FEDERAL COURT OF AUSTRALIA

CQMS Pty Ltd v Simco Mining Products & Services Pty Ltd [2014] FCA 1423

THE COURT ORDERS THAT:

1.    the complete specification of Australian patent number 2012100452 be amended in the terms specified in annexure “AL-31” to the affidavit of Adam Luxton filed 18 October 2013; and

2.    the complete specification of Australian patent number 2012100453 be amended in the terms specified in annexure “AL-35” to that affidavit.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE PROCEEDINGS

1    The applicant (“CQMS”) has commenced proceedings alleging infringement of innovation patents AU2012100452 (“patent 452”) and AU2012100453 (“patent 453”). The respondent (“Simco”) cross-claims for revocation of both patents. On 18 October 2013 CQMS filed an interlocutory application, seeking the following orders:

1.    Pursuant to s 105(1) of the Patents Act 1990 (Cth) orders that:

(a)    the complete specification of Australian [patent 452] be amended in the terms specified in annexure AL-31 to the affidavit of Adam Luxton affirmed 17 October 2013;

(b)    the complete specification of Australian [patent 453] be amended in the terms specified in annexure AL-35 to the affidavit of Adam Luxton affirmed 17 October 2013.

2.    Such order as to costs which the Court considers appropriate.

3.    Any other orders which the Court considers necessary.

I shall refer to the Patents Act 1990 (Cth) as the “Patents Act”.

The Patents

2    Excavator buckets frequently have “teeth” protruding from their rims. These teeth are digging implements. They are subjected to substantial wear and tear as a result of the longitudinal, vertical and transverse forces applied to them in the course of the digging operation. Because of such wear and tear, they must be replaced from time to time. Commonsense dictates that such replacement should be relatively easy and quick. However, if the mechanism which enables easy and swift replacement also allows movement of the tooth relative to the bucket, then there will be increased wear and tear. Thus there are a number of patented methods and devices designed to minimise wear and tear, whilst at the same time facilitating easy replacement. At least some of these methods and devices involve the use of an “adaptor” which can be fitted to a bucket, and to which the wear member or tooth can then be connected. Numerous such methods and devices are described in patents 452 and 453. Concerning the prior art, patents 452 and 453 assert:

While generally satisfactory for their intended purpose, the abovementioned prior art all suffer from one or more shortcomings or disadvantages in terms of inadequate resistance to rotation of a tooth off a nose or an adaptor under the influence of vertical loads applying a rotational moment to the tooth, a predisposition to premature wear, difficulties in retention of the teeth on noses or adaptors, inadequate locking systems and unduly complicated configurations giving rise to increased fabrication costs.

Furthermore, the prior art all generally rely on lock assemblies that require threaded components. Thread components in lock assemblies are generally disadvantageous as dirt and fines can infiltrate the threaded assembly thereby causing cementation and resulting in difficulties in removal.

3    In patent 452 the invention is described at p 8 ll 1 – 7 as:

… an excavator wear assembly comprising:

an adaptor having a spigot portion, the spigot portion having a transverse dimension;

a wear member releasably mountable on the adaptor, the wear member having a body with a socket cavity, the socket cavity adapted to receive the spigot portion of the adaptor, the wear member further including a pair of mounting ears extending from the body, each of the mounting ears having a transverse dimension;

… .

4    In patent 453 the invention is described at p 7 l 22 to p 8 l 6 as:

… a lock assembly for an excavator wear assembly, the lock assembly comprising:

a locking pin having at least one dowel extending outwardly therefrom;

a retaining member having a seat and a cavity; and

a biasing member located within the cavity of the retaining member;

wherein the biasing member is adapted to exert a biasing force on the dowel to releasably retain the dowel within the seat of the retaining member.

This description is misleading. Patent 453 actually claims a wear member.

ALLEGED INFRINGEMENT AND ALLEGED INVALIDITY

5    On 11 December 2012 Mr Adam Luxton, a partner in Messrs Fisher Adams Kelly, Patent and Trademark Attorneys, acting on behalf of CQMS, forwarded a letter to Simco. The letter asserted that:

    CQMS was the patentee of patents 452 and 453; and

    Simco was infringing the patents.

6    By letter dated 18 December 2012, Messrs Ahearn Fox, Patent and Trademark Attorneys, acting on behalf of Simco:

    denied infringement;

    asserted that patent 452 was anticipated “by a number of admitted prior art documents”;

    asserted that patent 453 was “nonsensical” and anticipated by some of the prior art documents identified in the patent; and

    asserted that CQMS had made unjustified threats.

7    On 21 December 2012 CQMS commenced infringement proceedings against Simco. On 22 March 2013 Simco filed and served its defence, cross-claim and particulars of invalidity. Mr Luxton reconsidered the validity of the patents in light of Simco’s pleadings. By about 10 April 2013 he had formed the view that there was a problem with the priority date of patent 452, although such problem did not affect validity. He had also concluded that one of the items of prior art cited by Simco anticipated claims 1 to 3 of patent 452. He further concluded that “in light of a number of items of prior art cited by [Simco] against [patent 453] all of the claims of [patent 453] are not novel”. Between May and July 2013, the parties negotiated concerning their differences, but no agreement was reached. At some stage Mr Luxton suggested that CQMS should apply to amend the patents to address the objections raised by Simco as to lack of novelty. On 30 August 2013 CQMS lodged notices of intention to amend both patents, such applications being pursuant to s 105 of the Patents Act. Notice of the proposed amendment of patent 452 was advertised on 26 September 2013. The notice in respect of patent 453 was advertised on 10 October 2013.

THE ORIGINAL CLAIMS AND THE PROPOSED AMENDED CLAIMS

8    Existing claim 1 of patent 452 is as follows:

An excavator wear assembly comprising:

an adaptor having a spigot portion, the spigot portion having a transverse dimension;

a wear member releasably mountable on the adaptor, the wear member having a body with a socket cavity, the socket cavity adapted to receive the spigot portion of the adaptor, the wear member further including a pair of mounting ears extending from the body, each of the mounting ears having a transverse dimension, each of the mounting ears also having a top face and a bottom face that are arranged such that both the top and bottom faces are aligned to converge;

wherein, the transverse dimension of each mounting ear is in the range of 0.25 to 0.4 of the transverse dimension of the spigot portion.

9    CQMS seeks to amend existing claim 1 by adding at the end thereof the words, “and wherein a locking aperture extends through one of the mounting ears from an outer face to an inner face thereof”. Apparently this amendment will also deal with Mr Luxton’s concerns about existing claims 2 and 3, probably because those claims are dependent on claim 1.

10    In patent 453 the existing claims are as follows:

1.    An excavator wear member comprising:

a locking aperture extending through a side wall of the excavator wear member, the locking aperture having a receiving passage and a

retaining recess;

wherein, the receiving passage extends inwardly from an outer face of the side wall and the retaining recess is located on an inner face of the side wall such that the receiving passage terminates at retaining recess.

2.    An excavator wear member as claimed in claim 2, wherein the excavator wear member further comprises a body and a mounting ear extending rearwardly of the body, the locking aperture extending through the mounting ear.

3.    An excavator wear member as claimed in any one of the previous claims, wherein a locking face is located at an inner end of the retaining recess.

4.    An excavator wear member as claimed in any one of the previous claims, wherein the receiving passage has a generally circular main portion and the retaining recess has a generally circular main portion, wherein the generally circular main portion of the receiving passage is concentric with the generally circular main portion of the retaining recess.

5.    The excavator wear member of claim 4, wherein the generally circular main portion of the retaining recess has a larger diameter than the generally circular main portion of the receiving passage.

11    CQMS seeks to amend all of the existing claims of patent 453 so that they read as follows, deletions being crossed out and additions, underlined:

1.    An excavator wear member comprising:

a body;

a side wall having a mounting ear extending rearwardly of the body;

a socket cavity extending into the body and at least partially defined by the side wall, an upper wall and a lower wall, the socket cavity being symmetrical about a horizontal plane of the excavator wear member;

a locking aperture extending through thea side wall of the excavator wear member, the locking aperture having a receiving passage having a generally circular main portion and a retaining recess having a generally circular main portion that is generally concentric with the generally circular main portion of the receiving passage;

wherein, the receiving passage extends inwardly toward the socket cavity from an outer face of the side wall and the retaining recess is located on an inner face of the side wall and the diameter of the generally circular main portion of the retaining recess is larger than the diameter of the generally circular main portion of the receiving passage such that the receiving passage terminates at the retaining recess, and wherein a planar locking face is located at an end of the retaining recess proximal the receiving passage.

2.    An excavator wear member as claimed in claim 12, wherein at least a part of the excavator wear member further comprises a body and a mounting ear extending rearwardly of the body, the locking aperture extending extends through the mounting ear.

3.    An excavator wear member as claimed in any one of the previous claims any one of claims 1, 2, 4 or 5, wherein a locking face is located at an inner end of the retaining recessthe planar locking face faces inwardly towards, and is open to, the socket cavity.

4.    An excavator wear member adapted to be releasably mountable on an adaptor, the adaptor having a spigot portion and a mounting recess located on a side wall of the adaptor, the excavator wear member comprising:

a body;

a side wall having a mounting ear extending rearwardly of the body and adapted to be at least partially located within the mounting recess of the adaptor;

a socket cavity extending into the body and at least partially defined by the side wall, an upper wall and a lower wall, the socket cavity being symmetrical about a horizontal plane of the excavator wear member and adapted to receive the spigot portion of the adaptor;

a locking aperture extending through the side wall of the excavator wear member, the locking aperture having a receiving passage having a generally circular main portion and a retaining recess having a generally circular main portion that is generally concentric with the generally circular main portion of the receiving passage;

wherein, the receiving passage extends inwardly toward the socket cavity from an outer face of the side wall and the retaining recess is located on an inner face of the side wall and the diameter of the generally circular main portion of the retaining recess is larger than the diameter of the generally circular main portion of the receiving passage such that the receiving passage terminates at the retaining recess, and wherein a planar locking face is located at an end of the retaining recess proximal the receiving passage.

as claimed in any one of the previous claims, wherein the receiving passage has a generally circular main portion and the retaining recess has a generally circular main portion, wherein the generally circular main portion of the receiving passage is concentric with the generally circular main portion of the retaining recess.

5.    An excavator wear member comprising:

a body;

a side wall having a mounting ear extending rearwardly of the body;

a socket cavity extending into the body and at least partially defined by the side wall, an upper wall and a lower wall, the socket cavity being symmetrical about a horizontal plane of the excavator wear member;

a locking aperture extending through the side wall of the excavator wear member, the locking aperture having a receiving passage that has a cross sectional outline that is formed at least in part from an arcuate portion and a retaining recess that has a cross sectional outline that is formed at least in part from an arcuate portion;

wherein, the receiving passage extends inwardly toward the socket cavity from an outer face of the side wall and the retaining recess is located on an inner face of the side wall and the diameter of the arcuate portion of the retaining recess is larger than the diameter of the arcuate portion of the receiving passage such that the receiving passage terminates at the retaining recess, and wherein a planar locking face is located at an end of the retaining recess proximal the receiving passage.

4.    The excavator wear member of claim 4, wherein the generally circular main portion of the retaining recess has a larger diameter than the generally circular main portion of the receiving passage.

SECTIONS 105 and 102 OF THE PATENTS ACT

12    Section 105 of the Patents Act provides:

105    Amendments directed by court

(1)    In any relevant proceedings in relation to a patent, the court may, on the application of the patentee, by order direct the amendment of the patent, the patent request or the complete specification in the manner specified in the order.

(2)    An order may be made subject to such terms (if any) as to costs, advertisements or otherwise, as the court thinks fit.

(3)    The patentee must give notice of an application for an order to the Commissioner, who is entitled to appear and be heard, and must appear if the court directs.

(4)    A court is not to direct an amendment that is not allowable under section 102.

(5)    The patentee must file a copy of an order within the prescribed period.

(6)    On the filing of a copy of an order, the patent, patent request or complete specification is to be taken to have been amended in the manner specified in the order.

13    Section 102 provides:

102    What amendments are not allowable?

Amendment of complete specification not allowable if amended specification would claim matter not in substance disclosed in the filed specification

(1)    An amendment of a complete specification is not allowable if, as a result of the amendment, the specification would claim matter not in substance disclosed in the specification as filed.

Certain amendments of complete specification are not allowable after relevant time

(2)    An amendment of a complete specification is not allowable after the relevant time if, as a result of the amendment:

(a)    a claim of the specification would not in substance fall within the scope of the claims of the specification before amendment; or

(b)    the specification would not comply with subsection 40(2) or (3).

Meaning of relevant time

(2A)    For the purposes of subsection (2), relevant time means:

(a)    in relation to an amendment proposed to a complete specification relating to a standard patent—after the specification has been accepted; or

(b)    in relation to an amendment proposed to a complete specification relating to an innovation patent—after the Commissioner has made decisions under paragraphs 101E(a) and (aa) in respect of the patent.

Amendment of innovation patent request not allowable in certain circumstances

(2B)    An amendment to a patent request relating to an innovation patent application is not allowable if:

(a)    the patent application was provided for in section 79C; and

(b)    the effect of the proposed amendment would be to convert the application from an application for an innovation patent to an application for a standard patent.

Amendments not allowable if information not provided

(2C)    An amendment of a complete specification relating to a patent is not allowable if:

(a)    the patentee or the patentee’s predecessor in title failed to ensure the provision to the Commissioner of the information required by subsection 45(3) or section 101D in relation to the patent; and

(b)    the effect of the proposed amendment would be to remove a lawful ground of objection under paragraph 18(1)(b) or 18(1A)(b) to the specification arising from the existence of some or all of the information not provided.

(3)    This section does not apply to an amendment for the purpose of correcting a clerical error or an obvious mistake made in, or in relation to, a complete specification.

14    I make the following points concerning s 102:

    The cases establish that a liberal approach should be taken in determining whether material has been “in substance disclosed in the specification”. See Gambro Pty Ltd v Fresenius Medical Care South-East Asia Pty Ltd (1999) 48 IPR 625 at 631.

    Section 102 prohibits an amendment which results in a claim to matter not in substance disclosed in the specification. It does not prohibit an amendment to the specification, which amendment does not extend the claims.

    The words “as a result of the amendment” in ss 102(1) and 102(2) limit the extent of the prohibition in each sub-section.

15    Concerning the discretion to allow amendment, in Wimmera Industrial Minerals Pty Ltd v RGC Mineral Sands Ltd (No 3) (1997) AIPC 91–366 at 39,789 Sundberg J said:

The court has a discretion to refuse an amendment even though it is allowable under s 102. In Smith Kline & French Laboratories Ltd v Evans Medical Ltd [1989] 1 FSR 561 at 569, Aldous J said:

The discretion as to whether or not to allow amendment is a wide one and the cases illustrate some principles which are applicable to the present case. First, the onus to establish that amendment should be allowed is upon the patentee and full disclosure must be made of all relevant matters. If there is a failure to disclose all the relevant matters, amendment will be refused. Secondly, amendment will be allowed provided the amendments are permitted under the Act and no circumstances arise which would lead the court to refuse the amendment. Thirdly, it is in the public interest that amendment is sought promptly. Thus, in cases where a patentee delays for an unreasonable period before seeking amendment, it will not be allowed unless the patentee shows reasonable grounds for his delay. Such includes cases where a patentee believed that amendment was not necessary and had reasonable grounds for that belief. Fourthly, a patentee who seeks to obtain an unfair advantage from a patent, which he knows or should have known should be amended, will not be allowed to amend. Such a case is where a patentee threatens an infringer with his unamended patent after he knows or should have known of the need to amend. Fifthly, the court is concerned with the conduct of the patentee and not with the merit of the invention.

This passage was cited with approval by the Court of Appeal in Hsiung’s Patent [1992] RPC 497 at 522 and by Gummow J in Rescare Ltd v Anaesthetic Supplies Pty Ltd (Federal Court, 4 March 1993, unreported).

Grounds of Opposition

16    Simco opposes the applications on a number of broad, but overlapping grounds, namely that:

    the proposed amended claims would not, in substance, fall within the scope of the existing claims;

    the proposed amended specification would claim matter not in substance disclosed in the existing specification;

    the proposed amended claims would not be clear and succinct and would not be fairly based on the matter described in the existing specification;

    the applicant has failed to provide full and frank disclosure as to the reasons for the proposed amendments;

    the applicant has failed to provide full and frank disclosure of all matters relevant to the exercise of the Court’s discretion;

    the proposed amendments are not necessary or appropriate;

    the applicant has engaged in conduct which should disentitle it from obtaining the Court’s indulgence in allowing the proposed amendments;

    the respondent has suffered prejudice as a result of the applicant’s actions; and

    it is not in the public interest for the Court to grant leave to amend the patents in suit.

The first three grounds deal with matters arising under s 102. The balance relate to the discretion conferred by s 105.

17    In its grounds of opposition, Simco expanded upon these grounds at some length. However, in its subsequent outline, it took a more limited approach, submitting that:

    because CQMS has failed to identify the “scope” of the existing claims and the proposed amended claims, the amendments are not allowable;

    both the existing claims, and the proposed amended claims are not clear, succinct or fairly based on the specification, the “alleged inventions” in the proposed amended claims being “entirely different” from any alleged inventions defined in the original claims; and

    in the absence of any “assertion” as to the scope of the existing and proposed amended claims, it is impossible to determine whether the latter fall within the scope of the former.

18    Concerning the “scope” of the claims, Simco asserts that in these proceedings, CQMS should have propounded its view as to the proper construction of the patents so that Simco could discredit those views. In my view CQMS was obliged to explain why and how it proposed to amend each complete specification. In so doing, it may well have had to address the possible construction of an aspect or aspects of the specifications, including the existing claims, and proposed amended claims. However one can imagine situations in which there would be little or no need for construction of any aspect of the relevant specification or proposed amendments. To some extent Simco distracted itself from the real issues by its florid assertions concerning the wording of each patent. I do not deny that the drafting of some aspects of both the existing complete specifications and the proposed amendments are somewhat unsatisfactory, but I do not accept Simco’s submission that the patents or the proposed amendments are, in effect, incomprehensible or, as Messrs Ahearn Fox put it in the letter of 18 December 2012, “nonsensical”.

19    Much of the alleged difficulty which Simco attributes to the existing claims and the proposed amended claims arises from its insistence that the claims be construed with little or no reference to the body of each specification. Further, Simco seems wrongly to assume that all of the proposed amendments necessarily extend the matter claimed. Amendments reflecting material disclosed in a specification, but not previously claimed, may narrow the extent of the claims.

20    It is now well-settled that the specification must be read as a whole, keeping in mind the distinct purposes served by the body of the specification and the claims. The body of the specification frequently assists in construing the claims. See DÉcor Corporation Pty Ltd v Dart Industries Inc (1988) 13 IPR 385 at 391 citing British Thomson-Houston Co Ltd v Corona Lamp Works Ltd (1921) 39 RPC 49 at 67, 89; Monsanto Co v Commissioner of Patents (1974) 48 ALJR 59, 60. In Jupiters Ltd v Neurizon Pty Ltd (2005) 222 ALR 155 at 168 [67] the Full Court said:

(iii)    the words used in a specification are to be given the meaning which the normal person skilled in the art would attach to them, having regard to his or her own general knowledge and to what is disclosed in the body of the specification: DÉcor Corporation Pty Ltd [(1988) 13 IPR 385] at 391;

(iv)    while the claims are to be construed in the context of the specification as a whole, it is not legitimate to narrow or expand the boundaries of monopoly as fixed by the words of a claim by adding to those words glosses drawn from other parts of the specification, although terms in the claim which are unclear may be defined by reference to the body of the specification: Kimberley-Clark v Arico [(2001) 207 CLR 1, 12] at [15]; Welch Perrin & Co Pty Ltd v Worrel (1961) 106 CLR 588 at 610; Interlego AG v Toltoys Pty Ltd (1973) 130 CLR 461 at 478; [and] the body of a specification cannot be used to change a clear claim for one subject matter into a claim for another and different subject matter: Electric & Musical Industries Ltd v Lissen Ltd [1938] 4 All ER 221 at 224–5; (1938) 56 RPC 23 at 39.

21    In order to determine whether s 102 prohibits any of the proposed amendments, it is necessary that I consider their extent and effect.

Patent 452

22    The existing claim 1 is for an excavator wear assembly, including both an adaptor and a wear member. It describes the means for connecting the two components, and also prescribes that the wear member have a pair of mounting ears extending from the body. The mounting ears are to be of a prescribed size and shape. The proposed amended claim 1 adds a requirement that there be a locking aperture extending through one of the mounting ears, from an outer face to an inner face of the mounting ear.

23    Simco submits that the proposed amended specification would claim matter not in substance disclosed in the existing specification, and that the proposed amended claim would not, in substance, fall within the scope of the unamended claims. It also submits that the proposed amended claim would lack clarity, contrary to s 40(3) of the Act. In particular Simco submits that:

    there would not be a “pair” of mounting ears if one had a locking aperture and the other did not; and

    the words to be added might include a device in which both ears had locking apertures.

24    The existing specification discloses a preferred embodiment of the invention. It discloses a wear member with two mounting ears, one of which has a locking aperture. The other has a “toe aperture”. I need not go into details, but it seems that the locking aperture is to accommodate one end of a bolt-like device, the other end being accommodated by the toe aperture. Whilst the specification may disclose a preferred embodiment of the invention, that form of the invention may not exhaustively define it. Claim 1 presently claims a device with a pair of mounting ears, without any requirement that either ear have a locking aperture or a toe aperture. Thus the addition of the requirement for a locking aperture through one ear narrows the claim. It is not to the point that in proposed amended claim 1 there is no requirement for a toe aperture. Perhaps other criticisms may be made of the proposed amended claim, but the body of the existing specification discloses a wear member having a mounting ear with a locking aperture. Such a device also falls within existing claim 1. Neither s 102(1) nor s 102(2) is engaged.

25    Sections 40(2) and 40(3) provide:

40    Specifications

(1)    …

(2)    A complete specification must:

(a)    describe the invention fully, including the best method known to the applicant of performing the invention; and

(b)    where it relates to an application for a standard patent—end with a claim or claims defining the invention; and

(c)    where it relates to an application for an innovation patent—end with at least one and no more than 5 claims defining the invention.

(3)    The claim or claims must be clear and succinct and fairly based on the matter described in the specification.

(4)    …

26    As to lack of clarity, it is said that a device with locking apertures in both mounting ears might infringe the proposed amended claim 1. That may be so, but it is not relevant for present purposes. Simco also submits that it is inconsistent with the requirement that the device have a pair of mounting ears, that one ear should have a locking aperture. The submission is based upon the erroneous assumption that items comprising a “pair” must be identical. The Oxford English Dictionary (2nd ed) relevantly defines the word “pair” to mean:

1.    Two associated together; a set of two.

1.a.    Two separate things of a kind that are associated or coupled in use, usually corresponding to each other as right and left (less frequently as upper and under). Such are things worn on or adapted to the right and left limbs or sides of the body, as ‘a pair of gloves … .

Clearly, the two parts of a pair need not be identical. I see no lack of clarity in the proposed amended claim 1.

27    Finally, Simco submits that the invention claimed in the proposed amended claims is a different invention from that claimed in the existing claims. The only justification for this assertion seems to be that at some stage, CQMS claimed that the essence of its invention lay in the dimensions specified in existing claim 1, and that the proposed amendment would, in some way abandon that aspect of the invention. Obviously, the dimensions are to remain part of the proposed amended claim. I see no substance in this submission.

28    In any event, this submission seeks to substitute a more general limitation upon the capacity to amend than is prescribed by s 102. That section identifies the need for a connection between the disclosures and claims in the unamended complete specification and any proposed amendments. There is no statutory justification for the application of some further, global assessment such as that suggested by Simco.

Patent 453

29    Proposed amended claim 1 largely consolidates existing claims 1 to 5. To that extent, it cannot be asserted that as a result of the proposed amendments, the specification would claim matter not in substance disclosed in the existing specification. To that extent it also cannot be asserted that as a result of the amendment, the claim would not in substance fall within the existing claims. Proposed amended claim 1 has the following added features:

    it defines the term “excavator wear member”;

    it requires that the receiving passage extend inwardly towards the socket cavity;

    it requires that the retaining recess be located on the inner face of the side wall of the body of the wear member; and

    it adds the requirements that the locking face be “planar” and that the locking face be at the end of the retaining recess and “proximal the receiving passage”, rather than “at an inner end of the retaining recess”.

30    The proposed definition of the wear member clearly reflects the depiction of it in the existing specification. In figs 1A, 1B and 2A, the wear member is shown as having a body and a side wall, with mounting ears to the rear of the body. Figures 2B and 2C disclose a socket cavity which is at least partially defined by the side wall, an upper wall and a lower wall. According to the New Shorter Oxford English Dictionary the word “symmetrical” means:

Having the parts or elements regularly and harmoniously arranged; regular in form; correctly proportioned; well balanced … having similar or corresponding parts repeated on each side of a contained plane or around an axis … .

31    The horizontal plane is a plane passing through the wear member, parallel to the ground on which it sits. The requirement is that the socket be of such a shape that a horizontal plane will divide it into parts which can be described as being symmetrically arranged around that plane. No doubt this feature relates to the capacity of the spigot on the adaptor to dock in the socket. Whether or not a socket is symmetrically arranged around a plane is a question of fact for resolution in each case. In my view it is adequately disclosed in figs 2B and 2C.

32    Simco submits that it is not clear whether, in proposed amended claim 1, the side wall includes the mounting ear. It is not necessary that I resolve that matter at this stage. I have no doubt that when the need arises, any dispute as to the proper construction of this aspect will be capable of resolution by reference to the usual canons of construction as they apply to patents.

33    The specification at p 18 ll 5 – 9 and figs 2B and 2C disclose the receiving passage extending inwardly towards the socket cavity through a mounting ear on any wall of the wear member or tooth. Those references also disclose the retaining recess located at the inner face of the side wall.

34    As to the requirement that the locking face be “planar”, I take that term to mean “flat”. Figures 2B and 2C suggest that the locking face is flat. That surface is formed by the difference in diameter between the receiving passage and the retaining recess. It is most unlikely that the surface formed by that difference in diameter would be other than flat. In proposed amended claim 1, the locking aperture passes through the side wall, reflecting existing claim 1 rather than existing claim 2. The description of the location of the planar locking face is to be amended. In the existing claim 3, it is said to be located at an inner end of the retaining recess. In proposed amended claim 1, it is said to be located at an end of the retaining recess proximal the receiving passage. The specification, at p 18 ll 13 – 18 and figs 2B and 2C demonstrate that the locking face is formed by the difference in diameter between the receiving passage and the retaining recess. It must be located at the point at which the receiving passage enters the retaining recess. As much is demonstrated in figs 2B and 2C. The inner end of the retaining recess in existing claim 3 must be “proximal the receiving passage”. Thus there is no difference between the location of the locking face in existing claim 3 and the location specified in proposed amended claim 1.

35    Proposed amended claim 1 claims no matter not disclosed in the existing specification. Almost all of amended claim 1 is claimed in existing claims 1 to  5. To the extent that there are additional integers, they are disclosed in the existing specification. Further, they limit rather than extend the matter claimed, so that proposed amended claim 1 falls within the existing claims.

36    Proposed amended claim 2 is dependent upon proposed amended claim 1, but prescribes that at least part of the locking aperture extend through a mounting ear. I take this to mean that the aperture may be located at the point at which the mounting ear joins the body of the wear member, or at any other point on the mounting ear. Given that existing claims 1 and 2 prescribe that the locking aperture should pass through either the side wall or the mounting ear, the requirement that at least part of the aperture extend through the mounting ear clearly falls within the existing claims and the disclosures in the existing specification.

37    Proposed amended claim 3 is dependent upon any of proposed amended claims 1, 2, 4 and 5 but also requires that the planar locking face should face inwardly towards, and be open to the socket cavity. I shall return to proposed amended claim 3 after I have dealt with proposed amended claims 4 and  5.

38    Proposed amended claim 4 has many of the features of proposed amended claim 1. However it also requires that:

    the wear member be releasably mountable on an adaptor by way of spigot and socket;

    there be a mounting recess located on a side wall of the adaptor; and

    a mounting ear be adapted so that it is at least partially located within the mounting recess, when assembled.

39    The mounting of a wear member on an adaptor is clearly disclosed in the specification at p 16 l 17 to p 17 l 15. The location of mounting recesses on the adaptors is disclosed in the specification at p 16 ll 14 – 16. A mounting ear adapted to be at least partially located within a mounting recess is disclosed in the specification at p 17 ll 16 – 19. The inclusion of these additional features narrows, rather than extends the existing claims. In other words the proposed amended claim 4 falls within the existing claims.

40    Proposed amended claim 5 also has many of the features of proposed amended claim 1. However the receiving passage and the retaining recess are to have cross-sectional outlines “formed at least in part from an arcuate portion”. The word “arcuate” means “bent like a bow, curved, arched”. See the New Shorter Oxford English Dictionary. Existing claims 4 and 5 contemplate each of the receiving passage and the retaining recess having a “generally circular main portion”. Existing claim 5 contemplates the retaining recess having a greater diameter than the receiving passage. Clearly, the circular features described in existing claims 4 and 5 are the components described in proposed amended claim 5 as having cross-sectional outlines formed at least in part “from an arcuate portion”.

41    The words a “generally circular main portion” may suggest a different shape from that suggested by the words “a cross sectional outline that is formed at least in part from an arcuate portion”. The former description may suggest a shape which is substantially, but not entirely circular. The latter description may suggest an outline of which only a small part may be arcuate. On the other hand it is also arguable that in both cases, the specification offers an indication of the relevant meaning. Figures 2B and 2C suggest that both outlines are generally circular, save where they are disrupted by the slots identified in the specification at p 18 ll 10 – 14 and in figs 2B and 2C. I prefer the latter approach. In the difficult task of describing a concept which is more easily demonstrated by a diagram, the proposed amendment merely changes the emphasis.

42    Simco made no submission concerning this potential difficulty. Thus CQMS has not had an opportunity to respond to it. It may be that the problem could be solved by the evidence of the skilled addressee. Such a person might well say that he or she would understand claim 5 necessarily to require that the receiving passage and the retaining recess be substantially circular in order that the locking aperture function. I do not mean to speculate about the possible evidence of such a witness. I am rather trying to highlight the fact that CQMS has not had an opportunity to address the matter.

43    I return to proposed amended claim 3. As I have said it is dependent on any one of claims 1, 2, 4 or 5. To the extent that this proposed amended claim requires that the locking face be flat, I have already held that such requirement is disclosed in the specification and, in any event, operates to limit the ambit of the existing claims. Proposed amended claim 3 also requires that the planar locking face face inwardly towards, and be open to the socket cavity. In the specification, figs 2B and 2C disclose these features. Again, they limit, rather than extend the ambit of the claims.

44    I turn to the extent to which, as Simco submits, the proposed amendments to patent 453 would lead to the specification not complying with either s 40(2) or s 40(3). Simco submits that the proposed amended claims are not clear, succinct or fairly based on the matter described in the specification. Simco’s criticisms under this heading focus primarily on the description of the locking aperture as having two elements: a receiving passage and a retaining recess. Simco submits that this description is of a “hole within a hole”. Such criticism is little more than a rhetorical flourish. The concept is demonstrated in the specification in figs 2A, 2B and 2C and at p 18 ll 3 – 18. Fairly clearly, the two parts of the locking aperture are designed to hold the parts of the lock assembly (numbered 1330 and 1340 in fig 3A). As appears from figs 2A, 2B and 2C the receiving passage passes from the outer surface to a point where it enters a chamber having a larger diameter. This is the retaining recess. As outlined in proposed amended claim 1, the locking aperture, as a whole, passes through the full thickness of the side wall, but it is in two parts, the narrower receiving passage and the wider retaining recess. As I have previously pointed out the difference in diameter between the receiving passage and the retaining recess creates the locking face.

45    To the extent that Simco advances any other particulars of non-compliance with s 40(2) or s 40(3), I have dealt with them in my discussion of the issues raised in connection with s 102(1) and s 102(2) or I have indicated that the issues are suitable for resolution by way of construction, should that be necessary in the future. It follows that I find no failure to comply with s 40(2) and s 40(3)

46    Simco makes a further general submission that the invention claimed in the proposed amended claims is different from that claimed in the existing claims. At para 19 of its particulars of grounds of opposition, Simco asserts:

The alleged invention defined by the claims of the 453 Patent, as a result of the Proposed Amendments, must be different from the invention (if any) defined by the claims as granted and certified in that:

(a)    The Invalid Claims claim an excavator wear member comprising a locking aperture;

(b)    The Proposed Amendments seek to introduce a number of solid integers (including a body);

(c)    The Proposed Amendments appear to define the “mounting ear” as part of the “side wall” and the body as excluding the side walls whereas previously those integers were either not defined or defined as separate integers;

(d)    The Invalid Claims do not include a wear member that is releasably mountable on an adaptor.

47    As to ground (a), the proposed amended claim 1 will also claim a wear member comprising (among other things) a locking aperture. Ground (b) seems to assume that the device as described in the existing claims has no body. The criticism makes no sense and ignores the content of the specification. As to ground (c), I have recognized the possibility of a dispute as to whether the mounting ear is part of the side wall or a separate component, although effectively an extension of the side wall. I do not consider that it is presently necessary that I resolve that question. I see no reason for concluding that it will be impossible to resolve any such dispute as a matter of construction. As to ground (d) it is true that existing claims 1 to 5 do not require that the wear member be releasably mountable on an adaptor. However that matter is disclosed in the specification at p 10 l 21 to p 11 l 17. The inclusion of a socket cavity in proposed amended claim 1 narrows the overall totality of the matter claimed in the existing claims. Proposed amended claim 4 includes the requirement that any wear member be releasably mountable on an adaptor having a spigot. I have explained my reasons for concluding that it does not claim more than is claimed in the existing claims. I again point out that Simco attempts to impose a further, global test for the permissibility of amendments. Such approach has no statutory authority.

48    It follows that s 102 does not prohibit any of the proposed amendments.

The Discretion to Amend

49    Section 102 proscribes amendment in certain circumstances. Where that section is not engaged, the Court has a discretion to order amendment pursuant to s 105. Although s 105 offers no real guide to the consideration which may be relevant to the exercise of the discretion, the cases establish some general propositions. In Les Laboratoires Servier v Apotex Pty Ltd (2010) 273 ALR 630 at 646 [76], Kenny and Stone JJ cited with approval the passage from the decision of Aldous J in Smith Kline & French Laboratories Ltd v Evans Medical Ltd to which I have referred above.

50    In Apotex at [57] – [59], Emmett J gave a more exhaustive exposition of the principles as follows:

[57]    It is against the public interest for invalid claims in a patent to be maintained. Where a patentee seeks to maintain an invalid claim, in circumstances where the patentee knows or ought to know that the claim is invalid, the patent system is abused. Failure to amend on the basis of invalidity arising from lack of novelty, even after the patentee becomes aware of that invalidity, is relevant to the exercise of the discretion to permit amendment when subsequently applied for. On the other hand, if the patentee did not know nor ought to have known of the relevance of prior art and did not attempt to obtain some unfair advantage, a delay in seeking amendment will not bar the exercise of the discretion, so long as there is no unreasonable delay after the prior art comes to the attention of the patentee.

[58]    If a patentee knows of prior art fatal to the patent and deliberately refuses to apply to amend over a long period, notwithstanding that the patentee knows that the claims must be invalid as they stand, amendment should be refused on the basis that the patentee has knowingly represented to the public that there is a valid claim that the patentee knows cannot be supported. It is in the public interest that patentees should not delay in seeking to amend to avoid invalidity. Amendment will not be permitted in cases where a patentee knows that amendments should be sought but fails to make an application for amendment for a substantial period of time. Of course, it is different where a patentee knows of prior art that the patentee genuinely, and quite properly in the circumstances, thinks is irrelevant. That situation is to be contrasted with the situation where the patentee learns of, or has been warned of, objections that are available against the patent as a result of prior art, yet takes no steps or knowingly persists in retaining the patent in the unamended form: see Smith Kline & French Laboratories Ltd v Evans Medical Ltd [1989] 1 Fleet Street Reports 561 at 566–8. Further, where an application for a direction to amend under s 105 is made, the onus is on the patentee to make full disclosure of all relevant matters to enable the court to be satisfied, in the public interest, that an amendment is properly allowable: see Hsiung’s Patent [1992] RPC 497 at 512.

[59]    The underlying purpose of the power conferred by s 105 is to allow a patentee to validate what would otherwise be an invalid or partially invalid patent. It is a power conferred on the court for the benefit of the patentee. However, the exercise of power in favour of the patentee is an indulgence. The rationale underlying the court’s discretion to refuse permission to amend is that it is the duty of the court to protect the public from abuse of the monopoly conferred by the grant of a patent. Where a patentee has claimed a monopoly over an area that is unjustifiably wide, research and experiment that might otherwise have been carried out might be deterred. That is against the public interest. On the other hand, where there has been no abuse of the monopoly, there would be no reason to refuse an amendment in order to protect a patentable invention that would otherwise be unprotected. It is in that context that the conduct of a patentee is relevant. If a patentee persists in defending or asserting claims that the patentee knows are unjustifiably wide, the implication is that the patentee is claiming to own something that really belongs to the public. By delaying too long in seeking to amend, the patentee may have effectively persisted in maintaining claims that the patentee knows are unjustifiably wide: see Vector Corp v Glatt Air Techniques Ltd [2007] RPC 255 at 279–80.

See also Bayer Pharma Aktiengesellschaft v Generic Health Pty Ltd (2012) 99 IPR 59 at 87 - 8 [162] – [164] per Yates J.

51    CQMS submits that there are no matters which might cause me to decline to make the orders sought. Simco submits that for a number of reasons I should decline to make those orders. Simco’s grounds of opposition, as argued may be grouped under five headings as follows:

    failure to provide full and frank disclosure as to reasons for the proposed amendments;

    failure to provide full and frank disclosure of all matters relevant to the Court’s discretion;

    the proposed amendments are not necessary or appropriate;

    the applicant has engaged in conduct such that leave should be refused; and

    prejudice and public interest.

The Evidence

52    Before considering the exercise of the discretion, I should set out relevant aspects of the evidence. None of the deponents was cross-examined. The witnesses were Mr Luxton, CQMS’s patent attorney, Mr Coogan, CQMS’s solicitor, Mr Anderson, Simco’s patent attorney, and Mr Fox, Simco’s solicitor. Mr Luxton’s evidence was extensive. Later, I shall refer to it in some detail.

53    Mr Coogan’s evidence is largely formal. Apart from exhibiting documents, he deals with two matters. The first is the history of these proceedings from 6 February 2013 until the hearing on 3 February 2014. The second concerns a statement by Mr Luxton that the Patent Office had received the proposed amendments and was prima facie satisfied that they met the requirements of s 102. Mr Anderson sought to obtain any documents held by the Patent Office, which documents dealt with the proposed amendments. He was told that there were no such documents, and that the statement by the Patent Office, that it was prima facie satisfied as to compliance with s 102, was a “standard letter”. Mr Anderson inferred that the Patent Office “had [not] reviewed the applications for amendment nor the proposed amendments …”. Mr Coogan responded, setting out information from the Patent Office which indicated that it had reviewed the proposed amendments, and that it considered that prima facie, they satisfied the requirements of s 102. As far as I can see, the matter is of no important in this case. Mr Anderson also exhibits a number of documents. Mr Fox exhibits correspondence between his firm and CQMS’s lawyers, which documents had not been exhibited by Mr Coogan.

54    Mr Luxton swore two affidavits. In the second affidavit, he exhibited a copy of a patent not directly relevant to the case, patent 2013100565 (“patent 565”). An associated patent, patent 2013100566 (“patent 566”), is exhibited to the affidavit of Mr Anderson. Concerning these patents, Mr Luxton also provided information of a formal nature. His first affidavit is of primary importance in this case. In it he:

    identifies the relevant patent applications;

    describes the procedural history of patent applications 452 and 453;

    exhibits CQMS’s letter of demand and Simco’s reply;

    describes his process of reasoning concerning the validity of patents 452 and 453; and

    sets out the procedural history of the applications for amendment.

The patent applications and procedural history

55    Before dealing with evidence concerning the patent applications and patents, I should say something about the Patents Cooperation Treaty, done at Washington, 19 June 1970 (the “Treaty”). The Treaty was adopted in Australia by the Patents Amendment (Patents Cooperation Treaty) Act 1979 (Cth) (the “PCT Act”). The Treaty provides for the establishment of the International Searching Authority and the International Preliminary Examining Authority for international searches and international preliminary examinations respectively. The objective of an international search is to discover relevant prior art. The objective of an international preliminary examination is to formulate a preliminary and non-binding opinion as to whether a claimed invention appears to be novel, to involve an inventive step (to be non-obvious) and to be industrially applicable. See the Treaty at Arts 15, 16, 32, and 33, the PCT International and Preliminary Examination Guidelines (PCT/GL/ISPE/2) as in force 1 November 2011, as amended 1 July 2012 (PCT)/GL/ISPE/2ADD), and now further amended as in force since 1 July 2014 (PCT/GL/ISPE/3). Pursuant to s 88 of the Patents Act, a PCT application is to be treated, for the purposes of that Act, as a complete application for a standard patent. Mr Luxton claims to have acted on the basis of the preliminary search reports and the preliminary examinations. There is no suggestion that in so doing, he departed from any relevant standard of professional conduct or competence.

56    On 11 December 2009, CQMS filed provisional patent application 2009906064. On 13 December 2010, pursuant to the Treaty, CQMS filed patent application PCT/AU2010/001682 (the “1682 PCT application”). Patent application 2010330705 (the “705 application”) is a standard patent application. Its entry date was 6 March 2012. Mr Luxton describes it as the “national phase application” of the 1682 PCT application.

57    On 1 February 2011, the International Searching Authority issued a report concerning the 1682 PCT application. The report identified three pieces of prior art of which one led to the conclusion that claims 1 to 26 were not novel. On 14 July 2011 CQMS applied for international preliminary examination of the 1682 PCT application. On 5 August 2011, it provided replacement pages and submissions, effectively amending the application in order to remedy the want of novelty identified in the search report. On 8 September 2011, the International Preliminary Examining Authority issued a preliminary examination report. It concluded that in light of the amendments, the novelty objections had been overcome. However three other pieces of prior art were cited as demonstrating that all 27 claims lacked an inventive step. Further amendments were made and, on 10 January 2012, a further report was issued, again indicating that all of the claims were novel, but that no inventive step was demonstrated. On 19 April 2012 CQMS filed divisional patent application 2012/100452, the application being for an innovation patent derived from the 705 application. It also requested certification. Patent 452 was granted on 3 May 2012. Mr Luxton said that prior to 10 April 2013, he had no concerns about the validity of the application. In particular, he had no reason to doubt novelty. As the application was for an innovation patent, it was necessary to show an innovative step (about which matter he had no concern), and not an inventive step. Until 10 April 2013, he continued to hold that view. Patent 452 was certified on 29 May 2012.

58    A similar process was followed concerning patent 453. On 19 November 2010, CQMS filed, pursuant to the Treaty, patent application PCT/AU2010/001556 (the “1556 PCT application”). The search report indicated that claims 1 to 24 were novel but that claims 14 to 20 lacked an inventive step. Patent application 2010330673 (the “673 application”) is a standard patent application. Mr Luxton described it as the “national phase application” of the 1556 PCT application. It was entered on 6 March 2012. Patent 453 is an innovation patent derived from the 673 application. The 453 application was filed on 19 April 2012. Patent 453 was granted on 3 May 2012. On 24 May 2012, the Patent Office issued a report which indicated that two of the claims were not clear. On 1 June 2012, CQMS provided amendments. Patent 453 was certified on 7 June 2012. At the time of filing and prior to 10 April 2013, Mr Luxton had no concern that the application was invalid, either for want of novelty or for lack of an innovative step.

The letter of demand and Simco’s response

59    On 11 December 2012, Mr Luxton wrote to Simco, asserting that it had infringed patents 452 and 453. He sought undertakings that Simco “forthwith cease and further desist from importing, manufacturing, selling, offering to sell, hiring, disposing of, using for the purpose of trade or commerce, or otherwise exploiting” the allegedly infringing device, together with other undertakings. Mr Luxton indicated that in the event of failure to provide the undertakings or breach thereof, CQMS “may commence legal proceeding against [Simco] …”. He also invited Simco to treat the letter as constituting genuine steps taken by CQMS to resolve the dispute prior to the commencement of proceedings.

60    On 18 December 2012 Messrs Ahearn Fox, Patent and Trademark Attorneys, responded on behalf of Simco concerning patent 452:

    alleging that Mr Luxton had made baseless threats;

    alleging that patent 452 was “clearly of indeterminate scope”, presumably an assertion of invalidity;

    denying infringement; and

    alleging anticipation by “a number of the admitted prior art documents”, apparently those referred to in the patent 452 specification.

61    Concerning patent 453 Messrs Ahearn Fox:

    described claim 1 as “nonsensical”;

    claimed that the appended claims were therefore also “nonsensical”;

    asserted that the disclosed prior art documents anticipated the invention;

    claimed that there was no basis for infringement proceedings;

    asserted that no proper investigation had been carried out in relation to the patent before the threats were made;

    asserted that Mr Luxton and his client “would have been aware, at the time you sent your letter, that the claims of both [patent 452] and [patent 453] were anticipated by the admitted prior art”;

    referred to the international search reports for the respective PCT applications; and

    concluded:

Consequently, our client’s view that your client has embarked on a program of heavy handed trade practices with the intention of causing damage (with its attorney’s assistance) seems to be well founded. Again, we ask that you and your client cease and desist from making groundless threats. In view of the fact that none of the threats which have been made so far have had any basis, it seems that the appropriate course is for you and your client to assume that our client does not and will not infringe any rights which your client may have, rather than continue making groundless threats.

62    These proceedings were commenced on 21 December 2012. On 4, 5 and 6 February 2013 the solicitors for Simco wrote several letters to the solicitors for CQMS. I shall not refer to the letters in detail. However they:

    confirmed that Simco believed patents 452 and 453 to be invalid “for a number of reasons, which will be pleaded in due course”;

    denied infringement;

    spelled out in some detail Simco’s views concerning infringement;

    asserted that patent 452 was not novel; and

    cited no relevant items of prior art.

63    In the letters Simco also asserted, concerning patent 453, that:

    it lacked novelty, a number of items of prior art being cited;

    the claims were not clear and succinct and not fairly based on the specification;

    the invention lacked novelty;

    the patent did not involve an innovative step;

    the claims were not capable of construction; and

    in any event the prior art documents referred to in the specification established that claims 1 and 3 to 5 did not define an invention which was novel.

64    A statement of claim was filed with the application. On 22 March 2013 the defence, notice of cross-claim, statement of cross-claim and particulars of invalidity were delivered. In those documents Simco alleged that patents 452 and 453 were invalid on various grounds, including for want of novelty. Reference was made to various items of prior art.

The decision to amend

65    After receipt of the particulars of invalidity on 22 March 2013, Mr Luxton considered the validity of patents 452 and 453 in light of the prior art cited by Simco. By 10 April 2013 he had formed the view that patent 452 was entitled to priority only from 13 December 2010. This conclusion did not have any bearing on the validity of the patent. However Mr Luxton considered that in light of one item of prior art cited by Simco, claims 1 to 3 of patent 452 were not novel. The item in question is described as WO2002/101160. Although that item had previously been raised in connection with inventiveness, it had not been cited as going to novelty.

66    Mr Luxton also considered that in light of nine items of prior art cited by Simco concerning the 453 patent, all of the claims of that patent lacked novelty. Of those nine items, five had not previously come to Mr Luxton’s attention. The other four had come to his attention, but only in respect of inventiveness. I should point out that in a letter from Simco’s solicitors to CQMS’s solicitors dated 5 February 2013, one of the nine items, US6467203, was cited as going to the novelty of patent 453. There is no evidence that the letter was forwarded to Mr Luxton. In some circumstances one would have expected the solicitors to have done so. However, as service of the defence, cross-claim and particulars of invalidity was imminent, it was reasonable to await service of those documents. Further, in the letter of 5 February 2013 Simco’s solicitors had expressly stated that the citation of the identified items of prior art was not intended to limit Simco’s “position” in any way. Thus it was not a final list. Having considered the cited prior art and reached these conclusions, Mr Luxton decided that CQMS should seek to amend the patents.

67    According to Mr Coogan, between 16 May and 15 July 2013, the parties negotiated on a “without prejudice” basis. They failed to reach agreement. At that point CQMS instructed Mr Luxton to apply to amend the patents. At a directions hearing on 29 July 2013 counsel informed me that CQMS intended so to apply. I ordered that the parties file agreed directions as to the future conduct of the application for amendment. The parties could not agree. On 30 August 2013 the applications to amend were filed in the Patent Office.

68    On 30 August 2013 the solicitors for CQMS wrote to the solicitors for Simco, asserting that Simco had not complied with its obligations to take genuine steps to resolve the dispute before the commencement of civil proceedings. In particular, they suggested that it had not, prior to 5 February 2013, provided details of relevant prior art going to the issue of novelty. The solicitors asserted that it was not until 22 March 2013 (when the defence and associated documents were filed) that Simco had fully identified the relevant prior art for both patents. The solicitors suggested that this conduct had led to the incurrence of additional costs, particularly in connection with CQMS’s application for leave to amend.

69    On 2 September 2013 I ordered that the application for amendment be heard on 3 February 2014.

70    On 26 September 2013 notice of intention to amend patent 452 was advertised. On 19 September 2013, the proposed amendments to patent 453 were, themselves, amended. On 10 October 2013 notice of intention to amend was advertised.

Exercise of the discretion

71    Simco submits that CQMS has failed to make full and frank disclosure. In particular, it submits that CQMS has disclosed no documents evidencing advice sought or obtained in connection with Simco’s allegations of want of novelty. Simco further submits that CQMS has failed to disclose the true reasons for the proposed amendments. These submissions are based upon the proposition that CQMS must have, or should have obtained advice concerning novelty prior to sending the letter of 11 December 2012 and/or thereafter in response to Simco’s assertions of invalidity. Mr Fox, appearing for Simco, did not identify the nature of the advice which should have been sought, or the sources from which it should have been sought. One assumes that Mr Fox had in mind legal and/or patent advice.

72    Mr Luxton, CQMS’s patent attorney, wrote the letter of 11 December 2012. His firm had been involved in the matter, at least since the filing of the provisional specification. Mr Luxton had been personally involved, at least since 5 August 2011, and probably from a much earlier date. Mr Coogan is CQMS’s solicitor. He signed the originating application in these proceedings. Thus he has been concerned in the matter since at least December 2012 and probably from an earlier date. Both men have sworn affidavits. They were not cross-examined. Clearly, CQMS was looking to Mr Coogan for legal advice and to Mr Luxton for patent advice. It seems certain that any decision to seek other types of advice would have come from either or both of them. One might reasonably have expected Mr Fox to have cross-examined them about whether they had or should have given advice and/or advised the obtaining of advice from other sources. In any event, it was Mr Luxton’s thought processes which were relevant. They were disclosed in his first affidavit and not challenged in cross-examination. There is nothing in this point. As to the true reasons for the proposed amendments, I see no reason for inferring that CQMS had any ulterior purpose in seeking them. Mr Fox did not attempt to identify any such purpose.

73    Simco submits that CQMS failed to put in evidence patents 565 and 566. These patents seem to cover much the same ground as patents 452 and 453, incorporating the proposed amendments. The only suggested relevance is that the applications for, and grants of patents 565 and 566 demonstrate an alternative approach which CQMS could have taken in order to protect its position, instead of applying to amend. However Simco pointed to no principled basis for the suggestion that CQMS had to choose one course or the other, or that the only proper course was to apply for new innovation patents. Alternatively, Simco submits that the applications for, and receipt of grants of patents 565 and 566 comprised disentitling conduct for the purposes of the applications to amend. In the end, the submission seemed to be that had CQMS simply applied for the new innovation patents, it would have saved court time and expense to Simco. However CQMS clearly sees a benefit in amending patents 452 and 453. The applications for, and grants of patents 565 and 566 have not led to any further expenditure of the Court’s time or of Simco’s money. In those circumstances, I cannot see that CQMS’s conduct, in seeking and obtaining patents 565 and 566, is relevant to the exercise of the discretion.

74    Hence I see no material non-disclosure.

75    Simco submits that CQMS delayed in seeking to amend, and that such delay militates against granting the application. It submits that its letter of 18 December 2012 should have led CQMS to consider the validity of the patents. This submission must be assessed in light of Mr Luxton’s reliance on the international search reports and the international preliminary examinations. Mr Fox’s letter of 18 December 2012 referred collectively to the “large number of prior art documents” referred to in the patent 452 specification, without identifying the relevant items. It also referred to a “brief perusal” of those documents. It would be unreasonable to expect CQMS to have acted upon such a general allegation, based upon limited reference to unidentified material. Mr Fox made similar comments about patent 453. Similar comments apply. Mr Fox’s dismissive criticisms of the claims in both patents were hardly likely to encourage the belief that Simco’s attack on the validity of the patents was well-founded.

76    With regard to patent 453 it was not until 5 February 2013 that Simco made any attempt to identify items of prior art said to demonstrate lack of novelty. Even then, Simco reserved its right to rely on other items of prior art. On 5 February 2013 I ordered that Simco deliver its pleadings on 13 March 2013. The date was later changed to 22 March 2013. Numerous further items of prior art were identified in the particulars provided on that date. In my view it was reasonable for CQMS to defer any consideration of Simco’s position until receipt of the relevant pleadings, with a definitive list of relevant prior art items. The alternative was to consider the case with respect to patent 453, alone, on the basis of a preliminary list of allegedly relevant prior art, a task which might have had to be repeated or supplemented when the pleadings were served.

77    Clearly, enough, after receipt of the pleadings, some time was inevitably consumed in instructing Mr Luxton and in his consideration of the matter. I see no sensible basis for criticizing his taking until 10 April 2013 to form a concluded view as to the effect of the prior art on the question of novelty, particularly, given the number of items of prior art which were cited. Even at that stage, Simco was asserting the possibility that it might rely on other items.

78    During the period from 16 May 2013 to 15 July 2013 the parties were in negotiations. The courts encourage the resolution of disputes by negotiation. It would be inconsistent with such policy if I were to treat the period of negotiation as a consideration militating against ordering amendment. I also do not see that the period from 10 April 2013 to 16 May 2013 was an unreasonable period in which to consider Mr Luxton’s changed position and to identify how the matter should proceed on the basis of that changed advice. I also do not accept that is was unreasonable, following the collapse of negotiations, for CQMS to have taken a little less than seven weeks to decide to seek amendment of the patents and to prepare and file the necessary documents. In summary, I do not consider that there has been any delay which should militate against ordering amendment.

79    More generally Simco seems to submit that CQMS should have responded differently to its assertions of invalidity. In particular Simco submits that the question of novelty should have been investigated simply because Simco had raised it. Further CQMS should have done so before Simco had provided references to relevant prior art. This submission overlooks Mr Luxton’s reliance on the search report and preliminary examination. Simco also seems to submit that I should examine the unamended patents and the proposed amendments with a view to determining the validity of its criticisms of both patents, and to assess the effectiveness or otherwise of the proposed amendments in correcting any problems with novelty. Such a task would take some time and would require further submissions. Mr Fox suggests that I might like to perform the task on a “preliminary” basis. As to efficacy of the proposed amendments I accept that if it were clear that they would not resolve any problem with novelty, it would be pointless to allow them. However that is not the present case. I also do not consider that I should assess the validity of the somewhat aggressive allegations made by those representing Simco. I see nothing in these submissions which would militate against allowing the proposed amendments.

80    In the circumstances, I propose to make the following orders:

1.    the complete specification of Australian Patent No. 2012100452 be amended in the terms specified in annexure AL-31 to the affidavit of Adam Luxton filed on 18 October 2013;

2.    the complete specification of Australia Patent No. 2012100453 be amended in the terms specified in annexure AL-35 to that affidavit.

81    I shall hear submissions as to costs.

Associate:

Dated:    23 December 2014