Inverness Medical Switzerland GmbH v MDS Diagnostics Pty Limited

Date of hearing: 26, 30, 31 March 2009, 1, 8 April 2009, 13 May 2009

Date of last submissions: 15 June 2009

Place: Sydney

Division: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 205

Counsel for the Applicant: Ms K Howard SC, Mr P Flynn

Solicitor for the Applicant: Addisons Lawyers

Counsel for the First, Second and Third Respondents: Mr A Franklin SC, Mr A Fox

Solicitor for the First, Second and Third Respondents: Breens Lawyers until 27 November 2009, Douros Lawyers thereafter

Counsel for the Fourth and Fifth Respondents: The Fourth and Fifth Respondents did not appear.

NEW SOUTH WALES DISTRICT REGISTRY NSD 1722 of 2006

AND: MDS DIAGNOSTICS PTY LIMITED (ACN 090 764 702)

1. The parties submit proposed orders within 14 days to give effect to these reasons.
2. The parties file and serve any submissions on costs within 14 days. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using eSearch on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY NSD 1722 of 2006

AND: MDS DIAGNOSTICS PTY LIMITED (ACN 090 764 702)

REASONS FOR JUDGMENT The Respondents................................................................................................... [3] The patents.............................................................................................................. [7] PRINCIPLES OF CLAIM CONSTRUCTION............................................................ [12] THE SKILLED ADDRESSEE...................................................................................... [16] BACKGROUND CHEMISTRY and terminology.......................................... [21] construction of terms in THE patents.................................................. [29] "Specific Binding Reagent"....................................................................................... [30] The positions of Inverness and MDS..................................................................... [32] The evidence of the experts.................................................................................... [38] Consideration of the meaning of "specific binding reagent for an analyte" in the first patent......................................................................................................... [44] Generally..................................................................................................... [44] Embodiments and examples of the invention....................... [51] The claims.................................................................................................... [65] Summary of the main reasons for the conclusion that the meaning of "specific binding reagent for an analyte" is not a reagent that binds only the target analyte but one that binds the analyte in a specific binding reaction................ [69] The second, third and fourth patents.................................................................... [70] "Dry porous carrier".................................................................................................. [74] Bibulous sample liquid receiving member "within said casing"............................... [82] Porous material backed with transparent moisture-impervious material................ [88] infringement GENERALLY, apart from consideration of validity...................................................................................................................... [93] The first and second patents...................................................................................... [93] The third patent.......................................................................................................... [94] The fourth patent........................................................................................................ [96] Electron micrograph evidence............................................................................... [97] Email from the manufacturer of macroporous body in the MDS devices............ [106] validity...................................................................................................................... [114] Applicable law............................................................................................................. [114] Utility........................................................................................................................... [115] Sufficiency................................................................................................................... [130] Clarity.......................................................................................................................... [135] Priority date of the third patent.................................................................................. [140] Disclosures in the first patent and the Parent Priority Documents.................... [146] Fair basing on the Parent Priority Documents.................................................... [149] Fair basing on the first patent............................................................................... [152] Novelty - third and fourth patents............................................................................. [156] Legal principles...................................................................................................... [156] Third patent............................................................................................................ [157] Fourth patent.......................................................................................................... [159] liability of dr appanna.................................................................................... [176] Joint tortfeasor........................................................................................................... [179] Authorising conduct of MDS - s 13(1) of the 1990 Act............................................. [193] MDS' CROSS CLAIM UNDER S 128 OF THE 1990 ACT....................................... [204] CONCLUSION............................................................................................................... [205]

1 The applicant (Inverness) is the owner of four patents (together, the patents). The inventions described and claimed in the patents relate to assays involving specific binding, especially immunoassays. The device described in the patents is an analytical device suitable for home use as a single step device for, but not limited to, pregnancy testing. 2 Inverness alleges that pregnancy testing devices marketed under the names of QuickStream (QuickStream) and QuickCard (QuickCard) infringe various claims in its four patents. The proceedings relate to questions of infringement and validity of the patents. Issues of liability and quantum have been separated.

The Respondents 3 The application seeks orders against five respondents. Only the first three respondents have filed a notice of appearance. The first respondent (MDS Aus) is the sponsor under the Therapeutic Goods Act 1989 (Cth) of, and the second respondent (MDS NZ) is the New Zealand and Australian distributor of, QuickStream and QuickCard (together the MDS devices). 4 The third respondent, Dr Appanna, is a director of both MDS Aus and MDS NZ. Inverness alleges that Dr Appanna is personally liable as a joint tortfeasor for the infringement by the MDS companies and also for authorising the same infringement. When referring to the submissions made by the first to third respondents, I will refer to the three respondents together as MDS, unless I need to refer to them individually. 5 The fourth respondent was deregistered on 5 November 2008. The proceedings as against the fourth respondent have been brought to an end, as the fourth respondent has ceased to exist on deregistration (s 601AD(1) of the Corporations Act 2001 (Cth)). The proceedings against the fourth respondent should be dismissed with no order as to costs. 6 Inverness informs me that on 21 September 2007 the fifth respondent entered into a personal insolvency agreement under the Australian Bankruptcy Act 1966 (Cth)such that the proceedings against him have been stayed. Inverness has taken no further steps in the proceedings against him since that time. As requested by Inverness, I will grant leave for Inverness to file a notice of discontinuance of the proceedings against the fifth respondent. The fifth respondent has not filed an appearance. There will be no order as to costs as between Inverness and the fifth respondent.

The patents 7 Australian Patent No. 626207 is a PCT application (the first patent). There is no challenge to the fact that the invention there described involves an inventive step. From that parent patent, two divisional patents, Australian Patent No. 656966 (the second patent) and Australian Patent No. 656967 (the third patent) were granted. Questions of the priority date have been raised in respect of the third patent. Australian Patent No. 643430 (the fourth patent) was filed separately. There is no dispute the invention described in the fourth patent involves an inventive step. The fourth patent is not a divisional and takes its own filing date, 16 February 1990, as its priority date. The first, second and third patents expired on 26 April 2008. 8 The parties have presented the infringement issues by reference to claim 1 of each patent with the proviso that, if claim 1 of the third patent is anticipated, it will be necessary to consider claims 9 and 10 of that patent. As to the third patent, Inverness initially claimed infringement of claims 1, 2, 3 and 4. Those claims then formed the basis of MDS' attack on validity. Inverness now claims infringement also of claims 9 and 10. MDS says that it is not in a position to deal with the validity of those claims. 9 MDS challenges the validity of all four patents on the grounds of lack of utility and sufficiency. If its argument on the priority date of the third patent is accepted, MDS also challenges claims 1 to 4 of the third patent on the basis of lack of novelty. It further challenges the validity of the claims of the fourth patent on the basis of lack of novelty and challenges particular claims in the second and fourth patents on the basis of lack of clarity. 10 A key issue is the meaning of certain terms used in the claims, specifically: 1. "specific binding reagent for an analyte/ the same analyte" as it appears in the claims of the first patent and the second patent; 2. "specific binding reagent" as it appears in the claims of the third patent and the fourth patent; 3. "dry porous carrier" or "carrier", as they appear in the claims of the patents; 4. "bibulous sample liquid receiving member within said casing" in sub-paragraph (b) of claim 1 of the third patent; and 5. "porous material backed with a layer of transparent moisture-impervious material" in claim 9 of the third patent. 11 During the course of the hearing MDS accepted that if either QuickStream and QuickCard are found to infringe any of the four patents, MDS NZ (as well as MDS Aus) exploited that patent in Australia within the definition of "exploit" in the Patents Act 1990 (Cth) (the 1990 Act). Relevantly to the claimed infringement, MDS also admitted during the hearing that the reagent in the detection zone of the MDS devices is "permanently immobilised" and that the label used in the labelled reagent is a "particulate direct label" within the meaning of the claims of the patents.

PRINCIPLES OF CLAIM CONSTRUCTION 12 There is no issue between the parties as to the principles to be applied in the construction of patents, drawn from Welch Perrin and Company Proprietary Limited v Worrell (1961) 106 CLR 588, Minnesota Mining and Manufacturing Company v Beiersdorf (Australia) Limited (1980) 144 CLR 253and Kimberly-Clark Australia Pty Limited v Arico Trading International Pty Limited (2001) 207 CLR 1. 13 It is of particular importance to keep in mind that the question is what the person skilled in the art would have understood the patentee to be using the language of the claim to mean (Kirin-Amgen Inc v Hoechst Marion Roussel Ltd [2005] 1 All ER 667; (2004) 64 IPR 444 at [34] per Lord Hoffman; H Lundbeck A/S v Alphapharm Pty Ltd (2009) 177 FCR 151 at [118] per Bennett J (Middleton J agreeing)). It is necessary to read the whole of the patent, including the claims, and to construe the terms in dispute through the eyes of the skilled addressee. The complete specification is to be construed in the light of the common general knowledge as at the priority date (Kimberly-Clark at [24]). 14 The claims are construed in the context, and not in isolation, of the specification. That is not to say that the clear meaning of a claim can be varied by reference to the body of the specification, although terms which are unclear may be clarified by reference to the body of the specification (Kimberly-Clark at [15]). As noted by Sheppard J in Décor Corporation Pty Ltd v Dart Industries Inc (1988) 13 IPR 385 at 410, the claim should be understood and interpreted in the context of the specification as a whole. As Sheppard J went on to say, there are two specific circumstances in which the body of the specification may be referred to. One is where there is ambiguity. The other is where the specification discloses an intention that words used elsewhere are to have a particular meaning, in which case that meaning should be given effect because the draftsman of the patent has used his or her own dictionary (Décor at 410-41; Flexible Steel Lacing Company v Beltreco Ltd (2000) 49 IPR 331 at [76] per Hely J). 15 An essential part of the process of construction involves understanding the nature of the invention described and claimed and the way in which the patentee has used words or phrases in describing and then claiming that invention. Sometimes the patentee provides a clear dictionary in the body of the specification for words and phrases. However, that is not always the case. While a patent is a public instrument which must define a monopoly in such a way that it is not reasonably capable of being misunderstood, it is also appropriate to try to understand what the patentee seeks to convey by the words used, especially where those words convey matters of biological or technological complexity (see generally Welch Perrin). The body of the specification may be used to resolve ambiguities or to clarify what is uncertain in meaning. It may not be used to restrict, expand or qualify what appears in the claim (Interlego AG v Toltoys Proprietary Limited (1973) 130 CLR 461 at [16]). However, as stated in Sachtler GmbH and Co KG v RE Miller Pty Ltd (2005) 22 ALR 373 at [42] per Bennett J, there is a fine line between, on the one hand, reading down the words of a patent claim to reflect how a person skilled in the art would understand it in a practical and common sense way and, on the other, impermissibly limiting the clear words of a claim because a reader skilled in the art would be likely to apply those wide words only in a limited range of all the situations they describe (citing Stanway Oyster Cylinders Pty Ltd v Marks (1996) 66 FCR 577 at 585 per Drummond J).

THE SKILLED ADDRESSEE 16 Neither Inverness nor MDS has objected to the evidence of the expert witnesses. There is a slight difference between the parties in the characterisation of the skilled addressee. Inverness contends that such a person is one with a practical interest in immunoassays and immunoassay kits. MDS' characterisation is a person experienced in the area of assay development, particularly immunoassays and in generating, working with and characterising antibodies. Both parties accept that the person may either have a PhD in Science or have otherwise gained such experience. 17 Inverness relies on the evidence of Ms Boscato, who leads the manual immunoassay team at St Vincent's Hospital in Sydney. Ms Boscato is a person who works at a bench in a laboratory rather than being a theoretical researcher. She has designed and made immunoassays, uses them routinely and has a "practical interest" in the subject matter of the invention. 18 MDS relies on the evidence of Dr Sinosich, the Scientific Director of the Prenatal Testing and Molecular Genetics Divisions of Sonic Clinical Institute in Sydney. He supervises Australia-wide prenatal screening and molecular testing and accreditation of assays as provided by the Sonic Clinical Institute. In summary, Dr Sinosich has worked in the field of immunoassay development, including immunoassays for a range of fertility, pregnancy and non-pregnancy associated analytes. He has generated both polyclonal and monoclonal antibodies; all of his research activity has been antibody-based. Dr Sinosich has primarily undertaken development of quantitative immunoassays for detection of pregnancy-associated analytes (a competitive immunoassay). The fundamental principles utilised in that work are equally applicable to qualitative immunoassays (such as a sandwich design). Inverness does not challenge Dr Sinosich's qualifications but says that he is more of a theoretical researcher. 19 Dr Sinosich states that, in his opinion, in relation to the test strip aspect of the inventions, the patents are addressed to a person experienced in the area of assay development (specifically immunoassays) who generates, works with and characterises antibodies. Other persons would become involved to develop the casing associated with the strip and commercialise the product. 20 While the respective experts differ in their qualifications and experience, each of MDS and Inverness accept that both of the experts, Dr Sinosich and Ms Boscato, are skilled addressees able to give evidence of terms of art and of the understanding of the person skilled in the art of the language of the specifications and the claims.

BACKGROUND CHEMISTRY and terminology 21 The background chemistry is not in dispute. Inverness stresses, however, that as at the priority date of the first patent in 1987, some of the knowledge was not as advanced as it is now. 22 Immunoassays are a type of analytical technique used to detect, either quantitatively or qualitatively, a hormone or marker of some kind. Hormones are molecules that are released in one area of an organism to exert their action in another area of the organism. A marker is a molecule that has particular attributes associated with a function or physiological state. The hormone or marker that is the subject of the immunoassay is known as the analyte. In the context of immunoassays, the antigen is referred to interchangeably as the analyte. The key reactants in an immunoassay are the analyte (antigen) and the antibody. 23 The analyte is the target molecule that is sought to be detected or measured. Some of the most common target molecules are the four trophic hormones (the glycoprotein hormones): luteinising hormone (LH), follicle stimulating hormone (FSH), thyroid stimulating hormone (TSH) and human chorionic gonadotropin (hCG). Of these, only hCG is pregnancy derived; that is, it is a peptide hormone produced in pregnancy. LH, for example, would normally be present in a non-pregnant woman's urine in varying concentrations, usually peaking at ovulation. hCG is heterodimeric, which means that it has two different parts: an α-subunit and a ß-subunit. The α-subunit is common to all four glycoprotein hormones which may be present in human urine: LH, FSH, TSH and hCG. Each is distinguished by its unique ß-subunit. In a pregnancy test, the analyte is hCG. 24 The antibody, also referred to as a binding reagent, may be used to identify the presence of the analyte. It is usually produced by the organism or host in response to immunisation with the antigen (analyte), that is, the introduction of the analyte to the organism or host. Immunisation is required to stimulate antibody production; a particular antigen induces the production of antibodies which can bind to it. The antibody can then be used in assays to measure or detect the analyte. Each antibody binds to a different part of the analyte which is termed the epitope or the antigenic determinant. There are one or more specific binding sites at which this binding occurs. If the epitope or a similar structure is present in another molecule, then the antibody could also bind to that molecule. These substances are then said to cross-react with the antibody. The antibody binds to a limited but defined number of substances. The number of cross-reactants and the degree of binding of the cross-reactants compared to the analyte determine the degree of specificity of the antibody. 25 Antibodies can be either polyclonal or monoclonal. Monoclonal antibodies are a single, pure, homogeneous type of antibody, produced by a single clone of cells, which react with a single epitope on the analyte. Polyclonal antibodies are a mixture of monoclones and therefore generally bind, with different affinities, to multiple epitopes on an analyte. Different antibodies may have different affinities for an epitope, so that there may be different strengths of binding. Immunoassays can use monoclonal or polyclonal antibodies. 26 Immunoassays can be either competitive or sandwich assays. As Dr Sinosich accepted, the development of those assays was still evolving as at the priority date. Both types of immunoassays use labelled reagents which may be either the antibody (sandwich) or the analyte (competitive). Labels used for tagging the analyte in competitive immunoassays are small molecules, such a, radioactive isotopes or metals. Labels for tagging the antibody in sandwich immunoassays can include small and large molecules, such as radioactive isotopes, metals or enzymes. Labelling enables detection and/or quantification of analyte-antibody complexes (immunecomplex) and, accordingly, the presence of the analyte. An immunoglobulin participates in an antigen/antibody reaction, in which there is binding to particular sites. 27 A competitive assay involves the use of a labelled analyte or analyte analogue which is physico-chemically identical to the unlabelled target analyte. The labelled analyte competes with the unlabelled target analyte for limited binding sites on the antibody. Competitive assays are used to determine the concentration of an analyte in a biological specimen. The strength of the signal from the label, whether it is colour or radioactivity, is inversely related to the analyte concentration. 28 A sandwich assay (which is a non-competitive assay) usually involves the use of two antibodies, with specificities directed at two distinct epitopes on the target analyte. One antibody is immobilised on an inert stationary surface to serve as capture. The other antibody is labelled. When the sample containing the analyte is added, the labelled antibody binds to it and forms an immunecomplex. The immunecomplex is then captured by the immobilised antibody, so that the analyte is sandwiched between the two antibodies. A sandwich assay can be used for detecting the presence of an analyte and also its concentration. In contrast to a competitive assay, the signal generated from the label is proportional to the amount of analyte present in the sample.

construction of terms in THE patents 29 The parties agree that, save where dependent claims are specifically referred to, questions of construction can be determined by reference to claim 1 in each patent.

"Specific Binding Reagent" 30 The primary issue in these proceedings is the construction of 'specific binding reagent for an analyte' in claim 1 of the first and second patents and of 'specific binding reagent' in claim 1 of the third and fourth patents. The parties agree that: (a) It is an essential integer of claim 1 of the first and second patents that the analytical test device must have a 'labelled specific binding reagent for an analyte'and an 'unlabelled specific binding reagent for the same analyte'. (b) It is an essential integer of claim 1 of the third patent that the analytical test device must have a 'labelled specific binding reagent'. (c) It is an essential integer of claim 1 of the fourth patent that the analytical test device must have a 'labelled specific binding reagent' and an 'unlabelled specific binding reagent'. 31 The MDS devices are devices for pregnancy tests where the analyte is hCG. These devices contain a labelled anti-ß hCG antibody in the first zone and an unlabelled anti-α hCG antibody immobilised in the detection zone. MDS accepts that the labelled anti-ß hCG antibody is a specific binding reagent within the meaning of the patents. MDS denies that the unlabelled anti-α hCG antibody is a specific binding reagent within the meaning of the patents. Accordingly, MDS submits that the MDS devices do not contain an unlabelled specific binding reagent, which is an essential integer of the claims of the first, second and fourth patents.

The positions of Inverness and MDS 32 Both parties have analysed the meaning of the expression "specific binding reagent" by reference to the first patent, the parent patent of the second and third patents. The substance of the difference between the parties as to the meaning of this term is whether this expression means that the reagent may bind not only to the analyte that is sought to be detected but also to other molecules related to the analyte (Inverness' position)or whether it means that the reagent will preferably bind only to the analyte and to no other molecule in the sample (MDS' position). 33 MDS characterises "specific" in the term "specific binding reagent" as the adjective applied to a binding reagent. Inverness does not dispute that "specific" alone can be used as an adjective. However, Inverness says that "specific binding reagent" as used in the patents is a composite phrase, in effect equated with "specific binding reaction". That is, a reagent can be specific in that it is able to bind to the hormone in a specific binding reaction but not totally specific, as it can bind other hormones as well. An anti-α hCG antibody is thus a specific binding reagent for the glycoprotein hormones but not totally specific for any one of them. 34 Inverness' position is that a specific binding reagent is something that binds to the analyte, in that it has an inherent specificity for the analyte, but may also bind to other molecules. That is, there may be cross-reactivity with other molecules. Inverness contends that the expression "specific binding reagent for an analyte"means 'a binding reagent which binds to the analyte in a specific binding reaction'. When used in the manner described in the claims of the first and second patents, it enables the presence of the analyte, or target molecule, to be determined. Inverness maintains that a specific binding reagent may bind to other molecules that are related to the analyte and still be a specific binding reagent for the analyte as long as it enters into a specific binding reaction with the analyte. It is not necessary that it be specific only for one analyte. The parties accept that if Inverness' construction is adopted, the anti-α hCG antibody in the MDS devices is a specific binding reagent. 35 MDS says that, in ordinary English, the word "specific" relevantly means '[s]pecially or peculiarly pertaining to a certain thing or class of things' so that a specific binding reagent is capable of discriminating between analytes. This capability is, MDS says, the meaning of the term in immunology now and before the priority date. Therefore, it says, the word "specific" imports the requirement that the reagent should bind to the target molecule and not to any other molecule. MDS says that this would be and would have been the understanding of skilled workers in the field. MDS says that "specific" equates with "absolute" but accepts that there may be a slight degree of cross-reactivity of the reagent with another protein, of the order of less than 1% and still be a specific binding reagent for an analyte. For the purpose of discussion, this property can be referred to as the reagent being "mono-specific". MDS says that simply because the antibody can bind to the analyte does not mean that it is specific for the analyte. Otherwise, MDS asks rhetorically, why include the word "specific" in the expression "specific binding reagent for an analyte"? 36 There is no dispute that the anti-α and anti-ß hCG antibodies used in the MDS devices both bind to hCG or that the combination of anti-α and anti-ß antibodies enable the specific detection of hCG from among the glycoprotein hormones. MDS says that the requirement imported by the expression "specific binding reagent" in the patents is that the reagent must bind only to hCG. Under this construction, claim 1 of the first, second and fourth patents would require both the labelled and unlabelled specific binding reagents to be mono-specific for hCG. This would require an anti-ß antibody in each case. The anti-α hCG antibody is not a specific binding reagent for hCG under this construction because it also binds to the other glycoprotein hormones. 37 MDS denies that the competing constructions are merely a matter of semantics. It points to the decreased likelihood of false positives in a testing device where the reagents will not bind to other molecules in the sample. It also points to the problem of false negative results in a device such as its own, where one of the two reagents, the anti-α hCG antibody, can bind the other glycoprotein hormones, such as LH and FSH, which can then compete with hCG and "fill up" the available anti-α antibodies such that hCG present in the sample may not be detected. MDS points to evidence that, where the reagents lack the required specificity, scavenger molecules (not part of the invention in the patents) are used to remove unwanted antigens or hormones such as LH to address cross-reactivity that could interfere with the assay. MDS says that without such scavenger molecules, devices which use binding reagents which can cross-react with other molecules in the sample are non-useful because of problems of false positive and false negative results.

The evidence of the experts 38 MDS relies on Dr Sinosich to support its submission that, to those skilled in the art of immunoassay in Australia before the priority date, the adjective "specific" used in relation to a reagent was a term of art meaning that the reagent will preferentially bind to the analyte in the immunoassay with no binding to any other molecule in the sample. Dr Sinosich emphasised that, otherwise, the immunoassay will not be able to detect the presence of the analyte to the exclusion of other molecules in the sample. Dr Sinosich was firmly of the view that, in the context of antibodies, "specific" in the phrase "specific binding reaction for an analyte", means that the reagent will bind the target molecule and no other: it is mono-specific. 39 I formed the clear impression that, while Dr Sinosich gave his opinion honestly and impartially, his approach was, as he conceded in evidence, influenced by his own specific area of expertise and his own rigorous approach to the relevant terminology. It was apparent during cross-examination when Dr Sinosich was taken to different parts of the specification that the patentee did not adopt the same limited use of terminology. This may be explained in part by the fact that the application of the patent is not limited to antigen-antibody reactions, or to pregnancy kits. 40 Dr Sinosich construed the patent as an expert in immunology interested in pregnancy testing. The patents are not based solely on the use of antibodies in an immunoassay to detect pregnancy or fertility. While the claimed invention especially relates to immunoassays, it is not so limited. Dr Sinosich accepted that, for other analytes referred to in the specification such as some hormones and proteins, a mono-specific reagent may not have been available, especially as at the priority date and he acknowledged that other skilled workers in the field may use words or expressions of relative specificity. Despite this, Dr Sinosich said that he applied his interpretation of "specific" and "specific binding reagent" uninfluenced by the way in which the terms were used in the specification or the context of the specification. His use of terminology which does not allow for relative specificity or degrees of specificity does not accord with Ms Boscato's evidence, or with much of the literature as at the priority date, or with the specification, which has broader application. Dr Sinosich's use of the terminology may well reflect his own experience and practice but the evidence suggests that it is not and was not the common use of others in the art to which the specification relates. 41 On the other hand, Ms Boscato agreed that, in the context of immunoassays, "specificity" means the ability to measure the analyte without interference from other substances which would cause a false positive response, or interference from other substances causing an inaccurate result. Some confusion was introduced into the evidence by the use of the word "specific" on its own, in questions concerning whether or not a reagent would bind only to hCG and therefore be specific. This term then introduced concepts of "totally specific" or "highly specific". Ms Boscato adopted and used these terms. However, she drew a distinction between the use of "specificity" and "specific" as stand-alone words and the use of "specific" in the phrase "a specific binding reagent for an analyte" which, she repeated, means that the reagent has to be able to bind the analyte of interest in a specific binding reaction, but not necessarily exclusively. Ms Boscato's understanding of the phrase "specific binding reagent for an analyte" is that it describes a reagent as 'a component used in an assay…for [an] analyte that is able to bind the analyte in a reaction that is particular to that reagent and analyte'. As used in the specification, Ms Boscato says that the phrase is used as a generic term for a broad range of molecules that are able to bind to the analyte of interest. Put shortly, as the evidence of Ms Boscato explained it, a reagent that participates in a specific binding reaction with an analyte or analytes may have different degrees of specificity for different analytes. 42 Ms Boscato explained that a specific binding reagent binds in a specific binding reaction, in contrast to binding that may be non-specific. Dr Sinosich also explained that a specific binding reaction is only one way of an analyte becoming bound. 43 Ms Boscato pointed to literature that formed part of the art as at the priority date, including papers by Dr Ekins who, she said, was regarded as the person who introduced specific binding assays. His articles were considered to be very important in the field at the time. Throughout the Ekins article in evidence, the phrase "specific binding reagent" is used as a composite phrase. This provides support for Inverness' submission that the expression "specific binding reagent for an analyte" as used in the specification, reflects and describes the prior art as of the priority date. This may explain why the phrase is used in the specification, although its use as a composite phrase does import redundancy in the use of "specific": Ms Boscato accepted that every binding reagent that binds to an analyte will bind in accordance with a specific binding reaction.

Consideration of the meaning of "specific binding reagent for an analyte" in the first patent

Generally 44 The expression "specific binding reagent for an analyte" is not self-explanatory. It is open to different interpretations and is an expression as to which the parties' experts differ. What are the indicia in the specification as to whether the specific binding reagent for the analyte binds exclusively to that analyte? The question is whether the expression "specific binding reagent for an analyte" in claim 1 of the first patent means, where the analyte is hCG, a reagent that binds with hCG in a specific binding reaction but may also bind with other hormones containing the α-subunit, or whether it means a reagent that binds with and only with hCG, that is, with its unique ß-subunit. The language of the specification is not rigorous. 45 The definitions of "specific" in ordinary English and immunology highlighted by MDS support both MDS' and Inverness' constructions of "specific binding reagent". On Inverness' construction, the reagent must engage in a specific binding reaction with the analyte of interest, which means that there must be a special binding site on the analyte capable of binding to that reagent. In that sense, it specifically binds with the analyte and is capable of discriminating between analytes. On MDS' construction, it binds only to the analyte of interest; it does discriminate between analytes. 46 The title of the specification of the first patent is 'Immunoassays and devices therefor'. The field of the invention is said to concern assays involving "specific binding", especially immunoassays. The background section of the specification refers to "specific binding assays, such as immunoassays". Previously proposed specific binding assays are described as involving the use of a specific binding reagent for the analyte which is immobilised and can therefore bind the analyte in the detection zone where the extent of binding can be determined with the aid of labelled reagents. The invention of the first patent is not to new reagents or new assay techniques. Rather, the invention improves and adapts known assay techniques in terms of the configuration, arrangement and labelling of reagents to operate in a test device suitable for home use. 47 A reading of pages 1 and 2 of the first patent discloses, inter alia, the following:

• The assays to which the invention relates involve specific binding especially, but not limited to, immunoassays or pregnancy tests.
• The invention also relates to "analytical devices" suitable for home, clinic, or surgery use. The devices are intended to give an analytical result which is rapid and which requires the minimum degree of skill and involvement from the user.
• The stated improvement is that these devices do not require the user to perform a sequence of operations to obtain an observable test result.
• The device is contacted with a sample, such as a urine stream, and no further action by the user is required.
• Prior methods are described, including the use of reagent-impregnated test strips in specific binding assays such as immunoassays. In such procedures,the sample is applied to one portion of the test material, usually with the aid of an eluting solvent such as water. The sample progresses into or through a detection zone where 'a specific binding reagent for an analyte' suspected of being in the sample is immobilised. Analyte present in the sample can therefore become bound within the detection zone. The extent of binding can be determined with the aid of labelled reagents.
• The promise of the invention is to provide diagnostic test devices especially suitable for home use which are quick and convenient to use and which require the user to perform as few actions as possible.
• The device can be applied to different analytes (also on page 17). 48 The specification describes different embodiments of the invention. In one embodiment (at page 4):
• The labelled reagent is a specific binding partner for the analyte.
• The labelled reagent, the analyte (if present) and the immobilised unlabelled specific binding reagent cooperate together in a "sandwich" reaction.
• This results in the labelled reagent being bound in the second zone if analyte is present in the sample.
• The two binding reagents must have specificities for different epitopes on the analyte. 49 The specification seems to draw a distinction between specificity and a specific binding reagent. The former is the characteristic that defines the ability of the reagent to identify only that analyte, the latter is the characteristic that ensures that the reagent does bind with the analyte in a specific binding reaction. There is repeated reference to "specific binding". MDS points out that any reagent which binds to an analyte binds in a specific binding reaction, so that the word "specific" is either redundant or imports a requirement of mono-specificity. Inverness' response is that, in context, "specific" refers to the type of binding: the binding reagent must bind to the analyte in a specific binding reaction, being one where it is known which particular sites are bound, standing in contrast to a non-specific binding reaction. Under this construction, examples of specific binding reagents are antibodies, receptors and binding proteins. Inverness submits that examples of non-specific binding would be the non-specific binding of the reagent to the preferred carrier material, nitrocellulose, and of the label to the reagent, as described in the specification. This can be contrasted with the specific binding that occurs between reagent and analyte, for example by recognition of an epitope. 50 I do not accept MDS's contention that "specific" in the phrase "specific binding reagent" and "specificity" have equivalent meanings in the specification. The Oxford Dictionary defines "specificity" as used in medicine and biology to mean: 'the narrowness of the range of substances with which an antibody, enzyme, or other agent acts or is effective'. Ms Boscato agreed that "specificity" means the graded ability to measure the analyte without interference from other substances causing an inaccurate result. High specificity means low cross-reactivity. Ms Boscato also said that the references in the specification to the range of specific, highly specific and monoclonal antibodies indicate that the patentee accepts that specificity, reflected in the word "specific" as used in the specification and the claims, is a relative term.

Embodiments and examples of the invention 51 The embodiments of the invention utilise the sandwich reaction and the competition reaction. In the sandwich reaction, the labelled reagent is a specific binding partner for the analyte. The labelled reagent, the analyte and the immobilised unlabelled specific binding reagent cooperate together in a "sandwich". Binding occurs because of the recognition of the reagent for an epitope (or binding site) on the analyte. In the embodiment involving a sandwich reaction (at page 4), it states that the two binding reagents must have specificities for different epitopes on the analyte. This suggests that the reagents should bind preferably to the analyte. However, in the embodiment involving the competition reaction (at page 4), the labelled reagent is the analyte itself, or an analyte analogue with identical specific binding characteristics to the analyte. That labelled reagent binds with the immobilised reagent. If the analyte is present in the sample, there will be competition between the analyte and the labelled reagent in binding to the immobilised reagent, so that there is a decrease in the intensity of the signal in comparison with the situation where there is no analyte. This does not import a requirement for the reagent to be mono-specific. In a competition reaction, the labelled reagent does not bind to the analyte. This requires specificity of the immobilised reagent but does not involve a concept of mono-specificity. In either reaction, the immobilised specific binding reagent in the second zone is said to be preferably a highly specificantibody and, more preferably, a monoclonal antibody. If the specific binding reagent for the analyte were necessarily mono-specific, it would not be necessary to state a preference for a highly specific antibody. 52 There are references in the specification to an "important embodiment" (at pages 7 and 8) where the carrier contains in the first zone a labelled highly-specific anti-hCG antibody and has immobilised in the second zone an unlabelled highly-specific anti-hCG antibody. The labelled and unlabelled antibodies are to have specificities for different hCG epitopes. If a specific binding reagent must be mono-specific, there is no room for degrees of specificity. Further, an "important alternative" in the same important embodiment is 'a fertile period device, essentially as described for hCG except that the analyte is LH'. 53 In an embodiment of the invention (at page 16) a labelled antibody having specificity for an epitope and a second antibody having specificity for a different epitope on the same analyte are used. As a given example of an analysis to which this can be applied, the analyte can be hCG and the reagents can be monoclonal antibodies to hCG. The specification goes on to state that an assay based on these principles can be used to determine a wide variety of analytes by choice of appropriate specific binding reagents. The analytes can be, for example, proteins, immunoglobulins, hormones, drugs or infectious diseases agents. 54 The specification describes how to produce certain examples of the invention. In the section describing the preparation of labelled reagents, the specification describes the process for coupling an anti-α hCG antibody to the dye sol label (at page 34). It goes on to state that: Due to the structural homology between the alpha subunits of hCG and LH, [an] anti-α hCG antibody can be used to detect LH in a cross-reactive immunoassay (at page 34). Thus, a labelled antibody may be prepared for use in an LH assay in an identical manner to that described for Example 1, using an anti-alpha hCG antibody. In the section describing the preparation of the reagent strip (at page 35), the specification provides that the immobilised protein can be a suitably selected antibody preparation such as anti-ß hCG, using a second (labelled) anti-hCG antibody in a sandwich format. However, the specification later provides (at page 36) that sandwich-type reactions may be performed for the detection of hCG in a liquid sample using an anti-hCG antibody as described earlier in the specification, that is, using an anti-α hCG antibody linked to dye sols, gold sols or coloured latex particles. It further provides that a similar embodiment can be prepared using LH instead of hCG. 55 As Inverness points out, the only difference between the MDS kits and this example in the first patent is that the antibodies are reversed in the MDS kits in that the anti-α hCG antibody is the unlabelled reagent and the anti-ß hCG antibody is the labelled reagent. Inverness says that the reverse use of the antibodies makes no difference in terms of determining whether or not there are two specific binding reagents in the MDS kits. 56 In the context of sandwich assays, the specification repeatedly uses the term specific binding reagent to describe the labelled reagent, for example: In one embodiment of the invention, the labelled reagent is a specific binding partner for the analyte. The labelled reagent, the analyte (if present) and the immobilised unlabelled reagent cooperate together in a "sandwich" reaction (at page 4). Another important preferred embodiment of the invention is the use of so called "direct labels", attached to one of the specific binding reagents. Direct labels such as gold sols and dye sols, are already known per se (at page 5). The only description in the specification of the preparation of a labelled reagent for hCG detection for use in a sandwich assay utilises an anti-α hCG antibody. It describes how an anti-α hCG antibody can be labelled with dye sol for use in a sandwich assay. The most obvious conclusion is that the specification describes an anti-α hCG antibody as a specific binding reagent for hCG within the meaning of claim 1. This use of this expression to describe a reagent which binds to the α-subunit of hCG, which it shares with the other glycoprotein hormones, argues against a meaning of mono-specificity. The anti-α antibody is specific for hCG in that it will bind to hCG in a specific binding reaction; it has specificity for hCG but it is not exclusively specific for that analyte. It will also bind to the α-subunit of LH and to the other proteins with that subunit. It has specificity for LH, as well as FSH and TSH and may be used to detect those hormones. Indeed, the specification states that the anti-α hCG antibody can be used to detect LH in a cross-reactive immunoassay. The specification recognises the existence of cross-reactive immunoassays and makes reference to antibodies that will cross-react with molecules other than the target antigen. That is, the reagents are not absolutely specific. 57 MDS seeks to overcome this exemplification of the anti-α hCG antibody by arguing that it was not provided as an example of a specific binding reagent. MDS argues that the body of the specification, consistently with the parent priority documents, does not limit the labelled reagent in the first zone to a specific binding reagent, although it always limits the unlabelled immobilised reagent to a specific binding reagent. It finds support for this from the use in the specification and parent priority documents of the phrase "labelled reagent", without using the word "specific" while the phrase "specific binding reagent" is always used to describe the unlabelled reagent. This, MDS says, is a deliberate differentiation between any binding reagent and a specific binding reagent, the latter meaning one that is mono-specific for the analyte. MDS says that the anti-α hCG antibody is an example of a labelled reagent which is not a specific binding reagent. It says that claim 1 is narrower than the specification in that it requires both the labelled specific binding reagent in the first zone and the permanently immobilised unlabelled specific binding reagent in the detection zone to be mono-specific. 58 In essence, MDS argues that claim 1 is not satisfied by the use of the exemplified assay involving the labelled anti-α hCG antibody. That is, of course, possible. However, it is equally likely, in my view, that the claim includes rather than excludes an exemplified embodiment of the invention. As there is an available construction that would include the exemplified use of anti-α hCG antibody as a specific binding reagent, the exemplification supports that construction. I do not accept MDS' submission that the specification deliberately differentiates between "labelled reagent" and "labelled specific binding reagent" with only the latter meaning a reagent mono-specific for the analyte. Rather, I accept Ms Boscato's evidence on the parent priority documents of the first patent, that the references to a "labelled reagent" in the context of a sandwich reaction is a reference to a labelled specific binding reagent such that the example of the labelled anti-α hCG antibody is an example of a labelled specific binding reagent. 59 The examples in the specification assist in clarifying the invention and the application of the terminology. The specification states that an assay based on the principles described can be used to determine a wide variety of analytes by choice of the appropriate specific binding reagent. The assays can be sandwich assays, for example for hCG, or competition assays. The reference in one embodiment to the fact that the analyte can be hCG and the reagents can be monoclonal antibodies to hCG suggests that the reagents are not necessarily monoclonal antibodies. 60 MDS looks to the efficacy of the device in identifying, exclusively, hCG. It points out that unless one of the binding reagents is specific only for hCG, the system will not differentiate between hCG and the other glycoprotein hormones. That is, the reagent must bind with the ß-subunit of hCG. MDS points to the definition of "specific" of 'capability of discriminating between analytes'. It says that, unless such a mono-specific reagent is used, the reagent is not so capable of distinguishing between hCG and other analytes in the sample. 61 The specification is not limited in its description to a test device for hCG. As examples of certain preferred test strip materials and reagents, the specification exemplifies the anti-α hCG antibody as an appropriate labelled reagent and the anti-ß hCG antibody as an appropriate immobilised unlabelled reagent for use in a sandwich assay for hCG. There is no example in the first patent which utilises two reagents each mono-specific for hCG. 62 The specification explains (at page 11) that 'the immobilised specific binding reagent in the second zone is preferably a highly specific antibody, and more preferably a monoclonal antibody. In the embodiment of the invention involving the sandwich reaction, the labelled reagent is also preferably a highly specific antibody, and more preferably a monoclonal antibody' (emphasis added). Highly specific does not mean mono-specific. It recognises that, while the reagent is thought specifically to target the analyte of choice, there is a possibility that it may also bind to another analyte. By directing the use of a highly specific reagent, the likelihood of cross-reaction is reduced. The patentee has used an expression that allows for a degree of specificity. 63 The degree of specificity concerns the number of different analytes with which a reagent will bind. If "specific binding reagent" already meant mono-specific, such as a monoclonal antibody, this description would be unnecessary and contradictory. Dr Sinosich acknowledged that, if "specific binding reagent" does mean exclusive specificity as advanced by MDS, a qualification that an antibody is "highly specific" is redundant. 64 MDS submits that "highly specific" contemplates analytes that will not have binding reagents that are mono-specific but this is negated by the use of the expression in the context of the detection of hCG, which has the unique ß-subunit. If the description in the specification is designed to encompass analytes that do and analytes that do not have mono-specific binding reagents, the repeated use of "specific binding reagent for the analyte" in that context is more likely to mean a reagent that binds the analyte in a specific binding reaction than a mono-specific reagent. Not all reagents will be antibodies or highly specific antibodies. As described in the specification, they are subclasses of "specific binding reagents".

The claims 65 Claim 1 does not differentiate in language between the "specific binding reagent" in each of the two zones, other than to specify that one is labelled and one unlabelled. MDS says that if the same expression or terminology is used for the binding reagent in each zone of the device, they must both have the same characteristics of mono-specificity. 66 The language of the specification is not consistent or rigorous. For example, the patentee has used the expressions "labelled reagent" and "labelled binding reagent". The specification seems to use "reagent", "binding reagent" and "specific binding reagent" somewhat interchangeably. In a sandwich assay a "labelled reagent" which does not bind to the analyte would be ineffective in carrying out the purpose of enabling detection of the analyte-reagent complex in the detection zone. It is apparent that the former expression is shorthand for the latter. This is reinforced by the language of claim 2. Claim 1 refers to a labelled specific binding reagent and an unlabelled specific binding reagent. Claim 2, which is dependent on claim 1, uses the expressions "labelled reagent" and "unlabelled reagent", clearly referring to the labelled and unlabelled specific binding reagents of claim 1. Other dependent claims include the shorthand description. This does not support MDS's submission that the specific binding reagent is a sub-class of the broader class of labelled and unlabelled reagents. 67 The way in which these expressions and "labelled specific binding reagent" and "unlabelled specific binding reagent having specificity for the analyte" are used in the patent provide support for Inverness' interpretation, supported by Ms Boscato, that the expressions are not used to describe a mono-specific reagent but one that binds with the analyte in a specific binding reaction. That is, the reagent is one that binds to that analyte, in the sense of pairing with the analyte. Inverness contends that "specific" is used to distinguish the kind of binding and that "specific binding" indicates just that: specific binding as distinct from non-specific binding. This is supported by the statement in page 1 of the patent that 'the present invention relates to assays involving specific binding, especially immunoassays', that is, assays involving specific binding reactions between the reagent and the analyte. This is in contrast to non-specific binding, with the example of that binding given in the patent of a reagent to nitrocellulose. The extra words "having specificity for the analyte" maydenote an extra requirement for the reagent in the detection zone, that it not only binds in a specific binding reaction but also that it has a degree of specificity for the analyte and, in that way, has the capability to distinguish between analytes. 68 It follows that claim 1 of the first patent requires the presence in each zone of a reagent that will bind to hCG in a specific binding reaction. That requirement is fulfilled by the labelled anti-ß hCG antibody and the unlabelled anti-α hCG antibody in the detection zone of the MDS devices.

Summary of the main reasons for the conclusion that the meaning of "specific binding reagent for an analyte" is not a reagent that binds only the target analyte but one that binds the analyte in a specific binding reaction 69 A first, untutored, lay construction might be to look to the word "specific" as an adjective describing the kind of binding reagent. This would be consistent with MDS' construction that the reagent is one that binds specifically to and only to that analyte. However, there are a number of important reasons to reject this untutored approach, which include: 1. The specification uses the expression "specific binding reagent", in context, compendiously. 2. The interpretation of the expression must take account of the range of subject matter of the specification and of the claimed invention. 3. The link in meaning and expression of "specific binding reaction" and "specific binding reagent" as used in the specification and by Ms Boscato. 4. The distinction between specific binding where a reagent binds to a specific site on the analyte (a specific binding reaction) and non-specific binding. 5. The concept, recognised in the specification, of degrees of specificity which is inconsistent with a meaning of mono-specific and the inconsistency between a mono-specific binding reagent and the references in the specification of the degree of specificity of that reagent for an analyte. 6. Examples in the specification of the claimed invention include anti-α hCG antibodies, which are not mono-specific for hCG, as labelled reagents to be used in sandwich assays. The labelled reagent in sandwich assays is consistently described as a specific binding reagent for the analyte elsewhere in the specification. 7. The evidence of and explanation by Ms Boscato as to the meaning of the expression, which I accept. 8. The use in the literature, as at the priority date, of the expression "specific binding reaction" as a compendious phrase, which supports Ms Boscato's construction. 9. The more limited construction of Dr Sinosich is one that may be appropriate in his particular area of expertise and in his own experience but that is not necessarily the construction adopted by other skilled workers, either in immunology or more broadly.

The second, third and fourth patents 70 The additional integer of the claimed device of the second patent does not affect the specific binding reagent or the construction of the term. Claim 1 of the second patent makes it clear that the labelled specific binding reagent can also participate in a competition reaction in the presence of an analyte. Grammatically, the claim is not well constructed in the expression 'the device also containing a labelled specific binding reagent for an analyte, or which can participate in a competition reaction in the presence of an analyte'. I accept Ms Boscato's evidence that the skilled reader would read this to mean that the labelled specific binding reagent can bind in a specific binding reaction with the analyte, that is, "be" for an analyte or can participate in a competition reaction in the presence of the analyte. As discussed above, the labelled analyte in a competition reaction can be the analyte itself. In the case of hCG being the labelled specific binding reagent, it can bind to both an anti-α antibody via its α-subunit and to an anti-ß hCG antibody via its ß-subunit. That is, it binds to more than one molecule and is not mono-specific. 71 This reinforces, for the purposes of the second patent, the meaning contended for by Inverness. The expression "specific binding reagent for an analyte" has the same meaning in the second patent as in the first patent. 72 The third patent, like the second patent, states that it incorporates the disclosure of the specification of the first patent. Claim 1 of the third patent requires a "reagent-impregnated carrier" and a labelled specific binding reagent and provides for the labelled reagent to become bound if the sample liquid contains the analyte. The claim does not specify the means by which the labelled specific binding reagent becomes bound. MDS accepts that the anti-ß hCG antibody used in the MDS devices is a labelled specific binding reagent within the meaning of the third patent. 73 The fourth patent cites the United Kingdom equivalent of the first patent as prior art. The fourth patent explains that the use of reagent-impregnated test strips in specific binding assays such as immunoassays has previously been proposed and that analyte present in the sample can participate in a sandwich or a competition reaction within the detection zone, with a labelled reagent. The invention of the fourth patent is described in terms of a mobile labelled specific binding reagent and an immobilised unlabelled specific binding reagent, which reagents are capable of participating in either a sandwich or competition reaction in the presence of the analyte. An additional integer is a macroporous body. The fourth patent uses the same meaning of the expression "specific binding reagent" as in the first patent, in that the reagent may bind not only to the analyte but also to other molecules. No different meaning to that of the first patent is suggested and the context makes it apparent that the same meaning is used, as supported by the explanation of Ms Boscato.

"Dry porous carrier" 74 The construction of the phrase "dry porous carrier" contained in the claims of all four patents is also in issue and is relevant to whether the MDS devices infringe the four patents. Claim 1 of the first patent defines the invention as containing 'a dry porous carrier which communicates directly or indirectly with the exterior of the casing such that a liquid test sample can be applied to the porous carrier…'. Claim 1 of the second and fourth patents also includes the essential integer of a dry porous carrier and claim 1 of the third patent includes the essential integer of 'a dry porous reagent-impregnated carrier, such as an assay strip'. 75 I shall consider the specification of the first patent. It is not suggested that there is any relevant difference in meaning in the specifications of the other patents. Inverness accepts that the claims of the second patent and the third patent do not regard the 'bibulous sample liquid receiving member' as part of the carrier and says that the fourth patent does not regard the 'macroporous body' or the 'porous receiving member' as part of the carrier. The main issue for the purposes of infringement is whether the dry porous carrier is limited to a single continuous piece of material. 76 Inverness' construction of the expression is simple: a dry and porous carrier is a carrier which carries, conveys or transports the liquid sample, whether it is a single strip or a number of strips stuck together, whether it is a single body or a number of discrete bodies. Inverness says that the specification focuses on the function of the carrier in carrying the reagent rather than on the physical form of the carrier. As described in the specification of first patent, in summary, the dry porous carrier:

• receives the sample, either directly or indirectly;
• carries within it the labelled specific binding reagent which is mobile when in the moist state;
• carries the immobilised unlabelled specific binding reagent; and
• contains the reagents positioned such that a liquid sample applied to the carrier can pick up the labelled reagent and thereafter permeate into the detection zone. 77 MDS contends that "a dry porous carrier" is a single continuous piece of material which:
• is dry and porous; and
• can carry (meaning support or bear) "within" it a labelled specific binding reagent and "on" it an unlabelled specific binding reagent; and
• can carry (meaning transport or convey) a liquid sample through the carrier when the sample is applied to it. 78 The MDS devices contain a number of dry and porous discrete pieces which, together, receive the liquid sample and carry the labelled and unlabelled reagents. There is porous material that receives the liquid sample, a separate "conjugate pad" (a small pink pad) being a dry porous body in which the labelled anti-ß hCG antibody is carried, and a separate nitrocellulose test strip on which the unlabelled anti-α hCG antibody is permanently immobilised. The sample permeates through these discrete pieces. Together, the discrete pieces work as described in the specification. A sample is applied, any analyte in the sample binds to the labelled specific binding reagent at one part of a carrier and the analyte/reagent complex is then carried to another part of the carrier where it is detected. 79 The specification does refer to the carrier material in the form of a strip or a sheet but only as a preferred embodiment or example (for example at pages 6, 12, 14), which suggests that it contemplates that a device according to the invention can incorporate a carrier consisting of two or more discrete bodies of porous phase material. For example, an important aspect of the invention is said to enable a directly labelled specific binding reagent to be used in a carrier-based analytical device, such as one based on a strip format, to give a quick and clear result (at page 6). Claim 9 of the first patent is a dependent claim which limits the dry porous carrier of claim 1 to a device in which 'the dry porous carrier comprises a strip or sheet of porous material'. Claim 1 is not so limited. 80 I consider it clear from the specification and the claims of the first patent that the phrase "a dry porous carrier" in the claims other than claim 9 is not limited to a single continuous piece of material, although a carrier in the form of a single strip may be a preferred embodiment of the invention as described in the specification. As used in claim 1, the dry porous carrier describes that part of the device which works to receive the sample and carry it through the two zones for labelling and detection. While a preferred embodiment of that carrier is a single strip or sheet, the claim is not so limited. 81 Accordingly, I find that the MDS devices contain a dry porous carrier within the meaning of claim 1 of the first patent. For the same reasons, I find that the MDS devices contain a dry porous carrier within the meaning of claim 1 of the second, third and fourth patents.

Bibulous sample liquid receiving member "within said casing" 82 Only the claims of the third patent contain the integer of a 'bibulous sample liquid receiving member within said casing to receive sample liquid applied to said application aperture'. In issue is whether "within" in this integer means only "wholly within" as contended by MDS or also "partly within" as contended by Inverness. It is agreed between the parties that if MDS' construction is correct, this integer is absent from QuickStream but present in QuickCard. 83 MDS relies on the Oxford English Dictionary meaning of the word "within", namely: 'in the inner part or interior, or on the inner side (of a receptacle or other material thing); inside, internally' to contend that the QuickStream sample receiving member is not "within" the casing because it protrudes from it. In answer, to support its construction that, in the context of the specifications, "within" does not require the sample receiving member to be wholly within the casing, Inverness relies on figures 8 and 9 in the specification depicting an embodiment of the invention with the sample receiving member protruding from the casing. 84 Relevant dictionary definitions of "within" provide for a meaning that includes penetration into the interior of an enclosed space (see Macquarie Dictionary online, Oxford English Dictionary online, Black's Law Dictionary (6th ed, West Publishing Co, 1990)). They also include definitions that necessitate being inside and not beyond the boundaries or limits of a space. As was said in Texas State Commission for the Blind v the United States 796 F2d 400 (Fed Cir 1986) at [92], the word is not without some ambiguity and can mean "a part of" as well as "inside". 85 An embodiment of the invention at pages 7 and 8 of the specification and another embodiment at pages 22 to 26 (see also figures 8 and 9) both clearly involve a sample receiving member which protrudes from the casing, that is, partly within and partly outside the casing. However, that does not necessarily mean that the claims, by using the expression 'bibulous sample liquid receiving member within said casing' include those embodiments. The claims can be narrower than the description in the specification. 86 In describing the position of the porous sample receiving member 506 depicted in figures 8 and 9, which protrudes from the casing, the specification does not use the word "within"(at pages 22-26). However, in describing the same embodiment, the patentee uses the word "within" to describe the position of the carrier strip 510 which is depicted in figures 8 and 9 as wholly within the casing, for example: …as long as the strip is held firmly in place within the housing… (at page 23) Member 506 therefore provides the sole route of access for the sample to the strip within the housing… (at page 25) In another embodiment where there is no protruding sample receiving member, the specification uses the words 'within the body' to describe a test strip which is depicted in figure 3 as wholly within the casing of the device (at page 20). 87 The use of the word "within" in the specification supports the definition contended by MDS that "within" means "wholly within" and the bibulous receiving member of the claims of the third patent must be wholly within the casing. Accordingly, the integer of a 'bibulous sample liquid receiving member within said casing to receive sample liquid applied to said application aperture' is present in QuickCard but not in QuickStream.

Porous material backed with transparent moisture-impervious material 88 Inverness alleges that QuickStream infringes claims 9 and 10 of the third patent. Claim 9 contains the integer: [the] porous carrier is a strip or sheet of porous material backed with a layer of transparent moisture-impervious material, said transparent layer being in contact with the inside of said casing adjacent said result observation aperture to inhibit ingress of moisture or sample liquid. 89 MDS contends that QuickStream does not contain this integer for the following reasons: 1. It does not have a single "strip or sheet of porous material" but a test strip made up of individual components. 2. It is not backed with a layer of "transparent moisture-impervious material", but rather with a strip of white vinyl which is not transparent. This white vinyl strip is also not adjacent to the observation apertures but is against the casing on the other side, opposite the apertures. 3. A very small transparent piece of material (the clear plastic strip) covers only the pink conjugate pad. However, the clear plastic strip is not adjacent the apertures, in that it is not directly beneath the apertures when the casing is closed, and also does not perform the function of inhibiting ingress of moisture or sample. In QuickStream, inhibition of moisture is achieved in a completely different way, by external plastic windows that form part of the casing. 90 Inverness contends that the clear plastic strip, which is in contact with the casing on the same side as the apertures, constitutes the integer in question. It submits that the word "backed" means no more than "coated" so that the impervious layer can be on top of or underneath the porous carrier because it has a functional meaning. I do not accept this contention. The claim uses "backed" which has a different meaning to "coated". 91 The white vinyl strip is not transparent and does not fulfil the requirements of the claim. The opposite side of the casing to the observation aperture does not equate to and is not encompassed by the words of the claim. In QuickStream, the clear plastic strip does not perform the function of inhibiting ingress of moisture or sample liquid through the aperture, as this function is achieved through the clear plastic windows built into the casing. The fact that, functionally but by different means, the MDS device achieves a similar result is not to the point. The patentee has specified the means by which its claimed device functions. 92 QuickStream is, in this respect, outside the scope of and does not infringe claim 9 of the third patent. As claim 10 is dependent upon claim 9, QuickStream does not infringe claim 10.

infringement GENERALLY, apart from consideration of validity

The first and second patents 93 The parties agree that claim 1 of the first patent is infringed by the MDS devices and claim 1 of the second patent is infringed by QuickStream if Inverness' constructions of "specific binding reagent for an analyte" and "dry porous carrier" are accepted. Based on my findings above, claim 1 of the first patent is infringed by QuickStream and QuickCard and claim 1 of the second patent is infringed by QuickStream.

The third patent 94 It follows from the meaning of "dry porous carrier" and "bibulous sample liquid receiving member within said casing" that claim 1 of the third patent is infringed by QuickCard but not by QuickStream. 95 It follows from the meaning of "porous material backed with a layer of transparent moisture-impervious material" that claims 9 and 10 of the third patent are not infringed by QuickStream.

The fourth patent 96 Claim 1 of the fourth patent contains an integer which is not contained in any of the other three patents, namely that the particulate-labelled specific binding reagent is retained in a 'macroporous body having a pore size of not less than 10 times greater than the maximum particle size of the particulate label'. Inverness says that the conjugate pad in each of the MDS devices constitutes the macroporous body within this claim. MDS does not dispute that the MDS devices contain a "macroporous body" per se but has put Inverness to proof of establishing the relationship between the pore size of the macroporous body and the particle size of the label. MDS did not adduce evidence of the pore size or the particle size of its devices.

Electron micrograph evidence 97 Inverness instructed Mr Furzeland, an electron-microscopist, to examine the MDS devices under an electron microscope and produce and examine the resulting electron micrographs. Mr Furzeland's evidence is that the maximum particle size of the direct label was of the order of 45 nanometres in QuickCard and of the order of 65 nanometres in QuickStream. This evidence is not challenged by MDS. 98 Mr Furzeland also gave evidence that from the images taken of the conjugate pad in the MDS devices he estimated that, although he saw smaller pores, the majority of the pores on the conjugate pad were greater than 200 microns (2.00 x 10-4 metres) in size. If this is correct, the average pore size would be greater than 200 microns. Ms Boscato read the same micrographs and gave evidence that the top view and the cross section view in combination allowed her to calculate the pores to be 50-150 microns for QuickCard and 40-110 microns for QuickStream. Inverness relies on this evidence to prove that the direct labels in the MDS devices are smaller, by a factor of about 1,000, than the average pore size of the conjugate pad, amply meeting the requirement in the fourth patent that they be at least 10 times smaller (a nanometre is 10-9 metres; a micron is 10-6 metres). Inverness says that any errors inherent in the estimate of pore sizes are amply compensated by the orders of magnitude in difference between the two figures. 99 MDS submits that Inverness' evidence fell short of proving that the MDS devices incorporate a macroporous body as defined in the claims. It challenges the evidence of Mr Furzeland on the basis that his use of Scanning Electron Microscope (SEM) images to calculate pore size is inaccurate and that a different device, a porometer, should have been used instead. MDS points to Mr Furzeland's concession in cross-examination that SEMs, unlike porometers, cannot give any accurate indication in three dimensions of the mean pore diameter in a material and that his use of a scalpel to cut the sample before he took the SEM images could have caused the fibres to move and possibly separate and thus affect the true measurements. 100 In reply, Inverness contends that although SEM images are not three-dimensional, pore size can be ascertained by the micrographs of the top view and cross-section views in combination, as Ms Boscato did. It further contends that the porometer is a "red herring" because there is no evidence that a porometer was widely available at the priority date of the fourth patent or that the measurements should be made by an instrument that was then available. Inverness further points out that MDS chose not to adduce any evidence as to pore size, which could have been easily proved using the manufacturer's specification for its material. Inverness submits that the Court can infer that MDS could adduce no evidence that would support its argument that there was no macroporous body as defined in the claims in the MDS devices. 101 Inverness is alleging infringement. It is therefore for Inverness to establish that the MDS devices fall within the scope of the claims said to be infringed. 102 Claim 1 of the fourth patent provides for the relative pore size of the macroporous body without reference in the claims or the specification to the means of measurement. The criterion is objective. There is no reason to import a requirement that the measurement must be with any specific instrument. If an electron microscope image can used satisfactorily to establish pore size, then it is acceptable. This is a matter for evidence. 103 While Mr Furzeland accepted some error and some deficiencies of three dimensional measurements under an SEM, the claim does not specify three-dimensional measurement. Mr Furzeland and Ms Boscato measured the pore size in two dimensions from the micrographs. While that does not measure pore size along the length of the fibres, MDS has not established the degree of error, if any, to which these measurements should be subjected, nor that the skilled reader would understand pore size as referred to in the claim as other than a combination of top view and cross section view. Ms Boscato's understanding of the claim and her presentation of her evidence of pore size for the purposes of the claim as the skilled reader were not effectively challenged. I accept her evidence. 104 Inverness has not provided statistical evidence of acceptable error. Neither has MDS. The order of magnitude of the difference between the measured pore size and the maximum particle size is sufficiently greater than the 10-fold difference required by the claim to provide for the unquantified error that may be involved in Mr Furzeland's preparation for SEM imaging. Mr Furzeland maintained that the average pore size was 200 microns. 105 I am satisfied that the MDS devices contain a macroporous body having a pore size of not less than 10 times greater than the maximum particle size of the particulate label, within claim 1 of the fourth patent. It follows from this finding and my earlier findings on the construction of "specific binding reagent" and "dry porous carrier" that claim 1 of the fourth patent is infringed by QuickStream and QuickCard.

Email from the manufacturer of macroporous body in the MDS devices 106 Apart from the evidence of Mr Furzeland and Ms Boscato, Inverness seeks to rely on a representation contained in an email to prove the pore size of the macroporous body in the MDS devices. MDS objects to the admissibility of the representation. In light of my findings based on the SEM evidence, it is not necessary to consider the representation but I will nonetheless deal with its admissibility. 107 There is evidence that the macroporous body in the MDS devices (that is, the conjugate pad) is composed of a certain glass fibre grade specified in a confidential exhibit. I will refer to the grade as grade X. That was manufactured by a specified manufacturer (the manufacturer). Inverness' lawyers, through a Mr Raj, made enquiries to the general sales manager of the manufacturer regarding the pore size of glass fibre grade X. The sales manager replied by an email dated 28 February 2009 (the Email). 108 MDS objects to the admissibility of the Email as hearsay. Inverness seeks to rely on the business record exception to the hearsay rule in s 69 of the Evidence Act 1995 (Cth) (the Evidence Act). Section 69 relevantly provides: (1) This section applies to a document that: (a) either: (i) is or forms part of the records belonging to or kept by a person, body or organisation in the course of, or for the purposes of, a business; or (ii) at any time was or formed part of such a record; and (b) contains a previous representation made or recorded in the document in the course of, or for the purposes of, the business. (2) The hearsay rule does not apply to the document (so far as it contains the representation) if the representation was made: (a) by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact; or (b) on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact. (3) Subsection (2) does not apply if the representation: (a) was prepared or obtained for the purpose of conducting, or for or in contemplation of or in connection with, an Australian or overseas proceeding; 109 The Email is as follows: Hi Raj, Please find here below the technical information received from our Mount Holly mill. The information received from the Lab is as follows: Roughly 10+ years ago when we were looking into entering the hydraulic glass market, [grade X] was to be part of the product line we offered. Because the flow is so high on this glass grade, we gave it a micron rating of 40 - 50. This was based on porometer testing and multi-pass testing performed on this grade. I still feel confident stating that the retention of [grade X] is in the range of 40 - 50 microns. (the representation for the purposes of s 69) All the best, [Sales manager] 110 It does not seem to be disputed that the representation was made for the purposes of the manufacturer's business as it was a purpose of that business to answer enquiries made about their products. MDS' objection is that the representation was obtained in connection with an Australian proceeding for the purposes of s 69(3)(a) of the Evidence Act. Inverness submits that Mr Raj, who elicited the response from the manufacturer, did not cause the representation from "the Lab" 'to be made in the form which it takes' (Australian Competition and Consumer Commission v Advanced Medical Institute Pty Ltd (2005) 147 FCR 235 at [27] per Lindgren J) and, as he had no input into the form of the representation, Mr Raj was not relevantly the person who "obtained" it. Inverness says that the sales manager of the manufacturer was the relevant person who "obtained" the representation but that he clearly did not do so in connection with the present proceedings as he had no knowledge of these proceedings. 111 The Email is dated 28 February 2009. It was clearly elicited and sent in connection with the Australian proceedings. The representation contained in the Email is not a laboratory report of results of testing. It is the general sales manager's report of the recollection of someone in "the Lab" of test results of over 10 years ago. The information from the Lab was sought and obtained as a direct result of the request from Mr Raj made in connection with and for the purposes of these proceedings. 112 The exception to the hearsay rule provided for in s 69(2) of the Evidence Act does not apply by reason of s 69(3). The representation contained in the Email is not admissible for proving the pore size of the macroporous body in the MDS devices. The form of the representation is a summary of recollection and opinion also made in connection with the proceedings. Further, in its form and content, it accords with the rationale of unreliability which underlies subsection (3) (Advanced Medical Institute at [27] per Lindgren J). Even if it were admissible, it has in my view little or no probative value in view of its form and lack of detail. 113 Inverness further asks me to exercise my discretion under s 190(3) of the Evidence Act to order that the hearsay rule does not apply to the representation because the matter to which the representation relates is not genuinely in dispute. Inverness says that the matter is not genuinely in dispute because MDS has not put an affirmative case against it on the pore size of the macroporous body. MDS has put the proof of the pore size in dispute. Section 190(3) does not apply.

Applicable law 114 The first and fourth patents were filed under the Patents Act 1952 (Cth) (the 1952 Act) and granted under the 1990 Act. The second and third patents were filed and granted under the 1990 Act. It is not disputed that the validity of the first and fourth patents is governed by the 1952 Act (s 234(1) of the 1990 Act; Regulation 23.26(2) of the Patents Regulations 1991 (Cth)). It is not disputed that the validity of the second and third patents is governed by the 1990 Act.

Utility 115 The ground of lack of utility is couched in the same terms in the 1952 Act and the 1990 Act. The parties did not contend that a different test of utility should be applied to the different patents and made submissions on the utility of all four patents compendiously. Section 18(1)(c) of the 1990 Act requires that a patentable invention, so far as claimed in any claim, must be useful. It is for MDS, which asserts a lack of utility, to establish the ground of invalidity. 116 One test of utility is whether the claimed invention fulfils the promises of the specification, in that it does what was intended and claimed by the patentee, and whether the end obtained is itself useful (Advanced Building Systems Pty Ltd v Ramset Fasteners (Aust) Pty Ltd (1998) 194 CLR 171 at 187 for the first limb, Ranbaxy Australia Pty Ltd v Warner-Lambert Co LLC (2008) 77 IPR 449 at [144] for both limbs). MDS contends that both these limbs must be satisfied for an invention to be useful. Inverness contends that the only practical way to test utility is to determine whether the invention as claimed attains the result promised by the patentee, rather than to seek to assess general usefulness in a vacuum. 117 A principle has been expressed that all within the scope of a claim must be useful if the claim is not to fail for want of utility, so that a claim is bad if it covers something that will not produce the desired result, even if a skilled person would know which means to avoid it (WM Wrigley Jr Co v Cadbury Schweppes Pty Ltd (2006) 66 IPR 298 at [138] per Heerey J and authorities there cited). This was the test applied by the primary judge in Lundbeck and the parties did not dispute this test in the appeal in that case (Lundbeck at [217]). However, this principle does not mean that a specification should be construed in a way that any sensible person would appreciate would lead to unworkability when by construction it could be given a more limited meaning(Welch Perrin at 602 per Menzies J). The claims should be construed as they would be by the person skilled in the art desirous of making use of the invention (Martin Engineering Co v Trison Holdings Pty Ltd (1989) 14 IPR 330 at 338 per Burchett J; see also Austal Ships Pty Ltd v Stena Rederi Aktiebolag (2006) 66 IPR 420 at [227]-[239]). It has also been said that a claim does not need to specify a limitation that was common knowledge in the art for that limitation to apply in construing a claim to avoid want of utility (Austal Ships at [236] per Bennett J, citing Washex Machinery Corporation v Roy Burton & Co Pty Ltd (1974) 49 ALJR 12 at 18 per Stephen J). In Lundbeck (at [217]), Bennett J, with whom Middleton J agreed, affirmed the test as set out in Ranbaxy and Austal Ships. 118 The claims of the patents allow the reader to select which specific binding reagents to use in the device, although the specifications express preference for reagents such as highly specific antibodies and monoclonal antibodies. Where a claim omits a feature which, on a proper construction of the claim, is left for the reader to supply, the claim will not be invalid for want of utility if the feature is one that the skilled addressee could reasonably be expected to supply and the claimed invention is useful after the feature is supplied (Bodkin C, Patent Law in Australia (Lawbook Co, 2008) at [6080]; Rescare Ltd v Anaesthetic Supplies Pty Ltd (1992) 25 IPR 119 at 143 per Gummow J; appeal allowed but the Full Court did not consider utility). A similar approach should be adopted where a claim leaves a choice to the skilled reader to select features to include in the invention. In such circumstances, the fact that it is possible to make a purposeful selection of inappropriate features with the intention of making something useless does not imply that the claim lacks utility (Bodkin at [6070]; Martin Engineering at 338 per Burchett J). 119 In NV Philips Gloeilampenfabrieken v Mirabella International Pty Ltd(1992) 24 IPR 1, the claims of a patent for a lamp did not identify any particular phosphor to use when many phosphors within the claims, and phosphors improperly prepared, would not be useful for the stated purpose. Justice Wilcox, in obiter (at 37-38), considered that this did not render the claims invalid for want of utility because he found that a skilled addressee would know which phosphors have the necessary qualities to make them worth testing and would appreciate the necessity for proper preparation (affirmed in NV Philips Gloeilampenfabrieken v Mirabella International Pty Ltd (1993) 44 FCR 239 at 267 per Lockhart J, with whom Northrop J and, on this aspect of the case, Burchett J agreed). The subject matter of the invention is also important. In Abbott Laboratories v Corbridge Group Pty (2003) 57 IPR 432, the Full Court upheld a claim which included combinations of mediator compound, enzymes and substances of interest which do not work because the invention of the patent was a device (a sensor), not a chemical reaction or process. The Full Court considered that it was sufficient for the requirement of utility if the invention was effective in relation to some substances of interest. 120 In order to determine whether a claim is bad for lack of utility, it is necessary to construe the claim, understand the specification and consider any evidence on the usefulness, or lack thereof, of the invention. 121 The first patent asserts that the invention relates to analytical devices which:

• are suitable for use in the home, clinic or doctor's surgery;
• give a rapid analytical result requiring a minimum degree of skill; and
• adapt and improve known techniques, which enable determination of an analyte in a sample using labelled reagents and immobilised specific binding reagents, to provide diagnostic test devices suitable for home use which are quick and convenient. 122 The first patent describes features which enable a quick and clear result ideally discernable by the eye and which increase the probability of an observable result (at page 6). As to the "important embodiment" of a pregnancy testing device, the specification describes the use of a highly specific anti-hCG antibody in each of the first and second zones, with specificities for different hCG epitopes (at pages 7-8). The specification then states that 'the presence or intensity of the signal from the label which becomes bound in the second zone can provide a qualitative or quantitative measurement of analyte in the sample' (emphasis added) (at page 11). It also states that, by choice of appropriate specific binding reagents, an assay can be used to determine a wide variety of analytes (at page 17). The word "can" is repeatedly used to describe what the device can achieve. The specification also states that, by using the test strip materials and reagents as described, a device can be produced 'which is eminently suitable for use as a pregnancy test kit or fertile period test kit for use in the home or clinic' (at page 25). The fertile period test kit tests for LH. The specification also explains that, 'due to the structural homology between the alpha subunits of hCG and LH, alpha hCG antibody can be used to detect LH in a cross-reactive immunoassay' (at page 34). At a broader level, the invention achieves its purpose if the specific binding reagents are chosen such that, in combination, they are selective for the desired analyte. They must both bind with the analyte in a specific binding reaction but do not both need to be highly specific or mono-specific for that analyte. Ms Boscato considered that she and anyone skilled in art would be capable of selecting appropriate specific binding reagents to set up an assay which effectively detects the targeted analyte. 123 That is, the claimed invention of the first patent is an improved diagnostic test device, with the improvement not being in the ability to detect the analyte with greater certainty or with less cross-reactivity of the reagent, but in the speed and convenience of the test. The specification recognises that the operations involved in the prior art devices involve time and introduce the possibility of error and it is apparent that the devices of the first patent are intended to reduce the steps involved and thereby reduce error. There is no statement that error will be eliminated. There is no evidence that the known techniques which were to be adapted were of any particular sensitivity, that the specific binding reagents of the prior art devices were mono-specific or otherwise, or that there was no degree of cross-reactivity of those reagents. The first patent promises convenience of use. If the analyte is present, it will be bound; if sufficient analyte is bound, it will be detectable. The specification says nothing about false positives, false negatives, cross-reaction, accuracy or commercial success. 124 MDS contends that the test for utility has two parts: fulfilling the promise of the patent in that the claimed invention must do what was intended and the end result must be useful. MDS says that what is promised in the first patent and claimed in claim 1 is an analytical test device which will function as an analytical test device for the targeted analyte and, from that, accuracy is necessarily a promise. Without conceding whether some inaccuracy must be imported in any test device, MDS says that the degree of cross-reactivity by use of reagents in both the first zone and the detection zone that bind not only with hCG but also with hormones with the same α-subunit gives rise to unacceptable and non-useful inaccuracy in the detection of hCG that does not accord with the promise of the specification. 125 MDS also says a device that yields false positives and false negatives is not useful and that this is the case if "specific binding reagent" permits the use of a reagent that is not mono-specific to the analyte to be detected. False positive results may occur in a sandwich assay if neither the labelled reagent nor the unlabelled reagent is mono-specific for the analyte, so that another molecule in the sample can bind to both reagents and be detected. If the labelled reagent in the first zone is specific only for hCG, then only hCG will be labelled and able to be detected in detection zone. However, if the unlabelled reagent in the detection zone is not specific only for hCG, other hormones with equal or higher affinity, such as LH, will bind to it. The unlabelled reagent, having bound the LH, will not be available to bind with the labelled hCG which will then not be detected, giving a false negative. MDS says that its devices use scavenger molecules to bind with the LH to prevent this occurring. MDS says that the construction of "specific" for which Inverness contends and I accept, means that the claimed invention is useless in testing for the presence of hCG. 126 Both experts accepted in affidavit evidence that for a pregnancy test, it would not be clinically useful to have both antibodies in a sandwich assay, or the antibody in a competition assay, binding to the α-subunit of hCG, as that subunit is common to the other glycoprotein hormones, although Ms Boscato reconsidered this position during the hearing. The experts also agreed that it would be clinically useful to have the antibody of a competitive assay, or one antibody of a sandwich assay, that binds to sites other than the α-subunit of hCG, such as the ß-subunit of hCG which is unique for each glycoprotein hormone. They agreed that it is the ß-subunit that confers biological specificity and allows detection of the individual hormone. 127 However, during cross-examination, Ms Boscato said that a device constructed with anti-α antibodies in both zones would not be completely clinically useless because although there could well be a false positive result, there would be some utility as there would not be a false negative result. An absence of detection would correctly indicate an absence of pregnancy. While Ms Boscato accepted that, theoretically, there could be a false negative if there were high concentrations of the non-hCG glycoprotein hormones and insufficient reagent she said, and I accept, that the skilled worker would not devise an assay with insufficient reagent, to allow for that possibility. Ms Boscato conceded that use of the anti-ß antibody would result in a device that was more clinically useful but did not accept that a device using only anti-α antibodies lacked utility. 128 Further, even some anti-ß antibodies may bind to both hCG and LH as there are sites on the ß-subunits of hCG and LH which are common. That is, anti-ß antibodies may cross-react. It is apparent that there are degrees of cross-reactivity with the use of different reagents and that the possibility of a false positive or false negative result is inherent in the nature of the analytical tests. The patents do not contend otherwise. Further, the claims are not restricted to pregnancy testing devices but include devices to test for other reagents which may not have unique binding sites and for which cross-reactivity is a greater possibility. Dr Sinosich accepted that such test devices can still be useful in clinical or research work. 129 A test device constructed according to the claims and as understood by the skilled addressee has not been shown to lack utility. The fact that, in theory, one could construct a device according to the claims that, in certain circumstances, would not detect the analyte is insufficient to render the invention so far as claimed in the claims invalid for want of utility.

Sufficiency 130 The parties have proceeded on the basis that the test for sufficiency is the same under the 1952 Act and the 1990 Act. The test for sufficiency is whether the disclosure in each of the patents enables the skilled addressee to produce something within each claim without new inventions or additions or prolonged study of matters presenting initial difficulty (Kimberly-Clark at [25]). 131 MDS contends that, on the construction of "specific binding reagent for an analyte" that I have accepted, the first, second and fourth patents are invalid for insufficiency. It also contends that the third patent is invalid for insufficiency by virtue of the lack of limitation in claim 1 to a binding reagent in the detection zone that is a 'specific binding reagent for the same analyte'. 132 MDS contends that if the permanently immobilised reagent in the detection zone is not "specific" in the sense of being capable of distinguishing between analytes and preferably binding only to the target molecule with limited or no cross-reactivity with other molecules, scavenger molecules need to be used to remove or clean-up unwanted antigens or hormones which would otherwise bind to the immobilised reagent. Scavenger molecules would "soak up" molecules in the sample that are not to be tested, enabling the specific binding reagent to bind to and enable detection only of the desired analyte. Dr Sinosich gave evidence on the use of scavenger molecules to address the problems of cross-reactivity and false positives which would otherwise affect a device using reagents not mono-specific for the analyte. It is not disputed that, at the relevant priority dates, the use of scavenger molecules would have involved new invention or addition or prolonged study of matters presenting initial difficulty. MDS submits, in effect, that the claimed device of each of the patents is to test for an analyte with no cross-reactivity and no false positive or false negative results, so that a device within the claims is not possible in the absence of scavenger molecules. 133 The claims of the patents are not limited to devices which give no false positives and no false negatives. The test is not whether the specifications are sufficient to enable the production of such a device. The claims include devices which may give a false positive for hCG and may give a false negative for hCG. The specifications are sufficient to enable the production of such a device, which is useful even without the use of scavenger molecules. There is no evidence that the skilled worker could not make the inventions as claimed or that he or she would make a device that failed to detect an analyte. Ms Boscato said that she could set up an assay within the claims from what she was told by the patentee. Further, for the reasons given in respect of the claimed lack of utility, I reject the underlying premise in MDS' submissions that a lack of cross-reactivity is a necessary part of the invention. 134 MDS has failed to establish that the patents are invalid for a want of sufficiency.

Clarity 135 MDS contends that claim 1 of the second patent and claim 22 of the fourth patent are invalid for lack of clarity. Claims are required to define the invention clearly and succinctly so that readers can ascertain the precise extent of monopoly claimed. If a claim is ambiguous, the ambiguity may be resolved by reference to the body of the specification, failing which the claim is invalid (Nesbit Evans Group Australia Pty Ltd v Impro Ltd (1998) 39 IPR 56 at 94-95 per Lindgren J). 136 MDS contends that claim 1 of the second patent fails to comply with s 40(3) of the 1990 Act as the following words in bold are not clear or capable of any sensible meaning: the device also containing a labelled specific binding reagent for an analyte, or which can participate in a competition reaction in the presence of an analyte…. [emphasis added] 137 Inverness explains that this passage refers to two types of labelled specific binding reagents: a labelled specific binding reagent for an analyte, and a labelled specific binding reagent which can participate in a competition reaction in the presence of an analyte, such as a labelled analyte or a labelled analogue of the analyte. Ms Boscato gave evidence that she understood the words in that way. This explanation appears sensible and is consistent with the disclosures in the specification regarding competition reactions. 138 MDS also contends that claim 22 of the Fourth Patent fails to comply with s 40(2) of the 1952 Act as the word "having" is not clear in the following passage: the labelled antibody having freely mobile within the macroporous body and the porous carrier when in the moist state. [emphasis added] 139 In an almost identical passage in the body of the specification, the word "having" is replaced by "being". The sentence in claim 22 does not make sense and clearly contains a mistake. A reader wishing to clarify the meaning of the passage would go to the specification and immediately see that the word "having" should be read as "being". There is no relevant lack of clarity.

Priority date of the third patent 140 The third patent was filed as a divisional of the first patent. Accordingly, it takes the priority date of the first patent if it is fairly based on matter disclosed in the priority documents from which the first patent takes priority (s 79B of the 1990 Act; Reg 3.12(1)(c) and (2C) of the Patents Regulations 1991 (Cth)). If fairly based on the first patent but not on the priority documents, the third patent will take as its priority date the filing date of the first patent. The first patent claims priority from two Great Britain applications (GB 8709873 and GB 8800322) (Parent Priority Documents) with priority dates of 27 April 1987 and 30 October 1987 respectively. The filing date of the first Patent is 26 April 1988. 141 MDS contends that the third patent is not fairly based on the Parent Priority Documents or on the first patent such that the priority date of the third patent is its own date of filing, 21 May 1992. MDS asserts lack of novelty of the third patent by reason of a publication of 29 June 1989. This ground of invalidity can only succeed if the priority date of the third patent is its own date of filing. 142 In Lockwood Security Products v Doric Products Pty Limited (2004) 217 CLR 274, the High Court stated at [69] that the fair basing requirement in s 40(3) of the 1990 Act requires a 'real and reasonably clear disclosure' of what is then claimed. The High Court said that it is wrong to apply an 'over meticulous verbal analysis' and the comparison is not analogous to that between a claim and an alleged anticipation or infringement (at [68]). The correct analysis is whether 'the invention is broadly, that is to say in a general sense, described in the body of the specification' or whether it 'travel[s] beyond the matter disclosed' (Rehm Pty Ltd v Websters Security Systems (International) Pty Ltd (1988) 81 ALR 79 at 95 per Gummow J, quoted with approval in Lockwood at [69]; Synthetic Turf Development Pty Ltd v Sports Technology International Pty Ltd (2005) 67 IPR 475 at [26]; Lockwood at [57]). Disclosure is not limited to preferred embodiments set out in the specifications (Lockwood at [69]). These principles are equally applicable to determining whether the claims in a divisional patent are fairly based on matter disclosed in a parent patent or a priority document. 143 MDS asserts that claim 1 of the third patent and consequently each of the relevant dependent claims are not fairly based on the Parent Priority Documents or the first patent because they do not include the limitation that the unlabelled immobilised reagent of the detection zone be a specific binding reagent for the analyte. MDS submits that in each of the Parent Priority Documents and the first patent, the labelled reagent in the first zone is not limited to a specific binding reagent although a preferred embodiment contains that limitation, but the unlabelled immobilised reagent of the second zone is always required to be a specific binding reagent. 144 Claim 1 of the third patent relevantly requires the device to contain: a labelled specific binding reagent in the dry state in said device prior to use and which is released into mobile form by applied sample liquid…said porous carrier conveys said labelled reagent to said test result zone of said carrier wherein said labelled reagent becomes bound if said sample liquid contains said analyte. 145 That is, the claim provides for a labelled specific binding reagent in the first zone. A labelled specific binding reagent comes within the class of a labelled reagent and is fairly based. However, in the "test result zone", the claim of the third patent only requires that the labelled reagent "becomes bound" if the analyte is present in the sample and does not specify binding by a specific binding reaction between reagent and analyte.

Disclosures in the first patent and the Parent Priority Documents 146 Inverness contends that the specifications of the first patent and the Parent Priority Documents generally disclose a process whereby the labelled reagent becomes bound in the detection zone. Inverness refers to the sentences in bold in the following extracts from the specifications of the first patent, among others, as examples of such disclosure: The use of reagent-impregnated test strips in specific binding assays, such as immunoassays, has previously been proposed. In such procedures a sample is applied to one portion of the test strip and is allowed to permeate through the strip material, usually with the aid of an eluting solvent such as water. In so doing, the sample progresses into or through a detection zone in the test strip wherein a specific binding reagent for an analyte suspected of being in the sample is immobilised. Analyte present in the sample can therefore become bound within the detection zone. The extent to which the analyte becomes bound in that zone can be determined with the aid of labelled reagents… [emphasis is mine] (page 2) In one embodiment of the invention, the labelled reagent is a specific binding partner for the analyte. The labelled reagent, the analyte (if present) and the immobilised unlabelled specific binding reagent cooperate together in a "sandwich" reaction". This results in the labelled reagent being bound in the second zone if the analyte is present in the sample…[emphasis is mine] (page 4) 147 The sentences preceding the sentences relied on by Inverness clearly refer to the immobilisation of a specific binding reagent for the analyte. Inverness argues that the reference in each preceding sentence to a specific binding reagent merely indicates one means by which the analyte can become bound in the detection zone and does not limit the general disclosure in the subsequent sentence. Read in context, it is clear that it is the immobilised specific binding reagent which causes or results in the labelled reagent binding within the detection zone if an analyte is present. Inverness refers to evidence that at the priority date, ways for an analyte to become bound other than by use of a specific binding reagent were known in the field. However, Inverness has not referred to any parts of the first patent or the Parent Priority Documents which disclose another way for the labelled reagent to bind in the detection zone. 148 Inverness relies on the following passages from the Parent Priority Documents to provide a fair basis for claim 1 of the third patent: This results in the labelled reagent being bound in the second zone if the analyte is present in the sample… (Page 2 of GB8709873) …the presence of the analyte in the sample being determined by observing the extent (if any) to which the labelled reagent becomes bound in the second zone… (Pages 1 and 2 of GB8725457) Read in context, however, it is again clear that it is the immobilised specific binding reagent which causes or results in the labelled reagent being bound in the second zone as set out in these passages.

Fair basing on the Parent Priority Documents 149 Inverness says that the Parent Priority Documents are provisional specifications, which merely need to describe the invention generally and fairly and can be in a rough state and that the details of the invention may be developed to some degree in the final specifications (Anaesthetic Supplies Pty Ltd v Rescare (1994) 50 FCR 1 at 20 per Lockhart J). It argues that such development includes amending terms to describe broadly various embodiments already considered and described. 150 The Parent Priority Documents do not contain a real and reasonably clear disclosure of any way by which the labelled reagent may bind in the detection zone other than by use of a specific binding reagent for the analyte immobilised in the detection zone (Synthetic Turf at [28]-[29]). Unlike in Delnorth Pty Limited v Dura Post (Aust) Pty Limited (2008) 78 IPR 463, the method by which the labelled reagent binds to the detection zone is fundamental to the operation of the invention. The first sentence in all three priority documents states that the invention relates to "assays involving specific binding". 151 The Parent Priority Documents do not envisage or disclose a device that binds the labelled reagent/analyte complex in the detection zone by other than a specific binding reagent for the analyte. Claim 1 of the third patent is broader than the disclosure of the Parent Priority Documents. It follows that the claims of the third patent are not fairly based on the Parent Priority Documents and are not entitled to the dates of their filing. The earliest filing date available for the third patent is then the filing date of the first patent, if fairly based upon that specification.

Fair basing on the first patent 152 The third patent was filed prior to the expiry of three months since the publication of the acceptance of the first patent. Therefore, the question is whether the third patent is disclosed in the specification of the first patent as a whole (s 79B(1)(a) of the 1990 Act). 153 Claim 1 of the first patent requires a specific binding reagent for the analyte to be present in the detection zone as the unlabelled immobilised reagent. The specification makes repeated reference to the unlabelled specific binding reagent in the detection zone. It describes preferred embodiments in terms of the degree of specificity of that reagent. Read as a whole, the specification of the first patent is concerned with, discloses and describes devices in which the immobilised reagent of the detection zone is a specific binding reagent; the way in which the analyte becomes bound is by a specific binding reaction. 154 Claim 1 of the third patent does not contain that limitation. The class of devices of the third patent is wider than or, put another way, the invention as claimed in the third patent travels beyond, the disclosures and description of the specification of the first patent. 155 It follows that the earliest priority date of the third patent is the date of its own filing.

Legal principles 156 MDS attacks claims of the third and fourth patents on the ground of lack of novelty. For a claim to lack novelty, a prior publication must disclose all of the essential integers of the relevant claim. It must supply enough information to enable a person of proper skill in the art to apply the discovery without the need to conduct further experiments, other than ordinary methods of trial and error which involve no inventive step (Nicaro Holdings Pty Ltd v Martin Engineering Co (1990) 91 ALR 513 at 530 per Gummow J; Lundbeck at [173] per Bennett J, Middleton J agreeing). For the purposes of practical utility, the information given in the prior publication must also be equal to that given by the subsequent patent (Nicaro at 530 per Gummow J). Commonly, the only question is whether the prior publication describes the claimed invention with sufficient clarity and something less than a full description may be sufficient to establish want of novelty (Lundbeck at [173]).

Third patent 157 Inverness accepts that if the third patent takes priority from its filing date, Australian Patent No 619231(the Abbott patent) is relevant prior art for the purposes of novelty of the third patent. MDS contends that the Abbott patent anticipates claims 1 to 4 of the third patent. 158 Inverness does not contend that claims 1 to 4 of the third patent are novel over the Abbott Patent. Those claims should be revoked for want of novelty. Inverness submits that claim 9 is novel over the Abbott Patent but MDS did not have the opportunity to address the validity of this claim as Inverness only alleged infringement of claim 9 at the hearing. I have found above that claim 9 (and its dependent claim 10) is not infringed by the MDS devices.

Fourth patent 159 MDS alleges that claims 1 and 22 of the fourth patent are invalid for lack of novelty in light of the prior art information contained in the first patent. It is agreed that the validity of the fourth patent is governed by the Patents Act 1952 (Cth). In the amended particulars of invalidity filed on the last day of the hearing, MDS amended its particulars to rely only on anticipation by the first patent, which was fully argued, including in rounds of written submissions after the hearing. Inverness accepts that, in considering anticipation, the specification of the first patent is available under the 1952 Act to cite against the fourth patent on novelty. 160 The main contention regarding claim 1 of the fourth patent is whether the first patent makes sufficient disclosure of the following essential integer of that claim (the extra integer): Wherein prior to the application to the device of the liquid sample, the particle-labelled specific binding reagent is retained in the dry state in a macroporous body having a pore size not less than 10 times greater than the maximum particle size of the particulate label, through which macroporous body the applied liquid sample must pass en route to the porous carrier material, thus facilitating uptake of the particle-labelled specific binding reagent by the applied liquid sample. 161 Claim 22 is an independent claim which include the following integers:

• A bibulous urine receiving member; and
• A macroporous body, linking the porous nitrocellulose carrier and the urine receiving member, which contains a highly-specific anti-hCG antibody bearing a coloured particulate direct label. 162 MDS relies on the following passages in the specification of the first patent as disclosing the extra integer: Another important aspect of the invention is the use of a directly labelled specific binding reagent on a carrier material comprising nitrocellulose. Preferably, the nitrocellulose has a pore size of at least one micron. Preferably the nitrocellulose has a pore size not greater than about 20 microns. In a particularly preferred embodiment, the direct label is a coloured latex particle of spherical or near-spherical shape and having a maximum diameter of not greater than about 0.5 micron. An ideal size range for such particles is from about 0.05 to about 0.5 microns (page 6 lines 16 to 26) (the page 6 passage). If desired, a device according to the invention can incorporate two or more discrete bodies of porous solid phase material, e.g. separate strips or sheets, each carrying mobile and immobilised reagents (page 12 lines 7 - 10). Inverness points to the continuation of this passage in the specification: These discrete bodies can be arranged in parallel, for example, such that a single application of liquid sample to the device initiates sample flow in the discrete bodies simultaneously. The separate analytical results that can be determined in this way can be used as control results, or if different reagents are used on the different carriers, the simultaneous determination of a plurality of analytes in a single sample can made. Alternatively, multiple samples can be applied individually to an array of carriers and analysed simultaneously (page 12 lines 10 - 20) (together, the page 12 passage). 163 The fourth patent describes and claims a separate macroporous body. The macroporous body is a porous body of specified pore size. In order to understand the parties' positions on the meaning and scope of the expression "dry porous carrier" in the specifications it should be remembered that the MDS devices use as a carrier a series of dry and porous strips and, as part of the carrier, there is a pink conjugate pad which retains the labelled specific binding reagent in a dry state. Inverness alleges infringement of the first patent by reason of the functioning of the series of strips, including the conjugate pad, as a carrier and submits that it makes no difference whether the carrier is in a single strip or a series of strips, in one body or more than one discrete body. Inverness also asserts for the purposes of infringement of the fourth patent that the conjugate pad is a macroporous body within claim 1. 164 Inverness alleges infringement of the fourth patent by the MDS devices. In its submissions on infringement, Inverness has emphasised that the carrier material functions to permit the sample to travel from application to the device to the location of the labelled specific binding reagent (in the macroporous body) and then to the immobilised specific binding reagent for detection. 165 The parties adduced little expert evidence addressed to this aspect. Inverness contends that nowhere in the first patent does it disclose the extra integer of the fourth patent. It says that the page 6 passage neither discloses a macroporous body as a separate element nor says anything about the relationship between the pore size of the macroporous body and the particle size of the label. Inverness compares figures 9 and 10 in the first patent and figures 2 and 3 of the fourth patent, which are similar except that the latter discloses an extra rectangle representing the macroporous body, which is missing in the former. Inverness also contends that the page 12 passage does not assist MDS because it discloses a device containing two or more different carriers, each carrying a mobile and an immobilised reagent, such that the sample may flow simultaneously through each carrier, whereas the macroporous body in the fourth patent is a separate piece containing only the labelled reagent through which the sample passes before it reaches the detection zone. 166 Inverness submits that neither the macroporous body of claim 1 of the fourth patent nor the macroporous body and the bibulous urine receiving member of claim 22 of the fourth patent form part of the dry porous carrier. Inverness says that the first patent does not describe the macroporous body as a separate element and disclaims the macroporous body as part of the dry porous carrier in the fourth patent. Inverness relies on this disclaimer to deny anticipation of the fourth patent but for the purposes of infringement of the patents including the fourth patent, presses a functional characterisation of the carrier. In those submissions, Inverness said that the dry porous carrier included carriage of the labelled specific binding reagent. If the macroporous body is not a dry porous carrier, or part thereof, then the conjugate pad in the MDS devices is not part of the carrier. Both the macroporous body and the conjugate pad form an integral part of the carriage of the sample from application to detection. 167 MDS says that Inverness is "on the horns of a dilemma" because it seeks to argue that the MDS devices infringe both the first and fourth patents. To argue that the devices infringe the first patent, Inverness says that the pink conjugate pad found in the MDS devices which contains the labelled reagent is within the scope of the claims of the first patent. To argue infringement of the fourth patent, Inverness says that the pink conjugate pad is the macroporous body. MDS contends that this demonstrates that the macroporous body of the fourth patent is covered by disclosure in the first patent. MDS relies on the page 12 passage for the "broader statement" that the device can contain two or more discrete bodies of porous material, whether arranged in parallel or in sequence, and thereby discloses the separate macroporous body of the fourth patent. 168 It is possible for a device to infringe both a broader claim in an earlier patent and a narrower claim in a later patent without the earlier claim anticipating each of the integers of the later claim. The narrower claim may include additional features not disclosed in the earlier patent. The relevant question is whether the first patent sufficiently discloses the macroporous body in the fourth patent. 169 I have concluded that the "dry porous carrier" containing the labelled and unlabelled specific binding reagents referred to in the claims of the first patent is described in functional terms and is not limited to a single continuous strip, so that the integer of "a dry porous carrier" is satisfied by the pink conjugate pad containing the labelled specific reagent and the separate nitrocellulose test strip containing the immobilised unlabelled specific binding reagent which, in the MDS devices, function together to carry the sample. 170 I have accepted that the first patent contemplates a carrier made up of discrete bodies which together function to receive and carry the sample through the zones containing the labelled and unlabelled reagents. The page 6 passage, in setting out preferred pore sizes for the carrier and particle sizes for the label, discloses a carrier with a pore size not less than 10 times greater than the maximum particle size of the particulate label. The first patent also discloses a device, for example in claim 2, in which the labelled reagent is contained in a first zone of the carrier and the unlabelled reagent is immobilised in a detection zone spatially distinct from the first zone, the two zones being arranged such that liquid sample applied to the porous carrier can permeate via the first zone into the detection zone. 171 The macroporous body of the fourth patent forms part of the dry porous carrier. It is that part of the carrier containing the labelled specific binding reagent and through which the sample passes or is "carried". The dry porous carrier of the first patent is not limited to a single, continuous strip or sheet. The example in the page 12 passage in which separate strips each carry both the mobile and immobilised reagents does not limit the general disclosure of one or more discrete bodies forming the dry porous carrier, nor is it applicable to the macroporous body of the fourth patent or the conjugate pad of the MDS devices, as they contain only the labelled reagent and not the immobilised reagent. If Inverness relied on such a limited disclosure, the MDS devices would not infringe claim 1 of the first patent. Inverness relies on a 'wide, functional definition' of the carrier as being that which conveys or transports the sample along its entire length and which carries in the first zone the labelled reagent and in the second zone the immobilised reagent. It does not matter that the specification of the first patent does not disclose the macroporous body as a separate and distinct part of the carrier. It is encompassed within and sufficiently disclosed by the description of a dry porous carrier made up of more than one discrete part. It is in part for that reason that the MDS devices' pink conjugate pad, which is a distinct and separate part of the MDS device carrier, infringes claim 1 of the first patent. 172 Claim 1 of the fourth patent describes the macroporous body as the location wherein the labelled specific binding reagent is retained in the dry state prior to application of the liquid sample. The sample then must pass through the macroporous body "en route" to the porous carrier material, where the labelled reagent is freely mobile. That is, functionally, the sample is carried through the macroporous body where it is binds with the labelled reagent and then carried through to the second, detection zone. If Inverness' submissions as to the meaning of dry porous carrier for the purposes of infringement are accepted, the macroporous body is part of the dry porous carrier which functions to convey or provide a carrier for the sample from application to detection. The fact that it is a separate, discrete body does not affect this any more than does the presence of a number of discrete carrier pieces or the conjugate pad of the MDS devices. As MDS says, Inverness cannot have it both ways. 173 Inverness submits that the first patent makes no reference to the relationship between the pore size of the carrier and the particle size of the label. That is not so. At page 6, the specification of the first patent describes as an important part of the invention the use of a directly labelled specific binding reagent on a carrier material comprising nitrocellulose with a pore size of at least one micron and preferably not greater than about 20 microns. A preferred embodiment describes a direct label with a maximum diameter of not greater than 0.5 microns, with an ideal size range from about 0.05 to about 0.5 microns. Choosing a carrier within the pore size and a label within the particle size recommended in the first patent would encompass a carrier that satisfies the requirement in claim 1 of the fourth patent that the macroporous body has a pore size at least 10 times greater than the particle size of the label. 174 Claim 22 of the fourth patent contains a similar integer of a separate macroporous body, containing only a highly-specific anti-hCG antibody bearing a coloured particulate direct label. Inverness argues that the first patent does not disclose this integer, again because it does not disclose a separate macroporous body. Inverness did not raise an additional basis for novelty of claim 22. MDS provided detailed submissions identifying disclosures in the first patent of each integer in claim 22. I accept that all of the other integers of that claim are disclosed on pages 7, 8, 23, 24 and 26 of the first patent. 175 The first patent discloses a device with all of the integers of claim 1 and of claim 22 of the fourth patent. The disclosures of the first patent anticipate claim 1 and claim 22 of the fourth patent which, accordingly, lack novelty.

liability of dr appanna 176 The third respondent, Dr Appanna, is a director of both MDS NZ and MDS Aus. On the MDS website, he is described as the "Managing Director" and "Founder" of MDS, having founded MDS NZ in 1999. Dr Appanna also works as a family physician in Auckland, New Zealand. 177 At issue is whether Dr Appanna is personally liable for the infringement by MDS: 1. on the basis of being a joint tortfeasor; or 2. under s 13(1) of the 1990 Act on the basis that he "authorised" the conduct of MDS. 178 MDS accepts that if Dr Appanna is liable as a joint tortfeasor or pursuant to s 13(1) for the infringing acts of MDS NZ, it follows that similar findings should be made in respect of his role as a director of MDS Australia.

Joint tortfeasor 179 The parties have referred to the following three tests from the authorities which may be applied in determining whether a director is liable as a joint tortfeasor for acts committed by the company: 1. The test propounded by Lindgren J in Microsoft Corporation v Auschina Polaris Pty Ltd (1996) 71 FCR 231 at 246, namely whether the director 'directed or procured the infringing act' (the Auschina test) (applying Performing Right Society Ltd v Ciryl Theatrical Syndicate Ltd [1924] 1 KB 1 at 15 per Lord Aitkin). 2. The test first suggested by Finkelstein J in an obiter remark in Root Quality Pty Ltd v Root Control Technologies Pty Ltd (2000) 177 ALR 231 at [146], namely whether the director's conduct is 'such that it can be said of him that he was so personally involved in the commission of the unlawful act that it is just that he should be rendered liable' (the Root Quality test). 3. The test propounded in the Canadian case Mentmore Manufacturing Co Limited v National Merchandising Manufacturing Co In (1978) 89 DLR (ED) 195, namely whether 'the director made the infringing conduct his own in the sense that the director deliberately, wilfully or knowingly pursue[d] a course of conduct that was likely to constitute infringement or that reflected indifference to the risk of infringement' (the Mentmore test). 180 The Full Court has considered these tests but has not found it necessary to determine which test is the correct one (Allen Manufacturing Co Pty Limited v McCallum & Co Pty Limited (2001) 53 IPR 400 where both the Auschina and Mentmore tests were satisfied; Cooper v Universal Music Australia Pty Limited (2006) (2006) 156 FCR 380 where none of the three tests were satisfied). In Allen, the Full Court commented that the difference between the Auschina test and the Mentmore test may be more apparent than real as it was not aware of any cases in which the Auschina test was met but the Mentmore test was not met (at [43]). Justice Sundberg noted in Pioneer Electronics Australia Pty Ltd v Lee (2001) 108 FCR 216 at [46] that the 'clear preponderance of authority' favoured the Auschina test. After discussing the authorities at length, Redlich J of the Supreme Court of Victoria decided in favour of the Auschina test in Johnson Matthey (Aust) Ltd v Dascorp Pty Ltd (2003) 9 VR 171 at [200]-[201]. 181 MDS contends that the Mentmore test should be applied as it avoids the generality of the Auschina test which, it says, would render every active director personally liable for infringement by the company whether or not the director knows that the conduct directed or procured is infringing conduct. MDS submits that the Mentmore test should be applied because it is the only one of the three tests which truly has its genesis in a patent infringement case in which the question of the personal liability of a company director on the basis of joint tortfeasorship was fully ventilated and determined. It submits that the correct approach from Mentmore is that for personal liability to be found, there must be circumstances where 'the purpose of the director…was not the direction of the manufacturing and selling activity of the company in the ordinary course of his relationship to it but the deliberate, wilful and knowing pursuit of a course of conduct that was likely to constitute infringement or reflected an indifference to the risk of it' (Mentmore at 204 per Le Dain J as cited in King v Milpurrurru (1996) 66 FCR 474 at 496 per Beazley J). Under this test, directors would not be personally liable merely by imparting to the company the practical, business, financial and administrative policies which resulted in the selling of infringing articles; there must be that degree or kind of personal involvement by the director to make the tortious act his or her own (Milpurrurru at 495 per Beazley J). In Milpurrurru, Beazley J found the Mentmore test to be a more satisfactory approach to the question of personal liability of a director, at least in the case of a tort that involves a mental element (at 500). 182 For patent infringement, there is no necessary mental element. It is not necessary to show that a director, to be liable, knows that the acts which he or she procures or directs constitute patent infringement, as such a condition does not exist for patent infringement generally. The parties agree that even under the Mentmore test there is no requirement that the director knows or has reason to know that the acts which he or she directed or procured constituted infringement of another party's patent (Allen at [43]). 183 The apparent inconsistency is resolved if the mental element in the Mentmore test of 'the deliberate, wilful and knowing pursuit of a course of conduct that was likely to constitute infringement or reflected an indifference to the risk of it' relates to the pursuit of the course of the conduct and not to its characterisation. The question is whether Dr Appanna knowingly pursued a course of conduct which, judged objectively, led to infringement or was likely to constitute infringement, or reflected indifference to the risk of infringement. 184 The shares in MDS NZ are held by trustees for the benefit of Dr Appanna, his wife and their children. The shares in MDS Aus are held by a company of which Dr Appanna is the sole director. The shares in that company are held by Dr Appanna and his wife. I do not accept that the fact that Dr Appanna controls the MDS companies as shareholder, or the mere description of Dr Appanna as Managing Director are, alone, sufficient to establish that he directed or procured the infringing acts of the MDS companies. Dr Appanna's liability should be determined by reference to his involvement in the management and operations of MDS concerning the MDS devices. His shareholding of itself is insufficient to establish liability either as a joint tortfeasor or under s 13. Something more is necessary. 185 MDS's submissions are that while Dr Appanna played an important role in the day to day operations of MDS, he did not at any relevant time possess the acumen, ability or skill to determine by himself the strategic and business decisions adopted by MDS NZ. MDS points to Dr Appanna's qualifications as a general medical practitioner and emphasises that the expertise that he brought to the Board of Directors was his ability to understand the nature of the medical products to be sold by MDS. It was, MDS says, other directors of MDS NZ, being Mr Hills (a chartered accountant) and Mr Vallant (a solicitor) who brought critical and necessary skills to the management of the company. In addition, the day to day activities were managed by an Operations Manager until about March 2004 and thereafter by a General Manager. MDS emphasises that Mr Hills and Mr Vallant each attended board meetings and took actions within their relative areas of responsibility. While Mr Hills provided an affidavit in New Zealand proceedings, it is only Dr Appanna's affidavit that was read on this issue in the Australian proceedings. No evidence was called from Mr Hills or Mr Vallant. MDS points out that the strategic plan for MDS was not prepared by Dr Appanna and was determined by the Board. That plan outlined proposed responsibilities in the proposed business model and allocated certain responsibilities to Dr Appanna. Dr Appanna denies taking all of those proposed responsibilities, which included sponsorship, supplier relations, imports/exports, regulatory affairs and product sourcing. He says that his responsibilities as Manager Director have been to liaise with the General Manager on behalf of the Board and that he had occasionally been involved in supply relations and product sourcing. Dr Appanna says that he did not have responsibility for regulatory affairs, which was the responsibility of the Operations Manager and then the General Manager. Dr Appanna has been the director responsible for MDS' defence of the litigation commenced by Inverness in Australia and New Zealand and has, in part, personally funded that litigation. 186 MDS says that the evidence establishes that Dr Appanna 'was part of a suite of appropriately skilled personnel who managed and supervised the operations of MDS, both its day to day activities and the "higher level" strategic and business decisions'. MDS relies on Red Bull Australia Pty Ltd v Sydneywide Distributors Pty Ltd (2001) 53 IPR 481. At first instance, Conti J held that a director, although self-styled as the managing director and accepted by his Honour to be the decision maker of Sydneywide, was not liable as a joint tortfeasor with Sydneywide for passing off. In that case, Conti J accepted at [75] that the director was personally involved in such capacity in the process of design and the ultimate choice of design of the impugned packaging and was closely involved in the company's contravention of s 52 of the Trade Practices Act 1974 (Cth). His Honour found that not sufficient to render the director liable at common law as a joint tortfeasor, apparently on the basis that the company was a family company involving the director's two brothers and father in varying capacities. It was not, his Honour said, a "one man company" in the sense described in Auschina. On appeal ((2002) 55 IPR 354), Weinberg and Dowsett JJ at [160] described Auschina as a case concerned not with joint tortfeasors but with circumstances in which a director of a corporation will be held liable for its tort. Their Honours did not consider the director's liability because there was no pleading of the Auschina basis for liability nor an allegation that the director procured or directed the passing off by the company. Their Honours did observe at [164], however, that the evidence justified the inference that the director was knowingly concerned in the breach of s 52 and the inference that the director procured the passing off by the company. Red Bull does not assist MDS. 187 Even if Dr Appanna's explanation that the five responsibilities listed in the organisational chart in the business plan were only proposed responsibilities for him as Managing Director is accepted, Dr Appanna was the person to whom the General Manager reported within the organisational structure. Board minutes were prepared by Dr Appanna, often in his own handwriting and not distributed to the other Board members for approval. This shows a degree of informality consistent with a family business run by Dr Appanna. In the absence of evidence from Mr Hills and Mr Vallant of their roles on the Board of MDS NZ, the inference is open that they are limited to those of professional advisers within the areas of their expertise of law and accountancy. Dr Appanna's evidence is that they each carried out activities linked to their professions. Mr Vallant and Mr Hill are not directors of MDS Aus. There is no evidence that any director of MDS Aus other than Dr Appanna played an active role in the management of that company. 188 MDS did not develop QuickCard or QuickStream. They were supplied by an overseas manufacturer. From 2000, MDS acquired pregnancy testing devices from the product manufacturer, Phamatech and there is no evidence that Phamatech informed MDS of any allegations of patent infringement by its products. 189 Dr Appanna was aware of competitive products that were on the market, such awareness being at least since 1993. Dr Appanna's evidence is to the effect that he did not take an interest in the patents related to the products and was not familiar with patents in that field of activity. He was apparently not aware that those products bore a reference to the Inverness patents and I am not satisfied, from the evidence, that Dr Appanna was actually aware of Inverness' first three patents by reason of package warnings on either of the Inverness products "Clearblue" or "Clearview". Dr Appanna said that the question whether the products that MDS was intending to purchase from the manufacturer were covered by patents 'was something we never considered at the time'. 190 Dr Appanna was, however, the person directly involved in obtaining the distribution rights for MDS NZ to sell Phamatech products in Australia. Dr Appanna was directly and personally involved in obtaining regulatory clearance of the MDS devices in Australia as Managing Director of MDS and in correspondence with the Therapeutic Goods Administration. He was similarly involved in correspondence with Medsafe in New Zealand and was one of the "responsible persons" listed in an application for a Medsafe licence under New Zealand's Medicine Act 1981. He continued to be involved in the sourcing, supply and sale of QuickCard and QuickStream in Australia. Dr Appanna developed relationships with wholesalers and medical distributors on behalf of MDS NZ. He signed the document being an agreement with Apothecary Sales Brokers which granted Apothecary Sales Brokers a right to obtain orders for QuickStream and QuickCard from Australian customers on behalf of MDS NZ. Although Dr Appanna gave evidence that distribution in Australia was through the fourth respondent, the evidence does not support the fourth respondent being an arms-length distributor in so far as Dr Appanna was concerned. The fifth respondent, who was a co-director of MDS Aus with Dr Appanna until 2006, was also the sole director and shareholder of the fourth respondent. 191 Some of the actions of Dr Appanna took place prior to the actual importation, offer for sale and sale of infringing MDS devices in Australia. However, those actions enabled and procured the infringement of MDS. They were necessary preparatory acts to, and part of the process of, the importation and offer for sale of the MDS devices and the using of the devices for the purposes of sale. They are, therefore, relevant to Dr Appanna's liability. 192 I am satisfied that Dr Appanna's position as the Managing Director of MDS NZ and his participation in the procurement and distribution of the MDS devices in New Zealand and Australia are sufficient to establish that he deliberately, wilfully or knowingly pursued a course of conduct that resulted in MDS selling products that infringed the Inverness patents. Further, he was aware of competing products on the market and was indifferent as to whether or not those products were protected by patents. In taking part in the activities of MDS NZ and MDS Aus as a director and in the management of those companies, Dr Appanna directed or procured the obtaining of and the selling of the products that infringed Inverness' patents. Accordingly, he is liable under both the Mentmore test and the Auschina test.

Authorising conduct of MDS - s 13(1) of the 1990 Act 193 The "exclusive rights" of the patentee are the rights to "exclude" others from exploiting the invention or authorising another person to exploit the invention (Grain Pool of Western Australia v Commonwealth of Australia (2000) 202 CLR 479 at [83]-[85]). Infringement of the right to authorise exploitation in s 13 looks to whether the product being exploited infringes the claimed invention and not whether the person authorising that conduct intends to authorise infringement or knows that the product will infringe. There is no requirement that the person knows that the authorisation is of an infringement of a patent. 194 It is an infringement of the patentee's exclusive rights not only to exploit an invention but also to authorise another person to exploit it (s 13 of the 1990 Act). The word "authorise" in s 13 has the meaning in the comparable context of the Copyright Act (Bristol-Myers Squibb Company v F H Faulding & Co Ltd (2000) 97 FCR 524 at [97] per Black CJ and Lehane J; see also Rescare at 155 per Gummow J). A person authorises an infringement if he or she "sanctions, approves or countenances'" the infringement (University of New South Wales v Moorhouse (1975) 133 CLR 1 at 12 per Gibbs J, at 20-21 per Jacobs J (McTiernan ACJ agreeing); Cooper at [137]-[140] per Kenny J (French J agreeing)). As Burchett J said in Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty Ltd (1998) 42 IPR 111 at 129 (appeal allowed on validity, but not on infringement), s 13 at least embraces the case where a person 'made himself a party to the act of infringement' (Walker v Alemite Corp (1933) 49 CLR 643 at 658 per Dixon J). 195 MDS submits that the meaning of "authorises" in s 101 of the Copyright Act 1968 (Cth) (the Copyright Act) is irrelevant and not analogous to "authorise" in s 13(1) of the 1990 Act. MDS says that as s 101 of the Copyright Act defines a species of infringement of authorising another to perform an infringing act, "authorise" means 'sanction, approve, or countenance' because it is the infringer who is authorising another to perform the relevant acts although it has no legal right to do so. On the other hand, as the purpose of s 13(1) of the 1990 Act is to define the rights of the patentee, MDS contends that "authorise" in that section means 'to give legal or formal warrant to (a person) to do something' (one of several definitions from the Oxford English Dictionary Online) as this is what only the patentee has the right to do. 196 In Bristol-Myers Squibb Company v F H Faulding & Co Ltd (1998) 41 IPR 467 at 488, Heerey J, at first instance, discussed the meaning of "authorise" in s 13 of the 1990 Act. Justice Heerey considered that "authorise" in s 13 does not have the same meaning as "authorise" in the Copyright Act but rather has the meaning:

• 'To give authority or legal power to; empower (to do something)'from the Macquarie Dictionary; or
• 'To give legal or formal warrant to (a person) to do; to empower, permit authoritatively' from the Shorter Oxford Dictionary. Although Black CJ and Lehane J expressly disagreed on this point on appeal at [97] in obiter, MDS relies on the reasoning of Heerey J. 197 The latter aspects of the definitions in the Macquarie and Shorter Oxford Dictionary of "empower (to do something)" and "empower, permit authoritatively" do not support MDS's submission that "authorise" in s 13 is limited to the giving of legal authority. In any event, it is unlikely that s 13 can have that restricted meaning. The patentee has the right to exclude all others from authorising another to infringe the rights of the patentee. If authorisation required the legal right in the patent, then only the patentee has that right and there could be no infringement by authorisation by any person. 198 Interestingly, in Bristol-Myers Heerey J concluded, based on the definition he adopted, that mere supply of an infringing product with instructions for use did not constitute infringement but that the lease of a factory containing machinery the use of which infringed the patent did constitute infringement by authorisation. This does not support MDS. The acts of Dr Appanna relied on by Inverness go beyond mere provision of the opportunity to infringe and are analogous to the example that Heerey J gave of an act that did amount to infringement by authorisation. Dr Appanna's actions, in the context of his position with MDS, empowered the infringement. 199 MDS submits that the word "authorise" in s 13(1) is not relevant to the alleged liability of a director for infringing acts by a company and is not a concept that defines any infringing act by a third party. MDS submits that the different contexts of s 13(1) of the 1990 Act and s 101 of the Copyright Act have not been argued before and so were not properly considered by Gummow J in Rescare, by Burchett J in Kimberly-Clark or by the Full Court in Bristol-Myers. I do not accept MDS' argument that the different statutory contexts justify different meanings for the word "authorise" in patent and copyright law. As Inverness points out, the 1990 Act, unlike the Copyright Act, does not separately define the exclusive rights of the intellectual property owner and the acts which constitute infringement of those rights. Those acts which trespass on the patentee's exclusive rights under s 13 of the 1990 Act constitute infringement. Further, s 13(2) of the Copyright Act uses the word "authorise" in a similar way to s 13 of the 1990 Act to describe the exclusive right of the copyright owner to authorise a person to do particular acts. 200 MDS contends that a director can never be held liable for patent infringement on the "authorisation" ground because only the company can give the requisite warrant to invoke liability. It submits that a director cannot give such warrant to the company because of the distinction between the company as a separate, distinct entity and its directors who have an internal role in the management of the company. 201 Put together, MDS' submissions amount to saying that there can be no infringement by authorisation unless the authoriser is in such a position or such a relationship with the person being authorised that the authoriser has formal authority, in a technical sense, to authorise that person to do the infringing act. If that submission is that only the patentee has the right to authorise exploitation of a patent, it would follow that no person or company other than the patentee can grant the legal right to another to exploit the invention. This construction of "authorise" does not accord, in my view, with s 13 or the scheme of the 1990 Act, including s 117, or the meaning of "authorise". To the extent that MDS is arguing that Dr Appanna could not have authorised MDS NZ or MDS Aus to infringe as he was a director without proper authority formally to authorise actions of the company, I reject such a submission. Section 13 does not carry that limitation. 202 I do not accept MDS' proposition that the position stated in each of Rescare, Kimberly-Clark and by the Full Court in Bristol-Myers should not be followed. I see no reason to construe "authorise" in s 13 in the narrower way contended for by MDS. That is not to say that a director of a company, by reason only of that position, authorises any act of infringement by the company. It is still necessary to show actions that demonstrate that the person did sanction, approve or countenance the act of infringement. 203 There can be no dispute that Dr Appanna knew that the infringing act of the sale of the MDS devices would occur. He had the power to prevent those acts and some duty to interfere. Express or formal permission is not essential and inactivity or indifference may reach a degree from which authorisation or permission may be inferred (Australasian Performing Right Association Ltd v Metro on George Pty Ltd (2004) 61 IPR 575 at [19] per Bennett J). Dr Appanna authorised MDS to sell the infringing products. I am satisfied that he had the power to prevent the companies from committing the acts of exploitation (Metro on George at [18]). He arranged for the sourcing of the products and personally participated in the distribution of those products. Dr Appanna sanctioned, approved and countenanced the sale of products that infringed Inverness' exclusive right to exploit the invention of the first patent and the second patent.

MDS' CROSS CLAIM UNDER S 128 OF THE 1990 ACT 204 MDS has cross claimed under s 128 of the 1990 Act alleging unjustified threats of infringement proceedings. The parties agreed that the cross claim only arises if the MDS devices do not infringe any of the patent claims or the patent claims are found to be invalid. It follows that there is no need to deal further with the cross claim.

CONCLUSION 205 In summary, based on my findings above: 1. Claim 1 of the first patent is infringed by QuickStream and QuickCard. 2. Claim 1 of the second patent is infringed by QuickStream. 3. Claims 1 to 4 of the third patent are invalid for lack of novelty. The third patent has expired. 4. Claims 1 and 22 of the fourth patent are invalid for lack of novelty and should be revoked. 5. Dr Appanna is personally liable for the infringement of MDS Aus and MDS NZ as a joint tortfeasor. 6. Dr Appanna is liable under s 13(1) of the 1990 Act for authorising the infringement of MDS Aus and MDS NZ. I will direct parties to submit proposed orders to give effect to these reasons and any submissions on costs.

• I certify that the preceding two hundred and five (205) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bennett.