Fishy Business — Bass Baked by ‘Stunning’ Appeal

Seafood Innovations Pty Ltd v Richard Bass Pty Ltd [2011] FCAFC 83 (30 June 2011)
Appeal from: Seafood Innovations Pty Ltd v Richard Bass Pty Ltd [2010] FCA 723
See also: Innovation Patents Flop Like Stunned Mullet

Infringement – claim construction – functional claim – whether ‘includes a pivotally moveable floor’ encompasses a mechanism in which this element is insufficient to perform a claimed function – meaning of ‘to allow’

Validity – fair basis – whether a single description of an apparatus comprising several integers can provide basis for claims to multiple inventions comprising different subsets of integers – whether claims including only a subset of integers required for a working embodiment ‘define the invention’

A full bench of the Federal Court of Australia, comprising (in the sense of ‘consists of’ – more on this definition later) Justice Dowsett, Justice Bennett and Justice Greenwood, has unanimously reversed the first-instance decision of Justice Spender (retired).

The Full Court has found:

1. claims 1 and 5 of Australian Innovation Patent No 2006100980, in the name of Seafood Innovations Pty Ltd (‘SI’) (the ‘first innovation patent’) to be infringed by Richard Bass Pty Ltd (‘Bass’); and
2. all claims of Australian Innovation Patent No 2008100126 to be valid (and also infringed by Bass).

As we reported last July, the innovation patents (which have the same descriptions, but different claims) relate to to a fish stunning apparatus including a fish stunning device, a fish guide and/or a fish delivery table.  Justice Spender found that:

1. claims 1 and 5 of the first innovation patent were not infringed by Bass, because the lowering of a chin plate or floor of the accused apparatus does not, in itself, allow or permit a fish to pass from the front to the exit of the device, as defined in the claims, but rather that, because additional components are involved, the mechanism in the Bass devices for achieving a unidirectional flow of fish is a substantially new or different mechanism to that of the first innovation patent (at [87]); and
2. the claims of the second innovation patent are invalid, and do not ‘define the invention’, because they omit elements that are necessary to make the invention work, i.e. how a striker operates to stop, hold, stun and release a fish, which His Honour stated ‘is the critical point which the [second innovation patent] must address, but is silent on this point’ (at [116]).

We commented in our original report that the finding on infringement appeared to be based on a particularly narrow construction of the claims in question, and that the finding of invalidity seemed more akin to inutility, or lack of fair basis, and that it would be interesting to see what would happen on appeal.  As indeed it is!

INFRINGEMENT OF FIRST INNOVATION PATENT

The only element of the claims of the first innovation patent in dispute was ‘integer 5’, namely:

wherein the fish guide includes a floor being pivotally movable between a first position and a second position, the floor moving from the first position to the second position to allow a fish to pass unidirectionally from the entrance to the exit.

Bass maintained, as Justice Spender had found, that its accused devices include a pivotally moveable floor (a ‘chin plate’) which moves from a first position to a second position.  However, they also include two other components: a cheek plate and a top plate.  These three components work together as a ‘sphincter’ to allow a fish to pass from the entrance to the exit of the fish guide.  Since it is not the floor alone that allows the fish to pass, so the argument went, the Bass devices do not infringe the claims.

On appeal, the court rejected this narrow construction of the claims of the first innovation patent.  As stated by Justice Bennett (at [24]): ‘the fact that the Bass devices utilise additional integers to create the means whereby the fish can pass does not avoid infringement. The claim requires the floor to move in order for that to happen. That is what happens in the Bass devices.’

Justice Greenwood provided further analysis:

If integer 5 is present within the impugned devices, the introduction into the devices by the respondents of other components will not render the devices non‑infringing devices.  At that point, there is no material differentiation in an essential integer of the claim but an adoption of the essential integer plus the addition of other features….  The question is whether the integer is present within the impugned devices, that is, does the pivotal movement of the chin plate from a first position to a second position so move to allow a fish to pass unidirectionally from the entrance to the exit? (At [77].)
…
It seems to me that “to allow” is used in the permissive sense of not preventing the transitional movement of the stunned fish to the exit point. … The reference to “to allow” in integer 5 does not suggest a foreclosure of the scope of the invention to one where the sole mechanism or means by which a fish is allowed to pass unidirectionally from the entrance to the exit is the downward movement of the floor plate to position 2.  The claim is not to be construed as introducing such a limitation. (At [83].)

Justice Dowsett concurred with the finding of the other two judges.

VALIDITY OF SECOND INNOVATION PATENT

On appeal, Justice Bennett appears to have treated the grounds on which the claims of the second innovation patent were found invalid as principally a lack of fair basis, due to the absence of ‘integer 5’.  Her Honour addressed the primary judge’s finding that the claims failed to disclose all of the elements necessary to make the apparatus ‘work’, and stated that:

The primary judge seems to have considered the claims of the second innovation patent by reference to the claims of the first innovation patent.  That is not relevant either to the ground of failure to define the claim or to an alleged lack of fair basis. (At [33].)

Bass argued that the pivotally moveable floor present in integer 5 of the first innovation patent is an ‘essential integer’ of the invention which must be included in the claims. On the other hand, SI argued that the description of such a fish guide is but one embodiment of the apparatus broadly described, without any such limitation.

Based on the High Court’s decision in Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 1) [2004] HCA 58, Justice Bennett noted that:

It is necessary to examine the body of the specification in order to see what it describes as the invention. In doing so, it is wrong to employ an ‘over meticulous verbal analysis’ or to seek to isolate in the body of the specification “essential integers” or “essential features” of an alleged invention and to ask whether they correspond with the essential integers of the claim in question. The requirement for a real and reasonable [sic] clear disclosure does not limit those disclosures to a preferred embodiment. (At [35].)

Her Honour then applied this to the second innovation patent, stating (at [39}:

The specification quite clearly describes an apparatus consisting of defined integers. There may, however, be variation within those integers. A reading of the whole of the specification does not support Bass’ contention that specifically described possible embodiments limit the broader embodiment of the apparatus. Bass’ analysis seeks to isolate essential integers from the body of the specification in understanding the described invention. … As is apparent from Lockwood (No 1), a narrow embodiment of a broad claim does not render the claim invalid for lack of fair basis. A claimed invention within the scope of the broadest description of the invention in the specification is fairly based.

Bass further argued that SI was not entitled to claim a monopoly for all fish stunning devices in which a fish moves unidirectionally from the front entrance to the rear exit, irrespective of the technical method for achieving that result, as claimed in the second innovation patent.  Justice Bennet rejected this argument also (at [41]):

… there is no requirement that the means of achieving that result must be included in the claims, although there is a requirement for sufficient description of the invention, including the best method, in the specification (s 40(2)(a) of the Act). That is not in issue in the appeal. Bass’ submission really involves an attack on the innovative step of the claimed invention and whether or not it is a patentable invention.

We note that, at first instance, the claims were found to be novel, and to involve an innovative step.

The question of whether or not the claims ‘define the invention’ was more swiftly dealt with, Justice Bennett finding (at [45]) that:

The monopoly is as set out in the claims. The fact that the claims (in contrast to the specification) do not give instructions for use of the apparatus is not a basis for invalidity for failure to define the invention for the purposes of s 40(2) of the Act.

Justices Dowsett and Greenwood both concurred with the findings of Justice Bennett on validity.

COMPRISING (IN THE SENSE OF ‘CONSISTS OF’)

One slightly disturbing aspect of Justice Bennett’s opinion is the repeated references to ‘comprises (in the sense of consists of)’, at [36]-[37].  It is not clear why Her Honour considers this use of ‘comprises’ to be exclusive, rather than inclusive, in scope, although we can only assume that Bass pressed for this construction.

The narrow construction of ‘comprises’ does not appear to have affected the outcome, but it continues to be a concern that Australian courts consider that the terms ‘comprises/comprising’ may, depending upon the context, be synonymous either with ‘includes’, or with ‘consists (only) of’.  Australian practitioners need to remain vigilant as to the use and treatment of these terms in patent specifications filed in this country.

COMMENT

We suggested in our report of the first instance decision that Justice Spender may have been influenced by an apparently deliberate strategy by SI to compensate for perceived weakness of the first innovation patent by filing a new application with claims drafted in view of the alleged Bass infringement.  The second innovation patent was not granted until the infringement proceedings against Bass were already underway.

In construing the claims of the first innovation patent narrowly, and applying an unduly strict interpretation of the requirement of the claims of the second innovation patent to ‘define the invention’, Spender J may have felt that he was delivering justice to Richard Bass.  However, the Full Court on appeal has concluded that he did not decide the case in accordance with the law.

We have also suggested previously that there may be a tendency for the courts to apply a narrower construction of claims of innovation patents when considering infringement, as a form of ‘natural balance’ to the almost unassailable validity arising from the low ‘innovative step’ threshold.  However, this decision confirms that the approach to claim construction for innovation patents in no different to that applied to standard patents.

Bass may now seek leave to appeal to the High Court, although we doubt that it would be inclined to take the case following a unanimous decision in this appeal, which appears to be soundly based on existing High Court authority.

Tags: Appeal, Australia, Infringement, Innovation patent, Validity