchwords: PATENTS – section 59 - final determination – amendment overcame defects identified in previous decision - application proceed to grant.

Representation: Patent attorney for the applicant: Shelston IP.
Patent attorney for the opponent: Watermark.

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2010226869

Title:Micro-Optic Security and Image Presentation System

Patent Applicant: Visual Physics, LLC
Date of Decision: 28 October 2016
DECISION
The applicant’s Section 104 amendment has overcome the defects identified in the previous decision. There was no further impediment to the grant of a patent in the present case.
Subject to appeal, I direct the application proceed to grant.
In the present matter, costs in accordance with Schedule 8 awarded against the opponent, Innovia Security Pty Ltd.
REASONS FOR DECISION
BACKGROUND

This is a final determination matter from my decision, Innovia Security Pty Ltd v Visual Physics, LLC, [2015] APO 82 (“the previous decision”), the result of an opposition by Innovia Security Pty Ltd (“the opponent”) against patent application 2010226869 by Visual Physics, LLC, (“the applicant”). In that decision, I found that several claims lacked an inventive step over US 5712731 (“the Drinkwater patent”). As a consequence, I allowed the applicant an opportunity to propose suitable amendments to overcome the defects.
The applicant filed a request to amend under Section 104 on 5 February 2016. That amendment was allowed on 7 July 2016, unopposed. Prior to final determination, both parties requested to be heard. With agreement from the parties, the hearing was conducted on the basis of written submissions.
APPLICABLE LAW
It is well established that the decision of a delegate in opposition proceedings determines the matter finally, subject to appeal (R v Smith (Commissioner of Patents); Ex parte Mole Engineering Pty Ltd, [1981] HCA 25; (1981) 147 CLR 340 at 348-349). There is no scope for the Commissioner to re-open or re-hear matters that had already been determined in the previous decision.
THE AMENDMENT
The relevant change arising from the applicant’s Section 104 amendment is to the end of claim 2. Claim 2 was the only independent claim found to lack an inventive step. The other claims found wanting were deemed wanting insofar as being dependent on claim 2. Thus, if the amendment to claim 2 overcomes the ground of lack of inventive step then the other claims would likewise be inventive. The applicant’s Section 104 amendment also altered page 3 of the specification consistent with the amendment to claim 2.
Claim 2 is reproduced below with the amendment highlighted.
2. Film material comprising micro-images formed of a periodic planar array of a plurality of image icons and a regular two-dimensional array of non-cylindrical lenses, the film material utilizing the regular two dimensional array of non-cylindrical lenses to enlarge the micro-images, and to form a synthetically magnified image through the united performance of a multiplicity of individual lens/icon image systems,
wherein the micro-images are formed from voids in a microstructure, and
wherein voids in the microstructure are filled or coated with evaporated metal material or dyed or pigmented material, or ~~another~~ a material for enhancing image contrast.
DISCUSSION
The opponent’s submissions appeared to attempt to re-open matters that were no longer available. Statements were included that the applicant’s Section 104 amendment is not allowable as it offends against Section 102 on the grounds of lack of clarity and fair basis. For example, the opponent’s reading of the amended feature, from its submissions, led the opponent to question the scope of claim 2. On the other hand, the opponent was unsuccessful on Section 40 grounds in the previous decision and did not appeal the previous decision. Moreover the opponent did not oppose the applicant’s Section 104 amendment arising from that decision. Consequently Section 40 objections are no longer available to the opponent, following the principle in Ex parte Mole Engineering (supra). Nonetheless, in construing the claim for present purposes, I expect I will address much of opponent’s concern.
Using the example of the addition of a protective coating over the voids created in the micro-structure by the aluminium film-based embodiment in the Drinkwater patent (see the previous decision at [66]), the opponent appeared to read “another material” in the earlier claim 2 as encompassing a protective coating that must also provide some degree of image contrast. While there would be little doubt that image contrast would lead to better image perceptibility, it is not at all apparent that the protective coating must necessarily provide the image contrast. In simplest form, if contrast were important, a transparent protective coating added over the voids of the Drinkwater security device would necessarily require some aspect of the Drinkwater device to provide contrast. It may also be noted that the opponent’s Dr Hardwick (as per [66] of the previous decision) expressed in evidence the commonality of applying protective coatings to security devices, particularly to prevent degradation when in use. Image contrast was not mentioned. Hence the opponent appears to have erroneously linked protective materials as necessarily also providers of image contrast. On this basis the opponent suggested that the scope of claim 2, before and after amendment, was not materially different. Given, especially, Dr Hardwick’s evidence as mentioned above, I find this position is incorrect.
The scope of amended claim 2 is clearly different to that prior to amendment. Before amendment, any other material that filled or coated the voids in the micro-structure was within scope. After amendment, other than potentially evaporated metal or dyed or pigmented material, a fill or coating material that does not enhance image contrast is not in scope.
Turning to inventive step, the subject of the adverse finding in the previous decision, the applicant submitted the amendment overcame the defects identified in the previous decision. In particular the applicant stated that, while it was found to have been a matter of routine to apply a protective coating over the voids in the relevant embodiment in Drinkwater, there was nothing which supported a position that a protective coating would, as a matter of course, have been comprised of a material for enhancing image contrast. On the basis of the evidence already alluded to above, I agree. I would also note that this point again highlights the error of the opponent’s position that protective coatings necessarily also provided image contrast.
In the previous decision (at [63]) I noted that the opponent submitted the only relevant difference of claims 1 and 2 from the micro-images disclosed in the Drinkwater patent was that the voids were filled or coated with either evaporated metal, or a dyed or pigmented material. The opponent indicated the clear purpose for this claimed feature was to introduce a level of contrast between the voids and the solid areas. If that is so, then a natural conclusion of the absence of such fills or coats from the voids of the Drinkwater security device would be that there was insufficient image contrast in the device. The opponent would be correct in its submissions that, in order to be visually perceived, there must be optical contrast. While this would not be in dispute, for present purposes it would be the means by which this was achieved that would be paramount. In this respect, the Drinkwater patent did not allude to any failure of the device on account of the absence of materials in the voids to induce image contrast. On the contrary the Drinkwater patent clearly expressed the visibility of images generated by the Drinkwater device. See for example the discussion of moiré magnified images at columns 2 and 3, and the discussion of image formation in the aluminium film-based embodiment (column 11). In the latter case, the aluminium film in selective areas may be said to have provided the image contrast between the aluminium solid regions and the voids between those regions. The applicant noted the etching process to form the images in the aluminium film would itself create contrast. Thus the need to further fill or coat the voids in Drinkwater with contrasting material, whether evaporated metal, dyed or pigmented material or otherwise, was not evident and, as alluded at [64] of the previous decision, would not have been a matter of course at the relevant time.
While not expressly put in these terms, the opponent appeared to further submit that use of a material for filling or coating the voids for enhancing image contrast, as claimed, could not be inventive over the use of material that provided normal or typical image contrast. On the other hand this position presupposed the provision of image-contrasting material in the voids in the first place. As mentioned above, the filling or coating of the voids in Drinkwater with image-contrasting material was not established to have been a matter of course at the relevant time. Consequently the provision of a fill or coating material in the voids for enhancing image contrast cannot have been a matter of course either at the relevant time.
CONCLUSION
I find the Section 104 amendment has overcome the defects identified in the previous decision. There being no further impediment to the grant of a patent in the present case, subject to appeal, I direct the application proceed to grant.
COSTS
Both parties sought their costs in the present matter. Costs normally the follow the event and I see insufficient reason to depart from that practice in the present case. The opponent has been unsuccessful in the present matter. I award costs in accordance with Schedule 8 against the opponent, Innovia Security Pty Ltd.
M. G. Kraefft
Delegate of the Commissioner of Patents