21 June 2011

Choose Your Experts Well (or, How Not to Run a Patent Case)

VIP Plastic Packaging Pty Ltd v B.M.W. Plastics Pty Ltd [2011] FCA 660 (10 June 2011)

You might have thought that an inventor, or other employee of a patent-owning company, would make a poor ‘impartial’ expert witness in a patent infringement case.

You might also have thought that a relatively senior academic who has ‘published books and papers on engineering design theory, engineering education, the innovation process, and mechanical equipment research and development’ would make an excellent expert witness.

However, if you thought either one – or both – of these things, then you would be sadly mistaken, at least in this case, and under the law as it stands in Australia.

This Federal Court decision, of Justice Kenny, concerns a claim by VIP Plastic Packaging Pty Ltd (‘VIP’) that various claims of its Australian patent no. 2001235262 were infringed by B.M.W. Plastics Pty Ltd (‘BMW’).  For its part, BMW counterclaimed that the patent was invalid on various grounds, including lack of novelty and lack of inventive step.

The patent is entitled ‘Variable-length Dip Tube for a Fluid Transfer Container’, and the specification states that the invention relates to ‘container apparatus and more particularly relates to a variable-length dip tube suitable for connection to a pump or valve at an opening of a container.’

The technology, however, is not the aspect of the case that interests us.  Nor is the court’s entirely conventional application of the law relating to infringement and validity of the patent.  We are interested in the court’s treatment of the evidence provided by expert witnesses for the two parties, which was ultimately wholly determinative of the findings that BMW had indeed infringed the VIP patent, and that the patent is valid.

THE EXPERTS

The principal expert evidence provided on behalf of the patentee (VIP) was from two individuals associated with the company:
  1. Mr Mandile, the named inventor on the patent, and a former employee of VIP (now retired); and
  2. Mr McFadyen, a Senior Design Engineer at VIP, with a Bachelor’s degree in chemical engineering from the University of Sydney and around forty years’ experience in the packaging industry, who had assisted Mr Mandile.
Expert evidence was principally provided for BMW by:
  1. Professor Field, Associate Professor of Engineering at Monash University and engineering consultant.
On the face of it, one might expect the evidence of persons associated with a party to the proceedings to be treated with some caution, as compared with the evidence of an independent academic.

However, quite the opposite proved to be true in this case.  Indeed, the court was unequivocal in its dismissal of Professor Field’s evidence.

EXPERT EVIDENCE IN PATENT CASES

Under the Australian law, expert evidence is frequently crucial to the outcome of patent litigation.  In particular, the skills, knowledge and experience of the mythical uninventive skilled worker in the art are central to the key enquiries of claim construction (i.e. interpretation), comparison of the claims with the alleged infringement, interpretation of the prior art, and assessment of inventive step. 

Often, the party whose evidence is most persuasive on these matters will carry the day.  For the most part, the legal principles in relation to infringement, novelty, inventive step, and so forth, are well-settled.  But they typically require fact-based inquiries into relevant technical matters, and evidence – such as the manner in which a skilled person would interpret terms appearing in patent claims, or what a non-inventive person in the field would have done and what information they would have had regard to in trying to solve a problem – may therefore determine the ultimate outcome.

ADMISSIBILITY OF EXPERT EVIDENCE

Admissibility of evidence generally, and expert opinion in particular, is dealt with in the Evidence Act 1995 (“the Evidence Act”).

Regarding expert opinion (and as summarised by the court at [58]):
  1. Section 76(1) of the Evidence Act provides that ‘[e]vidence of an opinion is not admissible to prove the existence of a fact about the existence of which the opinion was expressed’;
  2. Section 79(1) provides, however, that ‘[i]f a person has specialised knowledge based on the person's training, study or experience, the opinion rule does not apply to evidence of an opinion of that person that is wholly or substantially based on that knowledge’;
  3. evidence that is not relevant is inadmissible: see s 56;
  4. however, under s 80, evidence of an opinion is not inadmissible only because it is about a fact in issue or an ultimate issue.
In other words, opinions are not facts, and are therefore not evidence, except where the opinions are based upon specialised knowledge, i.e. are expert opinions.

WEIGHT GIVEN TO INVENTOR/EMPLOYEE EVIDENCE

The courts have generally not excluded evidence that is of questionable independence, however they have tended to treat it with suspicion.

The High Court of Australia in Wellcome Foundation Ltd v VR Laboratories (Aust) Pty Ltd [1981] HCA 12 decided that evidence of the patentee’s process of developing a claimed invention is generally admissible, subject to the caveat that such evidence is ‘not always likely to be helpful’.  Citing this decision, Justice Kenny indicated (at [22]) that ‘[b]y the same process of reasoning, evidence of the inventor’s opinion as to the characteristics of a person who works in the art with which the invention is concerned is admissible, although the Court must assess such evidence carefully.’

The court was not, however, exactly spoilt for choice in this case.  As stated at [25], Mr Mandile and Mr McFadyen ‘were only two witnesses at trial who worked in the art or science with which the invention as claimed in the VIP Patent was concerned.’

In the event, the court was willing largely to accept the evidence of VIP’s experts.  Of Mr McFadyen, the Justice Kenny stated (at [34]) that ‘[n]otwithstanding that Mr McFadyen was, in this historical sense, associated with the invention and a long-standing VIP employee, he impressed me as a most reliable witness.’  Of Mr Mandile, her Honour said (at [45]) ‘[w]hilst I necessarily treat the inventor’s evidence cautiously, I would note that I found Mr Mandile to be a thoroughly honest witness who was plainly endeavouring to assist the Court as best he could.’

Mr Mandile’s evidence was considered pertinent to questions of the relevant skills and knowledge of the person skilled in the art at the priority date of the claims.  Mr McFadyen’s evidence was largely determinative of the outcome of the patentee’s infringement case.

INAPPROPRIATE EXPERT EVIDENCE INADMISSIBLE

BMW argued, in support of Professor Field’s evidence, that ‘just about any engineer with a basic knowledge of manufacturing techniques and a basic knowledge of mechanics of devices could be classified as a skilled addressee’.  The court rejected this proposition as ‘contrary to the evidence. (at [24]).

The following passage (at [76]) is typical of the court’s criticisms of Professor Field’s evidence:

… the opinions expressed in [Professor Field's evidence] are not shown to be wholly or substantially based on his specialised knowledge based on his training, study or experience.  Unless this is shown, then Professor Field’s opinion evidence is inadmissible.  Secondly, even if it is assumed that his opinion evidence is based on his training, study and experience as a mechanical engineer, it is an irrelevant opinion.  Professor Field is not a skilled addressee and he cannot therefore give a skilled addressee’s opinion.  As indicated above, Professor Field is unable, relevantly, to comment on the state of the relevant common general knowledge as at the priority date.  His field of training, learning and study is mechanical engineering but this is not the art in question.  An opinion based on this training, learning and study is not relevant to an issue in the case.  I would not, therefore, regard Professor Field’s opinion evidence … as relevant and admissible in this case.  If I were wrong about this, however, I would, for the reasons stated, accord his evidence less weight than that of Mr McFadyen, whom the parties accepted was a skilled addressee.

The court also noted, on more than one occasion, that common sense – to which Professor Field appealed in aspects of his evidence – is ‘not a relevant category of knowledge’ (at [69] and [72]).

Since BMW’s entire defence was founded on Professor Field’s evidence, it was, for all practical purposes, doomed to failure!

COMMENT

The purpose of expert opinion in patent litigation is to inform the court as to the relevant factual matters required to enable the legal questions to be decided.  Generally, these will include technical issues regarding the use of language in the patent specification and in the prior art, as well as the general state of knowledge and practice in the relevant field at the priority date.

The Federal Court has appeared, in recent times, to have become somewhat infatuated with the idea that an expert should preferably actually be a ‘person skilled in the art’, which we would have thought was unlikely since the same court has previously confirmed the generally hypothetical nature of this ‘person’.  Nonetheless, it is quite clear that an expert who has absolutely no relevant qualifications or experience in the field of the invention will be incapable of usefully informing the court in relation to the factual matters.

In this case, the best source of relevant information was the patentee’s experts, despite the fact that their lack of independence meant that their evidence had to be treated with caution.

If BMW had found themselves a more credible (and admissible) expert – even, perhaps, one of their own people – they might have been able to achieve a better outcome in this case.

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