All government-conferred intellectual property rights need to be renewed to be maintained. Each country has its own practice but broadly, renewal fees are due post registration for designs and trade marks, whilst for patents, renewal fees may become payable from the filing date or become payable after grant, either annually or at spaced period. By way of example, patent renewal fees are due annually in Australia and New Zealand from the four (4) year anniversary of the filing date whereas in the U.S., renewal fees are only due once the patent is granted at 3.5, 7.5, and 11.5 years after grant.
Regardless, it is crucial that the applicable renewal deadline is monitored in a diary system and the fee paid in good time. Even though payment of a renewal fee may seem banal, failure to do so can have serious consequences for your intellectual property right. The case of SARB Management Group Pty Ltd v Vehicle Monitoring Systems Pty Ltd [2025] APO 13 provides such a case study. The preface to this case is that there has been a significant amount of litigation over the patents at issue, not least in part because of VMS’s institution of infringement proceedings against Sarb, Sarb’s cross-claim for revocation of the patents on the grounds of invalidity, an appeal to the Full Federal Court of Australia, and various costs orders – both parties have invested a significant amount of time and money to enforce and protect their rights.
Two patents in the name of Vehicle Monitoring Systems Pty Ltd lapsed due to failure to pay renewal fees. The matters lapsed during dispute proceedings described above between Sarb and VMS.
When VMS were alerted to the lapse of these patents, an extension of time to pay the renewal fee was requested. Sarb filed an opposition to the extension of time. In Australia, the grant of an extension of time for failure to do an act is not as of right. It is a discretionary provision where the failure must be explained in a full and frank disclosure by the party that failed to do the act. The extension of time will be granted if the Commissioner of Patents is satisfied that the statutory requirements are made out.
Until 2021, the renewal fees for the patents were paid regularly by a third-party renewal company. From April 2022, VMS assumed responsibility for paying the renewal fees directly. The CEO of VMS stated that this decision was made for cost reasons.
In November 2023, IP Australia sent cease letters to VMS’s attorney of record setting out that the lapse occurred due to non-payment of the renewal fees by the due date of 9 May 2023. Due to a lapse in their internal procedure, their attorney of record failed to notify VMS that these patents ceased.
Shortly after VMS became aware of the patents lapse status in February 2024, the request for extension of time to pay the renewal fee was filed. Sarb was clearly monitoring the patents and opposed this extension of time. Sarb had a compelling motivation to oppose this request. In the ongoing litigation, Sarb challenged application of an injunction against them on the grounds that the patents were not in force. This issued was suspended while the extension of time was determined.
The opposition proceedings were not smooth for VMS. A substantial volume of submissions was filed by VMS, their attorney firm, and their lawyers. Sarb challenged many parts of their request, inclusive of alleged missing elements in the evidence, all no doubt which added to cost of proceedings. The evidence set out that VMS decided to pay the renewal directly in 2022 and proceeded to pay the annual renewal for 2022. Unfortunately, VMS expected that IP Australia would send them reminders for subsequent renewals. However, IP Australia only issues such reminders to the address for service recorded against the case, if such reminders are issued. In this case, the address for service was not changed to VMS. Moreover, VMS did not diarise the renewal deadline in their own docketing system. The extension of time was granted, as would be expected in light of the fact pattern, and the patents restored.
Lessons
It is understandable that an IP right owner would be enticed to pay their own renewal fees and would possibly not understand that a seemingly simple task must nevertheless be done right. Taking on the responsibility of inhouse renewal payment and monitoring should not be considered lightly.
Service fees levied by a patent or trade mark attorney firm or other renewal service provider not only covers the actual costs of paying the renewal but also costs related to having the case on their bespoke and specialised deadline monitoring system and sending out of deadline reminders. VMS probably found out the hard way that the cost of missing this renewal payment, the extension of time, barrister and solicitor representation in the opposition and evidence from their attorney firm, far outweighed having their address for service or renewal provider pay the renewal on what are clearly very important intellectual property rights.