It is generally regarded that the provisions available in Australia for restoration of a lapsed patent application or patent are quite generous. For the most part, this is accurate but with some important caveats.
The application that is made is not to restore the abandoned application or granted patent per se but rather is a request for an extension of time (‘EOT’) to perform the relevant act that is required to be done within a certain time. Failure to do the relevant act must be due to an error or omission by a person concerned or his or her agent or attorney.
There must be a causal connection between the error or omission and the relevant act that is required to be done within the prescribed time period.
The phrase ‘error or omission’ has been interpreted broadly and includes actions such as accidental slips, inadvertencies and errors caused by faulty reflection, unexpected failure to exercise due diligence and/or a flaw in mental function in carrying out an intention, and a breakdown in procedure in effecting an intention.
It is important to note that the failure to perform the relevant act cannot itself be the ‘error or omission’, and, by extension, a deliberate policy or decision that leads to the failure to perform the relevant act does not qualify as an ‘error or omission’.
Identification of the error or omission and evidencing the steps that lead to the failure to perform the relevant act is key to an EOT application. Although this may seem like pedantry, failure to appreciate these fundamental principles may lead to a loss of commercially valuable patent rights as demonstrated in Nufarm Australia Limited v Advanta Seeds Pty Ltd  APO 5.
Australian Patent 2009304572 (the Patent) to Advanta Seeds (the Patentee) ceased due to a failure to pay the renewal fee due on 6 October 2017. At the time, the annuity service CPA Global was responsible for payment of the renewal fees. IP Australia notified the attorney of record, Spruson & Ferguson, on 20 April 2018 that the Patent had ceased due to non-payment of the renewal fee.
The Patentee applied for an EOT application of 18 months to pay the renewal fee; the EOT application was opposed by Nufarm Australia Limited (the Opponent). It is noteworthy that the Patent was licensed to a third party and therefore commercially valuable. There was no evidence to suggest that the failure to pay the renewal fees was intentional.
The Patentee’s EOT application was supported by two declarations by Barry Croker, the Managing Director of the Patentee. Mr Croker held the post of Global Supply Director prior to becoming to the Managing Director in 2018.
The employees responsible for management of the patent portfolio at the relevant time were no longer with the Patentee.
There was a convoluted set of circumstances surrounding the missed renewal deadline. In short, both Spruson & Ferguson and CPA Global had records of sending multiple reminder notices (by email and physical mail respectively) to the Patentee’s employees which, according to their records, were responsible for patent portfolio management. Unfortunately, these employees were no longer with the Patentee. According to Mr Croker, the Patentee had no record of receipt of reminder notices from Spruson & Ferguson or CPA Global. In July 2016, a series of structural changes were made within the broader Advanta corporate group which resulted in internal responsibility for payment of the Patent’s renewal fees moving to another entity, UPL Limited. This structural change necessitated the merging of the patent portfolio of the Patentee’s and UPL Limited, and implementation of a new patent portfolio management system where each of the over 2,300 cases were needed to be entered manually. The Patent was not entered into this system and thus the renewal deadline was not policed internally.
The Applicant identified the following three errors or omissions that, in their view, resulted in the failure to pay the renewal fee:
- not ensuring that emails sent to former Advanta employees were forwarded to current employees or to a general Advanta email address;
- not ensuring that physical letters sent to Advanta’s head office in Toowoomba, and addressed to a former member of staff, were forwarded to another member of staff; and
- failing to enter the details of the patent into the new patent portfolio management software.
In relation to items (i) and (ii), the Delegate considered that the circumstances provided by the Patentee did not identify a single error but a systemic error where staff had left and either nothing had been done to forward or direct enquires from those staff or no one knows what had been done. The Patentee claimed that having “no set policy in Advanta’s office in Australia for dealing with email [or postal mail] on the departure of an employee” should fall within the scope of an error or omission as broadly defined. The Delegate disagreed at [paragraph 20]:
To not have a policy of forwarding mail and email of former employees would inevitably lead to outcomes such as a failure to pay renewal fees on time. I cannot see how the current circumstances falls within the scope of the broadly defined error or omission given in Weir Pumps Ltd. For example, it cannot be a breakdown in a procedure when there was no procedure or system in place. This is not an error or an omission.
The Delegate conceded that failure to enter the patent into the patent portfolio management software qualifies as an error. However, the EOT application was refused on the basis that the Patentee did not provide “the full events” surrounding the error. As the Opponent pointed out, no dates were provided as to when the purchase of this software occurred or who did it. In the Delegate’s view, the Patentee would have knowledge of such events, and other events such as when the task of entering the patent portfolio into the software began. The Delegate’s position is that in the absence of such information, he could not determine if the error caused the failure to pay the renewal fees.
Although case law states that the EOT Applicant does not have a burden of proof to make their case, it is necessary that the EOT Applicant “set out the circumstances enough for the tribunal to be able to make a decision”. The Patentee failed to satisfy the Delegate in this instance, due at least in part to statements by the Patentee unsupported by evidence. This case serves as a timely reminder that the declaration filed in support of the EOT application must be a fulsome description of all the circumstances that lead to the failure to do the relevant act.