Prima facie case
21 It is made clear in O'Neill that a prima facie case is one in which there is a probability that at trial the applicant will be held entitled to relief. The inquiry of whether there exists a "prima facie case" does not require Apple to show that it is more probable than not that it will succeed at trial. In O'Neill, Gummow and Hayne JJ said at [65] that 'it is sufficient that the plaintiff show a sufficient likelihood of success to justify in the circumstances the preservation of the status quo pending the trial'. Their Honours observed, quoting Beecham at 622, that 'how strong the probability needs to be depends, no doubt, upon the nature of the rights [the plaintiff] asserts and the practical consequences likely to flow from the order he seeks'. Their Honours emphasised at [71] that this is the "governing consideration". This is particularly relevant where the grant or refusal of an interlocutory injunction would, in effect, dispose of the action finally in favour of whichever party succeeds on that application (at [72]), which both Apple and Samsung contend is the case here.
22 The parties agree that the principles outlined in O'Neill are to be applied in determining whether there is a prima facie case. However, bearing in mind that Samsung has filed a cross-claim alleging, inter alia, the invalidity of the Touch Screen Patent, the parties are in dispute as to the relevance of the existence and strength of the case for invalidity of the Touch Screen Patent to the assessment of the likelihood of Apple being successful at a final hearing in its case on infringement of that patent.
23 Samsung relies on statements made by the High Court in Beecham, which concerned an application for an interlocutory injunction in a patent case. Their Honours said at 623:
[Whether the plaintiff has made out a prima facie entitlement to relief] in the present case is not complicated by the special considerations which generally arise in a patent action where there is a substantial issue to be tried as to the validity of the patent. In such an action the plaintiff's prima facie case must be a strong one so far as the question of validity is concerned, for he asserts a monopoly and must give more proof of the right he claims than is afforded by the mere granting of the patent… The general practice in that kind of case has long been to refuse an interlocutory injunction unless either the patent has already been judicially held to be valid or it has stood unchallenged for a long period… Even if the patent is an old one - which for this purpose is generally taken to mean more than six years old - it has been said that an interlocutory injunction will generally be refused provided that the defendant shows by evidence "some ground" for supposing that he has a chance of successfully disputing the validity of the patent at the trial… This should be read, however, with Sir George Jessel's statement in Dudgeon v Thomson (1874) 30 LT 244 which divides into three classes the cases in which an injunction may be granted before the hearing in such a case. They are: (1) cases where the patent is an old one and the patentee has been in long and undisturbed enjoyment of it; (2) cases where its validity has been established elsewhere and the court sees no reason to doubt the propriety of the result; and (3) cases where the conduct of the defendant is such as to enable the court to say that, as against the defendant himself, there is no reason to doubt the validity of the patent.
24 Samsung contends that Beecham establishes the proposition that where, on an application for an interlocutory injunction, the question of the validity of the patent has been strongly put in issue, the patentee must give 'more proof of the right he claims than is afforded by the mere granting of the patent' (at 622).
25 However, as noted by Jagot J in Alphapharm Pty Ltd v Wyeth (2009) 82 IPR 71 at [34], this aspect of Beecham was distinguished by Gummow J in Martin Engineering Co v Trison Holdings Pty Ltd (1988) 81 ALR 543. Justice Gummow observed at 549 that the cases referred to in Beecham were under older United Kingdom legislation in which the standards of validity required to obtain the registration of a patent were not as stringent as the Australian standards and concluded at 550 that the law on interlocutory relief in patent cases had since been brought into line with changes in the underlying substantive law.
26 Justice Jagot noted in Alphapharm at [36] that Gummow J's analysis in Martin Engineering has been applied by Moore J in Merck and Co Inc v GenRx Pty Ltd (2006) 70 IPR 286, Gyles J in GenRx Pty Ltd v Sanofi-Aventis (2007) 73 IPR 502, Jessup J in Interpharma Pty Ltd v Commissioner of Patents (2008) 79 IPR 261 and Sundberg J in Sigma Pharmaceuticals (Australia) Pty Ltd v Wyeth (2009) 81 IPR 339. It is worth noting that, in GenRX, Gyles J observed at [5] that any reaffirmation of Beecham following O'Neill lies in its explanation of what is involved in establishing a prima facie case, rather than any consideration of the application of these principles to patent infringement.
27 Faced with this difficulty, Samsung points to observations made by Emmett J in F Hoffman-La Roche AG v New England Biolabs Inc (2000) 99 FCR 56 at [48]-[57], which, Samsung contends, stand for the propositions that, first, the Patent Office test for acceptance and grant of a patent is well short of the stringency suggested in Martin Engineering and, secondly, the mere fact that a patent is granted, even over opposition, is no guarantee of its validity. A similar submission was considered by Gyles J in GenRX. His Honour stated at [5] that he did not necessarily agree with Hoffman-La Roche but said that, in any event, Hoffman-La Roche does not detract from the proposition that the Commissioner is charged with the responsibility of examining the validity of a patent before grant, including any relevant question of lack of novelty.
28 Prima facie, Apple's granted patents are valid by reason of their grant and registration. This presumption can be overcome by establishing that the patent is not valid, for example for want of novelty, as is asserted in this application for the claim of the Touch Screen Patent relied on for infringement. Samsung effectively submits that the presumption should be disregarded because a patent is only rejected for grant if it is shown during the course of examination that it is "practically certain" that the patent is invalid (Hoffman-La Roche). I accept, of course, that the mere grant of a patent is not sufficient of itself to maintain validity where that is challenged, but there is a degree of stringency specified in the Act which is also relevant (Martin Engineering at 549-550). Examination, the opportunity for opposition and then the grant and registration of that granted patent are part of a system whereby a granted patent is prima facie evidence of validity. That presumption can be displaced but it should not be ignored where the patentee applies for an injunction to restrain exploitation of the invention the subject of the patent. That is part of the nature of the patent right and forms part of a patentee's prima facie case.
29 As in O'Neill¸ which was a defamation case, 'there is no doubt about the legal right which [Apple] seeks to vindicate in the action, although the existence of that right is disputed' (at [2] per Gleeson CJ and Crennan J). Apple's case is for infringement of a valid patent. Apple will ultimately have to succeed both on infringement and validity. Where both infringement and validity are in contest, if mathematical probability of success were the sole criterion, Apple would need to show a greater probability of succeeding on each of those issues in order to demonstrate a probability of success given that it is necessary to succeed on both. However, it is made clear in O'Neill, in particular by reference to Beecham, that, in the case of a granted patent, other factors arise which may affect the strength of probability that it is necessary to establish. Justices Gummow and Hayne at [68] cited the remarks of Lord Diplock in American Cyanamid v Ethicon Ltd [1975] AC 396 to the effect that it was not necessary to demonstrate more than a 50 per cent chance of ultimate success in order to establish a prima facie case of patent infringement. Further, their Honours observed at [69] that Beecham and American Cyanamid were both patent infringement cases. Their Honours also noted that, in Beecham, Kitto J stated that it was not necessary for a plaintiff to show that it was more probable than not that it would succeed at trial.
30 Apple submits that, as considerable significance is to be attributed to the grant of a patent, it is for Samsung to show that invalidity is a triable question. Apple contends that, if a patentee is able to show that there is a prima facie case of patent infringement, then the existence of a triable question on validity is unlikely to displace that prima facie case. In Interpharma, Jessup J concluded that each of the bases of invalidity relied upon in that case was not sufficiently strong as to require the conclusion that there was no prima facie case of infringement. Apple relies on the following statement of Jessup J at [17]:
In a patent case, the fact of registration constitutes prima facie evidence of validity… It has been said that it is for the respondent to show that want of validity is a triable question... This seems clear enough, but, in my opinion, the analysis needs to be taken a step further. Is it sufficient that the respondent does show a triable question on validity? In my view, if that is as far as the respondent goes, then, assuming always that the applicant has shown a triable issue on infringement, absent questions of validity, the conclusion would remain that the latter had a triable question. That is to say, as a matter of analysis, unless the case for invalidity is sufficiently strong (at the provisional level) to qualify the conclusion that, overall, the applicant has a serious question, or a probability of success, the court should move to consider the adequacy of damages, the balance of convenience and other discretionary matters. It is the applicant's title to interlocutory relief which is under consideration, and the bottom-line question, as it were, is whether the applicant has a serious question, or a probability of success, not whether the respondent does in relation to some point of defence raised or foreshadowed.
31 This statement was adopted by Sundberg J in Sigma at [16]. In Alphapharm, Jagot J considered the competing forces of [17] of Interpharma and the passage in Beecham which I cited at [23] above. After noting that this aspect of the approach in Beecham had been 'consistently distinguished', her Honour adopted the approach in Interpharma (at [37]).
32 I will adopt the approach set out in [17] of Interpharma, not only for reasons of comity but also because, with respect, I agree with it.
33 Justice Jessup concluded that, as a matter of analysis, it is the applicant's entitlement to interlocutory relief that is under consideration and that, where the applicant has shown a probability of success, in the relevant sense, on infringement, questions of validity need to be sufficiently strong to qualify the conclusion that an applicant has passed that hurdle. The Court should then, his Honour said, move to consider the adequacy of damages, balance of convenience and other discretionary matters. As expressed in [17], his Honour was considering invalidity as a defence and that it was for a respondent to show that it was a triable question. His Honour did not make specific reference to the fact that an applicant must establish infringement of a valid claim. However, it is clear, in my opinion, that Jessup J had that clearly in mind, having noted at the commencement of [17] that registration of the patent is prima facie evidence of validity. His Honour was not, as I read his reasons, stating a universal "test" that a triable issue of invalidity that is not "sufficiently strong" is always insufficient to overcome a prima facie case on infringement. However, to the extent that his Honour was saying that it is necessary to assess the strength of each of the infringement and validity cases bearing in mind that the applicant has a registered patent, then such an approach is apposite where those matters are in issue. This applies both to the establishment of a prima facie case and to circumstances relevant to the question whether it is in the interests of justice to make the interlocutory order sought.
34 This case is not the same as Smith & Nephew Pty Ltd v Wake Forest University Health Sciences (2009) 82 IPR 467, in which the parties agreed that if the claim relied on for infringement was, as a matter of construction, characterised as a mere collocation rather than as a combination, the claim was invalid and no serious question of infringement would arise. In that case, the parties accepted that the Full Court was able to determine that question without resort to the evidence of a skilled reader. Construction was wholly determined by looking at the "language in the claims" to determine whether one of the integers of the claim, the bag in which the apparatus was packaged, interacted with the other integers such as to be part of a true combination (at [35]). The Full Court did so, found that it had been demonstrated that the claim was invalid, and accordingly, no serious question of infringement arose.
35 In this case, the asserted invalidity does not depend simply on the "language of the claim". Here, the asserted invalidity concerns the understanding of the claim by a skilled reader and the nature of the disclosure of two prior publications to such a skilled reader. Those matters are not agreed.
36 In my view, if Apple establishes a prima facie case of infringement in the O'Neill sense, having already established a prima facie case of validity by reason of registration of the patents, it will be necessary to ascertain whether Samsung's case on invalidity is sufficiently strong such that, if the evidence remains as it is, there is no longer a sufficient likelihood that at trial Apple will be entitled to relief for infringement of valid patent claims so as to justify the maintenance of the status quo. That would require Samsung to be restrained from selling the Australian Galaxy Tab 10.1.