John Andrew Willems, Alan Gordon Fritz, Malcolm John Hall and Richard John Johnson
[1991] APO 11
•26 March 1991
PATENTS ACT 1952
DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS
Re:Application No. 82431/87 in the Names of JOHN ANDREW WILLEMS, ALAN GORDON FRITZ, MALCOLM JOHN HALL and RICHARD JOHN JOHNSON : proceedings under S.34(4) and S.63
Background
On 10 December 1986 the persons named above filed an application accompanied by a provisional specification. On 10 Decemb er 1987, they lodged the complete specification, entitled ANFO Composition. ANFO is an acronym for "ammonium nitrate fuel oil", and is an explosive composition suitable for mixing in bulk, and in situ. On 11 October 1990, I heard the following two matters in Sydney:
.A request for a direction under Section 34(4), lodged on 20 March 1989 by JOHNSON'S EXPLOSIVES (QUEENSLAND) PTY LTD to have patent application 82431/87 prpceed in its name on the ground that it is a person who would, if a patent were granted be entitled to have the patent assigned to it;
.A request for a determination of the Commissioner under Section 63, lodged on 16 November 1989, by ALAN GORDON FRITZ, JOHN ANDREW WILLEMS and MALCOLM JOHN HALL to have the application proceed in the names of ALAN GORDON FRITZ and JOHN ANDREW WILLEMS on the grounds that:
(1)the said Alan Gordon Fritz and John Andrew Willems are the true inventors of the invention disclosed in the application;
(2)the invention was not made by either Alan Gordon Fritz or John Andrew Willems in the course of his employment with Johnson's Explosives;
(3)Richard John Johnson was incorrectly named as an inventor in relation to the application;
(4)if Richard John Johnson was at any time prior to 10th December 1987 a person entitled to be an applicant, he is one of two or more joint applicants who refused to proceed with the application;
(5)if Richard John Johnson held an interest in the application in trust for Johnson's Explosives (Qld) Pty Ltd or any other company then that company was one of two or more joint applicants who refused to proceed with the application.
The applicants of record are normally represented by the Sydney firm of patent attorneys, Spruson & Ferguson, but in relation to these (ownership) proceedings Mr P.C. Fisher, patent attorney of G.R. Cullen & Co, Brisbane, represented Richard John Johnson and Johnson's Explosives (Queensland) Pty Ltd. Mr D. Yates of Counsel, and Dr I.T. Ernst, patent attorney of Shelston Waters, Sydney, represented John Andrew Willems, Alan Gordon Fritz and Malcolm John Hall.
A declaration, with exhibits, made by Richard John Johnson accompanied the S.34(4) request. In April 1989, the delegate of the Commissioner advised the attorneys concerned (Cullen) that the evidence did not support action under S.34(4).
The attorneys replied on 12 July and submitted a comprehensive report on the matter. The other three applicants submitted joint evidence in answer to this on 16 November 1989, including a statutory declaration and exhibits from each, together with statutory declarations and exhibits from Charles Hector Murray and Bob Barren, persons who held various positions at Riverside Mine in the blasting field and dealt with Alan Fritz in his capacity as sales representative for Johnson's Explosives. At the same time Willems, Fritz and Hall lodged a section 63 request. This request was advertised in the Official Journal of Patents on 8 February 1990.
Evidence
From the evidence, a summary of events can be ascertained:Early September 1986 Fritz visited Riverside Mine and heard of attempts to solve problem of ANFO explosive having a high detonation pressure, high density and low volume and not working well for some types of rock, by adding polystyrene to the mixture (Fritz declaration paragraph 27);
Some days later Fritz and Willems decide to try sawdust admixed with ANFO (Fritz declaration paragraph 28);
29 October 1986 patent attorney sends questionnaire to Johnson's Explosives (Queensland) Pty Ltd attention to Willems and mentioning request by Hall (exhibit JAW-7);
10 December 1986 provisional application lodged in names of JOHN ANDREW WILLEMS, ALAN GORDON FRITZ, MALCOLM JOHN HALL and RICHARD JOHN JOHNSON;
14 January 1987 Form 7 declaration signed by all four applicants;
3 February 1987 Form 7 declaration lodged (naming all four applicants as the inventors);
25 February 1987 letter from Johnson to Willems, Hall and Fritz stating that the invention is the property of Johnson's Explosives as employer, but he - Johnson - believes in profit sharing (exhibits MJH-1, AF-7 and JAW-2);
26 April 1987 Fritz and Hall left the employ of Johnson's Explosives (Johnson's declaration paragraph 12);
1 May 1987Willems left the employ of Johnson's Explosives (Johnson's declaration paragraph 12);
end April 1987 Nitro Nobel enters joint venture with Johnson's Explosives, and Hall, Fritz, Willems and Johnson are employed and paid by Nitro Nobel (Hall's declaration paragraphs 18 and 27, Fritz's declaration paragraph 38);
13 May 1987 Willems sends facsimile transmission to attorneys advising that the inventors should be JOHN ANDREW WILLEMS and ALAN GORDON FRITZ and patent applicants should be JOHN ANDREW WILLEMS, ALAN GORDON FRITZ, MALCOLM JOHN HALL and RICHARD JOHN JOHNSON in order as listed (exhibit JAW-8);
13 May 1987 meeting of the four applicants at Johnson's home decided that a shelf company be purchased with equal shareholdings for each of the four (Hall's declaration paragraph 14);
20 May 1987 patent attorney sends facsimile transmission to Johnson's Explosives concerning a copy of "new" confidential agreement between the four applicants and the BHP Co Ltd. A major change in the agreement was that Willems, Fritz, Hall and Johnson were named as "applicants" and not "inventors" (exhibit JAW-9);
28 May 1987 patent attorney sends letter to all four applicants, draft Complete After Provisional specification, and draft Deed of Assignment to assign the invention from JOHN ANDREW WILLEMS and ALAN GORDON FRITZ to JOHN ANDREW WILLEMS, ALAN GORDON FRITZ, MALCOLM JOHN HALL and RICHARD JOHN JOHNSON (exhibits RJJ 2, AF-11 and JAW-5);
10 December 1987 complete after provisional lodged in names of JOHN ANDREW WILLEMS, ALAN GORDON FRITZ, MALCOLM JOHN HALL and RICHARD JOHN JOHNSON;
10 December 1987 attorney sends debit note to Hall, Willems and Fritz (exhibits JAW-6 and AF-11;
22 January 1988 letter from solicitors to all four applicants about their new shelf company (exhibit AF-9);
20 March 1989 request under s.34(4) made by JOHNSON'S EXPLOSIVES (QUEENSLAND) PTY LTD for transfer of title to its own name;
16 November 1989 s.63 request made by JOHN ANDREW WILLEMS, ALAN GORDON FRITZ and MALCOLM JOHN HALL for transfer of title to JOHN ANDREW WILLEMS and ALAN GORDON FRITZ.
Submissions
The evidence is clearly in conflict on many important points and the submissions by Mr Fisher for Johnson and Johnson's Explosives and those of Mr Yates for Willems, Fritz and Hall highlight this. For instance, there are differing statements even on the basic point of who gave instructions for a patent application to be made.
Mr Fisher's submissions can be summarised as follows:
.there is a master/servant right of Johnson's Explosives in the invention, as the applicants Willems, Fritz and Hall were all employees of the Company when the invention was made : furthermore, two of these persons were shot firers by trade, and it is to be noted that mixing and firing of explosives (under test or otherwise) must be done under license - in this case the company held the license; therefore it is most probable that these people used company time and materials while working on the invention;
.Johnson did not intend that the application be lodged in the four names, but when he noticed that it was so, he still signed the declaration because he was not sure of the patent system and assumed that it must be usual practice;
.in Johnson's letter of 25 February 1987 to the other three applicants, he stated that he believed the application to be the property of the company.
Mr Yates' submissions can be summarised as:
.Fritz and Willems had written contracts from Johnson's Explosives setting our their work requrements; research and development in explosives was definitely not part of their duties;
.the patent application is in four names and one, Johnson, is refusing to proceed; in particular, he will not sign the new declaration form which states that Willems and Fritz are the actual inventors;
.Fritz and Willems made the invention and there is no evidence to support Johnson's assertion that he, as part of the team, had made any contribution whatever which would entitle him to be named as an inventor;
.Hall is aware of the nature of the s.63 action, and has raised no objection; he concedes that Fritz and Willems are the true inventors and are entitled to have a patent sealed in their names : he seeks to be included in the entitlement only if it is decided that the applicants should remain unchanged. However Mr Yates also suggested that the result of the s.63 action could be a determination that the application proceeds in the three names Fritz, Willems and Hall.
Section 34
The relevant portions of s.34 read as follows:
"34(1)Any of the following persons, whether a British subject or not may make an application for a patent:
(a)the actual inventor;
(fa)a person who would, if a patent were granted upon an application made by a person referred to in any of the preceding paragraphs, be entitled to have the patent assigned to him.
(4)Where, at any time before a patent has been granted, a person would, if the patent were then granted, be entitled, by virtue of an assignment or agreement made by the applicant or one of the applicants for the patent, or by operation of law, to the patent or to the interest of the applicant in the patent or to an undivided share in the patent or in that interest -
(a)the Commissioner may, upon a request being made as prescribed, direct that the application is to proceed in the name of the person or in the names of the person and the applicant or the other joint applicant or applicants, as the case requires; and
(b)upon such a direction being given, this Act applies as if the person were the applicant or one of the joint applicants, as the case requires."
Section 34(1) is concerned with the class of persons who are entitled to apply for a patent. An obvious inclusion in the class is set out in sub-paragraph (a) i.e. the actual inventor. A not so obvious inclusion is set out in sub-paragraph (fa). Historically, sub-paragraph (fa) was introduced to cover employer/employee situations where an employee's invention was made in the course of his or her normal work, and rightfully belonged to the employer. Thus the employer becomes, in this situation, the kind of person specified in that sub-paragraph and is entitled to make application for a patent on that basis. However, the import of the sub-paragraph is not, on a plain reading, limited to that particular situation.
From the outset, I wish to make it clear that the action initiated by Johnson's Explosives under s.34 is not a de facto obtaining action. Thus if Mr Fisher's submissions of fact are correct, Johnson's Explosives is a person entitled to apply for a patent under s.34(1)(fa); consequently, the s.34(4) request represents a proper approach. On the other hand, where the Act empowers the Commissioner to deal with questions of obtaining, it also empowers him to provide a remedy where obtaining is found (cf ss.60(3) and 68B(4)): in each case that remedy is to grant to the person concerned a patent or a petty patent (as the case may be) ... "on application made in accordance with the provisions of this Act ...". That is, the remedy requires a new application to be made by the person from whom the invention was obtained, and does not involve transfer of title to the rights of the application in suit, as does the operation of s.34(4).
Richard John Johnson (one of the four applicants) is the natural person who represents Johnson's Explosives in this action. As Managing Director of that company, he is the motivating force behind the s.34(4) request. He declares that he instructed Mr Fritz to investigate the possibility of developing a low density ammonium nitrate based explosive composition : that Mr Willems assisted Mr Fritz in this and that during the period of development of the new composition, he (Johnson)*, Fritz, Willems and Hall had discussions during which all parties made suggestions and offered contributions towards the development of the invention. Further, Mr Johnson has stated that as the mixing and firing of explosives must be done under license, and his company held the license, it is most probable that these people used company time and material whilst working on the invention. Mr Johnson has made assertions which, if correct, would make Johnson's Explosives a person entitled to any patent which might issue on the application in suit. Exhibited to the declarations of Messrs Fritz and Willems are copies of employment agreements with Johnson's Explosives each signed by Richard John Johnson and Fritz or Willems. It does not appear to be in dispute that the copies are copies of the actual agreements. Mr Fritz's agreement includes the following statements:
"(1). The employee is hereby engaged to perform the functions of plant manager for the employer at the employer's Peak Downs explosives manufacturing facility.
(2). In this capacity, the employee will accept the responsibility for supervision of all plant associated activities, including (a) Raw Materials Inventory, (b) Production, (c) storage and distribution of finished product, (d) Maintenance of Plant equipment, (e) Safety, and (f) supervision of wage roll employees ..."
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* i.e. in his capacity as Managing Director of Johnson's
Explosives
Mr Willem's agreement includes substantially identical statements to those above. Also in evidence is information to the
effect that Johnson's Explosives were manufacturing water-gel explosives (as distinct from ANFO) under license. In view of this and having regard to the employment agreements of Willems and Fritz, it seems unlikely to me that Mr Johnson would have required either of those two individuals to work on the development of an ANFO explosive. Further, Mr Johnson has indicated that it was "most probable" that Fritz and Willems used his Company's license, property and materials for their work on the ANFO. Messrs Fritz and Willems have denied this, and have tendered in evidence copies of letters from the Queensland Department of Mines which indicate that they were granted limited permission to trial their new explosive at the Riverside Mine.
Consequently, I have not before me any evidence which supports Mr Fisher's submissions about a master/servant relationship existing between Fritz and Willems in respect of the ANFO. On the evidence, it appears to me that the latter initiated and conducted the project themselves, substantially from beginning to end. In my view, on the balance of probabilities on the evidence before me, the situation may be summarised as follows:.Fritz and Willems began the development of the ANFO on their own initiative;
.such development work was outside the scope of their normal duties at Johnson's Explosives;
.Fritz and Willems made their own arrangements for a trial license for test firing their ANFO; they did not use Company material or property in doing so.
I conclude that Johnson's Explosives would not be entitled to any patent which might issue on the application in suit, and I refuse to action the s.34(4) request.
Section 63
When Messrs Fritz and Willems had joined Johnson's Explosives, Malcolm Hall was the Sales Manager. According to both Mr Fritz and Mr Willems, they approached Mr Hall about their invention, who suggested they should also involve Mr Johnson. Thus Mr Willems declares:
"In mid to late November, Alan and I decided to ask Malcolm Hall to join us in exploiting this invention, and offer him an equal share. When we approached him, he accepted, but suggested that as Dick Johnson was our employer, was regarded by each of us as a friend, had business influence and would probably actively support this venture as he was earnestly endeavouring to sell his company, we should invite him to share in it as well. Alan and I agreed to this suggestion."
This could explain how all four disputants came to be applicants, although, as I have pointed out above, Mr Johnson deposes differently. Nevertheless, Mr Johnson claims to have mistakenly signed the declaration for the patent application. He says he was used to signing papers put before him by Mr Hall - without checking - as the latter was a competent manager : additionally, the company was experiencing some difficulties at that time, and his mind was elsewhere. Even so, apart from his writing the letter of 25 February 1987 (see the summary of events earlier in this decision) to Messrs Fritz, Willems and Hall, he apparently took no action until the filing of the s.34(4) request on 20 March 1989. He took no action to ensure that the application remained alive - he admits having nothing to do with the preparation and filing of the complete specification. According to the applicants under s.63, Mr Johnson is now refusing to proceed with the application because he will not sign the new declaration which the Patent Attorneys have prepared. This declaration sets out that only Messrs Fritz and Willems are the inventors. The parties to this action have variously presented inconsistent reasons as to why all four were applicants, and were also named as inventors. On the evidence before me (see for example the extract from the Willems declaration under the s.63 heading), it is clear that there was an implicit assignment from Messrs Fritz and Willems to Messrs Hall and Johnson. Also on the evidence before me, I can only conclude that Messrs Fritz and Willems are the actual inventors, and no others. If the application is to proceed in due course to acceptance, the new declaration will be required, made by all four of the applicants, and correctly naming the inventors. Mr Johnson would need to sign this declaration, as he is one of the applicants, and will remain so, in accordance with my earlier determination not to action the s.34(4) request. If Mr Johnson refuses to sign the new declaration, he could of course, appeal this decision : the alternative is that I will direct that the application is to proceed only in the names of Fritz, Willems and Hall.
Finally, it was put to me at the hearing that Mr Hall was no longer interested in the patent application. If this is so, his correct procedure is to make a written assignment favouring the remaining applicants, or such of them as he chooses to assign his share in the application.
Conclusion
I have found that Johnson's Explosives is not a person entitled to a patent should one issue on the disputed application, and consequently, I have refused to action the s.34(4) request. In addition I have found that Mr Johnson is refusing to proceed (in terms of s.63) with the application. As a result, I direct that either Mr Johnson is to sign the appropriate declaration - which is then to be filed within two months of this decision - or at the expiry of that time (subject to any appeal), I will direct that he be removed as an applicant, and the application proceed in the names of the other parties to this action.
On the question of costs, I award that portion attributable to the s.34 action, against Johnson's Explosives, and that portion attributable to the s.63 action, against Mr R.J. Johnson.
(J.L. ROVETA)
Delegate of the Commissioner of Patents
Patent Attorneys for Messrs Willems and Hall - Shelston Waters
Patent Attorneys for Mr Johnson and
Johnson's Explosives - G.R. Cullen & Co
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