Federal Court of Australia Vald Performance Pty Ltd v Kangatech Pty Ltd [2021] FCA 539 File number(s): QUD 440 of 2019 Judgment of: GREENWOOD J Date of judgment: 20 May 2021 Catchwords: INTELLECTUAL PROPERTY – considerations arising out of a directions hearing Division: General Division Registry: Queensland National Practice Area: Intellectual Property Sub-area: Patents and Associated Statutes Number of paragraphs: 27 Date of hearing: 19 May 2021 Counsel for the Applicant: Mr D Logan QC Solicitor for the Applicant: Holding Redlich Counsel for the Respondents: Ms H Rofe QC Solicitor for the Respondents: Griffith Hack ORDERS QUD 440 of 2019 BETWEEN: VALD PERFORMANCE PTY LTD (ACN 603 446 171) Applicant AND: KANGATECH PTY LTD (ACN 609 070 340) First Respondent QUEENSLAND UNIVERSITY OF TECHNOLOGY (ABN 83 791 724 622) Second Respondent order made by: greenwood j DATE OF ORDER: 20 may 2021 THE COURT ORDERS THAT: 1. The respondent provide to the applicant, within 21 days, details of the content of the changes made to the respondent's product described as the KT360 Version 2 so as to bring about the KT360 Version 3 disabling the Nordic curl function, as described at [17] to [26] of the reasons accompanying these orders. 2. The parties have liberty to apply on three days' notice. 3. The costs of the directions hearing are costs in the cause. 4. Pursuant to s 23 and s 37P of the Federal Court of Australia Act 1976 (Cth), rule 1.32 and rule 1.36 of the Federal Court Rules 2011, these orders and the reasons for judgment in support of these orders are made and published from Chambers. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT GREENWOOD J: 1 These proceedings arise out of a case management hearing designed to try and identify the most efficient way of advancing the primary proceedings. 2 In the primary proceeding, the applicant, Vald Performance Pty Ltd ("Vald") asserts that since 2017 the respondent, Kangatech Pty Ltd ("Kangatech"), has imported, exported, made, hired, sold, supplied or otherwise disposed of; offered to import, export, make, hire, sell, supply or otherwise dispose of; or kept a quantity of, for the purpose of importing, exporting, hiring, selling, supplying or otherwise disposing of, a device used to assess a person's knee flexor muscle strength (including hamstring strength) whilst the person performs an eccentric knee flexor contraction by lowering the upper body from a kneeling position. 3 The device so described is called the "Infringing Device". 4 Vald also pleads that since 2017 Kangatech has used the Infringing Device in the conduct of its business or so used it to perform the method described in claims 18, 19 and 20 of the patent in suit: Australian Standard Patent No. 2012388708 for an invention entitled Apparatus and Method for Knee Flexor Assessment. 5 As to the embodiment of the essential integers of claims of the patent, Vald pleads that the infringing device embodies the integers of claims 1 to 17 inclusive of the patent (described as the "Patent Apparatus Claims") and that each of the infringing uses embodies the integers of claims 18, 19 and 20 of the patent (described as the "Patent Method Claims"). 6 Vald pleads that by reason of these matters Kangatech has exploited the invention as claimed in the Patent Apparatus Claims and the Patent Method Claims and, alternatively, by hiring, selling, supplying or otherwise disposing of the Infringing Device, Kangatech has authorised persons to use the Infringing Device or use it to perform the method recited in claims 18, 19 and 20 of the patent in suit. 7 Vald asserts that there is continuing infringement and that it has suffered loss and damage. 8 By its amended defence, Kangatech says that prior to around November 2018 it exported from, made, sold and supplied in Australia; offered to export from, make, sell or supply in Australia; kept in Australia for the purpose of exporting, selling, supplying or otherwise disposing of, a product described as its "KangaTech Product" (particularised as the KangaTech Product depicted in a Kangatech memorandum dated July 2017 at pages 4 and 12. Kangatech also pleads that since around December 2018 it has exported from, made, sold and supplied in Australia; offered to export from, make, sell or supply in Australia; kept in Australia for the purpose of exporting, selling, supplying or otherwise disposing of only, a product described as its "KangaTech 360". 9 Kangatech also pleads that as at July 2019 it had permanently disabled all but two of the products described as "KangaTech Products", and replaced those products with the KangaTech 360. 10 Kangatech pleads that it denies that the KangaTech Product (that is, the earlier product) infringes any of the claims of the patent in suit on the footing that (leaving aside claims as to invalidity) the "KangaTech Product does not secure a lower leg of the subject [person] in a position that is substantially fixed as claimed by the patent": para 10(d)(ii), amended defence. Kangatech pleads that it denies that the KangaTech 360 infringes the claims of patent on the footing that (leaving aside claims as to invalidity) the "KangaTech 360 does not and cannot assess a subject's [person's] knee flexor muscle strength (including hamstring strength) whilst the subject performs an eccentric knee flexor contraction by lowering its upper body from a kneeling position": para 10(e)(ii), amended defence. 11 Kangatech also pleads that it otherwise denies the claims of infringement. 12 In the correspondence exchanged between the parties the "KangaTech Product" is sometimes described as Version 1 and the "KangaTech 360" is sometimes described as Version 2. I will also use those terms. 13 Having regard to Kangatech's pleading, Vald delivered an amended request for particulars of the pleading at paras 10(d)(ii) and 10(e)(ii) in these terms: … 3. Please provide full particulars of the particularised allegation in paragraph 10(d)(ii) of the amended defence that the KangaTech Product does not secure a lower leg of the subject in a position that is substantially fixed, as claimed by the Patent, including full particulars of the facts, matters and circumstances relied upon in support of that allegation. 4. Please provide full particulars of the particularised allegation in paragraph 10(e)(ii) of the amended defence that the KangaTech 360 does not and cannot assess a subject's knee flexor muscle strength (including hamstring strength) whilst the subject performs an eccentric knee flexor contraction by lowering its upper body from a kneeling position, including particulars of the facts, matters and circumstances relied upon in support of that allegation. 14 It seems that the Version 2 product or device was further modified in a way described in a document attached to a letter dated 16 December 2020 sent from the solicitors for Kangatech, Griffith Hack, to the solicitors for Vald, Holding Redlich. The document is described as "KT360 Nordic Curl removal Technical information". Before turning to that document, the background relating to the patent in suit is expressed in this way in the patent: "The present invention relates to an apparatus for use in assessing the strength of at least one knee flexor muscle of a subject, and in one example, for assessing at least the hamstring strength in at least one leg of the subject while the subject performs an eccentric knee flexor contraction". 15 Dr Tania Pizzari, in an affidavit (report) filed by Vald provides the following information. 16 The primary muscle group that flexes (bends) the knee is the hamstring muscle group. The hamstrings are made up of semimembranosus, the semitendinosus and the bicep femoris. Other muscles that contribute to knee flexion include the gracilis, the gastrocnemius and the sartorius. An eccentric muscle contraction is a mode of contraction in which the muscle lengthens while contracting. There are three types of muscle contraction: concentric, where the muscle fibres shorten during a contraction; isometric, where the muscle fibres do not change length during a contraction; and eccentric, where the muscle fibres lengthen during contraction. During an eccentric contraction (as with other forms of contraction) a person's muscle force can be detected. From this, inferences can be drawn as to injuries, rate of recovery (post-exercise) or improvements resulting from, for example, muscle strengthening activities. An eccentric knee flexor contraction involves the controlled lengthening of the knee flexor as the person lengthens his or her leg from a kneeling position, specifically a "Nordic contraction". It is performed by the person starting in a kneeling position with the ankle held in place and then lowering his or her body downwards, which requires the knee flexors to control the descent of the trunk (that is, the part of a person's body above the knee) and thereby lengthen the knee flexor muscles: paras 43 to 47. 17 As to the further modification, the document providing technical information says this about the KT360 product: Background The KT360 device contains 7 load cell sensors, in various orientations. Two sensors are oriented parallel to the ground in an outward direction, two sensors are oriented parallel to the ground in an inward direction, and 3 sensors are rotatable on an axis parallel to the ground such that they can be facing upward, downward or at any angle in between. The load cells are controlled by the KT360's Main Control Board which communicates with KangaTech's software via Bluetooth or USB. When the controlling software enables measurement on specific load cells, the Main Control Board supplies a control voltage to the load cell allowing for measurement of force. When the controlling software disables measurement, no control voltage is supplied and no measurement is possible. All communication with the KT360 sensor unit is encrypted using AES128, ensuring that only software with access to the secret key (i.e. KangaTech developed software) can control the device or read from the sensors. Further, the firmware installed on the device must be cryptographically signed, ensuring unsupported firmware cannot be installed on the device. Changes to KangaTech software 1. Removal of 'Eccentric Hamstring' option when creating a new test session. 2. Removal of 'Nordic drop' and 'Nordic return' options when creating a new training session. 3. Removal of bilateral testing or training options in protocols using relevant sensors 2 and/or 6 except 'Reverse Nordic'. 4. Addition of Nordic curl detection and prevention feature detailed below. Nordic curl detection When the user selects a test or training session which involves measurement from either of the relevant sensors, the software will perform a check every 200ms to detect whether a Nordic curl may be being performed. Where the user is performing a test unilaterally using one of the relevant sensors, the other relevant sensor is also enabled only for the purpose of detection, and the force is not displayed to the user. … Nordic curl prevention When a possible Nordic curl is detected, the software will immediately disable measurement of all sensors. In addition, at the time of detection, where the user was: a. completing a test, no peak force information is displayed. b. completing a training rep, no quality information is displayed. c. in "warm-up" mode, the warm up is ended. 18 Kangatech complains that Vald has failed to identify the integers of each of the claims of the patent in suit and failed to identify the respects in which the challenged products exhibit those integers. 19 In the ordinary course, that would be a perfectly sensible criticism of the amended pleading. 20 However, Vald observes that by the amended defence, the point of distinction pleaded by Kangatech as the basis for its denial of infringement of any of the claims of the patent is the point made at paras 10(d)(ii) and 10(e)(ii). Vald also says that it has put on the affidavit of Dr Tania Pizzari and in that affidavit, Dr Pizzari identifies all of the respects in which the Version 1 and Version 2 products exhibit the features of the claims of the patent in suit. That is done by reference to paragraphs of the affidavit (report) and by reference to a nine page schedule, Exhibit TP-4 to Dr Pizzari's affidavit. It seems that Kangatech is not now confining its denial of the infringement claims to the particulars given at paras 10(d)(ii) and 10(e)(ii) of the amended defence. That issue may need to be further addressed in a directions hearing. The amended defence was filed on 3 February 2020 and, on the basis of the present material, it seems that objection was taken to the applicant's approach adopted by the pleading and the failure to identify the integers of the claims and the respects in which those integers are apparent in the impugned products. If the only presently pleaded point of distinction in answer to the infringement claims is to be expanded, that is a significant change in the case. 21 As to the further modification which might be described as Version 3, Kangatech calls upon Vald to say whether Version 3 is said to infringe any or all of the claims of the patent in suit having regard to what is set out (quoted above) in the technical information document describing the removal of the Nordic curl feature from the KT360. 22 Vald says that it is not able to say whether the KT360 as modified according to that document falls outside the scope of the claims of the patent in suit because it does not have sufficient information to properly understand the changes described in the technical information document. That is said to be so because the document is not dated. It refers to the functionality of the apparatus which in turn is controlled by the relationship between KT360's Main Control Board which communicates with Kangatech's software. It is the controlling software that enables measurement of specific load cells and disables such measurement. When the controlling software disables measurement, no control voltage is supplied and no measurement is possible. Vald says that it is not clear whether any disablement of the Nordic curl feature is permanent or temporary. 23 In order to solve the problem of forming a view about the effect of the modifications bringing about Version 3, Vald contends that it makes much more sense for Kangatech to tell the applicant precisely what it has done, how it has been done and when it was done, so as to bring about the Version 3 modification. The applicant says that it will not assist it if the position really is that modifications have been made that can be changed by someone with a relevant access key so as to re-enable the function otherwise disabled. In the result, the applicant says that it makes more sense for the respondent to put on evidence identifying with some precision the modification made to the KT360 Version 2. 24 I accept that the content of the changes made to KT360 so as to bring about Version 3 lies entirely within the knowledge of the respondent. The respondent ought to provide a description of the scope of the changes setting out the content of the changes, when they were made and whether they are permanent or can be re-enabled by a change to the software (or otherwise). Further, as the amended defence stands, Version 3 is presumably said not to infringe by reason of the matters at para 10(e)(ii). 25 Against the background of that information, the applicant ought to undertake an examination of an example of the device in its Version 3 modality. 26 I propose to order that the respondent provide that information within 21 days. An inspection of a Version 3 device ought to be undertaken by the applicant as soon as possible after having had an opportunity to consider the material provided by the respondent. 27 The costs of the directions hearing will be reserved with liberty to apply on three days' notice. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Greenwood. Associate: Dated: 20 May 2021