Australia may be considered to have lenient provisions for extensions of time with regard to deadlines in patent matters, particularly where human error unintentionally caused a deadline to be missed. In describing these provisions, Australia’s highest Court has used the phrases “broadly protective” and “remedial operation”. There are also different avenues for challenging or appealing extensions and decisions to refuse or allow them.
In this article, we review the Federal Court’s decision in Nufarm Australia Limited v Advanta Seeds Pty Ltd to allow an extension of time for payment of a patent renewal fee. After a lengthy battle through three decision making bodies, it would seem that the patentee could finally pay the late renewal fee and the patent should now be in force. But the story does not end there.
This case concerns a commercially significant patent owned by Advanta, the plant cell technology it protects being the subject of an important 13-year licensing agreement (with an entity related to the counterparty, no less).
The patent has been the cause of numerous contentious events, including two section 27 notices (in which another party can file documents concerning the validity – generally prior art relevant to novelty and inventive step – of a patent application, comparable to Third Party Observations in Europe) and two substantive oppositions to grant by two different opponents. Regardless, the patent was granted in 2016.
Patent annuities are payable in Australia in respect of both pending applications (“maintenance fees”) and granted patents (“renewal fees”) annually starting on the 4th anniversary of the filing date. Payment can be validly made up to 6 months from the due date thanks to a so-called grace period provision. The first few of these annuities were timely paid for the Advanta patent.
In 2016, the need to pay the 8th year fee was initially overlooked, but payment was eventually made within the grace period and the patent was renewed. This was the last time an annuity was paid on time and thereafter the patent lapsed when the 2017 annuity was not paid by the due date or within the grace period.
When knowledge of their lapsed patent came to light, Advanta applied to IP Australia for an extension of time of the 6 October 2017 deadline to pay the 9th year annuity.
Opposition and Appeal Channels
Nufarm, a commercial competitor of the patentee (and parent company of the licensee!), opposed the extension. The opposition ran its usual course within IP Australia (colloquially, “the Patent Office”: the government agency responsible for administering rights and legislation regarding IP) and the Commissioner refused the extension. The primary reason for this decision is that, while Advanta established that an error occurred (failure to enter the patent into their new docketing software), they did not establish a causal link between that error and the failure to pay the renewal fee. This aligns with the extensions of time section of Australian patent legislation, which provides that where because of an error or omission, a relevant act is not done in time, the Commissioner may grant an extension.
Somewhat unusually, Advanta applied for review to the Administrative Appeals Tribunal (AAT), the independent body responsible for formally reviewing the decisions of the Australian government (i.e. appeals of administrative governmental agency decisions), following IP Australia’s decision to refuse their extension of time for payment of the late patent renewal fee. More commonly, decisions of the Commissioner of Patents are appealed to the Federal Court of Australia, rather than the AAT. As it happens, this matter eventually ended up in the Federal Court of Australia after the AAT decision to allow the extension was appealed by Nufarm.
Before the AAT, Advanta changed their approach somewhat from that taken before the Commissioner, seemingly to avoid a similar finding of no causal link between their error and non-payment. The new approach centred around a number of staff changes at Advanta and failure to notify their annuity provider of new contact details (as well as not closing a departed staff member’s email account) causing annuity correspondence not to reach relevant staff. The AAT agreed that the multiple failings resulted in the error not to instruct their annuity provider to pay the fee on time and this error caused the failure to pay. Thus, the extension of time provisions were met and the TTA granted the extension.
This brings us to Nufarm’s appeal to the Federal Court in which Nufarm asked the court to consider inter alia whether the failure by Advanta to authorise their annuity provider to pay the renewal fee constitutes the relevant error or does this rather form part of the failure to act; several authorities agree the error and the act cannot be the same thing. The Federal Court found no errors in the AAT’s findings, instead noting several shortcomings in Nufarm’s appeal. Accordingly, the decision to allow the extension of time stands and the 2017 renewal was allowed to be paid.
The status of Advanta’s patent presently is “ceased”. While they were successful in their bid to be allowed to pay the 2017 renewal fee late, while the extension process was playing out, Advanta failed to pay the 2018 and 2019 annuities on time (it seems Advanta may have finally caught on and from 2020, the renewals have been timely paid as due). An extension for the 2019 annuity appears to have been granted without much of a hitch, but Nufarm opposed the extension for the 2018 annuity.
The 2018 extension opposition has proceeded through its evidentiary stages and is presently set for a hearing in August 2023. Watch this space!
Applications for extensions of time are not straightforward, particularly meeting the need to detail both the error and the failure to do the relevant act, as well as showing a causal link between the two. Extensions can also be lengthy and may be opposed, thereby further delaying a decision as to whether an extension will be granted.
Accordingly, care must be taken to properly docket and monitor all actions requiring attention in the intervening period between the missed deadline and being allowed to rectify it.
Our advice is to leave your important IP rights safely in the hands of an experienced and competent patent attorney to ensure it is properly maintained and, while hopefully not required, if an extension of time becomes necessary, engage your patent attorney as soon as the missed deadline comes to light.