Viskase Corporation v W.R. Grace & Co.-Conn

[1995] APO 67

official notice

decision of a delegate of the commissioner of patents

Application        :    No. 606573 in the name of VISKASE CORPORATION

Title:    IRRADIATED MULTILAYER FILM FOR PRIMAL MEAT PACKAGING

Action:    Opposition to the grant of a patent by W.R. GRACE & CO.-CONN; Request by Viskase Corporation for special leave to lodge further evidence; Application for extension of time by W.R. Grace & Co.-Conn to file evidence in reply.

Decision:    Issued            .

Abstract:    Further Evidence

The evidence sought to be adduced as further evidence was directed entirely at material that was filed as evidence in support.  There was nothing in the further evidence that the applicant could not have ascertained based on the evidence in support.  Application for special leave to adduce further evidence refused.

Extension of Time to File Evidence in Reply

The opponent has not given sufficient reasons to justify an extension.  The fact that a new US attorney has assumed responsibility of the case does not justify an extension when his predecessor had several opportunities to review the evidence.   An extension of 10 days from the date of this decision to file any evidence which the opponent has already prepared allowed.

patents act 1990

decision of a delegate of the commissioner of patents

Re:Patent Application No. 606573 by Viskase Corporation and opposition thereto by W.R. Grace & Co.-Conn; a request by Viskase Corporation for special leave to lodge further evidence; an application by W.R. Grace & Co.-Conn for an extension of time to file evidence in reply.

background

Patent Application No 606573 by Viskase Corporation (Viskase) was advertised accepted on 14 February 1991.  W.R. Grace & Co.-Conn (Grace) filed a notice of opposition to the grant of the patent on 14 May 1991.

Grace served its evidence in support on 14 September 1992.  After unopposed extensions of time to file evidence in answer to 14 March 1994, Viskase applied for a further extension from 14 March 1994 to 14 June 1994.  Grace objected to this extension.  In a decision of a delegate of the Commissioner dated 15 July 1994, the delegate found that the applicant had not justified the extension of time sought.  The delegate allowed the applicant ten days from the date of the decision to serve any evidence that the applicant had already prepared.  Viskase filed a statutory declaration on 8 July 1994, and stated that the declaration formed part of the evidence in answer.  Viskase served no more evidence in the time allowed by the delegate.  The delegate directed that the period for serving evidence in reply commenced on 25 July 1994.

Grace have been granted a number of unopposed extensions of time to serve evidence in reply up to 25 July 1995, and served part of their evidence in reply on 25 January 1995.  Viskase objected to a further request by Grace for an extension of time from 25 July to 25 August 1995.

Viskase filed an application for special leave to lodge further evidence on 13 July 1995.  A declaration by Richard Hiram Baddeley complying with sub-section 59(3) of the 1952 Patents Act accompanied the application.  Evidence in the form of a statutory declaration by Stanley Lustig was also filed with the application.  Grace objected to the application for special leave.

A hearing was held in Canberra on 29 August 1995 to consider the application for special leave by Viskase and the request for an extension of time by Grace.  Richard Baddeley, patent attorney of Watermark, Perth, represented Viskase.  Michael Angliss, patent attorney of Davies Collison Cave, Melbourne, represented Grace.

request for special leave

Application number 606573 was advertised accepted prior to the commencement of the Patents Act 1991.  Therefore the 1952 Act and regulations apply.

At the hearing both parties referred to the criteria considered by the delegate of the commissioner in Micronair (Aerial) Ltd v Waikerie Co-op Producers Ltd 7 IPR 107. The delegate considered the following three matters in deciding whether or not to grant leave to adduce further evidence:

1.It must be shown that the evidence could not have been obtained with reasonable diligence at an earlier stage.

2.The evidence must be such that, if given, it would probably have an important influence on the result of the case.

3.The evidence must be such as is presumably to be believed, that is it must be apparently credible, though not necessarily incontrovertible.

Mr Angliss also referred to two further criteria.  These were set out in the decisions Sandoz Ltd v Fujisawa Pharmaceutical Co Ltd 27 IPR 421 and Imperial Chemicals Industries Plc v Mitsubishi Gas Chemical Co 29 IPR 285. I will set out these criteria as follows:

4.If the request to serve further evidence was allowed, would this cause unnecessary protraction of the opposition?

5.Would there be injustice caused to the other party if the request was allowed?

Both the Sandoz and Imperial Chemicals Industries decisions dealt with requests for further evidence under the 1991 regulations.  But these two criteria are also consistent with decisions handed down under the 1952 Act and regulations.  For example, see Sue & Anor v Carpenter (1991) AIPC 90-750. I will consider each of the above five criteria.

Reasonable diligence

In his declaration accompanying the application for special leave, Mr Baddeley stated that the opposition was complex and the review of materials was a complicated and time consuming business.  As a result, the settlement of the applicant's evidence had taken longer than would normally be the case but had been carried out diligently in the circumstances.  Mr Baddeley also submitted, in his declaration and at the hearing, that the part evidence in reply filed by the opponent included a declaration made by Mr Russel Allan Cassey as part of the evidence in support to Application No 583115.  According to Mr Baddeley, it seemed from the inclusion of the Cassey declaration in the present proceedings that obviousness is a focus of the opponent's case against the claims of the opposed application.  He submitted that the further evidence includes evidence in rebuttal of this allegation, the allegation being made in a context not alluded to in the original evidence in support.

At the hearing Mr Angliss referred me to the Lustig declaration.  The Lustig declaration is 63 pages long.  Page 1 sets out the qualifications of Mr Lustig.  Pages 2 to 7 give Mr Lustig's assessment of the invention.  In pages 7 through to 22 Mr Lustig gives a review of the prior art documents that were filed as exhibits to the evidence in support.  Pages 23 to 40 comment on the declaration of Ian NM Woolard that formed part of the evidence in support.  Pages 40 to 53 and pages 53 to 63 address the declarations filed by Ian R Harrison and Mario Gillio-Tos respectively.  Both these declarations were also filed as evidence in support. The further evidence does not address the Cassey declaration.

The entire declaration by Mr Lustig is directed to material that was filed as evidence in support.  There is nothing in the declaration that the applicant could not have ascertained based on the evidence in support.  The evidence is more correctly evidence in answer rather than further evidence.  Therefore the applicant has not shown that the evidence could not have been obtained with reasonable diligence at an earlier stage.

Important influence on result

Mr Baddeley argued that the further evidence addresses issues of obviousness and is important to resolution of the opposition.  Mr Angliss responded that the only part of the Lustig declaration that was directed to obviousness was a brief mention at paragraph 4.1.28, which was directed to the evidence in support.  Mr Angliss also pointed out that the alleged further evidence filed was really evidence in answer.  Because of the timing of the evidence, the weight given to this factor should be reduced.

The Lustig declaration does not appear to deal in any detail with the issue of obviousness.  The declaration is directed in the main to novelty considerations raised in the evidence in support.  Therefore it seems unlikely that the further evidence would have an important influence on the question of obviousness.  The further evidence may however have an influence on the question of novelty.  Mr Lustig is the inventor of the present application and, on the face of it, an expert witness.  His declaration may have an important influence on the analysis of the specification and citations.  The probable influence of the further evidence needs to be balanced against the other criteria for further evidence.

In The Dupps Company v Stord Bartz A/S 18 IPR 499, a delegate of the Commissioner held that evidence sought to be adduced under reg 59(1) ought to have special characteristics. It should not be evidence which should have been lodged under reg 55 had an application for extension of time not been refused. In the present case, I believe that the evidence should have been filed under reg 56. In my view, special leave should not be a means of overcoming the previous denial of an extension of time beyond ten days.

Apparently credible

A further factor to be considered is whether or not the evidence is apparently creditable, though not necessarily incontrovertible.  The evidence which Viskase is seeking to adduce is a declaration by Stanley Lustig.  Mr Lustig is an employee of Viskase and the inventor of the invention.  I have no reason to doubt the credibility of the evidence.

Unnecessary protraction

Regulation 60(2) allows the other party one month to adduce evidence in reply to the further evidence.  As the declaration was filed with the application for special leave, this period has already expired.  However it has been office practice to allow an extension of time in these circumstances, for example see  Micronair v Waikerie (above).  Due to the complexity of the issues involved in the opposition, as agreed to by both parties, it is likely that one month would be insufficient time to respond to the Lustig declaration.  The opponent would require a longer period to adduce evidence in reply.  Therefore the further leave would result in protraction of the opposition.  Given that the evidence could have been filed as evidence in answer, the protraction is unnecessary.

Injustice to other party

If I allowed the application to serve further evidence, this would in effect give the applicant a defacto extension of time to serve evidence in answer.  The applicant was previously given extensions such that a period of almost 22 months was available to serve evidence in answer.  If I granted special leave to lodge the further evidence, this would give the applicant a further 12 month extension to file evidence which is in answer to the evidence in support.  This would clearly cause injustice to the opponent.

As I have found that the evidence could have been filed as evidence in answer had the applicant shown reasonable diligence, the request for special leave is not allowable.

Material Filed After the Hearing

On 27 September 1995 Mr Angliss phoned me and said he had received a copy of another declaration by Stanley Lustig which had been served in the corresponding New Zealand opposition.  He said he would be filing the new material as it was relevant to the further evidence.  Mr Angliss filed a copy of the Lustig declaration served in New Zealand together with a declaration by Gregory James West-Walker, a NZ patent attorney, in the Melbourne state office on 29 September 1995.  A copy of the covering letter was faxed to me on the same day.  Mr West-Walker states in his declaration that the Lustig declaration was filed in the NZ office on 24 February 1995.  I received another letter from Mr Angliss on 3 October stating that there were only minor differences between the New Zealand declaration and the Australian declaration.  The differences relate to headings set out for New Zealand and the correction of some typographical errors.  Mr Angliss submitted the declaration filed in New Zealand was identical in substance to the declaration which the applicant was seeking to adduce as further evidence.  He submitted this showed that the evidence sought to be adduced was available to the applicant well before the application to seek special leave.

By letter received on 11 October 1995, Mr Baddeley stated that the opponent was provided with the opportunity to make full submissions regarding the application for special leave at the hearing.  He submitted that the opponent was also in possession of all facts necessary to make the further submissions at that time.  He felt that the matter was closed by the hearing.

I do not think that I should automatically shut out new material if it will help produce a more correct result.  On the face of it, the NZ copy of the Lustig declaration strongly suggests that the declaration sought to be adduced as further evidence was available well before the application for special leave was made.  However there are some issues regarding the New Zealand declaration which are unresolved.  For example, there is no indication as to what grounds of opposition are being contested in New Zealand.  If the material had been available at the hearing, these matters may have been resolved.  While the new material prime facie appears to confirm the conclusions I have drawn above, I have not placed any weight on it.

extension of time

The period for filing evidence in reply commenced on 25 July 1994.  Following the initial period allowed for filing evidence in reply, Grace were granted two 3 month extensions to 25 April 1995.  Grace were then allowed a number of 1 month extensions to 25 July 1995.  A request for a further one month extension to 25 August was objected to by Viskase.  As the hearing was held after this date had passed, Grace have sought further extensions to file their evidence in reply.

The reasons given for the said one month extension of time were as follows:

"The senior patent attorney in the United States of America, having overall responsibility for the conduct of the present opposition within the opponent company Mr L George Legg, has recently left the employ of the opponent and further time is required for a new U.S. attorney to familiarise themselves with the nature and status of the opposition.  Accordingly, prior to the completion of the evidence-in-reply the opponent considers it necessary for the U.S. attorney assuming responsibility for the opposition to review the draft evidence-in-reply following familiarisation with the considerable amount of correspondence and evidence relating to the present opposition.  Once the U.S. attorney has reviewed the draft evidence-in-reply the declarant, Ian Woolard, will require further time to execute the declaration."

According to reg 83a the Commissioner shall not grant the extension of time unless he is satisfied that the extension is justified having regard to all the circumstances of the case.  The law on extensions to file evidence has been expressed in Vangedal-Nielsen v Commissioner and Gelphen Nominees 33 ALR 144. Briefly stated:

1. Before allowing the extension, I must be satisfied that the person seeking the extension has made out a proper case justifying the extension; and

1. I must consider not only the private interests of the parties, but also the public interest.  The public interest requires a balance between the need to ensure invalid patents are not granted and that proceedings are not unreasonably protracted.

At the hearing Mr Angliss reiterated the circumstances set out in the application for extension of time.  He submitted that it was reasonable for the opponent to be given time for the new US attorney handling the case to become familiar with the opposition and to be in a position to be able to provide proper instruction and proper comment on the evidence in reply. 

Mr Baddeley responded that the opponent had given insufficient reasons as to why the US attorney needed to review the local expert's evidence.  He also questioned why this could not have been done at an earlier stage.  Mr Baddeley said that there had been several opportunities for the US attorney to review a draft of the evidence, if this was necessary.  He also referred me to Austoft Industries Ltd v Cameco Industries Ltd 29 IPR 425. In that decision the hearing officer stated that if an attorney knew he was going to be unavailable, he could have made alternative arrangements. Mr Baddeley argued that if Mr Legg left suddenly, this should have been set out in the reasons. If he retired or gave notice in time for someone to familiarise themselves with the case, the opponents should have made the necessary arrangements.

Mr Angliss replied that the circumstances in Austoft v Cameco were completely different.  In this case, Grace had a number of in-house attorneys having particular areas of responsibility within particular business units.  As far as the Australian attorneys prosecuting the case were concerned, the in-house attorneys were the opponent.  Mr Angliss submitted that it was not unreasonable for the opponent to review the evidence before filing.

In my view, it is reasonable that the opponent would want to review the evidence before it was filed.  However, the opponent has already had 12 months to prepare and review its evidence in reply.  It is not clear why further revision of the evidence was required merely because the US attorney assuming responsibility had changed.  An application for extension of time filed on 25 January 1995 stated that a "draft Woolard declaration to be used as a leading reply declaration has been prepared."  A further application for extension filed on 26 April 1995 stated that "Mr Woolard is currently overseas but it is expected that the declaration ... will be executed on his return and filed and served within the next month."  While the draft declaration has been revised several times, it appears that the opponent has had several opportunities to review the declaration.  The fact that a new US attorney has assumed responsibility of the case does not appear to justify an extension when his predecessor has had several opportunities to review the evidence.

I also agree with Mr Baddeley that the application does not give sufficient reasons regarding the circumstances surrounding the departure of Mr Legg.  I appreciate Mr Angliss' position that as far as he is concerned the US attorney is the opponent.  However, in this case the opponent was only reviewing the evidence of the Australian expert.  The reasons are insufficient to determine if it was possible to make alternative arrangements prior to Mr Legg's departure.  While I understand that the Australian attorneys representing the opponent may not have known the full circumstances, it is the opponent who is seeking the Commissioner's discretion.  It is incumbent on the opponent to set out all the circumstances relevant to the extension.

Mr Angliss also submitted that the application to adduce further evidence filed by the applicant had delayed the proceedings.  He argued that the effect of the extension of time had effectively been hidden by the delay caused by the application for further evidence.  While preparation for the hearing on the further evidence may have consumed some of the time of the Australian attorney, insufficient reasons have been given on any affect this may have had on the preparation of evidence in reply.

I must also consider the public interest.  The application was filed in April 1986.  It was accepted and then opposed in 1991.  The fate of the application has been in a state of uncertainty for a considerable time.  The courts have repeatedly said that proceedings should not be unreasonably protracted, as long as the primary goal of achieving justice is not lost sight of.  The opponent has not provided sufficient justification for an extension of time.  I see no reason to further delay proceedings.

It appears from the applications for extension which have previously been filed that at least a draft copy of the evidence has been prepared.  In Ferocem Pty Limited v Commissioner of Patents, (1994) AIPC 91-057, Burchett J. observed:

"... even where an application for a particular period ... is regarded as unjustified, it seems to me a decision maker, having a discretion of the kind conferred by Regulation 5.10, should always consider whether some short period should be allowed, so that an applicant who may have assumed some extension would be granted will not be shut out entirely from presenting evidence that may be immediately available."

This appears to be equally applicable to extensions sought under the 1952 Act.  I will therefore allow an extension of ten days from the date of this decision.

CONCLUSIONS

I have found that the evidence sought to be adduced as further evidence is directed entirely at material that was filed as evidence in support.  There is nothing in the further evidence that the applicant could not have ascertained based on the evidence in support.  I refuse the application for special leave to adduce further evidence.

In regard to the extension of time to file evidence in reply, the opponent has not given sufficient reasons to justify an extension.  The fact that a new US attorney has assumed responsibility of the case does not appear to justify an extension when his predecessor had several opportunities to review the evidence.  However I have allowed an extension of 10 days from the date of this decision to file any evidence which the opponent has prepared, so that they will not be shut out entirely.

COSTS

Normally costs follow the event.  In this case, Viskase have been unsuccessful in their application for special leave.  Similarly, Grace have not justified their application for an extension of time.  I make no award of costs.

Brendan Bourke
Delegate of the Commissioner of Patents

Patent attorneys for the applicant  :  Watermark, Perth

Patent attorneys for the opponent   :  Davies Collison Cave, Melbourne