Intellectual Property Office of New Zealand - Patents Decisions
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Intellectual Property Office of New Zealand - Trade MarksLast Updated: 14 October 2008
P13/2000
IN THE PATENT OFFICE
IN THE MATTER of the Patents Act 1953
AND
IN THE MATTER of an application for Letters Patent No 313576 in the name of BERNARD CHARLES SHERMAN of 50 Old Colony Road, Willowdale, Ontario M2L 2K1, Canada
Applicant
AND
IN THE MATTER of allowability of the ground of obtaining by MERCK & CO., INC. of 126 East Lincoln Avenue, Rahway, New Jersey 07065, United States of America
Opponent
Hearing: 12 July 2000
J D Hardie for the Applicant
G F Arthur for the Opponent
DECISION OF AN
ASSISTANT COMMISSIONER OF PATENTS
Patent application no 313576, “the application”, was a PCT application with an international filing date of 30 July 1996 claiming priority from US patent application No 08/511297 dated 4 August 1995. The applicant and inventor was named as Bernard Charles Sherman, “the Applicant”
The Acceptance Notice on the application issued on 28 April 1999 and the acceptance was advertised in Patent Office Journal 1440 published on 28 May 1999.
In due course proceedings opposing the grant of letters patent were begun by Merck & Co Inc, “the Opponent”. A Notice of Opposition, Statement of Case and copies of documents cited in the Notice of Opposition and in the Statement of Case were filed with the NZIPO, “the Office” on 27 September 1995.
The opposition drew on the Patents Act 1953, Section 21(1)(a), (b), (d), (e), (f) and (g). For the purposes of these proceedings the important ground is (a), that of obtaining. This is ground 1 of the Notice of Opposition, to which paragraphs 8 to 13 of the Statement of Case relate.
In a letter dated 9 March 2000 the Attorney for the Applicant, asked the Commissioner to strike out ground 1 (obtaining) of the Notice of Opposition, including paragraphs 8 to 13 of the Statement of Case, as being an unsustainable ground of opposition. The ground is said to be unsustainable because, as Mr Hardie alleges, the Commissioner does not hear allegations of obtaining abroad.
The Attorney for the Opponent, in letters’ dated 13 March 2000 and 12 May 2000 opposed the Applicant’s application to strike out ground 1 (obtaining) and paragraphs 8 to 13 of the Statement of Case. The Attorney contends that, with a US District Court decision finding that Merck & Co Inc was the first inventor and that Merck publicly disclosed its process and ingredients prior to the priority date of the application, there is nothing to determine or investigate regarding allegations of obtaining abroad and the US District Court decision should be accepted and acted upon by the Commissioner.
In a letter dated 30 May 2000 the Office wrote to both parties saying the ground of obtaining should remain and be decided at the substantive hearing.
The Attorney for the Applicant requested an interlocutory hearing on whether or not the ground of obtaining should be struck from the Notice of Opposition, and both parties advised they would attend.
Another matter is to be decided at this time. In a letter dated 9 March 2000 the Applicant requested an extension of time to file its Counterstatement until three months after rendition of a decision relating to the obtaining issue in the case where the appeal period has passed without any appeal having been filed and otherwise three months after a final decision is reached, if the matter is appealed, determinative of that issue.
In a letter dated 12 May 2000 the Opponent noted that the time for filing the Applicant’s Counterstatement remains suspended.
The Applicant’s submissions
Mr Hardie submitted that the Commissioner has an inherent jurisdiction to strike out grounds of opposition that are unsustainable and a waste of time and resources. He quoted from Rhone-Poulenc SA’s (Ketoprofen) Patent [1989] RPC 570 including on page 573 at line 35 (Falconer J);
“First of all, there is the question of jurisdiction; that is to say, the question of whether or not there is jurisdiction in the Comptroller, and in this court on appeal, to stay proceedings before the Patent Office for matters such as an abuse of the process because the application or some proceeding set on foot before the Comptroller is frivolous or vexatious or obviously unsustainable for some other reason.” (emphasis added).
and at line 43
“I have no doubt that the Comptroller has inherent jurisdiction to prevent abuse of process of the proceedings before him by striking out or staying any particular proceedings in an appropriate case. The Comptroller acts in many matters, and in particular in proceedings such as the present, in a quasi-judicial capacity.’
I agree that I have the jurisdiction to strike out or stay on particular proceedings. Indeed I believe I have the duty to strike out or stay where circumstances require it.
I note that the words in bold above indicate the threshold for striking out or staying is high. I also note that in the decision referred to, on page 575 on line 16 Falconer J states:
“I pause here to say that, when dealing with the question of striking out or staying because of an abuse of process or because the proceeding is frivolous or otherwise obviously unsustainable, there is a heavy onus on the party seeking to strike out or stay. The expression used in respect of similar applications to strike out proceedings in the court, as a reference to the White Book shows, is “obviously unsustainable.”
I conclude that there is a heavy onus on the Applicant seeking to strike out in the present case.
Mr Hardie quoted from Du Pont de Nemours & Company’s Application [1965] RPC 58 where a similar point on the jurisdiction of the Commissioner, on page 583 at line 48 Lloyd-Jacob J states:
“Moreover, the Comptroller has power to require the deletion of an untenable ground at an early stage in the proceeding in order to avoid wasteful expenditure of time and money. These propositions are supported by the reported case of The Brush Development Company’s Application (1955) 72 RPC 31 to which Mr Tompkin directed my attention, and were accepted by Mr Walton.”
I agree.
Mr Hardie then submitted that the ground of opposition of alleged obtaining abroad is not sustainable because the Commissioner will not investigate allegations abroad and this has long been the law.
Mr Hardie referred to the New Zealand commentary on Halsbury’s Laws of England (Fourth Edition) Chapter 117 Patents and Inventions, Wellington : Butterworths 1988 p46 “Obtaining Abroad”. For “United Kingdom” substitute “New Zealand”.
and then to Halsbury’s Laws of England page 555:
“Allegations of ‘obtaining’ outside [New Zealand] will not usually be considered since importation is in itself “invention” (Re Edmunds’ Patent [1886] Griffin’s Patent Cases (1884-1886) 281; Re Bairstow’s Patent [1888] 5 RPC 286; Re Lake’s Patent [1888] 5 RPC 415; Re Higgins’ Patent [1892] 9 RPC 74; Re McNeil and Pearson Fire Alarm Ltd’s Application [1907] 24 RPC 680), but the case is different if the opponent can establish that he originated the invention in [New Zealand], and that the applicant or foreign communicator obtained it from him (ie provided, at least, that the original communication was made in [New Zealand] : see Re Dicker’s Application (1934) 51 RPC 392), whereas to obtain a sample of the invention by writing to a foreign manufacturer from [New Zealand] is obtaining and not invention (H’s Application [1956] RPC 197).”
I note the use of the words ‘will not usually be considered’ (emphasis added) at the beginning of the quote.
The leading authority for the Commissioner not investigating an allegation obtaining abroad is said by Mr Hardie to be Du Pont de Nemours & Company’s Application referred to above. He quotes from page 584 line 27, the words of Mr Field, the superintending examiner:
“It has long been the law that the importer of an invention is to be regarded as the “true and first inventor” for the purpose of the Statute of Monopolies and of the Patent Act [UK Act 1949] and that it is no part of the Comptroller’s duty to enquire as to how the importer came into possession of the invention abroad. ... That this restriction on the Comptroller’s jurisdiction applies also to convention applications has been decided in opposition proceedings on Curwen’s Application (1912) 29 RPC Appendix 1, being approved on appeal by the Solicitor General, Sir John Simon, (1913) 30 RPC 128.”
This appears to me to be strong argument for the Applicant’s request for striking out. Aspects of this case were considered by the Opponent and it will be referred to later in this decision.
Mr Hardie drew attention to Curwen’s Application (1913) 30 RPC 128 on which the Du Pont decision was based. Mr Hardie quoted from the Solicitor-General, on page 130 at line 16:
“[I]t seems to me that the Comptroller’s decision in this case is quite right, and that, neither in Convention Applications nor in ordinary Applications, is it open to an opponent to resist the grant of a Patent here by alleging fraud committed abroad.”
This decision was reached under the United Kingdom Patents and Designs Act 1907. I note that the Solicitor-General commented on page 129 at line 41:
“It certainly seems a curious thing, from some points of view, that a man who has defrauded an Opponent in a foreign country may then come to this country and get a Patent for this country which is not dated on the day of his Application here, but, by virtue of the Convention, is ante-dated to the date of his Application abroad.”
This indicates to me that the Solicitor-General had some unease at the practice.
Mr Hardie then submitted that in New Zealand law at this point in time the importer of an invention in the realm was to be regarded as the true and first inventor and the manner in which the importer, either domestic or convention applicant, obtained the invention will not be looked at.
Mr Hardie quoted from H’s Application [1956] RPC 197 on page 200 at line 44:
“[I]n each case the foreign inventor has performed the meritorious act, deserving of patent protection, of introducing the invention into this country.”
and at line 48:
“In Carez’s Application (1889), 6 RPC, at p.553, Sir Richard Webster said: ‘Mr. Thompson has said, and has rightly said, that for the purposes of the true and first inventor in England the sole point is who first brought the invention to this country. The grounds of the decision in Beard v Egerton and Chappell v Purday and in Worth’s case are the same, that in law the true and first inventor is the person who first publishes it through the Patent Office in England.’”
Mr Hardie quoted from Curwen’s Application [1912] RPC Appendix to Vol XXIX, No 17 (This is Notes of Rulings by the Comptroller-General 1912(A)) on page (i) at line 32:
“So far as original Applications are concerned, there is no doubt as to the state of the law. It has been held in numerous decisions (see, for example, Edmunds’ Patent, Griffin’s PC 281, and Meurs-Gerkin’s Application, 27 RPC 565) that the Comptroller has no jurisdiction to enquire into the circumstances under which an invention was obtained from abroad, and that an opponent cannot oppose the grant of a Patent on the ground that the applicant has obtained the invention from him – whether fraudulently or otherwise – outside the United Kingdom. This principle equally applies whether the applicant is merely the importer of the invention on a communication from abroad, or applies in the ordinary way as the “true and first inventor” in this country. The principle is founded on this consideration, viz., that since the date of the Statute of Monopolies it has been held to be a meritorious act, or at all events a permissible thing, to be the first to introduce an invention into this country, under whatever circumstances it was obtained from abroad.”
and at line 54:
“[T]he Applicant in this case is entitled to have his Application here considered as of the date of the Application in the foreign country, and if this is so, he will be on law – though by a legal fiction – the first importer or first introducer of the invention into this country, within the meaning of the doctrine already discussed.”
Mr Hardie stated that the Curwen’s Case was decided under the UK Patents Act 1907, but submitted the position remained the same under the UK Patents Act 1949, the latter Act being virtually identical to the New Zealand Patents Act 1953.
In support of this Mr Hardie quoted from the Du Pont De Nemours case referred to already, on page 586 at line 20:
“As the Comptroller there said, he has no concern with the true ownership of the first foreign application. It is the foreign applicant – whether or not he be the true inventor – or his assignee who has the right to apply under section 1(2) [UK Act 1949] and this mere rearrangement of the Act does not in my view necessarily conflict with the decision of the Comptroller in Curwen’s case that the Convention applicant is to be regarded as the true and first inventor by importation.”
and on page 587 at line 16:
“The decision in Curwen’s case has been on the books since 1913 and while as the Solicitor General said it certainly seems a curious thing from some points of view that a man who has defrauded an opponent in a foreign country may nevertheless keep to himself the consequent convention application in this country in my judgement Parliament have not in the 1949 Act either specifically or by necessary implication reversed the Solicitor General’s finding that “neither in convention applications nor in ordinary applications is it open to an opponent to revisit the grant of a patent hereby alleging fraud committed abroad.” Indeed by section 16(2) the fiction that an importer can for some purposes be regarded as the true and first inventor is, by clear implication, reserved.”
Mr Hardie submitted that the approach he described is well established and as an example referred to Ford Motor Company Limited (Cuskie’s) Application [1973] RPC 573 quoting the Hearing Officer, Mr Miram’s, on page 574 at line 31:
“It is of course, well established that the Comptroller should not take cognisance of allegations that the invention has been obtained abroad and that was acknowledged by the applicants in their agents’ letter dated 5th May 1972.”
I note that the practice of not investigating the matter of obtaining abroad is well established in the United Kingdom. Mr Hardie points out that as far as he is aware there are no cases in New Zealand dealing with the question of obtaining abroad.
Mr Hardie submitted that on an application to seal letters patent the grant of a patent should not be intercepted if there is any possibility at all of merit in the applicant’s invention.
He quoted from McLeod and McShain’s Application [1928] NZLR 604 on page 606 at line 39:
“[The Registrar] has, however, only to determine whether the patent applied for ought to be sealed. He in no way finally determines the validity of the patent. The patent may be attacked in an action for infringement, or in the appropriate proceeding for revocation of the patent.”
and from Beecham v Bristol-Myers (No 2) [1979] NZLR 629 on page 632 at line 48:
“The function of the Assistant Commissioner in dealing with an application of letters patent where opposition proceedings have been filed has been clearly laid down. It is to determine “shall there be a grant of the patent?” These proceedings are not intended to finally determine questions of validity of a patent if granted. Their purpose is to avoid the registration of patents that are clearly defective. If a patent is granted the opponent will still be entitled to apply to the Court for revocation or to seek revocation by counterclaim in an infringement action.”
I agree that I do not decide the validity of any patent to be granted and that the benefit of doubt goes to the applicant so that the matters can be dealt with in later appropriate Court proceedings if need be.
The Opponent’s submissions
Mr Arthur submitted that we are dealing at this hearing with an application to strike out the pleading of obtaining. We are not deciding whether there has been obtaining or what the law is. He submits all I have to decide today is whether the argument about obtaining can be advanced at the substantive hearing.
I agree that all I have to decide is whether or not the argument about obtaining should be allowed to be advanced at the substantive hearing.
Mr Arthur directed me to McGechan on Procedure and the High Court Rules and Commentary thereon, in particular Rule HR 186(a) Striking out Pleading
“186. Striking out pleading – Without prejudice to the inherent jurisdiction of the Court in that regard, where a pleading –
(a) Discloses no reasonable cause of action or defence or other case appropriate to the nature of the pleading; or
(b) ......; or
(c) ......, –
the Court may at any stage of the proceedings, on such terms as it thinks fit, order that the whole or any part of the pleading be struck out.”
Mr Arthur accepted that I have the power to strike out the pleading if appropriate and I agree I have that power.
Mr Arthur then directed me to commentary HR 186.05 and the criteria for deciding if HR 186(a) applies. The criteria are summarised under HR 186.05(l):
“(a) Assume facts pleaded are true: ...
(b) Causes of action clearly untenable: The causes of action must be so clearly untenable that they cannot possibly succeed. ...
(c) Jurisdiction exercised sparingly: The jurisdiction is to be exercised sparingly, and only in a clear case where the Court is satisfied it has the requisite material: ... The threshold appears to have come down since Abrahams Wool Exchange Ltd v Norlake Wool Ltd (1986) IPRNZ 101, where Quilliam J suggested the jurisdiction was to be used “very sparingly”.
(d) Difficult questions of law, requiring extensive argument – jurisdiction not excluded: ...
(e) Novel claims – duty of care: The Court of Appeal also acknowledged that the Courts should be very slow to rule on novel categories of duty of care at the strike out stage. Empirical evidence and other expert evidence ought to be properly tested, in helping the court make the right public policy choices. To similar effect Barker J held against the striking out of a claim in a developing area of law “on assumed facts and scanty pleadings ...”
I was then directed to HR 186.05(3) which contains some useful judicial observations by Master Williams QC. The observations include:
I understand that I should follow these rules and intend to do so. I note that striking out pleadings should be used sparingly. To be struck out the pleading must be such that it cannot possibly succeed.
Mr Arthur submitted that the facts pleaded have to be accepted by me for the
purposes of this interlocutory hearing. The facts include
that Mr Sherman had
nothing to do with the development of the invention claimed in Patent
Application No 313576; that the entirety
of the invention was disclosed by Merck
& Co Inc during Canadian court proceedings and uplifted by Mr Sherman for
the purposes
of his United States and subsequent New Zealand patent
applications. That this can be proven or otherwise in later proceedings is
a
separate issue. United States District Court decision Apotex Corp v Merck &
Co Inc. Case No 96C 7375, unreported, District
Judge Kennelly, 20 January 2000
determined that Merck & Co Inc were the first inventor in law and principles
of equity of the
present invention. I add that Apotex Corp is the assignee of
Mr Sherman in the United States for this invention.
‘
I accept that
these are the facts for the purpose of this hearing.
Mr Arthur submitted that the decisions of the English Court are loosely described as holding that the Comptroller cannot investigate an allegation of obtaining unless it is asserted that the invention has been obtained within the realm, and that none of those decisions are binding on the Commissioner of Patents in New Zealand, and a review of the statutory position and case law is appropriate.
I am not sure that I agree that they “loosely” describe as holding that the Comptroller cannot so investigate. The decisions before me seem to rather strongly suggest that the Comptroller cannot so investigate. I accept that United Kingdom decisions are not binding on me and are at best persuasive. As the matter of obtaining abroad appears not to have been raised before a hearing officer or a Court in New Zealand it may be that we need not blindly follow what happened in the United Kingdom, but that we need to analyse how the law can be interpreted to meet the needs of New Zealand in this more modern era.
Mr Arthur then introduced that Statute.
“Invention” means “any manner of new manufacture the subject of letters patent and grant of privilege within Section 6 of the Statute of Monopolies”.
Section 7 defines who may apply for a patent and in the case of a convention application that includes the basic applicant.
Section 21(1)(a) which provides a ground of opposition:
“That the applicant for the patent, or the person described in the application as the true and first inventor, obtained the invention or any part thereof from him, or from a person of whom he is the personal representative.”
Mr Arthur offered the view that he had been drafting this section and had he intended obtaining to be limited to obtaining in New Zealand he would insert the words “in New Zealand” after the word “obtained”. It would be the most simple of steps to make the statute clearly limited to New Zealand, but the statute is silent about where the obtaining takes place.
This would appear to be a reasonable point.
Mr Arthur then quoted section 23(2):
“the actual devisor of an invention or a part of an invention shall be deemed to be the inventor, notwithstanding that any other person is for any of the other purposes of this Act treated as the true and first inventor; and no person shall be deemed to be the inventor of an invention or a part of an invention by reason only that it was imported by him into New Zealand.”
Mr Arthur commented on this section in that it recognises by inference that there can be invention by importation. He accepted that invention by importation stands but submitted that in the modern situation it is quite inappropriate.
I agree that there can be invention by importation and that it may not be as appropriate today as it was in the past.
Mr Arthur submitted that the Patents Act 1953 directs enquiry as to whether the invention was obtained from the opponent, the Act makes no suggestion in its wording or its content that “obtaining” in Section 21(1)(a) is limited to obtaining in the realm, and that the contention that obtaining is limited to obtaining in New Zealand violates the statutory presumption that words should be given their literal meaning, and that this latter construction appears to be caused by the legal fiction of “invention by importation”. In support of this Mr Arthur directs me to Halsbury’s Laws of England, 4th Edition Reissue of 1995, paragraph 1470, ‘Presumption favouring literal meaning’.
I see nothing wrong with this commentary.
Mr Arthur began discussing the historical policy reasons for invention by importation by referring to The Law and Practice of Letters Patent for Invention by Lewis Edmunds, 2nd Edition by T M Stevens (1897). He quoted an extensive passage beginning on page 265. Jessel MR is quoted on page 266 as saying:
“It is difficult to say on what principle a person who did not invent anything, but who merely imported from abroad into this realm the invention of another, was treated by the Judges as being the first and true inventor. I have never been able to discover the principle, and although I have often made enquiries of others ... I could never get a satisfactory answer. The only answer was, “It has been decided, and you are bound by the decision.” But it is an anomaly, as far as I know, not depending on any principle whatever. It has never been declared by a Judge or authority that there is such a principle, and not being able to find one, all I can say is that I must look upon it as a sort of anomalous decision which has acquired by time and recognition a force of law.”
Mr Arthur submitted that the quote from Jessel MR shows that as long ago as 1878 there was concern about the policy which underlined invention by importation.
I note the text continues as follows placing the quotation by Jessel MR into context (and this was included in the passage read by Mr Arthur):
“It is submitted that the protection of those who have imported novelties is founded on grounds much less arbitrary than Sir George Jessel seems willing to allow. If it be true that the Statute of Monopolies (Sect. 6) does but preserve the common law in regard to the grant of monopolies for meritorious inventions (and the reasons for so supposing have already been stated (x)) the meaning of “invention” as used in the statute must be sought not in a modern dictionary, but in the old authorities; and the fact that in all the reported cases dated before or about the time of the Statute of Monopolies invention includes importation is reason for supposing that in the Statute of Monopolies invention includes importation is reason for supposing that in the statute, as at common law, the importer was always intended to receive the same protection as the new manufacturer.”
I agree that the policy has been questioned over time and has caused some concern, but that the policy was to encourage the development of new trade and manufacture in England.
Mr Arthur then referred to the famous Cloth Workers of Ipswich case of 1615 which refers to the man who “hath brought in a new invention and a new trade within the kingdom in peril of his life and consumption of his estate”. This seems to be the spirit on which invention by importation was originally based.
I agree that, historically, recognition was to be given to those who ran risks in order to bring back to England what were for England new inventions and new trades.
Mr Arthur submitted that the legal fiction enabled importers to obtain valid patents by describing themselves as the “true and first inventors”. With such inventions by importation the true devisor of the invention is not named as the true and first inventor, it is the importer who is so named. The early cases and their rationale for allowing “invention by importation” properly required travel and physical importation of the invention into England. The cases that allow invention by importation require actual importation of the device or the knowledge into England.
He went on to submit that the foregoing is an altogether different situation to a mere foreign applicant who (now) is allowed to file a patent application in New Zealand (or England) notwithstanding that they are an alien. He submitted the alien’s application (convention or otherwise) is not an invention by importation. It is simply an application by the true inventor (or his assignee). That, he submits, is confirmed by the fact that the inventor named in the Declaration of Inventorship of an application by an alien is not the person who transmits the patent specification to New Zealand but the actual devisor of the invention.
He submitted that with a true “invention by importation” the importer (“the man who hath brought the invention to New Zealand in peril of his life and consumption of his estate”) is named as the inventor. An application filed by an alien is simply a patent application in that person’s name and must meet the normal criteria. It is not an invention by importation and is not treated as such by the applicant. He submitted that the error in some of the English decisions is to equate convention applications with invention by importation when that is not the case.
I agree that the world has changed since 1615 when the Cloth Workers of Ipswich case was decided and that international travel is now very common and very safe. Communication can now, at the beginning of the 21st century, be instantaneous. It seems to me that the concept of first importer may have lost much of its significance. It could be said that the policy of allowing invention by importation was historically sound, but it seems to me it may have lost some of its significance today. I note that international convention allows aliens the same rights as New Zealand citizens to apply for patents in New Zealand. I don’t know that at this stage I should say that the convention applicant is not to be regarded as the importer into New Zealand. United Kingdom case law already mentioned indicates that he was to be so regarded.
Mr Arthur then looked at the case law beginning with the Attorney General’s decision in Edmunds’ Patent (1886) Griffin’s PC 281, which he says seems to be the founding decision on fraud abroad in relation to patent application in England which decided that one cannot deal with obtaining abroad. As reported in this case
“the law was well settled that a person importing into the realm an invention was the true and first inventor ... it mattered not under what circumstances he had obtained the invention abroad.”
The Attorney General therefor decided that the Comptroller had no jurisdiction to enquire as to the circumstances under which the invention had been obtained by the importer. Mr Arthur points out that the Attorney General had also in mind that in allowing the patent to be sealed any matter relating to alleged breach of contract or duty can be dealt with in a later Court, whereas if he denied sealing of the patent the matter was closed and some injustice may have been done. Mr Arthur submitted that with the present Hearing if I decide against the opponent an allowability of the ground of obtaining then the matter is dead whereas if I allow the ground to proceed the matter can be decided in a fully argued opposition environment.
Mr Arthur drew attention to a report in Feichter, 1882 No 2485 which forms part of the report of the Edmunds’ case.
In this case Mr Feichter obtained the invention in Minneapolis but the United Kingdom application was refused on the ground of obtaining abroad. From the discussion of the Attorney General in the Edmunds’ case it seems that the Attorney General regards the decision in Feichter as relating to a fraud in the realm in that Mr Feichter based his right to an application in England on the ground that he had been instructed to do so, when in fact he had not been so instructed.
It appears that these cases support the opinion that obtaining abroad is not to be investigated. Had Mr Feichter simply applied for the patent in his own name without claiming that he had been instructed by the inventor, presumably, he would have been entitled to the patent.
Mr Arthur directed me to Meurs-Gerkin’s Application (1910) RPC 565. This decision supports the idea that in the case of an English person bringing an invention back to England no enquiry is to be made as to how he acquired knowledge of the invention abroad. He adds that the details of the case are not those of a foreign applicant filing in England.
He then directed me to the Ruling by the Comptroller General 1912(A) (above). In this ruling the preliminary issue to be decided was whether the Comptroller has jurisdiction in the case of a convention application to hear and determine issues involving fraud committed abroad, or relating to the obtaining of an invention outside the United Kingdom. Mr Arthur admitted that the decision reached was that the Comptroller does not have that jurisdiction. But Mr Arthur drew attention to a passage in this ruling on page iii at line 40:
“In the case cited no allegations of fraud or of obtaining abroad were made, and the question of fraud committed abroad was not therefore before the Attorney-General. I should be prepared myself to give the words an even wider extension, provided the facts were clear, and were admitted on the documents or declarations before me. Thus, for example, if an applicant for a Patent here, claiming priority under the Convention, admitted in his declarations, or in the proceedings, that the invention was not his own, or that he had wrongfully or fraudulently obtained it from the Opponents abroad, I do not think I ought to hesitate to refuse him the benefits of the Statute. In such case I should be acting under the general power which the Comptroller ....”
Mr Arthur’s view was that the Comptroller was concerned with the difficulty of proving obtaining abroad. The Comptroller’s action indicates that if the applicant admits fraud then he cannot have the invention, but if he stays silent and does not admit to fraud abroad then he is entitled to the invention.
To me it is clear that the case does not allow investigation abroad. However the decision does appear to allow that provided the facts were clear and were admitted on the documents or declarations in full proceeding then the result may have been different. Such documents and declarations would only be likely to be presented in full proceedings so that may be what is necessary in such cases. I note at this stage the Applicant is denying obtaining, as indicated by Mr Hardie.
The only document provided so far in the present case is the US District Court decision (above). In this decision the Opponent was found to be the true and first inventor in the United States. The Court did not find that that the Applicant obtained the invention from the Opponent. The Opponent is presumably able to file more evidence that may prove that on the documents the Applicant obtained the invention abroad.
Mr Arthur referred me to the Du Pont case (above) on page 585 at line 29:
“As regards the difficulty of proving fraud abroad Mr Walton submitted that the Comptroller, by section 83(2) of the 1949 Act [section 96(2) to the New Zealand Patents Act 1953], is given the power of an Official referee “in respect of the examination of witnesses” whereas under the 1907 Act he merely had these powers in respect of requiring the attendance of witnesses for the purpose of giving evidence. Thus, Mr Walton submitted, extends the powers of the Comptroller to authorise the examination of witnesses abroad by commission. Mr Tompkin pointed out, however, that the effectiveness of such a commission would depend on the law of the foreign country concerned and there were certain countries in which this procedure would be quite ineffective. Mr Walton assured me that arrangements could be made for the opponents’ witnesses who had given evidence in legal proceedings in the United States Patent Office relating to United States application No 72279 to travel to London to give evidence before the Comptroller.
In my view there is considerable force in Mr Walton’s submission. The onus is upon the opponents to establish their case and while this task will be more difficult if the relevant events took place abroad, I am not satisfied that, in this present age, this would be impossible or would place an intolerable burden upon the applicants. Further the Solicitor General in Curwen’s case did not in terms support this part of the Comptroller’s decision, although, in view of the report, it was clearly drawn to his attention. Were this, therefore, the only ground on which the Comptroller’s jurisdiction was held to be limited, I should be inclined to find it insufficient.”
He submitted I would have no difficulty in determining what happened in the United States and there is no genuine obstacle at an evidential level on deciding that point.
I agree that the onus is upon the Opponent to make their case and that this decision now seems to indicate that, should they wish to do so, perhaps they should be allowed to present a case.
Mr Arthur then directed me that part of the Du Pont decision where Section 50(2) is discussed. This is equivalent to Section 59(2) of the New Zealand Patents Act 1953. In this section the word “obtaining” is used. It was suggested that in Du Pont to protect convention applications the word would also have to include “obtained abroad”. Mr Arthur submitted that this wider meaning of “obtained” must extend to “obtained” when used elsewhere in the Act, that “obtained” in Section 21(1)(a) [of the Patents Act 1953] should include “obtained abroad”. The hearing officer in Du Pont declined to construe United Kingdom Section 50(2), but stated that if the meaning was different this was not sufficient justification for departing from the decision of the Solicitor General in Curwen’s case.
It seems to me that included in this decision not to depart from the earlier decision was that it had “been on the books since 1913” and that Parliament in the 1949 UK Act did not specifically or by necessary implication reverse the Solicitor General’s finding that neither in convention applications nor in ordinary applications is it open to an opponent to resist the grant by alleging fraud committed abroad.
In Lloyd-Jacob J’s decision in the Du Pont case I note he concludes “obtained” must be construed the same in all oppositions whether with application it is an ordinary application or a convention application and that it must be construed as “obtained in this realm”. Lloyd-Jacob J does not devote much time to the word “obtained” as it appears in Section 50(2) dismissing the issue that the objection to lack of novelty (to which section 50(2) relates) cannot be suggested as material to the objection of obtaining. No reason is given as to why one should be viewed differently from the other.
This indicates to me that whilst a word should have the same meaning wherever it appears in an Act there may be contexts where it may have a different meaning. I am not convinced in this case that the word should have a different meaning.
Mr Arthur submitted also that in the Du Pont Appeal Tribunal decision, they have upheld the decision in Curwen but failed to distinguish between an invention by importation and application filed by an alien. All the English cases are said to be flawed with the same premise that they have not looked properly at the issue of invention by importation and what that means and whether a mere convention application is the same as invention by importation. And, he submitted, they are all flawed because they all go back to Edmunds’ case which was quite clearly a decision made on the basis of a hearing officer who felt he ought not to find against the Applicant because if he did so there would be no right of redress whereas if he did find for him the matter could be addressed in a full forum.
I note that if, in this case, the pleading is allowed to proceed to the substantive hearing it may well be necessary, as in the Edmunds’ case, not to find against the Applicant so that there is a later right of redress.
Mr Arthur submitted there is no particular hardship in determining whether the invention was obtained abroad.
I note that Mr Hardie objected on grounds of time and cost involved but I feel that this is reduced to some extent because the matter has been researched abroad by the parties in connection with the US District Court proceedings. In addition the onus of proving obtaining rests largely on the Opponent and that is where the major cost and hardship will lie, I believe.
Mr Arthur suggested that the Applicant will be no worse off if the ground is allowed to be pleaded whereas the Opponent is in a much worse position if it was concluded today that there can be no consideration of obtaining abroad.
Determination
Under High Court Ruling 186 on striking out pleadings I must be very sure that the pleadings have no chance of success. The standard of proof is made deliberately difficult to attain.
The United Kingdom case law above strongly indicates that the pleadings would fail. The UK decisions on obtaining clearly indicate that the obtaining abroad will not be enquired into and that applications by convention applicants are to be regarded as inventions by importation. As there is to be no enquiry into how the ordinary importer obtained the invention abroad there is to be no enquiry as to how a convention applicant obtained their invention abroad.
Decisions of United Kingdom Courts are at best persuasive on practice in New Zealand. We are not bound by the decisions. It seems to me that this enables a Court or hearing officer in New Zealand to evaluate how patent law is to be interpreted in New Zealand in the year 2000 to advance technological development in this country.
UK practice on patenting inventions stems from early times with people being encouraged to bring back ideas from abroad to improve and expand manufacture in the realm. In the early days travel was infrequent, time consuming, costly, and often dangerous as the Opponent’s submissions have indicated. The practice appears historically sound but it is not clear how relevant it should be now. The practice developed under these circumstances has extended into more modern times. I note that Mr Hardie believes invention by importation no longer applies in the UK under newer legislation.
Unlike the United Kingdom New Zealand does not have the benefit of newer legislation. However perhaps we can rely on the absence of binding decisions to decide what is the proper approach to take in New Zealand in the research and technological environment that exists today. I note that practice has developed in New Zealand and in the United Kingdom, over time under both the respective 1953 and 1949 Patents Acts. I note particularly that the definition of what is regarded as suitable subject matter for letters patents has developed during the times of these Acts to go far beyond what the actual words of the definition seem to indicate. It is possible to remain within the meaning of these Acts while interpreting the words of the Acts to fit the times.
The usefulness of invention by importation and its place and value in New Zealand, seems to be much diminished at the start of the twenty-first century. Travel is commonplace, technological innovators and manufacturers travel abroad regularly. One can envisage situations arising where, under “invention by importation”, technical experts visiting exhibitions abroad and gaining knowledge of new products and processes for New Zealand can be undermined by a technical expert returning to New Zealand early and filing an application in New Zealand as the first importer. A really fast thinking person might forego the penalties under Section 25 of the Patents Act 1953 and file an application in the host country and return to New Zealand to file an application in New Zealand claiming convention priority in the host country.
The situation is made more complex by electronic communication where databases and information of all kinds are available (the Internet included) at any suitably attached computer terminal in New Zealand. Those involved in technological development use these sources of information frequently. Information abroad is now very much, and immediately, information in New Zealand. As we are concerned here with intellectual property all the expert has to do is read the information to posses the information.
It seems to me that information in the public arena abroad is very often, and almost instantaneously, public information in New Zealand. It seems to me that care needs to be taken to protect what is public information being misappropriated to private use.
I note that in the Du Pont case above the allegation is that the inventor in the United States disclosed the invention in confidence at his laboratory in the United States on several occasions to representatives of the applicant company for the United Kingdom application. Ignoring the ethical considerations, which invention by importation appears to do, this would appear to be an ideal case of invention by importation. The invention was secret so it was not in the public domain. Hence, no one other than the real inventor, and certainly no one in the United Kingdom, was likely to have known of the invention. So the publication in the United Kingdom by the obtaining party had done the service to manufacturing in the realm that was hoped for under invention by importation.
In the present case, and I am assuming at this time that the facts are correct, the information alleged to be obtained was publicly made available in open court proceedings. I am not suggesting that this information became knowledge, public or otherwise, in New Zealand at that time, but there seems to me the possibility that much information made public abroad will quickly, or in due course of time, become public knowledge in New Zealand. This aspect concerns me and I feel that the availability of information abroad and how it reaches skilled readers in New Zealand needs to be explored.
I note also that the information in this case is said to have been made available publicly and this no doubt impinges on whether the information can be obtained in the sense required by section 21(1)(a).
To take a cautious position I would say that secret information abroad introduced into New Zealand by way of patent applications may not call for investigation as to obtaining abroad, but more public information abroad introduced into New Zealand requires some call for investigation given the communication environment that exists today.
I think we need to look back to the Statute of Monopolies, section 6 for guidance:
“Provided also and it be declared and enacted that any declaration before mentioned shall not extend to any letters patent and grant of privilege for the term of fourteen years or under, hereafter to be made, of the sole working or making of any manner of new manufactures within this realm, to the true and first inventor and inventors of such manufacturers which others at the time of making such letters patent and grants shall not use, so as also they be not contrary to the law or mischievous to the state, by raising prices of commodities at home, or hurt of trade, or generally inconvenient.”
In terms of information which is now available as a result of ease of travel abroad and the amount of information available at the fingertips of those sitting at computer terminals connected to databases and the Internet there seems to me to be a danger of monopolies being granted for technical developments that are in the public domain in New Zealand and these could be “mischievous to the state, by raising prices of commodities at home”, may “hurt trade” or may be “generally inconvenient.”
Maybe in this age inventions should be given solely “the true and first inventor and invention” as stated in the Statute of Monopolies, section 6.
The purpose of this hearing is to decide whether it is appropriate to strike out the pleading of obtaining at this stage.
I am not absolutely sure that the ground should be entertained . But at this stage I do not think I should rule that the ground be struck out in case there are situations where obtaining abroad would be mischievous to the state, or hurt trade, or be generally inconvenient. I intend to allow the pleading but I think the hearing officer at the substantive hearing should be presented with more submissions, if there are any, for and against the ground of obtaining abroad being allowable in a final analysis. As far as I see it there may be good reason for going against the large amount of persuasive case law that indicates that obtaining abroad cannot be entertained in some cases as least.
Decision
I have come to the finding that the ground of obtaining should not be struck out at this stage. There seems to me to be merit in fuller argument on the issue in the forum of a substantive hearing.
On the issue of extension of time sought I grant an extension of time to the Applicant to file a Counterstatement. The granted extension is of three months from the date of this decision. In the event that the decision is appealed, determinative of the issue of striking out the pleading of obtaining, the extension is of three months from the date a final decision is reached determinative of the issue.
The Applicant has twenty-eight days from the date of this decision to appeal the decision.
Costs
Neither party has mentioned costs and I take it the matter, as is normal, will be dealt with at the substantive hearing.
Dated this 1st day of August 2000
A Hazlewood
Assistant Commissioner of Patents
J D Hardie & Co for the applicant
A J Park for the opponent
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