Late last month, Justice Burley handed down his decision in Doric Products Pty Ltd v Asia Pacific Trading (Aust) Pty Ltd [2017] FCA 849. The decision provides a useful illustration of how Australian Courts will approach construction, infringement and validity issues in innovation patent proceedings, and emphasises the difficulties respondents face when challenging the validity of innovation patents.

The patentee, Doric Products Limited (Doric), commenced proceedings against Asia Pacific Trading (Aust) Pty Ltd (APT), alleging that APT had infringed the claims of its innovation patents 2012100818 (818 Patent) and 2012100260 (260 Patent), by importing, selling and offering to sell a window winder called the "APT Product." APT cross-claimed, alleging that the asserted claims of both patents were invalid on grounds of lack of novelty and innovative step.

The innovation patents in question were both entitled 'a window winder' and related to a manually operated device for opening and closing windows. While such devices were certainly not new, the invention described in the patents included an adjustable stop means which allowed the user of the device to vary the degree to which the window could be opened without the need to access the internal mechanisms of the device.

In relation to infringement, Justice Burley found that the APT Product comprised each of the essential integers of the claims of the 260 Patent – namely, a 'body,' a winder mechanism mounted to the body, an 'elongated flexible element' (or chain) extending from within the body to attach to the window panel, a sprocket driven by the winder mechanism to move the chain, and an adjustable stop member which could be moved between predefined positions in the body to change the maximum length of the chain. His Honour rejected a submission by APT's expert witness that the winder mechanism of the APT product was mounted to the 'cover' of the device, as distinct from its 'body,' finding that 'body' in the context of the patent claims comprised the 'main or central part of the device.'

On the other hand, Justice Burley found that the APT Product did not infringe the claims of the 818 Patent because it did not comprise a stop means which was moveable 'by insertion and removal.' Burley found that 'insertion and removal' in the context of the 818 Patent meant insertion and removal from the body of the device. Importantly, the stop means in the APT Product comprised a screw which had been 'mushroomed' at its end, so that it was not fully removable from the body of the device.

As to validity, Justice Burley found that the invention described in the 260 Patent was novel and involved an innovative step over the prior art relied upon by APT. In determining innovative step, Burley focused on two prior patent specifications raised by APT, one in the name of Tacheny, entitled 'chain operator for a window' (Tacheny), the other, in the name of Lambertini, entitled 'Actuator with adjustable stroke' (Lambertini).

Based on the evidence of the parties, the key difference between the 260 Patent and Tacheny was that the invention disclosed in Tacheny comprised a stop means designed to adopt different positions in the chain of the device, whereas the stop member in the 260 Patent was designed to adopt different positions in the body of the device. In Justice Burley's opinion, this was sufficient for the 260 Patent to involve an 'innovative step' over Tacheny.

The invention described in Lambertini was driven by a motor. His Honour found that, on a proper construction of the language of the claims, the 260 Patent taught a device that was operated by a user with a winding action, typically by winding a rotary handle. Consequently, his Honour found that the 260 Patent also involved an innovative step over Lambertini.

The decision in Doric is a good illustration of how innovation patent proceedings often turn on narrow issues of construction and technical distinctions. The low threshold imposed by the test of 'innovative step' means that innovation patents are often difficult to challenge. It is important to note that an invention is taken to involve an innovative step unless the invention would only vary from the prior art in ways which make 'no substantial contribution to the working of the invention.'

In its final report on Intellectual Property Arrangements in December last year, the Productivity Commission noted that this 'low threshold' has proved more harmful then helpful for Australian businesses – especially the small and medium sized enterprises the innovation patent system was meant to assist – and recommended that innovation patents be abolished.

In the meantime, innovation patents continue to be a powerful enforcement tool for patentees, and a formidable challenge for downstream innovators.