FEDERAL COURT OF AUSTRALIA

PATENTS - Notice of motion - application for stay of adjournment of proceedings until determination of related patent application - hypothetical assumption that standard patent will be granted - whether real prejudice to respondent if application granted.

COURTS AND JUDICIAL SYSTEM - general principle that legitimate claim be determined by Court as expeditiously as possible - whether hypothetical patents case can be heard simultaneously with related matter - case management system.

No: VG267 of 1994

F A FAULDING & CO LIMITED v BRISTOL-MYERS SQUIBB COMPANY

No: VG109 of 1995

BRISTOL-MYERS SQUIBB COMPANY v F A FAULDING & CO LIMITED

HEEREY J

MELBOURNE

8 OCTOBER 1997

THE COURT ORDERS THAT:

            1.         The Notice of Motion dated 7 August 1997 is dismissed.

            2.         F A Faulding & Co Limited pay  Bristol-Myers’ Squibb Company                                  costs of the Notice of Motion in both matters.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

A Notice of Motion dated 7 August 1997 has been brought in two associated matters which both concern two petty patents granted to Bristol-Myers Squibb Company (BMS).  The petty patents concern a method for administering to patients an anti-cancer agent known as Taxol. 

In VG267 of 1994, commenced on 17 August 1994, F A Faulding and Company Limited (Faulding) seeks revocation of the petty patents.  In VG109 of 1995, commenced on 17 February 1995, BMS seeks injunctions and other relief for alleged infringement of the petty patents  by Faulding.  There is currently under consideration in the Patent Office an application by BMS for a standard patent in respect of substantially the same invention.  There was an earlier application which lapsed.  The present one is a divisional application, number 42070/96.  It was filed on 18 January 1996. 

What Faulding seeks on the present Notice of Motion is essentially an order that the present proceedings be stayed or in the alternative, be adjourned until the pending standard patent application is granted or refused.  It is said in support of that application that there would be undesirable multiplicity of proceedings if the present litigation were to proceed to trial, and there was subsequent litigation resulting in the agitation of similar issues in relation to the standard patent.

There are a number of detailed practical problems with the orders sought, but I should say at the outset that they do not stand on the same level of importance as the primary principle advanced by Dr Emmerson QC on behalf of BMS. 

That principle is that someone who brings a legitimate, genuinely arguable claim to the Court is entitled to have that claim heard as soon as the Court can conveniently arrange it, consistently with the demands of other litigants.  The present case is ready for trial and subject to final discussions as to the availability of witnesses, will probably be heard in June next year.  It is estimated to last some 10 to 15 days.  What is being sought is an indefinite postponement of the trial to await hypothetical litigation, which may or may not be brought, in relation to a hypothetical standard patent, which may or may not be granted. 

Moving to matters of more detail, it is said by counsel for Faulding that the standard patent process would result in acceptance by the end of the year.  It is said that the period for opposition would expire by the end of March 1998 - quite probably without any opposition, because Faulding will not oppose - and that there will be a sealing of the patent in April 1998.  As was pointed out in argument, that involves some substantial assumptions.  It assumes that the Commissioner will in fact accept the patent.  If the Commissioner were to refuse to grant, there would be a right of appeal to this Court, a right which doubtless would be exercised by BMS.  This would be a separate proceeding, not involving Faulding.  Also there is the assumption that there will be no opposition.

The most that can be said on the material available is that the estimate of a sealing of the patent by April next year is one that assumes that a number of important imponderables will fall in favour of the applicant for the grant.

Moreover, it cannot be assumed that if and when the standard patent is granted, the present cases can be taken off the shelf, as it were, and given a prompt trial together with the standard patent case.  The latter case would have to run through the usual interlocutory procedures which, if the present cases are any guide, could be quite substantial.  There would also be the demands of other cases in the docket.  Cases in the docket at the moment are being fixed for trial up to eight months or more ahead.  It would not be fair or feasible to unfix those cases to provide two to three weeks for the present cases and the hypothetical standard patent case.

The main ground relied on as to inconvenience necessarily assumes that issue estoppel or Anshun estoppel will not apply and that the Court and the parties will be engaged in the trouble and expense of litigating the same or very similar issues.  I think all I can say on that at the moment is that I am not prepared to accept that this would necessarily be so or that a Court today would not be astute to avoid wasteful procedures. 

The prejudice said to be suffered by Faulding if the matters proceed as presently planned, without waiting for the litigation over the standard patent, is that there will be uncertainty which will impinge on Faulding's capacity to make commercial decisions relating to the marketing of its product.  However, that uncertainty is going to exist in any event while Faulding awaits the outcome of the application for the standard patent by BMS.

Finally, there would be real prejudice to BMS if the application were granted.  The period of the petty patents expires on 29 January 1999.  The opportunity to gain during that period a permanent injunction against Faulding is a matter of great commercial value to BMS and obviously the reason it has pursued this litigation in the first place.  There have already been three years out of the six year term of the petty patents taken up with interlocutory steps, and if the course advocated by Faulding is adopted BMS may well lose its opportunity to enjoy protection of the petty patents in the marketplace (assuming of course it is successful in the present litigation), and the head start advantage that would give.

So for those reasons the application is dismissed. 

I  order that in both matters Faulding pay Bristol-Myers' costs of the Notice of Motion. 

I certify that this and the preceding

three (3) pages are a true copy of the

Reasons for Judgment of his Honour

Justice Heerey.

Associate:

Dated: 8 October 1997

Counsel for the Applicant:                     R C Macaw QC and B Hess

Solicitors for the Applicant:                   Freehill Hollingdale & Page

Counsel for the Respondent:                 Dr J McL Emmerson QC with B W Caire

Solicitors for the Respondent:                Minter Ellison

Date of Judgment:                                 8 October 1997

Date of Hearing:                                   8 October 1997