Current Australian Patent Litigation

The year 2023 marked the first decision by the Full Federal Court on the “new” sufficiency (or clear enough and complete enough disclosure) requirement under the “Raising the Bar” (RTB) regime since it was introduced in 2013. The decision provides welcome guidance on the new law, as well as insight into the Federal Court’s approach in drawing upon UK authorities and the view towards harmonisation across jurisdictions.

In other decisions, the Federal Court also provided guidance on clear and complete disclosure in the context of priority dates in ToolGen v Fisher, a reminder regarding the pre-RTB requirement of ascertainment for inventive step in Sandoz v Bayer and a rare decision on the infrequently used power to grant pre-action access to samples. The authors also provide an update on Patent Office decisions regarding medtech inventions following the High Court’s decision in Aristocrat.

The Full Federal Court affirms (and extends) the correct approach under the RTB regime

The RTB regime introduced higher standards for the validity of patents in Australia, with the intention of more closely aligning Australian law with that in the UK, Europe and the US.

Under the “old” law of sufficiency in Australia, a claim will be sufficient where the disclosure of the specification enables the skilled addressee, armed with the common general knowledge, to produce “something” within the claim “without inventions or additions or prolonged study of matters presenting initial difficulty”. That is, for a product claim, the skilled addressee need only be able to produce a single embodiment.

Under the “new” law of sufficiency in Australia, a specification must provide a “clear enough and complete enough disclosure”. This requires the skilled addressee to be able to perform the invention across the full scope of the claim without undue burden.

Jusand Nominees Pty Ltd v Rattlejack Innovations Pty Ltd [2023] FCAFC 178 (“Jusand (FCAFC)”) is the first appellate judgment of the Australian Federal Court to decide on the validity of a patent under the “new” law of sufficiency.

The lead judgment was given by Perram J, with whom Nicholas and McElwaine JJ agreed. The main point of contention between the parties centred on the application of a proposition stated by Lord Briggs of the UK Supreme Court in Regeneron Pharmaceuticals Ltd v Kymab Ltd [2020] UKSC 27, namely that “the requirement to show enablement across the whole scope of the claim applies only across a relevant range. Put broadly, the range will be relevant if it is denominated by reference to a variable which significantly affects the value or utility of the product in achieving the purpose for which it is to be made”.

In considering this proposition, Perram J referred to the decision by Birss J in Illumina Cambridge Ltd v Latvia MGI Tech SIA [2021] EWHC 57 (Pat). Like Birss J, Perram J considered that Lord Briggs’ proposition, while couched in terms of products, could also be applied to processes.

Perram J considered that the starting point to determine a “relevant range” is with the invention as claimed, although such an inquiry can, where appropriate, extend to consideration of the invention’s “essence or core”. The “essence or core” of the invention is distinct from the invention but is “closely related to the technical contribution and/or the inventive concept”. Perram J found that although Jusand had correctly identified what makes the invention, a “Safety System” for protection against falling drill rods in underground mining, inventive, it had failed to take into account the technical contribution to the art. His Honour considered that once the technical contribution is taken into account, it can be accepted that the range of materials from which the Safety System may be made is part of its essence or core. In applying Lord Briggs’ proposition in Regeneron, as explained by Birss J in Illumina, Perram J considered that the range of materials from which the Safety System may be made to be a relevant range. The specification only disclosed how to construct the Safety System using steel but the claimed invention was not confined to any particular materials. The evidence was that once a material other than steel was selected, the skilled addressee “would basically need to invent the Safety System from scratch”. Thus, his Honour found the claims invalid for lack of sufficiency.

It follows from Jusand (FCAFC) that the Full Court has not only affirmed the approach to assessing sufficiency set out by Burley J in Cytec Industries Inc v Nalco Company [2021] FCA 970, but also imported into Australian patent law from the UK the principle of a relevant range. The decision highlights the regard by the Australian Federal Court for UK authority under the new law and presents another step forward in harmonising Australia’s patent law with that in the UK (and Europe).

We are likely to see further development of the Australian approach to sufficiency in 2024 in light of Jusand (FCAFC).

Pre-action production of samples

In CSIRO v Urrbrae [2023] FCA 504, the Federal Court invoked its infrequently used powers to grant pre-action access to samples, in order to assist a prospective applicant to decide whether to initiate patent infringement proceedings.

CSIRO sought preliminary discovery of certain documents and samples of Urrbrae’s wheat products for the purpose of carrying out testing to determine whether Urrbrae infringed two of CSIRO’s patents, titled “Wheat with alternated branching enzyme activity and starch containing products derived therefrom” and “Methods and means for improving bowel health”.

Urrbrae consented to an order for preliminary discovery and provided documents to CSIRO in February 2023. CSIRO reviewed the documents and formed the view that it did not have sufficient evidence to decide whether to commence proceedings.

Urrbrae submitted that the effect of the orders (and subsequent discovery pursuant to those orders) was that CSIRO’s application for preliminary discovery had come to an end. Urrbrae further argued that Rule 7.23 of the Federal Court Rules 2011 (Cth) (FCR), under which a prospective applicant may apply for preliminary discovery, is limited to the production of documents.

CSIRO argued that the Federal Court has power to make an order for production of samples under Section 23 of the Federal Court of Australia Act 1976 (Cth) and Rule 14.01 of the FCR. Section 23 confers on the Court broad powers to make orders of the kind as “the Court thinks appropriate”. Rule 14.01 states that a party may apply to the Court for an order for, amongst other things, “taking a sample of any property”.

Urrbrae submitted that, although the Court has power to make orders under Rule 14.01 in a preliminary discovery proceeding, those powers can only be exercised for the purpose of resolving the issues in the preliminary discovery proceeding. Urrbrae submitted that:

• CSIRO could not rely on Rule 14.01 to seek production of documents to assist in deciding whether to commence proceedings for patent infringement, as opposed to resolving issues in the preliminary discovery proceeding; and
• an order for production of samples would not in any way contribute to resolving the issues in the present matter, which were limited to whether the requirements in Rule 7.23 were met.

In his judgment, Moshinsky J referred to a number of cases in which orders for production of samples for testing had been made to assist prospective applicants under both the 1979 version and current version of the FCR. His Honour stated that these cases did not stand as precedents on the issue before the Court because the contention advanced by Urrbrae (that the Court did not have power to make orders of the type sought by CSIRO) had not been raised.

His Honour reasoned that under the 1979 FCR it was possible to make an order for production of samples for the purposes of determining whether to commence proceedings. His Honour referred to the Explanatory Memorandum of the current FCR and concluded that it would be “very surprising” if there were no such power under the current FCR.

Moshinsky J concluded that the Court did have power to make the orders of the kind sought by CSIRO. His Honour noted that in the context of potential patent proceedings it may be the case that the provision of documents under Rule 7.23 will not be sufficient to decide whether to commence a proceeding and that testing of samples may be required. Rule 14.01 would cover these circumstances.

This decision highlights the availability of pre-action access to samples of products of would-be infringers, and will be welcomed by rights holders.

Life Sciences

Federal Court prioritises priority date

This year, the Federal Court provided some much-awaited guidance on the post-RTB law of priority in the context of the exciting early-2010s race to apply CRISPR-Cas9 technology to the genetic editing of mammalian cells.

ToolGen is the applicant for Australian patent application number 2013335451, which relates to a system for implementing CRISPR/Cas9 in eukaryotic cells. The patent application claims an earliest priority date of 23 October 2012 based on a US provisional patent application (P1), a short document describing “a novel genome editing technology based on RNA-guided endonucleases”.

Under Sections 43(2) and 43(2A) of the post-RTB Patents Act, a claim will be entitled to an earlier priority date if the relevant document discloses “the invention in the claim in a manner that is clear enough and complete enough for the invention to be performed by a person skilled in the relevant art”.

During opposition proceedings in the Patent Office, a number of claims of the patent application were found to lack novelty and lack an inventive step in circumstances where none of the claims were entitled to priority from P1. ToolGen appealed to the Federal Court.

In summarising the relevant principles, Nicholas J stated that the language of Section 43 “is essentially the same” as the language of Section 40(2)(a) (which reflects “classical sufficiency”). His Honour also noted that “it is not sufficient for the priority document to provide a starting point from which the person skilled in the art may transition from one invention to another by use of the common general knowledge”.

One of the issues in dispute was the extent to which various aspects of P1 disclosed technology for use in vivo rather than in vitro. For example, Nicholas J found that P1 only disclosed DNA templates suitable for in vitro preparation of a guide RNA and that there was no disclosure of any system in which nucleic acids were introduced into the cell to transcribe the guide RNA in vivo.

Another question before his Honour was whether P1’s disclosure in the context of a particular bacterial species enabled the performance of the invention more broadly. Nicholas J rejected ToolGen’s argument that P1 discloses a principle of general application. His Honour found that the inventors of P1 tested the technology on components derived only from a specific species of bacteria and that there was nothing in the document to suggest that this species was likely to be representative of other bacterial species with a Type II CRISPR/Cas system, or that these results could be generalised to eukaryotic cells. Further, there was evidence of uncertainty associated with predicting in vivo effectiveness of a CRISPR/Cas9 system from in vitro assays at the priority date.

As to whether the compositions and methods of the claims were otherwise enabled beyond the particular bacterial species disclosed in P1, his Honour concluded that the skilled team would be required to carry out “prolonged research and experimentation and would most likely encounter significant difficulties along the way”. Further, “much of the work would be non-routine and would be carried out in circumstances where P1 provided no meaningful guidance or direction and no assurance of success”. His Honour found that none of the claims of the patent application were entitled to priority based on P1.

After considering the arguments relating to other grounds of invalidity, Nicholas J concluded that each of the claims would, if granted, be invalid.

This case provides a detailed assessment of the “new” Section 43 of the Patents Act and serves as a reminder of the higher standard imposed by the requirement that a priority document clearly discloses an invention, compared to the pre-RTB external fair basis requirement. The makeup of the skilled team may be central to this assessment.

Ascertainment

Under the current form of the Patents Act following the RTB reforms, the only requirement for a prior art document to be considered for lack of inventive step is that the document was publicly available before the priority date of the relevant claim.

However, under the “old” law, which still applies to patents for which examination was sought before 15 April 2013, there was the additional requirement that the skilled addressee could, before the priority date, be reasonably expected to have ascertained, understood and regarded the document as relevant.

The recent decision of Sandoz AG v Bayer Intellectual Property GmbH [2023] FCA 1321 demonstrates the potential perils of the ascertainment requirement. Sandoz sought to rely upon a prior published patent, “WO 919”, in relation to lack of inventive step. In doing so, Sandoz led evidence from a pharmaceutical scientist regarding the types of literature searches that he would have undertaken as part of a research team to find information about a target drug. Sandoz did not replicate any of those searches but instead gave the expert WO 919 and asked what information, if any, WO 919 disclosed that he considered relevant to the task. Sandoz then gave the expert a 71-page spreadsheet of search results containing limited bibliographic information. That search was not a type of search identified by the expert, being limited to patents using a single database rather than covering patents and peer-reviewed literature using multiple databases. The expert was asked to identify which results he considered to be relevant. Unsurprisingly, WO 919 fell in this category.

Rofe J considered that the absence of evidence concerning the nature of any hypothetical literature search is not necessarily fatal for ascertainment. For example, where the prior art document in question is a journal article in a high impact premier journal read by all those in the field wanting to keep up to date with the latest developments, such searches are likely only to spawn an enquiry that adds unnecessary expense and argument to the case.

However, unlike an article in a widely reviewed and highly regarded journal, a patent “must be found”. Further, there was no evidence that the patentee, Bayer, was known to be actively researching and developing the drug referred to in the claims, let alone a drug of the relevant class. Indeed, the evidence was that at least one other class of drug was considered to be promising at the relevant time. As such, Rofe J considered that the hypothetical task put to the expert, which focused only on the class of drugs relevant to the claims and ignored another class, was narrower than the problem to be found in the common general knowledge and, hence, involved a narrower search than would actually have been carried out by a person skilled in the art. In addition, the 71-page spreadsheet was not the direct result of a search but rather had been derived from a search which produced 1,200 pages of results; however, no details were provided as to how the 1,200 pages were narrowed to 71.

In the circumstances, Rofe J did not consider the evidence to establish that it would be reasonable for the skilled addressee to have undertaken a search of the kind described by the expert and to have found WO 919.

This decision demonstrates how a peculiarity of Australian patent law can be fatal to a lack of inventive step challenge reliant upon an obscure or difficult-to-find prior art document.

TMT (Technology, Media and Telecoms)

Medtech inventions post-Aristocrat

Whether computer-implemented inventions are patentable subject matter (a “manner of manufacture”) remains a highly contentious issue under Australian law. While many computer programs, at least at face value, could arguably satisfy the fundamental requirement of resulting in an “artificially created state of affairs” of economic utility, computer-implemented inventions are at risk of being classed as mere schemes or ideas.

As was reported in the 2023 Australian Trends and Developments chapter in this guide, it was hoped that the High Court decision in Aristocrat v Commissioner of Patents [2022] HCA 29 (“Aristocrat”) would deliver some much-awaited clarity on this issue. However, the judgment was split 3:3, resulting in no binding precedent.

Subsequently, in early-2023, the Australian Patent Office (APO) was faced with a series of computer-implemented technologies in the medical technology space. Delegates were required to make decisions as to patentability without further guidance from the Federal Court as to the application of Aristocrat.

The patent applications in The Regents of The University of California [2022] APO 77, Alistair Mann v Electronic Pain Assessment Technologies (epat) Pty Ltd [2023] APO 1 and CareFusion 303, Inc. [2023] APO 17, related to, respectively:

• a method of reducing cognitive decline through the use of a computer-implemented training system;
• a method and system for determining the effect of pain medication on a patient using automated, objective criteria; and
• a system for managing the preparation and distribution of medications from a pharmacy.

Although the parties involved in these proceedings made various submissions as to the application of Aristocrat, the APO did not engage in any detailed analysis of the issues. Nonetheless, each decision noted that particular earlier Full Court decisions regarding computer-implemented inventions have been affirmed and that Aristocrat appears to have confirmed that an advance in computer technology is not a useful test for patentability.

In each case, the APO concluded that the claims of the patent application were overly general, and related to a system or method merely requiring generic computer implementation. The patent applications were all found to be invalid on the basis of lack of manner of manufacture.

Subsequently, the Federal Court considered Aristocrat in Motorola Solutions, Inc. v Hytera Communications Corporation Ltd (Liability) [2022] FCA 1585, in the context of patents relating to computer-implemented inventions in the field of telecommunications. Perram J confirmed that the split decision in Aristocrat has no ratio decidendi “and stands only for the proposition that the Full Court’s decision stands” (at [356]). Perram J noted that while the approach to be taken by a single judge of the Federal Court is clear, the question of the Full Federal Court’s approach remains open.

In September 2023, the APO considered the patentability of another invention in the field of medical technology, a method/system for performing quality control relating to digital pathology images, in Paige.AI, Inc. [2023] APO 44. The Delegate approached the Aristocrat decision in much the same way as the earlier decisions of the APO mentioned above – the Delegate referred to the High Court’s split judgment and noted that both the Full Federal Court and High Court decisions indicate that “an inquiry as to whether there is an advance in computer technology is not a useful test for patentability.”

In a similar vein to the earlier APO decisions, the Delegate in Paige.AI concluded that at the level at which the invention is described in the patent application, its substance is merely using a computer to perform an administrative quality assurance process. Therefore, the claimed invention was found not to comprise patentable subject matter.

As these decisions highlight, inventions in the medical technology space can give rise to complex questions of patentable subject matter. Such technologies tend to be largely comprised of software, which can render patents vulnerable in light of the present uncertainty surrounding computer-implemented inventions. While the ambiguity following Aristocrat will persist for the time being, it remains clear that the relevant enquiry is always as to the substance of the claimed invention, not its form.