amendment

Refusing a lapsed patent application and other powers of the Commissioner

The Commissioner of Patents has power to refuse an application even after it has lapsed (but is still capable of revival by payment of “late” fees). The Full Court has also affirmed the Commissioner’s power to set a two month time limit for response (especially where she actually allows six months) and to institute a hearing on her own motion.

In some ways, this is a “silly” case, but it does explain how the application process and restoration of a lapsed application works. The chronology was as follows:

  • In December 2011, Miles requested examination of his patent application.
  • In May 2012, the Commissioner’s delegate raised objections to grant, giving Miles two months in which to overcome the objections or risk the Commissioner making a direction to amend under s 107 or refusing the application.
  • Miles did not respond.
  • In September 2012 (i.e., 4 months later), the Commissioner wrote advising that, as no response had been received, the matter would be set down for hearing and allowing one month for submissions to be filed. The Commissioner’s letter warned that it was possible for the Commissioner to refuse the application or direct amendment and inviting Miles to submit his own amendments.
  • October 2012 was the fifth anniversary of the application and continuation fees were payable. Miles did not pay the continuation fees.
  • On 1 November 2012, the Commissioner refused Miles’ application on the basis that objections to grant had been appropriately raised and not overcome.
  • On 28 March 2013, Miles paid the continuation fee (under s 142) and sought to amend the patent application.

The Commissioner said “bad luck, your application has already been refused” (or words to that effect).

Miles sought judicial review under s 39B of the Judiciary Act unsuccessfully. The Full Court (Bennett, Greenwood and Middleton JJ) dismissed his appeal.

Miles’ first argument was that the Commissioner had no power to refuse his application (in November 2012) because his application had already lapsed in October 2012 when he failed to pay the continuation fees.

The Full Court was having none of that. It was predicated on a misunderstanding of reg. 13.3(1) and 13.3(1A). Section 142(2)(d) provides that a patent application lapses if the applicant does not pay a continuation fee within the “prescribed period”. What constitutes the “prescribed period” is defined by reg. 13.3(1) and (1A):

(1) For paragraph 142(2)(d) of the Act:

>(a) a continuation fee for an application for a standard patent is payable for a relevant anniversary at the last moment of the anniversary; and

>(b) the period in which the fee must be paid is the period ending at the last moment of the anniversary.

(1A) However, if the continuation fee is paid within 6 months after the end of the relevant anniversary (6 month period):

>(a) the period mentioned in paragraph (1)(b) is taken to be extended until the fee is paid; and

>(b) the continuation fee includes the additional fee stated in item 211 of Schedule 7; and

>(c) the additional fee is payable from the first day of the 6 month period.

Reg. 13.3(1) and (1A) were not to be read in some bifurcated manner, but in combination. This meant that, if the continuation fee was paid in the 6 month grace period, the “prescribed period” was extended up until the date the fee was paid, i.e. 28 March 2013. As the continuation fee was paid in this case within the 6 month period, therefore, the application was still on foot when the Commissioner refused it in November 2012.

The Full Court went on to reject Miles’ arguments that the Commissioner had no power to set a two month time limit for response to the Examiner’s report in May 2012[1] or to unilaterally institute a hearing.

One “odd” outcome of this, however, is that Miles’ application would indeed have lapsed in October 2012 if he had not paid the continuation fee in the grace period. In that case, the Commissioner would not have had power to refuse the application. I am not sure how that would help Miles either as, presumably, by that stage it would be too late to file another application.

Miles v Commissioner of Patents [2014] FCAFC 109


  1. The Full Court essentially adopted the primary judge’s reasons at [55] to [93] and pointed out that Miles had been given opportunitites to address the grounds of objection and had failed to take any of them up.  ?

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IPSANZ and patent amendments

One of the interesting sessions at the IPSANZ conference was David Catterns QC and the 2 Gregs talking about amending patent specifications – before and after grant.

I certainly wouldn’t disagree with the view that, all other things being equal, you should amend before litigation rather than during (although how often are all other things equal, especially for patents in multiple jurisdictions). Australian law, at least insofar as it concerns amendments before the Commissioner, however, may be moving closer to the New Zealand situation.

The Intellectual Property Laws Amendment (Raising the Bar) Bill 2011 includes in Sch 1 at item 31 an amendment to s 102:

(2D) An amendment of a patent request or a complete specification is not allowable if it is of a kind prescribed by regulations made for the purposes of this section.

For some reason I have a (vague) recollection that this provision may be used to confer on the Commissioner through the Regs a discretion similar to that which the Court has under s 105. I am afraid I have not been able to re-locate wherever it was that I read or heard this.

Does anyone know any better or differently?

It doesn’t seem to be what the EM contemplates as the role for item 31 and one might have thought that there might be scope to expand the regulations made for the purposes of s 104 to effect that goal (if it were intended to be achieved) as it is the “narrowness” of those regulations which leads to the present situation.

One might question the constitutional desirability of putting such ‘substantive’ matters in the Regs rather than expressing them in the Act itself. However, that fight seems, sadly, to have been well and truly lost. In any event, if the introduction of such a discretion in the Commissioner be intended, it would surely be in everyone’s interests to amend the terms of s 104 itself to track the terms of s 105(1) rather than bury it away in the Regs.

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Who can enforce a release

Global Brands is still suing YD Pty Ltd. The trial on quantum for infringement of registered design was almost due to start when YD applied to amend.

After YD admitted it had infringed Global Brands’ registered design, YD discovered, over 9 months earlier, that Global Brands had entered into a settlement agreement with Pegasus/Coastal relating to Global Brands allegations that Pegasus/Coastal had infringed the same registered design. The settlement agreement was in fairly typical terms:

the parties (and any related body corporate as that term is defined in s 9 of the Corporations Act 2001 (Cth) (Related Bodies Corporate) hereby permanently release and forever discharge each other, their Related Bodies Corporate, directors, customers, servants and agents from and against all and any claim cause of action liability suit or demand which the parties … have or but for this deed may have had against each other…their customers servants or agents prior to the date of this deed for or in respect of or arising out of the subject matter or the conduct of the proceeding and the cross claim.

YD claims that Pegasus/Coastal supplied the infringing products to it and so it was a customer within the terms of the release. Pegasus/Coastal apparently did not want to become embroiled in the litigation. The amendment was to join Pegasus/Coastal as a respondent and to rely on the release.

Dodds-Streeton J has granted leave to amend, finding that YD although not a party to the settlement deed could rely on it as a special exception to the rules on privity, so long as Pegasus/Coastal was joined as a respondent.

Aon Risk Services was distinguished:

In all the unusual circumstances of this case, including:
the existence of the release, its apparent relevance as the basis for an arguable claim; its relatively circumscribed scope; the respondents’ belated knowledge of the deed and their conduct thereafter; the impact of the decision in Airberg only recently appreciated by the respondents’ counsel; the applicants’ preference that the quantum trial should not proceed if the amendments be allowed; the fact that although the proceeding has been long on foot, there has already been one trial and the parties have apparently acquiesced in various stages of non-progression:
in my opinion, weighing all relevant matters, including the nature and importance of the amendment to the respondents, notwithstanding the delay, wasted costs and prejudice to the applicants (which may not be wholly compensable by a costs order) the respondents’ applications to amend and to join Pegasus should be allowed.

Global Brands apparently denies that YD is a “customer” and, in any event, apparently intends seeking rectification to exclude the term as a “mistake”.

All this has led to the vacating of the trial date.

Global Brand Marketing Inc v YD Pty Limited [2010] FCA 323

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University of WA v Gray (No. 24)

What do you do if you have an appeal on foot, but the other side starts selling off the subject matter of the dispute?

Now that French J has gone on to loftier planes, Siopis J has inherited this behemmoth.

In the principal proceedings, the University had sued Dr Gray claiming (in very broad terms) that he had invented some very successful the micro sphere technologies while an employee with the consequence that he held the rights to the technologies on trust for the University.  Dr Gray, however, had sold the IP to Sirtex in which, after its public listing, he became the owner of a large parcel of shares.

Dr Gray and Sirtex had given undertakings not to deal with the IP or the shares pending trial of the matter.

The action failed, but the University has appealed and the appeal is due to be heard in November.  

The undertakings also lapsed when French J gave his judgment.  Dr Gray and Sirtex refused to continue the undertakings pending the appeal.  Despite diligent monitoring by the University’s solicitors, Dr Gray sold both his shares in Sirtex to another company, ACN, of which he was the sole shareholder and director.

The University did two things.  First, it sought interlocutory injunctions against Dr Gray and ACN to restrain dealing in the shares in ACN and the proceeds of the sale of the shares to ACN.  Secondly, it sought to amend the application in the original proceeding to add ACN as a party and bring new claims against it – remember, judgment has already been given and there is an appeal on foot.

While Siopis J acknowledged there were cases where originating documents and pleadings could be amended, even after judgment, this was not one.

13 In my view, O 13 is not to be construed as permitting the amendment of the originating application or pleadings to plead causes of action based on facts and matters which occurred after the date of the judgment. A construction of the Rules which would permit amendment in those circumstances would be inconsistent with the finality principle and the principle that an appeal in this Court is by way of a rehearing directed at correcting error. (See Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd (2001) 117 FCR 424 at 432-440.) The policy considerations militating against the University’s contention are expressed in the following observations of Gibbs CJ, Wilson, Brennan and Dawson JJ in Coulton v Holcombe (1986) 162 CLR 1 at 7:

It is fundamental to the due administration of justice that the substantial issues between the parties are ordinarily settled at trial. If it were not so the main arena for settlement of disputes would move from the court of first instance to the appellate court, tending to reduce the proceedings in the former court to little more than a preliminary skirmish.

So, the amendment application was refused.  However, the interlocutory injunction was granted and the University ordered to commence a separate proceeding against Dr Gray and ACN within 7 days.

University of Western Australia v Gray (No 24) [2008] FCA 1400

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