CATCHWORDS TRADE PRACTICES - application for interlocutory relief in reliance on s.52 Trade Practices Act 1974 - juvenile apparatus marketed by both applicant and respondent - pending Australian patent application relied on by applicant - whether applicant exclusive licensee - s.54C Patents Act 1952 - whether applicant another person within the meaning of s.80(1) of the Trade Practices Act 1974 and thereby entitled to bring attention to alleged patent infringement by respondent - balance of convenience. Trade Practices Act 1974, ss.52, 80(1) Patents Act 1952, $.54C ONCORDE. ING . LIMITED v. CRONER TRADING PTY. LIMITED No. G438 of 1987 FOX J. 25 SEPTEMBER 1987 SYDNEY FEDERAL COURT QF AUSTRALIA PRINCIPAL REGISTRY IN THE FEDERAL COURT OF AUSTRALIA )} ) NEW SOUTH WALES DISTRICT REGISTRY ) NO. G438 OF 1987 ) GENERAL DIVISION ) BETWEEN: CONCORDE TRADING PTY.LIMITED Applicant AND: CRONER TRADING PTY.LIMITED Respondent MINUTE OF ORDER JUDGE: FOX J. DATE _OF ORDER: 25 SEPTEMBER 1987 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The application be dismissed. Note: Settlement and entry or orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) NO. G438 OF 1987 ) ) GENERAL DIVISION BETWEEN : CONCORDE TRADING PTY. LIMITED Applicant AND: CRONER TRADING PTY. LIMITED Respondent CORAM: FOX J. DATE: 25 SEPTEMBER 1987 REASONS FOR JUDGMENT EX _TEMPORE FOX J. In this matter the applicant seeks interlocutory relief primarily in reliance on 8.52 of the Trade Practices Act 1974. It markets a piece of juvenile apparatus known generally asa jump ball under the name of "LoLo". It would seem that it is not in a big way of business so far as the sale of this item is concerned, but is rather waiting to make use, if it can, of an alleged invention to which I will refer. The respondent is actively engaged in selling a similar ball under the name of "GoGo" for which it has a large sale. The ball appears to be imported from overseas, from Taiwan, and possibly other countries. The apparatus bears some resemblence to what I think was known as a Pogo stick, except that there is no. stick. It comprises a strong plastic ball which is placed tightly in the centre of a strong and firm jump ring. The idea is that the operator jumps onto the plate or ring surrounding the ball, causing its compression and subsequent inflation, and this naturally results in a bounce. About 20 centimetres or so of the respondent's ball protrudes underneath the jump plate, and is of about the same height above it. The plate, which is circular, extends outwards to about twice the diameter of the internal ring, taken from the circumference of the latter. There is an obvious necessity to ensure that the outside ring does not slip down over the ball when force is placed on it thus frustrating the operation. The respondent has a lip on its ball to minimise this risk, and the invention in question is by slightly different means designed to achieve the same end. Put shortly, it provides either for a recessed portion of nearly a centimetre in width around the circumference of the ball or. alternatively, a series of protrusions on it which fit firmly into corresponding slots in the internal part of the plate. In argument counsel for the applicant put its case in two ways. I think the case appears somewhat differently in the pleadings as amended, but what I have to say encompasses the matters whether one looks to the pleadings or to the argument. The first way the matter is put is that with reference to s.54C of the Patents Act 1952 the applicant claims to be an exclusive licensee in Australia of the invention to which I have referred. The chain of title to this licence is said to derive from an assignment executed in Holland by the inventor, a Mr Blankenzee, to a Dutch company, [International Anhydrite Corporation N.V ("IAC"), and a subsequent licence to the applicant from the last mentioned company jointly with a sister company Global Guaranty Distribution SA ("Global Guaranty") also of Holland. It was not explained, nor does it appear from the evidence, how Global Guaranty came to be a joint licensor with IAC when the only assignee was the last mentioned company. There would seem to have been some intervening transaction, although the matter may simply be explained on the basis of a close link between the two companies. I interpolate that Mr Blankenzee is not a@ party to the proceedings, and his wishes and intentions have not been put before me. It seems to me that at this stage at least the claim thus put must fail, if for no other reason, because the subject of the assignment and of the licence are not clearly identified in the documents or by admissible extrinsic evidence. In fact the assignment to which I have referred predates what seems to be one of two applications for a patent lodged by Mr Blankenzee with the Dutch authorities relative to the same invention. It would seem that it is this later application of 2 October 1985 which is velied upon rather than an earlier one made on the date upon which the assignment was executed, namely 5 August 1985. These two applications were given different patent numbers in Holland. The agsiqnment and licences are to be construed and applied according to Dutch law, but there is no evidence on this subject before me and I. proceed to consider the subject on the basis of Australian law. The relevant documents insofar as they were originally Dutch have been before me in the form of translations. As I have indicated there are a number of difficulties about the chain of title, but even were it established the applicant could not thereby be given a monopoly in Australia of the right to make, use, exercise and vend the Dutch invention because this would require an Australian patent. In fact the inventor, Mr Blankenzee, lodged an application in Australia for a convention patent on 23 July 1986. There has not been a grant of any letters patent in Holland and the Australian application reached the point on 12 February of this year that the complete specification was open to public inspection. There has not yet been any acceptance of it by the Patent Office. There was tendered before me a document which I was told was a precise translation of the second of the Dutch applications, namely that of 2 October 1985. This was said entirely in good faith, but as counsel for the respondent has pointed out, it appears on the face of the translated document so-called that it is simply another copy of the Australian specification. It shows that it is the second of the Dutch applications upon which reliance is placed in the matter currently being proceeded with in Australia. In my view material has not been presented which would enable me to grant any interlocutory relief on the basis referred to. The next main submission is made in reliance in particular upon s.80(1) of the Trade Practices Act. It is argued that the applicant is another person within the meaning of this subsection, and as such entitled, at least in the public interest, to bring to attention the fact, as alleged, that the respondent is infringing the claims of the patent now made open for inspection. Accepting for the purpose of argument, but certainly not deciding, that the applicant has standing in this regard, there are in my view several aspects which preclude me from being satisfied at this stage that it has such a case as should justify the grant of an injunction. The making public of the complete specification is but a step on the way to obtaining Letters Patent. It is true that it is a distinct step and if Letters Patent are granted, Mr Blankenzee or possibly the applicant, if matters are appropriately put in order, can sue for damages from that date forward. I refer to 8.54C of the Patents Act. It is not, however, true to say that there is an infringement incurring from that date, at least not in any presently relevant sense. There are important intermediate stages which may prevent the alleged inventor ever obtaining a patent or being able to recover damages or other relief in respect of the alleged invention. There has, for example, to be the examiners approval and there is the opportunity for opposition and then defences are available in an infringement action which may lead to it being declared invalid. There has been evidence before me which throws some doubt on the validity of any patent granted in respect of the invention. In particular there is evidence of prior user and prior publication. Whether if a valid patent were granted the respondent's ball would be an infringement, appears to me on the evidence so far available, to be debatable. There is a distinct difference between the inventions claimed and the respondent's ball. It is said that the difference would only constitute a mechanical equivalent. On fuller examination this may prove to be so although the matter has not been explored in any depth before me. There is also a question of whether the respondent's ball is not simply an application of prior art. These matters of technical patent law which usually involve a deal of expert evidence have not been gone into in any detail before me or indeed sufficient detail to enable me to form firm conclusions. The difficulty about granting interlocutory relief when matters are contested in the way that I have mentioned has been well recognized for many years. In these circumstances it is difficult to see how the purchasers of the respondent's equipment, or members of the public will be misled or deceived by its sale. It is in fact sold by the respondent in a distinctive package but no case has been made out or presented on the basis of passing off. No reliance is placed on manufacture or sales by the applicant. There can also be no need, as it seems to me, for the respondent to give notice by label or otherwise to purchasers from it of Mr Blankenzee's pending application. As matters stand therefore I do not find that there is a sufficient case to justify any interlocutory relief. If I was satisfied that the applicant had a sufficient case I would turn to the question of the balance of convenience. On the evidence I do not think this can be said to fall in favour of the applicant. It has incurred expense in preparation for making and selling the ball according to Mr Blankenzee's specifications and if an injunction is not granted it is likely to lose the whole benefit of that money and of the market it has hoped to obtain. There is evidence that inquiries for some substantial number of halls were made of the applicant and tentative orders placed, but it was not able to provide samples and, of course, unable to accept the contracts. The respondent, on the other hand, has for some little time been selling large numbers of its balls and has established a reputation in that regard. If an injunction now goes it will be prevented from fulfilling some of the orders on hand and its business, of course, will be detrimentally affected. On the whole I am inclined to think that the balance of convenience is with the respondent although for reasons already indicated it is not necessary to come toa final conclusion on this matter. The real point is that there is not an obvious or heavy balance of convenience in favour of the applicant which could incline a court to accept evidence which is otherwise very frail. This is not to say that I think the evidence of the applicant comes up to, or satisfies even that description. If it be relevant, and it was mentioned once or twice in argument, I can say that I do not see any public interest in the respondent being required to cease selling or to give notice to its purchasers of the pending Australian application. T therefore dismiss the application. I certify that this and the seven (7) preceding pages are a true copy of the Reasons for Judgment herein of his Honour Mr, Justice Fox. S Rotana Associate: Date: 25 September 1987 Counsel for the Applicant: Mr T. J. Hancock Solicitors for the Applicant: Phillips Fox Counsel for the Respondent: Mr N. J. Young Solicitors for the Respondent: Minter Ellison Dates of hearing: Sydney: 22,23,24 September 1987 Date judgment delivered: Sydney: 25 September 1987