Oxworks Trading Pty Ltd v Gram Engineering Pty Ltd

• Jurisdiction: Australia Federal only
• Court: Full Federal Court (Australia)
• Judgment Date: 23 December 2019
• Neutral Citation: [2019] FCAFC 240
• Date: 23 December 2019

FEDERAL COURT OF AUSTRALIA

Oxworks Trading Pty Ltd v Gram Engineering Pty Ltd [2019] FCAFC 240

Appeal from:	Gram Engineering Pty Ltd v Oxworks Pty Ltd [2019] FCA 689
File number:	NSD 988 of 2019
Judges:	MCKERRACHER, BURLEY AND O’BRYAN JJ
Date of judgment:	23 December 2019
Catchwords:	PATENTS – construction – whether the primary judge failed to construe the claim in the context of the specification as a whole – meaning of “formed from sheet material” – infringement – meaning of “sheet” – construction and infringement grounds of appeal dismissed ; PATENTS – award of additional damages – exercise of discretion under s 122(1A) of the Patents Act 1990 (Cth) – threshold for “flagrant” infringement – existence of a reasonably arguable defence to infringement – requirement to consider all other relevant matters contemplated by s 122(1A) – appeal allowed in part
Legislation:	Patents Act 1990 (Cth) s 122(1A)
Cases cited:	D'Arcy v Myriad Genetics Inc (2015) 258 CLR 334 Davies v Lazer Safe [2019] FCAFC 65 Electric and Musical Industries Ltd v Lissen Ltd (1938) 56 RPC 23 Gram Engineering Pty Ltd v Oxworks Pty Ltd [2019] FCA 689 H. Lundbeck A/S v Sandoz Pty Ltd (2018) IPR 408 House v The King (1936) 55 CLR 499 Industrial Galvanizers Corporation Pty Ltd v Safe Direction Pty Ltd (2018) 135 IPR 220 Pacific Enterprises (Aust) Pty Ltd v Bernen Pty Ltd (2014) 321 ALR 715 Pfizer Overseas Pharmaceuticals v Eli Lilly and Company (2005) 225 ALR 416 Raben Footware v Polygram Records Inc (1997) 75 FCR 88 Synthetic Turf Development Pty Ltd v Sports Technology International Pty Ltd (2005) 67 IPR 475 Welcome Real-Time SA v Catuity Inc (2001) 113 FCR 110 Zetco Pty Ltd v Austworld Commodities Pty Ltd (No 2) [2011] FCA 848
Date of hearing:	19 November 2019
Registry:	New South Wales
Division:	General Division
National Practice Area:	Intellectual Property
Sub-area:	Patents and associated Statutes
Category:	Catchwords
Number of paragraphs:	82
Counsel for the Appellants:	Mr C Dimitriadis SC with Ms L Thomas
Solicitor for the Appellants:	Thomson Geer Lawyers
Counsel for the Respondent:	Mr A Franklin SC
Solicitor for the Respondent:	Bird & Bird

ORDERS

		NSD 988 of 2019
BETWEEN:	OXWORKS TRADING PTY LTD First Appellant ; OXWORKS PTY LTD ACN 096 695 644 Second Appellant
AND:	GRAM ENGINEERING PTY LTD ACN 002 193 311 Respondent

JUDGES:	MCKERRACHER, BURLEY AND O’BRYAN JJ
DATE OF ORDER:	23 December 2019

THE COURT ORDERS THAT:

1. Any party wishing to contend for different or other orders consequent upon these reasons to those set out in Order 2, file and serve by no later than 31 January 2020 a written submission of no more than 5 pages setting out the orders for which they contend and the basis for their contention, with any responsive submission thereto (of no more than 5 pages) to be filed and served within 7 days thereafter.

2. Failing receipt of any submission in accordance with Order 1:

   1. the appeal be allowed in part;

   2. Order 8 made by the primary judge on 5 June 2019 (costs) be set aside and in lieu thereof the appellant pay 85% of the respondents costs of and incidental to the trial of the separate questions (infringement, unjustified costs and additional damages);

   3. the appellant pay 85% of the costs of the appeal;

   4. otherwise, the appeal be dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

1. INTRODUCTION

1. In this appeal Oxworks Trading Pty Ltd contends that the primary judge erred in finding that its product called the ColourSmart Plinth (the Oxworks plinth) infringed claims 1, 2, 4, 6 – 13 and 15 – 19 of Australian Patent No. AU2004291566 (the patent), which is owned by the respondent, Gram Engineering Pty Ltd.

2. The primary judge identified the only issue as being whether the Oxworks plinth alone, and as used in ColourSmart Fences, is a plinth “formed from sheet material” as that phrase is used in the asserted claims; Gram Engineering Pty Ltd v Oxworks Pty Ltd [2019] FCA 689 at [8]. The parties agreed before the primary judge and on appeal that this issue may be determined having regard to claim 1 of the patent. The primary judge found that it was, that the Oxworks plinth infringed the asserted claims and that Oxworks is liable to pay additional damages under s 122(1A) of the Patents Act 1990 (Cth) in respect of the infringement.

3. Oxworks challenges each of these findings. In particular, Oxworks contends in ground 1 that the learned primary judge erred in construing claim 1 by failing to have proper regard to the language used in the claim and failing to construe the claim in the context of the specification as a whole. In ground 2 it contends that the primary judge erred in concluding that the Oxworks plinth infringed, even if one accepts the construction preferred by the primary judge. This ground focusses particularly on the meaning to be given to the word “sheet”. In ground 3 Oxworks contends that the primary judge erred in his exercise of discretion under s 122(1A) of the Patents Act by awarding additional damages in favour of Gram.

4. For the reasons set out below, we dismiss the appeal insofar as it concerns the primary judge’s findings of construction and infringement, but allow the appeal in part insofar as it concerns additional damages.

5. We address the specification of the patent in more detail in the context of our consideration of the arguments advanced by the parties. It is entitled “Fence Plinth”. Claim 1 reads:

A fence plinth formed from sheet material having spaced apart end margins and being profiled to incorporate stiffening formations that extend along the sheet between the end edge margins.

2. GROUND 1: ERROR IN CONSTRUING CLAIM 1

   1. The arguments advanced by Oxworks

6. In ground 1 of the appeal Oxworks contends that the primary judge erred in construing claim 1 as encompassing a plinth made from a material with corrugations or profiles that has never been a flat material, rather than being limited to a plinth formed from a starting point of flat sheet material that is profiled by being bent or folded so as to incorporate stiffening formations that extend along the sheet. It contends that the primary judge erred in failing to construe claim 1 in the context of the specification of the patent as a whole, in finding as a point of significance that claim 1 is a product claim, and by construing claim 1 by reference to the alleged infringing article, being the Oxworths plinth.

7. Oxworks, which was represented by Mr Christian Dimitriades SC who appeared with Ms Laura Thomas, submits that in claim 1 “formed” is the past participle of the verb “form”, meaning “to shape”, and “from” is a preposition indicating a starting point. Thus “formed from” means “shaped from a starting point of” sheet material. The ordinary meaning of “sheet” is a material that is broad and thin – that is, substantially planar or flat. Examples include a bed sheet, a sheet of paper or a sheet of glass. Thus,...