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Applying for a patent

Patentability
What are the criteria for patentability in your jurisdiction?

There are two types of patent in Australia: standard patents (with a term of 20 years) and innovation patents (with a term of eight years).

To meet the requirements for a standard patent, an invention must be a manner of manufacture (ie, belong to the useful arts, provide a material advantage and be of value in the field of economic endeavour), and be novel, inventive and useful. Standard patents are subject to substantive examination before grant.

To meet the requirements for an innovation patent, an invention must be novel and useful and involve an innovative step. The threshold required to demonstrate innovative step is somewhat less than that required for an inventive step. Innovation patents are not subject to substantive examination before grant, but must be examined (‘certified’) before enforcement.

What are the limits on patentability?

Human beings and the biological processes for their generation are not considered patentable inventions. Further, artistic creations, mathematical models, plans, schemes and other purely mental processes are excluded from patentability as they are not considered a manner of manufacture (ie, belonging to the useful arts, providing a material advantage and being of value in the field of economic endeavour).

To what extent can inventions covering software be patented?

The patentability of a software invention depends on its ability to meet the requirement of being a manner of manufacture (ie, belonging to the useful arts, providing a material advantage and being of value in the field of economic endeavour). Generally, this requires the software to present an artificial state of affairs in order to provide a physical effect.

To what extent can inventions covering business methods be patented?

Business methods may be patented, provided that the method directly involves a physical form or device to provide a useful product. 

To what extent can inventions relating to stem cells be patented?

No explicit provisions prohibit the patentability of stem cells and methods of using stem cells, provided that the invention does not result in a human being or a biological process for the generation of a human being. Totipotent stem cells are generally not patentable. Any invention relating to stem cells should be considered on a case-by-case basis.

Are there restrictions on any other kinds of invention?

No other restrictions on inventions exist.  

Grace period
Does your jurisdiction have a grace period? If so, how does it work?

Australia provides for a grace period of 12 months from the date of first public disclosure of an invention by or with the consent of the inventor. To utilise this grace period, a complete application (including a Patent Cooperation Treaty application designating Australia) must be filed with IP Australia by the 12-month deadline.

Oppositions
What types of patent opposition procedure are available in your jurisdiction?

Substantive opposition procedures can be commenced after acceptance of an application, but before the grant of the patent. Other actions can also be opposed by third parties, including the grant of a pharmaceutical term extension for a patent, the allowance of amendments, time extensions, corrections to the Register of Patents and licences to exploit an invention.  

Apart from oppositions, are there any other ways to challenge a patent outside the courts?

Before grant, third parties can provide submissions to IP Australia in relation to matters affecting validity.

After a patent application has been accepted, any third party may file a request for IP Australia to re-examine the granted patent.

However, notices of matters affecting validity and the re-examination process are generally considered less effective than opposition or revocation proceedings as they are conducted ex parte, and as such the third party has minimal involvement in proceedings. 

How can patent office decisions be appealed in your jurisdiction?

Patent Office decisions can be appealed to the Federal Court of Australia. In some cases, an appeal to the Administrative Appeals Tribunal may be more appropriate. 

Timescale and costs
How long should an applicant expect to wait before being granted a patent and what level of cost should it budget for?

The duration and costs for a patent to be granted can vary significantly, depending on the complexity of the prosecution and the number of claims pursued. However, as a general rule, applicants should expect a timeframe of at least 36 months from national phase entry to grant, and budget between US$3,000 and US$6,000.

Enforcement through the courts

Strategy
What are the most effective ways for a patent owner to enforce its rights in your jurisdiction?

The most effective method for a patent owner to enforce its rights is through litigation. Alternatively, mediation or arbitration proceedings can be considered as an option. 

What scope is there for forum selection?

There are no provisions for forum selection in Australia. All first-instance patent matters are heard by the Federal Court.

Pre-trial
What are the stages in the litigation process leading up to a full trial?

The two main stages leading up to the final hearing are the completion of pleadings and the completion of evidence. Depending on the case, the pre-hearing process may also involve a number of interlocutory steps, such as applications for discovery, subpoenas, notices to admit, security for costs and mediation.

Pleadings
The applicant first files an originating application, a statement of claim and a genuine steps statement. The defendant may then file a defence and the applicant may file a reply. If the defendant files a cross-claim seeking to revoke the patent(s) in suit, the applicant may file a defence to cross-claim; the defendant may then file a reply to cross-claim. Any cross-claim for revocation will be determined as part of the infringement proceeding first instituted by the applicant.

Evidence
Once pleadings are closed, a timetable will be put in place for completion of the evidence in support, evidence in answer and evidence in reply. If a cross-claim has been filed seeking revocation of the patent(s) in suit, a timetable will also be put in place for the evidence in support, evidence in answer and evidence in reply on the cross-claim to be filed by the relevant parties.

How easy is it for defendants to delay proceedings and how can plaintiffs prevent them from doing so?

Although both parties may make submissions to delay trial proceedings, it is difficult for a party to delay these proceedings without offering a good reason to do so, due to the active involvement of the Federal Court in managing the litigation processes.

As a general rule, where a delay would cause significant prejudice to either party, it will not be granted. However, the court may allow a delay in proceedings in exceptional circumstances. Any decision made with regard to a delay in proceedings may be appealed. 

How might a party challenge the validity of a patent through the courts in anticipation of a potential suit for infringement being issued against it?

In anticipation of an infringement suit, a party may attempt to invalidate a patent through revocation proceedings in the Federal Court. These proceedings may consider all grounds of invalidity and all forms of prior art, and accordingly have a wider scope than the limited grounds and prior art considered in re-examination. However, revocation proceedings are often more costly and require a longer timeframe for resolution. 

At trial
What level of expertise can a patent owner expect from the courts?

A patent owner can expect a high level of expertise from the Federal Court, particularly as most judges have experience as IP barristers. Where a judge lacks the relevant technical experience, he or she can engage independent experts. 

Are cases decided by one judge, a panel of judges or a jury?

First-instance cases are decided by a single judge. In appeal proceedings, a panel of three judges will usually hear the case; however, this panel may be increased up to seven judges for sensitive or complex cases.

If jury trials do exist, what is the process for deciding whether a case should be put to a jury?

Jury trials do not exist for IP cases in Australia.

What role can and do expert witnesses play in proceedings?

Usually, each party will select independent experts to provide written and/or oral evidence to the court. This evidence can include insight as to the common general knowledge in the art, as well as explanations of technical features. The evidence provided by each expert is available for cross-examination and experts commonly attend court proceedings.

Where experts offer conflicting views, the court may also engage its own independent expert. 

Does your jurisdiction apply a doctrine of equivalents and, if so, how?

The doctrine of equivalents does not apply in Australia.

Is it possible to obtain preliminary injunctions? If so, under what circumstances?

Preliminary injunctions may be granted where a judge is convinced that there is a sufficiently strong prima facie case. The decision to grant an injunction will take into account the balance of convenience between all parties. 

How are issues around infringement and validity treated in your jurisdiction?

Where both infringement and validity proceedings have been commenced in respect of the same patent, the court will normally hear the cases together as part of the same action. 

Will courts consider decisions in cases involving similar issues from other jurisdictions?

The court will consider decisions from foreign jurisdictions. However, these considerations are not binding or indicative of how the court will rule.

Damages and remedies
Can the successful party obtain costs from the losing party?

A successful party may obtain recovery of a significant portion of its legal costs from the losing party; however, the quantum of costs awarded is determined by the court on a case-by-case basis.

What are the typical remedies granted to a successful plaintiff?

Typical remedies include injunctions, damages or an account of profits and orders for destruction or delivery up of the infringing goods. 

How are damages awards calculated? Are punitive damages available?

The plaintiff may choose either damages (compensating losses resulting from the infringement) or an account of profits (recovering profits made by the infringing party resulting from the infringement). The relief granted aims to restore the parties to the position they would have been in had the infringing conduct not taken place.

Punitive damages are available, but are rarely awarded. Punitive damages have been awarded in certain circumstances for flagrant infringement and conduct. 

How common is it for courts to grant permanent injunctions to successful plaintiffs and under what circumstances will they do this?

The court has the power to grant permanent injunctions in favour of the successful applicant. An order permanently restraining the respondent from doing or engaging in the impugned act or acts will be made by the judge if the applicant has established infringement (and any revocation action is unsuccessful). Such orders will not be made until after the matter has proceeded to a final hearing or been determined by way of an application for summary judgment.

Timescale and costs
How long does it take to obtain a decision at first instance and is it possible to expedite this process?

Parties can generally expect to wait from about four months following the final hearing before the court will publish its reasons for judgment. Decisions on matters heard on an urgent basis (eg, in applications for urgent interlocutory relief) may be published earlier. However, in the absence of compelling reasons before the court, there is no formal process by which parties can expedite the delivery of judgment.

How much should a litigant plan to pay to take a case through to a first-instance decision?

The costs of litigation vary depending on the number of patents in suit and the complexity of the case. Other factors affecting costs include the selection of counsel (senior counsel, junior counsel or both) and expert witnesses. Litigants can expect costs to vary widely, from about US$80,000 to more than US$1 million.

Appeal
Under what circumstances will the losing party in a first-instance case be granted the right to appeal? How long does an appeal typically take?

Parties wishing to appeal a first-instance decision must file a notice of appeal stating which part of the judgment is being appealed and the questions of law relied on. The appellate jurisdiction of the court will be exercised by the full court. Appeals can take from six months to one year.

Parties seeking to appeal interlocutory decisions must first obtain  leave of the court before filing a notice of appeal. Prospective appellants must show that the interlocutory decision in question is attended with sufficient doubt to warrant the grant of leave to appeal and that substantial injustice would result from a refusal. It is not sufficient that the decision made by the judge is clearly wrong; the decision must also effect a substantial injustice. 

Options away from court
Are there other dispute resolution options open to parties that believe their patents to be infringed outside the courts?

Parties may enter into mediation as an alternative form of resolution, although any agreement arising from private mediation will not be court sanctioned. Any right or power to enforce such an agreement would arise out of the terms of resolution.