Valid ‘Notional Claim’ Required for ‘Whole of Contents’ Novelty Test

Danisco A/S v Novozymes A/S (No 2) [2011] FCA 282 (29 March 2011)

Novelty – ‘whole of contents’ citation – requirement for drafting of ‘notional claims’

There is much to mull over in this decision of Justice Bennett, which spans 378 paragraphs plus a 40 paragraph primer.  However, in this article we wish to focus on just one aspect of the case, which we consider may have significant implications in a number of areas of Australian patent law and practice, including:

1. the way in which patent applications are examined by the Patent Office;
2. the way in which applications are prosecuted by applicants and their agents;
3. the conduct of patent oppositions and revocation actions; and
4. the effect of some of IP Australia’s proposed patent law reforms.

The issue relates to the so-called ‘whole of contents’ novelty test.  While this does not commonly arise, in our own practice we generally see a handful of applications each year where objections are raised on this basis, so it is certainly not insignificant.

A ‘whole of contents’ ground of rejection (or invalidity) of a claim arises when an Australian patent application is identified which has an earlier priority date than the claim, but which was not published until after the priority date of the claim.  Such an application is not prior art by virtue of publication, however it may represent prior rights by another applicant to claim the same invention.

According to the ‘whole of contents’ novelty rule, this type of prior application can be used as the basis for rejection of claim due to lack of novelty, but not for lack of inventive step (or obviousness).  During prosecution of applications the usual practice is simply to treat the ‘whole of contents’ reference just as any other prior art document for novelty purposes, but to disregard it for the purposes of assessing inventive step.

However, according to Justice Bennett this approach is a form of ‘shortcut’ that is not legitimate under the current law.  Rather, in order to establish lack of novelty on a ‘whole of contents’ basis, it is first necessary to establish that a valid ‘notional claim’ can be drafted in relation to the prior application that encompasses the information relied upon for the ‘whole of contents’ objection.

‘WHOLE OF CONTENTS’ PRIOR ART

Prior to the commencement of the Patents Act 1990, the Australian law incorporated a ‘prior claiming’ approach to the prior art effect of unpublished patent applications.  According to this approach, a patent claim would not be invalid in view of an earlier, but unpublished, application unless the earlier application included a claim having overlapping scope.  The change in this approach introduced by the 1990 Act was in response to the Industrial Property Advisory Committee (IPAC) report, Patents, Innovation and Competition in Australia, 1984.  The IPAC report (in section 7.3) stated that:

This prior claiming approach has proved to be unsatisfactory in practice and, in our opinion, it is too narrow. In other countries there is adopted a relatively simple “whole contents” approach, under which any disclosure contained in an earlier specification … may be relied upon as an anticipation for determining novelty but not obviousness. We are of the opinion that this approach should now be adopted in Australia…

While IPAC considered the ‘whole contents’ approach to be ‘relatively simple’, in practice there are some potential complications.  For example, the prior specification in question may be associated with an application that claims priority from an earlier application, such as a foreign application in another country party to the Paris Convention.  Since the content of the priority application may be different from that of the subsequent Australian application, it is possible that not all of the information disclosed in the unpublished Australian patent application was also present in the earlier application.  It is also possible that a patent specification may be amended between filing and publication.  Nonetheless, it is necessary to associate a specific date with any information that might be ‘whole of contents’ prior art.

The solution to this problem adopted in the Australian law is to associate a ‘priority date’ with all information disclosed in a prior Australian application.  However, ‘information’ does not itself have a ‘priority date’.  Under the Australian Patents Act only a claim can meaningfully be assigned a priority date.  In order to associate a date with any information in an unpublished application, the Act introduces the concept of a ‘notional claim’, through the definition of ‘whole of contents’ prior art information in paragraph (b)(ii) of the definition of ‘prior art base’ in Schedule 1 to the Act:

…information contained in a published specification filed in respect of a complete application where:

    (A)  if the information is, or were to be, the subject of a claim of the specification, the claim has, or would have, a priority date earlier than that of the claim under consideration; and

    (B)  the specification was published after the priority date of the claim under consideration; and

    (C)  the information was contained in the specification on its filing date and when it was published.

The concept seems simple enough – if someone could have claimed the ‘same’ invention, with an earlier priority date (whether they actually have or not), then the claim at issue is not novel.

THE ‘NOTIONAL CLAIM’ MUST BE VALID

The ‘relatively simple’ whole of contents approach began to lose its simplicity with the decision of Justice Emmett in E I Du Pont de Nemours and Company v ICI Chemicals & Polymers Limited [2005] FCA 892.  At paragraph [81] of that decision, his Honour noted that there are two possible interpretations of paragraph (b)(ii)(A) of the ‘prior art base’ definition:

1. having identified a relevant piece of information, consideration is then given to whether that information was present in a document that would take priority over the claims under consideration; or
2. having identified a relevant piece of information, consideration is then given to whether that information is the subject of an actual claim. If the information is the subject of an actual claim, consideration is then given to whether the claim would take priority over the claims under consideration. If the information is not the subject of an actual claim, consideration is then given to whether the information could be the subject of a claim. If the information could be the subject of such a notional claim, consideration is then given as to whether that notional claim would take priority over the claims under consideration.

He further concluded that:

One aspect of the second construction is whether any such notional claim needs to be capable of being characterised as a valid claim. That is to say, the question is whether such a notional claim would satisfy the requirements of s 40 in relation to the complete specification of the patent said to contain the relevant information.

Justice Emmett went on to reason that the requirement to determine a ‘priority date’ for the notional claim necessarily involved a determination of whether the claim would be ‘fairly based’ on the disclosure in the relevant application, and therefore that the second construction must be correct.

We would have to say, however, that on the face of it the first of the two proposed constructions seems much closer to the intent of the IPAC recommendation.

ONUS TO PROVIDE VALID ‘NOTIONAL CLAIMS’

The further contribution made by Justice Bennett in Danisco v Novozymes is to impose an onus on the party seeking to invalidate a claim on a ‘whole of contents’ novelty basis to actually provide one or more ‘notional claims’ for consideration.  According to paragraph [292] of the decision, Novozymes accepted ‘that it bears the onus of submitting notional claims for the purposes of its case on anticipation’ (emphasis added).

(We do not imagine that Novozymes simply accepted this proposition without some prompting by the court.  We hear that Justice Bennett is particularly proactive in directing litigants to resolve preliminary questions prior to trial, in order to expedite proceedings and enable submissions at trial be focussed on the main issues in dispute.)

Novozymes offered two alternative ‘notional claims’ in relation to the ‘whole of contents’ prior art document, both of which were found not to relate to information that would anticipate the claims of the patent in suit.  The second claim was also found not to be fairly based on the specification of the prior patent application (see paragraphs [307]-[321]).

‘WHOLE OF CONTENTS’ NOVELTY – THE PROCESS

In summary, the process required to establish the lack of novelty of a claim in view of an application with an earlier priority claim, on a ‘whole of contents’ basis, is as follows:

1. identify the information (let us call this ‘teaching’) in the prior art application that is said to anticipate the claim;
2. draft one or more ‘notional claims’ encompassing the teaching;
3. determine whether the ‘notional claim(s)’ are valid, i.e. satisfy the requirements of section 40 of the Patents Act; and
4. only if the notional claims are valid, assess whether the associated teaching anticipates the later claim.

This is hardly the ‘relatively simple’ approach adopted in other countries, and foreshadowed by the IPAC report!

POTENTIAL CONSEQUENCES

We opened this article by suggesting that this decision may have significant consequences in a number of areas of Australian patent law and practice, and we will now expand on this concern.

Examination Practice

The current guidance in the Australian Patent Examiner’s Manual on the ‘whole of contents approach’ is set out in Section 2.13.8.2.6, which states simply that:

In considering the novelty of a claim under the "whole of contents" approach, (see b(ii) of the definition of "prior art base" in schedule 1), the examiner must compare the claim being examined to the information contained in a single Australian specification meeting the requirements set out in 2.4 Novelty [i.e. apply the ‘reverse infringement’ test].

The decision in Danisco v Novozymes suggests that this is not correct.  The examiner should establish a prima facie case that there exists a ‘notional claim’ which is valid, which would have an earlier priority date, and which encompasses a teaching in the prior specification that anticipates the claim under consideration.

Prosecution Practice

Any applicant (or their agent) presented with a ‘whole of contents’ objection that does not follow the procedure outlined above may be entitled to (and, indeed, should) challenge the examiner to make out a proper objection in accordance with the law.

The onus does not lie with the applicant to ‘prove a negative’, by drafting a ‘notional claim’ and demonstrating that the corresponding teaching does not anticipate the applicant’s claim.

Opposition and Revocation Proceedings

An opponent or applicant for revocation of a patent who relies upon a ‘whole of contents’ citation will need to follow the process outlined above in order to make out its case.

Effect on Patent Law Reforms

IP Australia is currently proposing amendments to the Patents Act which would make substantive changes to the requirements under section 40.  The express intention of these proposed amendments is to impose more stringent requirements upon applicants, e.g. in terms of enablement and providing written description support across the full scope of the patent claims, in order for claims to be considered valid.

By definition, therefore, under the process required by Danisco v Novozymes, it is more likely that a ‘notional claim’ will fail to satisfy the enhanced section 40 requirements, such that the teaching in a ‘whole of contents’ citation is less likely to be available as prior art.

This outcome would be contrary to the overall thrust of the reforms, which is to strengthen the patent system by ‘raising the bar’ in relation to the substantive requirements for patentability.

SOLVING THE PROBLEM

The current definition of ‘whole of contents’ prior art information in paragraph (b)(ii) of the definition of ‘prior art base’ does not achieve the outcome intended by the IPAC recommendations.

In our view, this could be fixed by replacing the definition to include in the prior art base for novelty:

1. information in any specification associated with an Australian application that includes a claim to an earlier priority date than the claim under consideration, but which was published later than the priority date of the claim under consideration; and
2. information any specification associated with an earlier application (whether in Australia or elsewhere) from which the first-mentioned Australian application claims priority;
3. wherein the date of prior art effect of any such information is the date of filing of the earliest relevant application with a specification including the information.

An amendment along these lines would return the law to something more closely approximating the intent of the IPAC recommendations, and to the practice currently outlined in the Patent Examiner’s Manual.

Alternatively, in relation to the presently-proposed reforms, the Act could be amended to limit the requirements for validity of ‘notional claims’.  In line with the usual ‘reverse infringement’ test for novelty, it should be sufficient that the earlier specification provide an enabling disclosure in relation to a ‘notional claim’.  Enablement is generally sufficient for anticipation.  A ‘notional claim’ should not be held to all of the standards that must be satisfied by an applicant seeking a monopoly corresponding with the scope of the claim.

CONCLUSION

This appears to be another sad example of how the law, through convoluted statutory drafting and subsequent judicial interpretation, can drift a surprising distance from its originally-intended destination.

It is inconceivable that IPAC, or the legislature, could ever have intended the ‘relatively simple’ whole of contents approach to require a multi-step procedure involving the drafting of ‘notional claims’, and an assessment of their prospective validity under section 40 of the Patents Act.  We are unaware of any other country in which this is required and it is, frankly, quite ludicrous.

We hope that somebody takes action to fix this through appropriate amendment of the legislation.

Tags: Australia, Novelty, Validity, Whole of contents