Sumitomo Electric Industries Ltd v Bicc Plc and Corning Limited

[1993] APO 29

official notice

decision of a delegate of the commissioner of patents

Application        :    No. 617173 in the name of SUMITOMO ELECTRIC INDUSTRIES LTD

Title:    A pressure transporting system for an improved optical fibre

Action:    Opposition to the grant of a patent by BICC PLC and CORNING LIMITED;  request to amend the statement of grounds and particulars

Decision:    Issued            .  Amendment refused.  Both the time between filing the statement of grounds and particulars and requesting amendment, and the time between identifying new particulars and requesting amendment, taken into account.

patents act 1990

decision of a delegate of the commissioner of patents

Re:Patent Application No. 617173 by SUMITOMO ELECTRIC INDUSTRIES LTD, opposition by BICC PLC and CORNING LIMITED, and a request to amend the statement of grounds and particulars

background

Application number 617173 by Sumitomo Electric Industries Ltd was advertised accepted on 21 November 1991.  On 21 February 1992 a notice of opposition to the grant of a patent was lodged by BICC plc and Corning Limited.  The statement of grounds and particulars was served on 23 March 1992 (the 21st being a Saturday).

Evidence in support was due to be served by 23 June 1992.  An extension of time for serving evidence in support until 23 September 1992 was allowed without objection.  On 23 September 1992 four declarations were served, and an extension of a further month requested in order to complete a final declaration.  The delegate of the Commissioner allowed the extension on the following terms:

"The extension of time is granted only for the purpose of serving Dr Clarke's (sic) declaration, and for matters consequential upon that declaration."

On 20 October 1992 the opponents requested leave to amend the statement of grounds and particulars.  Evidence in support was completed on 23 October 1992.

The applicant objected to the amendment, and requested to be heard.  A hearing was conducted by telephone on 17 March 1993.  The applicant was represented by Mr Robert Miller, patent attorney of Spruson & Ferguson, Sydney.  The opponents were represented by Ms Karen Yields, patent attorney of Davies Collison Cave, Melbourne.

the statement of grounds and particulars

The reasons for requesting the amendment of the statement of grounds and particulars were given as:

"We wish to amend the original Statement of Grounds and Particulars so as to include a number of additional particulars.  There additional particulars have only recently become apparent to us and arose incidental to the preparation of Dr Clark's declaration."

The amendment of the statement of grounds and particulars that the opponents are seeking is to insert several pieces of text into the particulars.  I will quote the relevant portions of the statement as proposed to be amended, with the new material shown underlined.

"4.That the invention, so far as claimed in any claim, was obvious and did not involve an inventive step, having regard to what was known or used in Australia on or before the priority date of that claim;

Particulars of ground 4 are as follows:-  ...

iv)The use of polytetrafluorethylene (commonly known as teflon), which is the fluorine resin based solid described in AU 34881/89 (617173), as a friction reducing means as claimed in claims 2 to 11, 13 to 16, 34 and 43 of AU 34881/89 (617173) was well known and was common general knowledge in Australia before the priority date.  Attention is drawing (sic) to definitions in The Macquarie Dictionary, The Oxford Encyclopedic English Dictionary and The Collins English Dictionary (Australian Edition).

v)The lubricants claimed in claims 16 to 28 and 30 to 33 were well known lubricants in Australia before the priority date of the claims and thus claims directed to such lubricants were not novel and/or obvious or lacking in inventive step at the priority date of those claims.  In this regard, attention is drawn to page 6-200 of Mark's Standard Handbook for Mechanical Engineers (Eighth Edition) 1978.

vi)The invention was obvious and did not involve an inventive step in the light of the following publications. ...

vii)'The Blown Fibre Cable' by Stephen Hornung, Stephen A. Cassidy, Peter Yennadhiou and Michael H. Reeve - 1986 August Edition of the Institute of Electrical and Electronic Engineers Journal on Selected Areas in Communication.

viii)Cable and Conduit Placement Handbook - Telecom Australia 1974.

ix)The Macquarie Dictionary.

x)The Oxford Encyclopedic English Dictionary.

xi)The Collins English Dictionary (Australian Edition).

5.That the invention, so far as claimed in any claim, was, before the priority date of that claim, otherwise not novel in Australia;

Particulars of ground 5 are as follows:- ...

iv)The use of polytetrafluorethylene (commonly known as teflon), which is the fluorine resin based solid described in AU 34881/89 (617173), as a friction reducing means as claimed in claims 2 to 11, 13 to 16, 34 and 43 of AU 34881/89 (617173) was well known and was common general knowledge in Australia before the priority date.  Attention is drawing (sic) to definitions in The Macquarie Dictionary, The Oxford Encyclopedic English Dictionary and The Collins English Dictionary (Australian Edition).

v)The lubricants claimed in claims 16 to 28 and 30 to 33 were well known lubricants in Australia before the priority date of the claims and thus claims directed to such lubricants were not novel and/or obvious or lacking in inventive step at the priority date of those claims.  In this regard, attention is drawn to page 6-200 of Mark's Standard Handbook for Mechanical Engineers (Eighth Edition) 1978.

vi)The invention was obvious and did not involve an inventive step in the light of the following publications. ...

vii)'The Blown Fibre Cable' by Stephen Hornung, Stephen A. Cassidy, Peter Yennadhiou and Michael H. Reeve - 1986 August Edition of the Institute of Electrical and Electronic Engineers Journal on Selected Areas in Communication.

viii)Cable and Conduit Placement Handbook - Telecom Australia 1974.

ix)The Macquarie Dictionary.

x)The Oxford Encyclopedic English Dictionary.

xi)The Collins English Dictionary (Australian Edition).

submissions

Both parties filed written submissions with the Patent Office prior to the hearing.  A letter from the patent attorneys for the opponents dated 29 January 1993 states in part:

"At paragraphs 4 vi)(vii) and 5 vi)(vii) of the amended statement of grounds and particulars a reference entitled "The blown fibre cable" has been introduced.  This reference is also referred to at paragraph 3 of the statutory declaration by Dr Clark.  The reference "The blown fibre cable" has substantially the same disclosure as the paper entitled "A radically new approach to the installation of optical fibre using the viscous flow of air" which was reported in the Proceedings of the 32nd International Wire and Cable Symposium, November 15-16-17, 1983 and which was particularised in the statement of grounds and particulars as originally filed.  Two of the authors of the reference "The blown fibre cable" were also authors of the paper entitled "A radically new approach to the installation of optical fibre using the viscous flow of air".  The similarity between the disclosures of the two references is such that the inclusion of the additional reference would not substantially change the case the applicant has to answer in the opposition. ...

The amendment to include the paper "The blown fibre cable" in the statement of grounds and particulars was filed at the earliest reasonable opportunity.  The amendment was lodged as a consequence of receiving a facsimile on 13 October, 1992 from Dr Clark to indicate that the statements made at paragraph 3 of his draft statutory declaration were supported by the wide distribution and knowledge of the paper entitled "The blown fibre cable".  Dr Clark had not previously had an opportunity to review his draft statutory declaration because he had been overseas between the period 12 September 1992 and 1 October 1992.

On 14 October, 1992 the undersigned obtained a full copy of the paper and performed a review of such.  After reviewing the reference and considering Dr Clark's draft statutory declaration we filed an amendment on 20 October, 1992 to include the paper "The blown fibre cable" in the statement of grounds and particulars. ...

The amendments proposed to the statement of grounds and particulars also serve to introduce reference to the "Cable and Conduit Placement Handbook" as a particular at paragraphs 4 vi)(viii) and 5 vi)(viii).  The introduction of this particular arose consequential to Dr Clark's advice of 13 October, 1992 that paragraph 4 of his statutory declaration was supported by the disclosure of the "Cable and Conduit Placement Handbook" which was published in 1974 and widely distributed to all Telecom Australia installation personnel.  The addition of this particular into the statement of grounds and particulars arose incidental to the preparation of the case. ...

Finally, the amendments made to the statement of grounds and particulars serve to incorporate a reference to Marks Standard Handbook for Mechanical Engineers is made at paragraphs 4 v) and paragraph 5 v).  Marks Standard Handbook for Mechanical Engineers is a well known and standard text book for mechanical engineers.  We do not consider that the introduction of such a standard text book as a particular in the statement of grounds and particulars would unduly prejudice the applicant."

A letter from the patent attorneys for the applicant dated 3 February 1993 states in part:

"The applicant objects to the following particulars, as sought to be incorporated in the Statement:

Particulars 4 v) and 4 vi)(vii) - (viii), and Particulars 5 v) and vi)(vii) - (viii).

Furthermore, the applicant wishes to make the following submissions in view of the submissions filed by the attorneys for the opponents dated 29 January 1993.

We submit that the amendment should not be allowed in view of r.5.9(2)(e), in that the applicant would be unduly prejudiced by the amendment. ...

1. The amendments are detrimental or disadvantageous

It is submitted the amendments sought are detrimental or disadvantageous, in that they substantially change the case to be answered.

The effect of proposed amended particulars Nos. 4 v), vi)(vii) - (viii), and 5 v), vi)(vii) - (viii) are to seek to add new particulars.  The new particulars relate to the grounds of obviousness and lack of novelty, and, if the particulars were incorporated, would mean that the case to be answered by the applicant would substantially change, as each new particular would need to be addressed either on its own or in combination with the particulars already filed.  It is submitted that the addition of new particulars is, prima facie, detrimental or disadvantageous to the applicant.

2. Circumstances surrounding the amendment sought

(a) Timeliness of the amendment sought

... It is submitted the time delay of seven months in which to request the amendments to the Statement is excessive in the circumstances.  In effect, the opponent would have the benefit of an eight month period in which to file the Statement of Grounds and Particulars upon which it plans to rely in these proceedings.

(b) Other circumstances

It is further submitted that the particulars sought to be included in the Statement did not arise incidental to the preparation of the case. ...

It is our submission that the circumstances indicate the new particulars were, in a sense, actively sought, in that they originated from Dr Clark who was, at the time, obliged to restrict himself to finalising the draft Statutory Declaration at hand.  Extra time had already been made available by the Delegate of the Commissioner of Patents to complete the evidence as it stood at that time, and it is submitted that in seeking to incorporate the new particulars, the opponents are seeking to make a "better" or "broader" basis for the opposition."

At the hearing, Mr Miller confirmed that the applicant only objected to the inclusion of particulars relating to the Blown Fibre Cable article, the Cable and Conduit Placement Handbook and Mark's Standard Handbook (i.e. particulars 4 v), 4 vi)(vii), 4 vi)(viii), 5 v), 5 vi)(vii), 5 vi)(viii)).

Ms Yields' oral submissions on behalf of the opponents can be summarised as follows:

.On 13 October 1992 Dr Clark provided support for some of the statements in his draft declaration in the form of additional references.  Copies of these references were obtained on 14 October 1992, and amendment of the statement of grounds and particulars was requested on 20 October 1992.

.The test to be considered is whether the amendment is detrimental or disadvantageous, and whether the circumstances cause the degree of that detriment to be excessive (Diamond Scientific Company v CSL Limited (1992) AIPC 90-927). Expanding the particulars does not automatically cause detriment to the applicant (The Boots Company PLC v Hamilton Laboratories Pty Ltd, Patent Office decision, 21 December 1992, patent application number 614998, unreported).

.The particulars relating to all three documents arose incidental to the preparation of Dr Clark's declaration.  Dr Clark was not seeking new material.  This was information that Dr Clark was already aware of, and was simply provided to support his assertions.

.There would be no protraction of the case as the evidence in support was completed within the time already allowed by the delegate, and the request to amend the statement was filed within seven days of becoming aware of the documents.

.Dr Clark was not limited in the evidence he could give.  The delegate's direction allowing the extension of time to serve evidence in support imposed no limits on Dr Clark.  The amendment of the statement in the light of Dr Clark's declaration was within the delegate's direction because it was consequential upon that declaration.

Mr Miller's oral submissions on behalf of the patent applicant can be summarised as follows:

.New particulars are prima facie disadvantageous (Diamond Scientific v CSL, supra, and Boots v Hamilton, supra), and will result in real detriment because the applicant's experts would have to consider the extra particulars, which would increase costs for the applicant.

.It has not been explained why the draft of Dr Clark's declaration was not available earlier.  The underlying principle governing the statement of grounds and particulars is that it is designed to inform the applicant of the case it has to answer (Kent-Moore Corporation v Environmental Products Amalgamated Pty Ltd (1992) AIPC 90-915). Thus, the total delay from filing the statement to requesting amendment should be considered.

.The Diamond Scientific decision refers to matters "incidental" (page 38,699) and also to matters "consequential" (page 38,702), so it appears that either will suffice.  The proper test is to distinguish between information actively pursued or looked for, and information stumbled over.  In the present case there is insufficient evidence that the new references were stumbled over.

decision

A preliminary issue is what evidence I can rely on in reaching my decision.  Mr Miller argued that submissions that were first raised at the hearing were not admissible because they were not in declaratory form and thus more akin to hearsay, and no notice of them was given prior to the hearing. 

In this matter, the Commissioner is acting as a tribunal.  Consequently, the Commissioner "is master of its own procedure, provided that the rules of natural justice are applied ... Tribunals are entitled to act on any material which is logically probative, even though it would not be evidence in a court of law" (Lord Denning MR in T.A.Miller Ltd v The Minister for Housing and Local Government and Another (1968) 1 WLR 992 at 995). The material objected to by Mr Miller is logically probative, so I consider it admissible. However, I believe that there is an issue of natural justice which I must consider. The applicant would be denied natural justice if it did not have an adequate opportunity to respond to the matters raised by the opponents at the hearing. Mr Miller stated that he would not respond to those matters, and did not request further time to respond to any of the matters. In these circumstances, the patent applicant has had the opportunity to respond. The common law does not impose on me a duty to ensure that the applicant makes the best of their opportunity (Sullivan v Department of Transport (1978) 20 ALR 323 at 343 per Deane J). I think that natural justice has not been denied, and I can take account of all submissions.

The allowability of amendments to the statement of grounds and particulars is determined by regulation 5.9.  This regulation was considered in Diamond Scientific v CSL, supra.  From that decision I conclude that:

i)while the onus of demonstrating that the amendment is not allowable is initially on the patent applicant, once the applicant objects and there is prima facie undue prejudice, the party requesting the amendment must make out an appropriate case for the amendment; and

ii)an amendment is not allowable if:

a)the amendment is detrimental or disadvantageous to a person, and

b)the circumstances surrounding the amendment cause the degree of that detriment or disadvantage to be unwarranted, excessive, improper, inappropriate, or unjustified.

As a consequence of point i), in matters that come on for hearing before the Commissioner the onus will normally be upon the party requesting the amendment.

In the small number of decisions issued by the Commissioner to date, the issue of detriment or disadvantage has generally been straight forward.  The decisions have instead turned on whether the circumstances amounted to an excessive detriment.  Factors that indicate that the detriment is excessive are:

a)delay in seeking a relevant amendment (Diamond Scientific v CSL, supra);

b)the amendment would cause the particulars to become inadequate for their purpose (Boots v Hamilton, supra); or

c)the opponent was actively seeking further particulars for its opposition (Diamond Scientific v CSL, supra).

Factors that indicate that the detriment is not excessive are:

d)the extra particulars arose incidental to the preparation of the case, do not result in any protraction of the case, are included by way of amendment at the earliest reasonable opportunity, and do not substantially change the case (as against the specific facts) to be answered (Diamond Scientific v CSL, supra, and Abundant Lawn Grass Industries Pty Limited v Mobile Grass Planting Machinery, Patent Office decision, 3 March 1993, patent application number 619419, unreported); or

e)the amendment merely clarifies a particular that was already present (Boots v Hamilton, supra), or corrects an obvious mistake (Diamond Scientific v CSL, supra).

In the present case, objection was only taken to the particulars relating to three documents, so I will accept that the other changes are allowable. 

The amendment to include the Cable and Conduit Placement Handbook is a simple case of adding a new citation.  The addition of a new material fact is prima facie prejudicial.

The amendment to include the Blown Fibre Cable article also adds a new material fact.  Ms Yields stated that the inclusion of this article is not detrimental because it is substantially the same disclosure as in another article already included in the particulars.  It would not be proper to carry out a detailed analysis of the evidence in determining a procedural matter.  However, from a brief examination of the articles I can see that:

.the two authors of the earlier article are the same as two of the authors of the Blown Fibre Cable;

.the Blown Fibre Cable article is dated two years after the earlier article, and refers to that article;

.many of the figures in the Blown Fibre Cable article are identical with those appearing in the earlier article; and

.the Blown Fibre Cable is more detailed, and reports work not included in the earlier article.

The two articles are clearly related.  However, the later article is not simply a repeat of the earlier.  There is a prima facie change in the case to be answered.

The amendment to include Mark's Standard Handbook seems to me to be quite a different situation.  The Blown Fibre Cable and the Cable and Conduit Placement Handbook are introduced as material facts, whereas Mark's Standard Handbook is introduced as an example of evidence that a matter is common general knowledge (as it is only "attention is drawn" to Mark's Standard Handbook).  Although it is accepted that particulars should not include evidence (Mobay Corporation v The Dow Chemical Company 24 IPR 379, see page 390), the question I have to decide is whether the introduction of these matters of evidence would unduly prejudice the patent applicant. The evidence does not change the case to be answered, but I believe it is prejudicial. The proposed amendment appears to limit the evidence of the common general knowledge to Mark's Standard Handbook. However, the wording of the particular is such that the opponents are not restricted to Mark's Standard Handbook as evidence of the common general knowledge, and could choose not to rely on Mark's Standard Handbook at all. As a consequence, it distracts from the real case to be answered. Not only is this prejudicial, but it is unjustifiable.

The next question is the degree of detriment associated with the other two amendments.  This raises points a) and d) of the above analysis: delay, and incidental particulars.

Delay in seeking amendment

It is clear from the Diamond Scientific decision that the delay between filing the statement and requesting amendment must be taken into account.  This is separate from, and in addition to, the time between identifying incidental particulars and requesting amendment.  The total delay from filing the statement to requesting amendment will always be relevant (though may have to be weighed against other factors).

In the present case the total delay was seven months.  The reasons for this delay were that the documents were only identified when Dr Clark's declaration was nearing completion.  However, it is not apparent why Dr Clark's declaration was not prepared earlier.  The reasons given for the first extension of time to serve evidence in support included the following statement:

"We have been reviewing the prior art references so as to prepare an outline of our position which will be used to prepare one or more statutory declarations for execution by our expert. ... Further time is respectfully sought to complete the review of the original prior art references and the new prior art reference, to prepare the necessary declarations and to have the declarations executed by our expert."

It appears from this information that Dr Clark was not involved in the preparation of his evidence until a draft was presented to him.  The draft was couriered to Dr Clark on 8 September 1992 (according to a statutory declaration of Ms Yields on file in connection with the second extension of time to serve evidence in support).  There remains a delay of five and a half months between filing the statement of grounds and particulars and the preparation of a draft declaration for the expert witness.

Incidental particulars

Mr Miller argued that the Diamond Scientific decision refers to both incidental and consequential particulars.  This is true.  In discussing the general principles that apply the hearing officer refers to "incidental to" on two occasions in connection with new particulars (page 38,699).  When applying the principles to the facts of the case the hearing officer used the expression "consequential upon" on three occasions (page 38,702).  The Macquarie Dictionary defines incidental as "1. happening or likely to happen in fortuitous or subordinate conjunction with something else. 2. liable to happen or naturally appertaining (fol. by to)." and consequential as "1. of the nature of a consequence; following as an effect or result, or as a logical conclusion or inference; consequent; resultant.".  I think that no significance can be attached to the use of the different terms.  I note that the term incidental has been adopted in the Boots and Abundant Lawn decisions, and for consistency that term should be preferred.

An argument was advanced that because of the direction of the delegate that "The extension of time is granted only for the purpose of serving Dr Clarke's (sic) declaration, and for matters consequential upon that declaration" the particulars are not incidental since "the new particulars were, in a sense, actively sought, in that they originated from Dr Clark who was, at the time, obliged to restrict himself to finalising the draft Statutory Declaration at hand".  I do not think this is correct.  The direction of the delegate limited the evidence to be served, but not the matters that could be addressed by Dr Clark.  Consequently, the fact that these documents were not part of Dr Clark's draft declaration at the time that the delegate gave the direction does not of itself deprive them of incidental character.

A convenient description of particulars that arise incidentally is given in the Abundant Lawn decision, supra at page 6:  "The opponent's pursuit of this chain of events would have been a normal and expected part of the preparation of the evidence in support of the opposition".  I am satisfied that the documents in dispute came to notice as a normal part of the finalisation of Dr Clark's declaration, and were not the result of actively seeking further particulars.  It appears that these particulars will not result in the protraction of the case as evidence in support was completed within the time allowed by the delegate.  It is clear that the new particulars were inserted promptly once they were brought to notice by Dr Clark.  While these particulars change the specific facts of the case, I do not think they substantially change the case to be answered.

Balance of factors

I must weigh the total delay of seven months against the incidental nature of the new particulars.  The reasons for the seven month delay are critical in deciding whether incidental particulars can be included. 

As I have discussed above, there is a period of five and a half months before Dr Clark was given a draft of his declaration.  I have no information on which to base a decision as to whether this delay was reasonable.  The opponents have not explained why there was a period of five and a half months before Dr Clark was given a draft of his declaration.  Given that the onus is upon the opponents, the failure to explain this delay is fatal to their case.  I am not satisfied that the amendment would not unduly prejudice the patent applicant.  I will not allow the amendment.

Alternative analyses

An argument was advanced that since the delegate's direction included the phrase "and for matters consequential upon that declaration", this included authorisation to consequentially amend the statement.  I do not agree that this is a correct interpretation of the direction.  However, even if it were a correct interpretation, the delegate does not have the power to give such an authorisation.  Directions cannot be inconsistent with the Act or Regulations (regulation 5.10(1)(a)).  If the direction was circumventing the requirements laid down in regulation 5.9 so as to allow an amendment which was unduly prejudicial, it would, to that extent, be inconsistent with the Regulations.  Consequently, the delegate's direction per se does not provide a basis for allowing the amendment.

In the case of Mark's Standard Handbook, it was argued that because it is "a well known and standard text book for mechanical engineers" its inclusion would not prejudice the applicant.  As I believe that this is a piece of evidence, this argument is irrelevant.  However, if I am wrong, and Mark's Standard Handbook is a fact, there would be a conflict with the general principle that "the applicant has the right to know, at the time the statement of grounds and particulars is filed, the complete case that it has to answer" (Diamond Scientific v CSL, supra at 38,698) because it is implied that certain things do not need to be included in the statement.  I cannot agree with this proposition.  If it was established that the patent applicant was aware of a specific reference as relevant to the validity of a subsequent patent, this would be a more convincing argument.

conclusion

The amendment in respect of the three documents the Blown Fibre Cable article, the Cable and Conduit Placement Handbook and Mark's Standard Handbook (i.e. particulars 4 v), 4 vi)(vii), 4 vi)(viii), 5 v), 5 vi)(vii), 5 vi)(viii)) is not allowable.  I therefore refuse to allow the amendment.

costs

In actions before the Commissioner costs normally follow the event.  I see no circumstances that would justify me varying this practice in the present case.  I award costs against the opponents.

S.D.BARKER
Delegate of the Commissioner of Patents

Patent attorneys for the applicant  :  Spruson & Ferguson, Sydney

Patent attorneys for the opponents  :  Davies Collison Cave, Melbourne