Federal Court of Australia

Fanca Technologies Pty Ltd v CFH Airtechnic Australia Pty Ltd [2025] FCA 953

ORDERS

THE COURT ORDERS THAT:

1.    The applicants have leave to amend their amended originating application filed 9 February 2024, in the form annexed to the applicants’ letter to the respondents dated 18 October 2024.

2.    The applicants have leave to amend their amended statement of claim filed 9 February 2024, in the form dated 11 December 2024, save in respect of proposed particular (ii) to §23.

3.    The applicants are to pay the respondents’ costs thrown away, if any, in respect of the amended pleadings referred to in orders 1 and 2 above.

4.    Costs otherwise be costs in the cause.

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

REASONS FOR JUDGMENT

PERRAM J:

Introduction

1    By application dated 28 March 2025, the applicants seek leave to file an amended originating application and an amended statement of claim. The respondents consent to the filing of the amended originating application and various amendments to the amended statement of claim, but they object to:

(1)    particular (i)(1)(C) of §11;

(2)    amendments to §§15 and 17;

(3)    particulars (ii)-(iv) to §22; and

(4)    the particulars to §23.

2    This proceeding concerns the applicants’ claims for patent infringement. The patent is owned by the first applicant and the second applicant is its exclusive licensee. It is alleged to give them rights of monopoly over a dust removing machine with a fan assembly together mounted on a single frame to which is attached a drive mechanism on either tracks or wheels. The parties refer to this configuration as the ‘impugned product’. The patent involves both product and method claims.

3    The respondents are a group of companies which between them are alleged to be carrying on the business of manufacturing and/or supplying large machines which remove dust. These machines are sold to Australian customers who use them in tunnelling operations.

4    Two of the respondents’ machines have been found in tunnelling operations in Sydney. The first is at Stage 1 of the M6 project at Arncliffe and the second at the Five Dock site of the Sydney Metro West Project.

5    The machines are modular and can be configured to meet the specifications of the projects for which they are purchased. For example, these machines may be fitted with a fan assembly on a single frame or on a separate frame, and with a drive mechanism, including on skids, tracks or wheels.

6    There are two possibilities for how any impugned product may come into the possession of a customer. The first is that the respondents supplied the dust removing machines in the configuration of an impugned product. The second is that the respondents only provided the dust removing machine and that the respondents’ customer then assembled the impugned product by fitting that machine with a fan assembly on a single frame and a drive mechanism on tracks or wheels.

7    The applicants do not know which of these is factually the case in respect of each potentially infringing machine since the fact that the machines are mounted with a fan assembly on a single frame and fitted with a drive mechanism does not tell one who assembled them. However, it is clear that if the machines at Arncliffe and Five Dock were not assembled by the respondents then they were assembled by the customer or by persons acting on behalf of the customer. The correctness of this dichotomy was accepted by the respondents during oral submissions.

8    The applicants have therefore pleaded two classes of patent infringement cases in respect of all respondents. In the first class, which only has one member, they allege that the respondents directly infringed the patent by supplying the impugned products. In the proposed pleading the direct infringement case appears at §§11, 12, 13, 14 and 16.

9    In the second class of cases, there are three members. Unlike the direct infringement cases, in each of these cases it was the customer who assembled the impugned product after purchasing the dust removing machine by fitting the machine with the necessary components (i.e. the fan assembly, single frame and drive mechanism). The three cases in this class are:

(1)    a case that the respondents ‘authorised’ their Australian customers to assemble and use the machines with a fan assembly, single frame and drive mechanism. The right to authorise a person to exploit an invention the subject of a patent is included in the monopoly by s 13 of the Patents Act 1990 (Cth) (‘the Act’). Hence, the act of authorising another to infringe a patent is itself an infringement of the patent. This case appears at §§15 and 16;

(2)    a case that the respondents are joint tortfeasors with their Australian customers on the basis that they are party to a common design to infringe the applicants’ patent claims. This case appears at §§17 and 18; and

(3)    a case that the respondents have infringed the patent by supplying their machines to Australian customers whose use of the machines with a fan assembly, single frame and drive mechanism constitutes a ‘use’ under the, not entirely straightforward, s 117 of the Act. This case appears at §§19 to 24 where a separate case for each of ss 117(2)(a), (b) and (c) is advanced.

10    The respondents submitted that the amendments proposed by the applicants to these three cases would be liable to be struck out if leave to amend were granted and, on that basis, they submitted that leave should not be granted.

11    Each of the indirect infringement claims is pleaded as being a case ‘further or in the alternative’. Thus, each indirect infringement claim is pleaded as an alternative to the direct infringement claim and each other. The ‘further’ claim relates to the possibility that one of the impugned products was assembled by the customer and another supplied in an infringing form by the respondents.

Consideration

Challenge to authorisation case

12    By reference to the proposed amendments to §15, the respondents make two submissions on the applicant’s authorisation case. I reject both submissions.

13    First, the respondents submitted that the applicants failed to plead a primary infringement of the patent on the basis that they do not identify any instances of an Australian customer purchasing one of the respondents’ dust removing machines and then fitting that machine on a single frame with a fan assembly and a drive mechanism. In other words, the authorisation case should fail because the applicants have not particularised an instance of a customer assembling an impugned product. However, because the authorisation case is in the alternative to the applicants’ direct infringement case, the only entity who could have assembled the machines in an infringing way is the customer. As I note above, that either the respondents or their customers would have assembled the impugned products (or an agent of either) was accepted by the respondents at the hearing. Thus if the primary infringement case has failed because the respondents did not supply their machines fitted with a fan assembly on a single frame and a drive mechanism then it is inevitable that the customer did. In the alternative case the primary infringement is therefore pleaded with sufficient clarity.

14    Secondly, the respondents submitted that the applicants have pleaded no authorising conduct beyond the mere supply of their dust removing machines. The parties’ dispute on this point crystallised in discussing the particulars to §22, to which particular (ii) of §15 refers. The particulars to §22 include the manuals admitted as Exhibits 1 and 2. Exhibit 1 is a manual by the third respondent intended to assist in the ‘assembly, start-up and shut-down, operation, servicing and maintenance, disassembly and disposal’ of a dust removing machine with various components called the ‘Dust collection system type HTKK 1/1500-2S’. Exhibit 2 is a manual by the first respondent intend to provide ‘information and instructions’ for the operation of a ‘deduster track system’.

15    In my view, these exhibits make it a triable issue whether the respondents provide their dust removing machines in a way which allows the customer to fit them with accessories including fan systems, frames and tracks and be used in an allegedly infringing manner. Both manuals pertain to specific components (a dust removing machine and a track system) but include instructions for use and depictions of the impugned products. In addition, Exhibit 1 states that various components of the impugned products are ‘optional’ (including, importantly, the fan and track system) and Exhibit 2 seems to depict an impugned product utilising tracks manufactured by a third party expressly named in the respondents’ manual.

16    I am also unpersuaded by the respondents’ submissions in response. Most importantly, the respondents submitted that, even if it were accepted that the manuals show the respondents’ products are modular in some respects (for example, that some machines can be supplied on skids, tracks or wheels) and that some components of the impugned products are sold separately (for example, the fans), that is a far cry from showing that the machines are supplied as a ‘kit of parts’ that can be put together by a customer using a ‘LEGO-type approach’. This submission has some force, but it is difficult to reconcile with the respondents’ acceptance that the impugned products were either assembled by the respondents or by their Australian customers. This submission also does not foreclose the inferences available from the manuals and, at the pleadings stage, all inferences must be drawn in the applicants’ favour.

17    The same is true of the respondents’ submissions specific to Exhibits 1 and 2. As to Exhibit 1, the respondents submitted that this manual was not relevant. But the respondents made no relevance objection at the hearing and, in any event, the manual seems to offer detailed diagrams of the respondents’ products and some guidance on their assembly.

18    As to Exhibit 2, the respondents submitted that it was only given to Australian customers who bought a dust removing machine with tracks and that it did not include instructions explaining how to add tracks to such a machine. At the hearing, the respondents further submitted that the Court should construe the manual’s reference to a manufacturer of tracks not a party to this litigation as merely indicative of the fact that that manufacturer provides tracks to the respondents and that those tracks are an integer in the track system the subject of the manual. But, as the respondents acknowledge, there is no evidence of the respondents’ commercial relationship with that manufacturer beyond the manual’s reference to them and the reference supports the applicants’ point that the tracks at issue in the manual seem to be manufactured by a third party. The respondents also submitted that, given the specialist nature of the impugned products, it is counter-intuitive to think that their Australian customers would be assembling such products from individual parts. But again this submission is untethered from any evidence. I am prepared to infer from this and the other evidence before the Court that, for the purposes of the applicants’ proposed pleading, a customer may be able to purchase the respondents’ machines and assemble them with tracks manufactured by a third-party provider, especially in circumstances where the assembly of the impugned products by a customer is part of the applicants’ alternative cases.

19    For these reasons, I reject the respondents’ submissions. It may be that these manuals will be shown not to support the applicants’ claims, but I am satisfied that they are sufficient at a pleading level to permit the authorisation case to proceed.

Challenge to joint tortfeasor case

20    The same challenges are made to the joint tortfeasor case at §17 by the respondents and I reject them for the same reasons.

Challenges to the s 117 cases

21    At this point, it is convenient to note that, by using the term ‘Section 117 Products’ as defined at §19(a)-(d), the s 117 cases apply to four distinct products: (a) the dust removing machines alone, (b) a dust removing machine fitted with a fan assembly, (c) a dust removing machine fitted with a fan assembly on a single track, and (d) the impugned products (i.e. the dust removing machine fitted with a fan assembly on a single frame to which is attached a drive mechanism on wheels or tracks).

22    The respondents submitted that the s 117 cases relating to the impugned products are redundant with the direct infringement case and so they should be disallowed on that basis. Because the s 117 cases are pleaded in the alternative to the direct infringement case, I reject that submission. The analysis that follows in this section thus only applies to the s 117 cases directed at the other three Section 117 Products summarised at (a), (b), and (c) of the above paragraph, i.e., the s 117 cases for indirect infringement.

23    I interpolate further that the respondents challenge only the s 117 cases pleaded under subsections 2(b) and 2(c). They do not challenge the case pleaded under s 117(2)(a), which appears primarily at §20.

The second s 117 case: s 117(2)(b)

24    The applicants plead the s 117(2)(b) case at §§21 and 22. There the applicants allege that the respondents had reason to believe that Australian customers would use their machines with a fan assembly on a single frame and with a drive mechanism on wheels or tracks in an infringing manner. The respondents challenge §22 on the basis that particulars (ii)-(iv) are non-tenable.

25    First, particular (ii) suggests that the respondents’ reason to believe that their Australian customers would use the machines in an infringing way may be inferred from requests for tender that the respondents have provided in discovery. The respondents contended in writing that no particular requests for tender were identified in the pleading. At the hearing, and as foreshadowed in their submissions, the applicants tendered three requests for tender issued by various customers responsible for the construction of tunnels and the Court accepted them as Exhibits 6, 7 and 8. I note the following:

(1)    Exhibit 6 is a request for tender to supply 11 ‘Dust Scrubbers’ for use in various Metro stations around Sydney. This request for tender required a mobile, dust removing machine equipped with fans. Senior Counsel for the applicants submitted that this is the request for tender in respect of the project referred to at §10(ii)(B) of the proposed pleading.

(2)    Exhibit 7 is a request for tender to supply a ‘Dust Collector & Scrubber System’ for a suburban rail loop in Victoria. The request for tender states that the type of equipment would be mounted on a skid or on tracks for mobility. Senior Counsel for the applicants submitted that this request for tender included a reproduction of a scrubber from one of the respondents’ manuals.

(3)    Exhibit 8 is a request for tender of the ‘Supply of Air Scrubbers’ in connection with the M6 Stage 1 Motorway Project. This request for tender sought a mobile scrubber with fans. Senior Counsel for the applicants submitted that this was the request for tender in respect of the project referred to at §10(ii)(A) of the proposed pleading.

26    It may be inferred from these documents that these customers wished to have dust removing machines with fans and a drive mechanism. The position in relation to the single frame is less clear. However, standing back at the level of a pleading debate I am satisfied that there is a triable issue on whether it may be inferred from the requests for tender that the respondents would have had reason to believe that their machines would be purchased by a customer and then assembled together with other components in a way which infringed the patent.

27    At the hearing, the respondents submitted that there was no request for tender in evidence or particularised in the pleading that showed a customer interested in assembling a product different to what they requested. That may be accepted. But that is not what the applicants submitted. The applicants contended that the requests for tender together reflect multiple customers’ interest in using machines that share the configuration and characteristics of the impugned products and thus support an allegation that the respondents had reason to believe their products might be used in an infringing manner (and in the alternative case, assembled for such use).

28    I also reject the respondents’ allied submission that the pleading contravenes Federal Court Rules 2011 (Cth) (‘FCR’) r 16.43. Section 117 is concerned with an objectively determined state of affairs to which the rule does not apply. Even if FCR r 16.43 were to apply, I am not persuaded that the applicants would be required to further particularise why the respondents would have had reason to believe that their Australian customers would use their products in an infringing manner. As explained above, the language of the requests for tender is sufficient, drawing all inferences in favour of the applicants. Whether in fact the respondents had reason to believe their products would be used in an infringing manner is a matter for trial.

29    Secondly, particular (iii) was supported by the same manuals which I have accepted can support the applicants’ authorisation case. For the same reason, I accept they can support their case under s 117.

30    Thirdly, particular (iv) repeats the particulars to §6. These particulars refer to various websites including some operated by the respondents. Though these websites offer insight into the scope of the respondents’ product and service offerings in Australia and offer support for the submission that the respondents sell dust removing machines and fans separately, I am unable to extract from them the proposition that the respondents would, by reason of those matters, have reason to believe that its Australian customers would assemble and use the impugned products after purchasing the respondents’ pleaded Section 117 Products. I would therefore permit particular (iv) but only in respect of the s 117(2)(b) claim directed at the impugned products.

The third s 117 case: s 117(2)(c)

31    The applicants plead their s 117(2)(c) case at §23. The respondents submitted that the particulars to §23 cannot support the allegation that they instructed or otherwise induced Australian customers to use the Section 117 Products to infringe the patent. I reject that submission in respect of particular (i) but not (ii).

32    First, particular (i) to §23 repeats the particulars to the second s 117 case under s 117(2)(b) (i.e. the particulars to §22). For the reasons stated above, I would reach the same conclusions. Particulars (ii) and (iii) to §22 should be permitted. Particular (iv) to §22 should only be permitted in support of the s 117 claims against impugned products.

33    Secondly, particular (ii) to §23 cross-references particulars (i), (ii) and (iii) to §6. Consistent with the above analysis of these particulars, I do not see how the matters in these particulars can support §23 because they do not seem to induce or instruct the respondents’ would-be Australian customers to assemble an impugned product from parts sold by the respondents and those of other manufacturers, including the respondents’ fans or dust removing machines.

Challenge to the impugned products enumerated at §11

34    This paragraph sets out the products of the respondents which the applicants say infringe the patent. The particulars include the machine at Arncliffe (particular (i)(1)(A)) and the machine at Five Dock (particular (i)(1)(B)), both of which are alleged to meet the configuration for an impugned product. These are not controversial.

35    Particular (i)(1)(C) refers to a series of photographs of some of the respondents’ dust removing machines. Some of these meet the criteria for an impugned product. Others do not. That much was common ground between the parties.

36    Particular (i)(1)(C) states:

each of the DDTCFDs with a designation commencing with HTKK, HBKK or HTKS, or otherwise depicted in the photographs in Schedule 1 to this pleading from the publications in particulars (i), (ii), (iii), (iv), (vi) and (vii) to paragraph 6 above, with a fan assembly (both supported by the same frame) and drive mechanism (being either tracks or wheels). The Applicants cannot particularise locations of these products until after discovery and/or interrogatories.

37    My initial reading of the particular was that it means that only the machines in the photographs which infringe are intended to be particularised as impugned products alongside the Five Dock and Arncliffe machines. However, it became apparent during the hearing that the applicant relies on the photographs of the machines which do not infringe to define a class of potentially infringing products. This class includes any dust removing machine depicted in the photographs if they were fitted on a single frame with a fan assembly and a drive mechanism (being either tracks or wheels) – even though the photographs do not all depict machines configured in that manner. Hence the applicants submitted that as yet unidentified infringing products would form part of the class of impugned products. At the hearing, both parties confirmed that they understood this to be the intended meaning of the particular.

38    During argument, the applicants submitted that they sought to do this because they had been met with a contention from the respondents that on any quantum case the applicants would be limited to the specific products which they had shown to have infringed. Thus the amended pleading seeks to identify the class of respondents’ machines that can be configured in an infringing manner so that, if infringement is proved in respect of that machine, the applicants may seek damages for each. The true debate between the parties is therefore revealed as skirmish on a quantum case.

39    Subject to argument of course, an easy way through this conundrum would be to issue an interrogatory to the respondents requiring them to identify all dust removing machines they supply with a fan assembly on a single frame and a drive mechanism (being either tracks or wheels). They could also be asked whether they supplied the machines which are presently at Five Dock and Arncliffe. Having the answers to these questions would be useful in getting to the heart of what this case is actually about.

40    However, as the respondents submit, the present issue is whether the particular (i)(1)(C) should be struck out because it is ambiguous, contravenes FCR r 34.42 or refers to non-existent machines. I reject these submissions.

41    First, though the meaning of particular (i)(1)(C) was the subject dispute between the parties, the meaning contended for by the applicants is tolerably clear. The intended interpretation of the particular is that stated above at [37]. In light of the parties’ submissions and argument, I find that the particular is not open to inconsistent meanings and thus is not embarrassing within the meaning of FCR r 16.02(2)(d).

42    Secondly, since the particular does not concern merely ‘hypothetical’ configurations of the respondents’ machines, there is no reason to strike it out. Given the asymmetry in information between the parties, it is sufficient to sustain particular (1)(i)(C) at the pleadings stage on the basis that the applicants have identified a configuration of the dust removing machines which is said to infringe, pleaded two particular examples of that configuration, and relied on various additional materials to demonstrate that other products meeting that configuration (i.e. other impugned products) are sold.

43    Thirdly, FCR r 34.42(3)(b) does not require that I deny the applicants’ amendments in this instance. I accept the respondents’ submission that the particulars to §6 (to which particular (i)(1)(C) of §11 refers) do not identify a specific impugned product, as compared to particulars (i)(1)(A) and (B) of §11. Nevertheless, and for the reasons stated above, the amended statement of claim is sufficient to enable the respondents to understand the indirect infringement cases put by the applicants. I also assume without deciding that r 34.42(3)(b) applies to the patent at issue here. This does not mean, however, that particular (i)(1)(C) must be struck out: Vehicle Monitoring Systems Pty Ltd v SARB Management Group Pty Ltd (t/as Database Consultants Australia) [2020] FCA 6; 149 IPR 370 at [106] per Yates J. Rather, after completion of discovery, the applicants should be required to particularise each of the impugned products they allege to infringe the patent or persuade the Court that compliance with FCR r 34.42(3)(b) should not be required at that point in time. It is not necessary to express a further view on this provision now.

Result

44    I make the following orders:

(1)    The applicants have leave to amend their amended originating application filed 9 February 2024, in the form annexed to the applicants’ letter to the respondents dated 18 October 2024.

(2)    The applicants have leave to amend their amended statement of claim filed 9 February 2024, in the form dated 11 December 2024, save in respect of proposed particular (ii) to §23.

(3)    The applicants are to pay the respondents’ costs thrown away, if any, in respect of the amended pleadings referred to in orders 1 and 2 above.

(4)    Costs otherwise be costs in the cause.

Associate:

Dated:    15 August 2025