Australia: Say it isn't so: Incorporations by reference and priority claims

Multigate Medical Devices Pty Ltd v B Braun Melsungen AG [2016] FCAFC 21 (3 March 2016)

Executive Summary

• For priority claim purposes, the invention in a divisional application need only be disclosed, rather than be described, in the priority application or parent application(s).
• A reference to figures of an earlier filed application in a divisional application was sufficient to incorporate the description of those figures into the divisional application and thus provide support for the priority claim.
• Applicants should ensure that the disclosure in any divisional application includes the disclosure of any parent or ancestor applications by using an explicit incorporation by reference.

This is a decision of the Full Federal Court on appeal from a decision at first instance that Australian Patent Numbers 2012258327 and 201260577 (the Patents) in the name of B Braun Melsungen AG (Braun) were infringed by Multigate Medical Devices Pty Ltd (Multigate).

The Full Court decision deals with the construction of several terms of the claims in the Patents and the entitlement of the Patents to claim priority back to one of the two US priority applications, US Patent Application No. 09/097,170 (the US Priority Application). This article discusses the priority entitlement issue.

In Australia, to have a valid priority claim the claims of a patent application must be "fairly based" on the matter disclosed in the priority application. This requirement is often called "external fair basis".

In the present case, the Patents were two divisional applications in a line of divisional applications comprising parent, grandparent and great grandparent applications back to Application Number 199895323 (the Original Ancestor). The Original Ancestor was the national phase application from an international application claiming priority to the US Priority Application.

The Patents incorporated by reference their immediate parent patent application but not the Original Ancestor. Instead, the Patents only made two references to the Original Ancestor. The first reference was in terms of the Original Ancestor as disclosing a type of catheter having the problem to be solved. The second reference was to a discrete part of the Original Ancestor relating to a needle protecting means illustrated in Figures 10A, 10B and 11.

At first instance, the trial judge held that there was an incorporation of the Original Ancestor by reference in the Patents, even though there was not an express incorporation by reference. Nevertheless, the trial judge relied on expert evidence on how a skilled person would read the specifications to determine that references to the Original Ancestor were sufficient to provide incorporation by reference and thus provide external fair basis. Consequently, it was held that the Patents were entitled to the priority date of the Original Ancestor, and thus entitled to the priority of the US Priority Application.

On appeal, Multigate submitted that:

• the Original Ancestor was not incorporated by reference in the specifications of any of the Patents, the parent, grandparent and great grandparent applications;
• the trial judge should not have relied upon expert evidence to support the finding of an incorporation by reference to the Original Ancestor; and
• the claims of the Patent defined inventions that "distanced" themselves from the invention described in the Original Ancestor, the parent, grandparent and great grandparent applications and so was not "fairly based".

Consequently, Multigate argued that the Patents were only entitled to claim priority to their respective filing dates and not entitled to claim priority back to the US Priority Application via the Original Ancestor.

Multigate was successful on grounds (1) and (2). In a joint judgement, the Full Court agreed that the Original Ancestor had not been incorporated by reference into the Patents or of any of the parent, grandparent and great parent applications. The Full Court also stated that expert evidence should not be relied upon to determine whether there had been an incorporation by reference of the Original Ancestor. Instead, the analysis should be limited to the text of the patent specification.

However, Multigate was unsuccessful on ground (3).

The Full Court reviewed the relevant legislation and regulations, and noted that the effect of these provisions was that external fair basis only required the claims to be "fairly based on matter disclosed" in the parent. This was in contrast to the requirement for "internal" fair basis that the claims are fairly based on matter "described" in the specification. This distinction was significant as the requirement for disclosure instead of description meant that for priority date purposes a claim can be fairly based if some part of the overall disclosure discloses relevant matter. The Full Court emphasised that this distinction meant that there is greater flexibility in applying the test of external fair basis.

The Full Court also said that the test for external fair basis requires a focus on whether in the earlier specification there had been a real and reasonably clear disclosure of the invention that is currently claimed. The issue is not whether a subsequent claim had been previously made in the earlier specification that is now the subject of the divisional application.

In this case, the Full Court held that the second reference in the Patents to specific figures in the Original Ancestor was sufficient to incorporate the description of those figures by reference. On that basis, this incorporated description was sufficient to provide a real and reasonably clear disclosure of the claimed inventions in the Patents. For similar reasons, it was held that this also applied to the parent, grandparent and great grandparent applications.

Accordingly, the Full Court held that the Patents were entitled to the priority date of the Original Ancestor.

This case should be a reminder to Applicants that the disclosure in all parent and priority applications should be included in any subsequent divisional applications to ensure that there is no doubt as to the entitlement to claim priority. This can be easily done with an explicit incorporation by reference. Otherwise, there is a risk that a divisional application could be found to lack validity due to its priority date being limited to its filing date.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.