YAMAZAKI Mazak Corporation v Nakamura-Tome Precision Industry Co Ltd and Six Others
[1992] APO 6
•27 February 1992
official notice
decision of a delegate of the commissioner of patents
Petty Patent : Nos. 601140 and 601669 in the name of YAMAZAKI MAZAK CORPORATION
Title : A Machine Tool
Action: Applications under S. 69 for an extension of the term of each petty patent, notices by 7 persons under S. 28. Hearing on applications for adjournment of the hearing of the extension of term matters.
Decision: Issued .
An adjournment:
-is not appropriate to enable an informant to consider and file additional evidence
-is justified for the purposes of preparing for the hearing
-is not justified to await the outcome of a court appeal involving the petty patents.
patents act 1990
decision of a delegate of the commissioner of patents
Re:Petty Patents Nos 601140 and 601669 in the name of YAMAZAKI MAZAK CORPORATION, applications under section 69 for an extension of the term of each petty patent, notices by persons under section 28 regarding the petty patents, and applications for adjournment of the hearing of the extension of term matters.
ACTION
The patentee applied to extend the term of its petty patents 601140 and 601669. Certain persons filed section 28 notices against these petty patents. This matter concerns applications by those persons seeking an adjournment of the hearing set for the extension of term matters. All parties involved were heard on the adjournment requests.
BACKGROUND
To fully appreciate the reasons for the adjournment requests and the hearing of the parties thereon, I will refer in some detail to various background matters.
Petty patents 601140 and 601669
These petty patents were sealed on 16 July 1990 and 30 July 1990 respectively. The inventions the subject of the petty patents concern a "machine tool", which I describe more specifically as a multifunction lathe device. The petty patents were granted on applications which were filed as divisional applications from standard patent application 601838 (formerly 15283/88). Application 601838 was advertised accepted on 29 September 1990 and is subject to opposition action prior to patent grant.
The patentee YAMAZAKI MAZAK CORPORATION ("YAMAZAKI") applied for an extension of the term of each petty patent, respectively on 12 February 1991 and 21 May 1991.
Notices under section 28 of the Act
Seven persons ("informants") notified the Commissioner of Patents ("the Commissioner") of matters pursuant to section 28 in relation to these petty patents within the prescribed times (ie. by 30 June 1991). These informants are
a.NAKAMURA-TOME PRECISION INDUSTRY CO LTD ("NAKAMURA")
b.IMT INTERNATIONAL MACHINE TOOLS PTY LTD ("IMT")
c.INTERACT MACHINE TOOLS (NSW) PTY LTD ("INTERACT")
d.K K TAKISAWA TEKKOSHYO ("TAKISAWA")
e.KABUSHIKI KAISHA MIYANO ("MIYANO")
f.MORI SEIKI SEISAKUSHO CO LTD ("MORI")
g.FANUC LIMITED ("FANUC")
Collectively, the informant material consists of many hundreds of pages, and includes copies of patent specifications and trade catalogues.
On 12 September 1991, the Commissioner sent a copy of all the informant material to the patentee. The Commissioner afforded the patentee a period of 3 months to respond by evidence to these notices if it so desired. The patentee filed such evidence on 7 November 1991 and served copies on each informant shortly thereafter.
Court action/infringement proceedings
YAMAZAKI commenced infringement proceedings based on petty patents 601140 and 610669 against NAKAMURA, IMT and INTERACT in the Federal Court on 14 September 1990. A counter-claim asserting invalidity of the patents was filed by IMT and INTERACT. The court hearing took place in early August 1991 and judgement was delivered on 23 September 1991. Mr Justice Gummow found the petty patents valid and infringed, but as the initial terms had expired, he could not grant an injunction restraining the defendants in their infringing actions. NAKAMURA, which is a Japanese company, took no part in the proceedings, but as it had provided an indemnity for IMT and INTERACT, judgement was also against it. [The judgement is reported at (1991) AIPC 90-830]
Gummow J subsequently granted the defendants leave to appeal his judgement, and an appeal to the Full Court of the Federal Court was filed on 25 October 1991. Whilst the appellant parties have undertaken to process their appeal promptly, it seems that a hearing of the appeal is unlikely before May 1992. Apparently, NAKAMURA is an active party to the appeal.
Hearing set for extension of term applications
When filing its evidence on 7 November 1991, and by further letter of 20 November 1991, YAMAZAKI requested the Commissioner to set its extension of term applications for hearing as a matter of urgency, desirably before the end of December. The Patent Office issued hearing notices to the patentee and each informant by facsimile on 4 December 1991, the hearing being set for Monday 16 December 1991 in Canberra.
Requests made for the adjournment of the hearing
On 10December 1991, Davies Collison Cave, patent attorneys, informed the Commissioner that they now represented NAKAMURA. They requested that the hearing be adjourned on various grounds. On the same day all other informant parties also requested the hearing be adjourned.
On 13 December 1991, the Patent Office notified the parties that the hearing as set down would proceed. After receipt of that notice, several informants requested to be heard on the question of their adjournment requests. Those requests were denied by a delegate of the Commissioner who was of the view that there was no basis or requirement to set down for hearing a request to adjourn a hearing of which the parties had been given the required 10 days notice.
Court orders obtained regarding the hearing date
Following the denial of their requests to be heard on the adjournment requests, four informants sought and obtained orders from Mr Justice Olney of the Federal Court late on 13 December 1991 to prevent the Commissioner hearing the extension of term applications on 16 December 1991. On 16 December 1991, YAMAZAKI applied to the Federal Court to have the orders set aside or varied. After hearing counsel for YAMAZAKI and various informants, Mr Justice Ryan varied the previous orders. The revised orders, in effect, required the Commissioner to hear any party on the question of adjournment before hearing the substantive extension of term matters.
The Commissioner, by his delegate, sought to set the adjournment question for hearing as soon as possible and initially set it for 18 December 1991. However that date was vacated for 19 December and then the latter date was also vacated when the delegate did not receive the transcripts of the court hearings or, in the second instance, the reasons for Ryan J deciding to vary the orders, in good time before the scheduled hearing times.
At a further hearing before Mr Justice Gray of the Federal Court on 19 December 1991 at which the Commissioner, as well as the patentee and various informants were represented, the Commissioner undertook to hear the parties on the adjournment matter on 21 January 1992 and not to hear the applications for the extension of terms before 4.15 pm on 6 February 1992.
Adjournment hearing
The patentee and all informants were represented at the hearing in Canberra on 21 January 1992. The hearing provided all parties who wished to be heard on the adjournment matter an opportunity to be heard. I have listed at the end of this decision the appearances for the parties at the hearing.
There are basically two main grounds advanced by the informants for the adjournment of the hearing of the extension of term matters:
a.more time is required to enable full consideration of the patentee's evidence, to prepare and file reply evidence, and to properly prepare for the hearing, and
b.it is inappropriate to hear the extension of term matters while the appeal in the Federal Court remains undecided.
THE LEGISLATION
Before turning to the submissions of the parties, I feel it is necessary to refer to and set out in some detail those portions of the patents legislation relevant to petty patents and their term as well as some other provisions relevant to procedural practice. The Patents Act 1990 ("the 1990 Act") and the Patent Regulations (Statutory Rules 1991 No.71) came into operation on 30 April 1991.
Acceptance, grant and publication of a petty patent
Section 50 of the 1990 Act relates to the consideration and acceptance by the Commissioner of a patent request for the grant of a petty patent. Section 62 relates to the grant of a petty patent and its publication.
Term of petty patent
The term of a petty patent is specified in section 68 which provides:
68. The term of a petty patent is:
(a)the period of 12 months beginning on the date of sealing of the patent; and
(b)if an extension of the term of the patent is granted - an additional period beginning on the day immediately following the end of that 12 months' period and ending at the end of 6 years after the date of the patent.
Extension of term of petty patent
Section 69 and regulations 6.5 and 6.6 enable a patentee to apply for an extension of term of its petty patent and for the Commissioner to consider that application. The provisions are as follows:
69. (1) A patentee of a petty patent may apply to the Commissioner, in accordance with the regulations, for an extension of the term of the petty patent.
(2) The Commissioner must decide an application in accordance with the regulations.
(3) The Commissioner must not grant an extension without giving each person who has given the Commissioner a notice under section 28 in relation to the petty patent a reasonable opportunity to be heard.
(4) The Commissioner must not refuse to grant an extension of the term of a petty patent that the Commissioner is satisfied is invalid unless the Commissioner has, where appropriate, given the applicant a reasonable opportunity to amend the relevant patent request or complete specification, or both, for the purpose of removing the grounds of the invalidity and the applicant has failed to do so.
(5) Where the Commissioner grants an extension, the Commissioner must notify the applicant in writing of the grant and publish a notice of the grant in the Official Journal.
(6) Where the Commissioner refuses to grant an extension, the Commissioner must:
(a) give the applicant written notice of the refusal and of the reasons for it; and
(b) publish a notice of the refusal in the Official Journal.
(7) An appeal lies to the Federal Court against a refusal by the Commissioner to grant an extension.
(8) A person who has given the Commissioner a notice under section 28 in relation to a petty patent may appeal to the Federal Court against a decision of the Commissioner to grant an extension of the term of the petty patent.
6.5 (1) For the purposes of subsection 69 (1) of the Act ("extension of term of petty patent"), an application for an extension of the term of a petty patent must:
(a) be in the approved form; and
(b) be made within 11 months of the date of sealing of the patent.
(2) If a patentee applies for an extension of the term of a petty patent, the Commissioner must publish in the Official Journal a notice stating that the application has been made.
6.6 (1) For the purposes of subsection 69 (2) of the Act ("extension of term of petty patent"), in deciding an application for an extension of the term of a petty patent, the Commissioner must consider:
(a) any notice under subsection 28 (1) of the Act ("notice of matters affecting validity of petty patents") in relation to the petty patent; and
(b) any matter of which the Commissioner has informed the patentee under subsection 28 (3) of the Act.
(2) If the Commissioner is satisfied that a ground mentioned in subsection 28 (1) of the Act is made out, the Commissioner may refuse to grant an extension of the term of the petty patent.
(3) If the Commissioner is satisfied that no ground mentioned in subsection 28 (1) of the Act is made out, the Commissioner must grant the extension of the term of the petty patent.
Notice of matters affecting validity of petty patents
Section 28 and regulations 2.6 and 2.7 permit persons to notify the Commissioner within 11 months from the date of petty patent grant of matters affecting the validity of a petty patent. These provisions are as follows:
28. (1) A person may, within the prescribed period after the grant of a petty patent, notify the Commissioner, in accordance with the regulations, that the person asserts, for reasons stated in the notice, that the petty patent is invalid on one or more of the following grounds:
(a) that the patentee was not entitled to be granted the petty patent;
(b) that the invention is not a patentable invention because it does not comply with paragraph 18 (1) (a) or (b);
(c) thatthe specification does not comply with subsection 40 (2) or (3).
(2) The Commissioner must inform the patentee in writing of any matter of which the Commissioner is notified and send the patentee a copy of any document accompanying the notice.
(3) If the Commissioner becomes aware, otherwise than by a notification under subsection (1), of any matter that may affect the validity of a petty patent on one or more of the grounds mentioned in that subsection, the Commissioner must inform the patentee in writing of the matter.
(4) A notice given to the Commissioner and any document accompanying it are open to public inspection.
2.6 For the purposes of subsection 28 (1) of the Act ("notice of matters affecting validity of petty patents"), the prescribed period is 11 months from the day on which the petty patent is granted under subsection 62 (1) ("grant and publication of petty patent").
2.7 Notice of an assertion under subsection 27 (1) ("notice of matters affecting validity of standard patents") or 28 (1) ("notice of matters affecting validity of petty patents") of the Act must, where the assertion is based on a document, have with it:
(a) if the document is not available in the Patent Office - a copy of the document; and
(b) if the document is not in English - a translation of the document into English and a related certificate of verification; and
(c) evidence of the date and place of publication of the document.
Exercise by Commissioner of certain powers
Section 216 and Regulation 22.22 provide for the Commissioner to hear a person before exercising a discretionary power adverse to that person.
Hearings
Regulation 22.23 relates to the procedure for the Commissioner to set and conduct hearings. It provides as follows:
22.23 (1) The Commissioner must give notice of the date, time and place of a hearing before him or her to each party to the hearing at least 10 days before the day when the hearing is to begin.
(2) The Commissioner may adjourn a hearing from time to time or from place to place by notifying the parties to the hearing accordingly.
(3) The Commissioner may hold a hearing:
(a) at which the parties appear before him or her in person; or
(b) in which a party participates by telephone or such other means of telecommunication as the Commissioner reasonably allows.
(4) If a party to a hearing does not intend to appear at the hearing, the party may make a submission in writing to the Commissioner before the hearing begins to which the Commissioner must have regard in reaching his or her decision on the matter being heard as if:
(a) the party were present or otherwise participating in the hearing; and
(b) the matter of the submission were presented by the party in the presence of the Commissioner.
(5) The Commissioner must, after hearing the person, notify him or her of the decision.
Practice and procedure other than for opposition proceedings
Regulation 22.24 enables the Commissioner to determine the practice and procedure to be followed in hearing and deciding matters other than opposition proceedings, the latter being separately provided for in Chapter 5 of the Patent Regulations.
SUBMISSIONS
At the hearing, all parties were given an opportunity to present submissions on the adjournment matter. I will summarise those submissions in turn commencing with the various informants and in the order presented at the hearing.
NAKAMURA
Mr R Macaw QC for NAKAMURA firstly said that the adjournment application is sought within the terms of subregulation 22.23 (2) of the Patent Regulations. He indicated that NAKAMURA sought an adjournment of the hearing of the extension of term applications for the petty patents for two main reasons. Firstly, more time is needed to enable NAKAMURA to properly present its case. This had three aspects, namely:
(a)its patent attorneys and legal counsel, who were all new to the action being only engaged in early December 1991, need adequate time to read and understand all the documents concerning the petty patents and the extension of term actions - there is a considerable amount of material to review;
(b)it believes there is scope for evidence to be led in reply to the evidence lodged by the patentee, evidence which is relevant and critical to the outcome of the extension of term applications; and
(c)it also believes that other evidence, not necessarily "reply" evidence should be filed to enhance its objection.
Secondly, NAKAMURA submits that it is inappropriate for the Commissioner to hear and decide the extension of term matters while similar matters are before the Federal Court and the appeal in that court remains undecided. As to length of adjournment sought, Mr Macaw submitted that this should be until after the hearing and determination of the appeal in the Full Federal Court or alternatively until NAKAMURA has had a similar period to that afforded YAMAZAKI in which to reply to the YAMAZAKI material-in- answer.
At the hearing, NAKAMURA filed three statutory declarations by Keith Leslie, patent attorney of the firm Davies Collison Cave. These declarations explain the events leading to NAKAMURA appointing new attorneys and legal counsel in December 1991, indicate efforts by Mr Leslie and others to date to review the material concerning the petty patents both before the court and the Patent Office, and estimate what further time may be required by NAKAMURA to fully prepare its case for hearing.
Mr Macaw submitted that under subsection 69(3), the Commissioner is obliged to give each party who has filed a notice under section 28 a "reasonable opportunity to be heard". He added that the clear legislative intent is that the rules of natural justice, which impart the need for a fair hearing, would apply in the extension action here as it does in most actions (Kiao v.West (1985) 159 CLR 550 at 584, 609 and 632 referred to). Furthermore the requirement for a reasonable opportunity to be heard involves at least the ability for NAKAMURA to rely on appropriate evidentiary material and to be well enough prepared to present its case properly. On Mr Macaw's submission, a failure to adjourn, given the position NAKAMURA now finds itself in, with its changed representation and patentee's evidence before it, would break the rules of natural justice and would cause NAKAMURA enormous prejudice in presenting its case. In support of the latter point, Mr Macaw referred me to Gas & Fuel Corporation of Victoria v. Woodhall Ltd & Leonard Pipeline Contractors Ltd [1978] VR 385 at 404-406; Flick, Natural Justice 2nd Ed. p.64; and Hallsbury 4th Ed Vol.1 para 76 pp.93-94.
Expanding on the basis for NAKAMURA requiring more time, Mr Macaw enumerated some seven distinct steps that his client considered necessary before being properly prepared for the hearing. These were referred to in Mr Leslie's declarations. These steps include the need to:
-consult and engage additional expert witnesses,
-prepare and serve evidence in reply,
-consider, and if appropriate obtain expert evidence, on a paper anticipation not relied on at the trial before Gummow J, and
-continue current searches for further paper anticipations.
Mr Leslie indicates that, after allowing for all these steps, "I would not expect to be in a position to properly present Nakamura's case at the extension hearing until towards the end of March, 1992 at the earliest".
As to the question of possible prejudice to the patentee if an adjournment for 3 months or even until after the appeal is determined, Mr Macaw submitted there is little or none. He said there is no disadvantage if the extension applications fail. Alternatively, if the extension applications succeed, then the patentee is free to obtain relief for infringing actions for the term of the patents (see Guertler v. Antenna Engineering Australia Pty Ltd 6 IPR 170).
Mr Macaw also submitted that it is in the public interest to grant the adjournment. He submitted that the first aspect of the public interest is that the Commissioner should have before him all facts before making a decision on the extension of term to ensure as far as possible that only valid patents are extended. To support this point he referred to the following Office decisions on extension of term of petty patents under section 68B of the Patents Act 1952 (the forerunner to section 69) regarding the filing of evidence in the proceedings: Wright v. Ajax Davy Pty Ltd 9 IPR 77; Vulcan Australia Ltd v. Braemar Appliances Pty Ltd 6 IPR 143; Re Application by Schmidt 1 IPR 519. A second aspect of public interest, he submitted, relates to the certainty of the fate of the petty patents and hence the need to decide the extension of term applications speedily once their initial terms have expired. Mr Macaw submitted that in this case, a speedy decision on the extension matters will not contribute to the public certainty about the fate of the petty patents since matters are before the court on appeal.
As to the allowance of a further period of time for NAKAMURA to file extra evidence, Mr Macaw submitted that Office practice or the legislation did not prevent this (see decisions in Vulcan (supra), Wright (supra) and Massey v. Noack 11 IPR 632). He submitted that the approach taken in the Wright case is appropriate in extension of term proceedings. His submission was also to the effect that it did not matter if a party sought to file material or evidence after the period prescribed in regulation 2.6 had expired. In fact he suggested that the presence of subregulation 6.5 (2), which had no equivalent in the former legislation, permitted a person who saw that advertisement to then file material relating to the validity of the petty patent, even though this may be beyond 11 months from sealing.
The final submission was that it is inappropriate for the Commissioner to deal with the extension applications and thus deal with the same or similar issues that remain before the court on appeal. He said that on principle it is undesirable to intrude on the court process, there is potential for inconsistency between the court view and that of the Commissioner on similar issues if there is no adjournment, and to proceed with the extensions hearing could well lead to wasted effort and resources if the court on appeal finds the patents are invalid. On the other hand, to delay the extensions hearing until after the court appeal may, if the patents are held valid by the court, simplify matters to be determined by the Commissioner.
MIYANO
Mr Pryor, patent attorney for MIYANO, adopted NAKAMURA's submissions of natural justice and procedural fairness regarding his client's reasonable opportunity to be heard on the extension applications. He also agreed with Mr Macaw's submissions concerning public interest and the points raised regarding the Commissioner not hearing the extension applications before the court appeal is resolved.
Mr Pryor said that MIYANO is not a party to the infringement proceedings. MIYANO had instructed him to file a section 28 notice which he did using material assembled on behalf of other informants. From his submissions, it seems that Mr Pryor only received further instructions in the extension matter after receiving patentee's evidence on 21 November 1991. Mr Pryor submitted that it cannot be presumed that MIYANO had full knowledge of matters before the court - he certainly did not have such knowledge. He said that the patentee's evidence included a considerable amount of material based on the court proceedings including the entire transcript of the 7 day hearing. Until MIYANO has properly considered all this material it is not in a position to determine what other steps it may need to take to be able to present its case properly at the hearing. Mr Pryor submitted that MIYANO needs to perform much the same steps as NAKAMURA has identified before being properly prepared for the hearing. Because of the short notice of the extensions hearing, MIYANO was unable to properly address these matters. Accordingly MIYANO would suffer prejudice if an adjournment is not given.
MIYANO also wanted more time in order to fully assess the transitional provisions of the Patents Act 1990. Mr Pryor submitted that while the matter before the court relied on regulation 23.26 (1) and accordingly the former provisions on such validity questions as obviousness applied, more review of the legislation (including section 233) is needed to ascertain whether the same provisions applied to the current extension of term actions.
Finally Mr Pryor submitted that the Commissioner should afford MIYANO an opportunity to file evidence-in-reply to the YAMAZAKI material: a period of 3 months should be allowed in which to do so. On that basis, the hearing should be adjourned until about one month after the date for filing such evidence.
IMT and INTERACT
Mr Cowin, patent attorney for IMT and INTERACT, concurred with submissions made on behalf of NAKAMURA since most apply equally to his clients. His clients have a court judgement against them and have appealed. Mr Cowin submitted that the court proceedings should be fully and finally dealt with before the extension applications are considered. Accordingly his clients sought an adjournment on the same general basis as NAKAMURA.
TAKISAWA
Mr Cowin said that TAKISAWA is in a somewhat similar position to MIYANO. TAKISAWA is not involved in the court proceedings and, like MIYANO, needs adequate time to properly consider patentee's evidence and prepare its case for hearing. Accordingly it seeks an adjournment to gain additional time in which to perform all steps necessary prior to the hearing. Mr Cowin submitted that it is inappropriate to have the same or similar issues canvassed before the court and the Patent Office at the same time, and to proceed with the extensions hearing would foreseeably lead to a waste of time and expense for all parties and the Patent Office.
FANUC
Mr Kildea, patent attorney representing FANUC, submitted that FANUC is not a party to the court proceedings. He adopted the basic submissions presented on behalf of NAKAMURA and other informants. Mr Kildea said that FANUC also needed more time to digest patentee's evidence and required an adjournment for that purpose. Mr Kildea raised various scenarios based on whether or not the Commissioner heard the extension matters before the court appeal. He pointed out that in most situations, a hearing before the Commissioner before the court appeal is decided is unlikely to finalise the extensions question. He submitted that to adjourn the hearing does not prejudice the patentee, whereas no adjournment would prejudice all parties.
MORI
Mr Shelston, patent attorney for MORI, said his client's position is similar to that of MIYANO and accordingly he adopted submissions presented on behalf of MIYANO. He submitted that despite his best efforts, he had not fully "come to grips" with all material filed by the patentee. Mr Shelston agreed with earlier submissions regarding the inappropriateness of hearing the extension applications before the court appeal and the issues arising therein are resolved. To proceed with the extensions hearing would cause inconvenience to the parties and additional costs to all. However, if the hearing is adjourned until after the court action, the extension matters may be considerably simplified.
YAMAZAKI
Mr Catterns of counsel for YAMAZAKI, said the informants sought the adjournment basically on 4 grounds, namely
they need more time to prepare for the hearing,
they need time to reply to the evidence of YAMAZAKI,
they need time to search and obtain new evidence, and
somewhat as an alternative, they want the court appeal to be resolved first.
He submitted that most of the submissions by the informants misconceived the legislation and how the petty patent system works. With regard to grounds 2 and 3 he submitted that they were not entitled as a matter of law to file reply evidence or further evidence.
Mr Catterns referred to my decision in the Vulcan case (supra) wherein I considered the operation of the 1952 Act legislation regarding the extension of term of petty patents. He submitted that the approach taken there regarding the filing of the notice by an informant and the question of the admissibility of evidence filed after the due date for any such notice was entirely correct and applied equally to the present legislation. In fact Mr Catterns submitted that the 1990 Act and Regulations, if anything, made the situation clearer regarding the operation of the extension provisions and is in line with the practice indicated in the Vulcan decision. He submitted that the differences in the present legislation relied on by Mr Macaw do not import the conclusions advanced by Mr Macaw. Firstly, regarding subsection 69 (3), there was never any question in law that an "opportunity to be heard" in the former legislation meant anything other than a reasonable opportunity. Secondly, regulation 6.5 (2) is there to alert the public to the fact that the patentee seeks to extend the term of the petty patent beyond its initial 1 year term and has nothing to do with extending the strict requirements of section 28.
Regarding the Kioa case (supra) mentioned by Mr Macaw, Mr Catterns submitted that the principles of natural justice and fair practices placed on decision-makers exercising statutory power depends very much on the nature of the proceedings and framework of the legislation. He said the circumstances in the present extension actions are entirely different to those in the Kioa case. Referring in detail to the legislation, Mr Catterns said that subsection 28 (1) with regulations 2.6 and 2.7 were quite specific. They require a person to file a notice with reasons and any necessary documents within 11 months of sealing. He said it was right to identify persons who had filed a section 28 notice as "informants" because that is all they are under the legislation. They are not opponents as that term is used in Chapter 5 of the regulations and do not enjoy the rights of opponents, such as the right to file evidence-in-reply or further evidence, as is provided in that chapter: they do however have a right to be heard on their material pursuant to subsection 69 (3). Mr Catterns submitted that the arguments on behalf of the informants regarding the filing of reply or further evidence, if accepted, would convert all petty patent extension actions into full oppositions and would be contrary to the legislation. Furthermore, referring to regulation 6.6 (1), Mr Catterns submitted that the Commissioner could only decide the extensions by considering material which is either before him by way of notice under subsection 28 (1) or which fell within the terms of subsection 28 (3).
Accordingly, Mr Catterns submitted that there is no basis for an adjournment on the grounds of an informant needing time to either file reply evidence or additional evidence, and least still were there grounds based on searching for additional evidence. On the latter ground, he said that most of the informants had given no indication of why, and for what additional matter, a search would be needed. As to needing more time to prepare for the hearing, Mr Catterns conceded this is a reasonable basis for an adjournment, but he said that the informants had to date already gained extra time for this purpose.
An alternative submission was put by Mr Catterns in the event that I decide to allow the informants to file reply evidence. He said that any such evidence should be strictly in reply and then only concern matters arising from the DAY and JONES declarations in YAMAZAKI's evidence. He submitted that only limited time should be needed for that.
Mr Catterns said that YAMAZAKI only received all the informant material from the Commissioner in September 1991, and responded to the offer provided by the Commissioner to file evidence in response to the notices in early November. Thus, contrary to suggestions by the informants, YAMAZAKI did not have 6 months to file evidence, nor can it be reasonably said that actions by YAMAZAKI have delayed the extension applications from coming to a hearing at an earlier date.
Mr Catterns submitted that YAMAZAKI is entitled to have its extension of term applications expeditiously considered, and disagreed that it is appropriate to wait until the court appeal be decided before the extensions hearing is held. He said his client, if it has a valid petty patent which is infringed, is entitled to the benefits of that patent. Without the terms of its patents extended, YAMAZAKI can not obtain the benefit of an injunction against the parties held to be infringing. He said that an order as to an account of profits, which is currently in YAMAZAKI's favour, is a "second best" outcome against the infringers. He also submitted that it is in the public interest that the question of the extensions be determined, given possible infringement and injunction implications.
He further submitted that the appeal is on a much narrower basis than the extension matters before the Commissioner. Also, not all informants are involved in the court appeal. Furthermore he submitted that there is only one possible instance where, if the Commissioner proceeded to hear the extensions, there would be a risk of wastage of time, etc and that would be if the Commissioner held the patents valid and the Federal Court held them invalid. That he said would be a risk which I would need to take into account in deciding whether to adjourn the hearings until after the appeal is decided.
OTHER SUBMISSIONS
During the course of the hearing I asked the parties whether they could direct me to any authorities which lent support to submissions that it was inappropriate for the Commissioner to proceed with the extensions hearing while the appeal was before the court. I also said I would accept any submissions on the point if provided in writing soon after the hearing with copies thereof served on the other parties.
At the hearing Mr Macaw suggested that the situation was closely analogous to principles of contempt and referred me to the case before the House of Lords, Attorney-General v. Times Newspapers Ltd [1974] AC 273 at p.309.
Subsequent to the hearing I received written submissions on this issue from YAMAZAKI, NAKAMURA and FANUC.
YAMAZAKI submits there is and can be no such authority. It further submits that in the event that the Commissioner hears the matters and determines the patents valid, but then the court holds them invalid in the appeal presently before the court, "there is no risk that such a result will bring the Commissioner into disrepute; still less that it will amount to contempt of the Federal Court if the proceedings before the Commissioner continue: Lockwood v. Commonwealth & Ors (1954) 90 CLR 177, at 185-6; State of Victoria v. BLF (1982) 41 ALR 71, at 122-123; Cooke v. Goodhew (1989) 91 ALR 447."
Its submission also refers to the situation where it may not be unreasonable for a decision-maker to delay making a decision until the law is clarified; see, for example, Thornton v. Repatriation Commission (1981) 35 ALR 485. However its submission suggests that the present circumstances do not justify an adjournment on that basis as the appeal does not relate to any area of uncertainty in the law. A final submission is that an administrative decision-maker is to apply the law as it stands.
NAKAMURA's main submissions, written with the knowledge of those by YAMAZAKI, are these. Firstly it refers to R v. Whiteway [1961] VR 168 at p. 171 which, it says, "acknowledges the appropriateness of an adjournment of a case by a lower court pending the decision of an appeal of another case raising similar legal issues". NAKAMURA submits that where an administrative tribunal is the decision maker, that reasoning applies with greater force. Secondly, the submission suggests that the Thornton case (supra) has relevance when considering an adjournment in this case, given the overlap of issues between the appeal and the extension actions, the interests of the parties involved, and any delay in the event of an adjournment. Thirdly, the submission rejects as irrelevant to the present matter YAMAZAKI's reference to applying the law as it stands, since the appeal "will not involve a change of law but merely a correct application of it". A further submission suggests that the Commissioner does not have a duty to proceed to hear and decide the extensions pursuant to subsection 69 (2) while the appeal is pending - in fact the legislative policy is to the contrary (see subsection 69 (4) with section 112). The submission also refers to 2 Patent Office decisions on the extension of the term of petty patents which proceeded even though infringement actions had been initiated, namely Gerber Scientific Products Inc v. North Broken Hill Limited 18 IPR 78, and Queensland Metal Frames Pty Ltd v. Lakecroft [1987] APOR 8.
I received two submissions on behalf of FANUC, one from its attorneys and one from Mr Kildea. Mr Kildea mainly reiterates in his submission a point he made at the hearing, namely that the Commissioner has had a long-standing practice to decline to take any action in respect of a patent or an application for a patent while that patent or application is the subject of court proceedings. He refers to some specific instances to support this point - I will make further reference to these instances later in this decision. He submits that the Commissioner should not adjudicate in respect of the extension applications until the Federal Court decides on appeal the validity question.
FANUC's attorneys submit that the Thornton case (supra) is a relevant precedent concerning a possible adjournment of an administrative tribunal proceeding where court proceedings on the same issues are pending. They submit that the Federal Court decision will determine issues common to the two proceedings and that it "is clearly inappropriate for the Commissioner to decide any issues which are presently before the court". The other points raised in the submission cover certain matters raised in submissions at the hearing which I will not repeat here.
DECISION
This action has many unusual aspects. It is the first occasion of which I am aware where the question of the adjournment of a hearing before the Commissioner has become a contested issue. Furthermore, I believe it is the first time where the Commissioner has been confronted with extensive representations regarding an adjournment. It is an action involving 8 distinct parties. It is an action which in part requires an assessment of procedures relating to petty patent extension of term actions under the 1990 Act. There is also the interaction with the court action involving the petty patents in question.
As can be seen from the summary of the submissions put to me at the hearing, in deciding the adjournment requests I am confronted with a range of viewpoints. The informants do however rely on basically the same grounds. Given the submissions, it is clear to me that a number of issues arise relevant to a decision in this matter. I will deal with these in turn taking relevant submissions concerning these issues into account.
1. Adjournment power
Subregulation 22.23 (2) gives the Commissioner power to adjourn a hearing and it is with regard to that provision that the informant parties have sought an adjournment in this case.
If a party wishes to be heard on an adjournment request it has made, the remarks of Mr Justice Ryan of the Federal Court on 16 December 1991 in Nakamura-Tome & Others v. Commissioner of Patents & Anor are relevant:
".... I consider that the Commissioner is obliged to afford a hearing in conformity with the requirements of such of the rules of natural justice as may be applicable in respect of Nakamura's request for an adjournment of the hearing which, but for his Honour's order, would have proceeded today."
I also note earlier remarks in the judgement concerning the operation of regulation 22.22 and its effect on the exercise of discretion afforded under subregulation 22.23 (2). Those remarks are these:
"However, I do not take the view that the discretion to hear an application, for and if thought fit grant, an adjournment involves the exercise of a discretion of the kind contemplated by Reg. 22.22. That regulation provides: .......
In my view, at least as presently advised, that regulation prescribes a procedure to be followed by the Commissioner before exercising a discretion which is capable adversely of effecting the substantive rights of a person. It does not apply to discretionary decisions of a procedural nature one of which is contemplated by regulation 22.23 (2) ....."
The parties have exercised their right to be heard on the adjournment requests. As I have so heard the parties, I am free to decide the adjournment requests and exercise my discretion pursuant to subregulation 22.23 (2).
2. Reasonable opportunity to be heard
The informant parties argued that the requirement in subsection 69 (3) to afford a party a reasonable opportunity to be heard means that the principles of natural justice apply. In assessing the merits of the application of those principles to the present situation, I note the following comments in the Hallsbury reference mentioned by Mr Macaw :
"A person or body determining a justifiable controversy between parties must give each party a fair opportunity to put his case and to correct or contradict any relevant statement prejudicial to his view. (p.93).
.
.Where there is an express or implied obligation to conduct an oral hearing, it is contrary to natural justice to fail to give a party any opportunity of being heard at all on a relevant issue, or to prevent him from calling evidence, or to preclude him or his advocate from addressing the tribunal or making submissions. It may also be contrary to natural justice to refuse an adjournment requested by a party who needs further time to prepare his case or to produce evidence." (p.94).
Furthermore, I note the remarks of the High Court in the Kiao case (supra) regarding procedural fairness, for instance those of Mr Justice Mason:
"The law has now developed to a point where it may be accepted that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention. ...... (p.584)
.
.When the doctrine of natural justice or the duty to act fairly in its application to administrative decision-making is so understood, the need for a strong manifestation of contrary statutory intention in order for it to be excluded becomes apparent. The critical question in most cases is not whether the principles of natural justice apply. It is: what does the duty to act fairly require in the circumstances of the particular case? It will be convenient to consider at the outset whether the statute displaces the duty when the statute contains a specific provision to that effect, for then it will be pointless to inquire what the duty requires in the circumstances of the case, unless there are circumstances not contemplated by the statutory provision that may give rise to a legitimate expectation. However, in general, it will be a matter of determining what the duty to act fairly requires in the way of procedural fairness in the circumstances of the case. A resolution of that question calls for an examination of the statutory provisions and the interests which I have already mentioned." (p. 585)
It seems to me from the above remarks that Mr Catterns has a valid point when he says that the principles of natural justice and fair practices placed on decision-makers depends very much on the nature of the proceedings and legislative framework. That being the case, I believe I need to consider the following question: Does the legislation in any way limit the extent to which the principles of natural justice should operate in this case? I therefore need to consider the relevant legislation dealing with the extension of term of petty patents.
3. Petty patent extension of term legislation
The relevant legislation concerning the extension of term of a petty patent is that in sections 69 and 28 and corresponding regulations 6.5, 6.6, 2.6 and 2.7, the texts of which I have included earlier in this decision. It is clear from section 68 that the term of a petty patent is only for a period of 12 months from sealing unless an extension of term is granted. It is also clear from subsection 69 (1) that a patentee has to apply for an extension of the term of its petty patent, making such application within 11 months of sealing (subreg 6.5 (1)).
Under section 28, a person may notify the Commissioner of grounds affecting the validity of a petty patent, the relevant grounds being specified in subsection (1). Any notice for this purpose must be filed within a period of 11 months from the sealing of the relevant petty patent (regulation 2.6). Regulation 2.7 requires that, in certain instances, particular documents must be with the notice. Subsection 28 (2) requires the Commissioner to inform the patentee of any matter of which he is notified, that is, in view of subsection (3), notified under subsection (1). Under subsection (3), the Commissioner must inform the patentee of any matter of which he has become aware other than by notification under subsection (1) and which may affect the validity of the petty patent.
When a patentee applies for an extension of the term of the petty patent under subsection 69 (1), other provisions of section 69 have effect. Of relevance for the purposes of this decision are subsections (2) to (4) which require the Commissioner to do certain things in deciding the application. The Commissioner must:
(a)decide the extension application in accordance with the regulations (s. 69(2)),
(b)not grant the extension without giving each person who has filed a notice under section 28 a reasonable opportunity to be heard (s. 69(3)), and
(c)not refuse to grant an extension unless the applicant for the extension has been given a reasonable opportunity to amend the patent request or complete specification, or both (s. 69(4)).
Regarding requirement (a), under subregulation 6.6 (1) the Commissioner must consider "any notice under subsection 28 (1) .... in relation to the petty patent" and "any matter of which the Commissioner has informed the patentee under subsection 28 (3)".
Apart from the obligations on the Commissioner mentioned in the preceding paragraph, there is another arising from subsection 216 (1) and subregulation 22.22 (1). Additional to the requirement in (c) above, it is clear that the Commissioner must not refuse to grant an extension without first giving the applicant for the extension a reasonable opportunity to be heard.
Whilst the provisions concerning the extension of term of a petty patent in the 1990 Act and the Regulations are in a somewhat different format to those in the former legislation, in my view the overall effect is the same. As I see it, the main differences between the two pieces of legislation arise in subsection 69 (4) and subregulation 6.5 (2) to which there were no equivalents in the former legislation. To me, the first difference benefits a patentee in that the Commissioner must allow an applicant for an extension an opportunity to amend the petty patent to avoid invalidity grounds rather than refuse to grant an extension, while the second difference has the effect of notifying the public that an extension of term is sought for a particular petty patent. (In actual fact, in administering the former legislation the Commissioner did what these two provisions now legislate him to do.) On my assessment of the present legislation, a person who files a notice under section 28 is in no different a position to one who filed a notice under subsection 68B (3) of the Patents Act 1952 ("the 1952 Act"). The former legislation in the subsection mentioned also allowed a person to "inform" the Commissioner by notice of matters that may affect the validity of the petty patent "at any time within 11 months after the sealing of a petty patent".
In both the Vulcan case (supra) and in the later Wright case (supra) I had occasion to consider what was required of a person within the terms of subsection 68B (3) of the 1952 Act. I also considered submissions regarding the admissibility of evidence filed by an informant beyond 11 months from sealing. I said this in the Wright case:
"In my view the Patents Act and the regulations permit an informant to provide to the Commissioner within 11 months of the sealing of the Petty Patent the notice under sec. 68B (3) together with a statement of facts including any supporting evidence (see Vulcan Australia Limited v Braemar Appliances Pty Ltd (1986) AIPC 90‑269; (1986) 6 IPR 143). The question of the admissibility of evidence provided by the informant after 11 months, or provided by the patentee beyond any time period allowed by the Commissioner, is a matter to be determined given the circumstances and merits of each case."
Under the former legislation, the Commissioner adopted a consistent practice regarding the requirements of a person giving notice under subsection 68B (3). Basically the informant had to provide all relevant facts and any supporting evidence within the period 11 months from sealing. Any notice or evidence not lodged within that period meant that either there was no valid notice or the evidence was not part of the notice - the extension of time provisions (then section 160) were however available to seek to extend the time to file a notice. Any evidence or material not forming part of the notice (eg. late-lodged evidence) could however be "admitted" and considered under then subsections 68B (5), (6) and (7) which required that the Commissioner shall consider all material which has been brought to his attention (see eg. Komesaroff v. Mizzi 9 IPR 457 at 458 and 464; Re Application by Thomas and Stohr 21 IPR 55 at 56). This practice recognises that situations may arise where evidence may be placed before the Commissioner at a late stage in the extension of term action, evidence which the Commissioner will be required to consider. In arriving at this practice, the Commissioner considered the legislation overall as is evident from the decisions in, for example, the Schmidt case (supra) and the Vulcan case (supra).
As I have already said, the present legislation in its overall effect is in my view the same as the former legislation regarding the extension of term of a petty patent. That being the case, it follows that the practice referred to in the previous paragraph should continue to apply to the present legislation.
The informants in this action have however raised the issue of whether they should be afforded time in order to consider and prepare reply evidence or further evidence. In arriving at the practice requirements mentioned previously regarding the former legislation, the Commissioner took the view that an informant had no inherent right under that legislation to consider any evidence filed by the patentee and then file reply evidence thereto or to file additional evidence to support the notice. I need to review that position to determine whether it is still an appropriate position for the Commissioner to take.
To my mind, section 28 however viewed with the other provisions concerning an extension of term of a petty patent, does not provide an "opposition" to an extension of term in the sense of oppositions as dealt with in Chapter 5 of the regulations. It is more accurately described as an informant action. Moreover, compared with the extensive opposition procedures in the regulations, it seems clear to me that the legislators in framing the legislation intended there to be a difference between actions involving a person informing the Commissioner of validity issues regarding a petty patent and a person opposing the grant of a standard patent under section 59. Apart from the right of a person to file a notice under subsection 28 (1), the only other clear rights of that person (an informant) are those provided by subsections 69 (3) and (8).
Under the legislation the Commissioner can consider and decide an extension of term application under subsection 69 (2) when the period of 11 months from sealing has passed. Indeed, I believe it is in the patentee's interest, if not the public interest, for the Commissioner to so do, since any uncertainty concerning the petty patent and its effect once the initial term has expired can be minimised. The Commissioner could therefore afford an informant its right to be heard immediately after that 11 month period has passed. For the sake of administrative convenience and with a view to enabling a speedy resolution of the matter, the hearing afforded an informant, where a notice has been filed, and that afforded the patentee are usually combined. However, before setting a hearing, the Commissioner (pursuant to regulation 22.24) often first affords the patentee an opportunity to respond to material in a section 28 notice - to do otherwise, depending on the material in the notice, may deny the patentee natural justice in defending its patent on alleged grounds of invalidity. Any evidence the patentee files in support of its patent and its extension of term application is, in my view, for the benefit of the Commissioner in deciding the extension - the fact that copies of patentee's evidence are or may be given to an informant does not, in my view, enliven any right for the informant to file reply evidence or additional evidence.
There may be circumstances when in deciding the extension the Commissioner feels that he requires particular evidence on an issue - a situation that comes to mind could arise where the validity ground of paragraph 28 (1) (a) is at issue and where the material before the Commissioner is inconclusive to establish the proper ownership of the patent rights. In such circumstances the Commissioner could give an appropriate notice to either an informant or patentee under regulation 22.14. That action by the Commissioner is, however, to be distinguished from matters and situations referred to in the previous paragraph.
There is a further point relevant to the operation of the legislation and that concerns hearing a person who is entitled under the Act to be heard. Regulation 22.23 refers to hearings. It allows for the Commissioner to hear parties in person or via telephone. Furthermore, it allows a party to a hearing who does not wish to appear at the hearing to make written submissions to the Commissioner before the hearing begins, submissions to which the Commissioner must have regard. The nature of regulation 22.23 gives a party a right to be heard either verbally or via written submissions - to my mind, it therefore limits a party "to be heard" in that manner. It seems to me that when subsection 69(3) is read in conjunction with regulation 22.23, these provisions only allow an informant a right to present verbal or written submissions and does not suggest to me any right to file evidence within the context of a right "to be heard".
In my view, the legislation does limit an informant in what it is entitled to do and in how it is to be heard regarding petty patent extension of term actions. The legislation, in my view, places the onus on an informant who alleges grounds of invalidity against a petty patent to provide to the Commissioner within 11 months of sealing all relevant material to support its allegations. Against the overall framework of the petty patent legislation, in according procedural fairness to an informant and a "reasonable opportunity to be heard", I cannot agree that this requires the Commissioner to afford the informant an opportunity to locate, review and file more evidence, whether it be reply evidence to that of the patentee or additional evidence. Afterall, the informant is not a person who is unaware of the action on which it has been invited to be heard, or who has not filed any material - it has filed its notice under subsection 28(1) and thereby has enlivened its right to be heard under subsection 69 (3). In my view, if the Commissioner affords an informant adequate time to prepare for the hearing and allows the informant to freely express verbally at the hearing, or via written submissions if it does not attend the hearing, its reasons in support of its allegations regarding grounds of invalidity of the petty patent, then the Commissioner has exercised adequate procedural fairness to the informant.
According I do not consider the practice requirements as applied to the former legislation demand any change when applied to extension of term procedures for petty patents under the 1990 Act.
4. More time to prepare and file additional evidence
In view of my conclusions under the previous heading, I decide that an adjournment of the substantive hearing on the extension of term applications to enable an informant to consider and perhaps file either reply evidence to the patentee's evidence or additional evidence is not appropriate. In so deciding, I believe that the parties have not been denied any necessary procedural fairness that the legislation on extension of term of petty patents requires the Commissioner to observe.
5. More time to prepare for hearing
Mr Catterns concedes that an adjournment on the grounds that a party needed more time to prepare for a hearing had merit. Clearly, what constitutes an adequate time to prepare for a hearing depends on the particular circumstances. Regulations 22.22 and 22.23 require the Commissioner to give persons at least 10 days notice of a hearing. It seems to me that in most cases, ten days notice would allow sufficient time for a party to prepare for a hearing.
In this case, there is no denying that the petty patent specifications at issue are lengthy and that the subject matter is of some complexity. Most of the informant material is also lengthy since it includes numerous patent specifications and trade brochures - all informants except FANUC essentially rely on the same material. The informants submit that they need more time to prepare for the hearing because they have to digest the 500 odd pages of material filed by the patentee. From the submissions, most informants received this material at their respective addresses for service in Australia in mid November 1991, about a month prior to the hearing date that was originally set, which to me seemed to afford those parties adequate time to consider and understand it. However, leaving aside the patentee's material, I think the notice of the hearing that was given to the parties in this case, namely 10 days, was too short even to allow the parties to review their own material and the specifications at issue and to prepare to be heard. It seems to me that had one month's notice been given of the hearing in this case, the informants could not have reasonably argued a denial of natural justice in preparing for the hearing. A month should have provided them with adequate time to fully prepare for the hearing, including sufficient time to engage and brief counsel if they desired such representation at the hearing.
With the delay in commencing the main extension of term hearing due to the adjournment action, all informants have now had additional time to review all relevant material and prepare for the hearing. Thus, if an adjournment is not appropriate on any other grounds, I feel that at least 14 days notice of the new hearing date for the main hearing would constitute a reasonable adjournment overall to enable the parties to prepare for the rescheduled hearing.
6. Adjourn due to pending court appeal
I need also to consider whether to adjourn the extensions hearings until the Federal Court appeal is decided. Basically, the informants have submitted that it is "inappropriate" for the Commissioner to proceed with the extensions hearings while the court appeal is pending. YAMAZAKI has placed counter submissions before me, suggesting there are no compelling reasons why its extension applications should not be considered and decided notwithstanding the appeal action.
There are several factors relevant to the consideration of an adjournment given the pending court appeal which I will now discuss.
(i) Patent Office Practice
Mr Kildea, and several other informants, referred to the practice of the Commissioner declining to take certain actions on say a patent application when that application is the subject of court proceedings. To a certain extent that is the case, however whether the Commissioner declines to act depends very much on the circumstances. The instances Mr Kildea referred to in his written submission serve to illustrate that point.
Mr Kildea refers to one situation where an appeal was pending on a decision by the Commissioner in respect of opposition to the grant of a patent, and where the applicant had requested leave to amend its specification. The Commissioner took no action on the request while the appeal was pending. The Commissioner has a similar practice today in such situations although he is prepared to consider the request but not grant leave to amend or advertise the request until the court action is resolved - this practice is consistent with the requirements of section 112 involving a patent which is subject to court proceedings. The other instances referred to by Mr Kildea are rather special situations, and are of little assistance in supporting a particular practice in the circumstances here. There have been other occasions in recent years where the practice to which Mr Kildea refers has been followed. For instance, I am aware of several separate occasions where a person requested the Commissioner to direct a change of patent applicant or record an interest in a patent. The Commissioner had doubts concerning the entitlement or interest and sought additional evidence. In the meantime the Commissioner became aware that court proceedings had been initiated, the outcome of which would determine the interests in the application or patent. In those circumstances the Commissioner declined to further action the matters, choosing to wait for the outcome of the court proceedings. There were no objections from the parties to this course of action.
(ii) Previous concurrent extension action/ court action
NAKAMURA's written submission refers to 2 cases where the Patent Office heard and decided on a petty patent extension while concurrent infringement/revocation action was before a court. In the Gerber Scientific case (supra), the Court delayed hearing the action before it pending the Patent Office decision on the extension of term. In the Lakecroft case (supra), a hearing for the extension of term matter was set for a date before the court hearing. The patentee intended to apply to the court to amend its petty patent (and related standard patent) and requested that the hearing before the Commissioner be adjourned since it wanted to make submissions at the extension hearing based on its (hopefully) amended specification. The Commissioner declined to adjourn the hearing and indicated that the hearing would allow him to at least hear the informant - the Commissioner felt that the patentee need not necessarily attend the hearing, and if need be, could be heard at a later date. In the event, the patentee attended the hearing and the Commissioner determined that the claim before him lacked novelty. The Commissioner also felt that it may be possible to amend the specification to claim a patentable invention, but amendment was not possible with the court action pending. Accordingly the Commissioner decided to defer further action in the extension matter while the court action was pending. The court subsequently allowed the petty patent specification to be amended, and in due course the Commissioner granted an extension of the term of the petty patent based on the amended claim.
I understand that there have been several other petty patents both before the Commissioner on extension of term action and involved in court proceedings as to infringement or revocation. In each instance, however, I further understand that the court actions had not progressed to a hearing stage prior to the Commissioner deciding on the extensions.
(iii) Authorities referred to by the parties
NAKAMURA, YAMAZAKI and FANUC referred in their submissions to a number of court judgements to support their respective positions on adjournment while the court appeal is pending. Having considered those references, I do not believe that they establish a basis for the Commissioner to follow a particular course of action in the present circumstances.
I fail to see that if the Commissioner proceeds to hear and decide the extensions this will necessarily lead to contempt of the Federal Court. The Commissioner is authorised and required under the legislation to decide on the extension of term of a petty patent, and in performing that function the Commissioner's action is unlikely to be a contempt (see eg. the Lockwood case (supra)). Also, I cannot see that for the Commissioner to proceed to hear this matter will of itself either affect or be likely to affect the due administration of justice of the court. It seems to me, and I make no definite assessment of this issue here, that the Commissioner may in fact be constrained in what matters he can consider and needs to decide at the extensions hearing whenever it takes place, given the matters already decided by the court - an estoppel may apply. If that is the case, the likelihood of a decision arising from the Commissioner which is in conflict with issues decided by the court is remote.
The Thornton case (supra) involved a delay by the Repatriation Commission in deciding a pension claim. The Commission deferred making a decision until judgement was handed down in an appeal to the High Court of Australia on a similar matter involving a different person. Whilst this case is of some interest for present purposes, I do not feel that it greatly assists me in deciding on an adjournment given the facts and circumstances before me.
(iv) Interests
The informants have suggested that to proceed with the extensions hearing before the court appeal is decided could lead to wasted effort and resources by all parties and be against all parties best interests. It is also suggests that to adjourn would not prejudice the patentee but no adjournment would prejudice all parties. YAMAZAKI however clearly believes its interests are best served by having its extension applications decided as soon as possible, presumably because it considers that it may be able to gain an injunction against any infringers if the extensions are granted. It is perhaps not surprising that YAMAZAKI holds that belief, afterall it has a court judgement in its favour on infringement and validity issues concerning its petty patents and, as I understand it, wishes to gain the full benefit of its monopoly rights. YAMAZAKI submits that actions by certain persons since the initial terms of the patents expired would constitute infringement if the terms were extended and the patents were not found invalid on the appeal.
In my view, these interests are relevant in considering whether or not to adjourn because of the pending court appeal.
(v) Other matters
Mr Kildea referred me to a paragraph of Mr Justice Gummow's reasons for judgement where he notes the extension of term applications for the petty patents and states:
"...... but the Commissioner has not determined whether the extensions should be granted having regard, in particular, to the challenge to the validity presented on the cross-claim which is before this Court."
In view of this passage, Mr Kildea submits that Mr Justice Gummow approved of the Commissioner not determining the extensions while the validity matters were before the Court, and further submits that the same holds true given the appeal.
Whether Mr Kildea is right in his interpretation of the passage quoted is highly debatable. As I see it, Gummow J. is merely stating what he understood the situation to be, and I cannot read into the passage any "approval" or otherwise. In actual fact, the Commissioner was not in a position at the time of the hearing before Gummow J to hear and decide the extension applications since the relevant administrative actions associated with the requirement of subsection 28 (2) had not been fulfilled. In my view, I do not see the passage quoted as implying that the Commissioner should follow a particular course with regard to the extension applications now that the appeal is pending.
Apart from the authorities to which I have been referred by the parties, I am not aware of any other references or authorities to assist me in deciding on an adjournment because of the pending court appeal.
(vi) Conclusion on this issue
In the circumstances before me, were the patentee in favour of an adjournment of the extension of term matters until after the court appeal is determined, I would not hesitate in deciding to adjourn the extensions hearing. It is easy to appreciate some advantages arising from that course of action given that one matter can be resolved before the other. However, the patentee is against such an adjournment for various reasons, none the least being related to its interests in benefiting from the patents.
If the extensions hearing were to proceed before the court appeal is finalised, there is a risk that the hearing and efforts by the parties and the Commissioner may be in vain particularly if the court rules the petty patents invalid. Against that however is the possibility that if the extension matters are adjourned until the court appeal, and any subsequent appeal, is finalised, significant delay may result in bringing the extensions to hearing. Such delay is unlikely to be in the patentee's interest or in the public interest given the continuing uncertainty about whether the terms of the petty patents will be extended.
It is not easy to weigh up the various interests in this matter. On the one hand, it is all too simple to conclude that as there are 7 informants, their collective interests should hold sway over those of the patentee. Each informant has filed a section 28 notice and their interests derive from those notices. Apart from that, 3 informants are involved in the concurrent court matters and so other interests arise for them given those matters. All informants however feel that the court appeal should be finalised before the Commissioner proceeds with the extension actions. If the extensions hearing is not adjourned, it seems to me that the most the informants may suffer is some inconvenience, if they still choose to be heard on their section 28 notices. As to the 3 informants involved in the court appeal, I do not see that they lose any rights in that action if the extensions hearing proceeds.
On the other hand, the patentee clearly has a concern about benefiting from petty patents which have been argued before a single judge of the Federal Court on invalidity grounds (on the basis of material also placed before the Commissioner in 6 of the section 28 notices) but which were found valid and infringed. For the patentee to be in a position to fully benefit, the petty patents first need to have their terms extended, and only the Commissioner has the power to decide the extensions. As I understand it, a court will not entertain an application for an injunction against those parties held to be infringing the petty patents until the terms of those patents have been extended. Thus the patentee cannot seek an injunction before the extensions are considered, and until that time no-one (including any of the informants) can be restrained from exploiting the inventions of the petty patents - patents which a court has not only declared valid, but also infringed by some of the present informants. If the term of each petty patent is extended, a court will have to decide any application for an injunction to restrain infringement on its merits. It seems to me that prejudice will result to the patentee if, as a consequence of inaction on the extension of term applications, it is unable to even seek an injunction from the court which has found its petty patents valid. If the extensions hearing were to proceed and the extension applications decided in favour of the patentee, the informants (or some of them) may subsequently suffer prejudice in their commercial activities but only if the patentee can convince a court that an injunction restraining infringement should issue, and then only if the patents are subsequently found to be invalid by the court. Thus any such prejudice to the informants does not immediately arise upon hearing and deciding the extension applications.
Given the interests and possible prejudice referred to, in my view the Commissioner has a duty to act in a way which leads to minimal prejudice arising to the respective parties. I can see no legitimate hindrance to the Commissioner proceeding with the extensions hearing while the court appeal remains unheard and undecided. It seems to me that to proceed with the extensions hearing rather than await first the court appeal outcome gives rise to least prejudice to the parties. Furthermore, bearing in mind the various interests, if the petty patent provisions are to operate in a worthwhile manner in the present circumstances, I believe that to proceed with the extensions hearing is not an unreasonable course to follow.
Accordingly, I have decided that an adjournment of the extensions hearing to await the outcome of the court appeal is not justified.
CONCLUSION
On the adjournment requests by the various informants I have decided as follows:
That an adjournment of the substantive hearing on the extension of term applications to enable an informant to consider and perhaps file either reply evidence to the patentee's evidence or additional evidence is not appropriate.
That an adjournment of the extensions hearing for the purposes of preparing for the hearing is justified.
That an adjournment of the extensions hearing to await the outcome of the court appeal is not justified.
Given my decision, the hearing of the extension of term applications needs rescheduling. As avenues exist enabling any party to seek to have my decision reviewed by another authority, I consider that the hearing should not be rescheduled within the time period normally available in which to instigate such a review. Accordingly (and subject to the instigation of any such review), pursuant to subregulation 22.23 (1) I hereby notify all the parties involved in this action that the hearing of the extension of term applications will commence at 10.00 am on Monday 30 March 1992 in Hearing Room 1, 12th Floor, Scarborough House, Woden, ACT.
(T R BRUHN)
Delegate of the Commissioner of Patents
REPRESENTATION AND APPEARANCES OF THE PARTIES
Patent Attorneys for YAMAZAKI: Griffith Hack & Co, Sydney
Solicitors for YAMAZAKI: Freehill Hollingdale & Page
Appearances : Mr D K Catterns of counsel
Ms E Grinston, solicitor
Mr C J O'Sullivan, patent attorney
Mr Fujiwara of YAMAZAKI.
Patent Attorneys for NAKAMURA: Davies Collison Cave, Melbourne
Solicitors for NAKAMURA: Davies Ryan De Boos
Appearances : Mr R C Macaw QC and Mr G C McGowan of counsel
Mr R Jarvis, solicitor
Mr K Leslie, patent attorney
Mr Kitamura of NAKAMURA.
Patent Attorneys for MIYANO: Davies Collison Cave, Melbourne
Appearances : Mr G C Pryor, patent attorney.
Patent Attorneys for IMT and INTERACT: Phillips Ormonde & Fitzpatrick, Melbourne
Appearances : Mr G L Cowin, patent attorney.
Patent Attorneys for TAKISAWA: Callinan Lawrie, Melbourne
Appearances : Mr G L Cowin, patent attorney, as agent.
Patent Attorneys for FANUC: Patent Attorney Services, Melbourne
Appearances : Mr P F Kildea, patent attorney, as agent.
Patent Attorneys for MORI: Carter Smith & Beadle, Sydney
Appearances : Mr R G Shelston, patent attorney.
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