Imperial Chemical Industries PLC v EI Dupont De Nemours & Co

REASONS FOR JUDGMENT 1 I have before me an application for a stay of orders made by the Full Court on 23 August 2002. The orders resulted from an application for leave to appeal from a decision of a judge of the Court given in opposition proceedings under the Patents Act 1990 (Cth) ("the Act"). On 1 April 1992 Patent Application No.654176 was lodged by Imperial Chemical Industries PLC ("ICI"). That application was advertised, then accepted on 27 October 1994. On 27 January 1995 E I Du Pont De Nemours & Co ("Du Pont") filed a notice of opposition. On 11 October 1999 a delegate of the Commissioner of Patents ("the Delegate") concluded that the opposition was unsuccessful on all grounds and directed that the application proceed to sealing. 2 Du Pont appealed to the Court from that decision pursuant to section 60(4) of the Act. ICI subsequently assigned its interest in the application to Ineos Fleur Holding Limited ("Ineos"), which became a party to the proceeding. On 5 April 2002 Branson J ordered that the appeal be upheld, that the decision of the Delegate be set aside and that the application be refused. The effect of the Full Court's order refusing leave to appeal was that the decision of her Honour stands. Ineos now wishes to seek leave to appeal to the High Court of Australia from the orders of the Full Court refusing leave. 3 When an application for special leave to appeal is made to the High Court, jurisdiction to stay may be exercised by the court below and it is to that court that an application for a stay should first be made. A number of considerations arise in the exercise of the discretion to grant a stay. Two of the considerations are as follows: · there is some substantial prospect that special leave to appeal will be granted; and · if there is no stay, there will be irreparable loss to the prospective applicant because the appeal would be futile, assuming leave is granted. 4 The decision of the Delegate was made under s 60 of the Act. Under s 60(1), where the grant of a standard patent is opposed, the Commissioner must decide the case in accordance with the Regulations made under the Act. Under s 60(4), the applicant may appeal to the Federal Court against a decision of the Commissioner made under s 60(1). Under s 160 of the Act, on the hearing of an appeal against a decision of the Commissioner, the Federal Court may affirm, reverse or vary the Commissioner's decision or give any judgment or make any order that in all the circumstances it thinks fit. Under s 28 of the Federal Court of Australia Act 1976 (Cth), the Full Court on the hearing of an appeal may exercise the same powers as the primary judge from whom the appeal is brought. Under s 37 of the High Court of Australia Act 1979 (Cth), the High Court could exercise the same powers. 5 Details of the status of pending patent applications are recorded in the patent administration system administered by the Patent Office ("the System"). Patent attorneys and members of the public wishing to ascertain the status of a patent application may search the System on line. In addition, changes to the status of a patent application are advertised in the Official Journal of Patents. 6 At present, the System records the status of the patent application in question as having been advertised and accepted. If no stay of the orders of the Court is granted, then the status of the patent application will be changed in the System to showing the application as having been refused. The refusal will be advertised in the Official Journal of Patents. The database of the System does not operate to record the level of detail necessary to show that a patent application is subject to an order of the court that has been stayed by a further order of the court. 7 However, if any person makes an inquiry as to the status of such an application, where copies of any orders of the Court, such as a stay, have been lodged with the Patent Office, that person would be informed by staff of the Patent Office of the existence of the orders. Any person may obtain copies of publicly available documents from the files of the Patent Office in relation to the application, including copies of correspondence enclosing copies of orders made by the Court. 8 The provisional concern expressed on behalf of Ineos is that, if a stay is refused, the effect of the order made by Branson J is that the database of the System may possibly mislead persons who enquire on line into believing that the application for the patent has been finally determined. The concern is that such a person, by merely making a search on line, may be induced to believe that the application has been finally refused and may act accordingly. However, if leave were granted by the High Court and the appeal were upheld such that the original decision of the Delegate were reinstated and the application proceeded to grant, such a person may have acted in a detrimental fashion by infringing the patent and exposing him, her or itself to an action for infringement. 9 That possibility, if it is a deficiency, is a deficiency inherent in the System. I am by no means satisfied that it is a deficiency, since any person upon due inquiry of the Patent Office will be informed of the precise status of the proceeding. It may be that members of the public would rely on the on line inquiry facility and nothing more. For that reason, in an ideal world, it would be preferable for the Patent Office to have a system that notified persons who inquire on line of the currency of opposition proceedings. However, the arrangement clearly has utility and questions of proportionality in relation to costs and convenience must be considered. As I have said, if there is a deficiency it is one inherent from the very beginning once notice of opposition has been lodged. It is not a problem that arises by reason of the currency of an appeal alone. 10 Under section 61(1)(b) of the Act, the Commissioner must grant a standard patent if, in spite of opposition, the Commissioner's decision, or the decision on appeal, is that a standard patent should be granted. The grant will be recorded in the Register of Patents kept at the Patent Office under section 186 of the Act. However, having regard to the result of the appeal and the refusal of leave by the Full Court, no entry would be required so far as the Register is concerned. 11 It is usual, for at least two reasons, to stay an order for revocation of a patent pending an appeal from the order for revocation - see, for example, Atlantis Corp Pty Ltd v Schindler [1997] FCA 1105 and Doric Products Pty Ltd v Lockwood Security Products Pty Limited 2002 FCA 282. The first is that, if the order be given effect to and the patent be revoked on the Register, there may be some doubt as to the power of the Court to reinstate the patent in the event that the appeal is upheld. As I have said on an earlier occasion, I would be surprised if there is no inherent jurisdiction vested in the Court to give effect to a determination on the appeal. Nevertheless, in order to avoid such an argument, it is desirable, if possible, to ensure that the status quo be maintained pending the determination of an appeal when the state of the Register is in question. That, of course, is not this case. 12 The second reason why it is usual to stay an order for revocation is that the determination of the validity of the patent affects the community generally. But for the stay, members of the public might, in reliance on the state of the Register, engage in conduct that might ultimately amount to an infringement if the appeal were upheld. That is a similar consideration to the one to which I have referred. However, in this case, there is no question of the state of the Register; there is only a question as to the state of the application. Any member of the public would be unwise to rely solely on an on line inquiry concerning the status of an application without examining the file itself or making a further enquiry of the Patent Office. 13 It is the Register that is of significance. A member of the public could not be certain, one way or the other, as to the status of an application until it is finally granted or refused and there are no longer opposition proceedings current or an appeal from such opposition proceedings current. If, ultimately, Ineos is successful and a patent is granted, it will, by the operation of s 57(1) of the Act, have the same rights in respect of any infringement as it would have had had there been no opposition or if the opposition had been determined favourably to the applicant. 14 I am not persuaded, in the circumstances, that there is any need for a stay. The refusal of a stay will not in any way prejudice the interests of Ineos. Any appeal, if successful, would have the effect, by the operation of s 57, of conferring upon it the same rights to proceed by way of infringement proceeding as if there had been no opposition in the first place. The appeal would not be rendered futile by the refusal of a stay. No irreparable damage, and indeed no damage at all that could not be remedied by appropriate orders for costs, would be suffered by Ineos by the orders of Branson J taking effect. 15 Of course, in order to grant a stay I would also have to be persuaded that there was some reasonable prospect of leave being granted and the appeal being upheld. However, I do not decide the application for a stay on that basis. Having been a member of the Full Court that concluded that leave should be refused I have clearly formed a view as to the questions that would be raised in the High Court. However, having regard to the complexity of any issue that arises in relation to a patent proceeding, I would not have refused a stay on that ground alone. Whether or not there are substantial prospects of success, I am not satisfied that an appropriate case for stay has been established by reason of possible detriment to the applicant. Accordingly I refuse the application for a stay. I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Emmett.