SNF (Australia) Pty Ltd v Ciba Speciality Chemicals Water Treatments Ltd (No 4)

In this case, SNF (Australia) Pty Ltd, the applicant, and Ciba Specialty Chemicals Water Treatments Ltd, the respondent, are engaged in a legal dispute over patent infringement and the assessment of damages. The matter has reached the Federal Court of Australia, where Justice Davies is presiding. The central issue in this case is the extent to which SNF is required to provide information and discovery in aid of a hearing to assess the damages caused by SNF's infringement of Ciba's patents, or alternatively, an account of profits in respect of the infringements.

Ciba has sought extensive discovery orders to enable it to assess damages or an account of profits in relation to the patent infringement. SNF has objected to the scope of these orders, arguing that Ciba should only be entitled to information in relation to the three mines where infringement was previously found and that the discovery should be limited to matters directly related to the SNF process. The court considered the principle established in Nokia Corporation v Liu (2009) 179 FCR 422, which holds that the inquiry into damages is not limited to the loss occasioned by the proven infringement but extends to all instances of infringement. However, the court also recognised the limitations set out in Bitech Engineering v Garth Living Pty Ltd (2011) 91 IPR 160, which held that if the patentee's case is precisely pleaded, the patentee is not entitled to make additional claims for infringement through the assessment inquiry.

Justice Davies concluded that Ciba is entitled to pursue SNF in respect of additional instances of infringement relating to the SNF process beyond the three mines in respect of which findings were made. However, the court found that the orders should not extend beyond the SNF process and accordingly, the court decided to limit the scope of the discovery orders. The court also found that the proposed categories of documents sought in Annexure A were objectionable because they were either too wide or their relevance to the assessment inquiry was not apparent. The court allowed Ciba to make a further discovery request in proper form.

The court's decision balances the need for the patentee to be able to assess damages or an account of profits with the patentee's obligation to limit the scope of the discovery orders to matters directly relevant to the infringement. The court's decision also highlights the importance of properly framing discovery orders to avoid oppressive or irrelevant requests.