FEDERAL COURT OF AUSTRALIA Inverness Medical Switzerland GmbH v MDS Diagnostics Pty Limited [2007] FCA 1296 INVERNESS MEDICAL SWITZERLAND GMBH v MDS DIAGNOSTICS PTY LIMITED AND MDS DIAGNOSTICS LIMITED NSD 1722 OF 2006 ALLSOP J 17 AUGUST 2007 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY NSD 1722 OF 2006 BETWEEN: INVERNESS MEDICAL SWITZERLAND GMBH Applicant AND: MDS DIAGNOSTICS PTY LIMITED First Respondent MDS DIAGNOSTICS LIMITED Second Respondent JUDGE: ALLSOP J DATE OF ORDER: 17 AUGUST 2007 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The hearing commencing on 8 October 2007 be vacated. 2. Leave be granted to the applicant to file an amended application in the form annexed to the notice of motion dated 10 August 2007 and marked "A". 3. Leave be granted to the applicant to file an amended statement of claim in the form annexed to the notice of motion dated 10 August 2007 and marked "B". 4. Pursuant to Order 8 rule 3(2) of the Federal Court Rules, leave is given to the applicant to serve the amended application, amended statement of claim, particulars of infringement, this notice of motion, the orders made pursuant to this notice of motion, and the following affidavits: Affidavit of Elizabeth Eldred Houlihan sworn 28 August 2006; Affidavit of Mark Stephen Volling sworn 1 September 2006; Affidavit of Susan Jane Drummond sworn 6 September 2006; Affidavit of Martin Joseph O'Connor sworn 6 September 2006; Affidavit of Martin Joseph O'Connor sworn 10 September 2006 (not including the confidential schedule and the confidential exhibits thereto); Affidavit of Martin Joseph O'Connor sworn 17 August 2007; upon Dr Prakash Appanna outside the Commonwealth of Australia and in New Zealand, such service to be effected by a private service agent personally serving Dr Appanna with those documents on or before 31 August 2007. 5. Orders 2 to 9 made on 10 April 2007 be vacated. 6. The matter be listed for further directions on 14 September 2007 at 2:15 pm as between the applicant and the first and second respondents and on 9 October 2007 at 9:30 am for all parties, including the third, fourth and fifth respondents. 7. On or before 7 September 2007, the first and second respondents serve on the applicant any application to file and serve any cross-claim as to invalidity, together with the form of that cross-claim, particulars of the invalidity and an affidavit in support of the claim for invalidity. 8. On 14 September 2007, the first and second respondents bring forward any application to join any party to the proceedings, whether in or out of Australia, having served the application and supporting materials upon the applicant by 12 September 2007. 9. The exhibits tendered on the hearing of the applicant's motion be returned on the undertaking of Mr O'Connor to keep them intact until a time after the appearance of the third, fourth and fifth respondents at which time it is apparent that no objection to joinder is made. 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 NSD 1722 OF 2006 BETWEEN: INVERNESS MEDICAL SWITZERLAND GMBH Applicant AND: MDS DIAGNOSTICS PTY LIMITED First Respondent MDS DIAGNOSTICS LIMITED Second Respondent JUDGE: ALLSOP J DATE: 17 AUGUST 2007 PLACE: SYDNEY REASONS FOR JUDGMENT 1 Application is made by the applicants, by way of notice of motion filed on 10 August 2007, for various orders: the amendment of the application, the amendment of the statement of claim, and for leave under Order 8 rule 3 of the Federal Court Rules to serve out of the jurisdiction in New Zealand another party with that amended application, statement of claim, and other associated documents. 2 This matter is set down for hearing for a week commencing Monday, 8 October 2007. It is plain, from the material put before me today, that that hearing date will be vacated. 3 The evidence before me would indicate that the applicant is in default in producing evidence in its case. This is partly explained by the default of the existing respondents in the production of documents on discovery which, themselves, have led to the possibility and then the reality of the need to join further parties. 4 This is a patent claim for infringement of various testing kits over which the applicant says it has registered patents. The evidence that has been led before me, being that contained in the affidavits of Mr Flynn's instructing solicitor, Mr O'Connor, and in the two bundles of exhibits that were tendered (one of which was confidential), make it clear that there is a reasonable prima facie case that the prospective third respondent has been, or may have been, sufficiently involved in what are said to be the contraventions to render him personally liable to the applicants. It goes without saying that none of those matters are said by way of conclusion. The third respondent is associated with the existing respondents. However, Mr Lang, who appears for the first and second respondents, has no instructions to accept service. I am prepared to make the order against Dr Appanna, based on the material provided to me. 5 The fourth and fifth respondents appear to be independent parties who it is said, have been involved in infringements in their own right by purchasing through the fourth respondent, either from the second respondent in New Zealand, or the first respondent in Australia. The fifth respondent is the human who is apparently in control of the fourth respondent. Leave is not needed, based on a prima facie case, in relation to those persons, and I am prepared to permit the amendment of the statement of claim to join those parties. 6 Before making orders to give effect to those matters and to vacate the hearing, I wish to refer to the dissatisfaction I have, that I have expressed today to the parties' representatives, as to how the matter has proceeded to date. Mr Flynn, who appears for the applicant, says that there is still great doubt as to what integers are in dispute in relation to the infringement case. Mr Lang, who appears for the first and second respondents, says that his client may have two cross-claims to file: one against a United States company, based on an asserted breach of warranty in relation to intellectual property, and the other a cross-claim against the applicant for invalidity. I have raised on prior occasions the questions as to whether there is any invalidity to be asserted and my recollection is I have been told that there is not, otherwise I would not have set the matter down for hearing. 7 This is a patent claim. Patent claims can throw up difficulties, but they are matters which require the most precise attendance to the issues in the case, so that, as can sometimes happen, unnecessary costs are not expended on matters that truly are not in dispute because parties and their legal representatives do not sufficiently attend to ascertaining the issues in dispute at an early stage. 8 Whilst there are parties to come, that is, the prospective third, fourth and fifth respondents and possibly a United States party, I intend to continue with the case management of the case between the applicant and the first and second respondents. I am alive to the need not to waste any time or money dealing with issues without all the parties being present, but from what has been put before me today, I think the parties need some encouragement to direct their attention as to what the issues on the statement of claim really are for their purposes. 9 For those reasons, I propose to make the following orders: 1. The hearing commencing on 8 October 2007 be vacated. 2. Leave be granted to the applicant to file an amended application in the form annexed to the notice of motion dated 10 August 2007 and marked "A". 3. Leave be granted to the applicant to file an amended statement of claim in the form annexed to the notice of motion dated 10 August 2007 and marked "B". 4. Pursuant to Order 8 rule 3(2) of the Federal Court Rules, leave is given to the applicant to serve the amended application, amended statement of claim, particulars of infringement, this notice of motion, the orders made pursuant to this notice of motion, and the following affidavits: Affidavit of Elizabeth Eldred Houlihan sworn 28 August 2006; Affidavit of Mark Stephen Volling sworn 1 September 2006; Affidavit of Susan Jane Drummond sworn 6 September 2006; Affidavit of Martin Joseph O'Connor sworn 6 September 2006; Affidavit of Martin Joseph O'Connor sworn 10 September 2006 (not including the confidential schedule and the confidential exhibits thereto); Affidavit of Martin Joseph O'Connor sworn 17 August 2007; upon Dr Prakash Appanna outside the Commonwealth of Australia and in New Zealand, such service to be effected by a private service agent personally serving Dr Appanna with those documents on or before 31 August 2007. 5. Orders 2 to 9 made on 10 April 2007 be vacated. 6. The matter be listed for further directions on 14 September 2007 at 2:15 pm as between the applicant and the first and second respondents and on 9 October 2007 at 9:30 am for all parties, including the third, fourth and fifth respondents. 7. On or before 7 September 2007, the first and second respondents serve on the applicant any application to file and serve any cross-claim as to invalidity, together with the form of that cross-claim, particulars of the invalidity and an affidavit in support of the claim for invalidity. 8. On 14 September 2007, the first and second respondents bring forward any application to join any party to the proceedings, whether in or out of Australia, having served the application and supporting materials upon the applicant by 12 September 2007. 9. The exhibits tendered on the hearing of the applicant's motion be returned on the undertaking of Mr O'Connor to keep them intact until a time after the appearance of the third, fourth and fifth respondents at which time it is apparent that no objection to joinder is made. I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Allsop. Associate: Dated: 24 August 2007 Counsel for the Applicant: Mr P Flynn Solicitor for the Applicant: Addisons Lawyers Counsel for the Respondent: Mr A Lang Solicitor for the Respondent: Gadens Lawyers Date of Hearing: 17 August 2007 Date of Judgment: 17 August 2007