L'Oreal v Bristol-Myers Company

[1991] APO 52

PATENTS ACT 1990

DECISION OF A DELEGATE OF THE COMMISSIONER OF PATENTS

Re:Application No. 547036 by L'OREAL and opposition by BRISTOL-MYERS COMPANY to an application for special leave under sub-regulation 59(1)(b) of the Patents Act 1952.

Background

The Office advertised acceptance of application number 547036 on 3 October 1985. Bristol-Myers Company (Bristol-Myers) opposed the grant of the patent.  The Notice of Opposition was served on 24 December 1985 and the normal evidence stages completed on 25 May 1989.

On 23 July 1990 a Delegate of the Commissioner granted an application for special leave under regulation 59 to lodge further evidence in answer to Bristol-Myers evidence-in-reply.  (see L'Oreal V Bristol-Myers (1991) AIPC 90-736))

The further evidence stages were completed on 22 November 1990.

The hearing, under section 59 of the Patents Act 1952, was set down for 20 February 1991 in Melbourne. Mr Louis Gebhardt, patent attorney of Watermark represented L'Oreal and Mr Paul Jones, patent attorney of Phillips, Ormonde & Fitzpatrick represented Bristol-Myers.

The Notice of Opposition lists the usual grounds available under section 59 and says "notwithstanding the generality of ground 8, that the invention is not fully described". At the hearing Mr Jones relied on grounds 8 and 9 of the Notice of Opposition, that is, of non-compliance with section 40.

At the hearing Mr Gebhardt sought permission to adduce further evidence on the matter.  Mr Jones refused to agree to the lodgement of the further evidence.  Mr Gebhardt decided to leave the matter to a later time.

An application for special leave to lodge further evidence was lodged on 7 May 1991.  A notice of opposition was lodged on 28 May 1991 by the opponent (Bristol-Myers) and the matter set down for hearing on 5 July 1991.

Application for special leave

The application for special leave was accompanied by a statutory declaration by Mr Gebhardt and an exhibit comprising a copy of a letter from the French patent attorney firm Cabinet Noni & Co to Mr Gebhardt.

The text of the letter is as follows:

"Dear Mr Gebhardt,

I make reference to your fax of 14th February 1991.

I have phoned to L'OREAL Patent Department and they told me that they had just discovered that the test protocole (sic) described in Mr LE TRUNG's Declaration was not the protocole which was used in fact.  How this error occurred is not understood.

In the Declaration, it is stated that the hair was subjected, after treatment, to 3 shampoos. and then the test was performed on dry hair.

But in fact, the results appearing in the Declaration correspond to a treatment according to the invention, without consecutive shampoos, and the test is performed on wet hair.

What do you recommend to do under the circumstances?

I regret the inconvenience caused to you for these late instructions.

Yours

faithfully,"

Mr Gebhardt declares:

2.    "THAT on 18 February I received a facsimile letter dated 15 February 1991 from L'Oreal's French instructing attorneys.  The letter advised that an inadvertent error was made by Declarant Do Le Trung in his Declaration when reporting the results on experiments carried out under his supervision in the L'Oreal laboratories.

3.    THAT I tabled the above letter at a Hearing held on 20 February 1991 in Melbourne in the form of a Declaration in my name but the tabled Declaration was rejected by the Hearing Officer on the ground that it was not introduced by way of "special leave".

4.    THAT I have since tried to introduce the evidence regarding the error made in the Le Trung Declaration under Regulation 59(1)(a) (viz. by agreement between the parties), however, I was advised by Messrs Ormonde & Fitzpatrick (sic) by a letter dated 27 March 1991 that their client was not prepared to consent to the "further evidence" regarding the error.

5.    THAT the further evidence merely seeks to explain the circumstances surrounding the commission of the error in the experimental data presented in the Le Trung Declaration.

6.    THAT it is in the public interest that the evidence adduced by the applicant in defence of its application be corrected in order to correctly reflect the experimental data obtained by the applicants declarant, Mr Do Le Trung.  As the evidence by Mr Le Trung currently stands it is defective as it appears to indicate the results obtained after a three shampoos post treatment and performed on dry hair whereas in fact the results given in the Le Trung Declaration were in respect of tests which did not involve such post treatment and the tests were carried out on wet hair."

Submissions for the applicant

In summary, Mr Gebhardt's major arguments in support of his application are as follows:

1. Mr Gebhardt referred me to paragraph 5.4 of the Patent, Trade Marks and Designs Offices' Hearings Manual and he read the text of this paragraph.

In summary, he said that:

the further evidence is relevant to the action in the sense that it would contribute to a more just and correct result.  The Le Trung declaration is defective as a result of an inadvertent mix up in connection with the data obtained by him from his experiments. The record should be corrected with reference to the applicant's evidence in relation to cationic polymers;

if the application for special leave were to be allowed it would not cause unnecessary protraction of the opposition because the declaration comprising the further evidence is ready for lodgement and service.  This declaration is a very minor declaration dealing with the circumstances surrounding inadvertent mix-up of data in the original Le Trung declaration;

there would be no injustice done to the opponent if the application were to be allowed because the evidence is simply to correct the inadvertent error in the Le Trung declaration.  The applicant is not attempting to introduce new evidence;

the applicant has been diligent in prosecuting the opposition action. The notice of opposition was served on 24 December 1985.  The evidence-in-support was served by the opponent on 1 June 1987. That is 18 months after the notice opposition.  The evidence-in-answer was served on 25 February 1988 only 8 months after the date of service of evidence in support.  Evidence-in-reply was served on 24 May 1989.  That is, 15 months after service of evidence-in-reply.  The opponent and the applicant were then involved in negotiations over the opposition, however, when this failed an application for special leave  was lodged and later granted for further evidence as the opponents evidence-in-reply was found to comprise new evidence.  Thus the delay occurred in relation to the lodgement of additional evidence was not the applicant's fault;

subsequent to the substantive hearing the applicant tried to settle the matter, associated with the error in the Le Trung declaration, under regulation 59(1)(a) but was not able to gain the consent of the opponent.  As soon as this was clear the applicant applied for special leave under regulation 59(1)(b). 

accordingly the applicant cannot be shown to be not diligent in prosecuting the action.

the applicant should be allowed to adduce further evidence "to set the record straight" as a matter of natural justice.

Mr Gebhardt argued that:

the evidence could not have been obtained at an earlier stage and the applicant had been diligent.  The error with the Le Trung evidence had only been discovered towards the end of the opposition proceedings.  Mr Gebhardt also said the applicant's wish to lodge further evidence was "fore-shadowed" at the previous hearing in February 1991.  There has not been a considerable delay, he said;

the evidence to be adduced clearly has an important effect on the prosecution of the applicant's case as the results apparently provided in the Le Trung declaration do not reflect correctly the circumstances under which these results were obtained.  The results were correct, Mr Gebhardt said, but they were obtained using no post treatment shampoos (after the conditioning) as indicated by the Le Trung declaration.  Post treatment shampooing is not called for in the specification and was not done, he said, on the basis if it works under the more severe conditions it will work "all the better" under the process of the specification (which is the normal procedure).  The results obtained with the post treatment shampooing were in fact not as good as those with the process described in the specification.  An honest mix-up had occurred, he said, resulting in the wrong results being used in the declaration;

the evidence is "apparently credible" in that Dr Wolfram himself noted in his final declaration there was something wrong with the results bearing in mind the circumstances regarding the post treatment allegedly carried out by Mr Le Trung.  It was quite clear to Dr Wolfram there was some sort of error with the results provided in the Le Trung declaration.

Mr Gebhardt also referred to the decision in Monsanto v ICI Ltd 1978 AOJP 3021 and an unreported decision of the Patent Office, International Flavours & Fragrances v Unilever Ltd (in the matter of patent application No. 461309) issued on 8 February 1979 in which applications to adduce further evidence, by the Applicant, were allowed.

Submissions for the opponent

In preliminary comments (that is, comments prior to his major submissions) Mr Jones:

sought to comment on the applicant's case by reference to Montecatini, Societa Generale Per l"industria Mineraria E Chemica v Eastman Kodak Co 1967 AOJP 151 at page 156.  Mr Jones said the facts in this decision approximated the facts in the present application.

The hearing officer in this decision said:

"As a preliminary I set out my reasons for refusing the application for special leave.  In considering the matter I took into account the fact that the application had been lodged at a late stage in the opposition proceedings, namely four years after the notice of opposition had been lodged.  In these circumstances, the utmost diligence in lodging the application was called for.  However, I found that the application for special leave had not been lodged until after ten months after advertisement of particulars of the request to amend the specification following my interim decision.  Further I have found it difficult to accept the opponent's arguments that the check experiments contemplated could not have been conducted until the form of the amended claims (limited to the physical characteristics of the polypropylene) had been made known.  It appeared to me that check experiments would have been equally relevant to the unamended claims, since the opponent's declarant regarded the reference to steric symmetry, deleted by the amendment, as being meaningless, and sought to show that the physical characteristics (which form part of the unamended claims) were 'not better than those of previously known isotactic polypropylenes'.  I considered also that the nature of the further evidence to be lodged was highly important.  If this were such as to be likely to be conclusive in determining the opposition, then, this might be a compelling reason why in the public interest I should take it into account, even at this late stage in the proceedings.  In the affidavit supporting the application, it is indicated that the further evidence would take the form, in the main, of check experiments of the examples in both the present specification and in the prior Montecatini specification previously cited.  I considered that such evidence would be unlikely to be conclusive of the grounds of opposition relied on.  Moreover, I considered that such evidence would evoke counter experiments by the applicant who would be entitled to lodge further evidence in opposition in accordance with the Patent Regulations and that a further hearing would then be necessary, thereby further protracting the opposition proceedings and increasing public uncertainty as to the ultimate grant of patent.  After carefully considering the arguments presented to me by the opposing Counsels, in the light of all the circumstances of the case, I decided for the reasons indicated above to refuse the application for special leave."

Mr Jones pointed out the present application was lodged five and one half years after the notice of opposition had been lodged.

Mr Jones also said in the present application:

we are here dealing with an application to introduce data on check experiments.  Results from experiments relating to the invention had been previously presented.  It proves nothing, he said, to go through a further set of experiments.  We are merely "tinkering at the margin";

the nature of the new evidence is not conclusive in determining the opposition.

Mr Jones argued that, in the present circumstances, that is, the evidence is to correct evidence previously adduced by the applicant, the burden is on the applicant to manifestly prove their case. 

Mr Jones also argued there is no basis in the Patent Act and Regulations for an application for special leave to fix up evidence adduced by way of a previous application for special leave.  This is not countenanced, he said, by regulation 59.

Mr Jones said the Montecatini v Eastman Kodak decision (supra) was followed in The Dupps Company v Stord Bartz 1990 AIPC 90-701. A critical factor in the Montecatini v Eastman Kodak decision, in the opinion of the hearing officer in the Dupps case was the delay of four years from the date of lodgement of the opposition.

A summary of Mr Jones' major submissions follows:

1. This matter proceeded along a relatively normal course of events until May 1989 when the opposition would have normally have been heard and hopefully been the subject of a final decision before the end of that year.  The applicant was then given a very long period to consider its position as the opponent thought the matter could be settled by negotiation.  Unfortunately that view was not shared by the applicant. 

1. In January 1990 the applicant's "out of the blue" made an application to serve further evidence by way of special leave.  This application was opposed by the opponent, but was successful, and the evidence by Mr Do Le Trung was served in September 1990.  Evidence-in-reply to that evidence was prepared at "break-neck speed" and was served by the opponent in November 1990 after the Commissioner allowed extensions of time under section 160(2)(b) of the 1952 Act.

1. The case then came up for the substantive opposition hearing in February 1991.  It was argued on behalf of the opponent's that the principle objective of the first application for special leave was to delay the opposition proceedings.

1. Significant delays have occurred as a result of the first application for special leave and the present application.  We are now, in this case, two years since the normal ending of the evidentiary process.  We are some five months after the substantive hearing of the opposition and the evidence is yet to be served and we are five and one half years since the notice of opposition has been lodged.  The question of delay according to the previously discussed authorities (The Dupps Company v Stord Bartz and Montecatini v Eastman Kodak decisions (supra)) is critical.

1. If the present application for special leave were granted then the opponent may be required to go to still further major effort and expense to prepare evidence-in-reply to this evidence entailing still further delays. 

1. A further hearing of the substantive opposition may also be required.

1. Such delays are contrary to the public interest and contrary to natural justice.

1. Mr Jones said he understood the further evidence to be the letter tendered with Mr Gebhardt's declaration accompanying the present application for special leave and the declaration itself.  He asked Mr Gebhardt whether this was the case or whether the evidence would take a different form.  Mr Jones argued the applicant could have introduced the evidence by way of special leave at the substantive opposition hearing.  He also argued the letter was not proper evidence as it was only a copy of correspondence between patent attorneys and was not supported by a statutory declaration from Mr Do Le Trung.  In answer to this point, Mr Gebhardt said the evidence will be a declaration by Do Le Trung incorporating what was in the letter.

1. The letter as it stands provides the opponent with no understanding of what is going on with this case.  The letter states the test protocols stated in the declaration were not the test protocols used in fact.  What the letter amounts to is a statement the evidence from Mr Do Le Trung was completely wrong.

Mr Jones referred to the decisions in:

.Sue v Carpenter 19 IPR 187, in which the criteria for an application for special leave were set out;

.Puren Agencies Pty Ltd v Barker (1984) APOR 23 where the hearing officer said, at page 26,

"The public interest considerations involve balancing the speedy resolution of all matters affecting a patent application against the requirement to grant a valid patent on that application.  One of the factors I have to consider is the time of the application for special leave in relation to the stage which the opposition has reached (American Flange and Manufacturing Co Inc v Rheem Australia Pty Ltd (1960) AOJP 1230 at 1231).  This has to be balanced against the nature of the evidence sought to be adduced which, if likely to be conclusive in determining the opposition, might be granted special leave at a late stage in the opposition (Montecatini v Eastman Kodak Co (1967) AOJP 151 at page 156).";

.Canadian Industries Ltd. v Australian Paper Manufacturers Ltd  (1981) AOJP 4565;

.Owens-Corning Fibreglas Corporation's Application (1972) RPC 684 where Graham J. said at page 690

"... it seem to me that the applicant's here have really brought the matter on themselves and, when they plead that their interests must be adequately safeguarded, one must also have in mind the fact that it is their own conduct which has put them in the position in which they now find themselves.  I consider .... that there would be undue delay caused in these proceedings if they were allowed to drag on any further.  The actual time which might be required for additional evidence may or may not be small, having regard to the time which has already elapsed; but, in all these cases where delay is of importance, there comes a time when one must draw the line or exercise one's powers with the hatchet and say: "This has gone on long enough".  In my judgement, that is so in this case." 

Mr Jones argued it was the applicant's conduct which has placed it in the position in which it now find itself;

.The Permutit Co Ltd's Application (1964) RPC 22 where the facts of that case were similar, he said, and where the application for special leave was refused;

.the decision in the first application for special leave to introduce further evidence in this matter (dated 23 July 1990) where the hearing officer said at page 12 after expressing some doubts in the matter

"Nevertheless in the circumstances of this case I am prepared to give the applicant the benefit of the doubt bearing in mind the following:   ". 

Mr Jones argued although the hearing officer properly gave the applicant the benefit of the doubt in that case this should not happen to such an extent that the onus placed on the opponent of proving the case becomes so burdensome as to "break the back of the opponent".

Decision

Mr Jones has argued the present circumstances, that is, an application for special leave to correct evidence previously adduced by way of an application to lodge further evidence by the same party, are not countenanced by regulation 59 of the Patents Act 1952. I can not, however, find anything in the Patent Act and Regulations or in the authorities which precludes the present circumstances.

The factors the Commissioner needs to consider when assessing an application for special leave to lodge further evidence are discussed in Sue v Carpenter (supra) and other authorities.

These factors are:

1. Is the evidence which it is proposed to adduce, based on the nature thereof and the grounds set out in the declaration, relevant to the action, in the sense that it would contribute to a more correct, just, or expeditious result?

1. If the application for special leave were to be allowed, would this cause unnecessary protraction of the opposition?

iii.Would there be any injustice done to the other party, if the application were to be allowed?

1. Has the party seeking to adduce the further evidence been diligent in prosecuting the opposition action?

I propose to consider the present application against each of these criteria and the reasons for my decisions are as follows.

In relation to the first factor I consider that although the proposed evidence is relevant to the proceedings it is not such as to contribute to a more correct, just or particularly a more expeditious result.  The applicant wishes to "set the record straight" by correcting the methodology described in Do Le Trung's declaration but apparently does not wish to change his test results or his conclusions.  I think a change to the facts about the testing process used by Do Le Trung without a change to his results or conclusions is unlikely to contribute to the granting of a valid patent on the application.  Thus, I do not think a more correct, just or expeditious result will be achieved by undertaking a further process of evidence, evidence-in-reply and possibly, another hearing.

In relation to the second factor I am of the opinion that proceedings have become unnecessarily protracted.  To quote Mr Jones "We are now, in this case, two years since the normal ending of the evidentiary process.  We are some five months after the substantive hearing of the opposition and the evidence is yet to be served and we are five and one half years since the notice of opposition has been lodged".  I believe the approach taken by the hearing officer in Montecatini, Societa Generale Per l"industria Mineraria E Chemica v Eastman Kodak Co (supra) applies here.  As I have already concluded, the nature of the evidence does not warrant further delay while evidence-in-reply is prepared, the matter possibly re-heard and a decision made. 

In relation to the third factor, I am of the opinion that although there would not be any injustice to the applicant, it would be unjust, because the extra evidence is unlikely to contribute to the granting of a valid patent, to put the opponent to further expense and effort to prepare evidence-in-reply.

In relation to the fourth factor, I am unable to decide, on the facts, whether the reasons for the delay can be attributed to either party.

After carefully considering the arguments presented to me and in the light of the circumstances of this case I have decided to refuse the application for special leave.  I award costs in this matter against the applicant.

Bob Sawyer

Delegate of the Commissioner of Patents

Patent Attorneys for the applicant:   Watermark, Melbourne

Patent Attorneys for the opponent :   Phillips, Ormonde & Fitzpatrick, Melbourne