CLAW2209 - Intellectual Property Midsems
Basics:
Defining IP:
● ip is a type of property: personal property (contrast to real property e.g. land or building), intangible
● no internationally accepted definition; usually an inclusive list
IP includes:
● literary, artistic and scientific works,
● performances of performing artists, phonograms, and broadcasts,
● inventions in all fields of human endeavour,
● scientific discoveries,
● industrial designs,
● trademarks, service marks, and commercial names and designations,
● protection against unfair competition, and all other rights resulting from intellectual activity in the industrial,
scientific, literary or artistic fields’
Rights in Aus:
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patent
design
circuit layout
plant breeders rights
confidential information
copyright
trade mark
■ registered
■ unregistered
geographical indications
Legislation via:
● Federal Constitution: s51
● The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good
government of the Commonwealth with respect to: … - (xviii): ‘Copyrights, patents of inventions and designs, and
trademarks’
Protecting IP outside of this list:
● include new technology in an established category of ip
○ e.g. computer program as ‘literary work’ under copyright
● pass legislation for a new type of right which falls within the general terms/words of s 51(xviii)
○ The Grain Pool of WA v Commonwealth (2000) 202 CLR 479 Held: plant variety rights (now Plant Breeder’s
Rights) fell within s 51(xviii); it was within the ‘central type’ of the subject of ‘patents of inventions’
● rely on other heads of Commonwealth legislative power:
○ s 51 (xxix): external affairs
■ e.g. if international treaty (Australia/US Free Trade Agreement, Trade Related Aspects of
Intellectual Property)
● Propagation of treaty
○ s51(v): postal, telegraphic, telephonic and other like services
●
●
Ip rights are national
Globally important - via World Intellectual Property organisation (WIPO)
1
IP
Term
Legislation
Registration?
Patent:
new inventions (products and processes)
20 years (standard)
8 years (innovation)
Patents Act 1990
yes
Design:
new and distinctive visual features of
products (2-dimensional pattern or
ornamentation and 3-dimensional shape or
configuration)
10 years (5 + 5)
Designs Act 2003
yes
Circuit layout:
designs for integrated circuits,
(semiconductor chips)
10-20 years
Circuit Layouts Act
1989
no
Plant breeder’ rights
protection for plant varieties
20 years
(25 years for trees &
vines)
Plant Breeder’s
Rights Act 1994
yes
Confidential information: information of a
until made public
confidential nature that has not been made
public eg confidential knowhow, trade secrets
.case law (equity)
.contract
.legislation eg
Corporations Act
no
Copyright:
works and other subject
matter (economic rights
moral rights)
Copyright Act 1968
(Cth)
no
IP
life of author + 70
years
70 years from
publication
(broadcasts 50 years
from making)
Term
Legislation
Registration?
Trade mark:
● registered
● indication of trade origin of goods
or services
● signs that distinguish one trader’s
products or services from those of
another
10 years (renewable) Trade Marks Act 1995
yes
Trade mark
unregistered
continues if there is
a reputation
tort of passing off/Competition
and Consumer Act 2010
(Australian Consumer Law)
no
Trade Marks Act
Wine Australia Act 2013
yes
Geographical indication
● signs that relate certain products
and services to a place which has a
reputation for those products or
services
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Enforced by:
● Civil remedies: injunctions (court order), damages or account of profits how do you calculate the damage?
Notional licence fee? additional damages in copyright exemplary, for flagrant infringement conversion or
detention: infringing copy treated as if owned by the rights owner e.g. copyright orders for delivery up
seizure by customs Anton Piller order (to secure the evidence where risk it will be destroyed) groundless
threats of action: Copyright Act s 202 Patents Act ss 128-132 Trade Marks Act s 129 Designs Act ss 77-81
Circuit Layouts Act s 46
● Criminal liability (Piracy)
​How can you protect by other means what is not protectable under ip?
● By contract:
○ e.g. control access to the material or the event and impose conditions of access to limit use
■ e.g. sports journalist accreditation to attend sports event
○ e.g. click wrap and shrink wrap contract terms
■ e.g. software, games, music, databases
● By technology: electronic locks
● By voluntary code of conduct: e.g. copyright collecting societies
● Social norms? e.g. used in areas such as jokes, recipes, roller derby, tattoo and graffiti artists
● Ip’s ‘negative space’
Purpose:
● Economic
○
○
​non-excludable
■ Once it is made public/available, it is difficult to prevent others from using it. How to
prevent free riding? (‘reaping without sowing’)
non-rivalrous in consumption
■ the use of the resource by one person does not result in less of the resource being
available for others e.g. file ‘sharing’ of music
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Patents
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A right granted in relation to a ‘new; and ‘non-obvious’ invention that can contribute to economic development in any
field of technology (Fitzgerald & Eliades). - Can be a device, substance, method/process or combination.
Seen as classic Ip right
Australian Legislation:
○ Patent Acts 1990, Patents Regulations 1991
○ Administration: IP Australia, patent office
Advantages - For patent holder
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●
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Disadvantages - for patent holder
Extensive monopoly - protection against
reverse engineering or independent
innovators
Registration rights - makes licensing/financing
more attractive for the other party
Better than alternatives - relying on secrecy
(confidential info)
Protects from reverse engineering - If a
product is shown in its assembled form, you
could not discover how the product worked
from this form.
●
●
●
●
●
●
Only lasts 20 years: then become public
Must disclose details and specifications
Expensive application and maintenance
Risks of disclosure prior to registration
○ Validity of IP put in question when
infringement pursued = Risk of
cross-claim and invalid patent
Expensive to enforce via litigation
Types of Patents:
● Standard:
○ 20 yr term: via ss 65, 67 provided renewal fees paid: (s 143)
■ Can be extended to 25 years for some pharmaceutical patents (s70)
■ Takes 6 months to be granted
● Innovation/ petty:
○ 8 years via ss 65, 68 provided renewal fees paid
■ Incremental advances on prior tech, lower fees + applications = reduce compliance burden
■ Aus-owned products, granted within 1 month (no examination), in Germany & Japan = utility
model
Innovation patent
Standard patent
Your invention must:
Be new, useful and involve an innovative step
Be new, useful and involve an inventive step
The application should include:
A title, description, up to 5 claims, drawings (if
applicable), an abstract and forms
A title, description, any number of claims, drawings (if
applicable), an abstract and forms
A patent is granted if:
The application satisfies formality requirements (note:
a 'granted' innovation patent cannot be enforced
unless examined)
The application is examined and found to satisfy the
relevant requirements of the Patents Act 1990
Examination:
Optional. Examination can be requested by you or
anyone else
Mandatory. The relevant requirements of the Patents
Act 1990 must be met before a patent is granted. Can
only be requested by the applicant.
Certification:
If the innovation patent complies with the relevant
requirements of the Patents Act 1990 in examination;
only after certification can the patent be enforced
N/A
Publication in the Australian
Official Journal of Patents:
At grant and again at certification
18 months from earliest priority date and again at
acceptance
Protection period:
Up to eight years, if annual fees paid
Up to 20 years, if annual fees paid (or up to 25 years
for pharmaceuticals)
How long does the process take?
Approximately 1 month for grant. Six months for
examination if you make a request.
Six months to several years depending on
circumstances
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The patent bargain: monopoly protection for a period in return for disclosure of the invention on the register of patents: ss 186
-187
● Purpose: protect inventive products or processes by giving the inventor exclusive rights over the invention for a period
of time.
Patentability s 18: Steps for authorisation
a) Manner of manufacture
b) Novel (new, not anticipated)
○ Can not be a natural next step (not considered new)
c) Inventive step (not obvious)
○ [for innovation patent: an innovative step]
d) Utility (does what it claims and discloses a specific, substantial and credible use for the claimed invention)
○ Useless items don't have protection (due to protecting the ingenuity of multiple different parts)
e) Not secretly used in patent area before priority date by or with authority of patentee
○ Government issues that (20 years max protection, prior use is looked down on as it does not sit fair)
Manner of manufacture: s 18(1)(a), (IA)(a)
● Patentable invention claimed: is a manner of new manufacture within the meaning of section 6 of the Statute of
Monopolies
○ Includes both products and processes
Cases:
1. National Research and Development Corp v Cr of patents (159) 102 CLR 252 (NRDC Case)
Method of applying known chemicals to a growing crop to kill weeds (new use)
Held: a manner of manufacture means the useful arts not fine arts: a mere scientific discovery is not patentable, there must
be an industrial application.
● Vendible product test:
○ Vendible: of economic significance
○ Product: artificially created state of affairs
● Method of use is what made it patentable
2. D’Arcy v Myriad Genetics Inc [2015] HCA 35
Vendible product test not exhaustive concept of manner of manufacture; if the 2 requirements are met, the subject matter
may be patentable but other relevant factors must be considered, in particular:
● Consistency with the purposes of the Act, including whether allowing patentability:
○ ‘could give rise to a large new field of monopoly protection with potentially negative effects on
innovation’
○ ‘could … have a chilling effect on activities beyond those formally the subject of the exclusive rights
granted to the patentee’ e.g. the risk of inhibiting researchers
○ ‘would involve the court in assessing important and conflicting public and private interests and purposes’
○ The ‘coherence of the law relating to inherent patentability’
And
● Whether the extension of patentability to a particular subject matter ‘would involve law-making of a kind
which should be done by the legislature’
● the international context (patent law in other jurisdictions and Australia’s international obligations) was
also a relevant consideration
Held: isolated nucleic acids coding for mutant or polymorphic forms of the BRCA1 polypeptide do not constitute a manner of
manufacture; the information stored in the relevant sequences is an essential feature that is not modified simply because the
molecules have been isolated (DNA sequencing is not patentable – too important to give monopoly, stifles innovation)
Ideas that can’t be patented:
● not a manner of manufacture:
○ discovery of a law of nature;
○ scientific theory;
○ intellectual information
■ unless applied to a new and useful purpose
○ methods of calculation, mathematical algorithms
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■
but a way of using an algorithm in a process for producing particular effects of economic
significance may be patentable
​Computer program: Simply using computers to implement something is not a manner of manufacturer – not patentable
Cases:
1. Grant v Cr of Patents [2006] FCAFC 210
Scheme for structuring a financial transaction (by use of a trust) to protect an individual’s assets
Held: Not a manner of manufacture; did not produce a concrete, tangible, physical or observable effect
2. IBM Corp v Smith, Cr of Patents (1991) 22 IPR 417
Method and apparatus for generating curves in computer graphic displays; initially rejected by Patent Office as a
mathematical algorithm, a phenomenon of nature and not a trading or commercial application
Held: manner of manufacture; new application of selected mathematical methods to computers which produced a
commercially useful result
3. CCOM Pty Ltd v Jiejing Pty Ltd (1994) 28 IPR 481
(petty patent) computer processing apparatus for assembling text in Chinese language characters; case was about
infringement but raised the issue of patentability
Held: no patent infringement and patent was invalid (had been anticipated);
● But court held there was a manner of manufacture within NRDC case: i.e. artificially created state of affairs with
economic significance
● The relevant field of economic endeavour was the use of word processing to assemble text in Chinese language
characters
Business methods:
1. Welcome Real Time SA v Catuity Inc [2001] FCA 445
Method of using a smart card as part of a customer loyalty programme: the different loyalty programmes of different traders
on the one card; data for each trader was stored separately; Catuity introduced a smart card system for use on buses, cabs, in
retailers in Sydney;
Welcome argued: Catuity had infringed Welcome’s patent; Catuity argued: no infringement and that Welcome’s patent was
invalid (not a manner of manufacture)
Held: Welcome’s method was a manner of manufacture; was artificially created state of affairs; beneficial in the field of
economic endeavour (retail trading); infringement found
Computer-implemented inventions
1. Research Affiliates LLC v Commissioner of Patents [2014] FCAFC 150
‘Valuation Indifferent Non-Capitalization Weighted Index and Portfolio’ - ‘passive management and enhanced indexing
management categories of portfolio management ‘- buying/holding/selling of various securities and assets over time according to an index that weighted the information about the investments according to certain measures of scale or metrics;
Patent office rejected the application: arguing it was merely a scheme or an investment scheme and not a manner of
manufacture; Research Affiliates appealed to the Federal Court arguing it was patentable, it was of economic significance and
the ‘end’ produced was a computer-generated index
Held: not a manner of manufacture;-the courts should take a flexible approach to new technologies when considering
patentability; a range of computer-related inventions have been found patentable e.g. IBM v C of Patents; CCOM v Jiejing;
these were new uses of a computer and not the mere implementation of the invention by a computer but here:
● ’the claimed method … clearly involves what may well be an inventive idea but it is an abstract idea (which is
therefore unpatentable). The specification makes it apparent that any inventive step arises in the creation of the
index as information and as a scheme. There is no suggestion… that any part of the inventive step lies in the
computer implementation.’
2. Commissioner of Patents v RPL Central Pty Ltd [2015] FCAFC 177
Patent application was for a automated process to gather supporting information (by way of automatically-generated user
friendly questions based on assessable criteria- a ‘wizard’) and assess someone for their prior learning (recognition of prior
learning) i.e. determining competency relative to a recognised qualification standard, for the purposes of getting credit for or
undertaking a training course (within the VET sector- vocational education and training) and storing that information
The Patent office: rejected the application, saying there was no manner of manufacture; the invention involved nothing more
than the normal operation of a computer; the claimed invention was merely a scheme or idea that is not patentable
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Held there was no manner of manufacture; there were no steps that fell outside the normal use of a computer [112]; the
claimed invention is a scheme or a business method and not a manner of manufacture; after the D’Arcy case [gene case see
later], the test in NRDC is not to be regarded as an exhaustive formula of manner of manufacture but it is still useful in
appropriate circumstances; this was not a case where the claimed invention related to ‘a new class of claim’ involving ‘a
significant extension of the concept of manner of manufacture’ [119] where factors outlined in the D’Arcy v Myriad Genetics
case should be considered e.g. whether the patent subject matter would have a chilling effect on research [119] RPL
Central Pty Ltd v Commissioner of Patents [2016] HCASL 84
The High Court dismissed RPL’s application for special leave to appeal from the decision of the Full Federal Court
3.
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Encompass Corporation Pty Ltd v InfoTrack Pty Ltd [2019] FCAFC 161
Encompass owned two innovations patents relating to a method (performed using an electronic processing device)
and apparatus (an electronic processing device) for displaying information (information retrieval, data management
and data visualisation)
The patent sought to address the problem of data about entities in different databases being difficult to access (e.g.
owner of land in Land Titles Office, director of company in the ASIC register, driver in the motor vehicle registry)
and in different formats (eg full Christian names, initials, postcode stored in a separate field to the street address;
there may be spelling errors), making matching and comparison of the data about the particular entity difficult;
some of the information is not public and some needs to be purchased
The patents method and apparatus access the information in the different databases (conduct the search, including
making payments required to access the information) and display a visual representation of the relationship
between the entities (by means of a network representation)
Encompass sued Info Track for patent infringement by Info Track’s ‘Reveal’ computer platform;
Info Track admitted the infringement but cross claimed for invalidity of Encompass’ patents; arguing not a manner
of manufacture, not sufficient disclosure; lacked novelty; lacked inventive step; secret use
Federal Court held: neither of the two innovation patents constituted a manner of manufacture
Full Federal Court held: appeal dismissed; the trial judge was correct i.e. not manner of manufacture
○ The Research Affiliates and RPL Central cases were correctly decided (Encompass and IPTA had argued
they were wrong because the courts had failed to treat the grounds of manner of manufacture, novelty,
inventiveness and utility as separate requirements for a patentable invention)
○ The test to be applied is the test in NRDC i.e. is it a proper subject matter according to the application of s
6 of the Statute of Monopolies
○ The characterization of the invention as a manner of manufacture is to be approached as a matter of
substance and not merely of the form of the claims
○ The vendible products test in NRDC is a guide not a formula (Myriad Case)
4.
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Rokt Pte Ltd v Commissioner of Patents [2020] FCAFC 86
An application for the patenting of a computer-implemented digital advertising system and method
The patent application was accepted but then opposed; the opposition was withdrawn but the Commissioner of
Patents re-examined the application under the 2012 amendments (effective in 2013) that extended the grounds for
re-examination to include the issue of manner of manufacture;
● Patent Office: decided the invention did not constitute a manner of manufacture;
○ It was the mere presentation of information;
○ It was a scheme for advertising to online users that were more positively inclined to engage with the
advertising;
■ the use of the computer software was no more than its ordinary use
○ The applicant made further amendments to the application but in a subsequent decision the Patent
Office was found that the amendments did not meet the problem of lack of manner of manufacture
Held: not a manner of manufacture
● it was a marketing scheme; the computer hardware and software are nothing more than a vehicle for implementing
the scheme using computers for their ordinary purpose; the claimed invention ‘did not rise above the level of being
an instruction to use computer technology for its well-known and understood functions to implement the scheme’
5. Repipe Pty Ltd v Commissioner of Patents [2019] FCA 1956
Repipe owned 2 innovation patents: methods and systems for providing and receiving information for risk management in
the field
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●
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a database on a server with information about risk and compliance documentation (workplace health and safety
documents e.g. job safety assessment), a communications network, software enabling users to access and update
the information for particular work sites on a portable device (e.g. smartphone)
after they had been granted, the patents were revoked by the Cr of Patents on the ground that they were not
manners of manufacture
Held: not a manner of manufacture
○ test for manner of manufacture is from NRDC
○ there are no special exclusions for claims for functions performed by computer software
○ an abstract idea, method or scheme for carrying on a business is not patentable
○ for a business method to be patentable it must produce a physical effect; it can be embodied by
electronic processes in a computer system (it does not need to be a piece of hardware) [34]
○ an abstract idea or scheme merely implemented in a computer is not sufficient to constitute a manner of
manufacture; there must be an improvement in ‘computer technology’; Research Affiliates Case [37]; a
business innovation is not patentable but a technological innovation is patentable [39]
○ here there is ‘no meaningful technical content’ in the invention; it was merely a scheme [94]
○ it is a scheme for sharing and completing work health and safety documents; implemented using
computers performing their ordinary functions; there is no invention as to the way the computers carry
out the scheme/method [97]
6. Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2021] FCAFC 202
● the claimed invention was an electronic gaming machine (EGM)
Held: not a manner of manufacture
● manner of manufacture test from NRDC: is it a proper subject matter of letters patent according to the principles
developed for
○ the application of s 6 of the Statute of Monopolies
○ to be determined by common law (case law) and not the usual statutory interpretation methods
○ the questions to ask:
a) Is the invention claimed to be a computer-implemented invention?
b) If so, can the invention claimed broadly be described as an advance in computer
technology?
If the answer to (b) is no, the invention is not patentable subject matter. Of course, if the answer to (a) is no, one must then
consider the general principles of patentability.’ [26-27]
Held:
re (a): the EGM is the computer; the invention is a feature game (a game other than the base game, triggered while playing
the base game, that gives the opportunity for additional prizes and thereby enhancing player engagement) implemented on
the EGM i.e. it was a computer-implemented invention
but:
re (b): it was not an advance in computer technology; the claimed invention related not to the development of computer
technology, but merely to its use
7. Amazon Technologies, Inc [2021] APO 7
Australian Patent Office decision: rejected an application relating to the execution of processing tasks within a cloud
computing system because it was not a manner of manufacture – a mechanism for applications executing on ‘virtual
machines’ within the cloud system to access additional resources as required during bursts of high demand
● Cloud service providers need to avoid situations in which high demands for short periods by some customers (e.g.
ticket sales for an event; sales in the lead up to Christmas) are not exhausting the available capacity and impacting
on other users i.e. resource allocation and scheduling during fluctuating demand
● The invention was a scheme in which ‘business rules’ are applied for scheduling processing tasks, while the
scheduler itself was performing only its ‘usual independent function’ with ‘no improved operation of the computing
technology’ (users were able to accumulate ‘resource credits’ when operating at or below baseline which they can
‘spend’ when they need additional capacity)
● There is no improvement to the technology used and no improvement in the functioning of the computer resources
● Tasks are scheduled based on business rules; computer hardware and software are merely performing their usual
independent function; there is no improved operation of the computing technology and no device of specific
character
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The problem of efficiently using fixed computer resources when a client has unpredictable demands is solved by
structuring the supply of computer resources around ‘a service level agreement that includes a baseline guarantee
and burst performance’
8.
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F45 Training Pty Ltd v Body Fit Training Company Pty Ltd (No 2) [2022] FCA 96
F45 sued BFT, 4 of its franchisees and 1 of its directors, for patent infringement
F45 patents: Innovation Patent No 2015101604 (“the 604 patent”) and No 2016101429 (“the 429 patent”)… the
604 patent and the 429 patent (together “the Patents”) are virtually identical
○ computer-implemented method/system
○ The court and parties focused on the 604 patent: ‘a method and system for remote configuration and
operation of fitness studios from a central server.’
○ ’… a central server to direct different exercise routines in one or more fitness studios in which there are a
number of exercise stations in an open studio environment. Each exercise station has an associated
display which provides directions to users in relation to different exercise routines’
○ ’… studio staff configure the studio exercise stations (128, 129 … ) throughout the studio in question in
accordance with the current studio information program file. In particular, the specification refers to
locating the exercise stations around the studio in question and arranging them in accordance with a
station layout and equipment list (1002)’
○ ’… Users (1315) are then able to perform exercises at each station based on the directions appearing on
the displays’
BFT cross claimed for invalidity of the patent: argued it was an unpatentable business scheme or method
F45 argued: it was ‘not a mere scheme or abstract idea, but is instead a practical application of a computer
implemented method or system that involves physical or tangible steps to produce a physical or tangible result’
●
●
Held:
●
●
patent was invalid: not a manner of manufacture
no evidence that the patent ‘provided a solution to any technological problem, that it represented an advance in
computer technology or that it involved any unusual technical effect due to the way in which the relevant computer
technology was utilised’.
● the invention ‘is carried out using generic computing technology facilitating communications between a server with
access to a database of files and one or more studio computers which in turn communicate with displays located at
the various exercise stations’
● the court (obiter) indicated that if the patents had been valid, it would not have found infringement of the patents
by BFT
● the court made orders revoking the F45 patents
[note: press reports indicate F45 has a similar patent case pending in the US]
What can be patented
What can’t be patented
An improved user interface for executing a financial trade by
selecting trade parameters such as price or quantity, where
the user simply moves a cursor with a mouse over designated
areas of screen to select each parameter rather than clicking,
and executes the trade based on the selected parameters.
A method of creating an index of financial securities on a
computer, where each stock is given a weighted value.
Why not? The substance of the invention lies in the
financial scheme with the computer being used for its
generic data storage and processing functions. This
Why? The substance of the invention lies in the user interface substance is regarded as a business innovation.
if this kind of interface wasn’t previously known, rather than
the trade itself. The improvement to the interface provides a
technical benefit as it allows actions to be completed in a
more efficient manner without clicks.
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A new improvement to the processing or storage architecture The application of a known blockchain technology to a
of a blockchain, or alterations to handle types of information different business context (such as medical records or food
or transactions that couldn’t be previously recorded by the
distribution)
blockchain.
Why not? The substance of the invention lies in the
Why? The substance of the invention is an improvement to
application of known technology (blockchain) to a different
the technical functionality as opposed to the administrative
application. Using the unaltered blockchain in these
aspects of the blockchain.
contexts is a business innovation.’
Methods of medical treatment:
Before:
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Non economic (Joos v Cr of Patents (1972) 126 CLR
611)
Generally inconvenient (s 6 of the statute of
monopolies)
Now:
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Anaesthetic Supplies Pty Ltd v Rescare Ltd (1994)
50 FCR 1 - method of treating sleep disorders
Bristol-Myers Squibb Co v FH Faulding & Co Ltd
(2000) 46 IRP 553- method of administering
(known) drug (Taxol) in cancer therapy
Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd
[2013] HCA 50 - method of treating psoriasis (skin
disorder) using a composition containing as an
active ingredient Leflunomide
Gene tech:
1.
●
D’Arcy v Myriad Genetics Inc [2015] HCA 35
‘… methods and materials used to isolate and detect a human breast and ovarian cancer predisposing gene
(BRCA1), some mutant alleles of which cause susceptibility to cancer, in particular, breast and ovarian cancer.
● See NRDC case - went against purpose of patentability Act (monopoly, inhibiting researchers & conflicting private
and public interests)
Held: isolated nucleic acids coding for mutant or polymorphic forms of the BRCA1 polypeptide do not constitute a manner of
manufacture; the information stored in the relevant sequences is an essential feature that is not modified simply because the
molecules have been isolated
2. MLA and Dairy Australia Ltd v Cargill, Inc and Branhaven LLC [2020] FCAFC 171
C&B applied for a patent for methods of using cattle DNA to identify desirable traits, including meat tenderness (patent was
directed to the use of genetic markers, known as single nucleotide polymorphisms (SNPs) in the selective breeding of cattle)
● MLA and DA opposed the grant of the patent: MLA argued C&B’s claims to methods of genetic testing was not a
manner of manufacture
● APO: patent valid
Held: Found it was a manner of manufacture - argument that patent invalid because it was not a manner of manufacture was
rejected
● this not like D’Arcy Case; that case was concerned with naturally occurring genetic information; here the invention
related to the use of naturally occurring DNA sequences, not the DNA sequences themselves; but patent found
invalid on other grounds (lack of clarity and utility)
3.
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Held:
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Ariosa Diagnostics Inc v Sequenom Inc [2021] FCAFC 101
Sequenom owned a patent for a method of detecting cell-free foetal DNA (cffDNA) in maternal blood serum –
meant genetic testing could be done on a non-invasive basis (rather than eg by way amniocentesis, an invasive
procedure where a small amount of amniotic fluid is sampled from the amniotic sac around the developing foetus,
using a needle
○ Ariosa licenced its own test (Harmony test)
○ Sequenom sued Ariosa for patent infringement
○ Ariosa cross-claimed, seeking revocation of the patent - argued it was a mere discovery of a naturally
occurring phenomenon, so it was not a manner of manufacture
The patent was a manner of manufacture - ‘[t]he artificially created state of affairs is the detection of cffDNA in the
tested sample’ and that ‘[t]his “product” is, by definition the result of human action and is not naturally occurring.’
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(NRDC, Apotex, and Myriad)
It was ‘a method involving the practical application of a means for identifying and discriminating between maternal
and foetal nucleic acid. Although foetal nucleic acid occurs in nature, the substance of the invention is not cffDNA
itself, but the identification of that particular nucleic acid as a part of a method’ [patentology blog ‘Sequenom
Down – Under’ 22 June 2021]
Novel invention (whilst being not anticipated): s 18(1)(b)(i); 18(1A)(b)(i), s 7(1)
invention is novel when compared with the prior art base [acts or documents publicly available in and out of the patent area] as
it existed before the priority date of the claim s 7(1)
Requirements:
● it has not been published or used, anywhere in the world, before the date of lodgement of the patent specification
○ if published or used, the invention has been anticipated and is not novel
● Has the invention been disclosed through prior publication or prior use in Australia or overseas before the priority
date?
○ the prior disclosure must reveal the essential features of the invention
■ not enough if the alleged anticipation is merely ‘a signpost upon the road to the patentee’s
invention’, the prior inventor must ‘be clearly shown to have planted his flag at the precise
destination before the patentee’
● Cannot make a mosaic: combination of bits of info from various prior published sources (General Tyre & Rubber Co v
Firestone Tyre and Rubber Co Ltd (1971) 1A IPR 121)
○ Except where 2 or more related documents and a person skilled in the relevant art should treat them as a
single source of information (e.g if two documents were cross-referenced) (Minnesota Mining and Mftg Co
v Beiersdorf (Australia) Ltd (1980) 144 CLR 253)
Test for novelty: whether the alleged anticipation would, if the patent in question were valid, constitute an infringement
(reverse infringement test) (Meyers Taylor Pty Ltd v Vicarr Industries Ltd (1977) CLR 228)
Cases:
1. Fomento Industrial SA v Mentmore Mftg Co Ltd [1956] RPC 87
Patent for an improved ball point pen; prior to patent application, Fomento gave one pen to a member of a government
department without any obligation of confidentiality
Held: invention revoked; lacked novelty
● Protects new inventions from others stifling innovation
● Protect yourself by making sure its not published anywhere else
2. Windsurfing International Inc v Petit [1984] 2 NSWLR 196
Patent infringement action for windsurfer; priority date in March 1968. The respondent cross claimed for revocation on
various grounds, including lack of novelty
Held: invention revoked for lack of novelty based on prior publication (1965 newspaper article, with picture of a sailboard)
and prior use in 1940s (by persons experimenting with hand-held sails attached to canoes)
3. Dennison Mftg Co v Monarch Mktg Systems (1983) 1 IPR 431
invention: plastic tag used to attach price labels to merchandise, had been anticipated by a French specification (in French)
filed earlier in Australian Patent Office
● where it is an act that is alleged to destroy novelty, the question is whether there is an act that did in fact make the
information (the integers of the invention) publicly available
4.
●
●
●
Damorgold Pty Ltd v JAI Products Pty Ltd [2015] FCAFC 31
The Damorgold patent related to a spring assisted mechanism for raising and lowering a blind
When the patentee sued for infringement the respondent argued the invention was invalid as it lacked novelty
Before the priority date of Damorgold’s patent, a RolaShades product had been imported into Australia embodying
all the integers of the patent and it was shown to some potential customers by JAI Products in order to solicit sales
but no sales were in fact made; no samples of the product were left with any of the potential customers
○ The product was shown in its assembled form and you could not discover from the assembled form how
the product worked; in order to find out how it worked you needed to pull the product apart; this was
11
not done
Held: the Damorgold patent was not invalid because it lacked novelty through the doing of this act
● The demonstration in public of the assembled form of the product did not disclose all the integers of the invention
● In order to amount to anticipation of the invention, the information made publicly available by the doing of an act
must be such as to enable a person skilled in the relevant art to put the claimed invention into practice
Exceptions: Certain disclosures do not destroy novelty (they are disregarded); s 24, regulations.
● Showing or use of invention at a recognised exhibition or the publication of the invention at such an event (reg 2.2)
● Publication of invention in written paper and read before a learned society or published by or on behalf of a learned
society (reg 2.2A)
● Working in public of the invention within 12 months before the priority date for the purpose of reasonable trial where
the nature of the invention makes it reasonably necessary for the working to be in public (reg 2.2B)
Grove Hill Pty Ltd v Great Western Corp Pty Ltd [2002] FCAFC 183
Great Western owned a patent for a row cultivator for use in farming; it had acquired the patent from Mansur, the inventor
● Mansur had trialled various combinations of the integers (blades etc) over a period of months (two growing
seasons);
● Great Western sued Grove for patent infringement; Grove denied infringement and counter-claimed for revocation
of the patent on various grounds, including lack of novelty and prior secret use
Held: the invention was novel; was there reasonable trial or experiment within s 9? Yes
● to assess reasonable trial you had to look at the nature of the equipment in question, the tasks it was designed to
undertake and the conditions of use; here a row cultivator would need to be robust to resist the rough nature of its
intended use; it would be expected to function in a variety of conditions (weather and terrain); it could not be
subjected to reasonable trials in anything less than a year, particularly given the seasonal nature of it use
Grace period:
Grace period of 12 months before the priority date introduced in 2002: reg 2.2C Purpose: to cover circumstances where an
inventor inadvertently disclosed an invention prior to seeking patent protection. Not recognised in all overseas jurisdictions (Jap,
US & Canada = yes, EU = no). Does not apply to commercial usage
Not affecting novelty: information made publicly available without the consent of the patentee, through any publication or use
by another person who derived the information from the patentee: s 24(1)(b).
Inventive step (not obvious): s7
An invention which lacks an inventive step is said to be obvious. A patentable invention must expand the base of knowledge in
the prior art base in a manner that goes beyond technical innovation, workshop improvement, or obvious extension.
Test: whether it would have been obvious to a non-inventive [a not particularly imaginative] skilled worker in the field, with the
common general knowledge in that field at the priority date, to solve the problem solved by the invention, by following the
same course as the inventor as a matter of routine
Person skilled in the art; common general knowledge in the patent area or out of the patent area (experience and background
knowledge)
Relative factors/guide to determining inventiveness:
● Has the invention satisfied a ‘long felt want’ (is it a solution to a longstanding problem?)
● Is the invention a commercial success?
● Have others moved quickly to copy it?
Cases:
Inventive step
1. AstraZeneca AB v Apotex Pty Ltd [2015] HCA 30
AZ owned patents for use of rosuvastatin to treat high cholesterol (marketed as Crestor); A wanted to sell rosuvastatin in
Australia
AZ sued for patent infringement; A sought revocation of AZ’s patents
12
Held: patents were invalid
● rosuvastatin was disclosed in the prior art; it would be obvious to treat high cholesterol with the dosage claimed in
the patent; the skilled person would have been led directly as a matter of course to try rosuvastatin in the
expectation that it might well be an efficacious treatment
○ test for inventive step: look at the claimed invention in light of common general knowledge of the
hypothetical person skilled in the relevant art and any prior art information
○ an invention may be obvious in light of one prior art document irrespective of the fact that other relevant
prior art documents may suggest an alternative course
● rejected earlier case law that said in assessing inventive step you first determine the nature of the claimed
invention and the inventive step as described in the patent specification and then assess inventiveness by reference
to the common general knowledge and prior art information
Person skilled in the art:
1. Commissioner of Patents v Emperor Sports Pty Ltd [2006] FCAFC 26
● Patent for removable strips worn by touch football players; removal of the strip indicated they had been tackled
● Patent was revoked by Cr of Patents because it was obvious; invention had been described in US patent relating to
US football and it would have been reasonable to expect a rugby league or Australian rules football coach, referee,
umpire or administrator to have discovered the US patent
Court held: invention not obvious; it was fanciful to have expected such coach, referee, umpire or administrator to have
searched the US patents register
Problem of hindsight: it looks easier/obvious when you look back, after the problem has been solved
2.
●
Aktiebolaget Hassle v Alphapharm Pty Ltd [2002] HCA 59
Omeprazole used treating gastric and duodenal ulcers; but there were storage and administration problems; after
trial and error Aktiebolaget (Aktie) combined 2 other ingredients with omeprazole in a capsule or tablet to make it
a more effective product (it coated the omeprazole with the 2 ingredients). Aktie had a combination patent.
● Alphapharm (Alpha) wanted to import a drug similar to Aktie’s patented drug; Alpha sought an order for
infringement; Alpha cross claimed for revocation on the basis of obviousness
Held: invention was not obvious; the combination of integers was not obvious, although individually each may have been
‘worth a try’
● The court warned against the ‘seduction of hindsight’; it was not appropriate to start with the end product and
then to conclude that all integers which were ‘worthwhile trying’ in an attempt to achieve this end were obvious
3. Minnesota Mining & Mftg v Beiersdorf (Aust) Ltd (1980) 144 CLR 253
Invention: ‘breathable adhesive surgical tape’
Argued: obvious
Held: patent valid; demand for the tape for some time, not satisfied by anything on the market; MMM’s product solved the
problem and was a commercial success
4. Lockwood Security Products Pty Ltd v Doric Products Pty Ltd [2007] HCA 21
For existing deadlocks you needed to use a key to unlock them from the inside; so if the key was lost, occupants could be
trapped inside the premises;
● Lockwood’s new deadlock was a combination of known integers: existing deadlock plus a release mechanism
whereby the key used on the outside lock deactivated the inside handle lock; this type of release had been used in
storeroom locks but not in combination with a deadlock; Doric produced a lock based on the same idea; Lockwood
claimed patent infringement
Doric cross claimed for revocation on various grounds including obviousness
Held: Lockwood patent was inventive
● following factors important in relation to inventive step: it solved a well-known and long-standing problem; others
had tried and failed to solve the problem; it was a commercial success; Doric had sought to copy the invention
AI
●
●
●
What will be the effect of using artificial intelligence (AI) to help create the invention?
Will the use of AI become common, such that it has to be taken into account when determining inventive step ie the
person skilled in the art will use AI?
For AI-generated inventions: should the person skilled in the art be replaced by an algorithm trained with data from a
designated field of art?
13
Indigenous knowledge
Hood v Bush Pharmacy Pty Ltd [2020] FCA 1696
● H’s invention was product and method of use patent for essential oils derived from a plant (the shrubs of the genus
Kunzea species ambigua (native shrub in Tasmania)) – relieves pain, minimises bruising, assists in healing
● sued BP for patent infringement
● BP cross claimed for revocation – argued not manner of manufacture; no inventive step
As to inventive step issue:
● Aboriginal people have used native plants for therapeutic purposes for thousands of years
● E.g. crushed tea tree leaves inhaled to treat coughs and colds, leaves soaked to create an infusion used to treat skin
ailments
● there was evidence that tea tree oil had therapeutic uses
● there was some experimentation in relation to essential oils extracted from native plants
● but there was nothing in the evidence ‘to indicate that, as at the Priority Date, a person skilled in the art would
have had any reason to test Kunzea ambigua for the purpose of determining whether it might yield an essential oil
derived from the plant that could be useful as a method of treatment.’ [146]
Patents of addition: the patent owner can apply for a patent of addition (ss 80-82) for improvements in or modification of the
parent’ invention. Is valid for the term of the parent patent s83, and can be revoked if the parent patent is revoked s 85
● it cannot be challenged on the basis that it is obvious, even if there would otherwise not be an inventive step if you
take into account the parent invention
BUT
● Conditions are restricted to parent invention: s 83
● If parent invention is revoked → patent of addition continues for the term of parent invention: s 85
○ 3rd party modifications/improvements are grounds for infringement of patent (requires licence)
For innovation patent:
​S 7(4) For the purposes of this Act, an invention is to be taken to involve an innovative step when compared with the prior art
base unless the invention would, to a person skilled in the relevant art, in the light of the common general knowledge as it
existed (whether in or out of the patent area) before the priority date of the relevant claim, only vary from the kinds of
information set out in subsection (5) [the prior art base] in ways that make no substantial contribution to the working of the
invention.
Innovative step: Based on the assumption that a person would make the step if they weren't a skilled worker. No difference
between invention & existing tech. Even if it does differ - differences don’t make enough of a significant difference.
Case:
1. Dura-Post (Aust) Pty Ltd v Delnorth [2009] FCAFC 81
Delnorth had an innovation patent for roadside posts made of sheet spring steel;
● posts to be used on the edge or shoulder of roadways to delineate lanes and direct traffic; designed to bend under
pressure and return to their starting point
● patent claims referred to a number of other features: e.g. marker hole (how far to drive the post), barb (to hold it
firm); tapered end (easier to drive post into the ground) to correct depth
Delnorth sued Dura-Post for infringement
● Dura-Post counter-claimed that the Delnorth patent was invalid because of 2 prior US patents; Delnorth’s patent
claims differed from the US patents in respect of the other features
Held: Test for innovativeness: ‘requires a narrow comparison between the invention as claimed and the relevant prior
disclosure having regard to the fact that the threshold for an innovation patent is intended to be lower than for a standard
patent’
● here: the other features which made the Delnorth patent different to the US patents contributed in a real way to
the working of the Delnorth patent, so the patent was innovative
IP Australia Case Study: The product: Stubbyglove
The problem: the combination was new but the elements were not
The solution: apply for an innovation patent
14
Problems with innovation patent: raised standard to same level as standard patent
● Now no longer able to file innovation patents, 2029 is expiry year → phased out due to not achieving the intended
objective. Low standards, unexamined innovation protected big businesses from SME to innovate. Low confidence
Useful - 18(1)(c): The invention must do what its inventor claims it will do. The specification must disclose a ‘specific, substantial
and credible’ use for the claimed invention (s 7A)
Not secretly used - use unknown to the public and not discoverable by the public. To allow secret use would allow the patentee
to have a de facto extension of the patent term
● secret use for reasonable trial is permitted & grace period can save the secret use from invalidating the patent: s 9
Combination patent: You can have patents over existing material: “claiming a combination of elements, some or all of which are
known, gives a new result through the combination (the interaction of the elements creates a new result)”.
○ not patentable if the combined elements merely perform their own function and don’t produce a new result
(a mere collation)
Selection patent: selects out of a group of members of a known class, a subclass having an advantage over the class as a whole
What is not patentable:
● s 18(2): Human beings, and the biological processes for their generation, are not patentable inventions. interpreted
narrowly
Case:
1. International Stem Cell Corporation [2016] APO 52
Addressed by Patent office. Application for stem cells. Issue does this fall within s18 (2). APO said no.
But s 18 (3) innovation patents, plants and animals, and the biological processes for the generation of plants and animals, are
not patentable inventions. → But the exclusion in s 18(3) does not apply if invention is a microbiological process or a product
of such a process s 18(4)
●
s 50(1)(a): Commissioner of Patents may refuse to grant patent for invention the use of which would be contrary to
law
Cases:
● Bombs for burglars
● Cannabis laws changed, now acceptable for medicinal use. [Shelston IP Dec 2018]
1. Woo-Suk Hwang’s Application [20014] APO 24
Method of producing a hybrid embryo by transferring the nucleus of a human cell into bovine ovum and activating the ovum
Held: within s 18(2); also contrary to law (breach of s 20 Prohibition of Human Cloning Act 2002)
s6 Statute of Monopolies (concluding words): ‘not contrary to the law, nor mischievous to the state by raising prices of
commodities at home, or hurt of trade, or generally inconvenient’
Case:
1. Rolls-Royce Ltd’s Application [1963] RPC 251
New take off procedure for jet → rejected on grounds of general inconvenient as it would restrict pilots ability to fly safely
15
Application, examination & opposition
Application
Anyone can apply but only s 15 categories can be granted the patent: file under patent request via s 29 (priority date is s 43).
Provisional specification is optional. 12 months to refine invention and file complete specification (s 38)
● For provisional specification: (optional)
○ must disclose the invention in a manner that is clear and complete enough for the invention to be
performed by a person skilled in the relevant art: s 40
○ provided the provisional specification discloses the invention in a manner that is clear and complete enough
for the invention to be performed by a person skilled in the relevant art, it will provide a valid priority date
for the invention later claimed in a complete application: s 43 (Must be extremely specific)
■ Fast track: file in overseas jurisdiction that is a party to the Patent Cooperation Treaty (PCT), and
you have 12 months from that date to file in Australia: if you do, you get the benefit of the earlier
(overseas) priority date: ss 88-93-same for Paris Convention: ss 94-96
● For complete specification: s 40(2),(3),(4)
○ invention in a manner that is clear enough and complete enough for the invention to be performed by a
person skilled in the relevant art
○ disclose the best method known to the applicant of performing the invention and
○ for standard patent: end with a claim or claims defining the invention
○ for innovation patent: end with at least one and no more than 5 claims defining the invention
○ claim/s must be: clear and succinct + supported by the matter disclosed in the specification [this replaces
the requirement of ‘fair basis’]; claims state the boundaries of the monopoly being claimed by the patent
Examination
Innovation patent: no formal examination + not enforceable until examined and certified (s 120), Commissioner + anyone has
right to examine (s 101A)
Standard patent: examined before grant (s 44), 1-2 years after filing, (s 142) the application can lapse after 5 years and the
applicant has not requested.
Criteria for examination (s 45);
● specification must comply with s 40(2)-(4), s 18(1)(a)-(c)
● a patentable invention within s 18(2)
● grounds for refusal: s 50
● notice of acceptance published in Official Journal of Patents: s 62
● re-examination: s 97, s 98 is confirmation of rejection.
Opposition:ss 59, 60 - within 3 months after acceptance is advertised.
Revocation after grant: s 20, 138; counterclaim for revocation in infringement proceedings: s 121
16
Protection outside Aus: apply in each jurisdiction where protection is sought or application under Patent Cooperation Treaty
(PCT) for convention countries + WTO
Ownership and licensing
Ownership: s 15, joint = s 16
Inventor, someone entitled to have the patent assigned to them, persons deriving title from inventor → via case law: material
effect on the invention by assessing contributions to the invention, rather than assessing the inventiveness of the respective
contributions (JMVB Enterprises Pty Ltd v Camoflag Pty Ltd [2005] FCA 1474)
Note: AI can be inventor but not applicant or grantee
● Via Thaler v Commission of Patents [2021] FCA 879 (AI designed new bev container via fractal geometry)
○ O must be human, via procession since Thaler owns source code of AI
Employee inventions: (s 15(1)(b)) would, on the grant of the patent for invention, be entitled to have the patent assigned to the
person
No provision in the Patents Act, therefore depends on contact of employment and case law
● Usually an express term of employment contract in order to avoid uncertainty. But if the express term is too wide, it
might be found to be void as an unreasonable restraint of trade.
Case:
​1. Electrolux Ltd v Hudson [1977] FSR 312
Where there was no express term in contract of employment, implied: employer will own the invention if invention was
created by employee during the usual course of the duties (via Sterling Engineering Co Ltd v Patchett [1955] AC 543)
BUT Can argue
2. Spencer Industries Pty Ltd v Collins [2003] FCA 543 - inventor and owner of the patent; invention fell outside the duties he
was required to perform - workers won case
3. VUT v Wilson [2004] VSC 333 - 2 academics were in breach of their fiduciary duty owed to University, not to profit from
expense of employer and avoid conflict of interest → University won case
4. UWA v Gray [2009] FCAFC 116 - anti cancer treatment for liver. On grounds academic was hired to research and not invent.
Gray won
Rights of patent owners: s 13
Exclusive rights to exploit invention, authorise others.
If product: make, hire, sell, dispose, offer to make, use, import or keep
If method/process: similar to product, can also assign rights/licence to others (express, exclusive/ non-exclusive, implied or
compulsory)
Exhaustion vs. Implied licence:
Implied licence principle: patent rights in relation to a product continue to follow the first sale; the purchaser acquires a licence
to do all the things they would normally be entitled to do under the law of personal property
Exhaustion principle (obiter): the first sale of the patented product extinguishes the exclusive rights of the patentee in relation
to that product i.e. the sale takes the product outside the scope of the patentee’s monopoly rights (but there cannot be a
making of the patented product).
● Note: the patentee is rewarded for their efforts on the sale of the product on negotiated terms; nothing in the Patents
Act to suggest the patentee is to be rewarded more than once – i.e. the buyer is free to do whatever they want
because the original patent holder has no more rights in relation to that particular item.
Cases:
1.
Calidad Pty Ltd v Seiko [2020] HCA 41 - importing and selling reconditioned printer cartridges with modifications
(refill, reprogrammed/removed chips + integrated circuit) - This ruling confirms that once a patented product is
sold, the patent holder can no longer control what happens to that product, except that they retain the exclusive
right to make new versions of the product. The buyer is free to use, sell, and even repair the product as they see
fit, but they cannot replicate it
17
Compulsory licence: when the reasonable requirements of the public have not been satisfied or to remedy anti-competitive
conduct. 2015 Medicine Producers → health crises under DOHA declaration
Infringement and Remedies:
Infringement: means to exercise any of the exclusive rights to export the invention, without the authorisation of the owner of
the patent. (s 57): can sue once patent granted
● Does the alleged infringing act fall within the exclusive rights of the patent owner?
● Does the alleged infringement tell all the essential integers of the patentee;s claims?
● Do any exceptions to defences apply?
Exceptions:
● where patented product is marked to indicate it has been patented, is sold or used to a substantial extent before the
infringement, infringer is taken to have been aware of the existence of the patent, unless the contrary is established: s
123
● mere possession (with no intention of commercial dealing), purchase, ownership, transporting, a patented article
generally will not amount to infringement (Nobels Explosives Co Ltd v Jones, Scott & Co (1992) 8 App Cas 5)
Infringement based on purposive approach vs. literal
● Essential elements ‘pith and marrow’ taken by infringer
○ Still counts if less essential parts might be omitted/replaced by mere mechanical equivalent
● Essential integer: ‘whether persons with practical knowledge and experience of the kind of work in which the
invention was intended to be used, would understand that strict compliance with the particular descriptive word was
intended by the patentee to be an essential requirement of the invention so that any variant would fall outside the
monopoly claimed, even though it would have no material effect upon the way the invention worked’
○ Skilled person test: whether a variant or modification of an invention still infringes a patent. Specifically,
someone skilled in the field would interpret the precise terms used in the patent as being essential. If the
skilled person understands that strict adherence to the description is necessary, then any variation—even if
it doesn’t change how the invention works—would not infringe on the patent. (e.g. metal piston vs. plastic)
Cases:
1.
2.
3.
4.
5.
Catnic Components Ltd v Hill & Smith Ltd [1981] FSR 60 - infringer only changed back plate by 6 degrees = no
significant change = infringement
Populin v HB Nominees Pty Ltd [1982] FCA 45 - Added small supply at the head of sugar cane billet + large storage
bin at rear. = no infringement - essential feature
Kimberly-Clark Australia Pty Ltd v Multigate Medical Products Pty Ltd [2011] FCAFC 86 - single step sterilisation
sheet vs. 2 sheet wrap system. = no infringement as all essential integers had not been taken
Grove Hill Pty Ltd v Great Western Corp Pty Ltd [2002] FCAFC 183 - 2 pair plates vs. ‘pair of plates’ of cutting
blades on row cultivator = no infringement found (prior to Calidid and Seiko case)
○ Importation is an infringement of patent without authority of patentee → if patentee commercially
distributes the patented product or products produced by the patented process, there is an implied
licence to import the product into Australia (exhaustion of rights)
Calidad Pty Ltd v Seiko [2020] HCA 41 - (continued)
○ not a question of implied licence, question is whether a new product has been made → Infringement
occurs when a new product is made which embodies each of the essential integrations of the intention.
Modification did not involve the replication of parts and features. Modifications were consistent with ‘
the exercise of the rights of an owner to alter an article to improve and enable its re-use)
Contributory infringement: s 117- where use of a product would infringe, the supply of the product will constitute infringement
by supplier
Cases:
1.
Bristol-Myers Squibb Co v F H Faulding & Co Ltd [2000] FCA 316 - BMS had patents for Taxol = highly toxic drug for
cancer. F.H. supplied to doctors with info guide (user of info guide infringe BMS patent) → BMS sued under s 117, F
cross-claimed under novelty = infringement as not novel but even if novel still wouldn’t have worked
18
2.
Danisco A/S v Novozymes A/S (No 2) [2011] FCA 282 - food prep enzyme for baked goods. Danisco sued under s
117. → contributory infringement recognised as was used in baked goods as they advertised it in their goods, only
use was for baking
Exceptions:
Springboarding: if generic drug manufacturers (those manufacturing drugs where the patent has expired) had to wait until the
end of patent term and then get approval to market the drug, this would give the patent owner a de facto extended term for
the patent:
● s119A - allows springboarding at any time during the patent term, for purposes solely connected with having goods
intended for therapeutic use
● S 199B - the regulatory approval exception to infringement is extended to all technologies
○ Cannot stockpile the patented product for sale upon expiry of patent
○ Cannot manufacture the product for export to another country
● S 199C (Experimental use) - Provides an exemption from infringement for research and experimental activities. Not
applicable where the main purpose of the acts is to commercialise the invention or manufacture it for sale
Remedies
● Patentee or exclusive licensee (but must join patentee in the proceedings) can sue: s 120
● Sue within 3 years from the grant of patent or 6 years from date of infringing acts: s 120(4) (Choose the later)
○ For innovation patent must be granted + certified prior to suing s 120(1A)
● Usual tactic for infringer is to counterclaim for revocation of patent: s 121
● S 122:
○ (1) Injunction and either damages or accounts of profits (
○ 1A) additional damages for flagrant breach
● S 123 (1): Court may refuse to award damages or account of profits if defendant satisfies court that, at time of
infringement, the defendant not aware, and had no reason to believe the patent existed
● S 128 & 129A: unjustified threats of infringement
○ s 131: notify party suspected of infringing with existence of your patent
○ Can be countersued to seek remedy (injunction, damages)
○ S128 & s 132 protects patent attorney for acting on behalf of client
Issues with patents
● Drugs: multiple patents of variations of same drugs, production, combinations and uses
● Green tech
● Indigenous communities: traditional knowledge of medicinal herbs
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Designs
●
●
Protection for VISUAL forms of mass-produced articles (Look NOT function)
○ ignore how its made, incentive for time + skill for better product designs (promote true advances over state
of the art)
○ Other IP regimes - passing off/misleading or deceptive conduct, shape/trademark
Examples: toys, furniture, bathroom and kitchen fittings, sporting goods, car spare parts, mobile phones
Legislation + Admin framework
Designs Act 2003 & Designs Regulations 2004- via Designs Office in IP Aus
Costs: ~ $650-850 for application + examination → renewal after 5 years (10 years max granted) also ~ $400
Limited protection outside of Aus as not part of the international convention
Registrability
S 5: a product, means the overall appearance of the product resulting from one or more visual features of the product
S 8: design must be used in relation to a product - it is not possible to register a shape or pattern as such
S 7: Visual feature - visual appeal of manufacture products
3 criterias:
1. Includes the shape, configuration, pattern and ornamentation of the product
2. A visual feature may, but need not, serve a functional purpose
3. Following are not visual features:
○ The feel of a product; and
○ The materials used in the product;
○ In the case of a product that has one or more indefinite dimensions
i.
the indefinite dimensions;
ii.
if the product also has a pattern that repeats itself - more than one repeat
Includes:
● Shape, configuration: 3D ( e.g. shape of chair or sports helmet)
● Pattern and ornament: 2D (e.g. pattern on textile)
● Mixture of both (e.g. ribbing on a rubber hot water bottle)
Cases:
1.
Firma Group Australia Pty Ltd v Byrne & Davidson
Doors (1987) 180 CLR 483 - combination handle + lock
for shutter door-innovation: keyhole plate + recessed
door handle. Sued B & D for infringement
Held: design registration did not protect the idea of a rectangular
plate with keyhole and recessed handle (too general)
design monopoly is limited the ‘one particular
individual and specific appearance’ of the combination
lock and recessed handle in the design registration
Held: Firmagroup’s registered design was valid but there was no
infringement because B&D had sufficiently distinguished its
product
Design must be separated from product: if the design only has 1 possible shape, can't patent it
Cases:
1.
2.
3.
Re Wolanski’s Registered Patent (1953) 88 CLR 278
○ (Re Wolanski’s Registered Design (1953) 88 CLR 278: a ‘neck-tie support’ could not be registered because
the shape defined the article – design and product inseparable
Koninklijke Philips Electronics NV v Remington Products Australia (2000) 44 IPR- if the product has only one
possible shape, it will not be registrable, otherwise it would be equivalent to granting a monopoly over the product
ie no registration for the fundamental or essential form of a product
Malleys Ltd v J W Tomlin Pty Ltd (1961) 35 ALJR 352 - shape of the bottom of the toilet pan
○ ​‘sufficient individuality of appearance’ to distinguish it from the fundamental form of an article; the
existence of this individuality is to be determined by the eye and not by measuring dimensions
20
4.
Dalgety Australia Operations Ltd v FF Seeley Nominees Pty Ltd (1985) 68 ALJR 458 - air conditioner, Dalgety sued
Seely for infringement, countered with Dalgety’s design was not registrable
○ Held: Dalgety’s design was registrable - fundamental form of air conditioners was a box/cabinet on a stand
→ Dalgety’s design tool was slim & upright making it beyond the fundamental form
Can a virtual or non-physical design be registered? Designs Office practice is that it required the design of the product to be
visible when the product is in its resting state rather than when it is in use
New and distinctive:
s 15 - Newness (New design requirements) → new, not publicly used in Aus or published anywhere.
1) A design is a registrable design if the design is new and distinctive when compared with the prior art base for the
design as it existed before the priority date of the design
2) The prior art base or a design consists of
a) Prior public use of the design in Australia
b) Prior publication in a document in or outside Australia
c) Disclosure in an earlier application
i)
Design disclosed in design application
ii)
Design has an earlier priority date than the designated design
iii)
First time documents disclosing the design are made available for public inspect under s 60 is on
or after the priority date of the designated design
Priority date: filing date of application for registration (s 26, 27)
Prior public use: exposure to public view (selling article which the design is applied, displaying it or offering for sale)
Prior publication: trade magazines, textbooks, pamphlets, patent specifications
Cases:
1.
J Rapee & Co v Kas Cushions (1989) 90 ALR 288 - chair/ cushion pads with distinctive tufting & piping. Sued for
design infringement, respondent cross-claimed that designs had previously been used in Aus. Cushion evident in
Sears Catalogue + diagrams in Ikea catalogue.
○ Held: did not establish sufficient prior publication in Sears but did in Ikea (provide as much evidence as
possible)
s 16: Distinctiveness → visual difference vs. prior art base (overall visual appearance via shape, configuration, pattern or
ornament)
1. New unless identical to design that forms part of the prior art base for the design
2. Distinctive unless substantially similar in overall impression to a design that forms part of the prior art base (s 19)
3. S 15 (2)(c) - newness or distinctiveness of a design is not affected by mere publication or public use of the design on or
after the priority date OR by rego of another design on same or later priority date
S 19: Overall impression (Newness + Distinctiveness) to a person skilled in the art
1. Substantially similar in overall impression. Weight to either similarities or differences
2. Person must
a. State of development of the prior art base
b. In design application, disclosure of statement (newness & distinctiveness) to identify particular visual
features
i.
Particular regard to those features
ii.
If only part of design, have particular regard to that part but also as a whole
c. Amount & quality and importance of isolated part
d. Regard for freedom of the creator of design to innovate
3. If no statement, must regard to appearance of the design as a whole
4.
5.
Familiar person test: in applying 1,2 & 3, must be applied from the perspective of a familiar person (Familiar person:
does not require that the person be a user of the products. Instead the standard is that of a person who is familiar
with the product, or products similar to that product) → consumers, experts, specialists and tradesperson
Reference to a person includes a reference to a court (under infringement)
21
Distinctiveness: comparing design individually to each relevant piece of prior art; not as a whole (ss 15(1), 16(1),(2))
● a design that combines various features each of which is found in the prior art base when considered as a whole but
not in any one particular piece of prior art, is capable of being distinctive: ss 16 and 19(1)
Strategy to argue for s19 =
1. Define informed user - knowledge + experience (practical) to distinguish distinct visual diff compared to prior designs
2. Overall impression - total appearance vs. prior art (existing designs). Focus shape, configuration, pattern or
ornamentation
3. Small variations = significant differences (for). If against, highlight that changes are too minor
4. Compare to prior art - how it stands apart in meaningful way
5. Perception of informed user - subjective, find evidence on opinion
Case:
1.
World of Technologies (Australia) Pty Ltd v Tempo (Australia) Ptd Ltd [2007] FCA 114 - 2 companies used vacuum
cleaners from China made by SFE. Tempo exhibited on their website whilst SFE gave permission for WOT to apply
for design reg on 16/6/2005. WOT sued Tempo for infringement. Tempo argued design reg was not new or original
+ WoT was not entitled to rego.
○ Held: WoT’s design was not registerable due to prior publication in China
■ Design was new: photo on brochure only showed the front - not identical
■ BUT Design was not distinctive: the photo shows the overall impression
■ WoT also not entitled (not creator or assigned)
s 17: Certain things to be disregarded
● S 17(1): (new): If a relevant entity publishes/uses in grace period, and then after that, a 3rd party publishes/uses the
design, the 3rd party is presumed to have derived from the relevant entity (within 6 months of public exposure)
s 18: certain designs not to be treated as other than new and distinctive (design/copyright overlap)
Grace period: protect designers that inadvertently publish designs before application for design rego. (accidental or ignorant)
● Designs amendment Act 2021 (Advisory Council on Intellectual Property Response)
● Must be filed within 12 months of disclosure
● S 17 (1) - excludes prior art base publication (use in 12 months before priority date by owner, predecessor in title or
creator)
○ Rebuttal - if owner publishes/uses during period and a 3rd party publishes/uses the design, 3rd party is
presumed to have derived it from the relevant entity
Not registrable: s 43 (1)
a) Violating regulations
b) Replicating Olympic insignia s 18 (Olympic Insignia Protection 1987)
c) Integrated circuit (Circuit Layouts Act 1989) - including parts or masks
d) Order of s 108 (defence of commonwealth)
Registration:
● S 21: statement of newness and distinctiveness (optional)
○ Via Registrar of Designs Instruments 2022 (Forms and
means of filing documents + Formal Requirements)
● S 27 - priority date
● S 25 - certificate of registration (if minimum requirements met,
design will be published)
● S 33 - 6 months from priority date to request registration or
publication, otherwise lapsed
● S 73(3) - cannot sue for infringement of design until examined
and certificate issued
● S 65 - examination
● S 67 - certificate of examination
● S 93 - revocation
22
Ownership: s13
● Person mentioned in paragraphs are entitled to be entered on the Register as the registered owner of a design that
has not been registered:
○ Created the design (designer) - no statutory definition
■ Person who conceives the design and reduces it to visible form (authorship) - Chris Ford
Enterprises Pty Ltd v BH&JR Badenhop Pty Ltd (1985) 4 IPR 485
○ If under employment or contract → other person unless agreed prior (e.g. commissioning client)
Case:
1.
LED Technologies v Elecspess Pty Ltd (2008) 80 IPR 8 - employee made sketches of LED lamps,
○ Independent contractor (M) made computer aided designs + 3-D models
○ Held: LED employee was creator → person whose mind conceived the relevant shape, configuration,
pattern or ornamentation to the article in question and reduces it to visible form (via Chris ford case)
■ M not designer, just converted to electronic form for production
■ Under s 13 (1) (b), employer company was entitled to be registered as owner (commissioning
client owned design rights aka employee Mr Ottobre)
Rights of design owner: s 10
Exclusive right during term of rego:
a. To make or offer to make product - must embody design and it is registered as
b. Import product to Aus for sale or other purposes of trade or business
c. Sell, hire, dispose of product
d. Use for purposes of trade or business
e. Keep products for c & d
f.
Authorise another to do a - e
Assignment and licensing:
● S 10 (2) - exclusive rights - personal property & capable of assignment and of devolution by will or operation of law
● S 11 - assignment must be in writing, signed by or on behalf of assignor + assignee
● S 90 - Design being applied overseas and is not being applied to a reasonable extent in Australia s 90(3)
Infringement: ss 71 & 73
1. A person infringes a registered design if, during the term of registration of the design, and without licence or authority
of the registered owner of the design, the person does something within the exclusive rights of the owner.
● Primary infringement (a)
a. Makes or offers to make a product, in relation to design is registered, which embodies a design,
that is identical to or substantially similar in overall impression
● Secondary infringement (b to e)
Under s 19 factors, substantial similarities in overall impression of registered design
Must follow:
● S 71 - identical OR substantially similar in overall impression
● S 19 (s 71 (3)) - Court consideration
○ more weight to similarities vs. differences
○ state of development of the prior art base
○ statement of newness and distinctiveness (if not present, appearance of design as a whole)
○ If only part of design is substantially similar → regard to amount, quality and importance in context of
design as a whole
○ Freedom of creator to innovate (high freedom = a lot of room to make changes, low freedom = low options)
○ Standard of familiar person (objective standard)
23
Case: Using an informed user
Pre-2021 test
1. Dart industries Inc v The Decor Corp Pty Ltd (1989) 15 IPR 403 - plastic bowl lettuce keeper design
○ Held: no infringement - small differences between registered design and prior art will generally lead to
finding no infringement if there are equally small differences between registered design and alleged
infringing article.
■ On the other hand, the greater the advance over prior art will most likely find common features
thus infringement would more likely be issued
2. Review 2 Pty Ltd v Redberry Enterprise Pty Ltd [2008] FCA 1588; (2009) 79 IPR 214 - designer dress. Informed user
(not an expert, barely informed → focus of consideration was eye appeal vs. internal visible manufacturing features
○ Argued that Review skirt colour + pattern gave design a different overall impression from prior art
○ Redberry had a different shaped skirt (floppy/blousy) = no infringement
3. Multisteps Pty Ltd v Source and Sell Pty Ltd [2013] FCA 743 - alleged infringement of food packaging
○ Notional person has to be familiar with produce but not a user (normally consumer)
○ ⅓ registered designs was infringed
New test: familiar person (post 11/9/2021)
Problem - applying competing interpretations of the informed user
● EU - identified users of design → identified informed user vs. Multisteps Case approach - don’t need to be a user
● Amendment = Multisteps case approach (does not require the person to be a user … standard is that they are familiar
with the product or similar ones. Familiarity gained through use but does not need to be a user of the product.
Standard to be flexible to incorporate views of consumers, experts and skilled users)
Case: Familiar person test
Examples of infringement
1. Keller v LED Technologies Pty Ltd [2010] FCAFC 55 - rear tail lights, LED sued number of businesses for importing
lights to Condor range
○ Condor products made overseas were based on LED idea → cheaper production
○ Held: Infringement on LED’s registered design → was substantially similar in overall impression (mass
production in violation)
2. LED Technologies Pty Ltd v Baxter/Roadvision Pty Ltd [2012] FCAFC 3 - Baxter denied infringement → countered
that LED’s design was not new or distinctive
○ Held: LED designs were validly rego’d
■ No design infringement since Taiwanese manufacturer made adjustments before Baxter
imported them → not substantially similar in overall impression (changing sequence is valid =
no design infringement)
3. ​Hunter Pacific International Pty Ltd v Martec Pty Ltd [2016] FCA 796 - ceiling fan hub
○ Although different in shape and configuration, via s 19 - more weight given to similarities than differences
→ insufficient to displace ‘significant and eye catching similarities’
3-D printing (infringement?)
Is there infringement of the registered design if…
Scanning to create a CAD file?
● no making of a product
● But if there is use of the product in any way for the purposes of any trade or business (yes)
3D printing of the product? - Yes; makes the product
Not infringement
● Parallel importation with permission: s 71(2)
● Prior use (new)
○ Infringement exemption If a 3rd party starts using a design (comparable design) before the priority date of a
registered design.
■ This is because 3rd parties may not be aware of the designers intention to file a design application
within the 12 months grace period.
○ Protects designers who independently create but do not register a design, or someone who copied the
design before the priority date.
24
●
S 71 (A) - a person who starts using the design before the priority date of its application will be able to continue using,
making, importing and selling products in respect of which design is registered without infringing the design right
Spare Parts defence: s72
Provides defence for manufacturers and suppliers of spare parts
Case:
1.
GM Global Technology Operations LLC v SSS Auto Parts Pty Ltd [2019] FCA 97 - spare parts to upgrade base model
commodores → SSS used spare parts defence i.e. parts sold for repair
○ Held: no design infringement → onus (responsibility) on design owner to prove SSS to have known the
spare parts were not for repair purposes. Holden failed in this aspect
■ S 72 defence does not require a party to ‘maintain control over the parts after its importation,
sale or keeping to make sure it is ultimately applied to a vehicle for repair or track the progress
of goods it sells through the supply chain’ → focus on intention of importer/seller not buyer
Enforcement:
● S 73(1) the registered owner of a registered design may bring proceedings against another alleging infringement.
● S 74: defendant can counterclaim for revocation of the design registration
Design amendment (new) - Advisory council on Intellectual Property Response Act 2021
● Under schedule 5 - Exclusive licensee will have the right to bring infringement actions, the owner will have to be
joined in proceeding - From 10 march 2022
Remedies: Injunction, Damages or accounts of profit or Additional damages for flagrant infringement
● Court may refuse to award damages of account of profits or reduce the damages if innocent infringement (s 75(2))
○ Test based on s 75 (2)
(new) - Advisory council on Intellectual Property Response Act 2021
● Extends the current innocent infringer defence to provide relief from infringement to 3rd parties who may
unknowingly infringe a design in the period between filing and registration dates (approx 6 months)
○ This is a period when the design is not publicly available in the register of designs
Enforcement:
● Unjustified threats: s 77
● Offence if person represents design is registered and know or is reckless as to whether the representation is false: s
132
25
Trade Secrets/Confidential Information
Materials included: personal information, technical knowhow, product/TV programme/advertising ‘ideas’, customer list, recipe
and government secrets.
● Confidential information is not a property right. Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2) (1984) 156 CLR
414 → look for other IP
Confidential information vs. Patent
Advantages
●
●
●
●
●
includes a mere idea (no other ip category protects a
mere idea)
includes material that does not constitute a
patentable invention
cheaper (no registration; but must take steps to keep
it secret)
no requirement to disclose the information as
required under patent
no limit to term of protection provided secrecy is
maintained (patent has 20 year term only)
Disadvantages
●
●
●
does not prevent independent creation by
others (someone can replicate information
through other means and you have no
recourse)
does not prevent reverse engineering once the
idea/product is in the public domain
protection is lost when disclosure occurs
Confidential information: can be used to supplement patent protection (knowhow) or as part of a range of ip protection when
licensing (eg franchising)
● Potential to argue in circumstances that would be covered by a right of privacy in other countries (no tort (legal
wrong) of invasion of privacy in Aus
● IP often used as basis to prevent certain events from occurring (act of suing)
Case:
1.
2.
ABC v Lenah Game Meats [2001] HCA 63 - Animal right group secretly filmed Lenah’s licensed possum meat
abattoir by installing a camera and later removing it. Film was provided to ABC to broadcast. Lenah sought
injunction against ABC (privacy and confidential information).
○ No tort of invasion of privacy in Aus. filmed activities were not a trade secret as it was public knowledge
of their operations - confidential information argument was not held
Tom Cruise and Nicole Kidman v Southdown Press Pty Ltd (1993) 26 IPR 125 - applied for injunction of (right of
privacy, breach of confidence, defamation, breach of copyright) against published photos of their adopted children.
○ All unsuccessful as no evidence of how photo was obtained, no copyright ownership & no right of privacy
in Aus
Lower courts that did recognise the right:
3. Doe v ABC [2007] VCC 281 - ABC liable for breach of privacy and confidence when broadcasting improperly
disclosed info about rape victim (SGB&L p 80)
4. Campbell v MGN Ltd [2004] 2 AC 457 - Naomi Campbell emerging from a narcotics anonymous meeting
○ In UK due to being in a different jurisdiction, human right legislation - breach of confidence protects
misuse of private info → Held to be an invasion of privacy
Term: Term of obligation of confidence depends on the source of obligation of confidence
● If contract provisions (express or implied)
● If under the law of equity: obligation lasts as long a the material remains not public
● If a statutory obligation: depends on the terms of the statute
Sources of obligation of confidence
Obligation may arise under:
● Contract: Non-disclosure agreement (NDA) or Employment contract
● Equitable obligation
● Statute (commonwealth/state privacy legislation, directors duties corporations Act: s183)
Contractual obligation of confidence may be: Express or Implied term
26
Contract: Express
● NDA → contract between 2 parties engaging in a collaborative venture
● Limitation: restraint of trade
○ Restraint of trade clause: term in a contract by which by which party agrees to refrain from some activity
that they would otherwise be free to engage in to keep certain information confidential.
■ A contractual confidentiality obligation will not be enforceable if it amounts to an unlawful
restraint of trade
■ A restraint of trade provision is lawful if it reasonable as between the parties and in the public
interest
Case:
1.
Maggbury Pty Ltd v Hafele Australia Pty Ltd [2001] HCA 70 - Respondent signed NDA before entering intro
discussions about possible exploitation of Pl’s idea for a new design of a foldaway ironing board: HA ‘shall treat the
information as private and confidential’; HA ‘shall not at any time hereafter use the information for any purpose
whatsoever except with the inventor’s informed prior written consent’ and ‘It is a condition of this agreement’ that
HA ‘will forever observe the obligations of confidence set out in this Agreement, unless released from such
obligations in writing by the Inventor.’ Respondents used info for their own competing product on the market.
Applicant sought permanent injunction against Respondents confidential information
○ Held: unreasonable restraint of trade = unenforceable, the obligation would apply even after the
information was published as a result of a patent application being made by the applicant →
unreasonable to maintain confidentiality once info was public + NDA’s should be drafted carefully - must
be reasonable in scope and duration → indefinite confidentiality clauses + public info = most likely
unreasonable
Contract: Implied
Where no express obligation, an implied obligation may arise where it is reasonable and necessary to give ’business efficacy’ to
the arrangement.
Employee obligation of confidence: Express, Implied & Statutory obligation
Express term: Example from class discussion question about magic.
Implied term: While employed, an employee owes a duty of good faith and fidelity to the employer; employee must not act to
the detriment of the employers interests
● This is a stricter duty than the duty of confidentiality. But after employment ceases, the employer's rights have to be
balanced by the right of the employee to use their skills and knowledge.
Case:
1.
Ansell Rubber CO Pty Ltd v Allied Rubber Industries Pty Ltd [1967] VR 37- Ansell produced rubber gloves; the
technology had been partly revealed in patent specification; the machinery used to manufacture the gloves was
confidential; employees were told it was confidential and unauthorised persons were not admitted to the factory.
→ 2 employees (one current, one former) joined with Def co to make a competing product
○ Held: breach of obligation of confidence
■ As o the currency employee: struct duty of fidelity to employer
■ As to the former employer: implied term not to use information to the detriment of the
employer
How to identify the trade secret that is not considered part of the employees knowledge and skill?
Court looked at US restatement of tort elements:
● Extent to which information is known outside the employer’s business
● Extent it is known by employees and others involved in the business
● Measures taken to guard the secrecy of the information
● Value of the information onto the employer and employer’s competitors
● Effort nf money expended in developing the information
● Ease or difficulty with which the information could be properly acquires or duplicated by others
27
Case:
1.
Faccenda Chicken Ltd v Fowler [1987] 2 Ch 117 - Faccenda sold fresh chickens from refrigerated vans; Fowler was
sales manager; implemented a successful marketing schemeL there were defined routes servicing particular
customers, he knew there were requirements of customers and prices charged to each customer. Fowler resigned
and set up a competing business; hired some former employees, including a number of van drivers.
○ Held: Fowle free to compete and to solicit customers of Faccenda; he was using his own knowledge of
customers, prices etc (category 2 information)
3 categories of information:
1. ‘Information which, because of its trivial character or its easy accessibility from public sources of information, cannot
be regarded by reasonable persons or by the law as confidential at all’ - Employee not bound to keep it secret either
while employed or after.
2. Information the employee must treat as confidential during employment but which once learned, become part of the
employee's skill and knowledge, employees can use after employment has ceased
3. Specific trade secrets ‘so confidential that, even though they may necessarily have been learned by heart’ ; cannot be
used by employees during or after employment.
Case:
1.
2.
3.
NP Generations Pty Ltd v Feneley (2001) 80 SASR 151 - manager of real estate agency’s rental property business
had a rent roll of properties and owners during employment → all contacts and private info
○ Held: address book contained confidential information owned by employer
Woolworths Ltd v Olson (2004) 63 IPR 258 - sent info about supply chain strategy to wife prior to working for a
competitor.
○ Held: confidential information; evidence established that Woolworths regarded information as highly
sensitive and confidential.
Leica Geosystems Pty Ltd v Koudstaal (No 3) [2014] FCA 1129 - K was a software engineer who downloaded source
code and software information on customers prior to working for a competitor. LG sued for copyright infringement
and breach of confidence
○ Held: breach of confidence owed by K; not merely knowhow he was taking due to volume and complexity
of material → was ordered to deliver up the confidential info
Employees: confidentiality may be a statutory obligation
E.g. Corporations Act 2001 s 183 1.
1. A person who obtains information because they are,or have been, a director or other officer or employee of a
cooperation must not improperly used the information to:
a) Gain an advantage for themselves or someone else; or
b) Cause detriment to the corporation
Equitable obligation of confidence: In absence of formal agreement or when formal agreement is not enforceable
Has traditionally depended on there being an established relationship of trust and confidence.
But more recent authority indicates the obligation may arise by reference to the circumstances and not a pre-existing
relationship. May be enforced:
● Despite there being an express obligation that is more limited; and
● Where an obligation is unenforceable, for example, as an unreasonable restraint of trade
Case:
1.
Prince Albert v Strange (1849) 47 ER 1302 - Prince Albert prevented the defendants from exhibiting and copying
impressions of his and Queen Victoria’s etchings, obtained through a printer’s employee
Absence of contractual relationship between discloser and disclosee
2. Saltman Engineering CO Ltd v Campbell Engineering CO Ltd (1948) 65 RPC 203 - Saltman owned drawings for the
manufacture of leather punches; it had a 3rd party arrange with campbell for campbell to manufacture the leather
punches; Campbell used the drawing for the manufacture of leather punches for other customers
○ Held: was a breach by Campbell of an obligation of confidence → did not need to prove contract = no
direct contact between Saltman and Campbell (Cause of action = equitable not contractual)
28
Nature of the cause of action
3. Seager v Copydex Ltd [1967] 2 All ER 415 - Seager invented and patented Klent carpet grip + Invisigrip (not
patented). Seager mentioned invisgrip and while their negotiations of marketing Klent went south, Copydex
manufactured invisigrip
○ Held: breach of obligation of confidence - ‘depends on the broad principle of equity that he who has
received information in confidence shall not take unfair advantage of it. He must not make use of it to
the prejudice of the person who gave it, without obtaining his consent. The principle is clear enough
when the whole of the information is private. The difficulty arises when the information is in part public
and in part private. As for instance in this case.’ → Obligation was imposed even here where Copydex
subconsciously copied (court accepted that Copydex employees thought the idea was their own, but
similarities were too great to be a coincidence)
Elements of equitable obligation:
● The information has the necessary quality of confidence about it
● It was ‘imparted in circumstance importing an obligation of confidence’
● There is (actual or threatened) unauthorised use to the detriment of the party communicating it
Note: skills, experience and knowledge gained from employment can be used/applied freely
Case:
1.
Coco v AN Clark (engineers) Ltd [1969] RPC 41 - Designed Coco moped (scooter) where they entered negotiations
with AN clark. AN clark designed their own mopeds incorporating some features from Coco’s + own developments
and called it Scamp mopeds
○ Held: breach of obligation of confidence under all 3 elements
Element 1: Information of a confidential nature
● Must have the necessary quality of confidence
● Will not be protected as confidential information if it is ‘public property/knowledge’
● Must be reasonably ascertainable and identifiable.
● Does not have to be in writing; can be oral
● Does not have to be original or novel
○ Test is not as stringent as test for novelty in patent or new or distinctive in design
○ If product is on the market and can be reverse engineered, it is no longer a secret
○ Not secret of there is a patent for the product or process
Relative secrecy: Can be known by a few only and remain secret
Case:
1.
AFL v The Age Co Ltd 92010) 265 ALR 281 (SG&B 99) - speculation on internet discussions of certain players alleged
to have tested positive to illicit drugs.
○ Held: not to have destroyed the confidentiality of the test results so AFL was able to restrain media
outlets from publishing results
Parts/elements of the information may be public, but the combination may still be confidential
2. Falconer v ABC (1991) AIPC 90-849 Supreme Court of Victoria - Vlado Rajicic was an informer and sent to witness
protection program. ABC released a report on wpp and used his photo. Police sought and obtained interim
injunction but since photo was taken by police and intro’d it to committal hearing (ABC got from lawyers), ABC
argued it was public photo vs. Police argued that photo + info that depicted VR was combination and confidential
○ Held: photos were confidential as not published in newspaper, parts/elements of the information may be
public but the combination may still be confidential --> threatened the reputation of the wpp thus the
judge determined that it was not appropriate to allow it to continue
3. Talbot v General Television Corp Pty Ltd [1980] VR 224 - PI submitted under confidential submission of idea for
show, Channel 9 advertised segment with the same idea
○ Held: breach of obligation of confidence, injunction granted as idea/theme of programme was known but
recipe was new → Damages received = $15,000
29
Coco v AN Clark (engineers) Ltd [1969] RPC 41 - how to avoid breach of confidence
● Commission 3rd party ‘to make the discovery anew’? (artificial)
● Ignore obligation → use info & pay damages for use
● Withdraw from field until info is public
Court will assess either:
● Use of information without consent = injunction
● Use without paying reasonable sum = damages (preferred in industry/commerce)
Case:
1.
Foster v Mountford (1977) 14 ALR 71 - tried publishing a book on Nomads of Australian Desert. Aware of the
importance of cultural significance as it was of special nature in the area. → interlocutory injunction granted
Element 2: Imparted in circumstances importing an obligation of confidence
Reasonable person test: circumstances such that ‘any reasonable man, standing in the shoes of the recipient of the information
would have realised that upon reasonable grounds the information was being given to home in confidence’
● Where information of commercial or industrial value is given on a business like basis
Obligation cases indicate you do not need to establish a pre-existing relationship of trust and confidence for the obligation to
arise… (circumstances that info was acquired > pre-existing relationship)
No prior relationship with disclosee
Case:
1.
Creation Records v News Group Newspapers Ltd [1997] EWHC Ch 370 - Oasis band shoot at hotel. Sun newspaper
sent a photographer as a guest to get photos (limited knowledge as only few people knew). Argued breach of
copyright and confidence (security and closed shoot area)
○ Held: arguable case that there was a breach of confidence → freelancer had to act surreptitiously (knew
it was not permitted) = injunction against further publication until trial or new order
Eavesdropper
Case:
1.
Malone v COmmissioner of Police of the Metropolis (No 2) [1972] 2 AII ER 620 - Police lawfully tapped PI’s phone
○ Held: no obligation of confidence; person using phone takes risks of being overheard that are inherent in
the system + Also public interest as pl was engaged in criminal activities
Thief
Case:
1.
Franklin v Giddens [1978] Qd R 72 - selective bred new variety of nectarine trees in plaintiffs orchard were stolen
by the defendant to produce a new variety → nectaries were also sold by defendant. Def convicted of theft but pl
wanted to obtain trees that were grafted from Budwood and injunctive relief
○ Held: genetic structure of budwood = trade secret = injunction granted.
○ Thief who steals a trade centre, knowing it to be a trade secret, no less unconscionable than a traitorous
servant
Position of 3rd party to whom the party in breach discloses the confidential information? - the 3rd party to whom the person in
breach of obligation discloses information is bound once there is no notice of breach of obligation; → No matter how innocently
they acquire information.
Case:
1.
Wheatley v Bell [1982] 2 NSWLR 544 - 3 purchased franchises that breached obligation of confidence owed to pl;
argued that they were bona fide purchasers without notice of breach of confidence by the party
○ Held: the defence of ‘in good faith’ purchaser without notice is a defence were there are property rights,
but there are no property rights as such in confidential information
■ They were bound by the obligation once notified of the breach
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Element 3: actual or threatened unauthorised use to the detriment of the party communicating the information
● Does not need to be intentional unauthorised use
● Some cases question whether it is necessary for detriment to be shown
Scope of the obligation of confidence
Once elements 1, 2, and 3 are established, what is the scope of the obligations?
Case:
1.
Smith, Kline & French Laboratories (AUS) Ltd v The Sec of the Dept Community Services and Health (1991) APIC
90-821 - SKF were patentees of cimetidine (gastric ulcers) and sold under Tagamet & Duractin. Patent expired 1988
but is under application but not granted. 4 months later, Alphaharm applied for approval for the imported version.
When SKF applied, they provided info of studies and tests, Dpt proposed using this to Alphaharm for their own
application for marketing approval. SKF applied for injunction for info as confidential between dpt and SKF, what is
the scope of obligation by dpt?
○ Held: injunction rejected
■ not appropriate test where each party’s interest is quite different and known to be so
● obligation of confidence is based on broad principle of equity that ‘he who has
received information in confidence shall not take unfair advantage of it’ (Seager v
Copydex); can be no breach unless court concludes that a confidence has been
abused, that ‘unconscientious use has been made of’ the information
● Here, no abuse or unconscientious use: ‘substantial interference with vital functions
of government, in protecting the health and safety of the community’ would result if
SKF’s argument were accepted
○ Different interests, equitable obligation of confidence (must prove abuse of confidential info in
unconscionable manner) + significant public interest
Government information
Legislation covers: privacy, freedom of information. Public records, and official secrets and codes of conduct restricting
discourse by public servants.
● Otherwise, general law of confidential information applies
For government information there is change of onus in relation to the obligation of confidence: The public interest is in
government action being open to scrutiny, so government bears the onus of proving the public interest requires preventing
disclosure → must disclose info or significant harm can occur to public
Case:
1.
2.
Commonwealth v John Fairfax & Sons Ltd (1980) 32 ALR 488 - Publishing foreign and public policy documents
1968-75)
○ Held: Injunction granted on copyright infringement. No remedy to confidential info.
■ ‘The equitable principle has been fashioned to protect the personal, private and proprietary
interests of the citizen ... when equity protects government information it will look at the
matter through different spectacles. ... It can scarcely be a relevant detriment to the
government that publication of material concerning its actions will merely expose it to public
discussion and criticism ... Accordingly the court will determine the government’s claim to
confidentiality by reference to the public interest. Unless disclosure is likely to injure the public
interest, it will not be protected.’
Attorney-General (UK) v Heinemann Publishers Australia Pty Ltd (1988) 10 IPR 153 (Spycatcher Case – secrets of
foreign government) - injunctions against autobiography of former MI5 agent.
○ Argued breach of confidence, contract, fiduciary duties, harm to UK, efficacy of security + Aus
(contracted)
○ Wright argued info is old, published in books, articles and on TV + public interest on unlawful conduct by
MI5
■ Held: injunction failed, Aus court had no jurisdiction to enforce penal, revenue or public law of
foreign state (Official secrets Act) & info already public
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Defences to breach of confidence action: just cause or excuse for info disclosure
Two approaches;
● Iniquity rule (no confidence in an iniquity i,e, crime, wrong or misdeed of public importance)
● Balancing the public interest in disclosure with the public interest in preserving confidentiality
Cases indicate the wider balancing of interest defence is not available in Australia
Iniquity rule: e.g. where fraud, breaches of national security, breaches of law (if relates to crime or significant public interest =
right to disclosure)
Case:
1.
Lion Laboratories Ltd v Evans [1984] 2 AII ER 417 - internal documents questioned reliability of breathalyser
(Intoximeter) for cops → newspaper intend to publish
○ Held: court refused injunction as disclosure justified
Disclosure under legal compulsion - e.g. court order or legislation
Remedies: Only the party to whom the obligation is owed may sue; not the arty owing the obligation
Case:
1.
1.
2.
3.
Fraser v evans [1969] 1 QB 349 - Consultant employed by the Greek government unable to prevent publication of
a leaked copy of his report. The obligation of confidence as to the contents of the report was owned by the
consultant to the Greek government and only the Greek government could seek a remedy.
Plaintiff will usually be seeking an injunction to stop disclosure
Other remedies: damages or accounts of profits
Springboards: remedy may be an injunction for a period (for the period of springboard advantage)
Case:
Springboarding = injunction
1. Terrapin Ltd v Builders Supply Co (haye) Ltd [1978] RPC 375 - Pl marketed prefabricated portable building +
brochure, def used confidential info from pl.
○ Held: Breach → time taken to develop product too fast → Person obtaining personal information is not
permitted to use it as a springboard or head start for activities detrimental to the owner
■ Must deprive violator of the headstart they obtained via breach
Remedy
2. Seager v Copydex Ltd - subconsciously copied idea = breach → awarded damages
3. Coco v AN Clarke (engineers) Ltd - injunction refused, arguable case but opted for damages or account of profits
was sufficient
Examples of breach of confidence:
Case:
Springboarding = injunction
1. Sports Data Pty Ltd v Prozone Sports Australia Pty Ltd [2014] FCA 595 - SD supplied statistics for NRL from
2002-2013. Prozone won their contract
○ SD applied for injunction vs. Prozone. Breach of confidential info + copyright
■ CI: How was template developed so fast without access to SD info (used SD info to springboard)
■ Copyright: both templates similar
○ Court = prima facie (sufficient evidence) that P had some SD info
○ CI attack:
1. Information of confidential nature?
○ Must be able to identify with precision the info claimed to be confidential → SD
claimed compilation of events, claimed data was confidential on their website but
customers could access without seeing the notice = confidentiality not made clear. No
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2.
3.
●
Case:
1.
express terms of confidentiality made clear between SD and NRL clubs + no term in
arrangement made in early stages that they were in a Joint venture to develop the
system
Info imparted in circumstances importing an obligation of confidence?
○ No evidence of how info obtained
○ Could be innocent but P is not notified. They changed their position (relevant
consideration)
○ Delay in SD to enforce rights = weakens their case
○ Due to circumstances, doubtful SD is entitled to remedy
Unauthorised use
○ No clear evidence of using a full set of data, maybe some individual events?
Held: Balance of convenience factors in favour of rejecting injunction application → adverse
effect to NRL + Prozone BUT damages are sufficient remedy
Vasco Investment Managers Ltd v Morgan Stanley Australia Ltd [2014] VSC 455 - Former employees of Orchard
Funds Ltd. attempted to recapitalise, brought the idea to Morgan Stanley but did not agree with remuneration.
NDA sent by Vasco before meeting. MS assured they were not in the business of breaching confidentiality
agreements or stealing ideas
○ MS pursued project to recapitalise
○ Vasco sued for breach of obligation of confidence
○ Held:
■ Quality of confidence acknowledged
■ Communicated circumstances importing an obligation of confidence
■ MS misused the information → starting the project (key elements used without V’s consent
■ BUT court rejected claim for equitable compensation as Vasco failed to bring evidence of what
a willing buyer would pay for confidential info → problem with account of profits because MS
improved on project
● Quantum meruit claim (a claim for a reasonable sum in respect of services supplied to
the defendant) accepted by court = $1 mil or a 0.5% success fee (2014 IP Forum pp
77-78
International treaties & Developments: TRIPS Article 39
Other jurisdictions
EU: DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the protection of undisclosed know-how and business
information (trade secrets) against their unlawful acquisition, use and disclosure
US: : Defend trade secrets Act 2016 - adds civil liability to the current criminal penalties under the economic espionage Act
1996, operates alongside existing ‘patchwork’ state laws on trade secrets. Intended to address concerns about corporate
espionage and hacking by cyber-criminals.
Issues to consider: Startups/accelerator programmes, crowdfunding
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