Bennett J noted that “The Court does not approach the exercise of its discretion in a manner hostile or antipathetic to amendment. However, the onus is on the patentee to satisfy the Court that the amendments should be allowed.” One factor relevant to the exercise of discretion is whether there has been a full disclosure of all matters relevant to the amendment.

Servier sought to explain the reasons for the amendment via two affidavits from its solicitor. The first identified the reason for the amendment as being a recognition that the specification disclosed matter which could properly be the subject of additional claims. In cross-examination this was admitted to be an incomplete explanation. The second affidavit identified a further reason for the amendment as being to reduce the risk of the patent being invalid by adding narrower claims.

Apotex argued that neither of the explanations for the amendment set out in these affidavits was consistent with the reason set out in correspondence between Servier and its solicitors which had been produced following a waiver of privilege. This correspondence identified the amendments as being designed to overcome potential validity issues raised in related UK proceedings.

Bennett J concluded that the Court should not exercises its discretion to allow the amendments in light of the failure by Servier to provide full and frank disclosure of its reasons for seeking to amend, stating:

Servier should have given its reason for the amendments voluntarily and at the time it sought the amendments. It knew the grounds of Apotex’s opposition to the amendments and it knew of Apotex’s challenge to the validity of the corresponding patent in the UK and its defence to infringement. That clearly raised the scope of the claims and the reasons to amend them … Servier had ample opportunity to amend the AC Patent application if it was of the view that it contained additional claimable matter. It litigated the unamended patent in the UK and pursued the grant of the unamended patent in Australia, abandoning the s 104 amendments. Servier has not sufficiently explained why it took this course. At the time of abandoning the s 104 amendments, Servier was aware of the first instance decision in the UK. Servier’s conduct in relation to the amendments disentitles it from presently amending the AC Patent in circumstances where litigation over the validity of that patent with Apotex was in clear prospect and the contest over the patent had already commenced. The lack of forthrightness in providing Servier’s reasons to amend reinforces that conclusion.

Had Servier pursued the amendment application under section 104, no issue of discretion would have arisen. While any decision regarding amendment must be carefully considered, this decision highlights the difficulties which can arise if amendment is delayed until after the commencement of court proceedings.

In relation to the ground of no intention to use, the hearing officer found that the evidence showed the Applicant had an intention to move its business into Australia, on the basis of discussions with various Australian people and organisations with a view to commencing operations here. However, this was not considered sufficient to establish an intention to use the relevant trade marks.  Further, the Applicant had filed an application in the United States for its marks just prior to visiting Australia and presenting at a symposium and at the time of filing in Australia, Australian companies had joined up with the Applicant’s US based operation. In light of these facts, the hearing officer concluded that it was possible to infer that at the relevant time the applications were filed for commercial tactics, rather than as a genuine indication of a definite intention to use the marks in Australia.

The decision illustrates the difficulties an applicant can have establishing the requisite intention to use a trade mark in Australia where it cannot point to any activities having occurred in this jurisdiction.

Nestle submitted that substantial effort and thought had gone into the creation of the trade mark, that it was distinctive and striking in that the rim of the coffee cup fades out into the darkness to create the allusion of a “halo”. Cantarella submitted that suggestions that the image brought to mind flying saucers, halos or heavenly bodies were far fetched and that the image was simply that of an ordinary cup of coffee. Consequently, Cantarella submitted that if the image had any inherent adaptability to distinguish, such capacity was slight. The Hearing Officer agreed and found that the mark was only to some extent inherently adapted to distinguish Nestle’s goods from others and that the provisions of section 41(5) applied.

Although Nestle was able to point to substantial post filing use of the mark in relation to coffee, such use was found by the Hearing Officer to be, at best, use in a “limping” role in conjunction with the well known house mark Nescafe and was not enough to overcome the ground of objection under section 41 of the Act.

In 2003, the question of ownership of the copyright in the software arose due to apparent copying of that software by former employees of the Intelmail business. At about that time there were also discussions between Dilanchian and Vardanian about the later being “bought out” of the Intelmail business, however no agreement was reached. By 2008, the relationship between Dilanchian and Vardanian had completely broken down, and the issue of ownership of copyright in the software again arose.

There were no written agreements in place dealing with ownership of copyright works produced by Vardanian. Intelmail asserted that either it was the beneficial owner of the copyright in the software or alternatively that it had an implied, irrevocable and royalty free licence. Vardanian conceded that an implied licence existed, but disputed the terms of that licence propounded by Intelmail. Regarding whether Intelmail was an owner or licensee, Moore J noted that:

If there is a lacuna in the contract and it is necessary to imply the grant of some right to fill the lacuna involving a choice between possible alternative rights, the choice should be of that right which does not exceed what is necessary in the circumstances. … if the need can be satisfied by the grant of licence or an assignment of the copyright, the implication will be of the grant of licence only.

There was no doubt that the ownership of any copyright in software developed by Vardanian while an employee of the Intelmail business was owned by that business. With regard to the software produced while Vardanian was employed by his own company, Controlmech, his Honour noted that:

it is unlikely that either Mr Dilanchian or Mr Vardanian would have agreed to an arrangement that imperilled the rights of either or would have put at risk the continued growth or at least prosperity of the business …It is improbable they would have agreed to an arrangement which would, over time, invest in Controlmech copyright in the software over which Mr Dilanchian would have no control other than as a licensee and deny it the opportunity to control the source software.”

Accordingly, Moore J concluded that for the reasonable and effective operation of the contract between Controlmech and Intelmail, it was necessary to imply a term that Intelmail would retain equitable ownership of copyright in the software.

The relevant issues before the Court of Appeal were whether this mark was sufficiently distinctive, and if so, whether its use was likely to deceive or cause confusion in the marketplace due to Intellectual Reserve’s prior trade marks.

It is slightly ironic that Intellectual Reserve pursued the distinctiveness ground, given its own registrations for FAMILYSEARCH.  In considering this issue, the Court of Appeal stated that a mark consisting simply of the words “family search” (whether separated or run together) would be non-distinctive in either plain block letters or cursive form, and expressed surprise (obiter) that Intellectual Reserve had been granted registrations for the plain words FAMILYSEARCH.

Nonetheless, the opposed mark as a whole was held to be distinctive, as the koru/arrow device combined with the words FAMILYSEARCH created a “total sign capable of being memorable to a consumer”.  However to avoid any misunderstanding within the marketplace, the court directed that as a condition of registration a disclaimer be entered that “registration of this trade mark shall give no right to the exclusive use of the words ‘family search’”.  Interestingly, this disclaimer does not appear in relation to the registration’s entry on the Intellectual Property Office of New Zealand’s online database.

Regarding the likelihood of confusion or deception between the marks, the Court considered whether there was any potential that the marks would be used in respect of overlapping services.  Although the services offered by Mr Sintes and Intellectual Reserve both concerned research of births, deaths and marriage records, it was held that the overlap between the two parties’ fields was “simply insubstantial”.  Genealogy-type services were concerned with research of the past, whereas Mr Sintes’ services were for helping others to locate family members in the present and the future.

The fact that Intellectual Reserve’s registrations covered different classes to the class listed for Sintes’ application (class 45) was also considered to be material to the finding that the services were different.  This is unfortunate for Intellectual Reserve, as genealogy services are classified in the current edition of the Nice classification in class 45, a class which did not exist at the time Intellectual Reserve’s trade marks were registered.

The fact that the words “family search” are in common parlance was another reason for finding that confusion or deception was unlikely.  The Court noted that the public is alert to small variations in largely descriptive marks because they expect others to use similar marks.  Therefore, the common features of the marks were neutralised.

It was found that Mr Sintes’ application did not breach any of the provisions relied on by Intellectual Reserve, and that the mark could be registered.

Harris submitted that the important elements in the AWBC Register of Protected Names are the names of the geographical indications themselves rather than the fact that those names are used to describe “regions” and that Fosters was trying to compensate for a marketing opportunity missed. Although the Hearing Officer noted that caution should be used not to conclude that because of the perception of the effectiveness of a mark other traders have a need to use the words in the normal course of trade, she concluded that sufficient evidence was put forward by Fosters to establish a considerable shortfall in inherent adaptation to distinguish.

This shortfall could not be overcome by the applicant’s evidence of use of the trade mark. Although Harris relied on not insignificant evidence of post filing use of REGIONS in relation to wine, such use was found by the Hearing Officer to be use in a “limping” role in conjunction with the name of a specific wine region and was not enough to overcome the ground of objection under section 41 of the Act.

This case concerned the ownership of patents for inventions related to treating cancer.  The inventions were developed by Dr Gray, a Professor of Surgery employed the University of Western Australia (“UWA”) between 1985 and 1999.  UWA claimed that it was the rightful owner of the patents covering Dr Gray’s inventions for a number of reasons, including that there was an implied term in the university’s employment contracts that inventions developed by the university’s employees belong to the university.  At first instance, French J found that UWA was not entitled to ownership of the inventions and patents in question.  In finding that there was no such implied term in the employment contract with Dr Gray, His Honour held that a duty to research does not carry with it a duty to invent.

On appeal, UWA challenged the finding in relation to the existence of an implied term in Dr Gray’s employment contract and also the correctness of the approach taken by Justice French in identifying when Dr Gray had conceived the inventions..

Duty to Invent

The Full Court in a joint decision of Lindgren, Finn and Bennett JJ agreed with French J that Dr Gray’s terms of employment did not include an implied term that UWA had proprietary rights in the inventions and patents.

The Full Court relied on a number of key reasons in affirming French J’s decision.  Firstly, the Full Court noted that Dr Gray had not been engaged to use his inventive faculty in an agreed way or for an agreed purpose, for UWA’s benefit.  Accordingly, Dr Gray’s duty to research could not be “transformed into a duty to invent” if the research carries the possibility of developing inventions capable of attracting patent protection.

Secondly, the Full Court found that the existence of an implied duty to invent would be inconsistent with the freedom Dr Gray had to share and to publish his research results.

Thirdly, the grants and funding Dr Gray obtained from third parties for his research pointed against there being a duty to invent in UWA’s favour.  The Court found UWA’s role in the research and grants process to be limited, stating:

Dr Gray was raising the funds for his research, the metes and bounds of which he determined, though UWA received and managed the funds.  Further, it also can probably be inferred that the grants were made to Dr Gray as an established researcher and not to UWA as such, although its involvement as institutional manager of the grant would also be taken into account by the funding body.  So considered, the “grant factor” can properly be said to be a consideration that further weakens UWA’s claim to the benefits of any inventions so generated.

Fourthly, the need for inter-institutional cooperation to conduct Dr Gray’s research also told against there being an implied term permitting UWA to exclusively appropriate the products of Dr Gray’s research.

Conception of invention

At first instance, French J found that, except for one invention (which UWA was not entitled to in any event), Dr Gray had conceived the inventions which were the subject of the patents in dispute outside of the time period he was employed by UWA.

On appeal, UWA pressed its claim that the ideas Dr Gray had formed prior to joining UWA were not yet sufficiently developed and tested to constitute an invention.

In determining what constituted the invention, UWA submitted that French J focussed upon selected claims of the patents in question to identify what the relevant inventions or inventive concepts were, rather than discerning the inventive concept from the whole of the patent specification including the body of the specification.

In rejecting UWA’s submission, the Full Court noted that UWA’s case on appeal was fundamentally inconsistent with the case it made at trial in this respect.  At trial UWA had advocated assessing each claim specifically to determine the inventive concept. At the time, following this approach was beneficial to UWA because the most specific claims were likely to embody developments latest in time.

The Full Court held that French J had adopted the correct approach of discerning the inventive concept from the whole of the patent specification, as was set out in the recent Full Federal Court decision in Polwood Pty Ltd v Foxworth Pty Ltd [2008] FCAFC 9.  The Full Court also noted that Polwood did not change the law of inventorship in Australia: as the law stands, to constitute an inventor, a person “must have made a material contribution to the invention”.

It has been reported that UWA is considering seeking leave to appeal the decision to the High Court.  Interestingly, since handing down the first instance decision, Justice French was appointed the Chief Justice of the High Court of Australia.