10 December 2008

Merck & Co. had successfully opposed Sherman’s application for a patent.  Sherman appealed to the Federal Court from that rejection.  Merck subsequently withdrew from the proceeding in the Court and the Commissioner was added as a party.  The Commissioner filed an affidavit exhibiting a copy of the delegate’s decision upholding the opposition and the declarations which Merck had relied on in the opposition.

The trial judge ruled these materials were inadmissible.  The Full Court (Heerey, Kenny and Middleton JJ) upheld the Commissioner’s appeal against this exclusion of material. 

When an appeal is brought in the Federal Court from the Commissioner (or the Registrar of Designs or of Trade Marks), FCR O 58 r8 provides that evidence before the Commissioner may, with leave of the Court and saving all just exceptions, be admissible in the Court.

Unlike the usual situation in “appeals” of this kind where the parties to the opposition may be relying on the statutory declarations they had filed in the Office, Merck had withdrawn and so the statutory declarations of its witnesses were hearsay – presumably, the Commissioner did not intend, or was unable, to call them.

The Full Court confirmed that the rules of evidence still apply to the evidence sought to be “uplifted” so that, if there are objections such as that the evidence is hearsay, evidence which was before the Commissioner may be excluded before the Court.  However, the Full Court went on to find that both the decision and the declarations were admissible.

The delegate’s decision itself was relevant on two bases (at [37]):

First, the fact that it was made was a fact on which the jurisdiction of the Court depended.

Secondly (and more substantively), the Commissioner’s decision and the reasons for it were admissible before the Court as a form of expert evidence because (unlike the Court) the Commissioner (and the various Registrars) is credited with having some technical expertise which the Court is entitled to take into account.

As the decision itself was relevant and admissible, the Full Court went on to hold that so too were the materials on which it was based.

The weight actually to be accorded to the Commissioner’s decision ultimately would depend on what other evidence was adduced before the Court.

Depending on the extent to which the evidence before the Commissioner and the Court overlaps, the decision-maker’s opinion on these matters carries some weight in the Court’s assessment. Viewed in this way, the decision of the delegate is plainly not inadmissible on the ground that it is irrelevant. 

The Full Court noted that, because the declaratory evidence was admissible on the grounds that it was relevant to an understanding of the Commissioner’s decision, it was admissible for all purposes.  Further, however, the Full Court agreed with Lindgren J’s analysis in Alphapharm v Lundbeck (at [762 – 770]) of why articles cited by an expert were admissible even though hearsay.  

The Court did not address Heerey J’s earlier decision in Cadbury v Darrell Lea (No. 3) in which market survey reports were excluded as ‘double’ hearsay.  It would seem that the difference is that in Sherman and Lundbeck the materials were adopted or referred to by the expert as the basis for the expert opinion.

Commissioner of Patents v Sherman [2008] FCAFC 182.