New England Biolabs, Inc v F Hoffman-La Roche AG

REASONS FOR JUDGMENT 1 This proceeding is a further round in a dispute that was the subject of reasons that I published on 27 June 2001: see New England Biolabs Inc v Commissioner of Patents (2001) 110 FCR 357. The dispute concerns the question of whether the respondent, F Hoffman-La Roche AG ('Roche'), should be refused leave to amend, prior to grant of a patent, its complete specification, on the ground of the conduct of Roche prior to making its request for leave to amend. Amendment is opposed by the applicant, New England Biolabs, Inc ('NEB'), on the ground of alleged inequitable conduct on the part of Roche in connection with the prosecution of its patent application. NEB asserts that Roche, in order to advance the central assertion that its patent application related to a patentable invention, made a number of representations that Roche knew to be false and misleading. NEB asserts that such inequitable conduct was such as to disentitle Roche to the favourable exercise of any discretion to grant leave to amend as requested. 2 Roche is the assignee of patent application number 632857 ('the Application'). On 14 January 1993, the acceptance of the Application was advertised and, on 14 April 1993, NEB filed a notice of opposition. On 12 November 1997, a delegate of the Commissioner of Patents ('the Commissioner') made a decision upholding NEB's opposition in relation to certain claims in the complete specification but rejecting the opposition in relation to the balance of the claims. The delegate allowed Roche a period of 60 days to propose amendments to overcome problems identified in the claims that were successfully opposed. Roche, however, did not propose any amendments during that period. 3 Both parties appealed from the decision of the delegate in so far as it was contrary to the interests of the relevant party. On 28 April 2000, in giving a ruling on the admissibility of evidence in the course of the hearing of that appeal, I expressed my views as to the nature of opposition proceedings and an appeal under s 60 from a decision in opposition proceedings: see F Hoffman-La Roche AG v New England Biolabs Inc (2000) 99 FCR 56. As a consequence of that expression of views, NEB discontinued its appeal. However, in connection with that discontinuance, NEB undertook to apply for revocation of any patent granted on the Application within three days of grant. 4 In the original notice of appeal, Roche had foreshadowed an application to the Court for orders directing amendment of the complete specification. However, in the course of a directions hearing following the discontinuance, I tentatively expressed the view that the Court may not have power to direct amendment. Roche, therefore, abandoned its application for orders directing amendment and, instead, filed a request for leave to amend under s 104 of the Patents Act 1990 (Cth) ('the Act'). That request is the subject of the dispute that is now before the Court. The question of an order for the sealing of a patent was deferred until the question of amendment under s 104 was finally dealt with. 5 A delegate of the Commissioner granted leave to amend on 20 October 2000 and the proposed amendment was advertised on 9 November 2000. NEB filed a notice of opposition to the amendments on 9 February 2001. NEB also took proceedings in this Court under the Administrative Decisions (Judicial Review) Act 1977 (Cth) seeking to impugn the Commissioner's decision to grant leave to amend on the ground that the Commissioner's delegate failed to have regard to the alleged inequitable conduct. 6 That proceeding was dealt with in my reasons of 27 June 2001 in which I concluded that the Commissioner had no discretion to refuse to grant leave to amend on the basis of the conduct of Roche prior to requesting leave. I concluded that the Commissioner had no discretion to decline to allow the amendments requested on the basis of the conduct of Roche trying to make its request for leave to amend. I, therefore, dismissed the application by NEB: see New England Biolabs Inc v Commissioner of Patents (2001) 110 FCR 357. 7 After the amendments were advertised for opposition, and were opposed by NEB, Roche proposed further amendments, which included withdrawal of certain of the earlier proposed amendments. On 11 November 2002, the Deputy Commissioner advised that, while he did not accept Roche's submission that the proposed amendments did not materially alter the request, he was prepared to proceed on a particular basis to expedite matters if both parties consented. 8 On 5 March 2003, leave was granted to amend in accordance with the amended proposals. That direction was the subject of advertisement on 6 March 2003. There being no further opposition filed, the Commissioner's delegate then proceeded to deal with the amended amendments. 9 Before dealing with NEB's contentions, it is desirable to say something about the scheme of the legislation. That scheme is set out in my reasons of 27 June 2001, to the extent that it was relevant to the decision I gave at that time. The question presently before the Court, however, raises different issues. NEB has appealed, pursuant to s 104(7) of the Act, against the Commissioner's decision allowing the amendments. Shortly stated, NEB contends that, notwithstanding the determination that I made concerning the discretion of the Commissioner in dealing with the amendment request, there is, nevertheless, a discretion in the Court to refuse leave to amend on the hearing of an appeal under s 104(7). 10 Because the evidence that would be adduced in relation to such a question would be extensive, the parties asked that the Court determine a preliminary question separately from and prior to the determination of all other questions that would be raised in the appeal. That question is whether this Court has a discretion to refuse to allow an amendment request under s 104(1) of the Act in an appeal against a decision of the Commissioner under s 104(7), on the grounds set out in NEB's detailed comments of 21 August 2000 to the Commissioner on Roche's proposed amendments. In those comments, NEB raised its assertions of inequitable conduct on the part of Roche. 11 The question of amendment arises in several circumstances as contemplated by Pt 2 of Ch 10 of the Act. Section 104 deals with amendments by the Commissioner pursuant to a request made by an applicant for a patent or by a patentee. Section 105 empowers the Court to direct amendment in the course of any 'relevant proceedings' in relation to a patent. '[R]elevant proceedings' is defined in Sch 1 as proceedings for infringement or revocation or in which the validity of a patent is in dispute. 12 Sections 106, 107 and 108 empower the Commissioner to direct that the filing of a statement of proposed amendments for the purpose of removing grounds of invalidity. Section 106 applies where the patent has been granted, s 107 applies where a complete patent application has been made and s 108 applies where a patentee of a petty patent has applied for an extension of the term. Section 108 has no current application having been repealed in connection with the amendments to the petty patent scheme. 13 Roche's application was made under s 104. Under s 104(1), an applicant for a patent may ask the Commissioner for leave to amend the complete specification for any purpose. Section 104(2) provides that where an applicant asks for leave to amend a complete specification, the Commissioner must consider and deal with the request in accordance with the Patents Regulations 1991 (Cth) ('the Regulations'). Regulation 10.2 governs the manner in which the Commissioner is to consider and deal with the request. Section 104(3) provides that, subject to the Regulations, the Commissioner may allow an amendment subject to conditions. 14 Section 104(4) provides, in effect, that any person may, subject to and in accordance with the Regulations, oppose allowing an amendment. Regulation 5.3(4) provides that a person must not oppose the allowance of a proposed amendment of a complete specification except on the grounds that the amendment is not allowable under s 102 of the Act. Under s 104(5), the Commissioner must not allow an amendment that is not allowable under s 102. Section 104(7) provides that an appeal lies to the Federal Court against the decision of the Commissioner allowing a requested amendment. 15 An amendment directed pursuant to s 105 clearly involves the Court. Under s 109, an appeal lies to the Federal Court against a direction of the Commissioner under s 106 or s 107. Section 106 provides that, where the Commissioner is satisfied that a grant of patent is invalid on grounds that could be removed by appropriate amendments of the specification, the Commissioner may, in accordance with the Regulations, direct the patentee to file a statement of proposed amendments of the specification for the purpose of removing those grounds. 16 Under 106(4), if the Commissioner is satisfied that the amendments set out in a statement are allowable and would remove the grounds on which the patent is invalid, the Commissioner must allow the amendments. 17 Section 107(1) provides that, where the Commissioner is satisfied that there are lawful grounds of objection to the complete specification of a complete application, but that those grounds of objection could be removed by appropriate amendments, the Commissioner may, in accordance with the Regulations, direct the applicant to file a statement of proposed amendments for the purpose of removing those grounds. 18 Section 154(1) confers jurisdiction on the Federal Court with respect to matters arising under the Act. Section 160 provides for certain powers of the Court on hearing an appeal against a decision or direction of the Commissioner. 19 Chapter 10 of the Regulations deals with amendments. By reg 10.4, the Commissioner must refuse a request for leave to amend in the circumstances there specified. By reg 10.5(1), the Commissioner must grant leave to amend in the circumstances there set out. The only grounds mentioned in the Regulations for not allowing an amendment are that the proposed amendments are not allowable under s 102, unless the amendment is for the purpose of correcting a clerical error or obvious mistake. 20 The proposed amendments are not allowable under reg 10.3. The proposed amendments would not otherwise be allowable under the Act or the Regulations. That is, as I held in my reasons of 27 June 2001, the Commissioner does not have any discretion to refuse leave to amend on grounds other than those that I have just specified. As I have said, reg 5.3(4) provides that a person must not oppose the allowance of a proposed amendment of a complete specification except on grounds that the amendment is not allowable under section 102. That provision relates only to complete specifications, as does s 102. Section 104 generally, of course, extends to amendment, not only of complete specifications, but also a patent request and any other filed document. 21 NEB begins with the proposition, which is indisputable, that an appeal to the Court under s 104(7) is only an appeal in name. It is, in fact, an original proceeding, being the first judicial proceeding in relation to an opposition to amendment. In such an 'appeal', the Court is exercising the judicial power of the Commonwealth as a Court constituted under Ch III of the Constitution. NEB contends that, in considering an 'appeal' under s 104(7), the broad nature of the powers conferred on the Court under s 160 must also be taken into account. Those powers include: