SANYO ELECTRIC CO LTD

[1995] APO 35

official notice

decision of a delegate of the commissioner of patents

Patent:    No. 592800 in the name of SANYO ELECTRIC CO. LTD.

Title:    DC Brushless Motor Driven Fan.

Action: An application under section 223 for an extension of time to pay a renewal fee.

Decision:    Issued            .

Abstract: Failure for renewal fee to be timely paid found to be because of an error or omission. However, there were considerable delays in filing the request for an extension of time and subsequently in filing the statutory declaration in support. In relation to the exercise of the discretionary powers conferred by section 223(2), found that the delays were detrimental to the public interest and that the public interest prevails in the circumstances of the case over the private interests of the patentee. Grant of extension of time refused.

patents act 1990

decision of a delegate of the commissioner of patents

Re:Patent No. 592800 to SANYO ELECTRIC CO. LTD., and an application under section 223 of the Patents Act 1990 for an extension of time to pay a renewal fee.

background

Patent No. 592800 is dated 29 May 1986 and was granted on 10 May 1990 to Sanyo Electric Co. Ltd. ("Sanyo").

Patent 592800 ceased on 29 May 1990 when the fourth year renewal fee was not paid either by the anniversary date of 29 May 1990 or (upon payment of an additional fee) within the grace period of 6 months after that date. The patent was advertised ceased in the Official Journal on 7 March 1991.

On 7 September 1993 Sanyo, through its Australian patent attorneys Davies Collison Cave, filed a request under section 223(2) to extend the time in which to pay the renewal fee due by 29 May 1990. Fees remitted with the extension request were the base fee for filing a section 223(2) request and the fourth and fifth year renewal fees. (On 12 January 1995 outstanding fees corresponding to a section 223(2)(a) request for an extension of time of 40 months were paid as well as the sixth, seventh and eighth year renewal fees).

By letter dated 2 August 1994, the patentee was informed that as no declaration had been filed to complete the section 223 request the Commissioner intended to refuse the request and sought advice as to whether Sanyo wished to be heard in the matter. On 1 September 1994 a statutory declaration in support of the extension request was filed.

By letter dated 22 September 1994 the patentee was advised that insufficient justification had been provided in support of the request and that because the extension sought was for the considerable period of 40 months "... it is likely that the Commissioner will consider the granting of an extension of time for that duration to be contrary to the public interest." Following a response on behalf of the patentee dated 17 October 1994, the patentee was then advised, by letter dated 25 October 1994, as follows:

"Although the renewal fee due in 1990 was not paid, Patent Office records show that

(1) Computer Patent Annuities attempted to pay the 5th year renewal fee on 23 April 1991, and
(2) there was no attempt to pay renewal fees in 1992.

The declaration of Yamada states that CPA was instructed to pay renewal fees commencing with that due on 29 May 1991.

Given this instruction, and the attempted payment by CPA on 23 April 1991, it is not apparent why
(1) the patentee took no action following the ineffective payment on 23 April 1991 to rectify the payment due in 1990, or
(2) if the patentee was not aware of the ineffective payment, why no attempt was made to pay the fee due in 1992.

In the absence of further clarification, this situation is prima facie indicative that it has not always been the intention of the patentee to keep the patent in force.

You are invited to provide further submissions on this point. You are also invited to provide submissions to explain the delay between filing the request for an extension of time on 7 Sept 1993 and the declaration in support filed on 1 Sept 1994 which, in addition to the extension being for a period of 40 months, is itself indicative of undue delay.

In any event the matter will be set for hearing ... on 14 December 1994 ...."

The hearing was deferred at the request of the patentee's agent who subsequently provided further materials in support of the extension request by letter dated 12 January 1995.

The hearing took place in Canberra on 16 January 1995. Mr Greg Noonan, patent attorney of Davies Collison Cave, appeared by telephone for Sanyo.

THE LEGISLATION

The provisions of section 223 relevant to the present request for an extension of time are as follows:

"(2) Where, because of:
(a) an error or omission by the person concerned or by his or her agent or attorney; or
(b) circumstances beyond the control of the person concerned;
a relevant act that is required to be done within a certain time is not, or cannot be, done within that time, the Commissioner may, on application made by the person concerned in accordance with the regulations, extend the time for doing the act.

(3) The time allowed for doing a relevant act may be extended, whether before or after that time has expired.

(4) Where an application is made for an extension of time for more than 3 months, the Commissioner must advertise the application in the Official Journal.

...

(6) A person may, as prescribed, oppose the granting of the application.

(7) Where:
(a) ... a patent ceases, because of a failure to do one or more relevant acts within the time allowed; and
(b) the time for doing that act or those acts is extended;
the ... patent must be treated as having been restored.

...

(9) Where an extension of time for more than 3 months is granted for doing a relevant act, the prescribed provisions have effect for the protection or compensation of persons who, before the day on which the application for extension of time is advertised under subsection (4), exploited (or took definite steps by way of contract or otherwise to exploit) the invention concerned because of the failure to do the relevant act within the time allowed, ... the ceasing of the patent ... .

(10) Infringement proceedings cannot be brought in respect of an infringement committed:
(a) ...
(b) between the day on which the patent ceases and the day on which it is restored.

(11) In this section:
"relevant act" means an action (other than a prescribed action) in relation to a patent, a patent application, or any proceedings under this Act (other than court proceedings) ... ."

Section 223 has application to extend the time to pay a renewal fee since the doing of an act in accordance with regulation 13.6(1) or 13.6(3) is not identified under regulation 22.11(3) (as at the date of filing of the present request for extension of time, but later amended) as a prescribed action to which section 223 does not apply.

The provisions of regulation 22.21 relevant to section 223(9) are as follows:

"(2) Persons who availed themselves of or exploited, or took definite steps by contract or otherwise to avail themselves of or exploit, inventions ... in the case of inventions to which subsection 223(9) of the Act applies - within the period of time extended under that subsection; may apply, in the approved form, to the Commissioner for the grant of licences to exploit the inventions.

(3) An applicant for a licence must serve a copy of the application on a person whose application or patent ...
was so restored ... and to such other persons as the Commissioner reasonably directs.

(4) A person on whom a copy of an application has been served may oppose the grant of the licence.

(5) the Commissioner, if reasonably satisfied that the application should be granted, must grant a licence to the applicant on such terms as the Commissioner thinks reasonable."

THE REQUEST FOR AN EXTENSION OF TIME

The request

In the request for an extension of time it is stated that:

"The circumstances in which, and the grounds upon which, this application is made will be detailed in a statutory declaration to be lodged separately."

The declaration

The statutory declaration is dated 23 August 1994 and is expressed in the following terms:

"I, YOSHITO YAMADA, of ... Osaka, Japan ... .

1. I am principal of Yamada Patent Office (... "my firm") of the above address. ... .

2. My firm has been responsible for the above patent and its predecessor application since 1986, on instructions from the Japanese proprietor client (... "the client").

3. The patent was sealed on 10 May 1990. On 22 June 1990, my firm received a letter from the client concerning responsibility for renewal fees in respect of the patent. A copy of this letter is attached hereto as Exhibit YY-1 and I confirm that it is a true and correct copy of that letter. It will be seen that the letter had a specific reference to Australian Patent 592800. I confirm that the letter instructs my firm that the renewal fee which was due to be paid by 29 May 1990 was to be arranged by my firm, whereas, commencing with the renewal fee due 29 May 1991, Computer Patent Annuities (CPA) was to assume responsibility for renewal fees on the patent.

4. On 28 November 1990 my firm received a reminder fax from our Australian associates, then known as Davies & Collison, concerning the renewal fee due to be paid by 29 May 1990. This fax followed earlier reminders received from Davies & Collison. On the same day, 28 November 1990, my firm forwarded a return fax to Davies & Collison which comprised a message typed on a returned copy of Davies & Collison's fax. A copy of the thus returned fax message is attached hereto as Exhibit YY-2 and I confirm that this is a true and correct copy of the fax in question.

5. The returned fax message copied as Exhibit YY-2 erroneously instructed Davies & Collison that it was not necessary for them to pay the renewal fee due on 29 November 1990. As evident from Exhibit YY-1, my firm should have instructed Davies & Collison to pay the 1990 renewal fee as the payment of renewal fees through CPA was not due to commence until the 1991 fee.

6. In August 1993 the client informed my firm that the subject patent had lapsed through non-payment of a renewal fee, and that this was clearly contrary to their intention. My firm wrote to Davies & Collison on 25 August 1993. Davies & Collison wrote back on 3 December 1993 confirming that the patent had indeed lapsed and drawing our attention to the fax message copied hereto as Exhibit YY-2. They also advised us that we could apply to reinstate the application and we instructed them to do so on 6 September 1993.

7. I confirm that it has always been the patentee's intention that the subject patent be kept in force by payment of renewal fees. The patent lapsed through non-payment of the 1990 renewal fee due to our error in wrongly instructing Davies & Collison not to pay the 1990 fee, contrary to the instructions received from the client on 22 June 1990. This error appears to have arisen in turn from an error in interpreting and recording the letter received from the client on 22 June 1990."

Other supporting material

On 12 January 1995, Mr Noonan filed a copy of a letter from Mr Yamada dated 11 January 1995. In this letter Mr Yamada says that he is responding to queries put by Mr Noonan in a letter dated 14 December 1994. In relation to the following relevant extracts from Mr Yamada's letter, I note that at the hearing Mr Noonan informed me that "NGB" are the agents in Japan for CPA:

"... a person who was in charge of the subject patent has retired from Sanyo ... and therefore there are points not clear in detail for a person who is being in charge of the subject patent.

Sanyo noticed that no debit note in connection to the annuity of the subject patent was sent to Sanyo from NGB (Nippon Gijutsu Boueki K.K.), but a time when Sanyo noticed is unclear. Then, Sanyo sent to NGB a letter for inquiring about why no debit note was issued (no copy of the inquiry letter exists). In response to the inquiring letter, NGB sent to Sanyo reply letters of June 22, 1993 and July 8, 1993 (copies of the letters are attached as EX1 and EX2).

In the EX1, NGB replied that in summary

(1) The annuity control was transferred to NGB by the letter of June 5, 1990.

(2) NGB took necessary steps for paying the 6th annuity (May 29, 1991), but no reminder in connection to the 8th annuity (1993) was received from CPA, and therefore, NGB sent the reminder to CPA.

(3) On the other hand, NGB investigated the file record in NGB, and then, it was clear that the same situation occurred in the last year (1992).

(4) In connection to the subject patent, NGB found no vestige of receiving the usual reminder from CPA, and therefore, NGB forgot to send to Sanyo any communication.

(5) CPA was notified by Australian Patent Office that the subject patent had lapsed on April 26, 1989; however, since the filing date is May 29, it cannot be considered for NGB that the cause of the lapse is non-payment of the annuity, and therefore NGB considered another cause. In addition, there was a possibility that Patent Office notified to CPA erroneous date that the subject patent had lapsed.

In the EX2, NGB replied that in summary

(1) In connection to the subject patent, NGB received a copy of the original register (EX3).

(2) "Fee history" of the original register shows that the annuity last paid is of 1989, and therefore, it seems to NGB that the cause why the subject patent has lapsed is the non-payment of the annuity having the due date May 29, 1990 just before the transferred date June 5, 1990.

(3) Previous information that the date of lapse is April 26, 1989, but it was the date on which the last annuity was paid.

(4) In connection to the subject patent, the due date for the annuity came just after the sealed advertised date May 24, 1990, and just after the due date of the annuity the subject patent was transferred to NGB, and therefore, NGB considered that any inconsistency occurred in the communication between the patent agent in Japan and the patent agent in Australia.

Accordingly, as to your question, "ask Sanyo to confirm that they never received any advice from NGB that the 1991 annuity payment was ineffective and the patent had lapsed, we reply "Yes".

Furthermore, from NGB, debit note for 1991 annuity was sent to Sanyo (a copy is attached as EX4), but no further debit note for 1992 annuity was sent. Therefore, as to your question, "ask Sanyo to confirm that they never received any reminders or debit notes from NGB in connection with the 1992 annuity, we reply "Yes".

As to your question, "ask Sanyo exactly how and when they learnt that the patent had lapsed", we cannot reply the exact date but prior to June 22, 1993."

In his letter dated 12 January 1995, Mr Noonan said that he had recently been advised by the Patent Office that no copy of the letter advising CPA that the patent had ceased was on the file of 592800. Subsequently a copy of this letter was found and was faxed to Mr Noonan just prior to the commencement of the hearing. The letter in question is dated 14 May 1991 and was sent following CPA's attempt on 23 April 1991 to pay the 5th year renewal fee. The letter correctly advises CPA that 592800 had ceased but incorrectly states the date of ceasing to be 26 April 1989 (the correct date being 29 May 1990). The letter further advises that "the renewal fee payment ... is available for refund by completing and returning the enclosed (form) TF 17."

SUBMISSIONS

At the hearing I advised Mr Noonan that I was satisfied that it had been established that the reason for the failure to pay the renewal fee due by May 29 1990 was because of an error by an agent of the patentee. I therefore invited Mr Noonan to base his submissions on considerations relevant to the exercise of the Commissioner's discretionary powers conferred by section 223(2)(a), in particular the matters raised in the letter from the Patent Office dated 25 October 1994.

I summarise Mr Noonan's main submissions as follows:

1. In determining if a delay is undue, it is relevant to consider whether the delay was unreasonable or unnecessary in the circumstances of the case. In support of this view Mr Noonan referred me to the decision of the Federal Court in Board of Control of Michigan Technological University v Deputy Commissioner of Patents (1981) 34 ALR 529 at 535.

2. The period of extension sought is for 40 months but this period should not be considered to be excessive in view of the surrounding circumstances. It would not be reasonable to expect that Sanyo should have become aware that 592800 had ceased merely because it had been so advertised in that obscure publication The Australian Official Journal of Patents. It appears that NGB received (via CPA) the letter from the Australian Patent Office advising that the patent had ceased but that NGB may have been confused because the date of ceasing advised could not be correct. It is not clear whether NGB took any action concerning the notification of ceasing at this stage but in any event it appears that they did not inform Sanyo of the situation. Sanyo relied on reminders from NGB but the last such communication received by Sanyo was a debit note for the annuity due in April 1991. Thus there was no trigger for Sanyo to take action until they noticed in mid-1993 that they had not been receiving debit notes for annuity payments from NGB.

3. Although the declaration by Mr Yamada was not filed until over 11 months from when the request for an extension of time was filed, this period should not be considered to be excessive in view of the surrounding circumstances. Thus at the time that the section 223 request was made it was not known what exactly were the circumstances which lead to the failure to pay the 4th year renewal fee by the due date. The circumstances surrounding that failure and subsequent related events involved lapses in a complex chain of communication involving four parties, three countries and two languages. It took several exchanges of correspondence, involving some translation difficulties, to establish the relevant facts and not unreasonably this process took more time than would normally be expected in relation to a more straightforward matter.

4. There is no legislative provision concerning the matter of delay in relation to a section 223 request for extension of time. Furthermore the public interest is protected by subsections (4), (6), (9) and (10) of section 223.

5. The circumstances apparent from the materials provided in support of the request are not inconsistent with the statement in Yamada's declaration that it has always been the patentee's  intention that the subject patent be kept in force by payment of renewal fees.

DECISION

Soon after the hearing I considered the requirement of subsection 223(4) regarding advertisement of the request, noting that the compensation provisions of subsection 223(9) link to the advertisement date. I had not yet determined whether discretion could be exercised favourably but because the patentee had presented reasons why discretion could be so exercised, it seemed to me to be reasonable that advertisement should occur at this juncture. Accordingly I directed advertisement of the extension of time request. The advertisement appeared in the Official Journal dated 2 March 1995. No person has filed opposition under section 223(6) to the grant of the extension request.

Error or omission

Before the Commissioner can exercise discretionary powers under section 223(2)(a), it is an essential precondition that the existence of a relevant error or omission be established. From the material provided in support of the extension request, I am satisfied that in the period of time immediately preceding the due date for payment of the 4th year renewal fee it was Sanyo's intention that the fee be timely paid, and that the reason that it was not was because Sanyo's agent (Yoshito Yamada), made the error of not instructing Australian associates (Davies & Collison) to pay that fee because Yamada had erroneously thought that CPA had been instructed to pay that fee.

Discretionary considerations

In the Federal Court decision Ferocem v Commissioner, (1994) AIPC 91-057, Burchett J., in relation to a request for an extension of time under regulation 5.10, said:

"The determination of an application for an extension of time ... involves a balancing exercise, in which competing considerations must be taken into account."

In Board of Control of Michigan Technological University v Deputy Commissioner of Patents (1982) 52 AOJP 1992, the AAT, in relation to a request for an extension of time under section 160 of the Patents Act 1952, said

"In my view, time should be extended in favour of the applicant unless the public interest can be seen to prevail over the applicant's interest."

In the present case, I believe that the underlying issue relevant to the exercise of discretion is the question of where the balance lies between the interests of the patentee and those of the public.

Section 97 of the Patents Act 1952 provided that there be no undue delay in the making of a request for restoration of a patent. I note that there is no equivalent precondition in section 223(2) of the Patents Act 1990, even though under the Patents Act 1990 all restoration matters have been included within the extension of time provisions of section 223. Nevertheless I am of the view that delay in making a request for extension of time is a relevant consideration in relation to the public interest and hence material to the exercise of discretion. I find support for this view within the judgement of the High Court in Board of Control of Michigan Technological University v Deputy Commissioner of Patents (1982) 40 ALR 557 wherein (although the extension of time under the former section 160 was not under appeal) Aickin J. at 587 made the obiter observation that:

" ... delay or undue delay in making such application (for extension of time) is not expressly referred to in section 160 (of the Patents Act 1952), but would plainly be material to the consideration of the application in so far as it might affect third parties."

From the material supplied in support of the request, some of which I note is not in declaratory form, it is possible to construct the following chronology of events:

10 May 1990      Patent sealed.

29 May 1990      4th year renewal fee due.

5 June 1990      Annuity control transferred from Yamada Patent
                 Office to NGB.

22 June 1990     Yamada Patent Office receives instruction from
                 Sanyo to arrange for 4th year renewal fee to be
                 paid and advice that CPA was to assume
                 responsibility for future renewals.

28 November 1990  Yamada Patent Office responds to final reminder
                 from Davies & Collison by advising them that no
                 action is required because the annuity is now
                 controlled by CPA.

29 November 1990  Renewal fee not paid within period of grace.
                 The patent therefore ceased on 29 May 1990.

7 March 1991     Ceasing of the patent advertised in the
                 Official Journal.

23 April 1991     CPA attempted to pay the 5th year renewal fee.

14 May 1991      The Australian Patent Office advises CPA that
                 the patent has ceased.

?                CPA advises NGB that the patent has ceased.

?                Sanyo notices debit notes for renewal fees not
                 received from NGB.

?                Sanyo asks NGB, why no debit notes?

22 June 1993     NGB advises Sanyo that the patent has ceased

and provides some information about the

surrounding circumstances.

8 July 1993      NGB provides Sanyo with more information.

7 September 1993  Sanyo requests extension of time to pay the
                 4th year renewal fee due by 29 May 1990.

1 September 1994  Yamada declaration filed in support of the
                 request.

12 January 1995   Additional material in support filed including
                 some explanations for delays.

Clearly there have been delays associated with the making of the present request for extension of time, and with the provision of material in support of the request, and with the provision of explanations for the delays. At issue then is whether there has been delay which in all the circumstances has been detrimental, or potentially detrimental, to the public interest.

In considering the delays in this case, I note that the patent was advertised ceased in March 1991 and that CPA were advised that the patent had ceased in May 1991. I think it reasonable to presume that Sanyo should have become aware that the patent had ceased by July 1991 at the latest. From the material supplied in support it appears that CPA informed NGB that the patent had ceased. Hearsay evidence (in Yamada's letter of 11 January 1995) suggests that NGB did not immediately inform Sanyo that the patent had ceased. I attach little weight to this hearsay information, particularly since it does not seem to be inherently probable or reasonable that NGB, even if confused about the incorrectly notified date of ceasing, would not have informed Sanyo that notification had been received that the patent had ceased. I note that I have no direct evidence before me from Sanyo as to the date when they became aware that the patent had ceased. In any event it is ultimately the responsibility of the patentee to monitor the renewal process. In the present case there is nothing to suggest that Sanyo had an adequate monitoring system in place such as would be reasonably expected as being commensurate with continuing interest in maintaining its rights in the patent. I therefore conclude that the period of over two years from July 1991 (by when Sanyo should have, and quite possibly did, become aware that the patent had ceased) to September 1993 (when Sanyo requested extension of time) constitutes a delay in respect of which an adequate explanation has not been provided.

Regulation 22.11(1) provides that:

"For the purposes of subsection 223(2) ... an application for extension of time must ... have with it a declaration setting out the grounds upon which the declaration is made."

The form that the declaration shall take is specified in regulation 22.13.

It is the practice of the Patent Office to encourage requests for extension to be filed as early as possible even if the declaration is not immediately available. However, it is then expected that there will be minimal delay in filing the declaration as soon as possible thereafter. In the present case there was a delay of over 11 months from when the extension of time request was filed until the declaration was filed. In relation to this considerable delay I note that some explanatory  material (albeit not in declaratory form) has been filed, and I accept Mr Noonan's submissions that there were some complexities and difficulties in determining the nature of the error or omission and in finalising the declaration. However, whereas I am satisfied that it has been established that there were legitimate reasons for some delay in filing the declaration, I do not accept that those reasons are commensurate with reasonable diligence in the context of a delay of the magnitude of over 11 months.

In Vangedal-Nielsen v Smith (Commissioner of Patents) & Gelphen Nominees (1980) 33 ALR 144, in relation to a request under section 59(1) of the Patents Act 1952 for an extension of time to lodge a notice of opposition to the grant of a patent, Bowen CJ said:

"It would be wrong if he (the Commissioner) granted an extension simply because no one had raised rather exceptional circumstances why it should not be granted. Reasons why this is so include the desirability of operating the system efficiently and without unreasonable delays ... ."

In the context of the operation of the system for renewal of Australian standard patents, I consider it relevant to the issue of whether the delays previously identified are detrimental, or potentially detrimental, to the public interest to consider the question of what are the legitimate expectations of the public as to what may happen subsequent to no effective action having been taken to renew a patent.

The system for renewal of an Australian standard patent is that renewal fees are payable annually and are due by the date of the anniversary of the patent. The renewal fee, plus late fees, may also be paid within the 6 month period following the anniversary date (the so-called period of grace). If the renewal fee is not paid by the end of the grace period, the patent is then advertised shortly thereafter as being ceased as of the anniversary date that the renewal fee was due. However the public should know that there are provisions whereby an application  may be made for a ceased patent to be restored, and that there is a high level of probability of that happening in the period from 6 to 12 months from the date of ceasing. It is, I think, foreseeable that a patentee may only learn that its patent has ceased following an unsuccessful attempt to pay the next renewal fee. Thus, in the period from 12 to 24 months from the date of ceasing, the public should still be reasonably aware of the possibility that an application for restoration may be made but expect that the likelihood of that happening will progressively lessen with time towards the end of that period. I think that if by the date of the next anniversary of the patent, that is 2 years from the date of ceasing of the patent, no application for restoration has been made, then the public should be entitled to assume that it is highly likely that the reason why no restoration is in progress is either that the patentee decided not to renew or that the patentee has completely failed to meet its onus to adequately monitor the renewal process for its patent. Against this background, I am therefore of the view that if no application for restoration has been made within 2 years from the date of ceasing of the patent, then the public should legitimately be entitled to have the expectation that it is highly likely that from that time onwards the patent will remain ceased.

Ultimately, the exercise of the Commissioner's discretionary powers under section 223(2) will always depend on the facts of each case. However, consequent upon what I have said above, even where it has been established that the reason for a failure for a renewal fee to be timely paid was because of "an error or omission" or "circumstances beyond control", it follows that:

(i)   if a request for an extension of time is properly made within 6 to 12 months from the date of ceasing, the interests of the patentee will normally outweigh the interests of the public.

(ii)  if a request for an extension of time is properly made within 12 to 24 months from the date of ceasing, the interests of the patentee will normally outweigh those of the public in the early part of that period but the balance of those interests will normally tend to equalise towards the end of that period.

(iii) if more than 24 months have elapsed from the date of ceasing until a request for an extension of time is properly made, the interests of the public will normally outweigh the interests of the patentee.

Although no person has opposed the present request for extension of time, it is still possible that some person could be prejudiced if the patent were to be restored. In the present case there was a delay of over 3 years from when Sanyo became (or should have become) aware that the patent had ceased until the statutory declaration in support of the request for an extension of time was filed. In this situation, I think it unreasonable that a person who wished to exploit the invention could not do so unfettered but rather would be exposed to the inconvenience of the consequences of restoration such as are inherent in the provisions of regulation 22.21 (having to apply for a license, which application may be opposed). Thus having considered the protection and compensation provisions of section 223, I am of the view that they are not adequate to counterbalance the detrimental effect upon the public interest of allowing the patents renewal system to be characterised by an unreasonable degree of uncertainty such as would result if I were to find that little weight should be attached to the consequences of unjustified lengthy delays such as I have found in the present case.

I believe that the delays which I have found in the present case have not been justified and that they weigh against the public interest in being able to have a reasonable expectation of certainty as to the status of a patent.

I turn now to consider the patentee's interests and obligations, noting that, subject to appeal, the consequence to Sanyo of refusal to grant the present request for an extension of time would be irredeemable loss of their residual rights in the patent.

In Kimberly-Clark Ltd v Commissioner and Minnesota Mining and Manufacturing Co 13 IPR 569., Jenkinson J., in considering a request for an extension of time under section 160 of the Patents Act 1952 for lodging notice of opposition, said:

"Section 160(2)(a) confers a power so conditioned that in my opinion its exercise is not lightly to be granted, and a power to be invoked only upon a prompt, frank, comprehensive and clear disclosure of all the circumstances relevant to the weighing of the discretionary considerations upon which grant or refusal of an extension of time will depend."

In considering how much weight I should attach to the private interests of Sanyo in the present matter, I note that although Sanyo initially demonstrated interest in maintaining their rights in the patent following sealing and have more recently demonstrated at least some interest by requesting the extension of time, there is no evidence before me to indicate that there was any such continuing interest in the period from mid-1991 until mid-1993. In fact, from the material supplied in support I conclude that there is a strong presumption that the person who took over responsibility for the conduct of Sanyo's patent affairs (in 1993?) was concerned that Sanyo's rights in the patent be restored but that that person's predecessor had no such concern. This would seem to be the case whether Sanyo knew in mid-1991 that the patent had ceased and took no action, or whether Sanyo at the relevant time did not bother to have in place a renewals monitoring system characterised by a level of adequacy commensurate with a continuing interest in maintaining their rights in the patent. Furthermore, I note that there is little before me to enable me to dismiss the possibility that at some point Sanyo's interest in having its rights in the patent restored may have been motivated by the emergence of commercial factors more favourable to working of the invention than those which had existed previously.

In relation to the delays in requesting extension of time and providing evidence in support and the provision of explanations for those delays, I note that no direct evidence in declaratory form has been provided by the responsible person for Sanyo having as direct as possible knowledge of the relevant facts. I consider that Sanyo's lack of action in this regard, combined with the  apparently leisurely approach of Sanyo in determining the nature of the reasons for the failure for the 4th year renewal to be timely paid, does not militate in their favour. Certainly I would be inclined to attach more weight to Sanyo's interests in this matter if they themselves had demonstrated, by their actions, a higher regard for doing everything within their power to facilitate not only prompt remedy of the consequences of the ceasing of the patent in May 1990 but also a proper evaluation of the reasonableness of their conduct in relation to the present matter.

Consequent upon my findings above, I conclude that the public interest in terms of legitimate expectations of certainty in the patents renewal system, prevail over the patentee's interest in this matter. Accordingly I am not satisfied that I should exercise my discretionary power in favour of the applicant for extension of time.

SUMMARY

Whilst I have found that the reason for the failure for the 4th year renewal fee to be timely paid was because of an error or omission, I believe that in view of the surrounding circumstances I should not exercise the discretionary powers conferred by section 223(2) in favour of the applicant for an extension of time. I refuse to grant the extension of time sought.

Alan Moore
Delegate of the Commissioner of Patents

Patent attorneys for the patentee  :  Davies Collison Cave, Melbourne