Superior Modular Products Incorporated v Krone Aktiengesellschaft

[1997] APO 23

official notice

decision of a delegate of the commissioner of patents

Application  :          No. 666932 in the name of SUPERIOR MODULAR PRODUCTS INCORPORATED.

Title:          LOW CROSS TALK ELECTRICAL CONNECTOR SYSTEM.

Action:          Request, by KRONE AKTIENGESELLSCHAFT, to amend the statement of grounds and particulars under regulation 5.9; and objection to the request by SUPERIOR MODULAR PRODUCTS INCORPORATED.

Decision:          Issued  .

Abstract:          The opponent sought to amend the statement of grounds and particulars to replace an incorrectly cited particular with the correct one in respect to the grounds of prior publication and lack of novelty.  Under these grounds the opponent cited about fifty particulars in the original statement.

This decision holds that there has been no active pursuit of particulars as the particular in question was known to the opponent before the opponent filed the statement of grounds and particulars.  There would be no protraction in the preparation of the case as a result of the amendment.  The amendment was also sought at the earliest reasonable opportunity.  Furthermore there is nothing to suggest that the applicant faces a substantial change of case to answer.

In light of the above the applicant would not suffer undue prejudice.  The amendment to the statement of grounds and particulars was allowed. 

patents act 1990

decision of a delegate of the commissioner of patents

Re:Patent Application No. 666932 by SUPERIOR MODULAR PRODUCTS INCORPORATED, and opposition thereto by KRONE AKTIENGESELLSCHAFT; and objection by SUPERIOR MODULAR PRODUCTS INCORPORATED to amendment under regulation 5.9 of a statement of grounds and particulars.

background

Patent application 666932 was advertised accepted on 29th February 1996.  Krone Aktiengesellschaft (Krone) filed a notice of opposition on 20th May 1996.  The company subsequently filed a statement of grounds and particulars on 20th August 1996.  Following the grant of an extension of time Krone served evidence-in-support on 20th December 1996.  On the same date Krone also requested amendment of the statement of grounds and particulars.  Superior Modular Products Incorporated (Superior Modular Products) objected to the request and a hearing took place on 5th May 1997.  Mr Tony Mizzi of Griffith Hack, represented Superior Modular Products.  Mr Keith Leslie, with Mr Chris Mitchell, of Davies Collison Cave, represented Krone.  Both parties appeared by telephone.

The amendment proposes to replace a particular (paragraph 1.1(xxxix)) under the grounds of prior publication and lack of novelty of the invention (section 18(1)(b)(i)).  The amendment is to delete the reference and commentary to a US patent and replace it with a reference to Australian patent application 651028 (32960/93) and associated commentary.  Krone states the reason for requesting this change is that the US patent “is in fact the US counterpart to the present Australian patent application under opposition, and was erroneously cited in the statement of grounds and particulars instead of Australian patent application no. 651028”.  Krone also mentions the error seems to have arisen through confusion from patent application 651028 also being opposed by Krone, and that the error came to light during preparation of the evidence-in-support. 

APPLICABLE LAW

Regulation 5.9 provides for amendment of a statement of grounds and particulars.  The pertinent point is regulation 5.9(2)(e).  Under this regulation I cannot allow amendment of the statement if I reasonably believe a person would be unduly prejudiced by the amendment.  At the hearing and in their written submissions, both parties referred to the Diamond Scientific Company v CSL Limited decision ((1992) AIPC 90-927) in discussing whether the proposed amendment would cause undue prejudice. According to that decision I need to determine whether Krone undertook active pursuit of further particulars in the opposition, or whether the extra particular arose incidentally to the preparation of Krone’s case. If I find the latter is the case then the Diamond Scientific (supra) decision suggests that I should also consider whether:-

• the extra particulars would result in any protraction in the preparation of the case;

• the amendment was sought at the earliest reasonable opportunity; and

• the extra particulars would substantially change the case the applicant has to answer.

While the Diamond Scientific (supra) decision specifically refers to just the two alternatives of active pursuit or incidental arising of particulars, I will take the above dot-points into consideration if I find that Krone has not undertaken active pursuit of further particulars, irrespective of whether they arose incidentally or otherwise.  This course of action is appropriate since the important point from the Diamond Scientific (supra) case is that new material is not to be included if that material arose from the opponent carrying out further searches.

DECISION

The proposed amendment to the statement of grounds and particulars is to replace one erroneously inserted particular with the correct one.  The statutory declaration of 21st March 1997 by Mr Keith Leslie states he was fully aware of the existence and relevance of Australian patent application 32960/93 (the correct particular) at the time of preparing the statement of grounds and particulars.  Mr Leslie also states he intended to include reference to this application in the statement of grounds and particulars. 

Whether there has been active pursuit of further particulars.

From the statements in the declaration it is clear that Mr Leslie knew of application 32960/93 and of its relevance to the opposition before serving the statement of grounds and particulars on Superior Modular Products.  This suggests that this particular did not arise incidentally to the preparation of the case but was already known during such preparation.  Likewise there is no evidence of active pursuit of particulars to further enhance Krone’s case after serving the statement of grounds and particulars.  Mr Leslie knew of the particular before serving the statement of grounds and particulars and had intended to include the particular in that statement.  The omission of the particular from the original statement of grounds and particulars has arisen from the incorrect quotation of another particular.  I conclude that there has been no active pursuit of further particulars by Krone.

I now turn to consider the three dot-points mentioned above.

Whether there would be protraction in the preparation of the case.

The request to amend seeks the replacement of one particular with another, more specifically one patent document with another.  There are approximately fifty particulars listed in the statement under the grounds of prior publication and lack of novelty. 

Mr Leslie cited The Lubrizol Corporation v Exxon Chemical Company case (unreported decision on application 661038, dated 18th November 1996) to highlight that a protraction of proceedings is considered distinct from a protraction in the preparation of a case.  In the present case a protraction in proceedings will naturally occur as both parties seek the resolution of this request to amend.  Concerning protraction in the preparation of the case I agree with Mr Leslie.  I do not think a protraction in the preparation of this case exists as a result of the replacement of one individual particular with another when there are approximately fifty other particulars to be considered by the applicant in preparing their evidence-in-answer.

In fact the replacement of the particular may reduce the possibility of protraction.  Superior Modular Products may be able to better establish the case to answer through the correct particular rather than having to deal with the confusion surrounding a particular which cites the US counterpart to the present Australian patent application.

Mr Leslie also noted the request to amend was filed simultaneously with the evidence in support.  This is similar to the situation in the Abundant Lawn Grass Industries Pty Ltd v Crancove Pty Ltd decision ((1993) AIPC 90-973). In that case the hearing officer decided there was no protraction in preparing the case. The concurrent filing of the request to amend the statement of grounds and particulars and the serving of evidence-in-support enabled the applicant to consider the new particular at the same time as the rest of the evidence-in-support. I adopt the same view in the present case. I do not think there is a protraction in the preparation of the case.

Whether the amendment was sought at the earliest reasonable opportunity.

Mr Mizzi in his written submissions asserts that the very latest the opponent was aware of the document in question was as early as October 1994, well before the filing of the notice of opposition, and the statement of grounds and particulars.  He asserts that a possible delay of two years has occurred between Krone’s awareness of the document and the request to amend.  In any case Mr Mizzi asserts there has been a delay of at least four months.  This delay is measured from 20 August 1996 when the statement of grounds and particulars was filed to 20 December 1996 when the request to amend was filed.  Mr Mizzi submits thereby that the amendment was not sought at the earliest reasonable opportunity.

Mr Mizzi has not provided any evidence to substantiate the opponent’s awareness of the document as early as October 1994.  That aside, the issue to be determined is not when the opponent first knew of the document, but when the opponent first identified an error in the statement and how soon thereafter it was acted upon.

Mr Leslie in his statutory declaration states the error in the statement of grounds and particulars was noticed “shortly” before 20 November 1996 during final preparation of the evidence in support.  The request to amend the statement of grounds and particulars was filed with the evidence in support on 20 December 1996, a delay of just over one month.  Mr Mizzi noted that the term “shortly” is indefinite and imprecise.  However he accepted Mr Leslie’s contention that the period was in fact of the order of a couple of days.  Mr Leslie then submitted that a delay of about one month is not undue and cited the Caterpillar Inc v Kozo Miyake case (unreported decision on application 651768 dated 14th December 1995) to support this position.  I accept that a period of about one month between discovery of the error and filing of the request to amend is not an unreasonable delay.

I conclude that Krone sought to amend at the earliest reasonable opportunity.

Whether there is a substantial change of case for the applicant to answer.

Mr Mizzi submitted it is a requirement of the statement of grounds and particulars to fully advise the applicant of the complete case it has to answer.  He further asserts that the statement sets the boundary of the case but the actual or real case to be answered is determined by the evidence-in-support.

Mr Mizzi also contended there would be a substantial change of case for the applicant to answer if I allowed the amendment.  He suggested the only document relied upon in Krone’s evidence-in-support for the ground of lack of novelty is the new particular in question (application 651028).  Mr Mizzi submitted that without the new particular the applicant would have no case to answer in respect to the grounds of novelty.  According to Mr Mizzi this meant there would be a substantially new case for the applicant to answer.

In response Mr Leslie submitted that the applicant’s perception of there being a change of case is misconceived.  He suggested the role of the statement of grounds and particulars is to give an outline of the case to be answered, the evidence-in-support is to provide supporting factual material, and the complete case is to be put at the substantive hearing.

I think the statement of grounds and particulars is sufficient if it presents to the applicant an outline of the case to be met and describes the issues which the opponent will raise in the opposition.  In the present case I think Krone’s statement achieves this end.

Turning to Mr Mizzi’s concerns regarding the ground of lack of novelty, I note that the original statement of grounds and particulars, at pages 1 and 10, gives the following grounds (amongst others) :-

“1.  That the invention, so far as claimed in any claim, is not patentable because it is prior published or is otherwise prior disclosed or prior used so as not to satisfy Section 18(1)(b)(i) of the Act.”

Item 1.1 lists fifty-two particulars to support this ground.

“2.  That the invention, so far as claimed in any claim, is not novel and is not patentable because it does not satisfy Section 18(1)(b)(i) of the Act.”

This ground is supported by the following particulars at page 11:

“2.1  The prior art cited in item 1.1 above”.

Clearly the statement of grounds and particulars relies on lack of novelty to “set a boundary” for this case.  The opponent has clearly identified lack of novelty as a ground for opposition.  Consequently I cannot agree with Mr Mizzi’s submission that Superior Modular Products have a new case to answer under the ground of lack of novelty.

I queried Mr Mizzi on the basis for his assertion that the particular document in question is the only one relied upon in the evidence-in-support to support the ground of lack of novelty.  He again asserted that the evidence-in-support does not contain any document against this ground except the new particular. 

While the statement of grounds and particulars is the primary document for establishing the grounds of opposition and the case to be answered, I have perused the evidence-in-support to the extent necessary to establish the merit of Mr Mizzi’s assertions.  I have not examined the evidence to see what comment the declarants make in respect to the particulars under the ground of lack of novelty.  However I note that many of the original particulars are included in the evidence-in-support as exhibits in full.  I am satisfied that the grounds of lack of novelty are adequately supported in the original statement of grounds and particulars and the evidence-in-support. 

To determine whether there is a change of case I also need to consider the effect of introducing the new particular in question in place of the incorrect one.  There is a wealth of case law holding that there is no change of case for far more significant amendments than the amendment sought in the present case.  This case law is in respect to, not only substitution of a particular but also to, the addition of extra particulars into the statement of grounds and particulars.  Some examples are ARX Pty Limited v Lockwood Australia Pty Ltd (33 IPR 308), Abundant Lawn Grass Industries (supra), and Lubrizol (supra).  A particularly good example is the Caterpillar (supra) decision which allowed one request to add an extra particular over the original six but refused a further request to add another three particulars.

In the light of these examples I must accept that changing one particular out of a total of about fifty particulars does not substantially change the case for the applicant to answer.

Whether the error allows undue prejudice.

The conclusions in all the above sub-headings are in Krone’s favour.  From the Diamond Scientific (supra) decision this means that Superior Modular Products would not be unduly prejudiced by the amendment.  I think though that the nature of the error warrants some further comment. 

Mr Mizzi submitted that regulation 5.9(2)(e) is not qualified to allow undue prejudice arising from correcting a clerical error.  He suggested that, clearly, undue prejudice can arise from the correction of a clerical error and contrasted the present circumstances with the Hoffmann La Roche v Bresatec case (unreported decision on application 632857, dated 10th June 1994).  In that case the amendment proposed to correct typographical errors.  That case cited the Diamond Scientific (supra) case to say that if an amendment can be categorised as correcting an obvious mistake then no person can be unduly prejudiced by that amendment.

In the present case the error is more significant than the correction of an obvious mistake, particularly one of the nature of a typographical error.  The present mistake or error is not obvious from the statement of grounds and particulars.  It is only from examining the original particularised document in question that the error may become evident.  From the above two cases this may suggest undue prejudice.  Nonetheless the primary consideration is whether the amendment would cause undue prejudice in the overall context of the statement of grounds and particulars.  The nature or extent of the error is immaterial to that determination, in this case, since the error is merely a reason for amending, not an effect of the amendment.

Consequently the conclusion stands that Superior Modular Products would not be unduly prejudiced by the amendment.

CONCLUSION

I have found that Krone has not undertaken active pursuit of particulars.  The particular in question was known to Krone before Krone filed the statement of grounds and particulars.  There would be no protraction in the preparation of the case as a result of the amendment.  The amendment was also sought at the earliest reasonable opportunity.  Furthermore there is nothing to suggest that Superior Modular Products faces a substantial change of case to answer.

In light of the above Superior Modular Products would not suffer undue prejudice.  I allow the amendment to the statement of grounds and particulars.

According to normal practice involving hearings on statements of grounds and particulars I direct that the time for serving the next stage of evidence, the evidence-in-answer in this case, expires three (3) months from the date of this decision.

COSTS

Both parties submitted that costs should follow the event.  Superior Modular Products has been unsuccessful in this case.  I award costs against Superior Modular Products Incorporated.

M.G. Kraefft
Delegate of the Commissioner of Patents

Patent attorneys for the applicant   :  Griffith Hack, Melbourne

Patent attorneys for the opponent   :  Davies Collison Cave, Melbourne