17 June 2010

The Continuing Saga of Faked Korean Stem Cell Research

H Bion Inc v Commissioner of Patents [2010] FCA 539 (1 June 2010)

Summary: Application refused for an extension of time within which to appeal a decision of the Commissioner of Patents relating to acceptance of a patent under s49 of the Patents Act 1990.

Patentology does not require any special interest in cloning technology, or stem cell research, to recall the scandal that erupted back in late 2005 over faked research results published in the journal Science by Dr Hwang Woo Suk and his team from Seoul National University, claiming to have successfully obtained stem cells from cloned human embryos.  The controversy was covered extensively in the mainstream media (see, for example, this summary from the New York Times).

Of somewhat less general interest was the fate of international patent aplication no. PCT/KR03/002899, which included claims allegedly supported by those same falsified research results.

The international application entered the nation phase in Australian as application no. 2004309300.

On 12 June 2008, the application was advertised as accepted by the Australian Patent Office.  The statutory opposition period expired on 12 September 2008, with no opposition having been filed, and thus the Patent Office was obliged to seal the patent.

This was, naturally, a somewhat controversial case, and IP Australia (the government authority incorporating the Patent Office) took the unusual step on 24 September 2008 of issuing this statement justifiying its decision.  In short, IP Australia considered the issue of whether or not the claims were supported by accurate or falsified data to be one of utility, which is not a basis for objection by an examiner under the current Australian Patents Act 1990.  A patent application can be opposed on the ground of inutility, and a granted patent can be revoked by a court on grounds of both inutility and fraud or misrepresentation.

However, the patent was not subsequently sealed, and on 16 March 2009 (ie nearly six months later) IP Australia issued this further, terse, statement, indicating that "the Commissioner of Patents considers that acceptance of the Patent was invalid."  On this basis, acceptance was nullified, examination was reopened, and a further examination report issued.  This effectively "killed" the application, since the final deadline for acceptance of the application had expired on 28 November 2008, although we would suggest that if there was ever an incontestible basis for grant of an extraordinary extension of time, this must surely be it!

Notably, there is absolutely no basis in the Patents Act 1990 itself for this action by the Commissioner.  Indeed, the often-stated position of the Patent Office, in the event that an applicant ever wishes to place an accepted application back under examination, is that acceptance is irrevocable.

We thought that this was the end of the matter, until we noticed the recent decision of the Australian Federal Court in H Bion Inc v Commissioner of Patents.  We are not sure who is behind H Bion Inc, or what the relationship is between this company and the patent applicant, Seoul National University Industry Foundation, but would be very pleased to be enlightened.

In any event, it appears that H Bion is seeking to revive the patent by having the decision of the Commissioner of Patents overturned.  This particular proceeding relates to an application for an extension of time to appeal a decision of the commisioner that has been made pursuant to the Patents Act.  Any such appeal should have been filed by 31 March 2009, but H Bion did not file a motion requesting an extension of time until 21 May 2009.

This is where it starts to get confusing, so we will try to break down the Court's reasoning into logical steps:
  1. An appeal to the Federal Court is only available under the Patents Act in respect of prescribed decisions of the Commissioner that have been made under the Act.
  2. The Commissioner freely admits that the decision to nullify acceptance was not made pursuant to any power conferred upon her by the Patents Act.
  3. Therefore, an appeal to the Federal Court is not available under the provisions of the Patents Act.
  4. Since there was no "decision" under the Act, and thus no right to appeal under the Act, the request for an extension of time within which to appeal against a decision made under the Act must be denied.
We trust that this is all perfectly clear!

It seems that H Bion had only sought an opportunity to appeal under the Patents Act in case the Commissioner subsequently decided in the course of court proceedings that her decision had, in fact, been made pursuant to powers under the Act.  Since it is common ground that this is not the case, it does not appear that H Bion has actually lost any rights as a result of this decision.  It did, however, have costs awarded against it.

It appears that H Bion is still pursuing a separate application before the court, under alternative Australian legislation, seeking a declaration that the patent application was validly accepted on 28 May 2008, an order compelling the Commissioner to process the patent application in accordance with law, and an order setting aside the Commissioner’s decision.

So it appears that the saga is not yet over!


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