Bomac Research Limited v Merial Limited HC Wellington CIV 2009-485-2141
[2010] NZHC 618
•14 April 2010
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV 2009-485-2141
UNDER the Patent Act 1953
IN THE MATTER OF an appeal from a decision of the Assistant
Commissioner of Patents dated 28
September 2009
BETWEEN BOMAC RESEARCH LIMITED Appellant
ANDMERIAL LIMITED Respondent
Hearing: 14 April 2010
Counsel: I Finch for Appellant
G F Arthur for Respondent
Judgment: 14 April 2010
ORAL JUDGMENT OF MILLER J
[1] Bomac appeals an interlocutory decision of the Assistant Commissioner of Patents extending the time for Merial to file its statement of case in an application to revoke a Bomac patent. The patent is numbered 550279. It concerns an anthelmintic preparation used for administering veterinary medications and called Medicament.
[2] Merial did not oppose the patent, which was accepted on 31 January 2008 and sealed on 15 May 2008. But it applied for revocation of the patent on 15 May
2009. It was just within time, for s 42(1) of the Patents Act 1953 provides that the
application must be made within 12 months after sealing:
BOMAC RESEARCH LTD V MERIAL LTD HC WN CIV 2009-485-2141 14 April 2010
42 Revocation of patent by Commissioner
(1) At any time within 12 months after the sealing of a patent, any person interested who did not oppose the grant of the patent may apply to the Commissioner for an order revoking the patent on any one or more of the grounds upon which the grant of the patent could have been opposed:
[3] Regulation 104(1) of the Patents Regulations 1954 provides:
104(1) An application for the revocation of a patent under section 42 of the Act shall be made in form 45, and shall be accompanied by a copy thereof and a statement (in duplicate) setting out fully the nature of the applicant's interest, the facts upon which he relies, and the relief which he seeks.
[4] Merial’s application for revocation was made, as required, in form 45. However, it simply identified, in three pages, the patent and the grounds on which it was impeached. It was not accompanied by a statement of case setting out the nature of Merial’s interest and the facts upon which it relied.
[5] Under reg 168, the Commissioner of Patents may extend times:
168 The times prescribed by these regulations for doing any act, or taking any proceeding thereunder, other than the times prescribed by regulations 68, 81(1), 87(1), 92(1), 97(1), 108(1), 113(1), and 135(1) hereof, may be extended by the Commissioner, if he thinks fit, upon such notice to the parties and upon such terms as he may direct, and such extension may be granted although the time has expired for doing the act or taking the proceeding. An application for an extension of time under this regulation shall be made in form 76.
[6] It is now common ground that while this power does not extend to the time for filing an application for revocation under s 42, it does apply to the filing of a statement of case under reg 104.[1]
[1] Ancare New Zealand Limited v Ciba-Geigy New Zealand Limited AP55/95 6 June 1996 Elias J
[7] Together with its application for revocation, Merial filed an application for a two-month extension of time for filing a statement of case. The only circumstances relied upon were that Merial “requires more time to finalise the statement of case”.
[8] The Commissioner inquired whether Bomac consented to the extension of time. It did not. By letter of 16 June its patent attorneys, James and Wells, contended that as a full twelve months had passed since sealing, Merial had had
sufficient time. They observed that Merial is a major pharmaceutical company possessed of ample resources and with much experience in patent disputes.
[9] In a letter of 18 June, Mr Caulfield, the Australian patent attorney for Merial, advised that “significant progress has been made in preparation of the statement of case, but further time is required to finalise the statement and to obtain our client’s approval”. He added, as evidence of progress, that copies of the documents referred to in the application for revocation had been provided to the Commissioner and Bomac’s advisors. He sought a deadline of 15 July for filing the statement of case.
[10] The Commissioner wrote to the parties on 22 June, proposing to grant the extension. The Commissioner acknowledged that his published guidelines stated that he would allow a period of two months for filing a statement of case in a patent “proceeding”, which would cover a revocation proceeding or indeed any matter before the Commissioner where a statement of case was required. The Commissioner was surprised that the statement of case was not ready at the time of filing the application for revocation. But he accepted that there is a public interest in allowing time for pleadings to be completed and the guidelines did not clearly restrict the time for the filing of the statement of case.
[11] James and Wells responded by requesting a hearing on the decision to grant an extension of time. That was granted, and the hearing was held on 3 August 2009. The Assistant Commissioner delivered a judgment dated 28 September. In the meantime, Merial filed its detailed statement of case on 15 July.
[12] After reciting the background, the Assistant Commissioner referred to the guidelines, which provide that: reasonable periods for extensions are, for example, one month for opposing a patent and two months for filing a statement of case; when making a request for an extension of time, a party must give full and detailed reasons for the request explaining why it was not possible to complete the required action within the required time, advising the present status of the required action, identifying any actions needed to meet the deadline now sought, and providing an anticipated timetable; the extension of time guidelines were a guide only; and there
may be circumstances in which the Commissioner, in the exercise of his discretion, makes a decision contrary to them.
[13] The Commissioner referred to the judgment of Ronald Young J in Amadeus Global Travel Distribution SA v Sabre Inc,[2] and decided to allow the extension of time, for several reasons. First, the application was filed within 12 months of sealing, as required by s 42. Second, it was filed within two months after the application for revocation and the rules permit extensions. While the party requesting an extension should normally be required to justify it, some latitude must
be allowed for short extensions, particularly in view of the public interest in the hearing officer having all the information and evidence needed to make a proper decision. Third, the restrictions upon extensions of time spelled out in the guidelines were no more than a guide, intended to help ensure that excessive and unjustified extensions of time are not allowed. That was not the case here.
[2] Amadeus Global Travel Distribution SA v Sabre Inc HC Wellington AP{126/02, 14 March 2003.
[14] On appeal, Bomac sought leave to file an affidavit from Mr Caulfield. He explains, on the assumption that the High Court is unfamiliar with such matters, the exhaustive work that is typically involved in challenging a patent, and adds that the work in this case was not finalised before 15 May 2009. He also understands that it is standard practice in New Zealand to grant at least one two-month extension of time. Leave to file that affidavit is opposed.
[15] I have reservations about the affidavit in view of Mr Caulfield’s apparent conflict between interest and duty concerning this issue, and I observe that it could not be accepted without giving Bomac an opportunity to reply. But as it happens I do not find it necessary to consider the affidavit.
[16] Bomac makes two basic submissions. First, the burden of proof under reg
168 lies with the applicant, and “as a matter of natural justice” that party must give full and detailed reasons for the request and show diligence; further, decisions made in the absence of such evidence run the risk of being inconsistent and unprincipled. Second, Merial failed to provide such information notwithstanding the Commissioner’s own guidelines, so there was no evidential basis on which the
Commissioner could exercise the discretion to extend time. In oral argument Mr Finch added that the Commissioner erred by taking into account things that had been done since 15 May.
[17] I consider that the Assistant Commissioner was right, for the reasons that he gave. First, while Merial did not adequately explain its delay and manifestly took the extension casually, the guidelines were apt to lead it to think that a two-month delay in filing a statement of case is not normally considered unreasonable.
[18] Second, the proposition that as a matter of natural justice a party must give full and detailed reasons for its request is misconceived, a false premise on which Mr Finch seeks to pull himself up by his bootstraps. The obligation to afford natural justice is that of the Commissioner, who gave Bomac ample opportunity to be heard. The real issue is whether the discretion was exercised in error.
[19] As to that, the reasons for delay are always a relevant consideration, but it is not correct that they must invariably be supplied nor that they must withstand scrutiny. An applicant fails to explain itself at its peril, but the Regulations do not insist that it justify delay. Where, as in this case, the delay is short and the statement of case has been filed in the interim, it need not weigh heavily with the Commissioner even if not adequately explained. While the guidelines are no doubt useful, I respectfully agree with Ronald Young J in Amadeus that they cannot be applied prescriptively. The general question is whether an extension of time is in the interests of justice. The Assistant Commissioner correctly approached the application from that perspective in this case. He did not overlook the delay.
[20] Third, without the statement of case the application for revocation would fail without being considered on its merits. That consideration cannot be decisive, but it is powerful. The Commissioner correctly recognised that, as Ronald Young J put it in Amadeus:
[25] The confirmation of an application for a patent creates a powerful monopoly. There is significant public interest in ensuring that only those patent applications that can be justified are granted. Part of the process of verification or otherwise is a form of adversarial process which allows those who say a patent should not be granted to, by evidence, justify their
opposition. This is one, perhaps the most effective, way in which the integrity of the patents system is ensured. And it is vital to keep in mind that procedural law has as its ultimate justification the doing of justice between the parties. That will include expeditious hearing and proper exchange of information in a timely way. Most importantly, it will involve ensuring the parties put their best case forward. In this way the judicial officer will be in the best position to give his/her best decision.
[21] Lastly, there is, unsurprisingly, no evidence of prejudice to Bomac in
Merial’s delay.
[22] Mr Finch submitted that this leaves parties in a position of uncertainty as to how extensions of time will be handled by the Assistant Commissioner. It is true that they must be dealt with according to the interests of justice in particular circumstances and to that extent there is inevitably an element of uncertainty. But the important point is that an applicant who takes an extension for granted does so at its own risk. It would have been difficult for Merial to show that the Assistant Commissioner erred, had he refused the extension in this case.
[23] For all of these reasons Bomac has failed to satisfy me that the Assistant
Commissioner was wrong. The appeal is dismissed.
[24] Having succeeded, Merial is entitled to costs, and the proper basis of calculation is 2B. I accept Mr Finch’s submissions, that no allowance should be made for the affidavit of Mr Caulfield and the costs should be calculated on the basis that the hearing has taken half an hour. Mr Arthur accepts that the award should not extend to second counsel. Counsel will have leave to file memoranda if costs cannot be settled on that basis.
Miller J
Solicitors:
James and Wells, Auckland for Appellant
A J Park Law, Wellington for Respondent
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