FEDERAL COURT OF AUSTRALIA Yang v Vuly Pty Ltd [2020] FCA 1037 File number: NSD 559 of 2020 Judge: BURLEY J Date of judgment: 20 July 2020 Date of publication of reasons: 22 July 2020 Catchwords: PRACTICE AND PROCEDURE – application pursuant to r 34.25 of the Federal Court Rules 2011 (Cth) for an extension of time within which to appeal from decision of delegate of Commissioner of Patents – two month delay – where cause of delay is innocent mistake – where no prejudice to respondent – where appeal will be conducted as a hearing de novo and the respondent will be the effective moving party – application granted Legislation: Federal Court Rules 2011 (Cth) r 34.24, 34.25 Patents Act 1990 (Cth) s 29, 36 Cases cited: Donzenac Pty Ltd v MCV Enviroworks Pty Ltd [2015] FCA 361 Jackamarra v Krakouer [1988] HCA 27; 195 CLR 516 Jupiters Ltd v Neurizon Pty Ltd [2005] FCAFC 90; 222 ALR 155 Polwood Pty Ltd v Foxworth Pty Ltd [2008] FCAFC 9; 165 FCR 527 Vehicle Monitoring Systems Pty Ltd v SARB Management Group Pty Ltd [2020] FCA 408 Vuly Pty Ltd v Wei Yang [2020] APO 13 Date of hearing: 20 July 2020 Registry: New South Wales Division: General Division National Practice Area: Intellectual Property Sub-area: Patents and associated Statutes Category: Catchwords Number of paragraphs: 15 Counsel for the Applicant: Mr J. Cooke with Mr E. Thompson Solicitor for the Applicant: Eaglegate Lawyers Counsel for the Respondent: Ms J. Ambikapathy Solicitor for the Respondent: Maxwell Intellectual Property Lawyers ORDERS NSD 559 of 2020 BETWEEN: WEI YANG Applicant AND: VULY PTY LTD ACN 130 522 388 Respondent JUDGE: BURLEY J DATE OF ORDER: 20 JULY 2020 THE COURT ORDERS THAT: 1. The applicant have leave to appeal in the form of the draft Notice of Appeal filed on 20 May 2020. 2. The applicant pay the costs of the application. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT (Revised from transcript) BURLEY J: 1 The applicant, Wei Yang, seeks leave pursuant to r 34.25 of the Federal Court Rules 2011 (Cth) (FCR) for an extension of time in which to appeal from a decision of a Delegate of the Commissioner of Patents made on 28 February 2020: Vuly Pty Ltd v Wei Yang [2020] APO 13 (decision). The decision was made on 28 February 2020. FCR 34.24 requires that any notice of appeal be filed within 21 days of the date of the decision; in this case, by 20 March 2020. Instead, the present application together with a draft notice of appeal was filed two months after the date of the decision, on 20 May 2020. 2 Mr Yang is the applicant for Patent Applications Numbers AU2014268206, PCT/CN2015/085337 and AU2017216515 (collectively, patent applications), all of which relate to a frame structure for trampolines. The delegate's decision arises from an application brought pursuant to s 36 of the Patents Act 1990 (Cth) by Vuly Pty Ltd to the effect that it, and not Mr Yang, is solely entitled to the inventions claimed in those applications. The delegate found that Vuly's claim was made out. 3 Vuly and the Commissioner of Patents have been notified of the present application, and Vuly has filed a notice of appearance. Neither Vuly or the Commissioner has made any submission in opposition to the grant of the extension, although Vuly has reserved its position in relation to costs. 4 FCR 34.25 provides: (1) A person who wants to apply for an extension of time within which to file a notice of appeal mentioned in rule 34.24 must file an application for an extension of time, in accordance with Form 67. (2) The application may be made during or after the period mentioned in rule 34.24. (3) The application must be accompanied by: (a) an affidavit stating the following: (i) briefly but specifically, the facts on which the application relies; and (ii) why the notice of appeal was not filed within time; and (iii) the nature of the appeal; and (iv) the questions involved; and (b) a draft notice of appeal that complies with rule 34.24. (4) The applicant must, at least 14 days before the day fixed for the directions hearing, serve a copy of the application and the accompanying documents on: (a) the Commissioner; and (b) each interested person. 5 Mr Yang relies on an affidavit sworn by Xiao Sandy Zhang, a solicitor at Eaglegate Lawyers who acts for Mr Yang, in support of his application. Mr Zhang explains that he made a mistake about the time when a notice of appeal should be filed. He was provided with a copy of the decision on 2 March 2020 and read it. He observed that in the opening paragraph of the decision the delegate made a declaration under s 36(1) of the Patents Act to the effect that Vuly is the sole eligible person in respect of the patent applications, but then noted that in the next paragraph the delegate said (original emphasis): I allow Vuly Pty Ltd two (2) months in which to provide the further information requested in the final paragraph of this decision. 6 That request for information arises from [94] – [98] of the decision, where the delegate found that although Vuly succeeded in the application, the delegate remained uncertain as to the actual identity of the true inventor. The delegate explained that he accepted the case advanced by Vuly that Mr Joe Andon and/or employees of D3 Product Design Pty Ltd are the inventors of the "cross-over design", but that it was not clear whether Mr Andon had a claim to inventorship. He also noted that s 36 enables a person who has been determined to be an eligible person either to make a new application under s 29 of the Patents Act for the whole of the subject matter of the application, or to pursue the Yang applications as they currently stand. The delegate concluded with a request that Vuly provide written submissions on how it wished to proceed, preferably with evidence to establish the identity of the actual inventor, within two months. 7 Mr Zhang explains that he believed that the delegate's decision was not a final decision capable of being appealed, and that the time for any appeal would not start to run until the additional information sought by the delegate had been provided and addressed. He explains that on 14 May 2020 he re-read s 36 of the Patents Act and became aware for the first time that the declaration made by the delegate may comprise a final decision. Thereafter he urgently took steps to prepare the present application. 8 It is necessary for an applicant for leave to appeal to establish circumstances that warrant an extension of time within which to bring an appeal, although "special circumstances" which were a requirement of the predecessor to FCR 34.25, are no longer required. The factors applicable to determination of the grant of leave are not circumscribed by FCR 34.25, although some of those that are relevant to take into consideration are listed in Donzenac Pty Ltd v MCV Enviroworks Pty Ltd [2015] FCA 361 (Greenwood J at [44]) as: (1) the length of the delay; (2) the explanation for the delay, including whether the applicant is personally blameless for it; (3) any prejudice caused to the respondent or other persons arising out of the delay; (4) actions taken by the applicant to alert the respondent to the fact that the decision is or may be contested; (5) the merits of the proposed appeal; (6) alternative avenues for relief available to the applicant; and (7) questions of public interest, if any, applicable to the subject of the appeal. 9 These factors provide a useful guide for the exercise of discretion. In the present case, the delay is not long. Vuly does not contend that it is prejudiced by any delay. Although a patent is a right in rem, the grant of which may affect the rights of third parties, no patent has yet been granted and in the absence of anyone coming forward I can comfortably infer that no third party interests are likely to be prejudiced by the delay. Furthermore, I am satisfied that Mr Zhang has provided an adequate explanation for the delay. It was plainly not a decision made by Mr Yang for tactical or other inappropriate reasons. It was a mistake that Mr Zhang frankly and clearly explained and which he acted upon promptly to rectify. These factors tend in favour of the grant of leave. 10 The merits of the proposed appeal may be addressed in short form. I accept the submission advanced by Mr Cooke, who appears with Mr Thompson for Mr Yang, that the Court is to consider the prospects of the proposed appeal in a "rough and ready way", without descending into a full rehearsal of the appeal: Jackamarra v Krakouer [1988] HCA 27; 195 CLR 516 at [9]. Furthermore, it has frequently been noted that an appeal to this Court from a decision of a delegate of the Commissioner of Patents is a hearing de novo where the merits of the application are considered afresh and for the first time by a judicial officer. As Greenwood J notes in Donzenac at [15], the questions to be addressed do not involve an examination of whether there was factual or legal error on the part of the delegate. The appeal must be determined on the merits before this Court, and involves an exercise of original jurisdiction. Accordingly, the question is not so much whether the ground of appeal is reasonably arguable, but whether there may be merit in the application itself, bearing in mind that in the present case the onus lies on Vuly, as the effective moving party in a request that it has brought under s 36 of the Patents Act, to establish on the balance of probabilities that Mr Yang is not the person entitled to be named as inventor. In this context it is more likely that the merit of the application will require attention when it is a person in the position of the respondent – the effective moving party – seeking leave. 11 The central basis for the appeal is that the delegate erred in finding that the inventive concept as described and claimed in the patent applications resides in "the provision of safety poles for supporting the safety net that are joined after crossing one another at a location above the bounce mat of the trampoline" (at [73]). The applicant contends that the delegate ought to have found that the inventive concept is directed to the particular frame structure described at [007] to [009] of the specification of the patent applications, including, in particular, the safety pole assemblies described at [009] in which the safety poles are "grouped" into first and second units, are upwardly "cross-joined" with one another and are "routed" around the frame loop. Had the delegate done so, Mr Yang contends that he, and no other person, was responsible for the inventive concept. 12 The principles concerning the entitlement of a party to an invention in accordance with the provisions of the Patents Act have been considered in a number of authorities, see Vehicle Monitoring Systems Pty Ltd v SARB Management Group Pty Ltd [2020] FCA 408 at [235] – [240]. In Polwood Pty Ltd v Foxworth Pty Ltd [2008] FCAFC 9; 165 FCR 527 Finn, Bennett and Greenwood JJ said: [60] The invention or inventive concept of a patent or patent application should be discerned from the specification, the whole of the specification including the claims. The body of the specification describes the invention and should explain the inventive concepts involved. While the claims may claim less than the whole of the invention, they represent the patentee's description of the invention sought to be protected and for which the monopoly is claimed. The claims assist in understanding the invention and the inventive concept or concepts that gave rise to it. There may be only one invention but it may be the subject of more than one inventive concept or inventive contribution. The invention may consist of a combination of elements. It may be that different persons contributed to that combination. 13 Mr Yang wishes to contend that the delegate erred in his characterisation of the inventive concept. That is a matter of weighted fact and degree, having regard to the application of the proper principles applicable to the construction of a patent specification, as to which see Jupiters Ltd v Neurizon Pty Ltd [2005] FCAFC 90; 222 ALR 155 at [67]. 14 Having regard to the body of the specification, aspects of which I was helpfully taken to during the course of oral submissions, and the issues of fact that have been set out in the decision of the delegate and also in the affidavit evidence, in my view Mr Yang has a sufficiently arguable case. 15 Accordingly, having regard to all of the relevant circumstances, I am satisfied that it is appropriate to grant the requested extension of time for leave to appeal. The applicant should pay the costs of the application. The appropriate orders are that: (1) The applicant have leave to appeal in the form of the draft Notice of Appeal filed on 20 May 2020. (2) The applicant pay the costs of the application. I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Burley. Associate: Dated: 22 July 2020