The Challenges of Protecting and Commercialising IP in Casino Games

There are people who seem to believe that ‘inventing’ is some kind of get-rich-quick scheme – come up with an idea, slap a patent on it, and then wait for the untold millions to (magically) come rolling in.  A logical corollary to this belief is that if somebody acquires an idea from such a person, and subsequently incorporates the idea into a patent application, then they have clearly deprived the originator of their rightful fortune!  And, of course, the way to deal with such a situation is by spending, collectively, a few hundred thousand dollars disputing ownership of the patent application firstly in a state Supreme Court and then before a Full Bench of the Federal Court of Australia.

The only way this could all be a bigger waste of money and effort would be if the patent application in question was directed to some kind of unpatentable subject matter, such as a method of wagering on a card game, for example.  Sadly, this was precisely the situation in a case decided last October, Kafataris v Davis [2016] FCAFC 134.  There was, however, more to the dispute than inventorship and rights to a potentially worthless patent application.  Also at issue was whether or not the plaintiff had made a contribution to the wagering system described in the application that the defendants were obliged to keep confidential.  If so, then he might have been entitled to some form of compensation, regardless of the fate of the patent application.

Setting aside the ultimate futility of the legal action, there is a valuable lesson to be extracted from this particular dispute for those people who choose to direct their innovative efforts to the wagering and gaming industry – namely that novel developments in this field can be notoriously difficult to protect as a form of intellectual property.  Fortunately, the high level of regulation of gaming creates some barriers to entry which can be used, along with branding, as a means to secure an edge on potential competitors, even if patents are not available.

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Tags: Confidential information, Games, Patentable subject matter

Champagne Corks Popped as NZ Court Finds US Patent Infringed

Stewart v Franmara Inc [2012] NZHC 683 (26 March 2012)
Stewart v Franmara Inc no.2 [2012] NZHC 1771 (19 July 2012)

Breach of confidence – Patent infringement –Jurisdiction – whether New Zealand court has jurisdiction to decide infringement, in the US, of a US patent, where ownership and validity are not at issue

In what might be described as a ‘courageous’ ruling, a judge of the New Zealand High Court in Auckland has found, in Stewart v Franmara Inc no.2 [2012] NZHC 1771, that New Zealand courts have jurisdiction to decide on infringement of a US patent, committed in the US by a US-based company, at least in cases where there is no dispute over ownership or validity of the patent rights.

Having reached this conclusion, the judge (Justice Toogood) further found that, in this particular case, infringement of the US patent in question had occurred, and that the New Zealand-based patentee was entitled to a remedy in the form of damages.  However, the judge declined to apply a multiplication of damages for wilful infringement, which would be permitted under 35 USC § 284 if the case had been brought in a US federal court.

In reaching this decision, the New Zealand court has shown a remarkable willingness to reach outside the national jurisdiction, and to decide a question arising under a foreign patent law which is, frankly, very different from the law in New Zealand.  It was no doubt of assistance to the local plaintiff that the foreign defendant did not appear.  Had it done so, it might have pointed out some of the relevant differences, such as the US approach to claim construction, the operation of the US doctrine of equivalents, and the need to refer to the US patent prosecution history to determine questions of construction and possible estoppel.

This particular ruling could be an anomaly.  Nonetheless, it may provide some encouragement for other New Zealand holders of foreign patents to consider using their local courts to enforce international rights.  Having received a favourable judgement, however, the next challenge for the plaintiff will be to enforce the High Court’s damages order against the Californian infringer.

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Tags: Confidential information, Damages, Infringement, Jurisdiction, New Zealand, US

Appeals Tribunal Preserves Confidentiality as LEXAPRO Saga Extends

Aspen Pharma Pty Ltd and Commissioner of Patents [2012] AATA 281 (10 May 2012)

Practice and procedure – application for leave to rely on confidential documents – obligations of confidence – competing public interests in ensuring the proper administration of justice and in ensuring that contractual provisions as to confidentiality are duly enforced

In an interim decision relating to the ongoing efforts of Lundbeck A/S to obtain an extension of term of its patent no. 623,144 – which covers the S- or (+)-enantiomer of the antidepressant compound citalopram, marketed in Australia as LEXAPRO – the Administrative Appeals Tribunal (AAT) has ruled to preserve confidentiality in a prior agreement between Lundbeck  and Sandoz Pty Ltd by which earlier court proceedings seeking revocation of the patent were settled.

The issue before the Tribunal was this:

When information pertinent to a decision exists in a confidential document (such as a confidential settlement agreement), is it appropriate – and, if so, in what circumstances – to grant leave for the confidential document to be used as evidence in the proceedings, thereby effectively breaking the original confidence?

In this case the Tribunal found that breaking confidence was not justified, at least in-part because there is other evidence in the ongoing proceeding which will allow the same issues to be raised.

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Tags: AAT practice, Confidential information, Evidence

Don’t Let the Bed Bugs Bite (or ‘A Fool for a Client’)

Abrahams v Biggs [2011] FCA 1475 (23 December 2011)

Confidential Information – disclosure of information regarding potential improvements to invention – whether use of information by recipient is a breach of confidence – whether ‘information’ or merely ‘idea’ – whether identified with sufficient specificity – whether information had necessary quality of confidence – whether circumstances of imparting information imported obligation of confidence

If there were ever a case to prove the hoary old chestnut that the person who acts as their own lawyer has a fool for a client, then this is it.  Especially when they do so in a higher court, such as the Federal Court of Australia.

But we will return to the issue of self-representation towards the end of the article.  Our interest in the case of Abrahams v Biggs, decided by Justice Jessup just before the holidays, lies not so much in the conduct of the parties before the Federal Court, but rather in the aspect of the dispute relating to an alleged breach of confidence.  The case involves invention (and, peripherally, patent applications), and serves as a useful reminder that inventors need to be careful of what they disclose, to whom, and the circumstances in which they make disclosures, especially when potentially valuable ideas are involved.

And to add to the interest, the applicant in the proceedings, Tony Abrahams, was a winner in the episode of the ABC television program The New Inventors which aired on 20 May 2009.

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Tags: Australia, Confidential information, Litigation, Non-disclosure agreements