24 June 2012

Undefended Appeal from Opposition Decision a Fait Accompli

Scott v Icon Plastics Pty Ltd [2012] FCA 428 (27 April 2012)

Patent Opposition - Appeal to the Federal Court of Australia - outcome when neither the original opponent nor the Commissioner of Patents appears and no evidence before the court

Get Out of Jail FreeWe reported back in November 2011 on the success of Icon Plastics Pty Ltd in opposing the grant of a patent to Laurence Clifford Scott, on the basis that Scott was not entitled to the patent, because he was neither the inventor nor a legitimate assignee of the inventor. According to Icon, the invention disclosed and claimed in the application was actually devised by Icon General Manager Royston Douglas Bull (‘Bull’), had been misappropriated by Scott, and wrongfully made the subject of the application in Scott’s name.  (See ‘Stolen’ Invention Restored to Rightful Owner.)

Scott appealed the opposition decision to the Federal Court.  However, Icon Plastics declined to participate in the court proceedings, agreeing to submit to the court’s judgement (except with respect to any award of costs).

As in similar previous cases, the court was unable to uphold any ground of opposition in the absence of any relevant evidence having actually been adduced during the proceedings.

Therefore the appeal has been allowed, and the patent has proceeded to grant in Scott’s name.


The principles which apply to appeals from opposition decisions are well-established.  Essentially, an appeal is not a review of the Patent Office decision, it is a completely distinct proceeding in which the court considers the evidence and submissions of all participating parties, and reaches its own conclusions.

More particularly, as the court explains at paragraphs [10]-[14] of the decision:
  1. the Federal Court hears appeals from Patent Office opposition decisions de novo, i.e. as a new hearing without deference to the outcome or reasoning of the original hearing officer;
  2. the standard to be applied by the court is whether, if granted, the patent would be clearly invalid;
  3. the court’s task on appeal is not, therefore, to determine whether the patent is valid;
  4. the only evidence that the court considers in deciding an appeal is that tendered at the hearing and admitted by the court, i.e. evidence which was before the Patent Office in the original opposition proceedings is not available unless separately entered in the court proceedings;
  5. in the normal course, the opponent bears the onus of satisfying the court that the grant of a patent would be clearly invalid; and
  6. if there is no evidence capable of supporting the opposition, then the patent must be allowed to proceed to grant – while the court may refuse a patent application on any of the available grounds of opposition, the only grounds upon which the Court can act are those supported by evidence or those not requiring evidence.
As such, if the respondent declines to participate in an appeal, and the Commissioner of Patents elects not to appear, the outcome of the appeal is a fait accompli – the appellant must succeed.


In this case the Commissioner of Patents was joined as second respondent, however she was represented at the hearing of the appeal only to assist the Court if the occasion arose, and did not made any submissions regarding the appeal since ‘it [did] not, in the Commissioner's view, raise any matters of public interest’ (at [9]).

The outcome was therefore inevitable, requiring very little consideration by the court (at [15]):

Icon has neither tendered nor adduced evidence in support of any ground of opposition, including as to lack of entitlement. Neither Icon nor the Commissioner of Patents has made any submission in answer to the applicant. The authorities are clear that where there is “no evidence before the court capable of supporting any actual or potential ground of opposition, there is no basis on which the court can uphold any ground of opposition” …. The applicant has tendered a not-insignificant amount of evidence in support of the appeal, including evidence as to his entitlement. There is nothing before the Court that leads me to conclude that the patent would be clearly invalid if it proceeded to grant. Having regard to the nature of the appeal and the authorities, there is no occasion for this Court to undertake a detailed consideration of the merits of the opposition, none of which have, in any event, been pressed on the appeal.


When a successful opponent fails to defend an appeal of a favourable opposition decision, it is likely that the appeal will be allowed, and the patent will be granted as if it were never opposed.  The only exceptions may be if the Commissioner chooses to step in, and/or a ground of opposition is one which can be decided without evidence.

Indeed, in an earlier decision (Cadbury-Schweppes Plc v Effem Foods Pty Ltd [2006] FCA 1267, at [17]) the Federal Court expressly recognised that, in substance, the position on appeal with no opponent present is just as if there had been no opposition to grant in the first place.  It also noted, however (at [20]), that this does nothing to foreclose the question of validity of the patent in any future proceedings.  So while Scott may have his patent, it is quite likely that any attempt to enforce it would be met with a new challenge to its validity on grounds of lack of entitlement.

When the provisions of the Raising the Bar Act come into effect on 15 April 2013 (see Bar Raised, as IP Law Reforms Signed Into Law), the ‘benefit of the doubt’ standard applied in patent oppositions will be replaced by a ‘balance of probabilities’ test (see Patent Reform Exposed Part VII – ‘Search to Sealing, and Beyond…’).  This will require the court to weigh up whatever evidence is available to it, and to decide whether it is more likely than not that the patent is invalid, rather than whether it is clearly invalid, before upholding an opposition.

In a case such as this, the change in standard may alter the work that the court is required to perform, but is unlikely to affect the outcome.  The absence of evidence ‘capable of supporting any actual or potential ground of opposition’ may not, in itself, be a sufficient basis for the court to decide the matter – it may at least need to consider the applicant’s evidence and submissions on substantive grounds of opposition before reaching a decision.  However, with only one side of the case presented to the court, it is difficult to imagine the balance being other than in favour of the applicant.


Lester said...

Thanks for commenting on this case. It seems to me that a more important consideration at least in this case under the Raising the Bar amendments is that Scott's patent won't be able to be challenged on the basis of lack of entitlement. cf s22A - which is retrospective. Thus, the reasons for the lack of appeal to the Federal Court here are unclear.

Lester said...

...reasons for Icon's no-show, that is.

Lester said...

Depending on the circumstances, I guess fraud, false suggestion or misrepresentation will still be an option next year.

Lester said...

Ok, so the patent could be revoked but still be valid. I think I get it!

Patentology (Mark Summerfield) said...

My understanding is that s22A is intended to 'fix' the apparent problem which arose in Conor Medsystems, Inc. v The University of British Columbia (No 2) [2006] FCA 32 (http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/cth/FCA/2006/32.html).

In that case, there were joint patentees, but it was alleged that one of them could not trace its entitlement back to one or more inventors, even though the original work had been a joint project, and both patentees were perfectly happy with the ownership arrangement. It was suggested that the lack of a proper basis for entitlement by just one of the two parties meant that the grant of the patent was necessarily invalid, and that it was therefore liable to be revoked, even though the correct ownership could, in that case, be easily resolved by agreement between the joint owners.

A situation in which someone has allegedly 'stolen' an invention from another party, and applied in their own name, is clearly quite different.

What s22A says is that a patent is not invalid merely because of a deficiency in the chain of title. However, this does not cease to be an available ground of revocation under s138(3)(a), should this be appropriate in the circumstances of a particular case.

My guess is that Icon did not appear because of the cost of doing so. I doubt this patent is really worth that much to them.

Gavin said...

I think Robert Wood and Associates (lawyers for Icon) should probably contact their insurers...

Patentology (Mark Summerfield) said...

Why? There is no reason to think that Icon did not choose to withdraw from the proceedings, and instructed their lawyers accordingly.

It's not as if they just failed to appear. They made a formal application

Gavin said...

You'd hope it was an informed commercial decision, but opposition proceedings are pretty expensive too and Icon spent that money. Also, Icon appear to have filed a section 33 application (No 2012200685) in accordance with the Delegate's original decision which is now worthless because the decision has been reversed.

Icon could have tried to re-file the evidence from the opposition proceedings in the appeal as a cheap option. Worked for the Commissioner in Commissioner of Patents v Sherman [2008] FCAFC 182.

I just think there's a chance they stuffed it up.

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