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May 25, 2007

Upside Down Down Under

In a unanimous decision Wednesday, recognizing the value of patent protection for incremental invention, the Australian High Court ruled in Lockwood v Doric that "a "scintilla of invention" remains sufficient in Australian law to support the validity of a patent." "'Obvious' means 'very plain'." Most notably, unlike the arrogantly parochial U.S. Supreme Court, relying upon its own cogitations and no other, the Australian High Court draws from understanding and precedent worldwide.

Lockwood owned Australian Letters Patent No. 702534, claiming a door lock having an additional release (besides a key) from the inside (locked in) using a combination of integers. Upon threat of assertion, Doric sought relief (like declaratory judgment in the U.S.), claiming invalidity, including obviousness.

[T]he main issue for this Court is whether the combination of integers in claim 13 involves an inventive step. This requires the consideration of the combination itself and any other evidence to determine whether the evidence, as a whole, supports the inventiveness of the combination.

The Australian appeals court (Full Court) had found claim 13 obvious because claim 1 was obvious, ignoring, the High Court pointed out, Section 22 of the Patents Act 1990, which provides: "The invalidity of a patent in relation to a claim does not affect its invalidity in relation to any other claim."

Australian law -

The applicable sub-sections of s 7 of the Act, as in force at the relevant time, provided:

"(2) For the purposes of this Act, an invention is to be taken to involve an inventive step when compared with the prior art base unless the invention would have been obvious to a person skilled in the relevant art in the light of the common general knowledge as it existed in the patent area before the priority date of the relevant claim, whether that knowledge is considered separately or together with either of the kinds of information mentioned in subsection (3), each of which must be considered separately.

(3) For the purposes of subsection (2), the kinds of information are:

(a) prior art information made publicly available in a single document or through doing a single act; and

(b) prior art information made publicly available in 2 or more related documents, or through doing 2 or more related acts, if the relationship between the documents or acts is such that a person skilled in the relevant art in the patent area would treat them as a single source of that information;

being information that the skilled person mentioned in subsection (2) could, before the priority date of the relevant claim, be reasonably expected to have ascertained, understood and regarded as relevant to work in the relevant art in the patent area."

Historical context -

Lack of novelty as a ground for invalidating a patent had its origins in the United Kingdom through the Statute of Monopolies enacted in 1623, which provided for the grant of Letters Patent for the "sole working or making of any manner of new manufactures" to the "true and first inventor". Within this context, novelty embraced not only the issue of anticipation, but also the issue of whether a thing produced required "some exertion of mind that could properly be called invention."

Obviousness, or lack of an inventive step, was not clearly recognised as a separate ground of invalidity until late in the 19th century when a contemporary writer stated that the ground of invalidity emerged "as a brake upon the too rapid progress of patents for analogous uses". This development continued early in the 20th century. It became commonplace to note in the cases that, in addition to novelty, it is necessary to ask separately whether an invention is "ingenious", or to recognise as Lockhart J said much more recently in R D Werner & Co Inc v Bailey Aluminium Products Pty Ltd ("R D Werner"):

"Invention means more than novelty. Novelty alone will not sustain a patent."

Briefly, the first Australian patent legislation, the Patents Act 1903 (Cth), imported into Australian law the principles in place in the United Kingdom.

The Patents and Designs Act 1932 (UK) introduced a consolidated list of grounds for the revocation of a patent. One of the grounds provided that a patent could be revoked if the invention was not new; but a further ground of revocation could be invoked if the invention "is obvious and does not involve any inventive step having regard to what was known or used prior to the date of the patent". That constituted a different formulation of the old ground of "want of subject matter" with the test becoming an overtly qualitatively test rather than a quantitative one.

Although the Knowles Committee was established in 1935 to consider changes to Australian patent law in the light of these developments in the United Kingdom, it was not until the recommendation of the Dean Committee in 1952 that the Patents Act 1952 (Cth) ("the 1952 Act") was passed. That legislation implemented similar changes in Australia, including a consolidated list of grounds for revocation. This legislation contained s 100(1)(e), which provided for revocation if a claim "was obvious and did not involve an inventive step, having regard to what was known or used in Australia on or before the priority date of that claim" (emphasis added).

This was the first legislative recognition in Australia that obviousness, or lack of inventive step, constituted a ground of revocation which was independent of lack of novelty, despite the fact that such a distinction had been made in legislation in the United Kingdom nearly 20 years earlier... In 1991 the legislature raised the threshold of inventiveness, compared with the 1952 Act, by requiring consideration not only of what was "known or used" but also of additional information which was publicly available.

A similar development in relation to obviousness took place in the United States. The patent regime there originated from the English system; however, since the passing of the first patent statute in 1790, a number of divergences have occurred. The most recent codification is the Patent Act 1952 (US). Although primarily restating the law as it stood up to that point in time, it also introduced the concept of "non-obviousness" as a legislative requirement for patentability in § 103. This took place in circumstances where obviousness had been recognised and applied in courts as early as 1850.

The emergence of the independent requirement for an inventive step, first in case law, then in legislative requirements for patentability as occurred in the United Kingdom, the United States and Australia, has always reflected the balance of policy considerations in patent law of encouraging and rewarding inventors without impeding advances and improvements by skilled, non-inventive persons.

What constitutes prior art has evolved from limited to "common general knowledge" to encompass everything in the public domain.

"Common general knowledge" was well understood as being "part of the mental equipment of those concerned in the art under consideration".

Previously, only common general knowledge was taken into account when assessing an inventive step. Now, additional information which was publicly available as at the priority date must also be taken into account.

Practically identical to U.S. CAFC rulings, granting broad scope as to what constitutes prior art, [Section] 2(2) of the Patents Act 1977 (UK) now provides that the "state of the art" for the purposes of determining obviousness includes everything in the public domain:

"all matter (whether a product, a process, information about either, or anything else) which has at any time before the priority date of the invention been made available to the public (whether in the United Kingdom or elsewhere) by written or oral description, by use or in any other way."

Patentability of ideas -

For the purposes of considering this Patent and its treatment in the Courts below, it is instructive to start with an old but frequently repeated description of the processes of invention by Fletcher Moulton:

"An invention may, and usually does, involve three processes. Firstly, the definition of the problem to be solved or the difficulties to be overcome; secondly, the choice of the general principle to be applied in solving this problem or overcoming these difficulties; and thirdly, the choice of the particular means used. Merit in any one of these stages, or in the whole combined, may support the invention".

Distinctions between the idea or concept or principle informing an invention and the means of carrying it out or embodying it in a manner of new manufacture have long been made despite certain expressions of caution from time to time. In Hickton's Patent Syndicate v Patents and Machine Improvements Company Ltd, Fletcher Moulton LJ stated that "invention may lie in the idea, and it may lie in the way in which it is carried out, and it may lie in the combination of the two".

Obviousness is "a question of fact, ... not a question of what is obvious to a court."

In Alphapharm, this Court reiterated that "obvious" means "very plain", as stated by the English Court of Appeal in General Tire & Rubber Co v Firestone Tyre and Rubber Co Ltd. The majority in Alphapharm also confirmed that the question of whether an invention is obvious is a question of fact, that is, it is what was once a "jury question". Broadly speaking, the question is not a question of what is obvious to a court. As well as being a question of fact, the question of determining whether a patent involves an inventive step is also "one of degree and often it is by no means easy", because ingenuity is relative, depending as it does on relevant states of common general knowledge. This difficulty is further complicated now by the need, in some circumstances, to consider s 7(3) information as well as common general knowledge.

Further, as recognised in Beecham Group Ltd's (Amoxycillin) Application, as a basic premise, obviousness and inventiveness are antitheses and the question is always "is the step taken over the prior art an 'obvious step' or 'an inventive step'"? An inventive step is often an issue "borne out by the evidence of the experts". There is no distinction between obviousness and a lack of inventive step. A "scintilla of invention" remains sufficient in Australian law to support the validity of a patent. In R D Werner Lockhart J stated that there must be "some difficulty overcome, some barrier crossed". This is consonant with older authorities in the United Kingdom which recognised that some inventiveness was required to distinguish patentable advances over the prior art from advances which "any fool" could devise. It also accords with the requirement in the United States that for an invention to be "non-obvious" it must be "beyond the skill of the calling".

Noting the perniciousness of "ex post facto analysis," aka, hindsight reasoning, the High Court calls for evidence that "the circumstances are that no skilled person in the art... had thought of... solving a known difficulty... as at the priority date." In contrast to European law, focused on a 'problem-solution' approach, the Australian High Court considers viewing obviousness in light of 'problem-solution' useful, but not dispositive.

This Court rejected confining the question of obviousness to a "problem and solution" approach, particularly with a combination patent. This should not be misconstrued. The "problem and solution" approach may overcome the difficulties of an ex post facto analysis of an invention, which may be unhelpful in resolving the question of obviousness. However, it is worth repeating that the "problem and solution" approach may be particularly unfair to an inventor of a combination, or to an inventor of a simple solution, especially as a small amount of ingenuity can sustain a patent in Australia. Ingenuity may lie in an idea for overcoming a practical difficulty in circumstances where a difficulty with a product... is common general knowledge. This is a narrow but critical point if, as here, the circumstances are that no skilled person in the art called to give evidence had thought of a general idea or general method of solving a known difficulty with respect to a known product, as at the priority date.

One skilled in the art -

Whether a patent is obvious under the Act is still to be determined by reference to the hypothetical non-inventive worker in the field (now a "person skilled in the relevant art" (ss 7(2) and 7(3)) equipped with common general knowledge.

The person skilled in the relevant art in this case is a lock designer. Under the provisions the question of whether an invention does not involve an inventive step on grounds of obviousness, is decided objectively by the application of a statutory test employing the standard of "a person skilled in the relevant art". "Prior art information" is also determined objectively by the application of a statutory test involving the same standard.

The value of secondary evidence -

Something further also needs to be said about secondary evidence. Secondary evidence, such as commercial success, satisfying a long-felt want or need, the failure of others to find a solution to the problem at hand and copying by others such as competitors, has a role to play in a case concerning an inventive step. In Molnlycke AB v Procter & Gamble Ltd (No 5) ("Procter & Gamble"), Nicholls VC warned that secondary evidence should not be permitted to "obscure the fact that it is no more than an aid in assessing the primary evidence". That observation can be compared with the treatment of secondary evidence in the United States of America. Under § 103 of the Patents Act 1952 (US) it is necessary to make a number of factual inquiries when making a determination of invalidity based on obviousness. The primary considerations include determining the scope and content of prior art, identifying the differences between the prior art and the advance over the prior art which is claimed and assessing the level of ordinary skill in the art. Secondary considerations of non-obviousness, if any, are also to be determined. In Graham v John Deere Company of Kansas City ("Graham") the Supreme Court of the United States identified the role of secondary evidence:

"Such secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc, might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented. As indicia of obviousness or nonobviousness, these inquiries may have relevancy."

Since Graham, the inquiry into secondary considerations of non-obviousness has been treated as being an important inquiry which must be taken into account because prior art cannot be evaluated in isolation[182].

Quite a difference from the SCOTUS KSR ruling, where obviousness was decreed a matter of law, not fact, hence giving the green light to district court summary judgments. To say that obviousness is a matter of law, not fact intensive, is a fantasy; though offering potential for quick resolution, which doubtlessly is what SCOTUS had in mind when it went against its own precedent.

Posted by Patent Hawk at May 25, 2007 12:32 AM | International


Sadly, yet another example of pure prejudice, a court dismissing the EPO Problem and Solution Approach (PSA) without first making any effort to understand it. This is because no court sits atop the EPO, so no court has any need to grapple with the logic of PSA, and no other court has to give deference to authority coming from the court that sits atop the EPO. I am totally mystified how EPO PSA is "unfair" to the inventor of a "simple" or "combination" invention. The Australian court doesn't tell us but just states it as a fact. BTW, obviousness is obviously a mixed question of law and fact. Particular acts of the PHOSITA would have been obvious, or not, on date X, as a fact. Whether those obvious acts are enough to deprive any given claim of validity is a question of law (but easily resolved in the EPO under PSA). As I keep on reiterating, day long oral proceedings at the EPO are 90% taken up with other matters. Obviousness gets done and dusted in 30 minutes or less, yet no regular EPO combatant's complaining, not the patent owners and not those who bring oppositions at the EPO.

Posted by: MaxDrei at May 25, 2007 1:12 PM