Machinery Developments Limited v Sealed Air Corporation

[2004] FCA 1202

FEDERAL COURT OF AUSTRALIA

Machinery Developments Limited v Sealed Air Corporation [2004] FCA 1202

MACHINERY DEVELOPMENTS LIMITED v SEALED AIR CORPORATION
N 709 OF 2003

PECHINEY PLASTIC PACKAGING INCORPORATED & ORS v
CRYOVAC AUSTRALIA LTD
N 167 OF 2003

TAMBERLIN J
SYDNEY
19 AUGUST 2004

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 709 OF 2003

BETWEEN:	MACHINERY DEVELOPMENTS LIMITED APPLICANT
AND:	SEALED AIR CORPORATION RESPONDENT
N 167 OF 2003
BETWEEN:	PECHINEY PLASTIC PACKAGING INCORPORATED & ORS APPLICANT
AND:	CRYOVAC AUSTRALIA LIMITED RESPONDENT
JUDGE:	TAMBERLIN J
DATE OF ORDER:	19 AUGUST 2004
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

Orders are made in accordance with the short minutes of order prepared by the applicants to proceedings N167 of 2003 (a copy of which is annexed hereto and marked “A”) and N709 of 2003 (a copy of which is annexed hereto and marked “B”).

THE COURT FURTHER ORDERS:

1.The costs in relation to the application the subject of Judgment [2004] FCA 925 be costs in the proceedings.

2.The respondents in matters N709/2003 and N167/2003 bear the costs of today’s directions hearing.

3The proceedings be stood over to 9.30 am on 5 November 2004.

4.   The parties have liberty to apply on two days’ notice.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 709 OF 2003

BETWEEN:	MACHINERY DEVELOPMENTS LIMITED APPLICANT
AND:	SEALED AIR CORPORATION RESPONDENT
N 167 OF 2003
BETWEEN:	PECHINEY PLASTIC PACKAGING INCORPORATED & ORS APPLICANT
AND:	CRYOVAC AUSTRALIA LTD RESPONDENT

JUDGE:	TAMBERLIN J
DATE:	19 AUGUST 2004
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1. These matters involve the finalisation of short minutes of orders to give effect to reasons for judgment given by me on 16 July 2004 (see [2004] FCA 925). Two points of dispute have arisen. That judgment concerned the delineation of categories of documents for discovery between the parties. I have been shown two sets of draft short minutes, and in relation to these I agree with the submissions and minutes that have been made by counsel for the applicants, Mr Dimitriadis, on both of the issues that have been raised.

   FIRST ISSUE: REFERENCE TO “RELATED BODY CORPORATE”

2. In relation to the first issue, which relate to both matters, I note that the reference to “related body corporate” was deleted in the preamble, and that in the body of the descriptions of the categories, the words "related body corporate" and "related body" are each referred to.  I take the expression "related body", where it is used on its own, to include or refer to any “related body corporate” as defined under the Corporations Law.

3. The intention in my reasons for judgment, where reference was made to a “related body”, was to encompass documents which are in the possession of the respondents, but which may originate or come from any related body corporate of the respondents.  Accordingly, I prefer the draft short minutes which have been prepared by Mr Dimitriadis, and I will make orders in accordance with those draft short minutes in each of the matters.

   SECOND ISSUE: COSTS

4. In relation to the costs of the proceeding in which I gave judgment, the order of the Court will be that the costs in that matter will be costs in the substantive or main proceedings and be awarded in accordance with the outcome of those proceedings.  So far as the costs of today are concerned, I consider the costs should be borne by the respondents and I so order.

   CONCLUSION

5. Short minutes of order have been handed to me in both matters.  I make orders in accordance with the short minutes submitted by Mr Dimitriadis and I stand the matters over for further directions at 9.30 a.m. on 5 November 2004.  I reserve liberty to apply on two days notice.

I certify that the preceding five (5) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin.

Associate:

Dated:             29 September 2004

Counsel for the Applicants:	Christian Dimitriadis
Solicitor for the Applicants:	Allens Arthur Robinson
Counsel for the Respondents:	Glenn McGowan
Solicitor for the Respondents:	Davies Collinson Cave
Date of Hearing:	19 August 2004
Date of Judgment:	19 August 2004

“A”

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

No N 167 of 2003

PECHINEY PLASTIC
PACKAGING INCORPORATED

First Applicant

DANAFLEX PACKAGING
CORPORATION LTD
(ACN 074 755 310)

Second Applicant

MACHINERY DEVELOPMENTS
LIMITED

Third Applicant

CRYOVAC AUSTRALIA PTY LTD
(ACN 004 207 532)

Respondent

CRYOVAC AUSTRALIA PTY LTD
(ACN 004 207 532)

Cross Claimant

MACHINERY DEVELOPMENTS
LIMITED

Cross Respondent

SHORT MINUTES OF ORDER

THE COURT ORDERS BY CONSENT THAT:

1. The parties give discovery in accordance with the attached categories on or before 15 October 2004
2. The parties entitled to inspect discovery documents inspect them, other than those
   for which a claim of privilege is made, within 14 days following discovery.

2

3.The proceeding be listed for further directions at 9.30 am on 5 November 2004 or an alternative date convenient to the Court.

4.        The parties have liberty to apply on 2 days notice.

Dated:             2004

........ ........ ........ ........ ........ ........ ...

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY

No N 167 of 2003

PECHINEY PLASTIC PACKAGING
INCORPORATED

First Applicant

DANAFLEX PACKAGING
CORPORATION LTD

(ACN 074 755 310)

Second Applicant

MACHINERY DEVELOPMENTS LIMITED

Third Applicant

CRYOVAC AUSTRALIA PTY LTD

(ACN 004 207 532)

Respondent

CRYOVAC AUSTRALIA PTY LTD
(ACN 004 207 532)

Cross Claimant

MACHINERY DEVELOPMENTS LIMITED

Cross Respondent

CATEGORIES OF DOCUMENT FOR DISCOVERY BY THE APPLICANTS

The Respondent/ Cross Claimant seeks discovery of all documents which are or have been in the possession, custody or control of the Applicants according to the following categories.

1.All documents relevant to, concerning or supporting the allegations of this infringement made in:

(a)      paragraph 9 of the Amended Statement of Claim;

(b)      paragraph 10 of the Amended Statement of Claim; and

(c)       paragraph 11 of the Amended Statement of Claim.

2

2.        All documents relevant to, concerning or supporting the allegations;

(a)that the First Applicant is the exclusive licensee of the patents in suit in respect of Australia as alleged in paragraph 7 of the Amended Statement of Claim and paragraph 1 of the Amended Reply;

(b)that the exclusive licence was royalty free as alleged in the Applicants' Solicitors' letter dated 16 May 2003 constituting their further and better particulars of their Statement of Claim;

(c)concerning (identifying which) circumstances when the First Applicant had the right to grant sub-licences to use and sell and make and have made products embodying the Invention in suit as alleged in the Applicants' Solicitors' said letter dated 16 May 2003.

3.All documents relevant to, concerning or supporting the allegation of authorisation by the First Applicant to the Second Applicant to distribute machines embodying the invention as alleged in paragraph 8 of the Amended Statement of Claim.

4.All documents relevant to, concerning or supporting the allegation of profits made by the Respondent referred to in paragraph 13 of the Amended Statement of Claim.

5.All documents upon which the Applicants intends to rely in support of the allegations that:

(a)       the First Applicant distributes packaging machines in Australia;

(b)the First Applicant distributes packaging machines in Australia through the Second Applicant; and

(c)the Second Applicant reports for operational purposes to the First Applicant,

as alleged in the Applicants' Solicitors' said letter dated 16 May 2003.

6.All documents which record or evidence work (including research work) associated with the conception and development of the alleged invention disclosed in Australian Petty Patent No. 742332 entitled "Packaging Apparatus".

7.All documents which record the use of the alleged invention disclosed in Australian Petty patent No. 742332 before 23 May 2001.

8.All documents which record or evidence any proposed, intended or actual trials, supply or use of the alleged invention described in Australian Petty Patent No. 742332 including any analysis, records, reports, assessments or discussions of such trials, supply or use before 23 May 2001.

3

9.All documents which record or evidence work (including research work) associated with the conception and development of the alleged invention disclosed in Australian Petty Patent No, 742380 entitled "Packaging Apparatus".

10.All documents which record the use of the alleged invention disclosed in Australian Petty Patent No. 742380 before 23 May 2001.

11.All documents which record or evidence any proposed, intended or actual trials, supply or use of the alleged invention described in Australian Petty Patent No. 742380 including any analysis, records, reports, assessments or discussions of such trials, supply or use before 23 May 2001.

12.All documents which record or evidence work (including research work) associated with the conception and development of the alleged invention disclosed in Australian Petty patent No. 742328 entitled "Packaging Apparatus".

13.All documents which record the use of the alleged invention disclosed in Australian Petty Patent No. 742328 before 23 May 2001.

14.All documents which record or evidence any proposed, intended or actual trials, supply or use of the alleged invention described in Australian Petty Patent No. 742328 including any analysis and any records, reports, assessments or discussions of such trials, supply or use before 23 May 2001.

15. All documents relating to the drafting, filing and prosecution of Australian Petty Patents Nos. 742332, 742380 and 742328, and any corresponding or related patent or pending applicants in Australia.

16.All documents relating to any proceedings (including but not limited to any opposition or revocation proceedings) in an Australian Court or before the Australian Patents Office challenging the validity of patents or patent applications related to or corresponding to any of the Petty Patents in suit in this proceeding.

17. In relation to paragraphs (II)(B)(i) and (III)(D)(i) of the Respondent's Amended Particulars of Invalidity, all documents relating to the "Series II" MDL bagging machine, including but not limited to the following documents which record or evidence:

(a)work (including research work) associated with conception and development of the "Series II" MDL bagging machine;

(b)any proposed, intended or actual field trials of the "Series II" MDL bagging machine;

(c)the supply or use of the "Series 11" MDL bagging machine before 23 May 2001; and

(d)the supply or use of the "Series II" MDL bagging machine at the South Burnett Meat Works, Murgon Queensland.

18.In relation to paragraph (II)(A)(ii) of the Respondent's Amended Particulars of Invalidity, all documents relating to the "Bagger I" MDL bagging machine, including but not limited to the following documents which record or evidence:

(a)work (including research work) associated with conception and development of the "Bagger I" MDL bagging machine;

(b)any proposed, intended or actual field trials of the "Bagger I" MDL bagging machine; and

(c)the supply or use of the "Bagger I" MDL bagging machine before 23 May 2001.

19. All documents dated before 23 May 2001 which disclose or refer to the development, mechanical configuration, operation, or use, of equipment or equipment systems that involved or were part of the development process leading directly or indirectly to the apparatus or the invention the subject of the claims in suit.

20.      All documents recording or referring to:

(a)any comment on or assessment or analysis of any of the publications particularised in the Amended Particulars of Invalidity;

(b)any search, study or opinion by, at the request of or on behalf of the Applicants as to the validity or enforceability of the petty patents in suit on any grounds falling within the Amended Particulars of Invalidity; or

(c)any test or evaluation by, at the request of, or on behalf of, the Applicants, to assess or determine the validity or enforceability of the petty patents in suit on any ground falling within the Amended Particulars of Invalidity.

21.All documents the Applicants intend to rely upon in support of their claims and in defence of their cross-claim against the Respondent.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY

No N 167 of 2003

PECHINEY PLASTIC PACKAGING
INCORPORATED

First Applicant

DANAFLEX PACKAGING
CORPORATION LTD

(ACN 074 755 310)

Second Applicant

MACHINERY DEVELOPMENTS LIMITED

Third Applicant

CRYOVAC AUSTRALIA PTY LTD
(ACN 004 207 532)

Respondent

CRYOVAC AUSTRALIA PTY LTD
(ACN 004 207 532)

Cross Claimant

MACHINERY DEVELOPMENTS LIMITED

Cross Respondent

CATEGORIES OF DOCUMENTS FOR DISCOVERY BY THE RESPONDENT/CROSS CLAIMANT

In this document, the following definitions and interpretations apply:

A.Except as otherwise indicated, this document adopts the terminology used in the Applicants' Amended Statement of Claim dated 11 November 2003.

B.The meaning of general words is not limited by specific examples introduced by the word "including".

C.       "Document" has the meaning given to it in section 3 of the Evidence Act 1995 (Cth).

D."Particulars of Invalidity" means the Amended Particulars of Invalidity of the Cross Claimant dated 15 March 2004.

E."Packaging Apparatus" means packaging apparatus for the automatic making and dispensing of variable length bags from roll-stock tubing for packaging meat including the FlexiBag M501 machine but to avoid any doubt excluding the FlexiBag System 300 machine and the FlexiBag System 500 machine.

F.        "Patent Area" has the meaning given to it in section 3 of the Patents Act 1990 (Cth).

G        "Petty Patents" means:

(a)Australian Petty Patent No 742332, for an invention entitled Packaging Apparatus for a term of 12 months commencing on 22 November 2001;

(a)Australian Petty Patent No 742380, for an invention entitled Packaging Apparatus for a term of 12 months commencing on 22 November 2001; and

(b)Australian Petty Patent No 742328 for an invention entitled Packaging Apparatus for a term of 12 months commencing on 22 November 2001.

H.       "Priority Date" means 26 March 1993.

I."Related Body Corporate" means, in relation to a body corporate, a body corporate which is related to it within the meaning of section 50 of the Corporations Act 2001 (Cth).

The Applicants / Cross Respondent seek discovery of all Documents that are or have been in the possession, custody or power of the Respondent / Cross Claimant in the following categories:

1All Documents recording, referring to or relating to the design, working, operation or mode of operation of each type or model of Packaging Apparatus:

(c)        made, hired, sold or otherwise disposed of;
(d)        offered for manufacture, sale, hire or other disposal of;
(e)        used or imported; or
(f)         kept for the purpose of doing any of the things in paragraphs (a) to (c),

by or on behalf of the Respondent /Cross Claimant in the Patent Area in the period from 22 November 2001 onwards including software, installation manuals, system manuals, checklists, plans, layouts, specifications, diagrams, operating manuals and service manuals.

2.All Documents recording the use, operation, service, maintenance or repair of each type or model of Packaging Apparatus:

(g)       made, hired, sold or otherwise disposed of;

(h)offered for manufacture, sale, hire or other disposal of;

(i)used or imported; or

j)         kept for the purpose of doing any of the things in paragraphs (a) to (c),

by or on behalf of the Respondent /Cross Claimant in the Patent Area in the period from 22 November 2001 onwards, including software, installation manuals, system manuals, checklists, plans, layouts, specifications, diagrams, operating manuals and service manuals.

3.All Documents recording responses to requests for tender, responses to tenders, offers for sale, or promotional, advertising or marketing information, relating to each type or model of Packaging Apparatus:

(a)        made, hired, sold or otherwise disposed of;

(b)offered for manufacture, sale, hire or other disposal of;

(c)used or imported; or

(d)        kept for the purpose of doing any of the things in paragraphs (a) to (c),

by or on behalf of the Respondent / Cross Claimant in the Patent Area after the Priority Date.

4.        All Documents recording each:

(a)       manufacture;
(b)       importation;
(c)       sale;
(d)       hire;
(e)       supply;
(f)        other disposal; or
(g)       offer to do any of the things in paragraphs (a) to (f),

of each type or model of Packaging Apparatus, by or on behalf of the Respondent/ Cross Claimant in the Patent Area after the Priority Date, including order forms, invoices, consignment notes, delivery notes and sales records.

5.        All Documents recording each:

(a)       sale;
(b)      supply; or
(c)      other disposal,
of plastic film for use with any Packaging Apparatus, by or on behalf of the Respondent / Cross Claimant in the Patent Area in the period from 22 November 2001 onwards including order forms, invoices, consignment notes, delivery notes and sales records but excluding routine documents which do not bear on the liability issue.

6.All Documents recording or referring to any research, development, design, testing, evaluation or studies conducted by or on behalf of the Respondent / Cross Claimant or any Related Body Corporate of the Respondent / Cross Claimant in relation to the design, manufacture, reduction to practice and operation of each Packaging Apparatus, including inventors' notes, research records and notebooks, patents, publications and manuscripts of publications.

7.All Documents recording or referring to any evaluation of developments associated with the automatic production on demand of variable length bags from roll-stock tubing for packaging variable cuts of meat and improvements which could be made to address such developments.

8.        All Documents recording or referring to:

(a)any comment on or assessment or analysis of any of the publications particularised in the Particulars of Invalidity;

(b)any search, study or opinion by, at the request of, or on behalf of, the Respondent / Cross Claimant or any Related Body Corporate of the Respondent / Cross Claimant, as to the validity or enforceability of the Petty Patents on any ground falling within the Particulars of Invalidity; or

(c)any test or evaluation by, at the request of, or on behalf of, the Respondent / Cross Claimant or any Related Body Corporate of the Respondent / Cross Claimant, to assess or determine the validity or enforceability of the Petty Patents on any ground failing within the Particulars of Invalidity.

9.All Documents recording, referring to, or referred to in the course of evaluating or determining the infringement by the Respondent / Cross Claimant or any Related Body Corporate of the Respondent / Cross Claimant of the Petty Patents.

10.      All Documents that the Respondent / Cross Claimant intends to rely upon at trial.

“B”

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

No N 709 of 2003

MACHINERY DEVELOPMENTS LIMITED

Applicant

CRYOVAC AUSTRALIA PTY LTD ACN 004 207 532)

Respondent

SHORT MINUTES OF ORDER

THE COURT ORDERS THAT:

1.The parties give discovery in accordance with the attached categories on or before 15 October 2004.

2.The parties entitled to inspect discovered documents inspect them, other than those for which a claim of privilege is made, within 14 days following discovery.

3.The proceeding be listed for further directions at 9.30am on 5 November 2004 or an alternative date convenient to the Court.

4.        The parties have liberty to apply on 2 days' notice.

Filed on behalf of:  the Applicant

Allens Arthur Robinson
Lawyers
The Chifley Tower  DX 105, Sydney
2 Chifley Square  Tel [phone]            Fax [phone]
Sydney NSW 2000  Ref PEZS 205082313:XOBS

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

No N 709 of 2003

MACHINERY DEVELOPMENTS LIMITED

Applicant

CRYOVAC AUSTRALIA PTY LTD
(ACN 004 207 532)

Respondent

CATEGORIES OF DOCUMENTS FOR DISCOVERY BY THE APPLICANT

The Respondent seeks discovery of all documents which are or have been in the possession, custody or control of the Applicant according to the following categories.

1.        All documents relating to the drafting and filing of Australian Patent Application

No. 686 608 and any corresponding or related patent or pending application in Australia.

2.All documents relating to any proceedings before the Australian Patents Office relating to Australian Patent Application No. 686 608.

3.        All documents recording or referring to:

(a) any comment on or assessment or analysis of any of the publications in the Amended Respondent's Grounds of Particulars in Opposition to the Grant of Australian Patent No. 686 608 and in Support of Cross-Appeal;

(b)any search, study or opinion by, at the request of, or on behalf of the Applicant, as to the validity or enforceability of the complete specification of Australian Patent Application No. 686 608 on any ground falling within the Amended Respondent's Grounds of Particulars in Opposition to the Grant of Australian Patent No. 686 608 and in Support of Cross-Appeal, or

(c)any test or evaluation by, at the request, or on behalf of, the Application to assess or determine the validity or enforceability of the said patent application on any ground falling within the Amended Respondent's Grounds of Particulars in Opposition to the Grant of Australian Patent No. 686 608 and in Support of Cross-Appeal.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY  

No N 709 of 2003

MACHINERY DEVELOPMENTS LIMITED

Applicant

SEALED AIR CORPORATION

Respondent

CATEGORIES OF DOCUMENTS FOR DISCOVERY BY THE RESPONDENT

In this document, the following definitions and interpretations apply:

A.The meaning of general words is not limited by specific examples introduced by the word "including".

B."Document" has the meaning given to it in section 3 of the Evidence Ac 1995 (Cth).

C."Grounds and Particulars" means the Amended Respondent's Grounds and Particulars in Opposition to the Grant of Australian Patent No. 686608 dated 15 March 2004.

D."Packaging Apparatus" means packaging apparatus for the automatic making and dispensing of variable length bags from roll-stock tubing for packaging meat including the FlexiBag M501 machine but to avoid any doubt excluding the FlexiBag System 300 machine and the FlexiBag System 500 machine.

E."Patent" means Australian Patent No 686608 for an invention entitled Packaging Apparatus.

F."Patent Area" has the meaning given to it in section 3 of the Patents Act 1990 (Cth).

G.       "Priority Date" means 26 March 1993.

H."Related Body Corporate" means, in relation to a body corporate, a body corporate which is related to it within the meaning of section 50 of the Corporations Act 2001 (Cth).

The Applicant seeks discovery of all Documents that are or have been in the possession, custody or power of the Respondent in the following categories:

1.All Documents recording or referring to any research, development, design, testing, evaluation or studies conducted by or on behalf of the Respondent or any Related Body Corporate of the Respondent in relation to the design, manufacture, reduction to practice and operation of each Packaging Apparatus, including inventors' notes, research records and notebooks, patents, publications and manuscripts of publications.

2.All Documents recording or referring to any evaluation of developments associated with the automatic production on demand of variable length bags from roll-stock tubing for packaging variable cuts of meat and any improvements which could be made to address such developments.

3.All Documents recording or referring to:

(a)any comment on or assessment or analysis of any of the publications particularised in the Grounds and Particulars;

(b)any search, study or opinion by, at the request of, or on behalf of, the Respondent or any Related Body Corporate of the Respondent, as to the validity or enforceability of the Patent on any ground falling within the Grounds and Particulars; or

(c)any test or evaluation by, at the request of, or on behalf of, the Respondent or any Related Body Corporate of the Respondent, to assess or determine the validity or enforceability of the Patent on any ground falling within the Grounds and Particulars.

4.        All Documents that the Respondent intends to rely upon at trial.