Jonker v Platform Solutions Pty Ltd

Principles on the grant of an interlocutory injunction 13 In Samsung Electronics Co. Limited v Apple Inc. [2011] FCAFC 156 (Samsung), the Full Court of this Court recently had occasion to consider, at some length, the principles relevant to the grant of an interlocutory injunction in circumstances not dissimilar to this application. Among others, the Full Court identified the following relevant principles: (a) The power to grant interlocutory injunctive relief in patent infringement cases is conferred in general terms by s 122 of the Patents Act 1990 (Cth) (the Act) and s 23 of the Federal Court of Australia Act 1976 (Cth): see at [44]. (b) That power is, however, limited by the nature of the act which it is sought to restrain: see at [48]. (c) To secure such an interlocutory injunction, the applicant needs to show: (i) that there is a serious question to be tried or that the plaintiff has made out a prima facie case, in the sense that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief; (ii) that the plaintiff will suffer irreparable injury for which damages will not be an adequate compensation unless an injunction is granted; and (iii) that the balance of convenience and justice favours the granting of an injunction: see at [53]. (d) However, the second of these requirements, viz "irreparable injury", does not comprise a separate and antecedent inquiry to the third, viz the determination as to where the balance of convenience and justice lies: see at [63]. Instead, it is one of the matters which ordinarily needs to be addressed in the consideration of the balance of convenience and justice: see at [61]. (e) The questions whether the plaintiff has made out a prima facie case and whether the balance of convenience and justice favours the grant of an injunction are interrelated, rather than separate inquiries: see at [67]. (f) An applicant does not necessarily need to show that its case is, on balance, likely to succeed. However, the strength of that probability depends upon the nature of the rights the applicant asserts and the practical consequences likely to flow from the injunction it seeks: see at [51], [55] and [59]; (g) Where there exist serious consequences for the respondent flowing from the grant of the injunction, and the merits and questions of convenience are evenly balanced, the applicant will need to show "good prospects of success before imposing almost certain prejudice on the [respondent]": see at [51]. (h) In this respect, one important consideration is whether the grant or refusal of the interlocutory injunction will have the practical effect of finally determining the whole case. If that is the case, the Court will evaluate more closely the strength of the applicant's case for relief: see at [71]-[74]. 14 In this case, as in Samsung, Jonker is seeking an interlocutory injunction to prevent an alleged infringement of a patent. However, there is a significant difference between Samsung and this case in that there is no suggestion in this case that the grant of interlocutory relief will finally determine the whole case. As the principles set out above show, the absence of this factor necessarily lessens the burden on Jonker as the applicants. Moreover, for the reasons that follow, I do not consider this is a case where either the merits, or the questions of convenience, are evenly balanced. This reduces the persuasive burden for Jonker even further. 15 First, I will deal with the merits. That involves two aspects: the strength of Jonker's infringement claims and the strength of Platform Solutions' attack on the validity of the Patent. Fortunately, I do not consider this is a case where there is, at least on the evidence before me, even a prima facie case made out on the invalidity of the Patent. For this reason, I am not faced with the situation that confronted both Bennett J in Samsung at first instance ((2011) 284 ALR 309, [2011] FCA 1164) and the other judges her Honour referred to in her discussion at [30]-[36], of having to weigh competing prima facie cases of infringement and invalidity. On this point, it may also be noted that the Full Court (see Samsung at [86]) did not expressly reject or adopt the correctness of the approach taken by Jessup J in Interpharma Pty Ltd v Commissioner of Patents (2008) 79 IPR 261, [2008] FCA 1498 at [17], which approach Bennett J decided to follow. 16 In this case, Platform Solutions seeks to rely upon four examples of what it claims are prior art to show that the Jonker Mobile Light was anticipated. In that course, it relies upon s 7(4) of the Act, which provides: (4) For the purposes of this Act, an invention is to be taken to involve an innovative step when compared with the prior art base unless the invention would, to a person skilled in the relevant art, in the light of the common general knowledge as it existed in the patent area before the priority date of the relevant claim, only vary from the kinds of information set out in subsection (5) in ways that make no substantial contribution to the working of the invention. 17 It appears to be common ground that the priority date for the Patent was 4 September 2009. 18 The four examples of prior art put forward by Platform Solutions are identified in the affidavit by Ms Clare Cunliffe of Corrs Chambers Westgarth, Lawyers, as follows: (a) a JP Nelson light tower used by JP Nelson Pte Ltd of Singapore; (b) a JLG Skybright package used by JLG Industries Ltd of the United States of America; (c) an LRX Piranha mobile lighting system used by Mr Brian Dwight of Dwight Crane of the United States of America; and (d) a Bebee Mini light system used by Bebee Inc of the United States of America. 19 Beyond proffering some indistinct information sheets (annexed to Ms Cunliffe's affidavit), Platform Solutions has not attempted to provide any evidence going to the required comparison between the items described (briefly as they are) in paras (b), (c) and (d) above and any of the five claims contained in the Patent. Without such evidence, I do not consider I can begin to make any assessment as to whether those items comprise prior art for the purposes of s 7(4) of the Act. I do not, therefore, consider that Platform Solutions has made out any case for invalidity of the Patent, let alone a prima facie case, based on those three items. 20 However, in relation to the JP Nelson light tower described in para (a) above, Platform Solutions has attempted such a comparison by producing an affidavit by a Mr Paul Davis. Mr Davis is a patent attorney whose area of speciality is "mechanical and process engineering, manufacturing systems and materials handling". In his affidavit, Mr Davis attempts to make a comparison between the JP light tower, as described in the affidavit of Ms Cunliffe, and the five claims made in the Patent. 21 Before going to that comparison, it is important to note that, in her affidavit, Ms Cunliffe was forced to rely upon hearsay information provided to her by a Mr Siow Teocheng, who is a senior sales executive at JP Nelson Pte Ltd. Mr Siow Teocheng orally provided Ms Cunliffe with various pieces of information about the JP Nelson light tower and directed her to the JP Nelson website where she was able to obtain some press releases and an information sheet about that light tower. Ms Cunliffe explained in her affidavit that it was not possible to finalise and swear an affidavit from Mr Siow Teocheng in the time available. Nonetheless, this explanation does not overcome the hearsay nature of this evidence. 22 Given this background to the information contained in Ms Cunliffe's affidavit, it may not be surprising that Mr Davis' comparison between the JP Nelson light tower, as described in Ms Cunliffe's affidavit, and the claims in the Patent is replete with speculation. Some examples include the following: Claim 1D … Clearly, the JP Nelson Machine must have some form of drive which causes rotation of the pair of tracks …. … Claim 1I There are cables … which extend along the boom … of the JP Nelson Machine. I believe that these cables are connected from the generator … to the lights …. Claim 1J I have reviewed the specifications of Denyo generator … online and note that the Denyo Generator is formed from an internal combustion engine and a generator. In my experience, it is common to use the term "generator" is used to describe an apparatus that includes an internal combustion engine and a generator [sic]. For example, if you were to walk into "Bunnings" and ask for a generator, the apparatus that you would purchase would include an internal combustion engine and a generator. Claim 1K In my experience, it is common for wheels or tracks of large mobile vehicles to be driven using hydraulic motors. For example, most earth moving equipment is driven using hydraulic motors. Equipment that is driven by hydraulic motors typically use levers that control the movement of the vehicle. The JP Nelson Machine has levers … which are commonly used to operator [sic] vehicles which use hydraulic motors to drive the vehicle. I have also reviewed specifications and pictures of an Aichi Boom Lift SR121, which are annexed to Clare Cunliffe's affidavit. It appears from these pictures that the tracks of the Aichi boom are driven using hydraulic motors. Therefore, I believe that the JP Nelson Machine uses hydraulic motors driven by an internal combustion engine independently of said electrical generation means. … Claim 4 As stated above, the electricity communication means in the JP Nelson is in the form of a cable … which is used to supply electricity to the lights …. As the boom … extends, it is highly likely that there is some slack in the cable … to allow for the extension of the boom …. I think that it is highly likely that some tray or rack accommodates the cable as it folds and unfolds. In any case, I consider that the feature of a tray or a rack for the power cable does not substantially contribute to the working of the invention. Claim 5A I believe that the JP Nelson Machine is likely to have been a lifting apparatus which has been converted. Claim 5B I believe that the conversion of the JP Nelson machine would have required this step. Claim 5C It is not clear if anything was removed from the JP Nelson turret to attach the Denyo generator … and associated platform. However, if anything was removed then it must have had a weight and therefore operated as a counterweight. Therefore, if anything was removed from the turret prior to placement of the Denyo generator then the conversion of the JP Nelson machine required this step. Claim 5D I believe that the conversion of the JP Nelson machine would have required this step. Claim 5E The JP Nelson machine conversion has included the placement of a Denyo Generator … on the turret. It is likely that the Denyo Generator … is a counterweight as it is relatively heavy. The question [sic] to whether or not the Denyo Generator is a "suitable counterweight"? I believe that the Denyo Generator will assist in preventing the lighting apparatus toppling over and therefore can be considered to be a "suitable counterweight". 23 Reflecting the speculation contained in this comparison, Mr Davis concludes his affidavit with the following two statements: 9. I cannot tell from the materials provided to me whether the JP Nelson light tower contains a tray or rack mounted to the boom (as claim 4 requires), but I consider that this integer would not make a substantial or real contribution to the working of the invention. 10. I cannot tell from the materials provided to me whether the JP Nelson light tower contains every integer of claim 5, but I consider that this integer would not make a substantial or real contribution to the working of the invention. 24 Because of the hearsay origins of the information he relied upon and its highly speculative terms, I do not consider Mr Davis' comparison provides a reliable basis upon which I can make any proper assessment of the JP Nelson light tower as prior art for the purposes of s 7(4) of the Act. Furthermore, I do not consider that Mr Davis has demonstrated in his affidavit that he is "a person skilled in the relevant art" in the terms of that section. 25 For these reasons, I do not consider Platform Solutions has made out any case, much less a prima facie case, for the invalidity of the Patent. 26 On the other hand, I consider that Jonker has established a relatively strong prima facie case that Platform Solutions has infringed the Patent. This conclusion is essentially based upon what Mr Ely said to Mr Jonker during their telephone conversation on 18 November 2011. Before going to the content of that conversation, I should interpolate that the earlier conversation Mr Jonker had with the unnamed prospective employee (set out at [7] above) is, in my view, too vague and ambiguous to provide any evidence of infringement. However, that is not so in relation to the conversation of 18 November 2011 (set out at [10] above). That conversation shows, at least on a prima facie basis, that: 1. Platform Solutions was constructing a mobile light of the same kind as that constructed by Jonker. This can be inferred from Mr Ely's response: "I'm building one for a customer", to Mr Jonker's statement: "I hear you're building my lights now" (emphasis added); and 2. Platform Solutions was aware that Jonker held the patent for the Jonker Mobile Light. This can be inferred from Mr Ely's response: "Patents aren't worth the paper they're written on …", to Mr Jonker's statement: "You know we've got a patent on this". 27 In addition to these two inferences, it is highly significant, in my view, that despite having filed an affidavit addressing other aspects of this application, Mr Ely has neither sought to deny the conversation as recounted in Mr Jonker's affidavit, nor sought to qualify or explain it in any way. From this, I infer that Mr Jonker's account of the conversation is accurate. Furthermore, I consider this circumstance strongly supports my drawing the two inferences described above. 28 For these reasons, I consider Jonker has established a relatively strong prima facie case that Platform Solutions was constructing a mobile light of the same kind as that covered by the Patent and was thereby infringing that Patent. 29 Turning then to the balance of convenience and justice question, I consider it weighs heavily in Jonker's favour. On its side, Jonker points to the facts that it holds the Patent for the Jonker Mobile Light and it has invested approximately $800,000 into its research and development, in addition to the matters set out at [6] above. Mr Jonker also says in his affidavit that he plans to invest a further $200,000, approximately, in further design and engineering improvements to the system. By any measure, Jonker has therefore made a significant financial commitment to its Jonker Mobile Light system. Further, Mr Jonker says that he has received numerous requests from potential customers in Australia and some requests from entities in the United States of America. In these circumstances, Jonker submitted it should not have to run any risk of its business being damaged by Platform Solutions' competition when that competition is based on Platform Solutions' infringement of its patent. 30 On its side, the financial prejudice Platform Solutions claims it will suffer if the injunction is granted is comparatively small. In Mr Ely's affidavit, that prejudice is essentially limited to the profit Platform Solutions will forego from its $20,000 contract with SE Power Pty Ltd. And, even this comparatively small prejudice is largely dissipated because, if Jonker ultimately fails in these proceedings, Platform Solutions will recover any such loss under the usual undertaking as to damages Jonker has agreed to give as a condition of the grant of an injunction. In submissions, Mr Ryan, for Platform Solutions, also pointed to the loss of reputation Platform Solutions is likely to suffer by not being able to fulfil its contractual commitment with SE Power Pty Ltd. This prejudice is not specifically mentioned in Mr Ely's affidavit so I do not give it much weight. 31 However, it must be said Jonker's claims that it will suffer irreparable injury if the injunction is not granted is nowhere near as strong as the prejudice it has identified above. It revolves around a claim that, since Platform Solutions' mobile lights only cost $20,000 to construct, as against the Jonker Mobile Lights cost of between $200,000 and $250,000, they are likely to be less safe and sturdy. Based on this, Jonker claims that, if a Platform Solutions mobile light fails and causes injury to a worker in the mining industry, any company producing mobile lights for that industry is likely to suffer significant harm because such an incident is likely to lead to a ban being placed on all such machinery pending an investigation. It claims this will be so whether that machinery is produced by Platform Solutions, or Jonker. I should add that Mr Jonker said in his affidavit that hiring plant and equipment to the mining industry comprises a major part of Jonker's business. 32 Mr Ryan, for Platform Solutions, submitted these claims are both speculative and self-serving. I tend to agree. However, since the Full Court in Samsung at [61] has made it clear that irreparable injury is not a separate antecedent factor in the determination of the balance of convenience question, but a factor that has to be weighed up with all the others, I do not consider that the tenuous nature of Jonker's claims on this aspect, detracts from the overall weight of the prejudice it is likely to suffer if the injunction is not granted. 33 Taking into account the fact that the grant of this injunction will not finally determine this whole proceeding and weighing all these matters (above), particularly the relative strength of Jonker's prima facie case on infringement, the absence of reliable evidence to support Platform Solutions' case on the invalidity of the Patent and the significant imbalance in the financial prejudice Jonker is likely to suffer if the injunction is not granted, as against that of Platform Solutions if it is, I consider that it is just, in all the circumstances of this case, to grant the injunction sought by Jonker. 34 I will hear the parties on the terms of the injunction order. I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Reeves.