judiciary act

Aristocrat lives to fight another day

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O’Bryan J has granted Aristocrat leave to appeal Burley J’s decision ruling that the remitted claims were not patentable subject matter.

Recap

O’Bryan J sets out a convenient summary of how the case came to be before him and IPwars has had a few goes including here and here but in case the meaning of “manner of manufacture” for the purposes of the Patents Act 1990 is not tattooed over you heart, a brief recap:

  1. The Commissioner rejected Aristocrat’s innovation patents over an electronic gaming machine (EGM) with a new software-implemented feature game and trigger.
  2. Burley J allowed Aristocrat’s appeal, pointing out it was accepted on all sides that the claims would have been patentable if implemented in the traditional mechanical way rather than software implementation.
  3. The Full Federal Court allowed the Commissioner’s appeal restoring the rejection of the claims. Although agreed in the result, the reasoning was divided. Middleton and Perram JJ held at [26] that it was first necessary to decide if the claimed invention was for a computer or computer-implemented. If so, it was then necessary for the claim to result in an advance in computer technology. In the result (and subject to any appeal to the High Court), after setting aside Burley J’s orders, the Full Federal Court ordered: The proceedings are remitted to the primary judge for determination of any residual issues in light of the Full Court’s reasons including any issues which concern the position of claims other than claim 1 of Innovation Patent No. 2016101967 (referred to at [8] of the reasons of the primary judge dated 5 June 2020) and the costs of the hearings before the primary judge.
  4. The High Court memorably failed to reach a decision, with three judges dismissing the appeal while the other three judges would have allowed Aristocrat’s appeal (a seventh judge was unable to sit). Consequently, under Judiciary Act 1903 s 23(2)(a), the decision of the Full Federal Court was affirmed.
  5. On remitter, Burley J considered he was bound by the Full Federal Court’s decision and ruled that the dependent claims of Aristocrat’s patents were also invalid.

Leave to appeal

As Burley J was hearing and determining an appeal from a decision of the Commissioner, Aristocrat needed leave to appeal to the Full Court under s 158(2).

Often where leave is being sought by the patentee or applicant for the patent rather than an opponent, one might expect leave would be granted as otherwise the patent is dead. As O’Bryan J explained at [50]:

The guidance that emerges from the above cases may be summarised as follows. Section 158(2) evinces a legislative policy against the bringing of appeals against a judgment or order of a single judge of the Federal Court in the exercise of its jurisdiction to hear and determine appeals from decisions or directions of the Commissioner except where the court, acting judicially, finds reason to grant leave. The discretionary power to grant leave is not constrained by express legislative criteria and the Court should not lay down rigid rules that would restrict the exercise of the discretion given the diversity of cases to which s 158(2) will potentially apply. In determining whether to grant leave, it is relevant to consider: whether the decision is attended with sufficient doubt to warrant it being reconsidered on appeal; whether the issues proposed to be raised by the appeal are of general application; and the consequences of a refusal to grant leave – particularly whether the refusal will finally determine the matter. None of those considerations is determinative in and of itself and the considerations are interrelated. The cases make clear that the degree of doubt with respect to the decision that would warrant a grant of leave is affected by the consequences of a refusal to grant leave. In a pre-grant opposition proceeding, where there have been two hearings with the opposition dismissed, and where the opponent of the patent will still be able to institute revocation proceedings, leave to appeal will often be granted only where the opponent has demonstrated a clear prima facie case of error in the decision appealed from. In contrast, where an opponent has been successful such that the decision will be final with respect to the grant of the patent, leave to appeal would ordinarily be granted where the grounds are arguable.

O’Bryan J appears to have had some reservation in granting leave this time around. His Honour described the application as “finely balanced”.

The two main areas that seem to have been particularly troubling were that, as the Commissioner characterised it, the parties had agreed that Burley J’s determination of claim 1 in the first hearing would guide the determination of the other claims. Secondly, the innovation patents in question had expired and Aristocrat still had applications for standard patents covering the same subject matter pending.

Ultimately, his Honour found in favour of granting leave in the “unusual circumstances” of this case.

The factor that appears to have tipped his Honour in favour of granting leave was not just that the High Court had divided 3:3 in its previous decision. O’Bryan J was sceptical that this was just Aristocrat trying to have a “second go”. Rather, the additional factor is how s 23 of the Judiciary Act should apply in circumstances where all six judges of the High Court appear to have rejected the majority view in the Full Federal Court.

At [65], O’Bryan J explained:

Having taken all of the foregoing factors into account, I have determined on balance that leave to appeal should be granted. Ultimately, two factors weigh marginally in favour of the grant of leave: that the effect of the primary judgment is to determine finally that the innovation patents in suit will not be granted, and that the grounds of appeal sought to be raised by Aristocrat are arguable (raising novel questions about the operations of s 23(2)(a) in the unusual circumstances of this case). If Aristocrat is able to persuade an appellate court that the primary judge’s application of s 23(2)(a) of the Judiciary Act in this case was erroneous, Aristocrat should be entitled to have the residual claims adjudicated in accordance with the legal principles that the appellate court determines are applicable.

What happens next

Having been granted leave to appeal, Aristocrat has foreshadowed an application under Judiciary Act s 40 requesting the High Court to hear and determine the appeal without the need for a further hearing in the Full Federal Court. This is of course a very unusual step. In this case, however, the foundational question can really be answered only by the High Court: how does s 23(2)(a) operate when the decision under appeal is affirmed but all the High Court judges sitting on the appeal appear to have rejected the reasoning of the “affirmed” decision?

Who know, we might even get something approaching a settled test for “manner of manufacture” (again).

Aristocrat Technologies Australia Pty Limited v Commissioner of Patents [2024] FCA 987

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Moral rights and the statute of limitations

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Ms Skildum-Reid’s application for preliminary discovery against the University of Queensland (UQ) has failed for a number of reasons, the most interesting of which is Derrington J’s ruling that it is likely that a six year statute of limitations applies to infringements of moral rights.

Some background

Ms Skildum-Reid is a corporate sponsorship consultant, adviser, speaker and author. Over the years since 2006, she has given presentations at various workshops. In the course of doing so, Ms Skildum-Reid developed one or more slide decks.

In July 2023, Ms Skildum-Reid discovered through internet searches some 15 slide decks with 79 instances of what she considered plagiarism being, or having been used, in two marketing courses being run by UQ.

Through her lawyers, Ms Skildum-Reid wrote to the University stating (amongst other things):

In addition to the egregious and blatant infringement of our client’s Copyright Works, our client considers the unauthorised use of the Copyright Works by the University without any accreditation or reference to her as author (in breach of her moral rights in the Copyright Works) to constitute plagiarism and serious academic misconduct on the part of the UQ staff members who have been responsible for delivering/presenting the UQ Courses.

Correspondence between the parties’ lawyers followed, without resolving the dispute.

Ms Skildum-Reid then brought a preliminary discovery application against the University under both FCR 2011 r 7.22 and r. 7.23. That is, seeking discovery from the University of documents or information to enable her to identify a prospective respondent or, alternatively, whether she had a right to relief against the prospective respondent.

In responding to the application, however, the University provided evidence from the person running the course, a Dr Chien, that she was simply using and updating slide decks provided to her by the University when she took over the course in 2009, some 15 years earlier.

The problem

This evidence caused considerable consternation in Ms Skildum-Reid’s camp. Ms Skildum-Reid wanted to identify who were the person(s) who had prepared the slide decks passed on to Dr Chien.

As those events occurred more than six years previously, Ms Skildum-Reid ran into the limitation of actions provided by Copyright Act 1968 (Cth) s 134(1):

An action shall not be brought for an infringement of copyright or in respect of the conversion or detention of an infringing copy, or of a device (including a circumvention device) used or intended to be used for making infringing copies, after the expiration of six years from the time when the infringement took place or the infringing copy or device was made, as the case may be. (emphasis supplied)

and the University made it plain it intended to rely on s 134(1).

At the hearing of the application for preliminary discovery, Ms Skildum-Reid sought to modify her claims to include infringement of her moral rights.

By this stage, Ms Skildum-Reid had realised that any claims of copyright infringement against whomever had prepared the slide decks provided to Dr Chien were well and truly statute barred. Ms Skildum-Reid’s argument was quite simple. Section 134(1) applies only to infringement of copyright. Infringement of moral rights is not infringement of copyright so, therefore, s 134(1) has no application.

An attempted solution

The argument is that infringement of copyright is defined by ss 36 to 38 in Part III and ss 101 to 102 in Part IV. So, for example, s 36(1) provides in part that “copyright subsisting in a literary, dramatic, musical or artistic work is infringed by ….”[1] (emphasis supplied)

And, further, what constitutes copyright is defined by s 31 “Nature of copyright in original works” in the case of original literary, dramatic, musical and artistic works[2] and ss 85 – 88 in the case of other subject matter. None of these provisions confers a right of attribution or a right of integrity.

Moral rights while subsisting in original works and other (Part IV) subject matter, are not “copyright” and do not arise under Part III (original works) or Part IV (other subject matter). Instead, moral rights arise under Part IX – all the way down in s 189 and following.

These provisions include separate provisions about infringement. So, for example, s 195AO provides:

… a person infringes an author’s right of attribution of authorship in respect of a work if ….

Sections 195AP and 195AQ make corresponding provision for infringement of the moral rights of integrity and against false attribution.

No mention of “copyright” in any of them.

Despite running (in the case of “author’s rights) all the way down to s 195AZO, there is no counterpart to s 134. The Copyright Act does not in terms include a statute of limitations on moral rights claims.

The University, however, sought to invoke the six year statute of limitations on claims of tort arising under Queensland state law[3] which, the University contended, applied through s 79(1) of the Judiciary Act 1903 (Cth):

The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable.

The State statute of limitations applied

At [40] – [42], Derrington J cited the High Court’s interpretation of the role of s 79 as filling any “gaps” in Federal law by allowing the application of the relevant state or territory law in such cases.[4]

Derrington J could discern nothing in the Copyright Act or the Explanatory Memorandum for the bill introducing moral rights to suggest that a limitations period for moral rights had been deliberately excluded. Accordingly, there was a “gap” and it was generally accepted infringement of copyright, while statute based, was tortious conduct.

Rule 7.22 requires only that the prospective applicant for preliminary discovery may have a claim, not a prima facie case. Derrington J considered, however, it was still necessary to take into account the prospects of success. Pointing out at [53]:

…. It would be productive of wasted time and money to require a person to make discovery of documents to a prospective applicant in circumstances where, if the contemplated action were pursued, it would necessarily fail.

His Honour found that it was unlikely Ms Skildum-Reid would be able to avoid the operation of the Queensland Limitations of Actions Act. Accordingly, her application under r. 7.22 failed. At [54], his Honour concluded:

Here, no answer was provided to the prospective respondents’ submissions that the claims sought to be made would be barred by s 10 of the Limitation of Actions Act. Though there may be arguments that actions for the infringement of statutory intellectual property rights are not tortious in nature so that s 10 of the Act does not apply to them, such arguments would have to overturn long lines of authority to the contrary. The prospect of doing so is unlikely. In those circumstances, the prospective applicant has not established for the purposes of r 7.22(1)(a) that she may have a right to obtain relief against the unidentified previous course co-ordinator or guest lecturer for infringement of her moral rights.

The prospects of a successful claim, or rather the lack of prospects, also meant Derrington J would not have exercised the discretion in favour of ordering preliminary discovery.

Rule 7.23

Ms Skildum-Reid’s application for preliminary discovery under r 7.23 ran into other difficulties. The main problem being, having accused the University of “egregious and blatant” copyright infringement, it was rather difficult to satisfy the requirement that Ms Skildum-Reid had insufficient information to decide whether to sue or not.

Having made allegations in “emphatic and unequivocal terms”, there was nothing in her evidence explaining why she had insufficient information to decide whether to proceed. At [88] – [89]:

…. It might be inferred from her affidavit material that she believes that she has claims against the prospective respondents. However, there is nothing to suggest that her belief is only that she may have claims against them. No statement of uncertainty about the veracity of her anticipated claims, or why that uncertainty might exist, is provided. Further, she did not identify what information she lacked but needed in order to decide whether to start proceedings. (original emphasis)

These were fatal omissions. Whilst it might occasionally be possible to attribute to the prospective applicant the assertions of their solicitor or counsel for the purposes of establishing the reasonable belief, the drawing of that inference can be difficult. It is preferable, on any application for there to be direct evidence of the prospective applicant’s belief for the purposes of subparagraph (1)(a) and of the lack of information which prevents a decision being made for the purposes of (1)(b). Here, none of those matters were addressed in the affidavits relied upon.

Skildum-Reid v University of Queensland [2024] FCA 733

  1. Section 101 makes similar provision: “a copyright subsisting by virtue of this Part is infringed by ….”  ?
  2. In the case of literary, dramatic and musical works, the familiar rights to reproduce the work in a material form, publish it (for the first time), perform it in public, communicate it to the public etc.  ?
  3. s 10 of the Limitation of Actions Act 1974 (Qld). Every state and territory has equivalent legislaton.  ?
  4. Rizeq v Western Australia (2017) 262 CLR 1 at [16] (Kiefel CJ) and [90] (Bell, Gageler, Keane, Nettle and Gordon JJ).  ?

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