FEDERAL COURT OF AUSTRALIA Alphapharm Pty Ltd v Beecham Group Plc [2001] FCA 713 ALPHAPHARM PTY LTD v BEECHAM GROUP PLC & ORS N229 of 2001 EMMETT J 13 JUNE 2001 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N229 OF 2001 BETWEEN: ALPHAPHARM PTY LTD APPLICANT AND: BEECHAM GROUP PLC FIRST RESPONDENT AND: SMITHKLINE BEECHAM PLC SECOND RESPONDENT AND: SMITHKLINE BEECHAM (AUSTRALIA) PTY LTD THIRD RESPONDENT JUDGE: EMMETT J DATE OF ORDER: 13 JUNE 2001 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. Directions will be made on Friday 15 June 2000, in accordance with the short minutes proposed by Alphapharm on 6 June 2000, unless further submissions are made by the respondents concerning the date for filing any cross-claim by that time. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N229 OF 2001 BETWEEN: ALPHAPHARM PTY LTD APPLICANT AND: BEECHAM GROUP PLC FIRST RESPONDENT AND: SMITHKLINE BEECHAM PLC SECOND RESPONDENT AND: SMITHKLINE BEECHAM (AUSTRALIA) PTY LTD THIRD RESPONDENT JUDGE: EMMETT J DATE: 13 JUNE 2001 PLACE: SYDNEY REASONS FOR DECISION 1 Pursuant to directions that I gave on 6 June 2001, draft directions have been filed by each of the parties. There are two matters in respect of which the parties are at issue, namely, cross claims and costs. Cross Claims 2 In the proceeding, Alphapharm seeks declarations that three Australian patents are invalid and orders that they be revoked. The respondents are the parties interested in maintaining the patents. Alphapharm seeks a direction concerning the filing of a cross claim by the respondents relating to any allegation of infringement of the patents by Alphapharm. 3 The respondents have obtained material under Order 15A relating to possible infringement of the patents but, at present, they have given no instructions to commence proceedings for infringement of the patents. On 27 April 2001, counsel for the respondents said that it would take something of the order of four to six weeks to complete test results and trials, and then initiate infringement proceedings. 4 It is a matter for the respondents as to whether and when they commence infringement proceedings. They may do so by means of a cross claim in the present proceeding or by a fresh proceeding. It is usually convenient for infringement proceedings between a patentee and a party seeking revocation to be heard at the same time as the revocation proceeding. However, that is not always necessarily so. 5 It is in the public interest that a revocation proceeding be brought to finality with reasonable expedition. If infringement claims can be dealt with at the same time without hindering the progress of the revocation proceeding, that may be a convenient course. Nevertheless, the possibility that infringement proceedings may be commenced should not normally be allowed to interfere with the progress of a revocation proceeding. 6 In my view, the respondents should be given a reasonable opportunity to file any cross-claim alleging infringement. If within such a reasonable time no cross-claim has been filed, I would not be disposed to permit a cross claim to be filed in the proceeding. If, subsequently, separate proceedings for infringement are instituted, it would be convenient for those proceedings to be assigned to my docket. If Alphapharm contended that it would be oppressive for it to have to deal with the preparation of both proceedings at the same time, it would then be a matter for Alphapharm to persuade me, if it wished to do so, to stay the infringement proceeding until after the completion of the revocation proceeding. 7 Alphapharm proposes that any cross-claim be filed no later than 19 June 2001. Unless the respondents indicate no later that Friday 15 June 2000 that they need more time to formulate any proposed cross-claim, and explain why, I propose to direct that the respondents file and serve any cross-claim by that date. As I have indicated, however, the consequence of not filing a cross-claim by that date is that any infringement proceeding would be separate from the current proceeding. Costs 8 On 27 April 2001 I gave directions for the filing of an amended application and an amended statement of claim. I also ordered Alphapharm to pay the respondents' costs thrown away by reason of that amendment. Under Order 62 rule 3(3) a bill in respect of those costs would not be taxed until after the completion of the proceeding unless I otherwise order. The costs do not appear to me to be of such significance or the circumstances leading to the amendment of such egregiousness that the ordinary rule should be departed from. At this stage I am not prepared to make an order under the rule. Declinature at this stage, however, would not preclude a further application at a later stage if circumstances change. I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Decision herein of the Honourable Justice Emmett. Associate: Dated: 13 June 2001