Rio Tinto Alcan International Limited v Norsk Hydro ASA - [2014] APO 70

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Rio Tinto Alcan International Limited v Norsk Hydro ASA [2014] APO 70

Patent Application: 2004281345

Title:Al-Mg-Si alloy suitable for extrusion

Patent Applicant:  Norsk Hydro ASA
Opponent:  Rio Tinto Alcan International Limited
Hearing Officer:  P M Spann, Deputy Commissioner of Patents
Decision Date:  24 October 2014
Hearing Date:  Written submissions completed 5 September 2014
Catchwords:  PATENTS – whether there are reasonable grounds for believing that evidence proposed to be filed should not be open to public inspection – reg 4.3(2)(b) – order made – inspection allowed subject to undertakings as to confidentiality.
PATENTS – extension of time to file evidence in answer – reg 5.9 – whether applicant has acted promptly and diligently at all times – extension granted

Representation: Patent applicant: Phillips Ormonde Fitzpatrick, Melbourne
Opponent:Griffith Hack, Melbourne

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2004281345
Title:Al-Mg-Si alloy suitable for extrusion

Patent Applicant:  Norsk Hydro ASA
Opponent:  Rio Tinto Alcan International Limited
Date of Decision:  24 October 2014
DECISION
I grant an extension of the time for filing evidence in reply until 17 November 2014.
I direct that:
-Evidence in reply directed to the homogenisation procedure of Rio Tinto Alcan International Limited, when filed, is not Open to Public Inspection (OPI);
-Rio Tinto Alcan International Limited file at the same time a copy of the evidence from which the sensitive details of the homogenisation procedure including temperatures and times is redacted.
-The redacted copy is OPI.
-The non-OPI evidence be available for inspection by Norsk Hydro’s Australian legal representatives on them giving undertakings to the opponent that the information contained in the evidence will be used only in relation to the present opposition and not be disclosed to any other person.
-Norsk Hydo has leave to apply on reasonable grounds for inspection by a nominated technical expert.

REASONS FOR DECISION

This matter concerns whether there are reasonable grounds for believing that evidence proposed to be filed should not be open to public inspection and a request for an extension of time to file evidence in reply including the proposed confidential evidence. These matters are to be determined under the Patents Regulations as amended on 15 April 2013 by the Intellectual Property Legislation Amendment (Raising the Bar) Regulation 2013 (No 1).
BACKGROUND
Patent application 2004281345 was filed in the name of Norsk Hydro ASA on 15 October 2004 under the provisions of the PCT. It claimed priority from a Norwegian basic application (NO 20034731) which was filed on 22 October 2003. The Australian application was advertised accepted on 22 July 2010 and a notice of opposition under section 59 was filed on 22 October 2010 by Rio Tinto Alcan International Limited (RTAI).
Evidence in support in the section 59 opposition was completed on 26 July 2011. On 22 December 2011, the applicant filed a request for leave to amend the specification under section 104. Evidence in answer was stayed under regulation 5.10(1) pending consideration of the amendment and the opposition filed by RTAI under section 104(4). A delegate subsequently dismissed that opposition and allowed the amendments ([2013] APO 68).
Evidence in answer was completed on 17 March 2014. Being an opposition filed before the commencement of the Raising the Bar Regulation, the time for filing evidence in reply therefore expired on 17 June 2014. RTAI however was successful in obtaining an extension of time to 17 July 2014 citing among other things the change to the opponent’s case resulting from the applicant’s amendments.
On 9 July 2014 RTAI advised the Commissioner that the proposed evidence in reply would include confidential information and requested an order under r 4.3(2)(b). This request was refused on 15 July 2014 with RTAI invited to provide further reasons. A further extension of time was then sought to 17 August 2014 citing ongoing efforts to complete the relevant declarations as well as to deal with the issue of confidential information. After requesting and being provided with further justification the delegate also granted this extension.
During July and August RTAI filed a number of further submissions in relation to the request under r 4.3(2)(b). In each case a delegate responded indicating that the Commissioner was not satisfied that the provisions of that regulation should be invoked. RTAI indicated in its letter of 31 July 2014 relating to the previous extension of time request that “The position that has been reached is that the three declarations that will form the evidence in reply of the opponent have been completed, save for the addressing of the confidentiality issue. It is not possible for the opponent to finalise and file these declarations until the confidentiality issue is resolved.”
On 18 August 2014 RTAI requested a further extension of time to 17 September 2014. It indicated that, because of the Commissioner’s refusal to agree to invoke r 4.3(2)(b), three declarations had been revised to remove confidential information. Two of these were filed on the same day and the third on 20 August 2014. The delegate objected to the extension request on the basis of insufficient information about the reformulation of evidence during the previous extension and that RTAI had not taken up the opportunity, when offered, to be heard on the confidentiality issue. He stated that “It follows that the presence of the ongoing non-OPI request appears to have little bearing on the failure to file evidence in time”.
Subsequently further submissions were filed on the confidentiality issue and extension of time and on 17 September and 15 October further extensions were requested for the period to 17 November 2014. The matters then came to hearing by written submissions. The applicant (Norsk) objects to a direction under r 4.3(2)(b) but has not objected to the extension of time. I will refer to the submissions where appropriate in my reasons below.
SPECIFICATION
The specification relates to an Al-Mg-Si alloy suitable for extrusion at high speed. These alloys contain β-AlFeSi intermetallic particles which convert to the α-form during homogenisation. This phase transformation is critical for extrudibility and a good surface finish in the finished product because the plate-like β-particles (but not the more rounded α-particles) cause local cracks (surface defects) in the extruded material.
When silicon is present in the alloy at levels above 0.50 wt%, β-AlFeSi particles increase in stability and there is a reduction in the transformation to the α-form. This results in a poorer quality extruded product. It was known that the addition of manganese (Mn) at levels above 0.02% avoids this type of problem by promoting β to α phase transformation.
According to the current invention there is an additional benefit with Mn in the alloy composition because it forms AlMnFeSi dispersoid particles during homogenisation. These particles act as nucleation sites for Mg₂Si particles producing a relatively large number of small Mg₂Si particles. The smaller Mg₂Si particles dissolve more easily during the preheating and extrusion and therefore produce a high quality billet.
However the specification also notes that alloys with too high a level of manganese have a lower strength in their extruded profiles so an upper limit was imposed on these Mn levels:
“In view of these observations, it is appropriate to impose an upper limit of the Mn level of the alloys so that one achieves the desired increase in extrudibility with a minimum increase in quench sensitivity. For the 3 examples of extrudibility above, the desired effect of Mn has been achieved for Mn levels in the approximate range 0.02wt% - 0.08wt%. Therefore it is reasonable to set 0.08wt% as an upper limit. It is thought that one in most cases may achieve the desired effect within a lower upper limit, for instance 0.06 wt%.”
Claim 1 as amend states:
1.A homogenised aluminium alloy containing Mg and Si, in particular useful for extrusion purposes wherein said alloy consists of in wt%:
Mg      0.3-0.5
Si        0.35-0.6
Mn      0.035-0.06
Cr       up to 0.05
Zn       up to 0.15
Cu       less than 0.1
Fe       0.08-0.28 and
In addition grain refining elements up to 0.1 wt% and
Incidental impurities up to 0.15 wt%
wherein the alloy further consists of AlMnFeSi dispersoid particles, which are formed during homogenisation and which act as nucleation sites for small Mg₂Si particles which are formed during cooling after homogenisation.
THE LAW
Order under r 4.3(2)(b)
The Patent Act and Regulations do not provide for a disclosure and confidentiality regime specific to opposition proceedings. Rather documents filed in proceedings are subject to the general public inspection and publication provisions of Chapter 4. These essentially provide for standard patents that, from the earlier of 18 months after the earliest priority date or, if earlier, acceptance of the application, the patent specification and all documents associated with the application and in possession of the Patent Office are open to public inspection.
Exceptions to the general rule are provided by r 4.3. These include documents that would be privileged from production in legal proceedings and that are subject to orders of a court or tribunal that prohibit disclosure. Furthermore, for documents filed from the commencement of the Raising the Bar Regulation, r 4.3(2)(b) has provided as an exception “a document that the Commissioner has reasonable grounds for believing should not be open to public inspection.”. This is a significant change to the provision which previously only applied in the circumstances of an order for production.
The relevant Explanatory Statement indicates:
“Item 38 – paragraphs 4.3 (2) (b) and (c)
This item amends the regulations to allow the Commissioner to keep a document confidential if it contains sensitive personal information, or in other appropriate circumstances.
Currently under sections 54 and 55 of the Patents Act, most documents related to a patent application become open to public inspection (OPI) 18 months after the priority date of the application. Occasionally patent applicants and others provide information to the Patent Office that is of a highly sensitive nature and which may not be appropriate for general public inspection. For example, information may be provided to the Commissioner to justify an extension of time and could include details of serious medical conditions, marital difficulties and resulting depression. In such circumstances, general availability to members of the public, with no direct interest in the matter, is not justified.
While documents may be prescribed for the purposes of subsection 55(2) of the Patents Act, so that they do not become OPI, the regulations only account for documents that are subject to legal professional privilege and documents that the applicant was compelled to provide under section 210(c) of the Patents Act via a Notice to Produce. Public access to sensitive information that is provided voluntarily to the Commissioner cannot be restricted or revoked.
This item broadens the Commissioner’s power to make a document non-OPI so that any information that is not appropriate for publication is not published or available to the public, regardless of whether it was subject to a Notice to Produce or not.”
Section 118 and Rule 53 of the UK Patents Act 2007 establish a similar regime. Rule 53 provides:
“53.—(1) Where a person files a document at the Patent Office or sends it to an examiner or the
comptroller, any person may request that the document be treated as a confidential document.
(2) The comptroller must refuse any request where it relates to—
(a) a Patents Form; or
(b) any document filed in connection with a request under section 74A.
(3) A request to treat a document as confidential must—
(a) be made before the end of the period of 14 days beginning immediately after the date on which the document was—
(i) filed at the Patent Office, or
(ii) received by the comptroller, an examiner or the Patent Office; and
(b) include reasons for the request.
(4) Where a request has been made under paragraph (1), the document must be treated as confidential until the comptroller refuses that request or gives a direction under paragraph (5).
(5) If it appears to the comptroller that there is good reason for the document to remain
confidential, he may direct that the document shall be treated as a confidential document;
otherwise he must refuse the request made under paragraph (1).
(6) But where the comptroller believes there is no longer a good reason for the direction under
paragraph (5) to continue in force, he must revoke it.
(7) In this rule references to a document include part of a document.”
It is evident that the policy objectives of the UK and Australian legislation are the same and are intended to provide limited exceptions in circumstances where the public interest fundamentally lies in the disclosure of information supporting the grant of a patent. A summary of the considerations relevant to decisions under Rule 53 were cited by the hearing officer in Pilot Drilling Control Ltd and Smith International Inc [2011] UKIntelP o04611 with reference to the decision of the Court of Appeal in Lilly Icos Ltd v Pfizer Ltd (No2) [2002] EWCA Civ 2, [2002] 1 WLR 2253 and of the Patents Court in Diamond Shamrock Technologies S.A.'s Patent [1987] RPC 91.
Drawing from these sources I consider that principles apposite to the application of r 4.3(2)(b) are that:
- The Commissioner should order that a document not be OPI only if there are reasonable grounds for departing from the normal rule that all filed documents (after the relevant period) are available to the public.
- It is insufficient to merely assert that information contained in the document is commercial in confidence or otherwise sensitive.
- Some real risk of harm must be identified that would follow from disclosure. That harm can be commercial or personal and can include “the indirect effect of inhibiting a party from putting forward their best case” (Pilot Drilling, supra).
- The Commissioner’s decision is to be based on a balancing of the relevant interests including the general public interest which strongly favours disclosure of information which goes to the validity of a patent if granted.
- The public interest also lies in the processes leading to grant, including opposition proceedings, be open and transparent. Where it is reasonable that some information in a document be not-OPI, the public interest will generally be served by requiring a redacted copy of the document be filed that is OPI.
- It follows that to the extent that information in a document relates to personal circumstances or is incidental or irrelevant it is more likely that an order will be made. In those cases the public interest may be met by requiring that a copy of the document with the information redacted be made open to public inspection.
- On the other hand, it is less likely to be reasonable that documents directly relevant to validity including submissions and evidence rebutting grounds of objection or opposition should be not-OPI.
If a document is not OPI it may be made available for inspection by order of the Commissioner under section 56(1)(b). In the case of opposition proceedings it is normal for inspection to be allowed subject to conditions. These will include requiring undertakings of confidentiality and restrictions on the persons who may inspect documents.
Inspection will usually be limited to a party’s legal representative or an employee of the legal representative or an independent third party expert. In certain circumstances, such as ownership disputes, the other party would be granted restricted access if it could be shown that access was essential in the interests of justice and there would be no breach of duty of confidentiality. (See Davies v Eli Lilly & Co. (1987) 1 All ER 801).
Extension of time
As the period for filing evidence in reply commenced after 15 April 2013, the current request for an extension of time is to be determined under regulation 5.9 as amended on 15 April 2013 by the Intellectual Property Legislation Amendment (Raising the Bar) Regulation 2013 (No 1) – See subregulation 23.26(2)(Item 2). That item also provides that the reference in subregulation 5.9 (1) to regulation 5.8 is taken to be reference to regulation 5.8 as in force before 15 April 2013 and paragraph 5.10(1)(b) and subregulation 5.10(2) as in force before 15 April 2013 are taken not to apply.
Consequently while the present opposition was filed before 15 April 2013, and generally is governed by the provisions of Chapter 5 of the regulations that applied before that date, extensions of the time for filing the evidence in reply are governed by the new scheme reflected in r 5.9 as in force from 15 April 2013.
Subregulation 5.9(1) gives the Commissioner the power to extend the evidentiary time periods:
“The Commissioner may extend an evidentiary period mentioned in regulation 5.8:
(a) if requested in writing by a party; or
(b) on the Commissioner's own initiative.”
The power to extend time is discretionary, as evidenced by the use of the word "may". This power is qualified by subregulation 5.9(2), which states:
“The Commissioner may extend the period only if the Commissioner is satisfied that:
(a) the party who intended to file evidence in the period:
(i)has made all reasonable efforts to comply with all relevant filing requirements under this Chapter; and
(ii)despite acting promptly and diligently at all times to ensure the appropriate evidence is filed within the period, is unable to do so, or
(b) there are exceptional circumstances that warrant the extension.”
Exceptional circumstances are defined in subregulation (5):
“In this regulation:
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.”
Consequently the relevant questions are :
1. Has the party (and their attorney or agent) made all reasonable efforts to comply with all relevant filing requirements?
1. Was the failure to file the evidence in time despite the party (and their attorney or agent) acting promptly and diligently at all times to ensure the evidence is filed in time?
1. Were there exceptional circumstances that warrant the extension?
I can extend the time for filing evidence only if I am satisfied that the answer to questions i and ii is YES, or if I am satisfied that the answer to question iii is YES. If I am so satisfied, then I must consider whether there are any discretionary reasons why the extension should not be granted.
In considering the legislation I further note that the Explanatory Statement accompanying the Intellectual Property Legislation Amendment (Raising the Bar) Regulation 2013 (No 1) states at page 19 that:
“In applying the test, the Commissioner will not be required to give a direction to extend a period solely because of delays caused by a legal representative failing to act promptly or diligently, by difficulties in obtaining expert evidence that could have been anticipated and acted on or by attempts to settle the proceedings”
If granting an extension the Commissioner must under r 5.9(3) “determine the length of the extended period having regard to what is reasonable in the circumstances”.
CONSIDERATION
Order under r 4.3(2)(b)

For convenience I will first consider RTAI's request that evidence proposed to be filed be not open to public inspection (not-OPI).
Originally an order was sought in relation to three categories of information but is persisted with only in relation to RTAI's homogenisation procedure which it submits was in use before the relevant priority date. It is said that:

"the purpose of the confidential information is to establish an evidence link between test work on an alloy produced and sold after the priority date and the same alloy produced and sold before the priority date. The actual homogenisation treatment is not important. What is important is that the homogenisation treatment has not changed from late 2001 to the present date."

RTAI further submitted in correspondence dated 3 September 2014 that:
- “The specific nature of the information that is confidential.
-The information relates to the homogenisation procedure of the opponent from before the priority date to the present date. The information includes specific homogenisation temperatures and times for the alloy that the opponent relies on in evidence. The information is in two internal documents of Rio Tinto Alcan that notify relevant Rio Tinto Alcan personnel of the change in homogenisation procedure that was made during late 2001 and the details of the changed procedure.
- How the disclosure of the information would damage commercial interests.
-The opponent has a very considerable business in the production of aluminium alloys and has built that business over decades on the back of in-house research and development. The selection of homogenisation procedures comprises some of the confidential information that the opponent has developed in that time. The advice of the opponent is that releasing confidential information relating to the homogenisation procedure for the alloy relied on in evidence would provide the applicant with valuable information that could damage the commercial interests of the opponent.
- Why the information cannot simply be redacted from, or left out of, the evidence.
-We are discussing the issue of redacting the documents with the opponent. Basically, it would be necessary to redact substantially all the information in the documents. We have concerns about this approach. In particular, we do not want to be faced with an objection that the redacted documents cannot be relied on because of the extent of the content redacted from the documents.”

The circumstances then appear to be that specific homogenisation temperatures and times are not important but RTAI seeks to prove a link between alloys produced after the priority date and those produced before and that it considers it cannot make out that case if it files evidence with the specific information redacted.

RTAI as for all opponents in pre Raising the Bar oppositions faces a considerable evidentiary burden and it appears to me that is more so in an attempt to demonstrate publication through sale of the opponent's own product. Prima facie, the availability of evidence with specific information on the homogenisation process at particular dates may well be significant to RTAI's case even if actual temperatures and times for the homogenisation process is not.
Therefore, in balancing the public and private interests referred to above it appears that the public interest in the disclosure of specific details of the homogenisation process conducted by RTAI is relatively weak and is offset by the interest in RTAI being able to present its best case. The public interest can also be addressed by a direction that a redacted copy of the non-OPI evidence be filed and be available to the public. Consequently, subject to determining that an extension of time should be granted, I intend to make an order under r 4.3(2)(b).
If that order is made it follows that I must also make a direction under section 56 permitting Norsk inspection of the proposed evidence. RTAI submit that this should be limited only to Norsk's Australian attorneys while Norsk argues that this would deny it of the assistance of its internal technical experts such that the evidence could be properly tested.

Since the purpose of the proposed evidence is apparently to show the use of a common process over time rather than its technical details I am inclined to follow the normal course and limit inspection to Norsk's Australian legal representatives. The need for access by Norsk’s internal technical experts is not immediately apparent nor is justified by Norsk’s submissions. Nevertheless if, once the proposed evidence is filed, Norsk applies and gives credible reasons for access by a nominated technical expert, that request will be determined on its merits, subject to the parties being heard.
Extension of time
The delegate’s objections to the extension of time requested on 18 August are reflected in the Commissioner’s letter of 21 August. These include that there was insufficient information provided about the process of completing the three declations already filed and the effect of the on-going non-OPI request. The delegate states that “It follows that the presence of the ongoing non-OP request appears to have little bearing on the failure to file evidence in time.
Some criticism may be attached to the way the r 4.3(2)(b) was handled by RTAI including that its request in relation to two of the three categories of information were ultimately withdrawn. Nevertheless it has successfully submitted that a non-OPI order be made in relation to the third category. I think that in this regard the delegate has been overly critical of the endeavours of RTAI to complete its evidence. Together with the information provided in its submissions filed on 3 September I consider that it has been reasonably diligent in the preparation of evidence given its concerns about confidentiality and the need to have that matter resolved.
Had it been apparent that RTAI had delayed raising the matter of confidentiality or pursued it unreasonably this this would not be the case. However there has not been undue delay and I allow some latitude given that the application of the Commissioner’s powers under amended r 4.3(2)(b) to particular factual circumstances must necessarily be uncertain until cases of this nature are decided.
I am therefore of the view that:
- RTAI (and their attorney or agent) has made all reasonable efforts to comply with all relevant filing requirements; and
- the failure to file the evidence in time was despite RTAI (and their attorney or agent) acting promptly and diligently at all times to ensure the evidence is filed in time.
I further do not consider that there are discretionary grounds that favour refusal of the request and consequently I will grant an extension of time for the filing of RTAI’s evidence in reply. Given that the non-confidential evidence has apparently already been filed and the remainder should be at hand I will allow under subregulation 5.9(3) the period to 17 November 2014 for the filing of the evidence.
Conclusion
I am satisfied that it is reasonable in the circumstance for evidence proposed to be filed be not open to public inspection to the extent that it concerns the disclosure of specific details of the homogenisation process conducted by RTAI. I will make orders accordingly including for inspection of the non-OPI evidence once filed.
I am further satisfied that an extension of time to 17 November 2014 should be granted for RTAI to file its evidence in reply.
Costs
I make no award costs. While RTAI have been successful, Norsk did not oppose its extension of time and made only limited submissions on the matter of confidentiality. In the circumstances it appears appropriate for the parties to bear their own costs.
P M Spann
Deputy Commissioner of Patents