Orthopedic Innovation Pty Ltd v CPL Holdings Pty Ltd
[2015] APO 71
•28 October 2015
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Orthopedic Innovation Pty Ltd v CPL Holdings Pty Ltd [2015] APO 71
Patent Application: 2011229160
Title:Drill bit
Patent Applicant: CPL Holdings Pty Ltd
Opponent: Orthopedic Innovation Pty Ltd
Delegate: Xavier Gisz
Decision Date: 28 October 2015
Hearing Date: 29 July 2015, in Sydney
Catchwords: PATENTS - opposition to the grant of a patent under section 59 – Applicant not entitled to grant of patent because the inventor had previously assigned rights to any ‘improvement’ of a previous application – opposition is successful
Representation: Patent applicant: Greg Gurr of Spruson and Ferguson
Opponent: Anthony Franklin of counsel assisted by Greg Whitehead of Shelston IP
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2011229160
Title:Drill bit
Patent Applicant: CPL Holdings Pty Ltd
Date of Decision: 28 October 2015
DECISION
The applicant, CPL Holdings Pty Ltd, is not entitled to the invention, and the application has been successfully opposed under s 59(a)(i). Subject to appeal I refuse the application.
Surgibit IP Holdings Pty Ltd may apply for a patent within 3 months of the date of this decision pursuant to s 33.
I award costs according to Schedule 8 against CPL Holdings Pty Ltd.
REASONS FOR DECISION
Background
Patent application 2011229160 is the national phase entry of PCT application PCT/AU2011/000317 (referred throughout the decision as ‘the application’ or ‘the present application’) in the name of CPL Holdings Pty Ltd (‘the Applicant’) which was filed on 18 March 2011. The application was advertised as accepted on 29 November 2012. The application lists Liam Ellis as the inventor.
A notice of opposition was filed by Orthopedic Innovation Pty Ltd (referred throughout this decision as ‘the Opponent’ or ‘OI’) on 28 February 2013. A statement of Grounds and Particulars was filed on 28 May 2013 with Entitlement under s 59(a)(i) being the only ground of opposition. Evidence in support was completed on 28 August 2013. Evidence in answer was not filed.
On 27 March 2014 the Applicant requested that the Opposition be stayed until the Federal Court proceedings had been finalised (NSD 226/2014) which concerned issues closely related to those before the Commissioner. On 11 April 2014, a direction to stay the opposition was made. On 15 December 2014 the parties advised that the Federal Court proceedings had been discontinued.
A hearing was held on 29 July 2015 at Shelston IP in Sydney.
Onus of Proof
The examination request for this patent application was filed prior to 15 April 2013. As a consequence, substantive amendments of the Patents Act brought about by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 do not apply to the present application. This includes the amendment to subsection 60 (3A) that allows the Commissioner to refuse a patent application if satisfied on the balance of probabilities that a ground of opposition exists.
It is well established under the previous legislation that in proceedings such as these before the Commissioner, the onus rests with the opponent to clearly establish its case in reaching a conclusion on any issue. In F. Hoffman-La Roche AG v New England Biolabs Inc [2000] FCA 283, Emmett J of the Federal Court found that in opposition proceedings, the Court (and by implication the Commissioner of Patents in her role as a tribunal) should be "clearly satisfied that the patent, if granted, would not be valid". Where questions of fact such as obviousness and existence of invention are involved "the grant should not be refused unless it has been clearly shown that the grounds of opposition have been clearly made out" (Montecatini v Eastman Kodak (1971) 45 ALJR 593).
The specification
The application relates to a drill bit that is particularly suited to drilling bone. The invention relates to the shape of the drill bit and in particular the lands (i.e. the area between the flutes) which are chamfered to allow more efficient removal of swarf (debris) from the hole being drilled.
Evidence
The evidence comprises:
- A declaration of Scott Wilson with exhibits SW-1 to SW-10
- A declaration of William Walsh with exhibits WW-1 to WW-4.
Outline of opposition
Liam Ellis, the inventor of the present application, signed a Deed of Assignment (the Deed) on 22 July 2004 which assigned all Technology and intellectual property rights to Surgibit IP Holdings Pty Limited. The definition of Technology is given in Attachment A of the Deed and is reproduced below:
“Technology means the drill bit design and method of manufacture of drill bits for use in a variety of applications including for use as a surgical cutting tool which is the subject of Patent Application Number PCT/AU03/01003 and includes all Improvements thereof.”
I have referred to PCT/AU03/01003 (which is also referred to by its more correct application number format PCT/AU2003/001003) as ‘the PCT application’ throughout this decision.
The definition of Improvements is also given in Attachment A of the Deed and is reproduced below:
“Improvements means in relation to any given technology, any adaptations, derivations, enhancements, improvements or developments based on, or derived from, such technology.”
The Opponent argued that by this Deed, Surgibit was entitled to the currently opposed application.
Relationship between Surgibit and OI
The relationship between the Opponent and Surgibit is explained in Mr Wilson’s declaration:
“It was agreed that an intellectual property holding company would be formed and that Ellis would assign all intellectual property in the Surgibit design, including the Surgibit PCT Application, to that company. The IP holding company would license such intellectual property to OI to allow it to market and sell the Surgibit product. That holding company was to be Surgibit. It was agreed that Ellis and myself would be directors of Surgibit.”
Thus it is clear that Surgibit and OI are closely related though they are different entities.
Summary of issues
The Applicant’s provided the following summary of issues in their submissions:
“The key issues arising in the present opposition are as follows:
a) is the Assignment Deed valid?
b) if the Assignment Deed is found to be valid, is it effective in assigning Improvements (as defined in the Assignment Deed) to Surgibit, in light of a later executed Deed of Settlement and Release (“Release Deed”), executed on 2 March 2007?
c) does the Release Deed act as a bar to the present opposition proceedings?
d) what constitutes “the subject of” the Surgibit PCT Application set out in the definition of Technology in the Assignment Deed?
e) does the invention defined in each of claims 1 to 18 of the Opposed Application constitute the subject of the Surgibit PCT Application and thus Technology as defined in the Assignment Deed?;
f) does the invention defined in each of claims 1 to 18 of the Opposed Application constitute an Improvement as defined in the Assignment Deed.”
This decision follows the structure of these questions posed by the Applicant.
a) Validity of the Deed
The Applicant argued that the Deed is not valid because it was not ratified as required by the Corporations Act. The Applicant states in their submissions:
“The evidence indicates that the Deed was executed on 22 July 2004, prior to the incorporation of Surgibit, which occurred on 26 July 2004, as acknowledged by the Opponent. Section 131(1) of the Corporations Act provides that a company may become bound by, and entitled to the benefit of, a contract entered into by a person on behalf of, or for the benefit of, the company before it is registered, but only if the company ratifies the contract:
(a) within the time agreed to by the parties to the contract; or
(b) if there is no agreed time – within a reasonable time after the contract is entered into.There is no evidence that the parties to the Assignment Deed agreed a time by which the Assignment Deed was to be ratified, such that section 131(1)(a) does not apply. Accordingly, Surgibit will only potentially be bound by, and entitled to, the benefit of the Assignment Deed if it is established that Surgibit ratified the Assignment Deed “within a reasonable time” after the Assignment Deed was entered into, being within a reasonable time after 22 July 2004.”
The Opponent states in their submissions:
“It is clear that the Deed was executed by Ellis and purportedly by Surgibit with both parties under the impression that Surgibit was in existence and was able to execute the Deed. Accordingly there was no time agreed in the document for ratification by Surgibit. It follows that for Surgibit to have the benefit of the Deed it must have ratified the Deed within a reasonable time after it being entered into.
There are no formalities prescribed for ratification and it is clear from the case law that ratification can be express or implied.”
“In Rafferty v Madgwicks [2012] FCAFC 37, a company was held to have impliedly ratified a pre-registration contract when it did certain things referred to in that contract. Although the court indicated that the matter was not entirely free of doubt, the court considered at [143] that this conclusion was justified by the fact that two parties to the pre-registration contract were, together, the "guiding mind of the company" on its incorporation.”
Subsection 131(1) of the Corporations Act states:
Contracts before registration
(1) If a person enters into, or purports to enter into, a contract on behalf of, or for the benefit of, a company before it is registered, the company becomes bound by the contract and entitled to its benefit if the company, or a company that is reasonably identifiable with it, is registered and ratifies the contract:
(a) within the time agreed to by the parties to the contract; or
(b) if there is no agreed time--within a reasonable time after the contract is entered into.
I am satisfied that s 131(1) of the Corporations Act applies in the present circumstances. The Rafferty v Madgwicks [2012] FCAFC 37 decision relates to the operation of s 131 of the Corporations Act and is clearly highly relevant to the present circumstances. Consistent with Rafferty v Madgwicks I consider that implied ratification will have occurred if the “guiding minds” of the company acted as if the Deed were valid and in force.
Was there implied ratification of the Deed?
Mr Wilson states in his declaration:
“It was agreed that an intellectual property holding company would be formed and that Ellis would assign all intellectual property in the Surgibit design, including the Surgibit PCT Application, to that company. The IP holding company would license such intellectual property to OI to allow it to market and sell the Surgibit product. That holding company was to be Surgibit. It was agreed that Ellis and myself would be directors of Surgibit.”
The purpose of the creation of Surgibit was as an intellectual holding company. There is no evidence that any intellectual property was assigned to Surgibit either before or after its inception other than the PCT application (and any improvements on that PCT application). Mr Ellis and Mr Wilson were both the parties in the Deed and the directors of Surgibit. Therefore there is a strong inference that the act of creating Surgibit (which was solely for the purpose of exploiting the invention in the PCT application) was itself an implied ratification of the Deed.
Mr Wilson states:
“On or around 30 September 2005, Surgibit lodged with the Australian Registrar of Patents a request for change of ownership from Ellis to Surgibit of Australian Patent Number AU2003250578, the Australian patent resulting from the Surgibit PCT Application, and a request for registration of the Deed of Assignment. The change of ownership from Ellis to Surgibit was recorded on 15 November 2005. Now shown to me and marked Exhibit SW-4 is an extract from the online IP Australia database showing the recordal of the change of ownership. Now shown to me and marked Exhibit SW-5 is an extract from the ASIC companies database showing that at the time of the acts referred to in this paragraph 13.2, Ellis and myself were the only directors of Surgibit, and acted therefore as its 'guiding mind'.”
Making a request for the application to proceed in the name of Surgibit is consistent with the Deed being valid and in force (and thus impliedly ratified).
Mr Wilson states in his declaration:
“In 2005, relations broke down between myself and the other directors and shareholders of OI on the one hand, and Ellis on the other. Ellis' employment with OI was terminated as of 31 March 2005. Ellis ceased to be a director of OI in June 2005 and ceased being a shareholder of OI in February 2006.”
“In March 2007, settlement of those legal proceedings and all issues between the parties was achieved and recorded in the Deed of Settlement and Release annexed at Exhibit SW‑6. Pursuant to such settlement, Ellis received a cash payment and transferred his shareholding in, and resigned as a director of, Surgibit and ended his involvement with Surgibit and OI.”
Mr Ellis was still a director of Surgibit at the time the request for application AU 2003250578 to proceed in the name of Surgibit was made. The break-down of relations between Mr Ellis and the other directors and shareholders of OI is not directly relevant in the determining if there was implied ratification of the Deed.
All the evidence supports the proposition that there was an implied ratification of the Deed and thus, in the absence of contrary evidence, I am satisfied that there was ratification of the Deed under s 131(1) of the Corporations Act.
b) Deed of settlement and release (Release Deed)
The Applicant states in their submissions:
“…[C]lause 11 of the Release Deed releases Mr Ellis from any obligation to assign future Improvements, as defined in the Assignment Deed, to Surgibit. The Assignment Deed thus cannot operate to assign any rights in the invention claimed in the Opposed Application from Mr Ellis to Surgibit. This is consistent with the clear intent of the Release Deed for the opposing parties to walk away from any ongoing relationship or obligations apart from the specific obligations set out in the Release Deed.”
The Release Deed releases Mr Ellis from future association with Surgibit and for actions previously performed by Mr Ellis that is not covered by the existing Deed. The Release Deed does not affect the pre-existing assignment of drill bit technology (both existing and improvements) from Mr Ellis to Surgibit that was made in the Deed of Assignment.
c) Does the Release Deed act as a bar to the present opposition proceedings?
Clause 11 of the Release Deed provides:
Save in respect of enforcement of this Deed, each of:
(a) Orthopedic Innovation;
(b) Surgibit IP Holdings;
(c) Scott Wilson;
(d) John·Wilson; and
(e) Mark O'Brien,
hereby Irrevocably releases and forever discharges and indemnifies Liam Ellis from and against any and all claims, demands, actions, causes suits, proceedings, debts or liability whatsoever that any one or more of the persons referred to at subclauses (a), (b), (c), (d) and (e) of this clause now has, or but for execution of this Deed may have, against the said Liam Ellis, arising, whether dlrectiy or indirectly:
(f) under or in connection- with local court proceedings number 3346 of 2006;
(g) in respect of any and all matters the subject of the said local court proceedings;
(h) by reason of:-
(i) any matter or thing arising or occurring; and
(ii) any act (including a failure to act) or omission of Liam Ellis,
while·Liam Ellis was a promoter, shareholder, director, officer, employee or agent of either or both of Orthopedic Innovation and Surgibit IP. Holdings,
and this clause 11 may be pleaded as a bar to proceedings.
The Applicant states in their submissions:
“The claim by the Opponent that Surgibit has gained entitlement from Mr Ellis to grant of a patent for the invention claimed in the Opposed Application, by virtue of the provisions of the Assignment Deed, is clearly a “claim, demand, action, cause, suit, proceeding, debt or liability” against Mr Ellis that directly or indirectly arises from Mr Ellis’ execution of the Assignment Deed. Accordingly, clause 11 of the Release Deed releases Mr Ellis from any obligation to assign future Improvements, as defined in the Assignment Deed, to Surgibit. The Assignment Deed thus cannot operate to assign any rights in the invention claimed in the Opposed Application from Mr Ellis to Surgibit.”
I have already found above that the Release Deed releases Mr Ellis from future action and for actions previously performed by Mr Ellis not covered by the existing Deed. It follows that the ‘bar to proceedings’ clause is only intended to rule-out legal proceedings between listed parties on actions not covered by the existing Deed. Thus the ‘bar to proceedings’ is not relevant to the present consideration.
d) Technology/Subject of the PCT application
The PCT application addresses the following problem:
“The use of drill bits for orthopaedic surgery is known. However, a problem can occur with existing orthopeadic drill bits when drilling through bone and cartilage. Specifically, bone has a covering known as periosteum which has a slippery characteristic. When drilling, particularly in difficult surgical procedures, it has been known for drill bits to slip off the periosteum, potentially causing damage to the periosteum and bone, and to adjacent body parts including muscles, tendons, skin, organs etc.”
The PCT application is directed to a drill bit. The characterising features are the geometry of the tip and the channels that lead from the tip to the flutes.
The geometry of the tip has flat faces (pyramidal shaped). This is in contrast to typical drill bits that have a conical tip. The tip has channels, which feed into the flutes in the shaft of the drill bit. This is in contrast to typical drill bits that only have channels (flutes) in the shaft of the drill bit.
Similarity/Difference between the PCT application and the present application
Differences
The opponent argued that the PCT application disclosed the features of chamfered and smoothed regions between the lands and flutes as described in the present application. The opponent in particular pointed to page 13 line 30 to page 14 line 6:
“Referring now to Figure 6, where like reference numerals are used to denote similar or like parts, a surgical drill bit having three faces at drilling end 618, similar to the drill bit of Figures 3 and 4, is shown. Each face also has a respective flute intersecting therewith, however, in this embodiment the intersection between the flute and its respective face is not abrupt but is gradual as facilitated by a continuous curved region 626. This region provides a kind of scalloping or concavity in each face 620, thus enhancing the definition of the drill point 619, but also providing a more pronounced channelling affect into each flute to guide and enhance the removal of debris cut by the rotating drill bit.”
The opponent argued that the words “the intersection between the flute and its respective face is not abrupt but is gradual as facilitated by a continuous curved region 626” described a chamfer and smoothing of the region between the land and the side of the flute. This point was made at paragraph 36 of Mr Walsh’s declaration.
I disagree with the opponent’s interpretation. Instead I consider this to be describing a smooth transition between the end of the flute and the face of the tip. The faces of the tip of the present application are curved (see figures 3b to 3d), whereas the faces of the tip of the PCT application are flat. In short, the PCT application does not disclose a chamfered and smoothed region between the lands and the flutes as described in the present application.
Other differences include: a) The present application has three flutes, whereas the PCT application has two, and b) the present application has curved tip faces whereas the PCT application has flat tip faces.
Similarities
Both applications have grooves in the tip region that flow into the flutes; a point made by Mr Walsh at paragraph 38 of his declaration.
This is seen in PCT/AU2003/001003 in figure 10c (with item numbers removed for clarity) which shows a v-shaped groove in the tip region joining with the flute of the drill bit.
Figure 10cThis can be seen in the present application in cross-section in figure 3e (with item numbers removed for clarity) where each groove (gulley) in the tip region joins the flute of the drill bit. The cross section is taken in the tip region represented by the hatching, with the remainder of the drill bit represented in the unhatched areas.
Figure 3ee) Is the present application directed to the ‘subject’ of the PCT application?
For a drill bit to be considered ‘subject’ of the PCT application it must essentially be the same as one of the disclosed embodiments. Although there is similarity between the present application and embodiments in the PCT application there are also several differences and thus they cannot be considered the same. Consequently I do not consider the present application to be ‘subject’ of the PCT application.
f) Is the present application an Improvement of the PCT application?
I now consider the question of whether the present application can be considered as an improvement of the PCT application, as defined in the Deed.
Review of case law
The Applicant and Opponent made submissions about three prior decisions that related to the use of the word ‘improvement’ in contracts. These prior decisions are briefly considered below.
Fermiscan Pty Ltd and others v James [2009] NSWCA 355
In the Fermiscan case Dr James had invented a method for detecting certain cancers by exposing hair to x-ray diffraction and detecting changes in the ultrastructure of the hair. In 2004 she assigned the invention and patents for the invention to the Fermiscan parties, including “improvements”. Subsequently, Dr James discovered that x-ray diffraction could also be applied to human nail and skin to detect certain cancers. She filed a PCT application in respect of this second invention. Fermiscan commenced proceedings in the NSW Supreme Court claiming the second invention was an “improvement” to the first invention assigned to it and, pursuant to the assignment, the second invention belonged to Fermiscan.
In that case the word improvement was defined in the assignment agreement as:
“"Improvement" means any invention, discovery, modification, adaptation or improvement, whether patentable or not, which can be used to reduce manufacturing or assembly costs of the products of the exercise of the Invention or improve the performance of any product or process, increase the service or shelf life of any such product, broaden the applicability of any process employed in or toward the Invention or range of uses of any product thereof or create a wholly new product or component or process which replaces or is an enhancement of the subject matter of the Invention, devised by or for the Assignor and/or the Inventor, or vested in the Assignor and/or the Inventor, and whether or not the use of which by any person other than the Assignor and/or the Inventor or the Assignee would infringe any Registered Right, and shall mean and include all and any Registered Rights in respect thereof.”
Justice Allsop found that:
“The subject matter of the Invention, was its claimed scope, part of which was the use of hair. The second invention does not enhance or replace those claims, because those claims (as a whole and as a combination patent) are not part of the second invention. The second invention does not replace the first.”
Consequently the Court of Appeal held that the invention in the subsequent PCT application by Dr James was not an “improvement” and was not part of the property assigned to Fermiscan.
NewSouth Innovations Pty Ltd v Dr. Wieslaw Kaczmarek [2010] APO 2 (5 February 2010)
In the Kazmarek case it was observed at paragraph 26:
“It remains to determine whether the invention is an Improvement over the inventions described in provisional application 2004907192. As indicated above the commercialisation agreement defines this as “improvements to, and developments, adaptations and enhancements of, the Inventions (patentable or otherwise)”. From this it is evident that the notion of an improvement covered by the agreement is to be understood broadly. It is also apparent that the terms of the definition should be understood in a commercial rather than technical sense given the purpose of the agreement appears to be to ensure that the commercial value of the existing and follow on research and innovation was captured. In this regard I note Lord Hoffman’s reasons in Buchanan v Alba Diagnostics Limited [2004] UKHL 5.”
The Deputy Commissioner of Patents found that the invention was an improvement and thus NewSouth Innovations Pty Ltd was entitled to the invention.
Buchanan v Alba Diagnostics Limited [2004] UKHL 5, 5 February 2004, House of Lords
In this case Lord Hoffman stated:
"Improvement" is not a term of art and can have wider or narrower meanings according to context. The context in this case was a provision intended to preserve the commercial value of the rights forming the principal security, namely the application for the 311 patent. I agree with the Lord Ordinary and the Inner House that in this context the word should be given a broad and commercial rather than a narrow and technical meaning. The words of Lord Loreburn LC in Linotype and Machinery Ltd v Hopkins (1910) 27 RPC 109, 113 seem to me to convey the right flavour. He said that, in the context of a licensing agreement, a part for a machine was an improvement —
"if it can be adapted to this machine and it would make it cheaper and more effective or in any way easier or more useful or valuable or in any other way make it a preferable article in commerce."
The House of Lords found that the invention of the later patent was an improvement of the original patent.
The principle found in these decisions is the same for contracts more generally – that the meaning must take into account the context in which the provision was intended to preserve.
Meaning of the word Improvement in the Deed
“Improvement” is defined in the Assignment Deed in the following terms:
“Improvements means in relation to any given technology, any adaptations, derivations, enhancements, improvements or developments based on, or derived from, such technology.”
“Technology means the drill bit design and method of manufacture of drill bits for use in a variety of applications including for use as a surgical cutting tool which is the subject of Patent Application Number PCT/AU03/01003 and includes all improvements thereof.”
Thus the term ‘improvement’ is limited to variations based on or derived from PCT application PCT/AU03/01003.
The intent of the parties when the deed was signed
The intent of the parties in including the ‘improvements’ in the Deed was to preserve commercial value; without this clause, the potential existed for Mr Ellis to commercialise a similar competing product which would undermine the value of Surgibit. This understanding of the word ‘improvement’ is consistent with the approach taken in the three aforementioned decisions (Fermiscan, NewSouth Innovations, and Buchanan)
Is the application ‘based on or derived from’ the PCT application (PCT/AU03/01003)?
The Applicant notes in their submissions:
“Neither the claims nor description of the Surgibit PCT Application is at all concerned with a build up of pressure in the flutes, or with passing swarf from a land relief (which is not provided in the drill bits of the Surgibit PCT Application) to the adjacent flute.”
This would be an appropriate approach to the question of whether the present application has an inventive step over the PCT application PCT/AU03/01003. However, the determination of inventive step is not directly related to the determination of an improvement. Instead, the question is whether the present application is based on or derived from the PCT application.
In my opinion, a purposive construction of the words ‘based on or derived from’ requires that there must be a non-generic commonality between the inventions. Although the threshold could be chosen to be higher than merely ‘non-generic commonality’ such as having ‘unique commonality’, the guidance provided in case law for construing the term ‘improvement’ in a commercial document such as the Deed endorses a broad commercial rather than narrow technical approach; thus the lower threshold of ‘non-generic commonality’ is appropriate in this case. Furthermore the non-generic commonality must be functionally important to the inventions.
The generic commonality between the two applications include that both relate to drill bits having a tip, a shaft, and helical flutes extending along an exterior length of the shaft. These generic similarities do not provide a basis that the present application is ‘based on or derived from’ the PCT application.
Both applications share the concept of grooves in the tip that flow into the flutes, which is functionally important because it improves the swarf (debris) removal. This is unlike typical drill bits wherein the flutes simply terminate at the face of the tip region of the drill bit; a point made at page 10 lines 12 to 16 of the present application:
“The gulleys 27 each provide a flow path for swarf from adjacent the drill tip 3 for feeding the swarf into the flutes 5. This may be contrasted with typical prior art drill bits, where the solid end portion of the cutting end part is substantially pyramid shaped without provision of any flow path for the passage of swarf.”
Thus the applicant has acknowledged that the concept of grooves in the tip that flow into the flutes to be both a functionally important and non-generic feature. Consequently, I find that the present application is ‘based on or derived from’ the PCT application.
Is the application an improvement on the PCT application (PCT/AU03/01003)?
The word Improvement is defined in the Deed as follows:
“Improvements means in relation to any given technology, any adaptations, derivations, enhancements, improvements or developments based on, or derived from, such technology.”
I consider that the words ‘any adaptations, derivations, enhancements, improvements’ cover almost any variation or difference. I note that a sufficiently radical departure from the original invention may go beyond being an improvement and instead be considered an entirely different invention.
The present application is different from the PCT application as discussed earlier in this decision. However, these differences are not enough to put the invention beyond an ‘improvement’. The common feature, grooves in the tip that flow into the flutes, is significant to both inventions and is not offset by the aforementioned differences such that it could be considered an entirely different invention.
I further note that the present invention is sufficiently similar to the invention of the PCT application such that it could be in direct commercial competition; a situation I have found was intended to be prevented by the ‘improvement’ clause in the Deed. Consequently I consider the current application an improvement to the PCT application.
Consequences of lack of entitlement
Section 33(1) provides that:
(1) If:
(a) an application has been made for a standard patent; and
(b) the grant of the standard patent is opposed under section 59 by one or more persons; and
(c) the Commissioner decides, under section 60, that:
(i) one or more opponents are eligible persons in relation to the invention, so far as claimed in any claim of the opposed patent application (the original claim); and
(ii) the nominated person in respect of the application is not an eligible person in relation to the invention; and
(iii) there is no other reason that a patent should not be granted; and
(d) a complete application is made under section 29 by one or more of the eligible persons for a patent in relation to the invention;
the Commissioner may grant those eligible persons a patent jointly for the invention, so far as so claimed.
Conclusion
I have found that the Deed which assigns the PCT application (PCT/AU2003/001003) (and improvements thereon) to Surgibit is valid. I have found that the invention disclosed in the present application is an improvement of the PCT application, and thus is subject to the Deed. Therefore the Applicant, CPL Holdings Pty Ltd, is not entitled to the invention, and the grant of patent has been successfully opposed under s 59(a)(i). Subject to appeal I refuse the application.
Pursuant to s 33 Surgibit IP Holdings Pty Ltd may apply for a patent (complying with s 29) within 3 months of the date of this decision (reg 3.8(a)).
Costs
Costs typically follow the event. The Opponent has successfully opposed the grant of the patent. Costs are awarded in accordance with Schedule 8 against the Applicant, CPL Holdings Pty Ltd.
Xavier Gisz
Delegate of the Commissioner of Patents
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