FEDERAL COURT OF AUSTRALIA Scott v Icon Plastics Pty Ltd [2012] FCA 428 Citation: Scott v Icon Plastics Pty Ltd [2012] FCA 428 Parties: LAURENCE CLIFFORD SCOTT v ICON PLASTICS PTY LTD and COMMISSIONER OF PATENTS File number: VID 1314 of 2011 Judge: KENNY J Date of judgment: 27 April 2012 Catchwords: PATENTS – appeal under s 60(4) of the Patents Act 1990 (Cth) – no active respondent on appeal – issue for decision whether patent clearly invalid – no evidence to support grounds of opposition – appeal allowed. Legislation: Patents Act 1990 (Cth) Cases cited: Merck & Co Inc v Sankyo Co Ltd (1992) 23 IPR 415 European Community v Commissioner of Patents (2006) 68 IPR 539 Kaiser Aluminium & Chemical Corp v Reynolds Metal Co (1969) 120 CLR 136 RD Werner Co Inc v Bailey Aluminium Products Pty Ltd (1987) 8 IPR 339 F Hoffman-La Roche AG v New England Biolabs Inc (2000) 99 FCR 56 Genetics Institute Inc v Kirin-Amgen Inc (1999) 92 FCR 106 Titan Mining & Engineering Pty Ltd v Arnall's Engineering Pty Ltd (1988) 12 NSWLR 73 Caroma Sales Pty Ltd v Philmac Pty Ltd [1972–73] ALR 427 Brickwood Holdings Pty Ltd v ACI Operations Pty Ltd [1983] 2 VR 587 Cadbury Schweppes PLC v Effem Foods Pty Ltd (2006) 69 IPR 584 Date of hearing: 27 April 2012 Date of last submissions: 24 April 2012 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 16 Counsel for the Applicant: Mr R J L McCormack Solicitor for the Applicant: Arcadia Lawyers The First Respondent submitted to any order the Court might make, save as to costs. Counsel for the Second Respondent: Ms E Nance Solicitor for the Second Respondent: Australian Government Solicitor IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1314 of 2011 BETWEEN: LAURENCE CLIFFORD SCOTT Applicant AND: ICON PLASTICS PTY LTD First Respondent COMMISSIONER OF PATENTS Second Respondent JUDGE: KENNY J DATE OF ORDER: 27 APRIL 2012 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. The appeal be allowed. 2. The decision of the delegate of the Commissioner of Patents given on 3 November 2011, allowing the opposition, be reversed. 3. The opposition to Australian patent application No 2006 246 325 be dismissed and the said patent application proceed to grant. 4. The costs order in the opposition hearing below be vacated. 5. There be no order as to the costs of the appeal. 6. Unless otherwise ordered, the applicant serve a sealed copy of these orders upon the Commissioner of Patents at the expiration of 7 days and no later than 10 May 2012. 7. These orders not be entered before 7 May 2012. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1314 of 2011 BETWEEN: LAURENCE CLIFFORD SCOTT Applicant AND: ICON PLASTICS PTY LTD First Respondent COMMISSIONER OF PATENTS Second Respondent JUDGE: KENNY J DATE: 27 APRIL 2012 PLACE: MELBOURNE REASONS FOR JUDGMENT Introduction 1 This is an appeal against a decision of a delegate of the Commissioner of Patents made on 3 November 2011 (the decision) concerning Australian Patent Application No. 2006 246 325 (the patent application). 2 I would allow the appeal for the reasons set out below. background The Decision of the Delegate of the Commissioner of Patents 3 Laurence Clifford Scott (the applicant) filed the patent application with the Australian Patent Office on 11 May 2006. Icon Plastics Pty Ltd (Icon) filed a notice of opposition on 28 January 2010, followed by a statement of grounds and particulars on 19 April 2010. After the filing of evidence in support and in answer, the delegate heard the matter on 10 August 2011. 4 The patent application concerned blow moulded products and methods for making them. For present purposes, it suffices to adopt the description of the specification given by the delegate at [7]-[12] of the delegate's reasons for decision. This was as follows: The specification is entitled "Air duct" and relates to a moulded air duct and a method of making the same. It explains that air ducts for exhaust air that are installed in wall and ceiling spaces of buildings are typically made of sheet steel. However steel ducts suffer from the problems that they are acoustically poor tending to resonate readily and also their high thermal conductivity can lead to condensation. The specification further states that joints between ducts need to be taped or otherwise sealed. The invention overcomes these problems by providing a moulded air duct that has an elongated cross-section so that it is capable of being installed in a wall or ceiling space and contains an effective amount of flame retardant. The duct also has complementary male/female joins at the opposite ends and this enables two ducts to be joined together by inserting the male join of one duct into the female join of an adjoining duct. The duct also has at least one joint site of enlarged cross-section intermediate the ends which can be parted transversely to create complementary male and female joins in the two shorter ducts thus created. The enlarged cross-section is also said to stiffen the duct. Tubular supports extending between opposite internal walls of the duct can be provided to further stiffen the ducts. The specification also broadly discloses a method of making the duct by initially blow moulding a parison to form a duct that is closed at both ends with an enlarged join site at one end and has at least one enlarged joint site intermediate the ends. The ends of the parison are then removed to create the final duct with a male join at one end and a female join at the enlarged end. The specification as accepted ends with sixteen claims. The applicant filed under section 104 an amended set of claims on 21 March 2011 which was yet to be allowed at the date of the Hearing after being advertised on 30 June 2011. The delegate noted that the parties had agreed that the delegate should make the decision on the basis of the amended claims, as subsequently allowed. 5 The grounds of opposition were: (1) lack of entitlement; (2) lack of novelty; (3) lack of inventive step; and (4) lack of clarity. See the Patents Act 1990 (Cth) (the Patents Act), s 59. The delegate considered and dismissed the three latter grounds, but upheld the lack of entitlement ground. Thus, on 3 November 2011, the delegate allowed Icon's opposition, relevantly concluding (at [90]-[92]): Royston Douglas Bull came up with the concept of the enlarged intermediate joint site and is the sole inventor of the invention. Greg Scott is not an inventor and Laurence Clifford Scott is not entitled to the grant of a patent for the invention. Icon is a person who would be entitled to the grant of a patent for the claimed invention. 6 Accordingly, the delegate refused to order that the patent application proceed to grant, and made an order for costs against the applicant. The appeal 7 The applicant appeals under s 60(4) of the Patents Act against that part of the decision that allowed Icon's opposition on the basis of lack of entitlement, and awarded costs against the applicant. The appeal is brought essentially on the ground that the delegate erred in finding that Royston Douglas Bull was the inventor and that Icon was an eligible person entitled to the grant of a patent the subject of the patent application. The applicant's position is that the delegate should have found that he, not Icon, was an eligible person entitled to the grant of the patent. 8 By his notice of appeal, the applicant sought orders and declarations to give effect to these contentions, as well as an order that Icon pay his costs of the opposition and of the appeal. No active respondent on appeal 9 On 23 March 2012, Icon was granted leave to file a submitting notice, save in relation to costs. On 30 March 2012, the Commissioner of Patents was joined as second respondent. The Commissioner, though appearing on the hearing of the appeal to assist the Court if the occasion arose, did not made any submissions regarding the appeal, having advised the Court previously that the Commissioner did "not wish to be heard in opposition to the appeal as it [did] not, in the Commissioner's view, raise any matters of public interest". There was, therefore, no active respondent before the Court in these proceedings: compare Merck & Co Inc v Sankyo Co Ltd (1992) 23 IPR 415 at 417-418 per Lockhart J. Nature of an appeal under s 60(4) of the Patents Act 10 The Court has jurisdiction to hear the appeal under s 60(4) of the Patents Act. An appeal under s 60(4) of the Patents Act is within the original jurisdiction of this Court and requires a hearing de novo: see European Community v Commissioner of Patents (2006) 68 IPR 539 ('European Community') at 541 [9] per Young J citing Kaiser Aluminium & Chemical Corp v Reynolds Metal Co (1969) 120 CLR 136 at 142; R D Werner Co Inc v Bailey Aluminium Products Pty Ltd (1987) 8 IPR 339 at 340; and F Hoffman-La Roche AG v New England Biolabs Inc (2000) 99 FCR 56 ('Hoffman-La Roche') at 63. 11 In an appeal under s 60(4), the issue for decision is whether, if granted, the patent would be clearly invalid: see European Community at 541 [10] and Hoffman-La Roche at 70 [67] per Emmett J and the authorities to which Emmett J referred in his reasons. These authorities accept that, unless a patent is clearly invalid, it should be allowed to proceed to grant: see Hoffman-La Roche at 66-70 [48]-[67]. In this context, the purpose of pre-grant opposition proceedings must be borne in mind: see Hoffman-La Roche at 66 [47], citing Genetics Institute Inc v Kirin-Amgen Inc (1999) 92 FCR 106 at 112 [19]. It must also be borne in mind that allowing a patent to proceed to grant does not establish the validity of the patent: see Hoffman-La Roche at 67 [51], 70 [66]. Thus, in an appeal of the present kind, the Court's task is not to determine whether the patent is in fact valid. 12 On an appeal under s 60(4) of the Patents Act, the duty of the Court is to exercise de novo the function of the Commissioner of Patents under s 60. Notwithstanding this, the only evidence that the Court considers in deciding the appeal is that tendered at the hearing and admitted by the Court: see Cadbury Schweppes PLC v Effem Foods Pty Ltd (2006) 69 IPR 584 ('Cadbury Schweppes') at 586 [15]-[16] per Lindgren J, citing European Community; and European Community at 543 [15] citing Titan Mining & Engineering Pty Ltd v Arnall's Engineering Pty Ltd (1988) 12 NSWLR 73 ('Titan') at 75-76; Caroma Sales Pty Ltd v Philmac Pty Ltd [1972–73] ALR 427; and Brickwood Holdings Pty Ltd v ACI Operations Pty Ltd [1983] 2 VR 587 at 588-589. The Court, in discharging its task, may take into account a ground of opposition specified in s 59: see Titan at 75-76. 13 In support of the appeal, the applicant relied on the affidavits of John Gerard Weir sworn on 19 April 2012 (with annexures); Laurence Clifford Scott sworn on 20 April 2012 (with annexures); Gregory Wayne Scott sworn on 20 April 2012 (with annexures); Martyn Laurence Scott sworn on 20 April 2012 (with annexures); Paul Robert Cramond sworn on 20 April 2012 (with annexures); and Virginia Ann Beniac-Brooks sworn on 23 April 2012 (with its exhibit). At the hearing, the Court gave the applicant liberty to file and rely on a document entitled "Corrections to the Affidavit of Paul Robert Cramond sworn 20 April 2012 together with annexures thereto marked PRC-1 to PRC-13". This document noted that certain corrections of a typographical or similar non-substantive kind should be understood as made to Mr Cramond's affidavit. 14 In the normal course of a proceeding such as this, the opponent bears the onus of satisfying the court that the grant of a patent would be clearly invalid: see Hoffman-La Roche at 63 [29]; European Community at 541 [11]-[12]; and Cadbury Schweppes at 586 [16]. If there is no evidence capable of supporting the opposition, then the patent must be allowed to proceed to grant. See Cadbury Schweppes at 586 [15] per Lindgren J and European Community at 541 [11]-[12] per Young J. Whilst the grounds upon which the Court may refuse a patent application are those available to an opponent, whether or not relied on by an opponent, nonetheless, as Young J noted in European Community at 543 [17], the only grounds upon which the Court can act are those supported by evidence or those not requiring evidence. 15 Icon has neither tendered nor adduced evidence in support of any ground of opposition, including as to lack of entitlement. Neither Icon nor the Commissioner of Patents has made any submission in answer to the applicant. The authorities are clear that where there is "no evidence before the court capable of supporting any actual or potential ground of opposition, there is no basis on which the court can uphold any ground of opposition": see Cadbury Schweppes at 586 [16]. The applicant has tendered a not-insignificant amount of evidence in support of the appeal, including evidence as to his entitlement. There is nothing before the Court that leads me to conclude that the patent would be clearly invalid if it proceeded to grant. Having regard to the nature of the appeal and the authorities, there is no occasion for this Court to undertake a detailed consideration of the merits of the opposition, none of which have, in any event, been pressed on the appeal. 16 Accordingly, I would propose to make orders of the kind sought by the applicant. I would make no order as to the costs of the appeal. In view of the first respondent's exception to its submitting appearance, I would direct that these orders not be entered before 7 May 2012. I would also order that, unless otherwise ordered, the applicant serve a sealed copy of these orders upon the Commissioner of Patents at the expiration of 7 days and no later than 10 May 2010. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kenny. Associate: Dated: 27 April 2012