Northern Territory v Collins [2008] HCA 49 16 October 2008 D2/2008
ORDER
1.Appeal allowed with costs.
2.Set aside the order of the Full Court of the Federal Court of Australia made on 20 September 2007 and in its place order that the appeal to that Court be dismissed with costs.
On appeal from the Federal Court of Australia
Representation
S J Gageler SC with G R Nicholson for the appellant (instructed by Clayton Utz Lawyers)
G O'L Reynolds SC with N R Murray and R C A Higgins for the respondents (instructed by De Silva Hebron)
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
CATCHWORDS
Northern Territory v Collins
Intellectual property – Patents – Infringement – Contributory infringement – Respondents owned patent for methods of producing oils from species of a particular genus of tree – Appellant Territory licensed third party ("ACOC") to enter Crown land and remove timber from trees of this species – Patents Act1990 (Cth), s 117(1) provided that, if "use of a product by a person" would infringe a patent, "supply" of that product by one person to another was an infringement by supplier – Respondents alleged Territory infringed patent by supply of timber to ACOC – Relationship between exclusive rights to exploit patent and s 117 – Meaning of "product" in s 117 where patent said to be infringed is for method or process – Whether "product" confined to product that itself results from use of a patented method or process.
Intellectual property – Patents – Infringement – Contributory infringement –Meaning of "supply" in s 117 – Whether grant of licences to sever and take timber from Crown land constituted "supply" of timber by Territory for purposes of s 117(1) – Relevance of classification of interest of ACOC as realty or personalty.
Intellectual property – Patents – Infringement – Contributory infringement –Section 117(2)(b) provided that "use of a product by a person" in s 117(1) meant "any use" if product was not a "staple commercial product" – Meaning of "staple commercial product" – Whether timber taken by ACOC under licences a "staple commercial product".
Words and phrases – "exploit", "method or process", "product", "staple commercial product", "supply", "use of a product by a person".
GUMMOW ACJ AND KIRBY J. To assist in appreciation of the issues which arise on this appeal from the Full Court of the Federal Court of Australia (Branson and Sundberg JJ; French J dissenting)[1] it is appropriate first to describe the structure and conduct of the litigation which gave rise to the appeal to the Full Court.
By their amended statement of claim in the Federal…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
Continue reading Northern Territory v Collins
Sign in free to access the full text
Details
AGLC
Northern Territory v Collins [2008] HCA 49
Case
[2008] HCA 49
Decision Date
CaseChat Overview and Summary
The High Court of Australia heard an appeal concerning allegations of patent infringement by the Northern Territory against Mr and Mrs Collins. The Collinses, registered proprietors of a patent for methods of producing essential oils from certain tree species, alleged that the Northern Territory infringed their patent by supplying timber from Callitris trees to Australian Cypress Oil Company Pty Ltd ("ACOC"). ACOC, licensed by the Northern Territory to take timber from Crown land, allegedly used this timber to produce an oil using the patented methods, which was then sold by ACOC.
The central legal issues before the High Court were whether the Northern Territory's grant of licences to ACOC to sever and take timber constituted "supply" of a "product" for the purposes of s 117(1) of the Patents Act 1990 (Cth), and whether the timber taken by ACOC qualified as a "staple commercial product" under s 117(2)(b) of the Act. The court was required to interpret the meaning of "product" in the context of a patent for a method or process, and the scope of "supply" in relation to the licences granted.
The High Court allowed the appeal, setting aside the decision of the Full Court of the Federal Court. The Court reasoned that the grant of licences permitting ACOC to sever and take timber constituted a "supply" of timber by the Northern Territory. However, the Court found that the Northern Territory was protected by s 117(2)(b) of the Patents Act, as the timber taken by ACOC was not a "staple commercial product" in the circumstances. This conclusion was sufficient to allow the appeal, and the Court did not need to consider other arguments raised by the Northern Territory.
Orders
Orders of the court
1. Appeal allowed with costs.
2. Set aside the order of the Full Court of the Federal Court of Australia made on 20 September 2007 and in its place order that the appeal to that Court be dismissed with costs. (Orders of the Court)
Background
Background to the litigation
This appeal from a decision of a Full Court of the Federal Court of Australia[31] (the "Full Court") concerns the allegation by Mr and Mrs Collins that the appellant, the Northern Territory of Australia (the "Northern Territory"), is liable under s 117[32] of the Patents Act 1990 (Cth) (the "Act") for infringement by supply of timber from trees of species of the genus Callitris to Australian Cypress Oil Company Pty Ltd ("ACOC"). It is alleged that ACOC, which was licensed by the Northern Territory to take timber from one of its plantations, used the bark and wood of the timber to produce infringing oil by use of one of the methods claimed in the patent. The allegedly infringing oil was also said to have been sold and offered for sale by ACOC.[31]Collins v Northern Territory (2007) 161 FCR 549.[32]Set out later in these reasons at [72].The facts Species of the genus Callitris include Callitris intratropica, commonly known as the cypress pine, which can be found in the wild and in plantations in the Northern Territory, including at the Howard Springs Plantation which is situated on Crown lands under the Crown Lands Act (NT) (the "Crown Lands Act"). The Northern Territory government invested in planting cypress pine at various sites within the Northern Territory during the 1960s in the expectation that it would be a commercial timber producing crop. The evidence disclosed that by November 1995 this expectation had been disappointed and the timber from the cypress pine plantations was no longer considered to be of suitable commercial quality for the original purposes for which the trees had been planted[33]. [33]Collins v Northern Territory (2006) 70 IPR 614 at 620 [30]. On 30 April 1993 Mr Collins was granted a permit from the Conservation Commission of the Northern Territory (then responsible for the administration of the Howard Springs Plantation) to undertake "Crop thinning of Callitris Intratropica" for a term of 12 months. That permit required the payment of a royalty of 20 cents per stem felled. There was a dispute (which is not relevant to the present appeal) as to whether Mr Collins had been issued with a second permit to fell the cypress pine for the period 18 October 1994 to 17 October 1999. At some point after 1993, the precise date of which is not clear, the Howard Springs Plantation ceased to be part of a reserve, and reverted to Crown lands within the meaning of the Crown Lands Act[34]. From 1998 until 2001 the government of the Northern Territory granted to ACOC four miscellaneous licences, pursuant to s 91 of the Crown Lands Act, to enter and take the stems of the cypress pine[35] from various areas within the Howard Springs Plantation. Those licences were subject to terms and conditions prescribed in the Crown Lands Regulations as provided by s 94(2) of the Crown Lands Act, and reg 46 provided that the Minister "may determine a royalty on the material removed from the land". [34]The definition of "Crown lands" in s 3 encompassed land formerly of the Commonwealth which became vested in the Northern Territory under s 69(2) of the Northern Territory (Self‑Government) Act 1978 (Cth).[35]An activity which was subject to penalty if conducted without a lease, licence or lawful authority, as to which see s 102 of the Crown Lands Act.
Whether there was a supply of timber is not to be answered by attempting to classify what was granted as an interest in realty or personalty[29]. Nor is it to be answered by asking whether there was a sale of a chattel[30] or by asking, as the appellant submitted, whether the conditions of the licence were enforceable only by forfeiture. Rather, it is to be observed that the licences permitted the licensee to sever and take the timber. That being so there was a supply of the timber. The appellant supplied the licensee with the timber by granting the licences it did.[29]cf (2007) 161 FCR 549 at 577 [80] per French J.[30]cf (2007) 161 FCR 549 at 577‑578 [81]‑[82].Conclusion and order For these reasons, I agree that the appeal should be allowed with costs and that consequential orders should be made in the form proposed by Crennan J. I agree with Crennan J's conclusion that the Northern Territory is protected by s 117(2)(b) of the Patents Act 1990 (Cth), and with the reasons she has given for that conclusion. That conclusion is a sufficient basis for allowing the appeal and for making the other orders she proposes. It is therefore not necessary to consider the other two bases which the Northern Territory urged in support of an order allowing its appeal. Since 21 January 1999 the respondents, Vincent and Maryann Collins, have been the registered proprietors of standard patent No 742711 for an invention entitled "Methods of producing essential oils from species of the genus callitris" ("the patent"). The essential oil relevant to the appeal is said to be useful in aroma therapy, and in the manufacture of cosmetics and body care products; it may also possess anti‑microbial properties and preservative qualities in the treatment of wood. It appears that an appealing feature of the oil is its azure colour. Claim 1 of the patent describes "[a] method of producing a blue, guaiazulene-containing oil comprising the step of obtaining the oil from a mixture of the bark and wood of Callitris intratropica". Claims 2 to 11 (inclusive) deal with method claims. Whilst the emphasis in the proceedings was on method claims, claim 12 was a product claim for "[a] blue, guaiazulene-containing oil when produced by a method according to any one of" the preceding claims. This appeal from a decision of a Full Court of the Federal Court of Australia[31] (the "Full Court") concerns the allegation by Mr and Mrs Collins that the appellant, the Northern Territory of Australia (the "Northern Territory"), is liable under s 117[32] of the Patents Act 1990 (Cth) (the "Act") for infringement by supply of timber from trees of species of the genus Callitris to Australian Cypress Oil Company Pty Ltd ("ACOC"). It is alleged that ACOC, which was licensed by the Northern Territory to take timber from one of its plantations, used the bark and wood of the timber to produce infringing oil by use of one of the methods claimed in the patent. The allegedly infringing oil was also said to have been sold and offered for sale by ACOC.[31]Collins v Northern Territory (2007) 161 FCR 549.[32]Set out later in these reasons at [72].The facts