117 On one hand Mr Hamer stated that he did not intend his first affidavit to be the only mechanism by which Servier would provide full and frank disclosure of its reasons for seeking amendment of the AC Patent. He said that he expected that there would be an exchange of pleadings and further evidence, as well as the production of documents and discovery and the presentation of oral submissions to the Court. On the other hand, Servier maintains that Mr Hamer's first affidavit accurately states the reason for the amendments in general terms and that his second affidavit elaborates on each of the relevant factors. That is not the case. Servier accepts that inserting the additional claims would also serve to distinguish the AC Patent from the prior art and therefore overcome the invalidity risk. While there is no requirement for an officer of the patentee to give evidence, the onus is on the patentee to provide its reasons.
118 Servier did not disclose the reasons for seeking the amendments until the end of a long process. I do not accept Servier's suggestion that the disclosure of its reasons was part of an iterative process. A process of ongoing disclosure can be sufficient. In Gambro Pty Ltd v Fresenius Medical Care South East Asia Pty Ltd (1999) 48 IPR 625, documents relevant to an investigation of Gambro's motives were produced directly to the Court, rather than in discovery or affidavit evidence, and this was held to be sufficient disclosure. However, for its own reasons, Servier declined to disclose the reasons for the proposed amendments at the time of making its application until, in effect, compelled to do so.
119 The proposed amendments to the claims are not deletions of wider claims with the maintenance of narrower claims. Servier proposes to maintain the existing claims and to add a new set of claims with a purportedly narrowing element. From the information ultimately provided by Servier, the purpose of the proposed amendments seems to be to validate the claims in case none of the corresponding existing claims are valid or are infringed by Apotex.
120 Courts have traditionally refused amendment if it was considered that the patentee's conduct had been such that, as a matter of discretion, the amendment should be refused. Following a period of strictness, this rule was relaxed so that it was not applied adversely unless the patentee had deliberately elected to maintain invalid claims which he or she knew or ought to have known required amendment (Thorley et al, Terrell on the Law of Patents (16th ed, Sweet & Maxwell, 2006) at 9-37). Delay likely to be of some detriment to respondents or to the general public was also considered a factor, although mere delay was not (Terrell at 9-38).
121 There is no obligation on a patentee to disclose privileged documents, although there may be a need to do so to satisfy the obligation for full and frank disclosure. Failure to disclose documents in those circumstances may result in the exercise of discretion to refuse the amendments unless a reasonable explanation is given (Wimmera (No 2) at 115). The disclosure of privileged documents is not contingent on a request for discovery by the respondent (Re Hsiung's Patent [1992] RPC 497).
122 Servier commenced proceedings for infringement on the existing claims. It has moved with reasonable expedition to apply to amend the claims since the commencement of these proceedings. However, Servier says that the presence of the compound in the form of individual needles is part of the invention. Indeed, Servier's analysis of the AC Patent makes it apparent that it is a necessary part of the invention. Yet Servier does not seek to amend the AC Patent by deleting those claims that do not possess this limiting integer. It wishes to maintain both the broad, unlimited claims and the new proposed limited claims. That of itself is not unusual - it is the way in which independent and dependent claims are often drafted. Further, it is not impermissible for a patentee to amend to attempt to "catch" an infringer or to remove a lawful ground of objection. The latter is specifically provided for in s 104(1) of the Act, so long as the amendment is allowable under s 102. However, maintenance of the existing claims that are wider than the invention together with the proposed narrowing claims that define the described invention may give to Servier an unfair advantage. One of the considerations that has been discussed is whether the patentee has knowingly taken advantage of wide claims. The issue is not whether Servier commenced proceedings on the unamended claims. That itself would not disentitle Servier from obtaining a grant of the proposed new claims. However, Servier advances the proposed new claims as reflecting the invention. That is, the invention is the form of the compound in individual needles, yet Servier maintains the existing, wider claims which are not limited by that form. In other words, Servier intends knowingly to take advantage of the wider claims which do not reflect the invention described in the AC Patent, while at the same time seeking amendment better to defend the validity of the AC Patent and prove infringement by Apotex.
123 Servier is entitled to seek amendments to remove valid objections to validity, as it is to improve its prospects of establishing infringement. It is relevant, however, that after the comprehensive rejection of the corresponding unamended claims in the UK decisions, Servier still wishes to maintain those claims while at the same time seeking to overcome attacks on their validity by inserting the proposed new claims. As the same claims are maintained, the grounds of invalidity asserted in respect of those claims are not removed by the amendments.
124 The equivalent patent in the UK was held invalid for lack of novelty and for obviousness. That decision was upheld by the Court of Appeal in a judgment of 9 May 2008 (see: Les Laboratoires Servier v Apotex Inc [2008] EWCA Civ 445). Lord Justice Jacob, with whom the Lord Chief Justice and Lloyd LJ agreed, was scathing in his analysis of the patent, saying that the application for it was "specious", that the patent was a "type of undesirable patent" and a "try-on". His Lordship then dealt with the questions of novelty and obviousness of the claimed invention and comprehensively dismissed the appeal as being "without merit" on the basis that claim 1 and the process claim lacked novelty. I mention this, not because his Lordship's characterisation and opinion are relevant to this application, but to put in context the decision by Servier to seek to add the new claims and its decision to continue the proceedings for infringement of the existing claims against Apotex. Servier did not say that the UK proceedings were a reason it sought the amendments. However, a document produced following the Court's orders of 14 October 2008 showed that invalidity concerns raised in the UK were a reason.
125 Section 105(2) specifically provides that the Court may make an order for amendment subject to such terms as it thinks fit. Such a term may include an order excluding the right to commence proceedings with respect to any infringement of those claims prior to amendment, even if s 115 does not apply (Bucknell et al, Australian Patent Law (LexisNexis Butterworths, 2004) at 105.9 citing Pracdes Pty Ltd v Stanilite Electronics Pty Ltd (1995) 35 IPR 227).
126 In my view, it is appropriate to exercise the discretion afforded by s 105 to refuse the proposed amendments. I do not accept that there was an "iterative process" in Servier's reasons for amendment. It may well be that Mr Hamer had his own reasons for proposing amendment but I do not accept that those reasons were those of Servier's at the relevant time. The UK proceedings exposed the arguments relied upon to establish invalidity of the AC Patent. Servier was entitled to seek to amend the Australian patent to strengthen it but was then obliged to inform the Court of that reason. To the contrary, Servier put forward other reasons or permitted other reasons to be advanced. It was only when Servier produced documents pursuant to the Court's order of 14 October 2008 that the correspondence between Servier and its solicitors demonstrated that the reasons for the application to amend were not limited or based upon those set out in Mr Hamer's first affidavit. Further, as noted above, the reference in Mr Hamer's second affidavit to the reduction of invalidity risk was said by Servier to be a "general" statement, rather than being of particular relevance to the AC Patent. Servier failed voluntarily to disclose all relevant matters until they were exposed by Apotex. That failure to disclose was not of some minor, though strictly relevant, matter. It was a failure to disclose Servier's reason for the amendments.
127 Full and frank disclosure on Servier's part did not require Servier to trawl through all of its documents to see whether there were any relevant to the exercise of the discretion to permit amendment. Nor did it require Servier to provide all of its documents to the Court as a policy of caution (cf Oxford Gene at [19]-[21]). Servier should have given its reason for the amendments voluntarily and at the time it sought the amendments. It knew the grounds of Apotex's opposition to the amendments and it knew of Apotex's challenge to the validity of the corresponding patent in the UK and its defence to infringement. That clearly raised the scope of the claims and the reasons to amend them (Vector Corp v Glatt Air Techniques Ltd [2007] RPC 12).
128 Servier had ample opportunity to amend the AC Patent application if it was of the view that it contained additional claimable matter. It litigated the unamended patent in the UK and pursued the grant of the unamended patent in Australia, abandoning the s 104 amendments. Servier has not sufficiently explained why it took this course. At the time of abandoning the s 104 amendments, Servier was aware of the first instance decision in the UK. Servier's conduct in relation to the amendments disentitles it from presently amending the AC Patent in circumstances where litigation over the validity of that patent with Apotex was in clear prospect and the contest over the patent had already commenced. The lack of forthrightness in providing Servier's reasons to amend reinforces that conclusion.