Lockwood Security Products Pty Ltd v Doric Products Pty Ltd

[2003] HCATrans 540

[2003] HCATrans 540

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S106 of 2003

B e t w e e n -

LOCKWOOD SECURITY PRODUCTS PTY LTD

Applicant

and

DORIC PRODUCTS PTY LTD

Respondent

Application for special leave to appeal

GUMMOW J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 12 DECEMBER 2003, AT 10.43 AM

Copyright in the High Court of Australia

MR A.J.L. BANNON, SC:   If the Court pleases, I appear for the applicant with my learned friends, MR S.C.G. BURLEY, and MS J.E. THORNTON.  (instructed by Phillips Ormonde & Fitzpatrick)

MR D.K. CATTERNS, QC:   May it please the Court, I appear with my learned friend, MS S.J. GODDARD, for the respondent.  (instructed by Spruson & Ferguson Lawyers)

GUMMOW J:   We thought we would be interested in hearing from you first, Mr Catterns.

MR CATTERNS:   May it please the Court.  Your Honours, we respectfully submit there is no dispute between us about the two principles which flow ‑ ‑ ‑

GUMMOW J:   It is a visitation case, if it is anything.

MR CATTERNS:   I beg your pardon, your Honour?

GUMMOW J:   It is what Sir Gerard Brennan used to call a visitation case.

MR CATTERNS:   A visitation of the principles, does your Honour mean?

GUMMOW J:   No, visitation on courts below – encourage them to do their work properly.

MR CATTERNS:   I respectfully submit that beginning from his Honour Justice Hely their Honours did, although I accept that two of the three decisions in the Full Court were terse, but may I just start with the basic principles which your Honours are both of course well familiar with.  We start with section 40(3), if I may take your Honours to that quickly.

GUMMOW J:   No.  You just take it we have been pondering this patent.

MR CATTERNS:   Yes, your Honour.

GUMMOW J:   Why do you not take us to the text and show us how it is as plain as a pikestaff that there cannot be fair basing of claim 1 in the body of this specification.

MR CATTERNS:   Certainly, your Honour.  Page 3, the patentee is described, the latch assemblies for the doors, in terms which, as your Honours would appreciate, are a description of it as being of common general knowledge.  They:

commonly include a turn knob or handle which is generally located . . . to withdraw the latch bolt into its casing.  In order to improve the security of such assemblies, manufacturers have included a key operated lock . . . Such locks are typically arranged so as to be operated from the inside of the door –

that is the deadlock, your Honours know, but then an admission of the problem:

In particular, key operation of the latch from the outside of the door will not release the lock.

I am looking at line 14 on page 3.  Your Honours, it is apparent on the face of the specification, and their Honours did not go past it for the current purposes, that the adventive step asserted is to cross out the “not” because the integer that we all argue about is that key operation of the latch from the outside of the door will release the lock.  That is made clear in the very next paragraph:

It is an object of the present invention to provide a key controlled latch which can be released from a locked condition by use of a key at the outside –

This happens twice more, your Honours.  In line 29 the specification admits ‑ ‑ ‑

GUMMOW J:   Just a minute.  So you fix on the word “can” do you, in line 16?

MR CATTERNS:   Yes, your Honour, as distinct from “will not”.  Does your Honour see in line 14:

key operation of the latch from the outside of the door will not release the lock.

GUMMOW J:   Yes.

MR CATTERNS:   That is the problem.  You come home, you turn the key and it is still deadlocked.  You throw the key on the kitchen table.  The house burns down and you cannot get out.  That is caused because when you turn the key on the outside it does not undo the deadlock.  So the inventive step on the face of the specification – not outside the specification – is to replace “will not” in line 14 with “can” in line 19, and I will make this good again, your Honours.  In line 29:

In normal latch assemblies of the foregoing kind–

“normal” is all the talk of common general knowledge on the face of the specification –

operation of the outer or second actuator does not affect the operation of the locking means.

That is the same problem restated.  Then, your Honours, the same problem is restated a third time on page 4, line 5 of the book:

The second or outer actuator may also include a key operated tumbler lock, but in conventional assemblies of the foregoing kind operation of that lock does not influence operation of the first actuator locking means.

That is the third time the problem is stated.  The solution is stated for the second time in line 10:

According to the present invention, a latch assembly of the foregoing kind is characterised in that it includes lock release means which is responsive to operation of the second actuator –

Now, your Honours, that is the integer we are arguing about.  That is called the “lock release means”.  Your Honour, instead of the key not releasing the deadlock, it does, and the inventive step on the face of this specification is that – if your Honours would go to the claims on page 13, the integer is line 9.  It is common ground that the first five integers there are common general knowledge, as indeed page 1 has described it as a typical lock release means.

GUMMOW J:   Just a minute.  Where is claim 1, page ‑ ‑ ‑

MR CATTERNS:   Page 13, your Honour – 11 of the patent.

GUMMOW J:   Could you just take us through the integers?

MR CATTERNS:  

A latch assembly including, a casing –

all of these are admitted on page 1 to be known –

a latch bolt ‑ ‑ ‑

GUMMOW J:   Yes.  Just break up the claim, including ‑ ‑ ‑

MR CATTERNS:   Integer 1, your Honour:

A latch assembly including, a casing, a latch bolt mounted on the casing ‑ ‑ ‑

GUMMOW J:   …..

MR CATTERNS:   I am sorry, one is a casing, your Honour, that is integer 1.

GUMMOW J:   Integer 2 is the latch bolt.

MR CATTERNS:   Integer 2 is the latch bolt.

GUMMOW J:   Integer 3?

MR CATTERNS:   A first actuator operable from the in side.

GUMMOW J:   Yes.  Integer 4 is the locking means.

MR CATTERNS:   Integer 4 is the locking means – that is the deadlock on the inside.  Integer 5 is the second actuator operated from the outer side.  That is the outside key.  They are the five admitted integers.  Integer 6, your Honours, lock release means which is responsive to said operation.  So your Honours can see that the patentee has written in the broadest possible terms a claim to the solution of the admitted problem which is to remove the word “not”.  The admitted problem is that the lock release means is not responsive to said operation of the second actuator, that the claim is to every lock which is responsive.  Your Honours, that is precisely what travelling beyond, as ‑ ‑ ‑

GUMMOW J:   I am sorry.  Integer 6, and then in the body of the specification, page 4, line 10, which you took us to.

MR CATTERNS:   Yes, your Honour.  That is it.  That is the integer.

GUMMOW J:   Yes.

MR CATTERNS:   So what they are saying is, “We have provided you – there is a known problem, which is that the outside lock does not undo the deadlock” ‑ ‑ ‑

GUMMOW J:   Yes.  We are just worried about bare basics.

MR CATTERNS:   Yes, your Honour.  But Sir Garfield Barwick in Olin when he looked at the question of “travelled beyond” looked at what the disclosure was, what the invention was in the disclosure, and he held ‑ ‑ ‑

GUMMOW J:   Yes.  All I am saying to you is integer 6 seems to be disclosed on page 4, line 10.

MR CATTERNS:   Of course it is disclosed but, as your Honour has said in numerous cases, the question is real and reasonably clear disclosure so as to support the breadth of claim, and does the claim travel – of course the words match.  There is no doubt the words match, but the law of fair basis, when the courts look at the question of a real and reasonably clear disclosure, they look at what is the true disclosure here, not as a matter of consideration, we accept, your Honour.

GUMMOW J:   It says “is characterised in that it includes”.  They are well‑known ways of highlighting the point, are they not?

MR CATTERNS:   Of course they are, your Honour, but the question here is, does this claim ‑ ‑ ‑

GUMMOW J:   According to the affidavit that has been put on in aid of the special leave application, that is the way attorneys have drafted these things for yonks.

MR CATTERNS:   Your Honour, we all know that attorneys try to draft as broadly as they can.  Sometimes they get away with it and sometimes they cannot.  The question that the courts have, as recently as Kimberly‑Clark, restated is, is the claim allowed to travel beyond?  When one looks at, as your Honour said four or five times, if I may say so, with respect, at the real and reasonably clear disclosure, one looks at what is really disclosed.  What is really disclosed here is a very pretty mechanism with springs and cams and hooks and a trigger which converted the known lock so that you have a lock release means.  So our learned friends have provided a single means of solving the known problem.

Your Honour, it has never been the law of fair basis that merely to articulate a problem and say, “Here is one way of solving it”, gives you the monopoly on all ways of solving it.  It has never been the law.  Dunlop Perdriau makes that clear.  Your Honour remembers that is what the High Court said in Olin, all Justices, although they disagreed on the facts.  That is what the House of Lords says in Biogen v Medeva.

It goes back to Morse’s Case in the US.  He invented one way of sending messages at a distance by wires.  This is cited in Biogen v Medeva.  Claim 8 says, “I claim all ways of sending numbers, figures and words at a distance by wire”, held by the Supreme Court of the US you cannot do that.  You must be limited to what you have in fact truly, real and reasonably disclosed.  Of course those words match.  They are the words of the integer.  We all know there is a consistory clause in every patent, your Honour.  It cannot be the case that you support broad claims by merely writing broad consistory clauses.

That is why your Honour says, with respect, picking up Justice Fullagher and Chief Justice Gibbs, what is the real and reasonably clear disclosure.  Four judges have held, rightly, that the real and reasonably clear disclosure here is of a single embodiment to solve the known problem.  The known problem was to provide lock release means where it was known that they did not have it in the past.  That is why no question of principle or, if I may use a cheeky word, your Honours, disciplining the courts arises.  His Honour Justice Hely expressed the matter completely correctly, applying the correct tests.

GUMMOW J:   He seems to have used this expression “inventive merit”.

MR CATTERNS:   But, your Honour, all of the cases, including Sir Garfield – that is a phrase that comes from Mullard v Philco.

GUMMOW J:   Yes, I know.  In Mullard v Philco, just to slow down for a minute, is before the statutory statement of this principle in the 1952 Act.

MR CATTERNS:   Absolutely right, your Honour, and the Full Court in which your Honour was a member ‑ ‑ ‑

GUMMOW J:   It somewhat ranges over the field, the House of Lords does.

MR CATTERNS:   And drifts, your Honour, I accept, into obviousness.

GUMMOW J:   It drifts and – just listen to me; it is a good idea – one object of the 1952 Act was to deal with the drift by making it clear, breaking it up, having the concepts distinct.

MR CATTERNS:   I could not agree more, your Honour.

GUMMOW J:   If you say this has not any inventive merit, you can run your case on obviousness.

MR CATTERNS:   Precisely, your Honour.

GUMMOW J:   Which also had not been illuminated at the time of Mullard.

MR CATTERNS:   Fair enough.  Also, your Honour, they were confusing subject matter, I accept.

GUMMOW J:   Yes.  Insofar as we have reached this then, insofar as Justice Hely succumbed, no doubt under invitation, to this notion of inventive merit, it was a false invitation.

MR CATTERNS:   No, your Honour, because (a) he did not succumb, we submit, and (b) one has to look at the invention as ‑ ‑ ‑

GUMMOW J:   He refers to a passage in Blanco White 5^th edition which is much more clearly explained in the 4^th edition.

MR CATTERNS:   Yes, your Honour, but Blanco White says you look at the invention disclosed in the specification.  Blanco White does not say go outside the specification, because, as your Honours also pointed out previously, the question is this, section 40(3) says travel beyond – I beg your pardon – must be fairly based.  This is, after all, a question of statutory construction.

GUMMOW J:   I know.

MR CATTERNS:   Your Honour, that is why I am happy to leave aside even travels beyond or real and reasonably clear disclosure.

GUMMOW J:   Yes.

MR CATTERNS:   Section 40(3) says:

The claim or claims must be clear and succinct –

not relevant –

and fairly based on the matter described –

Your Honour of course knows, what is the matter described?  The answer is 40(2)(a) “describe the invention fully”.  So, your Honour, when their Honours use the phrase “inventive merit”, they are comparing the claim, 40(3) ‑ ‑ ‑

GUMMOW J:   There is no complaint here of best method, is there ‑ ‑ ‑

MR CATTERNS:   No, not at all, your Honour.  But what his Honour Justice Hely compared was the claim against that which was fully described, namely, the invention.  What that consisted of is (a) an assertion that if you take the “not” away from the known problem, in other words you provide the means, that would be a good thing, and secondly, what it really and reasonably did provide, your Honours, was a particular elegant embodiment.

Merely to say there is this known problem, solve it, we respectfully submit is not to provide a real and reasonably clear disclosure.  Surely it cannot be right that to have mere mirroring words such as a consistory clause or an assertion cannot give you fair basis.

GUMMOW J:   Consistory clauses have be around forever.

MR CATTERNS:   Yes, your Honour, and they do not give you fair basis because it is a real and reasonably clear disclosure.  The whole thing is read to see what disclosure do we get.  May I go to Justice Hely, your Honour?

GUMMOW J:   Yes.

MR CATTERNS:   Just quickly, your Honours, at page 82 ‑ ‑ ‑

GUMMOW J:   It is reported at 192 ALR 306. What paragraph?

MR CATTERNS:   I am sorry, your Honour, paragraph 231.  His Honour quotes what Sir Garfield says about not considering a matter of undue reward.  So he is not looking at a consideration matter, your Honour, but whether the claim “‘travels beyond’ the matter disclosed”, recently approved in Kimberly‑Clark, as your Honour recalls.  Then the submission is it travels beyond in that Lockwood has come up with ‑ ‑ ‑

GUMMOW J:   It is paragraph 236 that worries me.

MR CATTERNS:   Your Honour, if I can go there.  But, your Honour, may I first go to 233:

the House of Lords held that the breadth of a claim will exceed the technical contribution to the art embodied in the invention if it claims every way of achieving a result when it enabled only one way –

Your Honour, that has been the law for a long time.  Then his Honour in 234 rejects the idea of mere matching words.  Then in 235 his Honour says:

The structure of the specification in the present case refers to a known problem . . . The technical contribution to the art –

perhaps we could use different phrases, your Honour –

to borrow the language of Laddie J . . . is the disclosure that the solution to the problem is the use of the outside lock . . . coupled with the disclosure of one way of doing that –

Now, your Honour, that is what the real and reasonably clear disclosure was.  His Honour does, I accept, mention obviousness there and says:

However, the fair basis objection overlaps with other grounds of invalidity –

Of course they sometimes do, your Honour.  They are doctrinally separate.

GUMMOW J:   Obviously.  That is not the way his Honour ‑ ‑ ‑

MR CATTERNS:   Yes, your Honour, but the Blanco White passage says what he has said in his specification.  There is no suggestion of going outside the specification.  Then his Honour says:

I agree with Mr Catterns’ submissions that the specification does not contain a real and reasonably clear disclosure of matters broader than the particular embodiment.

That is to apply CCOM; that is to apply Rehm v Websters.

Yet the Patent claims a latch assembly which contains LRM –

of any form.  So, your Honour, we respectfully submit there is no error of approach in that paragraph.  It is a pity that “obviousness” is in the same sentence, I accept.  As Horatio would say, the fair basis matter followed hard upon the mention of obviousness, your Honour, but ‑ ‑ ‑

GUMMOW J:   It would have been more helpful if the Full Court had decided the whole of the grounds on the appeal.

MR CATTERNS:   I respectfully agree, your Honour, but we ‑ ‑ ‑

GUMMOW J:   We have said that now at least on two occasions, I think perhaps three, in the last seven or eight years.  It seems to fall on deaf ears.  Once you look at the whole of the issues, you get a better perception of how the patent works, what is in it, what is in the case.

MR CATTERNS:   Indeed, your Honour.  Perhaps the grounds might have been kept more separate.  I accept that in his Honour Justice Wilcox who is in paragraph 72 of the appeal – it is at 123 of the book.  His Honour there – I accept, the Horatio funeral baked meats problem occurs again in that the first two paragraphs are talking about inventive step, I accept, but then his Honour goes on to say:

I agree with Hely J that the specification “does not contain a real and reasonably clear disclosure of matters broader than the particular embodiment –

That is a perfectly correct analysis, your Honours.

GUMMOW J:   Look at the top of paragraph 69:

Discussion about fair basis, insufficiency and obviousness –

They are the last things you would roll together if you were writing a judgment in a patent case.

MR CATTERNS:   Your Honour, with respect, I agree.  It is a pity they were conflated, but doctrinally his Honour kept them apart. 

GUMMOW J:   It does not seem to be, but anyhow.

MR CATTERNS:   Her Honour Justice Branson first of all basically agrees with his Honour Justice Wilcox.

GUMMOW J:   Where does this phrase “inventive merit” pop up in the Full Court?  Is it in the Full Court?

MR CATTERNS:   It is Justice Merkel.  It is Justice Merkel, with respect, your Honour, whose analysis is utterly unimpeachable because his Honour does not make any mistake of conflating obviousness and other grounds.  He gets the merit – if your Honour would look at 99 from Lord Macmillan in Mullard.

GUMMOW J:   That is right.

MR CATTERNS:   Yes, but your Honour in CCOM did not say throw out Mullard; your Honour said approach Mullard with caution so that we do not descend into questions of consideration.  But look how his Honour uses it.

GUMMOW J:   Yes, I know that. 

MR CATTERNS:   His Honour says at paragraph 100, line 5:

The “merit” of the invention disclosed in the specification and the “real and reasonably clear” disclosure of the invention, concerns the

manner in which an outside actuator can achieve the object . . . But claim 1 does not claim protection for that –

that is the particular thing; it claims it broadly.  So, your Honour, we respectfully submit there has been no descent to some false approach.  Their Honours are applying the absolutely standard tests of travels beyond and real and reasonably clear disclosure and this is a clear case where they gave us one particular mechanism but claimed all when they admitted that the problem was known and the solution is merely to cross out the word or to add in the word “not”.  May it please the Court.

GUMMOW J:   Thank you.  Yes, Mr Bannon.  We do not want to hear about Mullard.  What do you say about the actual patent document, the construction issues that Mr Catterns says are disclosed?

MR BANNON:   The part on page 4 of the application book, line 10 is ‑ ‑ ‑

GUMMOW J:   He fixes first on page 3, line 18.  He says “can” and then above that “will not”.

MR BANNON:   Yes.

GUMMOW J:   Then we go in 4.

MR BANNON:   The problem which Justice Hely found to be the problem was the fact that you got locked inside.  His Honour said that the specification did not admit that there was a known problem that the outside actuator did fail to unlock the inside key.  His Honour said at page 77 of the application book, paragraph 211:

No witness deposes to the fact that it was understood at the priority date that a solution to the problem identified in the specification was to use the outside key to release the inside lock.

The effect of what my learned friend is putting to your Honours, and what he put below, was that you read the specification to say it was always known that the problem was that the outside key did not open the inside lock, but the problem was how to solve it.  What Justice Hely points out is that they called a number of people from the trade and not a single person said, “We’ve always known that but the problem was how to achieve it”.  So in the light of the evidence which goes to the issue of obviousness we say his point cannot stand.  His Honour also said at paragraph 202 of the judgment “does not contain any broader admission”.  At the end of the day my learned friend is trying to turn a ‑ ‑ ‑

GUMMOW J:   I do not understand that:

The specification does not admit that claim 1 is obvious.

MR BANNON:   My learned friend tried to suggest that parts that my learned friend has taken the Court to contains an admission that claim 1 is obvious.  His Honour rejected that as a matter of construction.

GUMMOW J:   Yes, I see.

MR BANNON:   But, importantly, reinforced by the evidence was nobody came forward to say that “We’ve always known about this problem”.  At the end of the day, he failed on obviousness.

GUMMOW J:   Yes, we understand that.  There is a novelty point still lurking around, is there not?

MR BANNON:   No.  There are 24 live claims.  In relation to five of them there is a live obviousness claim, in the sense that the Full Court has not decided.  In relation to the other 19 claims, they have given up on obviousness, so that if we are right on fair basis we will win but we will retain our patent for those 19 claims, leaving aside the outcome of any obviousness debate.

GUMMOW J:   Yes.

MR BANNON:   We also say five of those 19 claims are the subject of an undetermined infringement argument.  Justice Hely found against us but the Full Court did not consider it at all for the reasons which ‑ ‑ ‑

GUMMOW J:   Yes.

MR BANNON:   So that there is complete utility in the application.

GUMMOW J:   Could you just explain to us for a minute, Mr Bannon, how you say integer 6 in claim 1 is fairly based, or claim 1 insofar as it includes integer 6 is fairly based?

MR BANNON:   Because of the reference on page 4 of the application book.

GUMMOW J:   Your opponent says you cannot make it that simple.

MR BANNON:   Your Honour, one can.

GUMMOW J:   One cannot draft in that fashion, in effect he is saying.

MR BANNON:   Yes.  There is a limited ambiguity objection but that was failed and not pursued.  So what we have is an unambiguous definition of a combination which has been found to be an invention, or a series of combinations.  There was no argument on no matter of manufacture, so it is conceded, the Court must accept, it is not a statement of principle or a mere idea.  It is a physical integer producing a vendible product.

No one came forward to give evidence to say, “Given that information, I cannot make that product”.  Can I just take your Honour to what Justice Hely said on that particular matter at page 31, paragraph 17.  His Honour at the end of paragraph 17 refers to a part of the specification which says “The release means may take any suitable form”.  So it is absolutely clear that the asserted invention which was tested on the obviousness suit was the general form.  Then, in the continuation of the paragraph, his Honour says:

The words which I have emphasised convey that a person skilled in the art would have no difficulty in constructing this integer without the necessity for any instruction from the patentee.  The Patent does not have to teach how release means may be constructed as that is a matter within the knowledge of a skilled addressee . . . there is no allegation of insufficiency –

Can I just add this comment, your Honour.  One of the other integers of the patent is a locking means.  There is no further identification of locking means.  The patent is a combination which claims with those integers, including a locking means, any form of locking means.  There is nothing offensive about that.  One has to understand that combination patents only claim a combination of those integers.

We do not claim, for example, a monopoly of all forms of lock in the future which may be invented, but what we do claim is a lock which includes these features, even though it includes a new form of locking means which has not yet been invented.  “Thermo‑responsive means” was an expression used in the Frypan Case.  May forms of new thermo‑responsive means may be developed in the future.  It is not an offence against a combination of patent that you may have new developments of an individual integer which are included in the monopoly combination because the monopoly combination is not a patent for any development in the individual integer on its own.

GUMMOW J:   We understand that.

MR BANNON:   There is nothing offensive, that is all I am saying, about the matter.

GUMMOW J:   Yes, Mr Catterns.  Talk us out of this grant of leave that seems to be looming.

MR CATTERNS:   Your Honour, it is a waste of time, with respect, because there is no question of principle and it will turn upon whether our learned friends get away with the assertion on page 4 of the book, lines 10 to 12, which certainly match the claim.  Your Honour, our learned friends will not answer page 1 to 2 properly because they go to evidence or the lack of evidence.  If I may just go one more time to pages 3 or 4 of the book, it says at line 7:

Latch assemblies for doors commonly include –

this.

Such locks are typically arranged –

in such a way.

In particular, key operation . . . will not release the lock.

Solution in line 16:  make it so that it can release the lock.  Then again we have “A typical latch” – all of this is admissions of common general knowledge, your Honour.

In normal latch assemblies . . . operation . . . does not . . . It is usually the case –

They will generally do this.

but in conventional assemblies . . . operation of that lock does not influence operation –

Accordingly, let us make one which does. 

Now, your Honour, in the light of those admissions you cannot say that merely to solve that problem which is so plainly admitted – it is not a question of evidence; it is plainly admitted – merely to say, “I will solve that problem by any means you care to come up with” cannot provide fair basis, your Honour.  That is why this does not raise any question of principle.  It is not a matter of a question of principle that a mere assertion is not enough because the Court has held many times that the disclosure has to be real and reasonably clear and not a mere assertion.

Your Honour, of course this patent was sufficient.  It gave one embodiment – a beautiful, elegant, simple embodiment.  That is why there

was no question of sufficiency.  There is no question of utility because when you write a claim with a clause like the last one the result solves itself.  You are either in it or you are out.  So we respectfully submit there is no question of principle.  The courts have made it clear, including Full Courts of the Federal Court, what the tests are and the application to the particular case will not elucidate the law of fair basis.  May it please the Court.

GUMMOW J:   Yes, there will be a grant of leave in this matter.  A one‑day case, gentlemen?

MR BANNON:   Yes, your Honour.

GUMMOW J:   Very well.

AT 11.14 AM THE MATTER WAS CONCLUDED