17 April 2018

Australian Appeals Court Upholds Patent ‘Promise Doctrine’, but it’s a Question of What the Inventor ‘Intended to Do’

ESCO locking mechanismThe Australian Patents Act 1990 requires, in section 18(1)(c) and 18(1A)(c), that an invention must be ‘useful’ in order to be patentable.  This is also commonly known as the requirement for ‘utility’.  Failure to meet this requirement, i.e. inutility, is therefore a ground upon which a patent application may be rejected, or a patent revoked.  One of of the ‘rules’ that has been developed by the courts over the years for assessing utility is an obligation upon an applicant or patentee to satisfy any ‘promise’ that might be made for an invention in the patent specification.  This is sometimes known as the ‘promise doctrine’ – e.g. in Canada, where it was abolished last year by the Supreme Court.  I had been hoping that a Full Bench of the Federal Court of Australia might decide to do likewise, given that the opportunity had arisen.  In a recently-issued decision, however, it has unfortunately declined to do so: ESCO Corporation v Ronneby Road Pty Ltd [2018] FCAFC 46.

On the face of it, a requirement that an invention fulfil any stated promises does not seem unreasonable.  If, for example, an applicant falsely asserts that an invention is worthy of a patent, at least in part because it achieves some valuable improvement over its predecessors, and receives a patent on that basis, then the Patent Office has arguably been misled in its decision to grant the patent.  However, I do not see what this has to do with utility.  The Australian Patents Act 1990 provides a perfectly good mechanism for revoking patents that have been obtained by ‘fraud, false suggestion or misrepresentation’ in section 138(3)(d).  But if an invention is, in fact, useful for some purpose, and the patent specification otherwise meets all of the requirements for a valid patent, then it is difficult to see why the applicant’s choice to include – or not – some ‘promise’ in the specification should make any difference.

The position becomes even more fraught when a specification includes more than one promise.  This aspect of the utility requirement has not previously been conclusively addressed by the Australian courts – i.e. if a patent applicant makes multiple promises for an invention, it is necessary that all of those promises be met by the claims, individually and/or collectively?  The Full Court’s decision in ESCO Corporation has, at least, clarified this situation, with the court deciding that a claimed invention must indeed meet whatever promise(s) have been made for it in the specification.

However, this does not mean that resolving the question of utility is simple in any given case.  The court has explained that whether or not a relevant promise has been made and met must be addressed, by determining whether the invention as claimed does what it is intended by the patentee to do.  This necessarily involves an enquiry into the patentee’s intentions, through consideration of the specification as a whole, including the claims.  It is therefore not simply a matter of identifying some explicit, straightforward, statement in the specification that appears to make one or more ‘promises’ – as the court did (wrongly) at first instance in the ESCO case – and asking whether the claimed invention satisfies all of the stated ‘promises’. 

As a result of conducting the required enquiry, it can become apparent that the invention, as defined in a specific claim, or group of claims, was not intended to satisfy all of the ‘promises’ made in the specification.  In ESCO’s case this was necessarily so, because its application included two groups of claims defining different aspects of the invention (a component, and an assembly including the component, respectively) that might encompass different subsets of the advantages asserted for the invention as a whole.

So while I would have liked to see Australia follow Canada in cutting ties with old UK law and abandoning the ‘promise doctrine’, the Full Court in ESCO Corporation has at least brought some much-needed sense to the Australian law.  Determining whether or not an invention is ‘useful’ is not some formulaic exercise involving the mere comparison of statements in the specification with the subject matter of the claims.  Rather, it is a matter of substance, whereby the intentions of the applicant or patentee are to be determined, at least insofar as they are expressed in the specification as a whole, in relation to each claim, or group of claims.  On the other hand, the decision may not go far enough, in that it is not clear that it necessarily applies to cases in which there are not two or more distinct groups of claims relating to different aspects of an invention.


Ronneby Road Pty Ltd (‘Ronneby’) had opposed the grant of a patent on an application owned by ESCO Corporation (‘ESCO’).  A delegate of the Commissioner of Patents, in a decision issued on 5 February 2015, found that the opposition failed on all asserted grounds: Ronneby Road Pty Ltd v ESCO Corporation [2015] APO 3.  There were two other opponents, however only one (not Ronneby) raised inutility as a ground of opposition, and none made substantive submissions on the point.

Ronneby appealed to the Federal Court, asserting grounds of lack of novelty and/or fair basis in relation to certain claims, and inutility.  The novelty case was partially successful, while the fair basis attack was wholly unsuccessful.  However, Ronneby was successful in its attack based on inutility: Ronneby Road Pty Ltd v ESCO Corporation [2016] FCA 588.

ESCO sought leave to appeal to the Full Court, which was granted, seeking to overturn the adverse conclusions of the Primary Judge on both novelty and utility.  Leave was granted, and the appeal allowed in full, i.e. all of ESCO’s claims have now been found to be novel and useful.  The novelty finding is largely specific to the facts of the case, and is based entirely upon well-established legal principles, which I do not intend to discuss here (although anybody requiring a primer on the principles of construction of patent specifications could do worse than paragraphs [144]-[147] of the decision).  The Full Court’s reasons in relation to utility are much more interesting.

Lack of Utility Before the Primary Judge

The ESCO patent application is directed to ‘wear members’ which can be attached to excavating equipment for the purposes of protection.  The concept is pretty straightforward, and such things are self-evidently ‘useful’ in the ordinary sense of the word.  As the patent specification explains:

Wear parts are commonly attached to excavating equipment, such as excavating buckets or cutterheads, to protect the equipment from wear and to enhance the digging operation. The wear parts may include excavating teeth, shrouds, etc. Such wear parts typically include a base, a wear member, and a lock to releasably hold the wear member to the base.

Paragraph 6 of the specification states that:

The present invention pertains to an improved wear assembly for securing wear members to excavating equipment for enhanced stability, strength, durability, penetration, safety, and ease of replacement.

There are, it will be noted, six advantages asserted here.

According to expert evidence provided to the court at first instance, none of the claims delivers on all six advantages, although every claim provides at least two of them.  However, the Primary Judge regarded the ‘paragraph 6 statement’ as a composite promise, and concluded that the failure of any claim to deliver all six advantages would render that claim invalid for lack of utility.  Accordingly, every claim was found to be invalid on this basis.

A Lack of Judicial Authority?

There is, as it turns out, not a great deal of judicial authority on the question of inutility by failure to satisfy ‘promises’, and even less so on the specific issue of (as the Primary Judge put it) ‘how a promise which was textually composite would feed into the court’s consideration of the utility of a claim which did not deliver on each and every one of the advantages contained in it’.  And, as stated by the Full Court, ‘there is no decisive authority in Australia put to us in which the two competing views have been expressly in controversy between parties leading to a deliberative consideration by the Court of the two positions’ (at [226], italics in original).

The English case most commonly cited as authority for the principle that an invention must satisfy all promises made in the specification is Re Alsop’s Patent (1907) 24 RPC 733, which was a decision of the English High Court of Justice – Chancery Division.  The patent in that case concerned a process for the treatment of flour ‘resulting in the bleaching of the flour and in increasing its proteids and diminishing its carbohydrates as suggested in the title and detailed and emphasised in the body of the Specification’ (quoted in ESCO Corporation at [202], emphasis in citation).  However, as the Full Court noted (at [203]), the judge in Alsop’s case had observed that these statements were ‘themselves the results of the process for which protection is claimed’, notwithstanding that the treatment of flour in the manner described did not, and could not, ‘increase its proteids or diminish its carbohydrates’.

The Full Court did not regard Re Alsop’s Patent as entirely relevant to the facts in ESCO Corporation, or to the position under the current Australian law.  Firstly, it regarded the case as one ‘concerned with a “composite promise” where one element of the promise is not attained rather than several or distributive promises where only one of those promises might find expression in a particular claim’ (at [227]).  Secondly, it considered that the judge in Alsop’s case ‘treated the failure to deliver upon one element of a composite promise as analogically in the same class of case as that case where a patent would be rendered invalid by the failure of a claim notwithstanding that other claims might be valid’ (at [228]).  While this was the common law position in England in 1907, the current Australian law requires each claim to be considered separately, and provides that ‘the invalidity of a patent in relation to a claim does not affect its validity in relation to any other claim’ (Patents Act, section 22).  As the Full Court subsequently noted (at [296]), in this context it makes little sense to treat the six advantages listed in ESCO’s ‘paragraph 6 statement’ as a single ‘composite promise’ in the sense of Alsop, since:

…the 22 claims address two different but ultimately related things, yet nevertheless distinct things: the features of the wear member and the features of a wear assembly. Is the Specification really to be understood as saying that the 12 claims for the “wear member” must produce or attain, for the invention to be useful, as claimed in any one claim, the composite promise of enhanced stability, strength, durability, penetration, safety, and ease of replacement? That language is not compatible with the notion of a composite promise for the invention described in the Specification so far as it relates to claims concerning the component described as the wear member.  (Emphasis in original.)

In addition to Re Alsop’s Patent, the Primary Judge in ESCO Corporation was ultimately swayed by the decision of the Supreme Court of New South Wales in Pracdes Pty Ltd v Stanilite Electronics Pty Ltd (1995) 35 IPR 259.  However, the Full Court observed (at [219]) that there was no controversy between the parties in Pracdes ‘on the question of whether the patent in question would be susceptible of revocation for inutility if the Court found, on the facts, that any one of a number of claims failed to attain all the promises claimed for them even though other claims might do so. Rather, that conclusion as a matter of law seemed to be common ground and the controversy turned upon whether a particular promise was attained or not.’  Accordingly, the Full Court noted (at [222]) that there is no ‘deliberative discussion’ in Pracdes of ‘whether fulfilling one or more of six promises, but not all promises, is sufficient or insufficient to establish utility, largely because that question was not in contest…’.

The Full Court therefore appears to have considered itself free to determine and apply the relevant law, independently of the authorities relied upon by the Primary Judge.  As stated at [233]:

The proper course then is to recognise … that utility “depends upon” whether, by following the teaching of, in this case, the Patent Application, the result claimed is produced. That involves identifying, as a matter of construction, the promise of the invention and asking whether the invention as claimed does what it is intended by the patentee to do.

Claims Do Not Lack Utility

The Full Court found, firstly, that ‘the language of para 6 consisting of a single sentence under the heading “Summary of the Invention” is not, properly construed, the language of “promises” (as Ronneby would have it) for the invention described in the Specification as a whole’.  Rather, ‘the relationship between “the invention” and those things recited in para 6 is one of identifying the topics or subject matter to which the invention relates (rather than “promises” for the invention), which … may or may not find expression in the claims “defining” the invention…’ (at [291]).

In any event, for a variety of reasons (set out at [294]-[296], including the one I have already cited above), the Full Court found that even if ‘the language of para 6, properly construed, contains a collection of “promises”, those promises … are to be read disjunctively as characteristics to which the invention relates’ (at [292]).  That is, the use of the word ‘and’ at the end of paragraph 6 notwithstanding, the only sensible way to read the statement is as if the word ‘or’ was used (or, presumably, ‘and/or’, which appears in paragraph 5).

So, if paragraph 6 does not set out the promise for the invention, the Full Court questioned (at [299]), ‘what promise is made for the invention by the Specification and where is the promise (or the promises) for the invention to be found?’  The answer (at [300]) is that:

The promise for the invention is to be found by, put simply, following the teaching of the Specification to see what result is claimed for the invention. Utility “depends” upon whether the result claimed is attained or produced. (Emphasis in original.)

The Full Court accepted Ronneby’s argument that the ‘orthodox’ (the Court’s term) approach would be, as in cases such as Alsop and Pracdes, to look first to the body of the specification to identify the promise(s) made for the invention, and then to the claims to see whether they attain the promise(s) so identified.  That is, in the received method, ‘there is a linear progression from the body of the Specification to the claims’ (at [302], italics in original).

However, the Full Court went on to explain (at [303]) that, in a case such as ESCO Corporation, where there are groups of claims directed to different aspects of the invention (here, a ‘wear assembly’ in one aspect, and an individual components, the ‘wear member’ in another), a ‘heterodox’ approach may be more appropriate:

it may well be necessary to turn to the body of the Specification, then turn to the claims, and then turn back to the Specification to identify what degree of symmetry exists between the subject matter of the claims (for example those relevant to the wear member only) and the paragraphs of the Specification which contain the promise relevant to those claims. The Court ought not to give a construction to the Specification read as a whole (including the claims) which brings about discontinuity or asymmetry.  (Emphasis in original.)

When the Full Court undertook this task, it found that the promise of the invention defined in claim 1 (and in the claims dependent upon it) was not to be found in paragraph 6 of the specification, but rather in paragraphs 15 and 16, which were directed specifically to the results to be obtained by the aspect of the invention corresponding with claim 1.  Since these results were, indeed, attained by the invention as defined in the relevant claims, they were therefore ‘useful’ in the required sense, and not invalid (at [304]-[305]).

Conclusion – Right Result, Wrong Reasons?

Although I would prefer to see an end – as in Canada – to Australia’s version of the ‘promise doctrine’, it seems to me that the correct result has (finally) been achieved in this case.  It is certainly encouraging that the Full Court has endorsed an approach that is sufficiently flexible to recognise that different aspects of an invention may deliver distinct benefits, and satisfy different ‘promises’.

It does concern me, however, that the Court appears to have gone to some effort to distinguish the ESCO Corporation case from earlier decisions on the basis that the ESCO patent application includes ‘two clusters of claims defining the invention’ (see, e.g., at [303]).  It seems to have considered this necessary to ensure that its reasoning is not inconsistent with the High Court’s 1998 judgment in Advanced Building System Pty Ltd v Ramset Fasteners (Aust) Pty Ltd [1998] HCA 19.  Personally, I cannot see why this should arise: inutility was not an issue before the High Court in Advanced Building, and the passing comment of the majority (that ‘utility depends upon whether, by following the teaching of the complete specification, the result claimed is produced’, at [24]) is both entirely agnostic as to how the relevant ‘result’ is to be identified, and plainly obiter dicta in any event.

It will be a shame if the flexible approach of the Full Court in ESCO Corporation, with its emphasis on identifying the substantive promise(s) made for an invention as actually claimed in each claim, becomes quarantined to those cases in which the claims actually comprise two or more ‘clusters’ relating to different aspects of an invention.  While ESCO may have claimed different aspects of its invention, in general an applicant is under no obligation to claim every aspect of every invention that may be disclosed in a patent specification.  The fact that there may be only a single ‘cluster’ of claims certainly does not preclude the possibility that there are other related aspects, and associated promises, also disclosed.  It may remain an open question whether the ESCO ‘heterodox’ approach can be applied in such cases.

In any event, so long as some form of ‘promise doctrine’ remains part of the Australian law, applicants and their patent attorneys would remain well-advised to continue the existing common practice of ensuring that patent specifications do not contain any statements that might be regarded as ‘promises’ that are not clearly satisfied by all claims.


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