REASONS FOR JUDGMENT

1                                             This proceeding, which was commenced by Application and Statement of Claim filed on 10 March 2009, concerns Australian Standard Patent No 716,747, in respect of an invention for a stabilised growth hormone and a method of preparation thereof.  The proprietors are CSL Limited and Monash University.  They are the applicants in the proceeding, in which they allege that certain claims in the patent were infringed by the respondents, Novo Nordisk Pharmaceuticals Pty Ltd, Novo Nordisk A/S and Novo Nordisk Health Care AG.  In their Defence and Cross-Claim filed on 21 May 2009, the respondents allege that the invention was not novel, and that it lacked an inventive step, by reference to various citations of prior art said to have been published as at the priority date.  They seek a declaration of invalidity, and an order that the patent be revoked. 

2                                             By Notice of Motion filed on 6 November 2009, the applicants applied for a direction that the patent be amended pursuant to s 105 of the Patents Act 1990 (Cth).  It appears that this step was taken at least substantially to make the applicants the better able to resist the respondents’ case on validity.  The amendments sought involved the introduction of new text into claim 1 of the patent, and the deletion of existing text from claim 7.  Showing the amendments proposed, those claims would be as follows:

Claim 1:

A method for the preparation of a stable, liquid formulation of growth hormone, comprising growth hormone, a buffer and a stabilising effective amount of at least one stabilising agent selected from the group consisting of:

(i)         polyoxyethylene-polyoxypropylene block copolymer non‑ionic surfactants,

(ii)        taurocholic acid or salts or derivatives thereof, and

(iii)       methyl cellulose derivatives,

wherein the pH of the formulation is from 5.0 to 6.8, and wherein the method comprises admixing the growth hormone with the buffer and the stabilising agent(s) under conditions such that the growth hormone is not exposed to concentrations of the buffer or stabilising agent(s) which are greater than 2x the final concentrations of the buffer or stabilising agent(s) in the formulation.

Claim 7:

A method according to any of claims 1 to 6, wherein the pH of the formulation is from 5.0 to 7.5, preferably 5.0 to 6.8, more preferably from 5.2 to 6.5, and most preferably from 5.4 to 5.8.

The applicants sought also the making of an amendment to correct a typographical error in claim 3 of the patent as registered, and there was no opposition to that. 

3                                             By order made on 24 November 2009, the applicants’ s 105 amendment application is to be heard prior to, and separately from, all other issues in the proceeding.  That application is the subject of these reasons. 

4                                             Subsections (1) and (4) of s 105 of the Patents Act provide as follows:

(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.

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

In the present case, the respondents accept that the amendments sought by the applicants would be allowable under s 102.  The question remaining for the court, therefore, is whether the broad discretion which arises under s 105(1) should be exercised favourably to the applicants. 

5                                             It might also be noted that the Commissioner of Patents may, under s 104 of the Patents Act, give a patentee leave to amend his or her patent for the purpose of removing a lawful ground of objection, or of correcting a clerical error or an obvious mistake.  To the extent relevant to the present motion, the applicants have never invoked the Commissioner’s power under s 104.

6                                             The grant of the patent in suit arose from the filing by the applicants of an Australian Provisional Specification (No. PN 8012) on 12 February 1996.  An international application based on the provisional specification was filed under the Patent Co-Operation Treaty (“PCT”) on 12 February 1997 under No. PCT/AU97/00075.  It designated all countries and regions party to the PCT, including Australia.  It claimed priority from the Australian Provisional Specification.  

7                                             The applicants engaged Davies Collison Cave (“DCC”), a firm of patent and trade mark attorneys, to assist with the filing of patent applications in specific jurisdictions.  Mr John Slattery was the partner at DCC who had responsibility for the prosecution of these applications down to late 2007 or early 2008, when that function was taken over by another partner at DCC, Dr Bill Pickering.  Mr Slattery seems to have had some ongoing involvement as a consultant.  In Australia and Europe, applications were filed on 12 February 1997.  Applications were also filed in the United States of America, Russia, Canada, China, Japan, Turkey and Hong Kong.  Aside from the application which gave rise to the patent in suit, only the applications in the United States and in Europe, Russia and Canada are presently relevant.  No submission of substance was made about the applications in the other jurisdictions. 

8                                             Because the respondents’ case turns substantially upon the timing, extent and quality of the applicants’ knowledge of events arguably relevant to issues of anticipation and inventive step, it will be convenient to lay out an outline of the relevant facts chronologically, notwithstanding that this may give a somewhat disjointed image of the sequence of events in each jurisdiction.  An image of that character is presented also because the applicants did not, in their evidentiary case, provide anything which purported to be a comprehensive, or even a systematic, description of the course of the patent applications in the various jurisdictions.  The applicants were the ones who tendered such relevant documents as did find their way into the evidence, but those documents identified themselves by reason of having been provided by the applicants on discovery, at the behest of the respondents.  The patchy nature of the documentary history thus presented justifies the inference, which I draw, that there were other documents – correspondence, for instance – which related to these applications and which have not been placed into evidence.  I mean no criticism of the applicants by these observations (they are entitled to run their case as they choose), but it does have the consequence that I must recognise that, at times, relevant events may have occurred, of which there is no evidence before the court. 

9                                             In the application filed under the PCT, claims 1 and 7 were as follows:

1.         A method for the preparation of a stable, liquid formulation of growth       hormone, comprising growth hormone, a buffer and a stabilising effective        amount of at least one stabilising agent selected from the group consisting of:

(i)         polyethylene-polypropylene glycol non‑ionic surfactants,

(ii)        taurocholic acid or salts or derivatives thereof, and

(iii)       methyl cellulose derivatives,

            wherein the method comprises admixing the growth hormone with the buffer        and the stabilising agent(s) under conditions such that the growth hormone is           not exposed to concentrations of the buffer or stabilising agent(s) which are             greater than 2x the final concentrations of the buffer or stabilising agent(s) in        the formulation.

7.         A method according to any of claims 1 to 6, wherein the pH of the           formulation is from 5.0 to 7.5, preferably 5.0 to 6.8, more preferably from 5.2         to 6.5, and most preferably from 5.4 to 5.8.

10                                          The Australian, European and United States claims 1 and 7, in their original forms, are not in evidence.  However, as appears from the claims as granted in Australia (see para 2 above), only with respect to the stabilising agents listed in the first subparagraph of claim 1 do those claims relevantly depart from the corresponding claims set out in the PCT application.  Nothing presently turns on that distinction, and I am disposed to infer that the applications in each of Australia, Europe and the United States followed closely the terms of the PCT application. 

11                                          The Australian Patent Office, acting as the international searching authority for the PCT, issued an international search report for the PCT application on 16 April 1997.  Of the six prior art documents cited in that report, two were described as “defining the general state of the art which is not considered to be of particular relevance”.  Those citations (which are amongst the citations relied on by the respondents in their Particulars of Invalidity) were identified as “D1” and “D2” in the present proceeding.  D1 is European Patent Application No. 86305824.4 which resulted in European Patent No. 0 211 601 said by the respondents to have been open for public inspection at the Australian Patent Office, Canberra on 24 March 1987 (and the corresponding Australian Patent Application No. AU 60733/86 S published 5 February 1987 and the corresponding Japanese Patent Application No. 070319/1987).  D2 is an article entitled “Effect of Surfactants on the Physical Stability of Recombinant Human Growth Hormone” by Katakam M. et al, published in 1995 in the Journal of Pharmaceutical Sciences Vol 84 No. 6 pp 713-716, and said by the respondents to have been available to the public in Australia at the C L Butchers Pharmacy Library, Monash University on 19 July 1995.  The search report of 16 April 1997 described D1 also as a “document of particular relevance, the claimed invention cannot be considered novel or cannot be considered to involve an inventive step when the document is taken alone”.  Notwithstanding these reservations, on 16 January 1998, an international preliminary examination report was issued which cited D1 (but not D2), and in which the examiner found that claims 1-9 of the PCT application were novel and involved an inventive step on the basis that none of the prior art citations specifically disclosed the concentration limitations of the growth hormone, buffer and stabilising agents as claimed in those claims. 

12                                          In Australia, the examiner’s first report was issued on 3 September 1998.  The examiner concluded that there were lawful grounds of objection to the application, including that claims 1-9 lacked an inventive step in light of prior art citations which included D1.  The examiner (the same one who had opined some eight months previously that claims 1-9 in the PCT application involved an inventive step) said:

[D1] discloses the use of block copolymer polyocyethylene‑polyoxypropylene (sic) to stabilise a growth hormone formulation. 

A person skilled in the art would be able to work out the concentration of growth hormone and stabilising agents. 

Claims 1-9 therefore lack an inventive step.

The examiner gave the applicants 21 months to overcome these objections. 

13                                          In Europe, following the submission of amended claims 1-10 to the European Patent Office in September 1998, a supplementary search report was published on 7 September 1999, citing D2 and other items of prior art as being relevant to claims 1-10, and described as “particularly relevant if taken alone”. 

14                                          It is not entirely clear from the evidence, but it appears that the application in the United States was filed on 25 March 1999. 

15                                          Returning to Australia, on 23 December 1999 the applicants responded to the examiner’s report of 3 September 1998.  They submitted that “the assertion that [claims 1-9] lack inventive step is totally without foundation and is based on the impermissible use of hindsight in the light of the teaching of the present application”.  They continued:

… the Examiner has failed to appreciate that claim 1 does not simply recite considerations of growth hormone and stabilising agents, rather it defines a specific procedure for preparation of a stable, liquid formulation of growth hormone which does not result in the formation of undesirable aggregated species or cause chemical changes that reduce biological activity or alter receptor recognition.  Document D5 contains no disclosure or teaching whatsoever which would lead the person skilled in this art to adopt the conditions of mixing as recited in claim 1, and in fact this document contains no disclosure or teaching that any particular mixing conditions need to be adhered to.

16                                          The patent in suit was granted on 12 January 2000.

17                                          The next presently relevant event occurred in the United States.  On 25 October 2000, the US Patent and Trade Mark Office published an Office Action, in which it rejected claims 1-9 for lack of specificity, asserting that the language used in the claims rendered them indefinite.  Claims 1-9 were also rejected as anticipated by, or, as obvious in the light of, D1 and other citations.  The Office said that D1 “teaches a method for preparing a liquid formulation comprising a GH, buffer and a stabilizing compound as claimed”.  The applicant’s US agents forwarded the Office Action to DCC on 19 December 2000, and sought instructions regarding how to overcome the objections.  They pointed out that, according to the examiner, D1 –

… [claimed] a formulation of growth hormone, buffer, and a block copolymer.  The polyoxyethylene-polyoxypropylene block copolymer is specifically mentioned.  The bioavailability and stability of growth hormone are preserved in this formulation according to these patent applications.

The agents sought DCC’s response to these and other points. 

18                                          In Russia, on 11 January 2001, the Patent Office issued an Official Action in respect of application No. 9817135, which referred to D1 (amongst other citations), saying that it –

… discloses a method for stabilisation of the hormones promoting growth, which comprises admixing the growth hormone and non‑ionic surfactant – polyoxyethylene‑polyoxypropylene block copolymer in the presence of water, also various buffer additives, i.e. eventually disclosure is made of a method for he (sic) preparation of a stabilized growth hormone composition.

On 31 January 2001, the applicants’ Russian agents sent the Official Action to DCC seeking instructions as to how to respond.  

19                                          On 20 February 2001 in the European application, the examiner noted that certain “clarity objections” needed to be met before a substantive examination could be carried out, including that “claim 1 appears to lack essential features (pH values?)”.  The applicants’ European patent attorneys reported to DCC on 27 February 2001. 

20                                          On 1 March 2001, DCC responded to the applicants’ US agents with respect to the examiner’s anticipation point based on D1:

In this regard, the Examiner asserts that these references teach methods for preparing liquid formulations comprising growth hormone, buffer and a stabilizing compound, and because the claims are drawn to a method of producing a stabilized growth hormone formulation “using the method and ingredients taught by the art” the claims are anticipated or rendered obvious in view of the art.  Once again, the Examiner has ignored the fact that claim 1 recites a specific method step in which the growth hormone is admixed with the buffer and the stabilizing agents(s) under conditions defined in the claim.  None of the prior art documents relied on by the Examiner teaches a method for preparing a lipid formulation in which the admixture is carried out under these conditions, nor is there any disclosure or teaching in any of these documents to use the conditions recited in claim 1 in the preparation of a stable, liquid formulation of growth hormone.  Accordingly, it is considered that the Examiner’s suggestion that the claims are anticipated or rendered obvious in view of these prior art documents is quite unjustified and without proper foundation. 

21                                          Further correspondence – not in evidence – appears to have followed, since a letter to DCC from the US agents on 19 March 2001 referred to a letter from DCC of 14 March 2001.  That letter caused the agents to make the following request in their letter of 19 March 2001:

We are writing to solicit your comments regarding the “2x” limitation in the claims.  On page 10 line 30 of [D1], the applicant states that “isotonic physiological phosphate buffer having a pH of 7.3 was prepared from sodium hydrogen phosphates (0.1 M phosphates) plus 0.2 percent NaN_3..  Using this buffer, a solution of 18 percent by weight of PLURONIC F 127 was prepared by mechanical mixing.  Then a ca. 40 mg portion of porcine growth hormone…was wetted with 100 µ of the solution.”  We understand that this [sic] passage as referring to adding hGH to 1x buffer solution.  Please let us know if our understanding is not correct. 

We would appreciate your comments on how the claims for the McNamara application would be considered novel in light of [D1], and other applications cited by the examiner. 

In a response of 18 April 2001, DCC proposed an amendment:

Following our further review of this cited document, our clients have pointed out that in Example 1 of [D1], commencing at page 10 line 30, the porcine growth hormone is admixed as a solid (“ca. 40mg portion”) with the buffer solution containing Pluronic F127.  In contrast, in the method of the present invention, the growth hormone is mixed with the buffer and stabilizing agent as a “liquid formulation”, not in solid form.  Accordingly, in order to provide a clear basis for distinguishing the disclosure of this cited document, it is now proposed to reword claim 1 of the present application to define the method as admixing “a solution of” the growth hormone with the buffer and the stabilizing agent(s).  In this regard, basis for the use of a solution can be found in Example 3 on pages 20-21 of the present specification which refers to the use of “purified hGH solution”.  Further support of such amendment can be found on page 9, 2nd paragraph, “Preferred formulation of stabilizing agents and hGH”, of the specification, which reads that “.. one or more stabilizing agents are added to a hGH liquid formulation…(emphasis added).”

22                                          On 25 April 2001, the US agents submitted a response to the Office Action on behalf of the applicants in which they sought an amendment to claim 1 to include the words “a solution of” with reference to the growth hormone to which the buffer and stabiliser were added.  The purpose of the amendment was to overcome the Office’s finding that claims 1-9 were anticipated by D1 and other citations.  The letter stated that none of the references relied on by the examiner (ie including D1) –

… teach a method of preparing a stable formulation of growth hormone that comprises admixing a solution of growth hormone with buffer and stabilizing agent(s) under conditions such that the growth hormone is not exposed to concentrations of said buffer or stabilizing agent(s) that are greater than 2x the final concentrations of said buffer or stabilizing agent(s) in the formulation.  Therefore, this rejection should be withdrawn.

The agent’s letter also stated that claim 9 was “cancelled without disclaimer or prejudice”.

23                                          An Office Action in response was issued on 13 July 2001, in which the examiner in the United States maintained the objection that claims 1-8 lacked novelty, or were obvious, in the light of D1 and another citation for the reasons previously given.  On 6 August 2001, the US Attorneys forwarded the Office Action to DCC and sought comments. 

24                                          On 15 August 2001, DCC instructed the European patent attorneys to seek an amendment to claim 1 to refer to admixing “a solution of” growth hormone.  This was effectively the same amendment which had been sought four months previously in the United States.  In relation to the specification of pH values, DCC asserted that “the use of any particular pH value is not an essential feature of the present invention”.  The European patent attorneys communicated these instructions to the European Patent Office on 22 August 2001.  

25                                          On 7 September 2001, DCC instructed its Russian agents to prepare and to file a response to the Official Action dated 11 January 2001.  In addition to an amendment to claim 3 to correct a typographical error, and the addition of some wording in claim 10, the applicants sought to amend claim 1 specifically to recite the concentration of the stabilising agent in the formulation, and also to refer to admixing “a solution of” growth hormone.  In their letter, DCC said:

In addition, it is proposed to amend the claims so that the method is specifically recited as admixing “a solution of growth hormone” with the buffer and the stabilising agent(s) under the specific conditions, namely that the growth hormone “is not exposed to concentrations of the buffer or stabilising agent(s) which are greater than 2x the final concentrations of the buffer or stabilising agent(s) in the formulation”.  Clearly, the amended claim defines the relationship between the growth hormone and the concentrations of the buffer or stabilising agent(s) to which the growth hormone is exposed during the admixture; and in addition, the amended claim specifically recites the concentration of stabilising agent(s) in the formulation.  Please point out to the Examiner that [D1] does not disclose a method in which a solution of growth hormone is mixed with the buffer and the stabilising agent(s).  In particular, Example 1 of this cited document, commencing at page 10 line 30, refers to the porcine growth hormone as being admixed as a solid (“c.a. 40mg portion) with the buffer solution containing Pluronic F127”.  Accordingly, the method now set out in amended claim 1 can be clearly distinguished from the disclosure or teaching of [D1].

26                                          On 14 January 2002, following the instructions of DCC, the applicants’ US agents wrote to the US Patent and Trademark Office, seeking the making of further amendments (upon which it is not presently necessary to elaborate), and reiterating what they had previously said in defence to the Office’s reliance on prior art.  The agents said:

[The] prior art documents cited by the Examiner do not teach or disclose a method for preparing a stable formulation of liquid growth hormone which embodies the specific method step and ratios recited in claim 1.  In other words, the prior art does not specify that the growth hormone is exposed to buffer concentrations no greater than 2X the final concentration of buffer.… Additionally, the prior art does not provide a motivation for using this specific method step in the preparation of a stable growth hormone formulation whose chemical instability arising from increased stabilizer concentration is minimized.

27                                          An Official Decision of Grant was issued by the Russian Patent Office on 30 January 2002.  The Russian agents wrote to DCC to inform them of this on 8 February 2002, and enclosed the allowed claims, which included the “a solution of” amendment, as well as the specific concentration of the stabilising agent.  The date of publication of Russian Patent No. 2191029 was 20 October 2002.  Claim 1 in the Russian patent as granted read as follows:

A method for the preparation of a stable, liquid formulation of growth hormone, comprising growth hormone, a buffer and a stabilising effective amount of at least one stabilising agent selected from the group consisting of:

(i)         polyoxyethylene-polyexypropylene block copolymer non-ionic surfactants,

(ii)        taurocholic acid or salts or derivatives thereof, or

(vi)       methyl cellulose derivatives,

wherein the method comprises admixing a solution of growth hormone with the buffer and the stabilising agent(s) under conditions such that the growth hormone is not exposed to concentrations of the buffer or stabilising agent(s) which are greater than 2x the final concentrations of the buffer or stabilising agent(s) in the formulation, and wherein the final concentration of stabilising agent(s) in the formulation is 0.01-5.0% w/v.

28                                          In the material before the court, there is no correspondence, document or other evidence relevant to the applicants’ application in the United States subsequent to the agents’ letter of 14 January 2002 to which I have referred above.  All the court knows is that United States Patent No. 6593296 was granted on 15 July 2003. Claim 1 read as follows:

A method for the preparation of a stable, liquid formulation of growth hormone, comprising growth hormone, a buffer and at least one stabilizer selected from the group consisting of:

(i)         polyoxyethylene-polyexypropylene block copolymer non-ionic surfactants,

(ii)        taurocholic acid or salts or derivatives thereof, or

(v)        methyl cellulose derivatives,

wherein the method comprises the step of adding said buffer and stabilizer(s) to a solution of growth hormone such that the growth hormone is not exposed to concentrations of said buffer or stabilizer(s) that are greater than two times the final concentrations of said buffer or stabilizer(s) in the formulation, such that the formulation is suitable for prolonged storage at temperatures below and above freezing.

29                                          To this point, the applicants had achieved registration in Australia, the United States and Russia (and, I add for the record only, in Turkey in August 1999).  In Australia, that had been done without the need to make any amendment that is presently relevant, and over the examiner’s original view that D1 stood in the way of the applicants being able to establish that the invention involved an inventive step.  In the United States and Russia, the applicants made the “a solution of” amendment in circumstances where D1 was amongst the citations relied upon for the examiners’ initial adverse assessments.  It is not, of course, absolutely clear in either case that the amendment was critical in the respective agency’s decision to grant registration, but the sequence in each case was that the objection was raised, the amendment was made, and the patent was registered. 

30                                          The next relevant series of events occurred in Canada.  On 22 September 2003 the Canadian Intellectual Property Office issued its first examination report in respect of the applicants’ patent application No. 2246501, citing D2 as anticipatory of claims 1-4, 6, 7 and 9.  The applicants’ Canadian agents forwarded the examiner’s report to DCC on 9 October 2003 and requested comments on the citing of D2, which they noted was also cited in the international search report.

31                                          On 16 March 2004, DCC wrote to the Canadian agents asking them to amend claim 1, specifically to recite the concentration of the stabilising agent in the formulation, and to refer to admixing “a solution of” growth hormone. DCC commented that D2 had been included in the international search report as a “document defining the general state of the art, and not considered to be of particular relevance”.  Their letter continued:

However, the Canadian Examiner suggests that the subject matter of the claims set out above was described by Katakan et al. prior to the priority date, and it appears that the Examiner has failed to appreciate that claim 1 is directed to a method in which the growth hormone is admixed with the buffer and stabilising agent(s) under specified conditions, specifically, that the growth hormone “is not exposed to concentrations of the buffer or stabilising agent(s) which are greater than 2x the final concentrations of the buffer or stabilising agent(s) in the formulation”.  The cited document describes the dissolution of “freeze‑dried” recombinant hGH in various detergent solutions, including Pluronic F68, however this document contains no disclosure or teaching of admixing the growth hormone with the buffer and stabilising agent under the specific conditions recited in the claim.  Furthermore, the amended claim now proposed is clearly distinguished from the disclosure in the cited document in that it specifically recites admixture of “a solution of growth hormone” with the buffer and stabilising agent(s), whereas the cited document describes dissolution of “freeze‑dried” growth hormone.  Finally, in this regard, amended claim 1 as set out above further recites the final concentration of the stabilising agent(s) in the formulation.  Accordingly, it is considered that the method as recited in amended claim 1 is quite clearly distinguished in the recited steps from the disclosure of the cited document. 

The Canadian agents prepared and filed a response on this basis on 22 March 2004, and reported back to DCC on the same day. 

32                                          Returning to Europe, it will be recalled that the last relevant communication was that of 22 August 2001 to which I referred in para 24 above.  At least according to the material in evidence, nothing occurred until 21 June 2005, when the examiner found that claims 1-7 were novel and involved an inventive step.  In March 2006, the European Patent Office gave notification of its intention to grant the patent.  European Patent No. 0889733 was granted on 27 September 2006. 

33                                          Claim 1 as granted in Europe was as follows:

A method for the preparation of a stable, liquid formulation of growth hormone, preferably human growth hormone, comprising growth hormone, a buffer and a stabilising effective amount of at least one stabilising agent selected from the group consisting of:

(i)         polyoxyethylene-polyexypropylene block copolymer non-ionic surfactants,

(ii)        taurocholic acid or salts or derivatives thereof, or

(iv)       methyl cellulose derivatives,

wherein the method comprises admixing the growth hormone with the buffer and the stabilising agent(s) under conditions such that the growth hormone is not exposed to concentrations of the buffer or stabilising agent(s) which are greater than 2x the final concentrations of the buffer or stabilising agent(s) in the formulation, and wherein the final concentration of stabilising agent(s) in the formulation is 0.01-5.0% w/v.

It may be noted that, notwithstanding the amendment proposed by the applicants in August 2001, there is no reference to “a solution of” growth hormone in the final version of the European patent as granted.  No explanation for that circumstance was advanced on the hearing of the present motion.

34                                          On 26 June 2007, the second respondent filed a Notice of Opposition to the European patent, in which it sought revocation on the grounds that the patent lacked novelty in light of eight items of prior art (including D1 and D2), and also lacked an inventive step.  By then, in addition to Europe and the jurisdictions referred to in para 29 above, the applicants had achieved registration in China (on 31 December 2003) and in Hong Kong (on 16 March 2007).  However, it was not until the second respondent’s Notice of Opposition in Europe that the applicants had, it seems, confronted an opponent to the registration, or continued registration, of any of their claims.  Such resistance as they encountered had come from the various registration authorities.

35                                          In August 2007, Peter Turvey, a senior executive with responsibility for the research and development department at the first applicant, asked John Cox, a consultant scientist and intellectual property consultant to the first applicant, to manage the conduct of the European opposition on behalf of the applicants.  Mr Cox then engaged Andrew Sheard, a patent attorney in the United Kingdom, to defend the patent in the opposition proceedings.  Mr Cox and Mr Sheard discussed the grounds of invalidity that had been raised by the second respondent, and also each of the prior art documents that had been cited against the European Patent.  Mr Sheard emailed Mr Cox on 10 October 2007, advising the applicants to consider “whether there is any amendment to the Patent that should be made, either in response to a ground of opposition raised by [the second respondent] or in response to a ground that they could have raised”. 

36                                          Unlikely as it may seem to those familiar with a different rate of progress, it was on 10 December 2007 that the Canadian Intellectual Property Office dealt with the response which had been filed on behalf of the applicants on 22 March 2004.  The Office maintained its rejection of claim 1 (amongst others) as anticipated by D2, and cited D1 as new prior art.  Dealing with D1 (identified as “Blum”), the examiner said:

Blum disclosed the claimed subject matter before the claim date.  Blum discloses a method for preparing stable liquid formulations of GH, which comprises admixing GH, Pluronic® F127, which is a polyoxyethylene‑polyoxypropylene block copolymer, and phosphate buffered saline (PBS).  The thus produced liquid formulation comprises 1 mg/ml GH and 5% w/v Pluronic® F127 in PBS.  Further, the GH is not exposed to concentrations of buffer or stabilizing agent greater than 2X the final concentration of buffer or stabilizing agent.  As such, when a polyoxyethylene‑polyoxypropylene block copolymer is used as the stabilizing agent in the liquid formulations of GH of the instant application, the method for preparing a stable, liquid formulation of GH, comprising admixing GH, a buffer and a stabilizing agent (claims 1-2, 5, 7-10 and 14) and said thus produced formulations (claim 15) encompass and are anticipated by Blum.  Further, Blum discloses the use of liquid formulation of GH for promoting growth in animals thereby anticipating claims 17‑18.

Dealing with D2 (identified as “Katakam”), the examiner said:

Katakam et al. disclosed the claimed subject matter before the claim date.  Katakam et al. discloses a method for preparing stable liquid formulations of human growth hormone (hGH), which involves adding hGH and Pluronic® F68, which is a polyoxyethylene‑polyoxypropylene block copolymer to a phosphate buffer.  In Applicant’s correspondence dated March 22, 2004, Applicant states that Katakam et al. describe the dissolution of freeze‑dried recombinant hGH in various detergent solutions with buffer.  However, Applicant erroneously interpreted the formulations of Katakam et al.  Katakam et al. discloses a method for preparing stable liquid formulations of hGH, which involves reconstituting freeze‑dried hGH in phosphate buffer and the addition of Pluronic® F68.  The thus produced liquid formulation comprises hGH, 20 mM phosphate buffer and 0.1%-10% Pluronic® F68.  While Katakam et al. use freeze‑dried hGH as the source of hGH the resultant formulation prepared by their method is a liquid formulation of hGH.  Further, since both hGH and Pluronic® F68 are reconstituted in phosphate buffer, the hGH is not exposed to concentrations of buffer or stabilizing agent greater than 2X the final concentration of buffer or stabilizing agent.  As such, when a polyoxyethylene‑polyoxypropylene block copolymer is used as the stabilizing agent in the liquid formulations of GH of the instant application, the method for preparing a stable, liquid formulation of GH, comprising admixing GH, a buffer and a stabilizing agent (claims 1-5, 7-10 and 14) and said thus produced formulations (claim 15) encompass and are anticipated by the methods and liquid formulations of GH of Katakam et al.

37                                          Returning to Europe, on 11 and 14 January 2008 Mr Cox and Mr Sheard met in London to discuss the preparation of the applicants’ response to the second respondent’s opposition.  Central to those discussions was the relevance of the pH of the formulation then claimed in claim 1 of the European patent.  At the time (as was and is the case with the patent in suit), there was no specification of pH in that claim.  It seems that Messrs Cox and Sheard canvassed the prospect that the introduction of a pH range might strengthen the applicants’ chances of resisting the prior art, particularly D1 and D2.  Either on the weekend which lay between 11 and 14 January 2008, or shortly after 14 January, Mr Cox prepared some notes in which he considered the significance of pH to the chemical and physical stability of the formulation, and the extent to which any pH range had been disclosed in the prior art. 

38                                          On 23 January 2008, Mr Cox sent the following email to Mr Sheard, with a copy to Mr Turvey:

What follows are some comments further analysing our patent (EPO 889 7333) and then a reanalysis of D1, D2, D5, D6 and D7 which I see as the critical prior art.  I have not covered those aspects that we already discussed but have rather, as you requested, tried to address inventive step.  I am happy to discuss with you by phone if you wish.

At least to the extent presently relevant, Mr Cox’s “comments” were based on the notes to which I have referred.  Speaking first of the European patent, in those comments Mr Cox said:

−          Defines chemical degradation as deamidation or sulphoxylation and physical         degradation as formation of dimers and aggregates [0009].

−          Teaches that dimers, aggregates and chemical changes should be avoided            [0011-12].

−          Also teaches that stability to interfacial stress increases directly with        concentration of stabilizer but chemical stability is inversely affected by      concentration of stabilizer [0033].

−          The examples then establish the following:

Thus a double conflict is created.  It is important for the liquid formulation of hGH to be able to resist both physical (interfacial) stress and chemical degradation which is usually assessed as thermal stress.  However, neither a preferred pH nor an optimal concentration of non‑ionic block copolymer are apparent from the technical results which suggest you can optimise for physical or chemical stability but not both.  The method of the present invention was devised to resolve this dilemma.

D1

−          No teaching about pH conflict.  Used pH7.3.

−          Only considered how to avoid physical instability.

−          Used very high concentrations of F127 (18% and 5%).

D2

−          No teaching about the pH conflict.  Used pH7.4

−          Showed that concentrations above the CMC stabilised against physical stress       (Fig. 4).

−          Showed that any level of F68 destabilised to thermal stress (Fig. 6).

−          Did not make any suggestion on how to solve this dilemma.

At this point, according to Mr Cox’s evidence, he and Mr Sheard had not reached a “concluded view” as to the introduction of a pH range into the European claim 1. 

39                                          In February 2008, Mr Cox learned that an American company had obtained the approval of the Food and Drug Administration for a liquid human growth hormone formulation which appeared to have a pH of about 6.5.  By email to Mr Sheard of 13 February 2008 (with a copy to Mr Turvey), Mr Cox suggested (in effect) that, if there were to be any amendment made to the European claim 1, it should not be such as specified a pH range within which 6.5 did not fall. 

40                                          On 6 April 2008, Mr Sheard forwarded to Mr Cox (with a copy to Mr Slattery) a draft of the response which he (Mr Sheard) proposed to file in the European opposition proceedings.  The response would include two requests: a “main request”, that the European Patent be maintained on the basis of the claims as granted; and (2) the “first auxiliary request”, that the European Patent be maintained on the basis of certain amended claims, including the introduction of a pH range to the formulation in claim 1.  That range would be 5.0 to 6.8 (ie the same amendment as is presently proposed for the patent in suit).  In the draft response, it was proposed to support the main request only with the following submission:

(6)        Our Main Request is for the Patent to be maintained as granted.

(7)        We do not currently intend to comment on the Main Request.

In his email of 6 April 2008, Mr Sheard said:

I have kept the main request as the patent as granted, simply to give flexibility in the event of an appeal.  The first auxiliary request is what is defended in the response.

That is to say, the applicants effectively had no submission to make at all in response to the second respondent’s point that claim 1, in its unamended form, had been anticipated by the prior art relied on. 

41                                          On 11 April 2008, the applicants filed their response in the European opposition proceedings.  To the extent presently relevant, it was as proposed by Mr Sheard in his draft of 6 April 2008.

42                                          On the present motion, neither Mr Slattery nor Dr Pickering was called.  Mr Turvey was called as the applicants’ executive with responsibility both for the European opposition proceedings and, to the extent that they arose at the time, for any issues that related to the patent in suit.  It was he who instructed Mr Cox to “implement [the] strategy” in Europe of introducing pH limitations that would “enhance the prospects of eliminating the prior art relied on by [the second respondent] as novelty references if the EPO took the view that the novelty references did anticipate one or more of the claims as granted”.  He was cross‑examined as follows:

And you knew that in the European opposition, Novo Nordisk had, in 2007, raised citations as to the – going against the novelty of claim 1 in the European patent.  You knew that those claims had been investigated carefully by Mr Cox and Mr Sheard?­­­Yes.

You knew that a decision had been made to effectively advance no argument in answer to Novo Nordisk on the main request, but to suggest amendments by an auxiliary request?­­­I did.

And you knew that those novelty citations were citations which raised serious questions on the novelty of claim 1?­­­I did.

And you knew that the form of claim 1 in the Australian patent was comparable to the form of claim 1, with one variation, in the European patent?­­­I did.

And you knew that what was missing in the Australian patent, and in the European patent, was any pH limitation, and that was the subject on which you had received advice in Europe, to propose the auxiliary request?­­­Correct.

Notwithstanding the circumstances which Mr Turvey accepted, the applicants did not then move to make any corresponding amendment to the patent in suit.  Indeed, there is no evidence that they even then took advice on the question. 

43                                          The applicants were, however, obliged to so something in response to the Canadian examiner’s detailed discussion of D1 and D2 to which I have referred in para 36 above.  Their response adopted the approach that had been taken in Europe.  On 10 June 2008, DCC instructed the applicants’ Canadian agents to request an amendment to claim 1 to insert the phrase “and wherein the pH formulation is from 5.0 to 6.8”.  DCC explained in its letter to the agents that the specification of the concentration of the stabilising agent(s) together with the insertion of the pH limitation demonstrated novelty, and an inventive step, over D1 and D2.  This submission was communicated to the Canadian Intellectual Property Office by the Canadian agents by letter dated 10 June 2008. 

44                                          The Canadian Patent is yet to be granted.

45                                          In July 2008, the possibility that the respondents, or entities associated with them, might be about to infringe the patent in suit came to the attention of Mr Turvey.  As a result, the applicants engaged Mr Ian Pascarl of Davies Collison Cave Law (“DCCL”) (then, and until 1 January 2010, known as Davies Collison Cave Solicitors).  The applicants first contacted Mr Pascarl on 8 July 2008, when Chela Niall (corporate counsel for the first applicant) telephoned him and advised him that one or more companies within the Novo Nordisk group may be infringing the patent and (amongst other things) that (in Mr Pascarl’s words) “a European patent with similar claims to the patent had been granted to [the applicants] … but was the subject of a post‑grant opposition by [the second respondent]”.  A more comprehensive briefing was provided to Mr Pascarl by Mr Turvey, Mr Cox and Ms Niall on 21 July 2008, but there is no suggestion in the evidence that either the European opposition proceedings were, or that any aspect of the applicants’ experiences in foreign jurisdictions was, discussed. 

46                                          Between August 2008 and February 2009, DCCL corresponded with the respondents and their solicitors, requesting disclosure of the method of formulation of the recombinant human growth hormone imported, marketed and sold by the respondents under the brand name Norditropin, in an effort to determine whether it infringed the patent in suit.  DCCL also filed freedom of information requests with the Department of Health and Ageing, requesting production of documents in relation to the respondents’ application to register Norditropin as a pharmaceutical medicine on the Australian Register of Therapeutic Goods. 

47                                          In November 2008, Mr Pascarl formed the view that there was insufficient information available to enable him to advise the applicants whether patent infringement proceedings should be instituted against the respondents and, as a consequence, the first applicant instructed him to issue an application for pre-trial discovery.  The respondents’ solicitors made a proposal in settlement of the pre-trial discovery application on 26 November 2008, and, on 1 December 2008, orders were made by consent facilitating the provision of certain documents to DCCL.  On 4 December 2008, further orders were made adjourning the pre-trial discovery application until 6 February 2009, to enable DCCL sufficient time to review the documents provided and to determine whether the pre‑trial discovery application was still required.  

48                                          Also on 26 November 2008, DCCL held a telephone conference with Mr Turvey, during which the possibility of bringing infringement proceedings, and the possibility of a revocation cross-claim being made by the respondents, were discussed.  Mr Pascarl asked Mr Turvey whether the applicants had considered narrowing the scope of the claims of the patent in suit, to which Mr Turvey responded that he wanted that “to be high on the agenda” in order to “strengthen the claims and still catch them”.  As to his state of knowledge at this time, Mr Turvey was cross‑examined as follows:

You knew, didn’t you, in November 2008, that detailed – there had been a detailed analysis of prior art citations raised by Novo in Europe?­­­I was aware of that, yes.

And you knew that as a consequence of the advice of your advisers, an amendment had been proposed in Europe to narrow the scope of claim 1 to overcome those citations?­­­I was aware of that.

And you knew that that limit, narrowing limitation, related to a significant issue in the patent, the pH?­­­I was aware of that.

And you knew, in November 2008, that there was no such limitation in claim 1?­­­In the Australian patent?

In the Australian patent?­­­I knew that.

49                                          Following a review of the documents provided to them, DCCL formed the view that entities within the respondents’ group were infringing the method claims of the patent in suit, and on 10 March 2009, the present proceeding was commenced.  It was not accompanied by any application to amend under s 105 (and, of course, there had been no application to amend under s 104) of the Patents Act.  The respondents filed their Defence, Cross-claim and Particulars of Invalidity on 21 May 2009, citing as anticipatory various items of prior art which included D1 and D2. 

50                                          On 25 May 2009, the Opposition Division of the European Patent Office published its non-binding Preliminary Opinion on the second respondent’s opposition to the European patent.  In relation to the main request, the European Patent Office indicated that it was inclined to find against the applicants on novelty and added subject-matter, but expressed no view on inventive step and insufficiency.  In relation to the first auxiliary request, the European Patent Office indicated that the requirements of novelty were satisfied. 

51                                          A meeting was held on 2 June 2009, which was attended by representatives of the first applicant and DCCL. Prior to this date, DCCL had not advised on any European Opposition documents, and Mr Pascarl had not seen any such documents before the meeting.  Indeed, when asked when he first had a conversation with Mr Pascarl about the amendments that had been made in other jurisdictions, Mr Turvey said:

My recollection was that the first time we looked at the Australian patent was when we got the result or so-called preliminary opinion from the European Patent Office in response to our response.

Mr Pascarl’s only previous awareness of the European opposition proceedings, it will be recalled, was by way of the brief telephone conversation he had had with Ms Niall on 8 July 2008.  During the meeting of 2 June 2009, those present discussed the grounds of invalidity relied upon by the respondents in Australia and Europe, noting that the Particulars of Invalidity filed in this proceeding cited each of the prior art documents relied upon in the European opposition proceedings.  They noted the Preliminary Opinion that the European Patent as granted was anticipated by the prior art cited by the second respondent, but that the European patent would be novel over those prior art citations if amended in accordance with the first auxiliary request.  It was decided that the applicants should consider amending the Australian patent to include a pH limitation, and the first applicant instructed DCCL to advise on possible amendments to the claims of the Australian patent with a view to strengthening it in light of the Preliminary Opinion. 

52                                          According to the evidence of Mr Pascarl, further meetings were held involving counsel, the inventors, Mr Slattery and Mr Sheard throughout June, July and August 2009, at which possible amendments to the patent in suit were considered. Following these discussions, DCCL recommended that the applicants amend the patent in order “to overcome the novelty citations that the Opposition Division of the EPO, in its Primary Opinion dated 25 May 2009, suggested would anticipate the equivalent claims in the corresponding European Patent unless those claims were amended to limit the pH range of the formulation…”.  That led to the present motion to amend.  

53                                          In the exercise of its discretionary judgment under s 105 of the Patents Act, it was accepted by both sides that the court should generally be guided by the principles referred to in the judgment of Aldous J in Smith Kline and French Laboratories Ltd v Evans Medical Ltd [1989] 1 FSR 561, 569:

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 has been applied in Australia: Novartis AG v Bausch & Lomb (Australia) Pty Ltd (2004) 62 IPR 71 at 90 [67]; Rescare Ltd v Anaesthetic Supplies Pty Ltd (unreported, Federal Court of Australia, 4 March 1993) at [17] and [18]; Gambro Pty Ltd v Fresenius Medical Care South East Asia Pty Ltd (1999) 48 IPR 625 at 638-9 [69]; Wimmera Industrial Minerals Pty Ltd v RGC Mineral Sands Ltd (No 3) (1997) AIPC 91-366 at 39,789-90. 

54                                          The applicants submitted that the court should not approach the exercise of its discretion under s 105 “in a manner hostile or antipathetic to any amendment”, relying in this respect upon the judgment of Sundberg J in Wimmera Industrial Minerals Pty Ltd v RGC Mineral Sands Ltd (No 3) [1997] AIPC 91-366, and upon that of Bennett J in Apotex Pty Ltd v Les Laboratoires Servier (No 2) (2009) 83 IPR 42, 57 [88].  That was accepted by the respondents, and I shall act in accordance with it.  Indeed, I would go further and observe that s 105 appears to have a beneficial purpose and that, generally speaking, the approach of the court should be such as will achieve that purpose.  This is, of course, to go no further than to agree with the second principle to which Aldous J referred in Smith Kline, namely, that amendments will be allowed provided that they are permitted under the Act, and that no circumstances arise which would lead the court to refuse them: see ICI Chemicals and Polymers Ltd v Lubrizol Corp [1999] FCA 1417 at [37]. 

55                                          The respondents’ case is that the applicants, first, “have not made full and frank disclosure of the reasons why they seek to amend”, secondly, “have unreasonably, if not ‘culpably’, delayed in seeking to amend”, and, thirdly, “have sought to obtain an unfair advantage” from the unamended patent by suing for infringement while knowing that the patent ought to be amended.  Here the respondents rely on the first, third and fourth principles, respectively, articulated by Aldous J in Smith Kline.  For my own part however, I do not find it useful to consider each of these principles as a discrete fatal element in the mix of facts by reference to which the present motion should be determined.  Rather, each is an important ingredient in that mix, having the potential to inform the exercise of the court’s discretion under s 105. 

56                                          I would also say that I do not read the first principle of Aldous J as in effect a disciplinary sanction to be imposed on a patentee who has not disclosed “all the relevant matters”.  Rather, it is, in my view, a recognition of the circumstance that a court considering a s 105 application will be ill‑equipped to give the matter the attention it deserves if some relevant facts have not been disclosed.  Thus, if some important facts were not originally disclosed by the patentee, but have been disclosed as a result of the forensic process itself, the court should, in my view, proceed to consider the application on its merits.  This is relevant on the present motion, since a deal of the early material – and, on one view, much of the material generally that is most clearly adverse to the applicants – has been brought to light only by the respondents’ strenuous insistence on the applicants’ observance of their discovery obligations.  I propose to determine the motion by reference to all of the material which is before the court, however it came to be so. 

57                                          An important circumstance that sets the present case apart from some others that have come before the court is that it is not common ground, and it has not been determined, that the patent in suit is invalid, either on the grounds advanced by the respondents or at all.  Indeed, while insisting that the point was not presently before me for determination, the applicants made clear their position that, if need be, they would defend the patent in its present form.  Mr Cox went further under cross‑examination, and left no doubt but that he considered the patent to be valid, and to be able to withstand a challenge from the citations relied on by the respondents (albeit that he was, as the respondents stressed, a scientist rather than a lawyer).  For their part, the respondents did not invite me to find, at this stage, that the patent was invalid.  They accepted that that was a matter for another day.  Their case was not, therefore (and, it seems to me, could not be) that the applicants must, at some previous time, have “known” that the patent was invalid, or that there was a “need” to amend in the sense of being the only way of avoiding an inevitable finding of invalidity.  Rather, their case was that the applicants were, at earlier times, squarely on notice that the prior art cited (particularly D1 and D2) raised real questions about validity to which the applicants, acting reasonably as ought to be required of the beneficiaries of a statutory monopoly, had no choice but to give serious attention.  According to the respondents’ case, if the applicants were going to amend, they should have done so, or at least should have a reasonable explanation for not having done so, at one or other of those earlier times.  It was not open to them to allow matters to remain in statu quo then, and to apply to amend only much later.  It was in this sense that the respondents gave practical application to what some of the cases have described as “the need for an amendment” (e.g. Novartis AG v Bausch & Lomb (Australia) Pty Ltd (2004) 62 IPR 71 at 106 [133]). 

58                                          The applicants’ case involved the following propositions.  First, the court ought not approach the exercise of its discretion in a way which is hostile to amendment.  As I have said in para 54 above, I accept that.  Secondly, mere delay, without more, is insufficient to disqualify a patentee from making an amendment that would otherwise be considered appropriate.  At the theoretical level, this proposition must also be accepted.  Thirdly, the clock would not commence to run against a patentee unless he or she knew that, absent an amendment, the claim or claims in question would be invalid.  Only in such a case could it ever be said that the patentee knew of the need to amend.  To the extent that this proposition finds support in the cases at all, it is, in my view, rather tendentiously put by the applicants, and I shall have to return to it.  And fourthly, at no time until they received the Preliminary Opinion of the Opposition Division in Europe did the applicants come under an obligation to take steps to amend.  It is implicit in this proposition that the quality of the applicants’ appreciation of the need to amend was not, until then, such as would count against them in the exercise of the court’s discretion under s 105.  So understood, the proposition is also problematic, for reasons to which I shall also turn below. 

59                                          Dealing first with the applicants’ third proposition, it is convenient to commence with Smith Kline.  Aldous J referred to the “need to amend” in his fourth principle, but his Lordship was there referring to the quality of the patentee’s actual or constructive knowledge at the time when he or she threatened an infringer with the unamended patent.  It is the third principle which is concerned with delay as such, and there his Lordship proposed that a patentee who had delayed for an unreasonable period would not be allowed to amend unless he or she brought forward reasonable grounds to explain the delay.  (The textual circularity of this formulation need not detain us on this occasion.)  In such a context, an example of reasonable grounds was said to be where the patentee believed that an amendment was not necessary, and had reasonable grounds for that belief.  There is no support here for the proposition that delay will never be disqualifying unless and until the patentee is actually (ie – as proposed by the applicants – not merely constructively) aware that the unamended claims are invalid. 

60                                          The applicants derived strongest support for their third proposition from the judgment of Stevens J in Ward v Genesis Equipment and Manufacturing Inc (2009) 82 IPR 168.  His Honour said (at 180 [62]):

Counsel for the respondents contended that the delay should be assessed from the point where the patentee or his agent reasonably ought to have appreciated that prior art caused a problem to validity. But the authorities make it clear that the existence of a possible issue, or even a potential problem, is not sufficient. What is required is the formation by a competent professional of a view that the patent is invalid, coupled with a deliberate decision to hide that fact and/or fail to act. In other words, there must be both knowledge and deliberate action, or inaction. Further, delay does not start to run even where the patentee knows about the prior art in question but believes on reasonable grounds that the patent is valid.

It appears from context that Stevens J was here dealing with “covetousness and over‑reaching”.  To the extent that his Honour was purporting to make a more general statement having application to proceedings involving amendments, I consider, with respect, that at least a deal of what he said is rather more categorical than is justified by the cases (at least the English and Australian ones).  As will appear, the better view is close to the converse of what his Honour said in the concluding sentence of this passage, namely, that time will start to run where the patentee knows of the relevant prior art and has no reasonable grounds to believe that the patent is valid.  As noted above, that view finds support in the third principle stated by Aldous J in Smith Kline. 

61                                          Another authority which provides some support for the applicants’ position is Bristol Myers Co v Manon Freres Ltd [1973] RPC 836.  There the relevant prior art had been known to the patentees since 1952, but their Vice‑President went on affidavit to say that they took the view that the invention was valid over that prior art, and had never been advised to the contrary.  It was only in 1968, in connection with the instant proceeding, that they took the advice of counsel on the subject, and were told that “the action would be easier to fight and the chances of success would be greater if they amended” ([1973] RPC at 855).  Referring to the prior art as “Testa”, Whitford J said (at 857):

The plaintiffs admit to having known about Testa for years.  They never thought Testa was fatal to the original claim; they are still of this opinion.  They still think the original claim can be defended against Testa, and they have never been advised to the contrary.  As I have already said, they were given advice by counsel in 1968 that their position in the litigation could be strengthened by amendment; and it was, to my mind, in 1968 for the first time that they were put into a position where they seriously had to consider the question of amendment; and at that time, or shortly thereafter, they came to the conclusion that it would right to apply. 

It has, of course, been said that, if a patentee knows of prior art fatal to his case and deliberately refuses to apply to amend over a long period, although he knows his claims must be invalid as they stand, he will as a matter of discretion be refused amendment, if applies.  This is plainly right in all circumstances where the patentee had been representing to the public that he has a valid claim when he knows his claim cannot be supported.  This case is not such a case as that.

His Lordship then referred to Van der Lely NV v Bamfords Ltd [1964] RPC 55 as an example of a case in which “the patentee thought and was advised that all his claims were valid, but it turned out that this advice was wrong”, and continued ([1973] RPC at 857):

As I have said, this is not a case like that at all.  Until the patentees were given advice in 1968 that their position could be strengthened by amendment, I cannot see that there was any good reason why they should or ought to have thought that they should apply to amend at all.

62                                          As is apparent from these passages, Bristol Myers could have been determined, and was determined, without reference to a principle as categorical as that for which the applicants contend in the present case.  At one extreme, it may be accepted that a patentee who knows that certain prior art will be fatal to validity, and who delays making application to amend without a reasonable explanation, will occupy a very weak position from which to seek a favourable exercise of the court’s discretion.  With respect, however, I cannot accept that that is the only circumstance in which an application to amend will be refused.  At the other extreme, it also seems clear that a patentee who has been professionally advised that his or her claims are valid, and has no reason to doubt that advice, will be given a sympathetic hearing upon an application to amend.  However, as the final passage set out above demonstrates, the decision in Bristol Myers turned not merely on the circumstance that the patentees had received no advice adverse to the validity of the patent, but, ultimately, upon Whitford J’s view that, until they were advised to amend, “there was [no] good reason why they should or ought to have thought that they should apply to amend at all”.  In my opinion, the critical question here is whether the putative patentee had a good reason to think it necessary to amend (and, of course, the nature and justification of his or her reaction to that reason) rather than the more narrow fact of whether that reason was provided by the existence of advice that the unamended patent was necessarily invalid. 

63                                          In subsequent cases, Bristol Myers has not been given the categorical reading contended for by the applicants here.  In Matbro v Michigan (Great Britain) Ltd [1973] RPC 823, Graham J referred to Bristol Myers and to Van der Lely, and continued ([1973] RPC at 834):

I think these cases do support what I have said above in regard to delay and detriment and also draw a clear distinction between instances where a patentee knows of prior art which he genuinely, and quite properly in the circumstances, thinks is irrelevant, and other instances where, though he learns of or has been warned of objections which are available against his patent as a result of prior art, yet he takes no steps to put his specification right by way of amendment, or still worse, knowingly persists in retaining it in the unamended and suspect form.  In the latter cases delay is culpable because potential defendants and the general public are entitled to plan their activities on the assumption that the patentee, though warned, has decided not to amend.  If the patentee, by his conduct, lulls the public into a false sense of security he cannot thereafter be allowed to change his mind and ask for amendment, or at any rate without adequate protection being granted to the public.

Here, it seems to me, the facts are such that the case falls into the first category where, though the patentees knew of the prior art in question for some time before they applied to amend, they never, in fact, thought, or ought to have thought, nor were they advised until shortly before the application, that amendment was prudent.

Particularly in his Lordship’s words appearing towards the end of this passage, the judgment of Graham J provides more obvious support for the position taken by the respondents than for that of the applicants in the present case. 

64                                          The authorities to which I have referred were amongst a number which Aldous J considered in Smith Kline.  With reference to the first of the two paragraphs which I have extracted above from Matbro (that ending with the words “granted to the public”), his Lordship said ([1989] 1 FSR at 568):

In that passage, the judge drew attention to the fact that there is a detriment to the general public by the maintenance in an unamended form of a patent which should be amended for a substantial period of time.  He also drew a distinction between two categories of delay with knowledge.  In the first category is a patentee who knows of the prior art and never thought or should have thought amendment was the right course.  The Bristol Myers case fell within that category.  In the second category is a patentee who becomes aware of an objection to a patent and takes no steps to amend.  In both categories the patentee has knowledge of the prior art which prompted the request for amendment and failed to apply to amend for a substantial period of time.  The difference between the two categories is the unreasonable conduct of the patentee, referred to as culpable by the judge, in not applying to amend when he knew or should have known that he should amend.  In both categories, the failure to amend earlier is contrary to the public interest, but in the second [sic] category the patentee’s conduct could be excused as he acted reasonably and therefore not acted in a way which was an abuse of the patent system.  Thus, in a case where a patentee who is aware of the facts and either decides not to amend or takes no action, but later changes his mind, the court will refuse to exercise its discretion in his favour unless there is a good and proper reason for his failure to seek amendment promptly. 

I think it fairly clear that, in the penultimate sentence of this extract, the words “second category” ought to have been a reference to the first category. 

65                                          Subject to that minor complication, in that extract, Aldous J identified a distinction between two classes of case, in each of which the patentee knew of the relevant prior art.  The first was where he or she “never thought or should have thought amendment was the right course”.  The second was where he or she “becomes aware of an objection to [the] patent”.  The difference lay, in his Lordship’s view, in the “unreasonable conduct of the patentee” in the second kind of case, “in not applying to amend when he knew or should have known that he should amend”.  When his Lordship referred, later in the passage, to the patentee being “aware of the facts”, he had in mind, in my respectful view, a patentee who was “aware of an objection” in the second class of case.  This part of his Lordship’s judgment gives further content to his third principle, at least in a situation in which it is necessary to make discriminations between different putative patentees, each of whom knew of the existence of the relevant prior art. 

66                                          It seems that the first occasion upon which this court found it convenient to refer to the Smith Kline principles was Rescare Ltd v Anaesthetic Supplies Pty Ltd (Federal Court of Australia, unreported, 4 March 1993).  In that case, Gummow J seems to have interpreted a passage in the judgment of Menzies J in Sly v United Development Corp Pty Ltd (1962) 106 CLR 633, 640-1 as suggesting that the conduct of the patentee was not relevant to an application to amend before the Deputy Commissioner under the Patents Act 1903 (Cth).  Gummow J said that Menzies J’s words “should not be taken at face value when dealing with the later legislation ” (at [16]).  His Honour continued (at [17]):

Lengthy delay in seeking amendment may be fatal because in the meantime the patentee has represented to the public that he has a valid claim when he knows it cannot be supported in its present form:  Smith Kline and French Laboratories Ltd v Evans Medical Ltd (1989) FSR 561 at 567, a case arising under s 31 of the 1949 British Act. 

I would not read these words as proposing that lengthy delay would be fatal only where the patentee knows that the relevant claim cannot be supported in its unamended form.  Rather, what his Honour intended, in my respectful view, it is to give an instance of when lengthy delay would be fatal.  That instance was not intended to be exhaustive. 

67                                          The next occasion upon which this court referred to Smith Kline was Wimmera Industrial Minerals Pty Ltd v RGC Mineral Sands Ltd [1997] FCA 1063.  There is nothing in the judgment of Sundberg J in that case which provides any support for the categorical position for which the applicants contend.  To the contrary, his Honour was at pains to emphasise that a decision under s 105 is a discretionary one, that the principles in Smith Kline are not inflexible rules, and that, generally, there are no absolutes in this area of the law.  Much the same approach was taken by Tamberlin J in Gambro Pty Ltd v Fresenius Medical Care South East Asia Pty Ltd (1999) 48 IPR 625. 

68                                          The case which aligns most closely with the present one on the facts is ICI Chemicals & Polymers Ltd v Lubrizol Corp [1999] FCA 1417, decided in October 1999 by Emmett J.  There, objections had been taken to the corresponding claim in foreign jurisdictions, and those objections had been dealt with by processes which included amendments.  Yet no amendment had been sought in Australia.  Indeed, Emmett J was able to find that the patentee was most probably consciously aware that the relevant claim in the Australian patent had been anticipated by the prior art relied on in those overseas jurisdictions.  His Honour said ([1999] FCA 1417 at [128]-[130]):

With the benefit of hindsight, it may well be that some criticism can be directed to the conduct of Lubrizol over the period of time covered by the events that I have summarised above.  From the time when the amendment was foreshadowed in the US, or from the time when the European application was amended or from the time when the voluntary amendment was lodged in Canada, Lubrizol must be taken to have a conscious awareness of the invalidity of the Patent in so far as it included Claim 1 and its dependent Claims.  Nevertheless, it took no steps to amend in Australia.

However, I am not satisfied by the evidence before me that Lubrizol has endeavoured to obtain any unfair advantage by its failure to apply earlier for any amendment to the Patent and the complete Specification.  There is certainly no evidence that any entity has declined to use the relevant lubricants in combination with HCFCs by reason of the presence in the Patent of Claim 1 and its dependent Claims.  More significantly, there is no evidence to suggest that Lubrizol was motivated, in its failure to seek amendment earlier, by any desire to prevent such use.  In any event, I do not consider that the conduct of Lubrizol in relation to the claims relating to HCFCs is such as to disentitle it to the benefit of the invention concerning HFCs.

There was clearly delay on the part of Lubrizol.  However, the delay in question has not in my opinion been such that it should be characterised as unreasonable. While, in practical terms, the amendments could have been sought earlier, there was no intention on the part of Lubrizol to gain from any delay.  The tactics adopted once the proceeding for revocation had been commenced were legitimate.  Accordingly, I am not satisfied that, in the exercise of the Court’s discretion, I should refuse to direct the amendments sought by Lubrizol. 

The approach of Emmett J in ICI Chemicals provides a deal of support for the applicants’ position in the present case.  There are, however, important differences, in the light of which the applicants’ position should be seen as less defensible than that occupied by the patentee before his Honour. 

69                                          The forensic setting in which ICI Chemicals arose was that the applicant, the ICI company, took the initiative by commencing a proceeding for revocation.  About four months later, the patentee, Lubrizol, commenced a separate proceeding against other companies, alleging infringements of claims which included claim 1 ([1999] FCA 1417 at [71] and [84]).  At the time, the patentee took the view that claim 1 was invalid, but proposed to seek an amendment ([1999] FCA 1417 at [84]).  Emmett J said (at [85]):

Thus, at this stage, it is clear that, on the face of it, Lubrizol was alleging infringement of Claim 1 in the wide form in which it appears in the Specification as filed.  On the other hand, it is also clear that Lubrizol was not intending to rely on Claim 1 in its wider form but was intending to amend Claim 1 by incorporation into it of the qualification contained in Claim 2.  In other words, it is clear enough that Lubrizol intended only to enforce Claim 2 in the proceedings that it commenced on 15 July 1997.

About a month later again, the respondents in the infringement proceeding filed their defence and cross‑claim, alleging invalidity and seeking revocation ([1999] FCA 1417 at [88]).

70                                          Over the course of the next six weeks or so, the patentee considered whether it ought to apply to amend claim 1, the result of which was stated by Emmet J as follows ([1999] FCA 1417 at [95]):

Thus, a tactical decision was made by Lubrizol to defer, for the time being, any application to amend Claim 1.  However, it is clear that there was no intention to persist in any allegation of infringement of Claim 1 in its broader form.  The tactical decision was made in order to avoid disclosure of privileged material.  That appears to me to be a legitimate justification for the conduct of Lubrizol at that stage.

The deferral referred to by his Honour continued for about another year, during which the patentee was considering the legal and tactical issues that would be thrown up by an application to amend claim 1.  By October 1998, the patentee had arrived at a seemingly firm view that that claim could not be defended.  In that month its solicitors wrote to the solicitors for ICI stating that it would not be submitted that the claim was valid, and proposing two alternatives, each of which would have involved the revocation of the claim ([1999] FCA 1417 at [109]). 

71                                          The revocation proceeding and the infringement proceeding came before Emmett J in February 1999, his Honour giving judgment on 31 March 1999.  The patentee conceded that it could not maintain claim 1 and its dependent claims (claims 4-9) ([1999] FCA 345 at [39]).  The case proceeded by reference to the other claims, which his Honour held to be valid save with respect to fair basis.  The way his Honour decided the case was to hold that, if amended to overcome the fair basis point, certain of the claims would have been infringed.  It was these amendments which came before his Honour in the hearing which led to the judgment on which the applicants rely in the present case.  At least by that stage, there was no suggestion that claim 1 and its dependent claims ought to be amended.  They had been abandoned before the main trial in the case.  The patentee’s early awareness of the probable invalidity of claim 1 was, however, a discretionary basis upon which it was put to Emmett J that the amendments to the other claims should not be allowed.  His Honour dealt with the point in the terms I have extracted at para 68 above. 

72                                          The critical difference between ICI Chemicals and the present case is that, here, the applicants seek to amend the very claims as to which, it is said, they were earlier on fairly clear notice of validity problems which ought then to have been addressed.  By contrast, in ICI Chemicals the amendment application did not relate to the claims which the patentee earlier knew, or ought to have known, were invalid.  The delay point operated only indirectly with reference to the claims sought to be amended.  The significance of this to the exercise of Emmett J’s discretion is to be seen in the final sentence of the second paragraph extracted at para 68 above.  In the circumstances, I am not disposed to view ICI Chemicals as an authority in support of the applicants’ position in the present case. 

73                                          Moving to 2004, in Novartis Merkel J said ((2004) 62 IPR at 106 [133]):

However, amendment has been refused in cases of “culpable delay”. This can arise where “the delay was a deliberate ploy designed to gain some illicit advantage”: Wimmera at 39,792; see also Bentley at 377. Also, if the patentee knew of the need for an amendment but failed to apply for it for a long period, amendment may be denied because “in the meantime the patentee has represented to the public that he has a valid claim when he knows it cannot be supported in its present form”: Rescare at 10–11: see also Smith Kline & French at 567 and Bristol Myers at 857. The policy underlying the above observations is that “it is in the public interest that patentees should not delay in seeking to amend and that amendment will not be permitted in cases where a patentee knows or ought to know that amendment should be sought and fails to do so for any substantial period of time”: Smith Kline & French at 567.

This was, perhaps, no more than a summary of the jurisprudence as disclosed by the earlier authorities, but it is noteworthy that his Honour decided the point arising under s 105 by reference to a mix of factors which included when the patentee ought to have known that the amendments should be made: see 62 IPR at 112 [162]. 

74                                          Most recently, in Apotex Pty Ltd v Les Laboratoires Servier (2009) 83 IPR 42, Bennett J accepted the following as a convenient summary of some of the matters that had been considered relevant when questions of delay arose (83 IPR at 57 [88]):

·         Mere delay does not warrant refusal although the patentee must explain any delay, which should be reasonable.

·         If a patentee becomes aware of the undue breadth of its claims, it must act to amend them without undue delay.

There is no support here for the categorical terms in which the applicants proposed that the matter of delay should be approached. 

75                                          I have, with respect, found the passage from Smith Kline set out at para 64 most helpful in identifying the underlying principle which should inform the court’s thinking on the matter of delay.  Clearly “mere delay” is not disqualifying, and neither is delay accompanied by knowledge of the relevant prior art.  But when the circumstances are such that the patentee not only knows of the prior art but has been exposed to the view that the prior art would, or might well, be fatal to the validity of the claims in question, the onus, as it were, effectively shifts to him or her (the patentee) to bring forward a reasonable explanation why inaction was preferred to amendment at that stage.  The patentee is, of course, under no obligation to accept the view to which he or she is exposed, but if the view comes from a credible source the patentee will be best placed later to justify his or her inaction by evidence of serious attention having been given to the matter, ideally in the form of professional advice. 

76                                          I consider that to restrict the circumstances in which an application to amend might be successfully resisted to those in which it was common ground, or had been established, that the unamended patent was invalid, and the applicant knew of it, would be to take a position which is altogether too categorical, and one for which there is no support in the decided cases.  It must be allowed that there may be situations in which some lesser degree of a need to amend, and an applicant’s actual or constructive knowledge of it, should be recognised as sufficient, with other circumstances, to disentitle the applicant to the favourable exercise of the court’s discretion.  A patentee who has been exposed to facts from which it was, or reasonably ought to have been, apparent to him or her that a claim might well be invalid unless amended, and who later seeks the favourable exercise of the court’s discretion under s 105 is, in my opinion, in no position to say that there was, on the earlier occasion, no “need” to amend simply because it had not then been conclusively established that the claim was in fact invalid.  All will depend, in my view, upon the extent and quality of the applicant’s appreciation (actual or constructive) of the circumstances from which a need to amend is said to arise, and from the nature of those circumstances themselves. 

77                                          That leads me to the fourth of the applicants’ propositions mentioned in para 58 above, and specifically to the nature of the applicants’ response or responses to the challenges which had been made, in foreign jurisdictions, to claims which corresponded to the present claim 1.

78                                          Save for some formal and chronological material, the applicants filed no affidavit evidence with respect to the difficulties which they encountered having the corresponding patents registered in the United States, Russia or Canada (or, initially, Europe).  Such evidence as there was of those events was by way of the tender (by the applicants) of documents which they had provided to the respondents on discovery, and by way of the respondents’ cross‑examination of Messrs Turvey and Cox.  From the nature of that evidence – and perhaps more so from its limitations – I would infer that neither the applicants, nor DCC on their behalf, obtained legal advice as to the validity of the Australian claims 1 and 7 in the light of the examiners’ objections in those three jurisdictions.  Indeed, there is no evidence of such advice having been sought as to the legitimacy of those objections in the jurisdictions to which they respectively related.  As against that circumstance, the objective facts are that, in each case, an amendment was sought.  These facts provide a deal of support for the respondents’ case that, at each relevant time, the applicants well appreciated that, in order to avoid the prior art, it was necessary to amend the patent applications concerned; and therefore, and correspondingly, it was necessary to amend the existing patent in suit.

79                                          The applicants’ answer to this is best encapsulated in the following evidence given by Mr Turvey (while under cross‑examination):

There is no practice … that I’m aware of, nor have I ever received advice from my attorneys anywhere in the world[,] that once a particular amendment is made to a patent in any particular jurisdiction … there is some benefit or gain to be had in reviewing the entire portfolio with that in mind and certainly, we have never done that.

The difficulty with this approach is that it was not merely that an amendment was made in a particular jurisdiction: it was that examiners in multiple jurisdictions expressed the view that claim 1 should not be granted because of what was substantially the same prior art in each case.  Whether it was lack of novelty or want of an inventive step, the applicants were squarely on notice that claim 1 was problematic, and the significance of that circumstance is not depreciated by the view of things expressed by Mr Turvey.  It is here that the absence of any evidence of professional advice contrary to the opinions expressed by the examiners counts particularly against the applicants.  Those opinions, in my view, imposed upon the applicants at least the obligation to obtain such advice in relation to the patent in suit, if they are now to be heard to say that nothing that occurred in the early years made it necessary for them to amend. 

80                                          Mr Turvey also agreed with a proposition which I put to him that, if the dog were sleeping, one would not kick it, adding:

But that almost suggests that there’s a conscious effort not to do that.  There was no conscious effort to do anything.  Once patents go to grant, they go to grant and unless there’s a good reason to change them, you don’t.

When I suggested to Mr Turvey that the question of an amendment “just wasn’t on your radar”, he responded, “it certainly wasn’t”.  He was speaking here, of course, of the period which preceded the European post‑grant opposition proceedings (as I am in this part of my reasons).  Even so, the cases seem to establish the proposition that circumstances known to the patentee, which give rise to an apparently legitimate concern as to validity of a claim, ought to be on his or her radar if he or she later moves to amend.  I do not consider it to be a satisfactory response to assert that, because the patent stood on the register, the patentee did not need to take the initiative.  To the contrary: the cases establish that the patentee, as the person who will have access to all the relevant information, should not wait until a challenge is made by a third party in whatever form of proceedings may be appropriate in a particular jurisdiction.  Although it will always be a matter for judgment, on any view there may be a time, while the patent remains in the register free of any challenge, when the extent and quality of the patentee’s knowledge will be such as to call upon him or her to take the initiative and apply to amend. 

81                                          From at least 2001, the applicants had been aware of the significance of D1 and D2 to the validity of the patent in suit.  They invite me to accept that they reasonably took the view that these citations were not fatal, but, as noted above, it appears that they had never received professional advice to that effect.  As against this, in the United States and in Russia, the applicants proposed a particular amendment to claim 1 which appears to bespeak a real concern about anticipation.  The same amendment was proposed in the European application, although, as I have noted, that was not carried through into the patent as granted (for reasons of which there is no evidence).  To the extent that the applicants invite me to hold that they came under no obligation, as a result of these events, to consider applying to amend the patent in suit, I would be disposed to reject that invitation.  I would not hold that the applicants must necessarily then have amended, but there is no evidence that they even gave consideration to the matter.  That was not, in my view, a reasonable response on the part of the beneficiaries of a statutory monopoly.  As it happens, however, I am not called upon to determine what course might reasonably have been adopted by the applicants in 2001, in 2003 (when the US patent was granted) or at any time before the filing of the second respondent’s opposition in Europe in June 2007.

82                                          That opposition put in train a series of events in which the applicants were obliged to give, and did give, attention to the defence of the European claim 1 in the light of D1 and D2.  The way that Mr Cox and Mr Sheard handled the applicants’ response to the opposition was, in my view, timely, conscientious and responsible.  It led to the making of the first auxiliary request, in which a pH range was introduced into the claim.  If the applicants did not previously have mapped out for them a specific expedient to protect the relevant claims in the patent in suit from the potential of a challenge from D1 and D2, they had one then.  It is also significant, in my view, that the applicants chose to make no submission in support of their main request.  That circumstance tends to reinforce the conclusion – which I would in any event be disposed to reach on the evidence – that the applicants were in possession of no professional advice to the effect that claim 1 could withstand such a challenge.

83                                          Having filed their first auxiliary request in the European opposition proceedings in April 2008, the applicants made the very same application to amend in Canada in June of that year.  That application was, of course, in response to the same prior art as the second respondent had used against the applicants in Europe.  Yet still, on the evidence before me, the applicants sought no professional advice as to the validity of claim 1 of the patent in suit, nor as to the ramifications for that claim of what was occurring in Canada and Europe. 

84                                          But the sequence of events with which I must presently be concerned does not end there.  Not long after the events referred to in the previous paragraph, the applicants were given cause to believe that the respondents may be infringing the patent in suit.  They engaged solicitors, and briefed them on the issues that were relevant to infringement, but still no advice was sought as to the risk to validity posed by D1 and D2, nor as to the advisability of an amendment.  At his telephone conference with Mr Pascarl in November 2008, Mr Turvey (in response to Mr Pascarl) suggested that amendment should be high on the agenda, but there is no suggestion that he linked this to the events in Europe or Canada, or informed Mr Pascarl of the fact that the applicants had, in effect, a ready‑made amendment which they had found convenient to use in those jurisdictions.

85                                          Given the history to which I have referred, I consider that the applicants delayed unreasonably before moving to amend the patent in suit in November 2009.  Clearly they were in a position to apply to amend when they received Mr Sheard’s draft European amendments in April 2008.  Their reasons for not doing so, either then or for more than 18 months thereafter, is that they were reasonably entitled to await the outcome of their two European requests.  This is, of course, a justification now advanced by the applicants for their inaction.  There is no (at least documentary) evidence that this reflected the applicants’ actual thinking at the time.  There is no evidence, for example, that the applicants sought or took professional advice on the timing of any amendment application in Australia, nor upon the relevance of the course followed in Europe to that question. 

86                                          However that may be, I am in any event not persuaded that the desirability of knowing what the Opposition Division thought both of the validity of the unamended claims, and also of the potential of the amended claims to meet the challenge presented by the prior art, is a sufficient discretionary ground to justify, for the purposes of s 105, the applicants’ inaction over the period to which I have referred.  The suggestion that it was reasonable to await the Opposition Division’s opinion on the validity of claim 1 in its unamended form is, in my view, belied by the choice which the applicants made not to offer any submissions on that subject.  Particularly having regard to their earlier experience in the other jurisdictions in which D1 and/or D2 had been cited against them, they could not realistically have anticipated that, without any submissions in support, the validity of claim 1 in its unamended form would be upheld in the Preliminary Opinion.  Indeed, Mr Sheard’s proposal that the main request would be retained “simply to give flexibility in the event of an appeal” strongly bespeaks an anticipation that the Preliminary Opinion would be adverse in relevant respects.  Neither do I consider it reasonable for the applicants to have held back from moving for any amendment in Australia until they received, in effect, a quote from the Opposition Division as to the sufficiency of the proposed pH amendment to meet that challenge.  The applicants were (and are) under no obligation to amend the patent in suit, but, as Aldous J said, if they were going to amend, they ought to have done so “promptly”.  The gravity with which they clearly viewed the circumstances in Europe, and the attention they gave to the terms of an amendment, made it unreasonable, in my view, for them not then to have applied in Australia, whether or not they had received the Preliminary Opinion of the Opposition Division. 

87                                          However, I am not required to decide the present motion even by reference to the circumstances and considerations to which I have referred so far.  That is because the applicants did not merely await the Preliminary Opinion of the Opposition Division: on 10 March 2009 they commenced the present proceeding, in which they alleged that the respondents had infringed the unamended patent.  That was, in my view, to take unfair advantage of the patent within the meaning of the fourth principle of Aldous J.  The applicants, even then, might have accompanied their proceeding with an application under s 105.  They took no such course.  They were content for the present proceeding to be determined by reference to a claim which they had found it necessary to amend elsewhere, and for which they offered no real defence in the European Opposition  proceedings less than 12 months previously.  And there is no suggestion in the evidence that the applicants sought professional advice on the appropriateness of the course which they then followed. 

88                                          Considering the history of the applicants’ experiences with the patents, and patent applications, which flowed from the original PCT application in 1997 – not as a collection of isolated events, but as a continuum against which the applicants’ actual or constructive knowledge of the need for an amendment might be inferred – I am of the view that November 2009 was too late to make the present application to amend, particularly having regard to the applicants’ choice to sue on the unamended patent in March 2009.  I say “too late”, of course, not to imply a view that the conduct of the applicants was reprehensible, but merely in the sense that the history of inaction to which I have referred places the applicants in no position to seek the favourable exercise of the court’s discretion under s 105.  Having chosen not to amend for so long, having omitted to obtain professional advice on the appropriateness of amending, and having decided to sue on the unamended patent, the applicants should, in my view, be obliged to prosecute the present proceeding against the terms of the relevant claims as they stand. 

89                                          There are only two circumstances which have caused me to pause before reaching this conclusion.  The first has already been mentioned: the fact that it has not yet been established – and it may never be established – that the claims in question are invalid against the prior art relied on by the respondents.  Having a registered patent in Australia, why need the applicants have amended here just because examiners in some other jurisdictions took a particular view based on the prior art?  The answer to this question, in my view, is that the examiners’ views are significant not merely because they constituted hurdles which the applicants had to surmount in the jurisdictions concerned.  They are significant because they provided the occasion – several occasions, as it happened – for the applicants to have been required to give attention to prior art citations which were obviously relevant also to the validity of the patent in suit.  The focus with which the problem ought reasonably to have presented in the applicants’ eyes was sharpened by the filing of, and by the applicants’ response to, the second respondent’s opposition to the European patent.  It is no answer to the proposition so clearly implied by these events to say that, because the patent in suit was on the register, it did not need to be amended.  If anything, the contrary.

90                                          The second circumstance is that the respondents make no claim to have been prejudiced by the applicants’ omission to make their present application in a more timely way.  In a number of cases, the absence of prejudice has been mentioned as a circumstance favouring the making of an amendment, and I accept that it should be so regarded.  The cases have, however, referred also to the public interest.  I have mentioned elsewhere that the patent in suit gave the applicants an ostensible statutory monopoly.  To the applicants’ actual or constructive knowledge, serious and apparently legitimate issues had been raised elsewhere which had the potential to undermine the validity of the relevant claims in the patent.  It was, in my view, strongly in the public interest that those issues be confronted in the Australian context.  It was not in the public interest that they be ignored, and that proceedings be commenced on the silent premise that they did not exist.  I do not consider that the absence of prejudice on the part of the respondents is any sufficient counterweight to the public interest considerations to which I have referred. 

91                                          For the foregoing reasons, I propose to grant the applicants’ motion to the extent only that it relates to the amendment to correct the typographical error to which I referred in para 2 above.  Otherwise, I shall refuse the motion.  I shall hear the parties on the question of costs.

Associate:

Dated:         18 November 2010