It may be tempting to think that the commercial success of a product is relevant to the validity of patents relating to that product. A recent decision of the Full Federal Court is a reminder of the limits to which evidence of commercial success may be used to support the validity of a patent.
Courts have previously recognised that secondary evidence, such as commercial success and long-felt want for a solution, may be relevant in assessing whether or not a claimed invention involves an inventive step.1
The Full Federal Court in Garford Pty Ltd v DYWIDAG Systems International Pty Ltd2 has provided guidance as to how secondary evidence will be treated by courts for the purposes of inventive step. In particular, the Full Court emphasised that the secondary evidence must be connected to the claimed invention (rather than an end product which may or may not incorporate the claimed invention), and that evidence of commercial success or copying is unlikely to be persuasive unless there is evidence of long-felt want or previous attempts by others to overcome the problem solved by the invention.
The patentee, Garford Pty Ltd (Garford) held a patent for an apparatus for the manufacture of continuous bulbed cable. Continuous bulbed cable is formed from multi-strand rock bolts with spaced apart bulbs, and is used for the purpose of stabilising bore holes in mines and rock tunnels.
In 2013, DYWIDAG Systems International Pty Ltd and DSI Australia (Holdings) Pty Ltd (the DSI parties), commenced a proceeding against Garford for relief in respect of unjustified threats of patent infringement relating to certain apparatus used by the DSI parties. Garford filed a cross-claim against the DSI parties for infringement of its patent and the DSI parties responded by seeking to have Garford’s patent revoked as invalid.
At first instance, the primary judge found that the DSI parties’ apparatus infringed certain claims of Garford’s patent but found that those claims were invalid for lack of inventive step. The primary judge also found that some of those claims were invalid for lack of novelty and/or secret use, but rejected the DSI parties’ arguments on those grounds for other claims. Garford brought an appeal against the primary judge’s decision to the Full Federal Court.
JUDGMENT OF THE FULL FEDERAL COURT ON APPEAL
The Full Court rejected Garford’s challenges to the primary judge’s findings on inventive step. The Full Court also upheld the primary judge’s findings on infringement, but found that the primary judge erred in rejecting the DSI parties’ arguments that additional claims were invalid for lack of novelty and secret use.
Of particular interest is the Full Court’s consideration of Garford’s arguments that the primary judge failed to have regard to secondary indicia of inventiveness, including evidence of copying, commercial success and an 'unfelt want' for a solution.
THE ASSESSMENT OF INVENTIVE STEP
The invention disclosed by the patent provided for an apparatus for the manufacture of continuous bulbed cable. Garford supplied a continuous bulbed cable product which was a successful product at the priority date.
The relevant claims were for a combination. Importantly, the primary judge found that each of the integers in the combination was common general knowledge, as was the end product (continuous bulbed cable) that the apparatus was used to manufacture.
Where a patent provides for a combination of known integers, the inquiry of inventive step is not whether the function performed by each individual integer is obvious, but whether the whole of the combination of which they form a part is obvious.
The primary judge found that the claimed combination was no more than the sum of its individual functionally-described components, providing an apparatus that carried out a sequence of ordinary and readily-perceived processing steps performed by components which performed well-known and well-understood functions to manufacture a known product. The primary judge also did not consider that there was anything inventive in conceiving of the idea of an apparatus for use in the manufacture of that product. As such, the primary judge concluded that it was obvious to construct an apparatus within each of the relevant claims. On appeal, the Full Court upheld the primary judge’s reasoning and conclusion.
THE IMPORTANCE OF SECONDARY EVIDENCE
Garford sought to rely on secondary evidence in support of its arguments on inventive step, including evidence of commercial success and copying of Garford’s apparatus, and submissions that Garford’s apparatus satisfied an 'unfelt want'.
The High Court has previously recognised that it should be 'slow to ignore secondary evidence or to rely on its own assumed technical expertise to reach conclusions contrary to such evidence'.3 However, the Full Court emphasised that evidence of this nature will serve as secondary indicia of inventiveness only and does not replace the statutory test that requires the patent to involve an inventive step as assessed against the prior art and common general knowledge. Accordingly, on its own, such evidence will not determine whether or not the claimed invention involves an inventive step.
Examples of 'signposts' or 'secondary indicia' of inventiveness that have been previously accepted as relevant by courts include:
- evidence of long-felt need for a solution to the problem,
- evidence of commercial success of the invention,
- the failure of others to find a solution to the problem solved by the invention,
- the copying of the invention by competitors, and
- acceptance of the invention by others.
Both the primary judge and the Full Court did not find any of the secondary evidence relied on by Garford as persuasive in the circumstances of this case.
Evidence of commercial success
According to the Full Court, evidence of the invention’s commercial success is only relevant if there is evidence of previous attempts to overcome the problem solved by the patent. If the problem the patent seeks to solve has not been previously recognised, or other solutions have been more effective, evidence of the invention's commercial success will not be persuasive in determining inventive step. Commercial success is therefore linked with a 'long-felt want' for a solution, which is further discussed below.
In this case, the Full Court also highlighted the importance of distinguishing between the commercial success of Garford’s continuous bulbed cable (the end product) and the commercial success of the invention as claimed. This requires the patentee to show that such success was due to the success of the invention (as reflected in the claims) as opposed to other factors such as advertising and brand power.
On this point, the Full Court found that it could not be inferred, from the fact the Garford bulb was a successful product, that the apparatus used to manufacture it had inventive merit. The Full Court agreed with the primary judge’s observation that there could be many reasons for the increasing success of bulbed cable as a product but that this did not necessarily reflect the commercial success of the claimed apparatus for producing the bulbed cable. The primary judge also noted that there was no evidence that Garford was in the business of manufacturing and supplying apparatus to manufacture continuous bulbed cable. Therefore, there was no measure of commercial success of the invention as claimed beyond the recognition that it allowed for the improved manufacture of a successful product.
Evidence of copying
The same viewpoint was taken of submissions that the copying of an invention by a competitor is evidence of inventive step. If there is also evidence of long-felt want for a solution to the problem, particularly when this evidence is supported by evidence of attempts to solve the problem, evidence of copying may be regarded as relevant to the assessment of inventive step.
In this case, the Full Court agreed with the primary judge that while copying may be relevant to the issue of inventive step, it did not have any probative value in this case. This was not a case in which a trade rival has unsuccessfully sought to solve a problem for some time and then, upon publication of the patent or release of the patentee’s product, decided to use an infringing product. Rather, the DSI parties had merely decided to continue using a machine that had been previously licensed after the failure to negotiate a new licence. This was presumably on the basis that the DSI parties could seek to revoke the patent if Garford sued the DSI parties for patent infringement.
Evidence of long-felt want/unfelt want
Garford alleged that the primary judge erred in failing to have any, or sufficient, regard to evidence of 'unfelt want'.
However, the Full Court did not accept that there was any evidence to indicate that the claimed invention constituted a solution to a long-standing problem with producing cable bolts that others had been trying to solve. The Full Court was of the view that Garford’s reliance on the asserted unfelt want rose no higher than its reliance on commercial success. In the absence of evidence that the claimed invention was commercially successful, it was not open to infer that the invention claimed satisfied an unfelt want.
In this sense, the Full Court observed that unfelt want is closely tied to the commercial success that comes with creating and satisfying the demand for a product whose usefulness or desirability was not appreciated before its invention. Even so, evidence of long-felt need or unfelt want is not necessarily determinative because there are some new and successful products that are not the subject of any long-felt want that are still found to have inventive merit.
WHAT DOES IT MEAN FOR YOUR PATENTS?
When secondary evidence is to be used to support inventive step, this case highlights the importance of ensuring that such evidence is connected to the claimed invention (rather than an end product which may or may not incorporate the claimed invention). For example, where a patent provides for an apparatus or mechanism for the creation of a product, it is the apparatus or mechanism itself that is the subject of the enquiry, not the end product. Therefore, evidence as to the commercial success or copying of the end product will bear limited relevance or weight in such circumstances.
In addition, the case also emphasises the relationship between the different types of secondary indicia. In particular, evidence of commercial success or copying will generally need to be accompanied by evidence of long-felt want or failed attempts by others to find a solution to the problem in order to be persuasive.
This article was written by Steve Wong, Senior Associate and Alicia Simonds, Graduate, Herbert Smith Freehills, Melbourne.