Intervet International B.V. v Merial Inc

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FEDERAL COURT OF AUSTRALIA

Intervet International B.V. v Merial Inc [2016] FCA 1030

Appeal from: Merial, Inc v Intervet International B.V. (Federal Court of Australia, VID 399 of 2015, 16 August 2016)
File number: VID 980 of 2016
Judge: MIDDLETON J
Date of judgment: 24 August 2016
Catchwords: PRACTICE AND PROCEDURE – witnesses – video link – application for evidence to be given by – Federal Court of Australia Act 1976 (Cth) s 47A – whether party required to make out case for use of video link – cross-examination – overarching purpose of civil litigation – Federal Court of Australia Act 1976 (Cth) s 37(M)(1), (2), (3), (4).
Legislation:

Evidence Act 1995 (Cth)

Evidence (Miscellaneous Provisions) Act 1958 (Vic)

Federal Court of Australia Act 1976 (Cth)

Patents Act 1990 (Cth)

Cases cited:

Australian Competition & Consumer Commission v StoresOnline International Inc [2009] FCA 717

Blackrock Asset Management Australia Services Limited v Waked (No 2) [2011] FCA 479

Campaign Master (UK) Ltd v Forty Two International Pty Ltd (No 3) (2009) 181 FCR 152

Corrigan v Commvault Systems (Aust) Pty Ltd (2011) 192 FCR 71

Decor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397

Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (2015) 231 FCR 531

House v R (1936) 55 CLR 499

Neimann v Electronic Industries Ltd [1978] VR 431
Date of hearing: 24 August 2016
Registry: Victoria
Division: General Division
National Practice Area: Intellectual Property
Sub-area: Patents and associated Statutes
Category: Catchwords
Number of paragraphs: 59
Counsel for the Applicant: Ms K Howard SC with Mr C Smith
Solicitor for the Applicant: Spruson & Ferguson Lawyers Pty Limited
Counsel for the Respondent: Mr C Dimitriadis SC with Ms C Cunliffe
Solicitor for the Respondent: Ashurst Australia

ORDERS

VID 980 of 2016
BETWEEN:

INTERVET INTERNATIONAL B.V.

Applicant
AND:

MERIAL INC

Respondent

JUDGE:

MIDDLETON J

DATE OF ORDER:

24 AUGUST 2016

THE COURT ORDERS THAT:

1.The application for leave to appeal is dismissed with costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

MIDDLETON J:

INTRODUCTION

  1. This is an application by Intervet International B.V. (‘Intervet’) for leave to appeal from a decision of the primary judge, concerning a matter of practice and procedure and the exercise of his discretion. Leave is required by s 24(1A) of the Federal Court of Australia Act 1976 (Cth) (the ‘Federal Court Act’) because the decision is interlocutory. The respondent, Merial Inc (‘Merial’) opposes the grant of leave.

  2. The primary judge decided that an order should be made pursuant to s 47A of the Federal Court Act for the testimony of a particular witness, Mr Mark Pieloch, to be given by video link from the United States at the trial of the proceeding which commences next week. After considering the evidence led and the written and oral submissions made by the parties, the primary judge concluded that a…

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Details
Case
[2016] FCA 1030
Decision Date

CaseChat Overview and Summary

The appeal in Intervet International B.V. v Merial Inc concerned the grant of a patent application filed by Intervet, which was opposed by Merial. The primary judge dismissed Merial's opposition, leading to this appeal. A significant issue in the appeal was the primary judge's decision to allow a key witness, Mr Pieloch, to give evidence via video link rather than in person. This decision was pivotal as Mr Pieloch's testimony was crucial to the outcome of the patent dispute, especially regarding the validity of Intervet's claim to the invention and any alleged assignment of rights from Mr Pieloch.

The court had to decide whether the primary judge erred in allowing Mr Pieloch to give evidence via video link, considering the importance of his testimony and the potential impact on the effectiveness of cross-examination. The legal issue centred on the interpretation and application of sections 47A and 37(M)(1), (2), (3), (4) of the Federal Court of Australia Act 1976 (Cth) regarding the use of video links for witness testimony and the overarching purpose of civil litigation. The court also needed to assess whether the primary judge's decision to allow video link testimony was just and fair, considering the nature of the issues involved and the importance of Mr Pieloch's evidence.

The court found that the primary judge's decision was not in error and did not result in substantial injustice. The judge was aware of the arguments on both sides and had all relevant evidence before making the decision. The judge concluded that the difference between video link and live testimony was not significant enough to prevent Mr Pieloch from giving effective evidence. The court also noted that the primary judge had considered the importance of Mr Pieloch's evidence and the potential impact on the proceedings. The court determined that the primary judge's decision was within their discretion and aligned with the overarching purpose of civil litigation, which is to achieve just, quick, and cheap resolution of the real issues.

The court dismissed Merial's application for leave to appeal, affirming the primary judge's decision to allow Mr Pieloch to give evidence via video link. The court also ordered that Merial pay costs associated with the appeal. This decision underscores the flexibility courts have in managing witness testimony, particularly in complex patent disputes where the importance of a witness's evidence can significantly impact the outcome.

Orders

Orders of the court

1. The application for leave to appeal is dismissed with costs.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Two immediate observations can be made. The primary judge was aware of there being arguments both ways, just having the benefit of legal submissions and being aware of the evidence going to be led at trial. Secondly, the primary judge accepted that steps should have been taken to bring the application earlier but nevertheless was still able to be persuaded to make the order as requested by Merial based upon a number of factors.BACKGROUND The proceeding before the primary judge is an appeal brought by Merial against a decision of the Commissioner of Patents dismissing its opposition to the grant of a patent on the patent application in suit. Intervet filed the patent application on 31 July 2009 (with a priority date of 13 August 2002), Merial filed an opposition on 28 October 2011, a decision was given on 10 July 2015 and an appeal was lodged on 31 July 2015. Subsequently, Merial amended the Notice of Appeal to introduce a new ground of lack of entitlement. On 8 February 2016, the hearing of the proceeding was set down for a period of five to seven days commencing on 29 August 2016. On 9 August 2016, Merial filed an Amended Interlocutory Application seeking an order that the testimony of Mr Pieloch be given by video link at the trial of the proceeding. The hearing of the Amended Interlocutory Application took place on 16 August 2016. Merial relied on three affidavits of Mr Fisher, filed and served on 5 August, 9 August and 16 August 2016. On 16 August 2016, the parties filed submissions setting out their positions with respect to Mr Pieloch giving evidence by video link. It can be accepted that Mr Pieloch is a critical witness on the issue of entitlement, and his evidence (if accepted) could be potentially fatal to Intervet’s right to the grant of a patent. Mr Pieloch asserts that he is the sole inventor of the invention the subject of the patent application in suit, and that he did not agree with Intervet that it would have the rights to the invention, or that he assigned his rights to Intervet. Intervet contends that it will be substantially prejudiced if it is required to cross-examine Mr Pieloch by video link because, as explained by Buchanan J in Campaign Master (UK) Ltd v Forty Two International Pty Ltd (No 3) (2009) 181 FCR 152 (‘Campaign Master’) at [77]-[78], the value of cross-examination is less effective if the witness is not present in the courtroom. Intervet submitted that this was especially so in the circumstances of the present case, where Mr Pieloch’s evidence is crucial and involves complicated factual issues, and will involve consideration of a substantial number of lengthy documents and significant challenges to credit.RELEVANT PRINCIPLES ON APPLICATION FOR LEAVE TO APPEAL Section 24(1A) of the Federal Court Act confers on the Court a discretion to grant leave to appeal. The discretion of the Court in respect of an application for leave to appeal is informed by (but not limited to) the principles articulated and explained in Decor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 (‘Decor’). The principles are not to be applied inflexibly and each case must be considered on its own merits.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

In my view, in addition to there being no error shown in the approach of the primary judge, there is also no substantial injustice resulting by the failure to grant leave to appeal.CONCLUSION For the above reasons the application for leave to appeal will be dismissed with costs.

Ratio Decidendi

Legal Principle Established

It was contended that the evidence relied upon by Merial did not satisfy the standard required by courts in an application such as the present one, and this should have been taken into account. Those considerations should have supported the conclusion that it was unfair for Intervet to be deprived of the opportunity of having Mr Pieloch give evidence in person, rather than it being unfair for Merial not to have the opportunity to rely on the evidence of Mr Pieloch.CONSIDERATIONSufficient doubt It is to be recalled that Mr Pieloch is named by Intervet as an inventor in support of its application for a patent, which is opposed by Merial in the proceeding below under the provisions of the Patents Act 1990 (Cth) (the ‘Act’). Thus Intervet is the party who has had a prior relationship with Mr Pieloch, and then claims to derive its title to the alleged invention from him. Mr Pieloch is not in Merial’s camp, and Merial has no prior relationship with him. Mr Pieloch is not a compellable witness. There is no dispute that Mr Pieloch was an inventor of the alleged invention claimed in the patent application, if the invention was patentable. An essential issue (but not the only issue) to which Mr Pieloch’s evidence goes is whether or not there was any assignment of rights in that invention from Mr Pieloch to Intervet, as Intervet asserts in support of its claim to be entitled to the grant of a patent. There is another issue relating to whether Mr Pieloch was in reality the sole inventor who conceived of and developed the invention. This issue is pleaded by Merial, and Mr Pieloch refers to this in his affidavit of 20 January 2016. Whilst reference was made in submissions by Merial to the ‘confined nature’ of the issues for cross-examination, the primary judge had all the evidence of Mr Pieloch before him, and would have made his own assessment based on that evidence. The primary judge was entitled to proceed on the basis of his assessment that the testimony was relatively confined and based upon documentation. There was admissible evidence before the primary judge to the effect that Mr Pieloch was unable and unwilling to travel to Australia to give oral testimony. The primary judge was entitled to accept that evidence. The fact the evidence to this effect was produced late was observed by the primary judge, but this did not affect the admissibility of the evidence. The primary judge then had this position before him: Mr Pieloch was a person from whom Intervet claimed to derive its title to the alleged invention, who was not in Merial’s camp or under its control, whose evidence was clearly relevant but nevertheless seemed confined in scope, and who, on the evidence, would not come to Australia for the hearing and could not be compelled to do so. The primary judge concluded that the choice in this case was not between Mr Pieloch’s evidence being given by video link or in person, but rather between it being given by video link or not at all. However, that was not the only matter that the primary judge considered. In addition, the primary judge decided that the difference between video link and live testimony was not ‘so significant in the context of the issues in this case that it provides a sufficient reason to decide that Mr Pieloch’s evidence cannot be given by video’.