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Mainly intellectual property (IP) issues Down Under

GSK’s extended release paracetamol patent 2

In addition to dismissing GSK’s appeal against the construction of “basket” (noted here), the Full Court also dismissed Apotex’ cross-appeals on fair basis and best method.

Fair basis

Apotex and Generic Partners also lost their appeals against the trial judge’s ruling that GSK’s patent was fairly based and there had been no failure to disclose the best method.

On fair basis, the claims were consistent with the consistory clauses, but Apotex argued the body of the specification showed that the invention was narrower than the broad consistory clauses. This appears to have been an attempt to read the claims down to two specific formulations discussed in the specification, Formulations C and D.

A key point was whether the trial judge had impermissibly taken into account information in an FDA report to ascertain if the claims travelled beyond the disclosure in the specification. Apotex argued this was excluded by the High Court’s decision in the first Lockwood decision, where it had said at [48]:

If all that is essential in assessing a fair basing objection is recourse to the contents of the specification, there is no call, for example, for an examination (except on construction questions) of common general knowledge (which is essential when considering an objection based on want of an inventive step), or of prior art (which is essential when considering novelty (s 7(1))) …

The Full Court, however, rejected this attack; concluding that the information in the FDA Report (which was common general knowledge) informed how the skilled addressee would understand the claims. At [166], the Full Court said:

What is critical to the pharmacokinetic behaviour of the many formulations within the claims is the dissolution profile (or release rate) of the formulation. The primary judge accepted that the FDA Report recognised that a variation of ±10% percentage points in the release rate was acceptable to the FDA even where no IVIVC had been established. This provides evidentiary support for the finding that the skilled addressee would know that various formulations within the claims apart from Formulations C and D were likely to have similar pharmacokinetic properties. This also provides a complete answer to Apotex’s argument that the skilled addressee (equipped with the common general knowledge) would approach the Patent with an understanding that there would be no reason to think that other formulations within the claims would have a similar pharmacokinetic profile to Formulations C and D in the absence of any established IVIVC.

The Full Court also rejected Apotex’ argument that a claim could not be fairly based unless the specification explained why the claims worked. Making it clear that they were dealing only with the position before the Raising the Bar Act reforms, the Full Court said at [170]:

Of course, it is important to note that s 40(2)(a) requires that the complete specification “describe the invention fully”. A complete specification may still “describe the invention fully” without explaining why the invention works. After all, the inventor, who presumably believes that the invention described works, may not understand why it works. But this does not prevent him or her from obtaining patent protection for the invention.

Best method

For best method, the argument built on the Servier ruling to argue there had been a failure to disclose the best method because the specification did not disclose the particular grade or viscosity of the high viscosity HPMC or the granulation end points used to make Formulations C and D.

At [192], the Full Court accepted that there could be a failure of best method if information was withheld even though it could be ascertained by routine experiment. The Full Court rejected the best method attack, however, finding that the information omitted was inessential manufacturing and production information. According to the Full Court at [201]:

It does not follow merely because the patent applicant uses a particular manufacturing process or a particular excipient in formulating its commercial embodiment that it will form part of the best method. The patent applicant may have adopted a particular process, or used a particular excipient, for reasons that are associated with its own particular circumstances rather than because it believes that they reflect the best method. The best method known to the patent applicant may be one that allows for the optimisation of a formulation by the skilled addressee rather than one that adheres to one specific formulation that the patent applicant seeks to commercialise.

Those preparing specifications might want, first, to note the reservation that the Full Court was not dealing with the “new” post-Raising the Bar regime. Secondly, [192] appears to carry with it the warning that, if one leaves something out, one does so at one’s own peril.

 

 

A Basket Is Still Not A Cylinder

Glaxo has lost its appeal against Beach J’s ruling that Apotex and Generic Partners did not infringe its sustained release paracetamol patent. In a battle between what the skilled addressee would understand and the plain, literal wording of the claim, the lawyers won out.

Interpreting the claim

Claim 1 of the patent is for a pharmaceutical composition with a bilayer tablet having both an immediate release phase of paracetamol and a sustained release phase wherein:

said composition has an in vitro paracetamol dissolution profile (as determined by the USP type III apparatus, reciprocating basket, with 250ml of 0.1M HCl at 37C set at a cycle speed of 15 strokes/min) with the following constraints:

(a) 30 – 48% released after 15 minutes,

(b) 56 to 75% after 60 minutes and

(c) more than 85% after 180 minutes.

The problem was in that reference to a “reciprocating basket”, as a USP type III apparatus had a reciprocating cylinder, not a basket.

At the relevant time, there were four types of apparatus for testing dissolution – a USP type I apparatus, a USP type II apparatus, a USP type III apparatus and a USP type IV apparatus. The four types of machines provided different hydrodynamics which, in turn, meant the user would obtain different dissolution results. If one used a different apparatus, therefore, one might get a different dissolution profile.[1]

As already noted, the USP type III apparatus did not have a reciprocating basket. “Pharmaceutical scientists” generally referred to the USP type 1 apparatus as a “basket”, the type II apparatus as a “paddle”, the type III apparatus as a “reciprocating cylinder” and the type IV apparatus as a “flow through cell”.

This reflected the different construction and working of the machines. To test dissolution using a type I apparatus, the composition was placed in a cylindrical mesh basket which was then placed inside a cylindrical vessel containg the dissolution medium. The basket then rotated around inside the cylindrical vessel.

In a type III apparatus, the composition is placed inside a glass reciprocating cylinder which is then moved up and down in a glass vessel containing the dissolution medium.

Apparently, it would be possible to modify a type III apparatus to use a “basket”, but there was no evidence anyone had ever done so.

Against this background, the evidence established that the skilled addressee would recognise that the reference to “basket” in the claim was a mistake.

The question is then how is the claim to be interpreted. GSK argued that the skilled addressee would simply read the reference to a “reciprocating basket” as a reference to the reciprocating cylinder that type III apparatus used. The Full Court considered that this went beyond a purposive construction and would involve impermissibly rewriting the claim.

After referring to Catnic[2] and Kirin-Amgen, the Full Court said at [109]:

It is important to note that Lord Hoffman [in Kirin-Amgen at [34]] was referring here to the meaning conveyed to the skilled addressee by the language used and was not directing himself to a situation in which the skilled addressee deduced that the language of the claim, although conveying to him or her a particular meaning, could never have been intended to mean what it conveyed.

Here, the skilled addressee knew what the term “basket” meant, but “deduced” it couldn’t be intended to mean that.

The Full Court then emphasised a point made in many cases: a patent is a document prepared by the patentee “in words of the patentee’s own choosing” and “the words will usually have been chosen upon skilled advice.”

First, if a mistake had been made, there was a procedure for amendment – which GSK had not invoked in this case. The availability of that procedure had the further significance that [s 115][s115] provided alleged infringers with some protection from damages before the amendments were allowed.

Secondly, in describing the device used for dissolution testing, GSK (at least on its case) was not trying to identify something new. So, the difficulties of describing something which had not existed before would not arise.[3]

Thirdly, the words had to have been put there to mean something. At [138]:

GSK’s infringement case can only succeed if the words “reciprocating basket” are either interpreted to mean “reciprocating cylinder” or simply ignored. Either approach involves an impermissible re-writing of the relevant claims.

And, really, that is the Full Court’s point. Athough one is supposed to interpet the claim through the eyes of the skilled addressee, reading claim 1 the way the skilled addressee apparently would have done did not make proper allowance for the function of the claims. At [139]:

This is a case in which the skilled addressee’s understanding of the claims, as found by the primary judge, does not make proper allowance for the function of the claims in defining the invention. Ultimately, it is for the court to decide the meaning of the claims. This is a case in which we think the language of the claim must be understood to mean what it actually says.

So, although the patent specification is addressed to, and to be understood through the eyes of the person skilled in the art, the Full Court qualified that approach in light of other policies gleaned fron the Act.

Fair basis

Apotex and Generic Partners also lost their appeals against the trial judge’s ruling that GSK’s patent was fairly based and there had been no failure to disclose the best method.

On fair basis, the claims were consistent with the consistory clauses, but Apotex argued the body of the specification showed that the invention was narrower than the broad consistory clauses. This appears to have been an attempt to read the claims down to two specific formulations discussed in the specification, Formulations C and D.

A key point was whether the trial judge had impermissibly taken into account information in an FDA report to ascertain if the claims travelled beyond the disclosure in the specification. Apotex argued this was excluded by the High Court’s decision in the first Lockwood decision, where it had said at [48]:

If all that is essential in assessing a fair basing objection is recourse to the contents of the specification, there is no call, for example, for an examination (except on construction questions) of common general knowledge (which is essential when considering an objection based on want of an inventive step), or of prior art (which is essential when considering novelty (s 7(1))) …

The Full Court, however, rejected this attack; concluding that the information in the FDA Report (which was common general knowledge) informed how the skilled addressee would understand the claims. At [166], the Full Court said:

What is critical to the pharmacokinetic behaviour of the many formulations within the claims is the dissolution profile (or release rate) of the formulation. The primary judge accepted that the FDA Report recognised that a variation of ±10% percentage points in the release rate was acceptable to the FDA even where no IVIVC had been established. This provides evidentiary support for the finding that the skilled addressee would know that various formulations within the claims apart from Formulations C and D were likely to have similar pharmacokinetic properties. This also provides a complete answer to Apotex’s argument that the skilled addressee (equipped with the common general knowledge) would approach the Patent with an understanding that there would be no reason to think that other formulations within the claims would have a similar pharmacokinetic profile to Formulations C and D in the absence of any established IVIVC.

The Full Court also rejected Apotex’ argument that a claim could not be fairly based unless the specification explained why the claims worked. Making it clear that they were dealing only with the position before the Raising the Bar Act reforms, the Full Court said at [170]:

Of course, it is important to note that s 40(2)(a) requires that the complete specification “describe the invention fully”. A complete specification may still “describe the invention fully” without explaining why the invention works. After all, the inventor, who presumably believes that the invention described works, may not understand why it works. But this does not prevent him or her from obtaining patent protection for the invention.

Best method

For best method, the argument built on the Servier ruling to argue there had been a failute to disclose the best method because the specification did not disclose the particular grade or viscosity of the high viscosity HPMC or the granulation end points used to make Formulations C and D.

At [192], the Full Court accepted that there could be a failure of best method if information was withheld even though it could be ascertained by routine experiment. The Full Court rejected the best method attack, however, finding that the informatin omitted was inessential manufacturing and production information. According to the Full Court at [201]:

It does not follow merely because the patent applicant uses a particular manufacturing process or a particular excipient in formulating its commercial embodiment that it will form part of the best method. The patent applicant may have adopted a particular process, or used a particular excipient, for reasons that are associated with its own particular circumstances rather than because it believes that they reflect the best method. The best method known to the patent applicant may be one that allows for the optimisation of a formulation by the skilled addressee rather than one that adheres to one specific formulation that the patent applicant seeks to commercialise.

Those preparing specifications might want, first, to note the reservation that the Full Court was not dealing with the “new” post-Raising the Bar regime. Secondly, [192] appears to carry with it the warning that, if one leaves something out, one does so at one’s own peril.

GlaxoSmithKline Consumer Healthcare Investments (Ireland) (No 2) Limited v
Generic Partners Pty Limited
[2018] FCAFC 71 (Middleton, Nicholas and Burley JJ)


  1. At [50], the Full Court explained, “There is no established correlation between dissolution results measured using the different USP apparatus. Sometimes small differences are measured, other times the measured differences are large. Differences in measured dissolution profiles as between each of USP type I, II and III apparatus may not be predictable.”  ?
  2. Catnic Components Limited & Anor v Hill & Smith Limited [1982] RPC 183 (HL).  ?
  3. Referring to another aspect of the construction problem adverted to by Lord Hoffmann at [34] in Kirin-Amgen. Leading of course to the irony that GSK did in fact describe something new!  ?

Patent cases in the Federal Court

Kelvin Tran from Litimetrics has published some fascinating statistics about patent litigation in the Federal Court of Australia.

For example, since 2010, 472 cases have been commenced in the Federal Court involving patent issues. Mr Tran points out that number “compares” to 160,000 granted standard patents and 1,400 certified patents.

The publication also includes a breakdown of numbers by registry, length of proceedings, time to resolution and the average number of typical events such as directions hearings, interlocutory applications and the like. They may be useful if you have to prepare a budget or a costs disclosure statement. To view Mr Tran’s statistics, you should go here.

ESCO’s patent did not make a composite promise and so is not invalid afterall

ESCO has won its appeal from the ruling that its patent lacked utility because the claims did not fulfill all promised advantages.

The Patent

ESCO’s patent relates to a wear assembly for securing a wear member to excavating equipment. Think of it as a way of attaching “teeth” to an excavating bucket and for a design of the “teeth” themselves.

There are 26 claims.

Claim 1 (and its dependent claims)[1] are for a wear member:[2]

a wear member for attachment to excavating equipment. The wear member comprises:
(a) a front end (to contact materials being excavated and to protect the excavating equipment);
(b) a rear end;
(c) a socket that opens in the rear end of the wear member (to receive a base fixed to excavating equipment);
(d) a “throughhole” in communication with the socket;
(e) a lock “integrally connected” in the throughhole and movable without a hammer;
(f) between a “hold position” and a “release position”;
(g) the lock and the throughhole being cooperatively structured to retain the lock in the throughhole in each of the hold and release positions;
(h) irrespective of the receipt of the base into the socket of the wear member or the orientation of the wear member;
(i) a “hold position” (where the lock can secure the wear member to the base); and
(j) a “release position” (where the wear member can be released from the base).

Claim 13 (and its dependent claims)[3] are for the wear assembly:[4] essentially, a wear assembly designed to enable the attachment of the wear member of claim 1 to the bucket.

You may get some idea of what is claimed from these figures. The wear member is 28, shown fitted to the base 15 of the wear assembly.

Utility

The trial Judge

Paragraph 6 of the Specification was the first paragraph under the heading “Summary of the Invention”:

The present invention pertains to an improved wear assembly for securing wear members to excavating equipment for enhanced stability, strength, durability, penetration, safety and ease of replacement. (Full Court’s emphasis)

As to which the expert evidence was:

In relation to enhanced strength, none of the claims would achieve this advantage.

In relation to enhanced stability, claims 3 and 5 may provide a minor stability advantage as set out in paragraphs 14–21 of my first affidavit. ….

In relation to enhanced durability, none of the claims would achieve this advantage.

In relation to enhanced penetration, none of the claims would achieve this advantage.

In relation to enhanced safety, claims 1, 11, 13, 21, and 22 would achieve this advantage.

In relation to enhanced ease of replacement, claims 1, 4, 6, 8, 9, 12, 13, 16, 19, 22, and 25 would achieve this advantage.

In light of this evidence, the trial Judge had found ESCO’s patent invalid because the claims did not achieve all six of benefits promised by paragraph 6 of the Specification.

The Full Court

On appeal, the Full Court accepted the basic premise applied by the trial Judge: a claim is bad for inutility if following the teaching in the Specification does not lead to the promised result. There has been a failure of consideration. So, the Full Court explained at [208]:[5]

first, provided the results promised by the specification can, on the evidence, be achieved and, second, provided that those results can be applied to at least one useful purpose, the patent for the claimed invention does not fail for inutility. If, however, the promised results are unfulfilled or unrealised, the patent for the claimed invention will be bad for inutility

Further, if the Specification properly understood contained a “composite” promise, any claim which failed to achieve any one of the elements of that composite promise would be bad for inutility. At [239]:

We therefore accept that if para 6 of the Patent Application, properly understood having regard to the whole of the Specification including the claims, contains a “composite” promise for the described invention, a failure to attain any one of the elements of the composite promise in any claim defining the invention renders the invention so far as claimed in any claim, inutile.

The question then is – what is the promise of the invention?

It followed from the requirements of s 40, which required the specification to describe the invention fully and claims to define the invention,[6] that identification of the “promise” of the invention required consideration both of the body of the specification and the claims.

That consideration led the Full Court to conclude either that paragraph 6 of the Specification was not the “promise” of the invention. Or, alternatively, if it were, the several elements in paragraph 6 were to be read disjunctively rather than, as the trial Judge had done, conjunctively. In either case, ESCO’s patent was not bad for inutility.

The central consideration here was that the claims were directed to two related, but different entities: claims 1 to 12 being directed to the “wear member” only; claims 13 to 22 being directed to the “wear assembly”. Correspondingly, paragraphs 7 to 20 of the specification dealt with various “aspects” of the invention and, in doing so, paragraphs 15 and 16 identified the “promises” of the invention.

The Full Court considered paragraph 5 of the specification as reciting historical attempts “to enhance the strength, stability, durability, penetration, safety and/or ease of replacement of “such wear members” … with varying degrees of success.” The Full Court then characterised paragraph 6 as continuing that discussion to open the summary of the invention.

Paragraphs 15 and 16 of the specification said:

In one other aspect of the invention, the lock is integrally secured to the wear member for shipping and storage as a single integral component. The lock is maintained within the lock opening irrespective of the insertion of the nose into the cavity, which results in less shipping costs, reduced storage needs, and less inventory concerns.

In another aspect of the invention, the lock is releasably securable in the lock opening in the wear member in both hold and release positions to reduce the risk of dropping or losing the lock during installation. Such an assembly involves fewer independent components and an easier installation procedure. (Full Court’s emphasis)

So, at [291], the Full Court explained:

It seems to us that the language of para 6 consisting of a single sentence under the heading “Summary of the Invention” is not, properly construed, the language of “promises” (as Ronneby would have it) for the invention described in the Specification as a whole, including the 22[7] claims, some of which are concerned only with the wear member and others with the wear assembly. Rather, the language of para 6 is seeking to do something less than that. The language of para 6 resonates with para 5 and seems to be used in the sense of reciting those things to which the invention relates having regard to the design efforts that went before, and thus the relationship between “the invention” and those things recited in para 6 is one of identifying the topics or subject matter to which the invention relates (rather than “promises” for the invention), which, having regard to paras 7 to 20 “describing” the invention (including the best method in conformity with s 40(2)(a)), may or may not find expression in the claims “defining” the invention for the purposes of s 40(2)(b). In that sense, the fully described invention may go beyond the scope of that which is actually claimed. Thus, it is necessary to identify the “teaching” of the Specification and the relationship between the teaching and the claims. Rather, the promises for the invention so far as claimed in, at least, Claim 1 and the dependent claims, are to be found in paras 15 and 16 of the Specification as we explain later in these reasons.

The two different targets of the two sets of claims were also significant for the alternative conclusion that the list of achievements in paragraph 6 should be read disjunctively. The Full Court accepted that the language of paragraph 6 of the specification was appropriate for the claimed wear assemblies achieving all 6 listed benefits. However, the Full Court considered that the language of paragraph 6 was incompatible with the idea that each claim for the wear member must satisfy all 6 promises.

Accordingly, paragraph 6 of the specification should be read disjunctively and the claims were not bad for inutility.

In the course of its lengthy historical review, the Full Court did note that s 7A now required the Specification to disclose a specific, substantial and credible use for the claimed invention for it to be useful. Section 7A had been introduced into the Act by the Raising the Bar Act[8] and so was not relevant to ESCO’s patent. The Full Court noted, however, that s 7A was intended to add additional requirements to the test of utility, not displace the old requirements. Thus, at [231], the Full Court commented:

Rather, the invention [subject to the Raising the Bar Act amendments] must meet the new test and meet the requirements of the existing law: EM p. 44.

I am guessing we shall see significantly more patent specifications in the future which claim that it is “an object of the invention to …” or, perhaps, the invention achieves “one of more of ….” Might be a bit tricky to amend assertions in a patent first filed overseas.

Novelty

ESCO’s novelty appeal was also successful. It was essentially an exercise in construction, turning on whether the locking mechanism in the prior citation was “integral” and moved between two defined points- a “hold position“ and a ”release position”.

ESCO Corporation v Ronneby Road Pty Ltd [2018] FCAFC 46 (Greenwood, Rares and Moshinsky JJ)


  1. Strictly speaking, claims 5, 6 and 9 are independent claims, but nonetheless are for “wear members”.  ?
  2. The explanatory interpolations are the Full Court’s.  ?
  3. Claim 19 is also an independent claim for a wear assembly.  ?
  4. A wear assembly for attachment to excavating equipment comprising: (1) a base fixed to the excavating equipment; (2) a wear member including a front end to contact materials being excavated and protect the excavating equipment, and a rear end to mount to the base fixed to the excavating equipment; and (3) a lock integrally connected to the wear member and movable without a hammer between a hold position where the lock contacts the base and the wear member to secure the wear member to the base and a release position where the wear member can be released from the base, wherein the lock remains secured to the wear member in the release position. (My numbering to deal with formatting limitations)  ?
  5. Citing amongst others LaneFox v Kensington and Knightsbridge Electric Lighting Co (1892) 9 RPC 413.  ?
  6. ESCO’s patent being a pre-Raising the Bar patent, s 40 in it earlier form applied.  ?
  7. Presumably, a typo.  ?
  8. By which I of course mean schedule 1 of the Intellectual Property Laws Amendment (Raising the Bar) Act 2012.  ?

Enforcing foreign judgments – consultations

The Commonwealth government is participating in negotiations for a new Convention on the recognition and enforcement of foreign judgments. Now it is seeking public input on a range of outstanding issues.

One of the general issues on which input is sought is the extent to which and the nature of problems experienced in trying to enforce a judgment in a foreign country.

Intellectual property issues are high on the list of matters being debated. Chapter 5 of the consultation paper is directed to intellectual property rights’ issues.

The issues include whether or not intellectual property rights should even be included in the judgments covered by the Convention. So draft article 2(m) proposes to exclude judgments about intellectual property rights from the Convention altogether; alternatively, articles 5 and 6 proceed on the basis that intellectual property rights are included. Which approach should it be?

If included, the basic idea is that a judgment on subsistence, ownership or infringement of an intellectual property right made by a Court in the country which granted the right could be enforceable under the proposed Convention to the extent that the judgment dealt with the subsistence, ownership and infringement of the right in that country.

It is proposed to treat judgments about the subsistence, ownership and infringement of registered rights granted by the country where the judgment is made as falling exclusively under the Convention. Judgments about unregistered rights, such as copyright and unregistered designs, would not be exclusive.

According to the consultation paper, one consequence of this arrangement would be that judgments involving “multi-state IP infringements” of registered rights will be enforceable under the Convention only to the extent that the judgment relates to infringements in the country/jurisdiction issuing the judgment.

No doubt for sound philosophical rationalising, trade secrets do not count as intellectual property rights under the draft Convention. Practically speaking from a business’ perspective, however, one might wonder why confidential information should be treated differently to unregistered “rights”.

Another area of issues raised in the consultation paper is the extent to which awards of damages, especially additional or exemplary or otherwise punitive damages, should be capable of enforcement under the Convention.

As the next (and possibly final) meeting of the commission preparing the draft for a Treaty conference is on 24 – 29 May 2018, the deadline for submissions is COB 27 April 2018.

Hague Conference Judgments Project: Recognition and enforcement of foreign judgments

Pregabalin 2 – the invalidity appeal

In addition to clarifying infringement of method claims, the Full Court in Warner-Lambert (Pregabalin) also dismissed Apotex’ appeal against the findings that the Patent was fairly based and not invalidated by a false suggestion.

As you will recall, Warner-Lambert’s patent claimed methods for treating pain using pregabalin. The methods included claims 16 – 30 which were Swiss claims.

Apotex argued that the claims were not fairly based and had been obtained by false suggestion.

The main basis for these attacks stemmed from the parties’ acceptance that the point of the patent was the use of pregabalin to treat humans. However, the examples in the patent related to tests conducted on rats. Apotex argued that it was not certain that a compound shown to be efficacious in rats would necessarily work for humans or, if it did, what a “therapeutically effective amount” for humans would be without a considerable amount of testing and experiment. Apotex argued that the “prolonged research, inquiry or experiment” involved fell well short of what was required for a sufficient description of the invention. (This was the pre-Raising the Bar Act version of s 40(2)(a)). Accordingly, as laid down in Kimberly-Clark:

The question is, will the disclosure enable the addressee of the specification to produce something within each claim without new inventions or additions or prolonged study of matters presenting initial difficulty?

The Full Court accepted that it would be a complicated and expensive business to produce from the information in the Specification a medicament for the treatment of humans. After all, we are talking about a drug. However, the Full Court agreed with the trial judge that the work involved was nonetheless “routine” and did not require invention. For example, at [126] the Full Court accepted:

The need to produce “new inventions or additions” or to carry out “prolonged study of matters presenting initial difficulty” may mean that a description is insufficient. The need for time, cost and detailed work will not; at least where, as here, the work involved is of a routine and conventional kind.

“Routine” in this context was not merely simple and easy. The skilled addressees were scientists with Ph Ds and considerable experience.

An important consideration in reaching this conclusion was the nature of the claimed invention. According to the Full Court, the invention lay in the broad recognition that pregabalin, otherwise a known drug, could be used in the treatment of pain. It was not concerned with any particular dosing regime.

It also appears that (see [39] of the Full Court’s reasons) Apotex’ evidence did not identify any particular problems that would be encountered if one were to embark on formulating the drug for the relevant purpose.

In reaching this conclusion, the Full Court was also highly critical of Apotex’ attempt to characterise the work involved as imposing an “undue burden”. This formulation was derived from EPO and English cases in which the statutory test was close to the Raising the Bar Act formulation:[3]

(a) disclose the invention in a manner which is clear enough and complete enough for the invention to be performed by a person skilled in the relevant art; and

So it was irrelevant to the test under the pre-Raising the Bar Act form of s 40(2)(a) and, in any event, was an unhelpful gloss on the terms of the statute.

Bearing in mind the history of the terminology adopted in the Raising the Bar Act version of s 40 and the similarity of the wording to the EPC / UK Act, it is to be hoped that the High Court’s warnings in Lockwood v Doric not to get entangled in English cases post–1977 will fall away when a case arises under the new form of the provision.

Dr Summerfield addresses the invalidity issues of the appeal here.

Warner-Lambert Company LLC v Apotex Pty Ltd (No 2) [2018] FCAFC 26 (Jagot, Yates and Burley JJ)

How you infringe a Swiss claim in Australia

The Full Court has upheld Nicholas J’s ruling that Apotex infringed the Swiss claims in Warner-Lambert’s (Pfizer’s) pregabalin patent by making the product outside Australia and then threatening to import it into Australia for sale.

Claims 16 to 30 of the pregabalin patent were Swiss claims. For example, claim 16 was for “use of a compound of Formula 1 or a pharmaceutically acceptable salt diastereomer or an enantiomer thereof … in the manufacture of a medicament for the treatment of pain.”

Apotex’ plan was to have its product made overseas by a third party, then import the product and offer it for sale.

As you know, infringement requires the infringer to “exploit” the claim said to be infringed in the patent area.[1] For this purpose, the Dictionary defines exploit to mean:

“exploit ”, in relation to an invention, includes:

(a) where the invention is a product—make, hire, sell or otherwise dispose of the product, offer to make, sell, hire or otherwise dispose of it, use or import it, or keep it for the purpose of doing any of those things; or

(b) where the invention is a method or process—use the method or process or do any act mentioned in paragraph (a) in respect of a product resulting from such use.

Apotex argued that it was not going to infringe because Swiss claims are method claims[2] and so, according to Apotex, could be infringed only by practising the method in Australia. Therefore, according to Apotex, paragraph (b) of the definition of “exploit” should be limited to products made by practising the method in Australia only.

In Lundbeck at [693] – [694], Lindgren J had found infringement in similar circumstances, but through some rather convoluted reasoning. At [167], while rejecting Apotex’ criticisms of Lundbeck, the Full Court upheld the trial Judge’s finding of infringement on the basis of his Honour’s reasoning in preference to Lindgren J’s reasoning. Nicholas J found at [296]- [298]:

296 The definition of “exploit” makes no reference to the patent area. As I have said, the express territorial limitation upon the patentee’s exclusive rights is found in s 12 and s 13. In my respectful view, there is therefore no reason to read down the words of either para (a) or para (b) of the definition of “exploit” to found any territorial limitation. This is because the Act expressly provides that a patent only has effect in the patent area: see also s 70 of the Patents Act 1952 (Cth).

297 Paragraph (b) of the definition of “exploit” refers to the doing of an act referred to in para (a) which includes to make or import a product. The patentee’s exclusive rights are infringed (subject to available defences) if another person does any such act within the patent area. The fact that the patented method is performed outside the patent area does not avoid infringement of a method claim (including a Swiss claim) if the product imported and sold in Australia was made using the patented method because the acts of importation and sale occur within the patent area. The relevant act of infringement is not the use of the method outside the patent area but the exploitation (by importation and sale) in Australia of a product made using the patented method.

298 In my respectful opinion, contrary to the approach taken by Lindgren J, the relevant territorial limitation is reflected in the language of s 12 and s 13(3) and there is therefore no justification for importing words of territorial limitation into the definition of “exploit”. It follows that I take a somewhat different approach to the construction of the definition of “exploit” to that taken by Lindgren J in Alphapharm, though I do not think the difference has any impact on whether or not Apotex threatens to infringe the Swiss claims in this case.

So the question now appears to be “Is the respondent exploiting in Australia a product which was made by a method as claimed in the patent?” It does not matter whether the method was performed in or outside Australia.

If Apotex imported its product as planned, therefore, Apotex would infringe because it would be importing into Australia and then offering for sale a product which had been made by one of the claimed methods. Any other result, of course, would have seriously compromised the utility of method patents.

The Full Court also dismissed Apotex’ appeal against the findings that the Patent was fairly based and not invalidated by a false suggestion. That may be a topic for another day.

 

Warner-Lambert Company LLC v Apotex Pty Ltd (No 2) [2018] FCAFC 26 (Jagot, Yates and Burley JJ)


  1. Or authorise someone else to exploit the invention: s 13.  ?
  2. Otsuka at [120].  ?
  3. Article 83 of the European Patent Convention provides “The European patent application shall disclose the invention in a manner sufficiently clear and complete for it to be carried out by a person skilled in the art.”  ?

Productivity Commission intellectual property arrangements

Part 1 of my article on the Productivity Commission’s Final Report on Intellectual Property Arrangements has been belatedly published in the Australian Intellectual Property Law Bulletin: (2018) Vol. 30 No. 10 p. 210.

Subscription only, I’m afraid.

This part looks at the Productivity Commission’s approach and treatment of patents. Part 2 will deal with copyright, designs and other issues.

This issue of AIPLB also includes a paper by Richard Hamer and Lev Gutkin on patents law in 2016 and Marina Olsen’s review of the Productivity Commission’s recommendations on designs.

Between writing the paper and its publication, the Government has published its response to the Productivity Commission’s report. Despite the Raising the Bar reforms to inventive step, that response included acceptance of the recommendation to change the inventive step requirement yet again. The Government has since published several discussion papers on ways to “reform” inventive step and the requirement for disclosure of the technical advance, a statement of objects and Crown use.

Patenting gene association analyses for cattle in Australia

In a mammoth decision, Beach J has held that Branhaven’s patent application, No 2010202253, entitled “Compositions, methods and systems for inferring bovine traits” “is deficient in terms of:

(a) lack of clarity;

(b) a failure to define the invention; and

(c) related to some questions of construction, lack of utility.”

His Honour, however, rejected attacks on the basis of manner of manufacture, novelty, inventive step and fair basis. Branhaven will be given time (usually 60 days) to consider whether it can amend to overcome the objections.

At 949 paragraphs there is more than a little light reading!

The ABC has an excitable summary here.

Meat & Livestock Australia Limited v Cargill, Inc [2018] FCA 51

Confidentiality orders in court proceedings

Motorola is suing Hytera for infringement of its patents relating to mobile phone technology.1 As part of the proceeding, Hytera is seeking to invoke a Digital Mobile Radio Essential Properties Cross Licence Agreement. Hytera has obtained an order that information about various terms in the agreement be kept confidential (I.e., suppressed) for 10 years after the proceeding is decided.

Section 37AF of the Federal Court of Australia Act provides the Court with power to suppress or restrict the publication of evidence. In the case of confidential information, such as trade secrets, the party seeking to restrict access to the information must show under s 37AGthat the restriction “is necessary to prevent prejudice to the proper administration of justice”.

Perram J noted that some scepticism might be felt towards the idea that protection of confidential information met the strict standard of necessity. His Honour accepted, however, case law recognised that commercial sensitivity, especially if it were likely that competitors could benefit from information which made public through the Court system, is a circumstance in which the necessity standard could be met.The integrity of the litigious process might be undermined if parties were precluded from advancing relevant information as a result of the harm potentially flowing from publication. In this case, the agreement in question was still on foot. And the information would place Hytera at a competitive disadvantage in future negotiations with third parties. At [15], his Honour explained:

disclosure of the information would be prejudicial to the proper administration of justice because it would tend to ‘destroy or diminish’ (Origin Energy at 148) the value of confidential information with the possible consequence that commercial parties will be more reticent to approach the Court to settle their disputes. I am therefore satisfied that an order under s 37AF in this case is appropriate.

Perram J was not prepared, however, to grant Hytera’s request that the information be kept sealed for 10 years. There was no evidence about the nature and lifespan of the digital mobile radio technology in issue or the life cycle of the telecommunications standards. Having reviewed the agreement and the substance of the information that had been disclosed, Perram J was prepared to order suppression for three years only. His Honour was prepared to reconsider if further evidence were put on.

If you are going to seek suppression orders – i.e, that information be kept confidential, therefore, you will need to lead evidence which establishes (1) that the information is in fact confidential and (2) there is a real risk of prejudice if the confidentiality is not preserved. Another factor which the Court seems to be mentioning more often was that the affidavit evidence was through the solicitor “on information and belief”, rather than from someone knowledgeable within Hytera itself.

Motorola Solutions, Inc. v Hytera Communications Corporation Ltd (No 2) [2018 FCA 17

  1. Apparently, the trial is scheduled to run for 5 weeks. There are also parallel actions in the USA, China and Germany. ?
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