FEDERAL COURT OF AUSTRALIA

Cadbury Schweppes Plc v Effem Foods Pty Ltd [2006] FCA 1267

PATENTS – appeal under s 60(4) of Patents Act 1990 (Cth) by applicant for patent against decision of Commissioner of Patents upholding opposition to grant – pursuant to leave, opponent withdrew its appearance on the appeal, did not appear on the hearing of the appeal, and submitted no evidence in support of the Commissioner’s decision – Commissioner, joined as second respondent, appeared on hearing of appeal, but only to announce that she did not wish to participate actively on the hearing of the appeal or to oppose the allowing of the appeal – procedure to be followed on the hearing of the appeal – Held: appeal could be allowed without applicant’s adducing evidence to displace the opposition that had succeeded before the Commissioner

Patents Act 1990 (Cth) s 60(4)

F Hoffman-La Roche AG v New England Biolabs Inc (2000) 99 FCR 56 cited

Caroma Sales Pty Ltd v Philmac Pty Ltd (1972) 46 ALJR 324 cited

Brickwood Holdings Pty Ltd v ACI Operations Pty Ltd [1983] 2 VR 587 cited

Titan Mining & Engineering Pty Ltd v Arnall’s Engineering Pty Ltd (1988)

12 NSWLR 73 cited

European Community v Commissioner of Patents [2006] FCA 706 followed

CADBURY SCHWEPPES PLC v

EFFEM FOODS PTY LTD (ACN 008 454 313) & ANOR

NSD 1108 OF 2002

LINDGREN J

22 SEPTEMBER 2006

SYDNEY

ON APPEAL FROM THE COMMISSIONER OF PATENTS

THE COURT ORDERS THAT:

1.                  The Commissioner of Patents be joined as second respondent to the appeal.

2.                  The appeal be allowed.

3.                  The decision of the Delegate of the Commissioner of Patents given on 30 September 2002 allowing the opposition be reversed.

4.                  The opposition to Australian Patent Application number 706901 filed by the Respondent in the Australian Patent Office on 1 October 1999 be dismissed in its entirety, and the said patent application proceed to grant.

5.                  The applicant serve a sealed copy of these Orders upon the Commissioner of Patents within seven (7) days.

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

ON APPEAL FROM THE COMMISSIONER OF PATENTS

REASONS FOR JUDGMENT

1                                             The following are my reasons for the orders made on 28 August 2006.

2                                             The applicant (“Cadbury”) appeals to the Court under s 60(4) of the Patents Act 1990 (Cth) (“the Act”) against a decision of a delegate of the second respondent (“the Delegate” and “the Commissioner” respectively) given on 30 September 2002 concerning an Australian Patent Application Number 706901 (“the Patent”). By the decision, the Commissioner, by the Delegate, allowed the opposition of the respondent (“Effem”) to the grant of the Patent, and awarded costs against Cadbury.

3                                             The Patent application was filed under the Patent Cooperation Treaty on 21 December 1995 under International Application Number PCT/GB95/03010. The application claimed priority from British Application 9426078 dated 23 December 1994. The publication date was 19 July 1996 and the publication journal date was 5 September 1996. The application and complete specification were accepted on 6 May 1999. Notice of the acceptance was advertised on 1 July 1999 under serial number 706901. Effem’s notice of opposition was filed on 1 October 1999. On the appeal, I had before me Effem’s “statement of grounds and particulars of opposition” dated 4 January 2000. The opposition was heard on 19 February 2002.

4                                             The specification related to a “process for manufacture of reduced fat chocolate”. There are ten claims. The process involves controlling the milling of the solid ingredients to produce particles of a specific “particle size distribution,” in which the proportion of ultrafines is kept to such a level that the addition of water is not required.

5                                             Effem’s grounds of opposition were:

1. lack of novelty;

2. obviousness;

3. not a method of manufacture;

4. non-compliance with s 40 of the Act.

Before the Delegate, the opposition succeeded on obviousness alone.

6                                             The closest art relied on by Effem was a PhD thesis entitled “Particle Size Distribution Effects in Chocolate Processing” by A D Darley, University of Bradford, 1987. This document was referred to as “D10” in the Delegate’s decision.

7                                             Cadbury challenged the admissibility of D10 before the Delegate on the ground that Effem had not provided an exact publication date. However, the Delegate noted that the first page of D10 indicated that it was submitted in February 1987. The Delegate stated, “A PhD thesis, once submitted, is published by the university within a few months at worst”. In addition, the Delegate noted that the cover sheet from the British Library Document Supply Centre carried a handwritten date of 1987. According to the Delegate, this suggested that the thesis was publicly available well before the priority date of Cadbury’s application.

8                                             The Delegate found that, on the balance of probabilities, D10 was published before the earliest priority date of the claims. On this basis the Delegate concluded that all ten claims were obvious and that there was no patentable subject matter. For this reason, dependent on D10 alone, the Delegate refused Cadbury’s application for the Patent.

9                                             On 7 August 2006, pursuant to O 22 r 1 of the Federal Court Rules, I granted Effem leave to withdraw its appearance. On 14 August 2006, Effem filed a notice of withdrawal of appearance.

10                                          The Commissioner appeared on the hearing of the appeal, but did not wish to be heard in opposition to the appeal. With her consent, I ordered that she be added as second respondent.

11                                          In the light of the above developments, no evidence was adduced on the hearing of the appeal in support of any ground of opposition.

12                                          An appeal under s 60(4) of the Act is a proceeding in the original jurisdiction of the Court, and is in the nature of a hearing de novo. None of the evidence in support of the opposition that was before the Delegate was before the Court.

13                                          Cadbury submitted that the onus rested on Effem to establish that, if granted, the Patent would be clearly invalid: F Hoffman-La Roche AG v New England Biolabs Inc (2000) 99 FCR 56 at [48]-[67].

14                                          Cadbury further submitted that in the circumstances, it was not required to adduce any evidence to counter the ground of opposition that succeeded before the Delegate or any other ground of opposition.

15                                          Recently, in European Community v Commissioner of Patents [2006] FCA 706, Young J dealt with a similar submission made in similar forensic circumstances. Young J accepted the submission and held that the appeal should be allowed and that the application for the patent should proceed to grant. His Honour referred to Caroma Sales Pty Ltd v Philmac Pty Ltd (1972) 46 ALJR 324 per Walsh J; Brickwood Holdings Pty Ltd v ACI Operations Pty Ltd [1983] 2 VR 587 at 588-589 per King J; and Titan Mining & Engineering Pty Ltd v Arnall’s Engineering Pty Ltd (1988) 12 NSWLR 73 at 75-76 per McLelland J.

16                                          I have read those authorities, but will not review them. They support the following propositions:

·        on the hearing of an appeal under s 60(4) of the Act (the precursor provision, with which the cases to which Young J referred were concerned, was s 60(5) of the Patents Act 1952), the only evidence to be taken into consideration is that adduced on that hearing;

·        the applicant is not obliged to put into evidence the evidentiary material that was before the Commissioner or other evidence, going to the merits of the appeal or going to actual or potential grounds of opposition;

·        where, as in the present case, the opponent has withdrawn and the Commissioner has indicated on the hearing of the appeal that she does not wish to take any active part in the proceeding, and there is no evidence before the Court capable of supporting any actual or potential ground of opposition, there is no basis on which the Court can uphold any ground of opposition.

17                                          It is important to note that in the light of the history of the application, and, in particular, the Commissioner’s acceptance of the application and the complete specification, s 61 of the Act would have obliged the Commissioner to grant the Patent if there had been no opposition to the grant. In substance, that is now the position on the appeal.

18                                          The appeal should be allowed, the Commissioner’s decision allowing the opposition should be reversed, and the Patent application should proceed to grant.

19                                          Notwithstanding his submission that it was not incumbent on Cadbury to lead any evidence addressing any ground of opposition, in order to provide some “comfort” to the Court, Mr Burley, of counsel for Cadbury, did read an affidavit of Michael Kenneth Payne of the British Library Document Supply Centre, demonstrating that document D10 was in fact received by the British Library Document Supply Centre on 3 August 1998 – well after the priority date.

20                                          The making of the orders foreshadowed above will not, of course, foreclose the question of the validity of the Patent in any future proceeding, such as a proceeding for revocation of the Patent.

Associate:

Dated: 22 September 2006