QIP Nominees Pty Ltd v Delinia, Inc - [2021] APO 24

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
QIP Nominees Pty Ltd v Delinia, Inc. [2021] APO 24
Patent Application: 2015292889

Title:Molecules that selectively activate regulatory T cells for the treatment of autoimmune diseases

Patent Applicant: Delinia, Inc.

Opponent:QIP Nominees Pty Ltd

Delegate:Xavier Gisz

Decision Date: 22 June 2021

Hearing Date: 18 June 2021, in Video Conference

Catchwords: PATENTS - regulation 5.9(2) – extension of time to file evidence in answer – whether there are exceptional circumstances that warrant an extension – extension granted

Representation:
Counsel for the Applicant: Patrick Flynn SC of Eleven Wentworth
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE

Patent Application: 2015292889

Title:Molecules that selectively activate regulatory T cells for the treatment of autoimmune diseases

Patent Applicant: Delinia, Inc.
Date of Decision: 22 June 2021
DECISION

I allow the extension of time under regulation 5.9(2)(b) for the Applicant to file the Evidence in Answer up to 4 May 2021. The consideration of the stay of the opposition is currently taking place and will be decided separately to this decision.
REASONS FOR DECISION

Background

Patent application 2015292889 (the Application) in the name of Delinia, Inc. (the Applicant) is the national phase entry of PCT/US2015/041177 (with publication number WO 2016/014428) which was filed on 20 July 2015. Examination was requested on 15 June 2018. The Application was accepted on 10 February 2020 and acceptance was advertised on 27 February 2020.
A Notice of Opposition to the grant of the patent was filed on 27 May 2020 by QIP Nominees Pty Ltd (the Opponent). A Statement of Grounds and Particulars was filed on 27 August 2020. Evidence in Support was filed on 27 November 2020, and acknowledged on 4 December 2020. Evidence in Answer was, therefore, due on 4 March 2021.
On 19 February 2021 the Applicant filed a request for an extension of time to file Evidence in Answer. This request was accompanied by declarations of Bernard Nutt, Jay Wilusz, and Basil Krikelis. On 21 February 2021 the Applicant filed a declaration by Lisa Taliadoros.
On 24 February 2021 the Delegate requested more information about the circumstances that led up to the request for an extension of time to file Evidence in Answer.
On 26 February 2021 the Delegate wrote to the Applicant asking whether some of the information in the first Krikelis declaration needed to be kept confidential as was suggested in the declaration itself.
On 4 March 2021 the Applicant filed Evidence in Answer comprising a declaration by Mark Rubenstein with annexures MR-1 to MR-6. The cover letter of the Evidence in Answer stated:
“These documents complete the Applicant’s Evidence in Answer”.
On 5 March 2021 the Delegate sent a letter to the Applicant stating:
“We acknowledge a declaration by Mark Rubinstein with Annexures MR-1 to MR-6 on 4 March 2021 which completes the Evidence in Answer.
Evidence in Reply is now due to be filed by the opponent on or before 5 May 2021.”
On 10 March 2021 the Applicant filed submissions on the extension of time and a second declaration of Mr Krikelis and Ms Taliadoros.
On 12 March 2021 the Applicant filed a third declaration by Mr Krikelis which was made in response to the questions asked by the Delegate in the letter of 26 February 2021.
On 16 March 2021 the Deputy Commissioner directed that parts of the first and second Krikelis declarations be made not open to public inspection, i.e. confidential
On 18 March 2021 the Delegate sent a letter to the Applicant stating:
“I refer to the Commissioner's letter of 5 March 2021.
As the parties are aware, there is a request for an extension of time to file evidence in answer that has not yet been determined, therefore the Commissioner's letter of 5 March 2021 was issued in error and should be disregarded.
I apologise for this oversight.”
On 24 March 2021 the Opponent sent a letter to the Commissioner stating:
“We refer to your letter dated 18 March 2021 regarding the Applicant’s request for an extension of time to file its evidence-in-answer (the EOT request). The Opponent was surprised to learn that the Applicant was persisting with the EOT request, particularly after receiving a copy of the declaration of Mark Rubinstein dated 4 March 2021 under cover of a letter from the Applicant’s attorneys, which explained that the Rubinstein declaration completed the Applicant’s evidence-in-answer.
Including for the reasons outlined in your letters dated 24 February and 18 March, the Opponent supports the Commissioner’s findings that the requirements of Regulations 5.9(2)(a) or 5.9(2)(b) are not enlivened in this case.”
On 26 March 2021 the Deputy Commissioner invoked regulation 4.3(2)(b) to make the entirety of the second Krikelis declaration not open to public inspection i.e. confidential.
On 4 May 2021 the Applicant filed another extension of time to file Evidence in Answer, essentially extending the first extension of time request, for a further two months with the total extension of time requested being 4 months.
On 4 May 2021 the Applicant filed proposed amendments to the specification of the accepted application, and requested a stay of opposition until the amendments have been dealt with.
On 7 May 2021 the Delegate advised the Opponent had 21 days to make comments on the amendments. On 27 May 2021 the Opponent requested more time to make comments on the amendments. On 28 May 2021 the Delegate advised the Opponent that they had until 15 June 2021 to make comments on the amendments.
On 3 June 2021 the Delegate proposed the following conditions to decide if a stay would be allowed:
“…[I]f the Opponent makes an undertaking not to oppose the amendments, it would seem to me highly unlikely that the amendments would be refused such that the opposition need not be delayed pending incorporation of the amendments into the specification after the advertisement period. Thus, if the Opponent provides the requested undertaking, I consider that the opposition can continue on the presumption that the amendments will be allowed, thereby obviating any necessity for a stay.
I allow the opponent to provide the requested undertaking by 15 June 2021 by which time their comments on the proposed amendments pursuant to Regulation 10.2(6A) are also due. For the avoidance of any doubt, the Opponent may make whatever comments it wishes, including on the allowability of the amendments or otherwise, whether it provides the requested undertaking or not.
If the Opponent does not make the undertaking requested above, I intend to stay the opposition from the date the amendments were proposed (i.e. 04 May 2021) until two weeks after the Commissioner advises the parties that the amendments are allowed (following the opposition period), refused or withdrawn as the case may be.”
On 10 June 2021 the Opponent provided comments on the amendments, explaining why they believed that the amendments were not allowable. The Opponent did not make an undertaking to not opposed the amendments.
On 15 June 2021 the Delegate stated:
“I note that the opponent has not made an undertaking not to oppose the amendments. Hence, as per my letter of 03 June 2021, I intend to make the following direction:
Stay the opposition except the determination of ‘extension of time’ to file evidence in answer from the date the amendments were proposed until two weeks after the Commissioner advises the parties that the amendments are allowed (following the opposition period), refused or withdrawn as the case may be.
I give the opponent seven (7) days from the date of this letter to provide the requested undertaking in absence of which I will make the intended direction. Please note that the stay will not impact the hearing set out for 18 June 2021 for the matter of determining an extension of time to file evidence in answer.”
On 16 June 2021 the Applicant filed further declarations from Mr Wilusz (Wilusz 2) and Mr Krikelis (fourth Krikelis declaration).
On 16 June 2021 the Applicant requested that the hearing be closed to the public since of confidential information would be discussed. On 17 June 2021 a Delegate informed the Applicant that the matter of confidential information (and whether the Opponent could attend the hearing) would be discussed and a decision would be made at the outset of the hearing.
The hearing was held by video conference on 18 June 2021. Only the Applicant chose to make submissions at the hearing, while the Opponent chose to observe the hearing and make no submissions.
Dealing with confidential information at the hearing
The Applicant proposed that the observer for the Opponent leave the hearing at any time that confidential information was being discussed. The Opponent was amenable to this, and so I directed that that was how the hearing would proceed.
In the hearing I directed that the information that had already been found to be confidential under regulation 4.3(2)(b) would continue to be treated confidentially regardless of its format. That is, any discussion of the confidential information contained in Krikelis declarations, would itself also be confidential.
Is an extension of time required?
The cover letter accompanying the Evidence in Answer on 4 March 2021 stated: “These documents complete the Applicant’s Evidence in Answer”.
On 5 March 2021 the Delegate acknowledged that the Evidence in Answer was complete. On 18 March 2021 the Delegate reverted the acknowledgement that the Evidence in Answer was complete. It is unclear what events precipitated such that the Delegate reverted the acknowledgement. However, it is clear that the Applicant’s actions following the Rubenstein declaration reflect a strong desire for an extension of time to file more Evidence in Answer.
During the hearing I asked why the Applicant had stated that the Evidence in Answer was “complete”. Mr Flynn stated that the Applicant had only intended to express that that part of the evidence of the evidence was complete. Mr Flynn also noted that the Applicant only had enough time to gather evidence (from Mr Rubenstein) on the invention and prior art raised in the Evidence in Support, and did not have enough time to respond to the declaration of Mr Butz.
I am satisfied that an extension of time to file Evidence in Answer is required.
Request for extension of time
The extension of time to file Evidence in Answer was needed because emails about the opposition which were sent from the Australian Attorney (Pizzeys) were not received by the US attorney (McCarter & English LLP) (hereafter referred to as McCarter), and thus the Applicant was only aware of the opposition to their patent one month before the evidence in answer was due.
The submissions filed by the Applicant on 10 March 2021 state at paragraph 8:
“… Ms Sarah Smith of Pizzeys sent the following correctly addressed emails to McCarter:
(a) email dated 4 June 2020 advising receipt of, and attaching, Notice of Opposition dated 27 May 2020;
(b) emails dated 3 September 2020 advising that the Opponent filed a Statement of Grounds of Particulars on 27 August 2020, and that the Opponent now has a further 3 months (i.e. until 27 November 2020) within which to file their Evidence-in-Support, and attaching prior art relied upon by the Opponent;
(c) email dated 4 December 2020 advising that the Opponent filed their attached evidence in support of their opposition on 27 November 2020, and that the Applicant’s evidence in answer will be due in three months;
(d) email dated 7 December 2020 attaching correspondence from the Patents Office and advising that the Evidence in Answer is due to be filed by 4 March 2021; and
(e) email dated 5 January 2021 attaching an application by the Opponent to amend the Statement of Grounds and Particulars;
(the Withheld Emails)”
[Paragraph redacted for confidentiality reasons]
On 24 February 2021 the Delegate explained why he was not satisfied that these circumstances justified an extension of time under Reg 5.9(2)(a):
“I can accept that the email communication failure was unintended, however it is not clear to me that the totality of the evidence indicates that the Applicant was acting reasonably and promptly and diligently. In this regard, while Mr Nutt states that it was not his, or Pizzeys, usual practice to follow up on emails that are not acknowledged by a client, it is not clear to me that this is commensurate with acting reasonably or promptly and diligently in these circumstances. This is due to the fact that Ms Smith had sent very important emails concerning the opposition between 4 June 2020 to 5 January 2021 with no response, including: a notice of opposition; the statement of grounds and particulars (“SGP”); evidence in support (“EIS”); acknowledgement of the EIS and when evidence in answer (“EIA”) would be due; and an amendment to the SGP. It is reasonable to believe that the information associated with those emails would generally elicit a response and the failure to do so, especially over an extended period of time and in view of the strict deadlines in opposition matters, is quite remarkable and failing to follow up on the lack of response does not appear to be commensurate with acting reasonably or promptly and diligently. Consequently, I am having great difficulty coming to the conclusion that the Applicant has met the requirements of Regulation 5.9(2)(a).”
On 18 March 2021 the Delegate stated:
“Turning to the additional information and submissions provided by the Applicant, I am still not satisfied that the requirements of Regulation 5.9(2)(a) or 5.9(2)(b) are enlivened. In this regard several questions/issues come to mind:
·     Did the Applicant make any enquiries regarding why the application had not proceeded to grant?
·     Was there any process in place to check whether any blocked emails were in fact legitimate business emails?
·     Why was the email of 21 January 2021 (20 January 2020 in the United States) not blocked like the other emails? I note that an earlier declaration by Basil S. Krikelis refers to further investigations in this regard.
·     Was it usual for Pizzeys to continue to send emails regarding opposition matters over an extended time period and not make further enquiries where there was no response to, or acknowledgment of, the emails? The lack of any further enquiries does not seem reasonable, even if this was the “usual” practice, given the strict timelines that apply in opposition matters for filing evidence, for example, of which Pizzeys would be well aware.”
[Paragraph redacted for confidentiality reasons]
The Applicant states in their submissions of 10 March 2021 at paragraphs 15-18:
“15. The Senior Examiner seems to be inclined to find that Pizzeys did not act with diligence, because if a client does not respond to emails regarding a patent opposition, the patent attorney must “follow up on the lack of the response” or else they are acting with a lack of diligence. That proposed finding is suggested without any evidence of the usual practice of Australian patent attorneys dealing with overseas clients to support it. There may be any number of reasons why a client does not respond to an email, or a number of emails, and the mere fact that they do not respond does not create a duty on the part of a patent attorney to “follow up” on the non-response. In any case, Pizzeys did follow up by way of a chain of email communications that referred to previous communications.
16. It is respectfully submitted that the Senior Examiner’s proposed approach is a counsel of perfection, made with the benefit of hindsight. Email is a highly reliable, mature technology. Users are accustomed to receiving non-delivery or bounce-back messages if an email is not delivered and it is entirely reasonable to assume, as both Mr Nutt and Ms Smith did, that, in the absence of receiving any non-delivery message, the email has been safely delivered to its intended recipient. That was the assumption made in the present case. It was a reasonable assumption. It is not for Pizzeys to second-guess why a client does not respond to emails or indeed why a client may not wish to defend an opposition proceeding.
17. Further, the Senior Examiner does not explain the form of the “follow up” which it is said Pizzeys should have made. Of course, on the facts of this case, any “follow-up” on the lack of response by way of a further email from Ms Smith would likely have been blocked along with the Withheld Emails.
18. To the extent that the Senior Examiner appears to be disposed to find that a patent attorney is not acting diligently if they do not follow up an email with some non-email form of communication, such as a phone call, such a finding would not sufficiently take into account relevant circumstances including that:
(a) that may impose an impracticable burden on patent attorneys;
(b) due to time differences between the US and Australia, telephone calls are typically not easily arranged during the working day; and
(c) telephone calls are typically arranged in advance by email, and any attempt to arrange such a phone call in advance by Ms Smith would likely have been blocked along with the Withheld Emails in any event.”
The Applicant requested an extension of time under both regulation 5.9(2)(a) and regulation 5.9(2)(b). I will first consider the extension of time under regulation 5.9(2)(b).
Regulation 5.9(2)(b) – exceptional circumstances
Regulation 5.9(2)(b) states:
(2) The Commissioner may extend the period only if the Commissioner is satisfied that:
(b) there are exceptional circumstances that warrant the extension.
"exceptional circumstances " includes the following:
(a) a circumstance beyond the control of a party that prevents the party from complying with a filing requirement under this Chapter;
(b) an error or omission by the Commissioner that prevents a party from complying with a filing requirement under this Chapter;
(c) an order of a court, or a direction by the Commissioner, that the opposition be stayed pending the completion of a related proceeding or action under the Act.
Emails were sent by Ms Smith of Pizzeys on 4 June 2020, 3 September 2020, 27 August 2020, 4 December 2020, 7 December 2020, and 5 January 2021 to McCarter regarding the opposition to the grant of the patent.
Email security measures had been implemented by McCarter to prevent cyber attacks (such as ‘phishing’ attacks) as explained in the Krikelis declarations. These security measures inadvertently and erroneously identified the Ms Smith’s emails as a cyber attack email as explained in the Krikelis declarations. Consequently the emails were never received by McCarter.
The email security measures, detailed in the declarations of Mr Krikelis, have been kept confidential under the provisions of regulation 4.3(2)(b).
It is notable that the emails didn’t merely get redirected into a spam filter at McCarter (which could then have potentially been sorted through to ensure any important emails were not being discarded) and were instead, for all intents and purposes, destroyed. I am satisfied that the emails were simply not received by McCarter.
Although with the benefit of hindsight it can be envisaged that the situation could have been avoided (such as Pizzeys making a ‘follow up’ phone call when no response was received to the emails), such speculation is beyond the realm of what was reasonably beyond the control of the parties. I consider that the emails not being received (with no indication that the email was not delivered) was beyond the control of both the sender (Pizzeys) and receiver (McCarter) of the emails.
I accept Mr Flynn’s oral submissions that the emails not being received is causative of the Applicant being unable to provide all of the Evidence in Answer which they had intended (and the Applicant would have been able to provide if the emails had been received). In this regard, it is obvious that the Applicant was unaware of the opposition up until two months after the time when they should have received the Evidence in Support. It is unreasonable to require the Applicant to prepare in one month that which an applicant has at least 3, and possibly even 6 months (from the time the Statement of Grounds and Particulars is filed), to prepare. Consequently, I consider an extension of time under regulation 5.9(2)(b) to file the Evidence in Answer is appropriate.
Period of extension of time

The Applicant was able to prepare some evidence (the Rubenstein declaration) in the approximately one month between becoming aware of the opposition and the original deadline for filing Evidence in Answer. The Applicant was unable to prepare the remainder of the evidence by the original deadline.
The Applicant has requested 2 months extension of time from 4 March 2021 to 4 May 2021. This is commensurate with the period of time between when they should have received the Evidence in Support and when they actually became aware of the Evidence in Support. Although the Applicant has provided no details about their plan to prepare the remainder of the Evidence in Answer and how much time they anticipate each step of the plan would take, I consider two months to be a reasonable period of time to prepare such evidence.
Further extension of time
A further extension of time was filed on 4 May 2021, together with a request to amendment the specification and a request to stay the opposition.
The further extension of time is superfluous in light of the request to stay of the opposition. The request for a stay essentially supersedes the further extension of time since: a) the opposition can only proceed once the Commissioner provides clarity to the parties about which claims are being opposed (the claims as accepted, or the claims as proposed to be amended), and b) the deadlines for evidence is dependent on when the proposed amendments to the claims are allowed (or refused or withdrawn, as the case may be).
Therefore, I will defer consideration of the further extension of time until a delegate has decided if there should be a stay in the opposition.
Conclusion
I allow the extension of time 2 months under regulation 5.9(2)(b) for the Applicant to file the Evidence in Answer up to 4 May 2021. The Applicant has filed amendments and requested a stay of the opposition from 4 May 2021. The stay of the opposition will be decided separately to this decision.
Xavier Gisz
Delegate of the Commissioner of Patents