Osmose, Inc. v Arch Wood Protection Pty Ltd
[2010] APO 15
•25 August 2010
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Osmose, Inc. v Arch Wood Protection Pty Ltd [2010] APO 15
Patent Applications 2004230950
Title:Micronized Wood Preservative Formulations
Patent Applicant: Osmose, Inc.
Opponent: Arch Wood Protection Pty Ltd
Delegate: Dr S. K. Aggarwal
Decision Date: 25 August 2010
Submission Filed: 26 July 2010, in Canberra
Catchwords: PATENTS – request under subregulation 5.10(2) – request for extension of time to serve evidence in support – no satisfactory explanation of delay – lack of diligence by the opponent – interests of parties offsetting – public interest in determining opposition on its merits marginally outweighs other considerations
Representation: Patent applicant: Watermark, Melbourne.
Opponent:Shelston IP, Sydney
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2004230950
Title:Micronized Wood Preservative Formulations
Patent Applicant: Osmose, Inc.
Date of Decision: 25 August 2010
DECISION
I grant the extension of time to serve evidence in support in respect of the patent application until 18 September 2010.
I make no award of costs.
REASONS FOR DECISION
Background
Patent application 2004230950 directed to Micronized Wood Preservative Formulations was filed on 9 April 2004 by Osmose, Inc. (hereinafter referred to “Osmose”). The patent application proceeded to acceptance and was advertised accepted on 18 June 2009.
Arch Wood Protection Pty Ltd (hereinafter referred to “Arch Wood”) filed a notice of opposition to the patent application 2004230950 on 18 September 2009. A statement of grounds and particulars was served on 18 December 2009. The service of evidence in support was due on 18 March 2010.
Further to the Commissioner’s direction of 11 February 2010, Arch Wood filed an amended statement of grounds and particulars on 9 March 2010, which was allowed on 1 April 2010.
On 18 March 2010, Arch Wood filed an application for extension of time to serve evidence in support from 18 March 2010 to 18 June 2010 which was granted on 9 April 2010.
On 18 June 2010, Arch Wood filed a part evidence in support comprising a first statutory declaration by Dr Gareth Dixon. Accompanying the declaration was a further application for extension of time to serve remaining evidence in support from 18 June 2010 to 18 September 2010 which was opposed by Osmose.
On 12 July 2010, the Patent Office advised the parties that the matter could be dealt with by a hearing on the written record. Consequently, the parties were invited to file written submission in relation to the above matter by 26 July 2010.
Osmose and Arch Wood filed their written submissions on 26 July 2010 via their patent attorneys Watermark, Melbourne and Shelston IP, Sydney respectively.
Application for Extension of Time
The circumstances in which, and the grounds upon which, the application for extension of time is made are stated to be as follows:
“The opponent has made further progress toward obtaining an appropriate statutory declaration from an independent expert as to the patentability of the opposed application. However, further difficulties and the associated time delays have been encountered in having this expert complete reviewing and assimilating the prior art which will form the basis of the opponent’s evidence-in-support.
Copies of the relevant materials have been forwarded to the expert for his consideration. However, the Commissioner will appreciate that he has conflicting business and personal commitments and that accordingly, the expert has not been able to complete his task over the current period.
We nonetheless have received further preliminary comments from this expert. Unfortunately, these comments were not sufficiently thorough as to justify inclusion within a statutory declaration providing partial or complete evidence-in-support; further commentary has been requested from this expert and is expected within the sought extension period.
Accordingly, we respectfully submit that the preparation of evidence based upon the need to assimilate the body of evidence, and have the expert consider the same is a significant undertaking which, despite our best intentions and diligent pursuit, has not been possible to complete during the present window. Further time is respectfully sought.
We submit that the public interest is well served in allowing this request for an extension of time. This is an important opposition matter and is in the public interest to have the matter heard on its merits, rather than expedited at the expense of the public interest.
Under the present circumstances, further time is respectfully requested so as to allow the expert sufficient time to consider, in sufficient detail, the opposed application in relation to the prior art base, and to prepare an appropriate statutory declaration outlining his expert opinion. We believe that a three month extension is warranted on the basis that the expert assisting us requires further time in which to formulate his opinions as to the patentability, or otherwise, of the opposed application.
We undertake to pursue the preparation of the evidence diligently over the next three months with a view to assisting with the preparation of the expert’s statutory declaration.
With reference to the Statutory Declaration served upon the applicant on 18 June 2010 as partial evidence-in-support, the Commissioner will appreciate that there is a very real issue at stake in this opposition. Said partial evidence concentrates on perceived “internal” deficiencies in the specification and claims of the opposed application. Indeed, it is at least partially due to these deficiencies that the expert assisting us with this opposition has not been able to complete his evidentiary task within the present period. The vague and ambiguous terminology used throughout the claims of the opposed application has resulted in the expert at times being uncertain as to how to interpret various terms – and at other times, spending unnecessary time attempting to decipher all “angles” of such terminology. The issues at stake here are very real – and further time is respectfully sought so as to complete the evidentiary task required of this expert.”
I will discuss the written submission of the parties as necessary in the reasons for my decision.
Law relating to extension of time
The time for serving evidence in support can be extended under subregulation 5.10(2) of the Patents Regulation 1991 which provides that:
(2)The Commissioner may extend the time within which the party may take a step prescribed in this Chapter (not being a step that is taken under regulation 5.3 or 5.3AA, paragraph 5.4(a), subparagraph 5.8(1)(a)(i) or regulation 5.9A):
(a) on the application of a party in the approved form; and
(b)on such reasonable terms (if any) as the Commissioner specifies; and
(b)after the party has served a copy of the application on the other party.
The above provision must be read in conjunction with subregulation 5.10(5) which provides that:
(5)The Commissioner must not give a direction under subregulation (1) or grant an application under subregulation (2) or (4) unless the Commissioner:
(a)if he or she proposes to grant an application by a party - is reasonably satisfied that the other party has been notified of the application; and
(b)if he or she proposes to act on his or her own motion - ensures that the parties are notified of the proposed action; and
(c)in either case:
(i)gives the parties a reasonable opportunity to make representations concerning the application or proposed action; and
(ii)is reasonably satisfied that a direction, an extension of time or the serving of evidence is appropriate in all the circumstances.
Consequently, it is a prerequisite to any decision that the Commissioner must ensure that the other party has been notified, and that both parties have had the opportunity to make representations. In the present case the other party has been notified, and both parties have been given the opportunity to make representations.
An extension can only be granted if the Commissioner is reasonably satisfied that it is appropriate. In exercising this discretion, I am guided by the decisions of Burchett J in Ferocem Pty Ltd v Commissioner of Patents (1994) AIPC 91-057; 28 IPR 243, Sackville J in A Goninan & Co Ltd v Commissioner of Patents (1997) AIPC 91-330; 38 IPR 213 and Goldberg J in National Starch & Chemical Co v Commissioner of Patents (2001) AIPC 91-697, 50 IPR 398. These decisions establish that:
(a)The power is discretionary: Regulation 5.10 confers a broad discretion, which cannot be reduced to imperative compliance with particular requirements. It is necessary to give genuine and proper consideration to all relevant considerations. (Ferocem at AIPC 38,208; IPR 247-8, Goninan at AIPC 39,434; IPR 220)
(b)Explanation of delay: The reasons why the evidence was not served earlier are a relevant consideration, but a satisfactory explanation is not a mandatory requirement. (Ferocem at AIPC 38,207-8; IPR 247)
(c)The public interest: The public interest in determining a serious opposition on its merits is a relevant consideration. (Goninan at AIPC 39, 435-6; IPR 222)
*In order to do this, it is necessary for the Commissioner to form a view as to the nature of the evidence that it is sought to adduce, and the significance of that evidence for the opposition proceedings. (Goninan at AIPC 39,438; IPR 225-6)
*The significance of the evidence is assessed having regard to any relevant material available, not just the evidence itself. (National Starch at [33])
*The public interest is not protected merely because some evidence has already been served. (Goninan at AIPC 39,438; IPR 225)
(d)The interests of the party seeking the exercise of discretion: The interests of the party seeking the exercise of discretion are a relevant consideration. (Ferocem at AIPC 38,208; IPR 247)
(e)The interests of other parties: It is relevant to consider the disadvantage to the other party of delays in determining the opposition, and the effect of delays on the efficient and orderly administration of the Patent Office. (Ferocem at AIPC 38,208; IPR 247, Goninan at AIPC 39, 436; IPR 222).
Explanation of the delay
Arch Wood cited several reasons for the delay in completing their evidence in support. They submitted that the expert presently assisting them, being a busy person involved in business, academia and consulting, was unable to dedicate a significant portion of time required to resolve the matter. Furthermore, a lot of work is required as sixteen prior art documents have been raised and each of the documents requires the expert’s consideration for both novelty and inventive step in respect of a relative large number of claims – including eight independent claims comprising scarcely related features. Arch Wood also indicated that vague and ambiguous terminology used throughout the claims of the patent application has resulted in the expert at times being uncertain as to how to interpret various terms – and at other times, spending unnecessary time attempting to decipher all “angles” of such terminology. It was submitted that, nevertheless, preliminary comments have been provided by the expert and the iterative process of preparing a statutory declaration is already well advanced. Arch Wood indicated that they have a legitimate interest in opposing the grant of a patent on the application and have no interest in unnecessarily prolonging the opposition proceedings.
Osmose criticized Arch Wood’s application for extension of time stating that it is too short in detail to determine what the expert has done over the past six months and that it would be expected that comments by the expert would have been beyond the “preliminary” stage as described in the application for extension of time. They submitted that Arch Wood have done little since the statement of grounds and particulars was filed to demonstrate progress and a legitimate effort to prepare its evidence in support of its opposition. Osmose put the view that the analysis of the specification does not justify a further extension; given that the expert has had six months to work on his evidence to date. It was also argued that even though Arch Wood filed the Dixon declaration concurrently with the application for extension of time, this did not dispel the notion that Arch Wood have not demonstrated that there is a serious opposition in train because the Dixon declaration contains legal submissions more appropriate for a substantive hearing of this matter.
I note that Arch Wood have had six months for preparing their evidence in support. I also appreciate that the preparation of evidence in support can be time consuming especially when the specification is complex. However, in the absence of any specific details from Arch Wood except for the expert’s competing commitments and the substantial volume of prior art he needs to consider, I cannot conclude that the time taken so far by Arch Wood in preparing their evidence in support is reasonable and that they have been diligent. I consider that Arch Wood have failed to provide a satisfactory explanation of the delay. However, it is noteworthy here that while a satisfactory explanation of delay is a relevant consideration, it is not a mandatory requirement for granting an extension of time.
The public interest
The public interest in opposition proceedings calls for a balance between said opposition being dealt with on its merits and expeditious processing. In order to determine the extent to which a correct and just determination of the opposition on its merits can be made, I need to assess the nature and the significance of the evidence that will be served.
Arch Wood submitted that the grounds of novelty and inventive step will play a significant role in the opposition proceedings, and that each of the prior art documents require the expert’s consideration in terms of both novelty and inventive step of the application to prepare an appropriate statutory declaration outlining his expert opinion. It was also submitted that in the overall course of a patent opposition, the extension sought is for a very small period of time and that the public interest will be well served by allowing the extension.
Osmose did not comment on the nature and significance of the evidence in support to be served, but instead put the view that the public interest that oppositions be conducted in an efficient and expeditious manner dictates against a further extension of time.
Arch Wood have already filed a part of its evidence in support comprising of a statutory declaration by an expert on 18 June 2010. Following a brief review of the declaration, I note that it does not include comments on grounds of novelty and inventive step. From the submissions on file, I can see that Arch Wood intends to address these grounds of opposition through a statutory declaration by the expert currently assisting them. Therefore, in my opinion the evidence to be served is significant in that without it there will be no serious challenge to the patent application. Although a considerable period has passed since the filing of statement of grounds and particulars by Arch Wood, in my view the public interest in the present case that an opposition be determined on its merits overrides the consideration that the opposition be swift. Therefore, I conclude that the public interest favours extension of time.
The interests of the party seeking the exercise of discretion
Arch Wood have an interest in submitting the declaration of their expert in support of the opposition, particularly since it relates to novelty and inventive step matters. At this juncture, Arch Wood have already filed part evidence in support concerning matters other than novelty and inventive step, and their case will be clearly prejudiced if I were to refuse the extension and thus preclude them from serving evidence from their other expert witness. I conclude that Arch Wood’s interests lie in obtaining the extension of time.
The interests of the party opposing the exercise of discretion
Osmose submitted that the grant of patent on this application has been delayed for six months to date and that the expeditious grant of a patent for its invention best serves their interests. Arch Wood acknowledged Osmose’s interest in a timely conclusion of the opposition proceedings but submitted that disadvantage to Arch Wood would be far greater should they be prevented from submitting a significant portion of their evidence.
In my view, any unnecessary protraction of the opposition proceedings is to Osmose’s disadvantage and their interests clearly lie in a timely determination of the validity or otherwise of the patent application and a clear indication of the monopoly grounds that they can not encroach upon. Therefore, I conclude that Osmose’s interests lie in disallowing the extension of time.
Interests of the Patent Office
The interests of the Patent Office, although of no major significance, are in having the opposition matters resolved in a timely manner without undue delay. Considering that significant time has already elapsed since the statement of ground and particulars was served, the interests of the Patent Office favour disallowing further extension of time.
Balance of Considerations
The interests of Arch Wood and Osmose are largely offsetting. Public interest favours an extension of time. Had I been provided a satisfactory explanation of the delay, then the balance of consideration would have clearly favoured the extension. However, the absence of a satisfactory explanation of the delay leaves the considerations finely balanced. Overall, I am of the view that public interest marginally outweighs the other considerations.
Conclusion
I conclude that it is appropriate to grant extension in all the circumstances.
I grant the extension of time to serve evidence in support in respect of the patent application until 18 September 2010.
Costs
Ordinarily in proceedings such as these, costs follow the event. In the present case, Arch Wood have not provided a satisfactory explanation of the delay and have not demonstrated that they have been diligent in preparing their evidence in support. While Arch Wood have been granted the extension they sought, they should not be rewarded by an award of costs in this situation. Furthermore, I consider that Osmose is not entitled to an award of costs as they have been unsuccessful in opposing the extension.
Therefore, I make no award of costs.
Dr S. K. Aggarwal
Delegate of the Commissioner of Patents
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