Common Sense Often Makes Good Law” [US Supreme Court Justice William Orville Douglas]: Mu Mecanicos Unidos S.A.S v The Registrar of Patents

The Court of the Commissioner of Patents recently handed down a decision which brings long awaited clarity and relief to the patent profession and applicants in South Africa.  The issue before the court was whether an applicant for a patent may request an extension of time within which to publish acceptance of a complete specification after the expiry of the prescribed three-month period.

When a complete patent specification is accepted in terms of section 40 of the Patents Act, 57 of 1978, the applicant must arrange for the acceptance to be published in the Patent Journal within three months of the date on which acceptance was issued.

In this regard, section 42(3) of the Patents Act provides:

Unless the acceptance [of a complete specification] is so published in the journal within the prescribed period or within such further period as the registrar may, on application to him and on good cause shown and on payment of the prescribed fee, allow, the application shall lapse. [our emphasis]

Regulation 46 further provides:

When notice of acceptance of an application has been given by the registrar, the applicant shall advertise the acceptance in the journal within three months of such acceptance or within such further time as the registrar may allow on request on form P 4.

In this case, the Registrar of Patents issued a notice of acceptance and acceptance was inadvertently published in the monthly issue of the Patent Journal after the expiry of the prescribed three-month period.  The patentee made a request to the Registrar to extend the time period within which to publish acceptance until the date on which it was actually published.  The request was based, inter alia, on section 16(2) of the Patents Act, a general provision which empowers the Registrar of Patents to grant extensions of time made after the expiry of a time limit “save as is otherwise expressly provided”.

The Registrar refused the request on the basis that he was bound by the decision of University of Pretoria v Registrar of Patents 2011 BIP 411 (CP) “the University matter”.  That case was decided by the Court of the Commissioner of Patents more than 10 years ago, in which the Commissioner found that the words “the application shall lapse unless” in section 40 of the Patents Act, dealing with acceptance of a patent application, constitutes an express, specific prohibition on extending a time period after its expiry in terms of section 16(2).   The Commissioner in the University matter made similar statements concerning section 42(3). Therefore, in the case in issue, the Registrar was of the view that he was not empowered to grant the request insofar as it was made after the expiry of the prescribed period.

The patentee therefore appealed against the decision of the Registrar of Patents to the Court of the Commissioner of Patents.

The court noted the applicant’s argument that the University matter was distinguishable from the facts in issue because the University matter dealt with acceptance of a patent specification as opposed to publication of acceptance.  The court in the University matter was therefore not binding authority to determine whether the application to extend the time period for publication in terms of section 42(3) could be made after the prescribed period.

The court then reviewed previous decisions, including the case of Trustco Group International (Pty) Ltd v Vodacom (Pty) Ltd and Another BIP 27 (SCA) and found that the time period provided for in section 42(3) could be extended after its expiry and granted the extension of time.

The court also noted that it was evident that a restrictive interpretation would destroy the patentee’s right to a patent particularly in instances where there is a bona fide and reasonable explanation for the delay and that it would be more prejudicial when it was not within the patentee’s control.

Mu Mecanicos Unidos S.A.S was represented by Adams & Adams.

Click HERE to view the judgment.

Maxe (Pty) Ltd v Artav Stainless Steel CC: Design Registration Infringement – A Refresher of Old Lessons Learned

Maxe (Pty) Ltd instituted action proceedings against Artav Stainless Steel CC for infringement of several of its aesthetic design registrations covering sports bars and nudge bars for vehicles.  The trial took place in May 2020 and was the first trial concerning intellectual property to take place virtually in South Africa.

Sports bars and nudge bars are vehicle accessories that are fitted to a sports utility vehicle (SUV), a bakkie or a truck. A sports bar is fitted to the load bed of the vehicle directly behind the passenger cabinet and extends from the load bed across and behind the cabinet.  A nudge bar is attached to the front of the vehicle, generally on the underside of the vehicle and extends partially across and in front of the grill of the vehicle.

The design registrations comprised ‘omnibus’ type definitive statements where no particular feature is isolated in the statement. There were no explanatory statements in the design registrations.

It was common cause that Maxe’s designs were registered and valid and thus only infringement was in issue.  In its defence, Artav argued that both parties had been manufacturing, selling and distributing nudge bars and sport bars which had the same frame tubes or hoops but different crossbars, prior to Maxe applying for the registration of its designs, and that the shape and configuration of the hoops of Maxe’s nudge bar and sport bar designs were similar to Maxe’s prior designs which were commonly used and in the public domain to such an extent that the general shape of  Maxe’s design registrations were generic and commonplace. Thus, the defence was that (i) the measure of novelty of Maxe’s designs was small, (ii) the ambit of the monopoly of Maxe’s design registration was small, and (iii) the differences which exists between the parties’ respective nudge bar and sports bar designs were sufficiently substantial to avoid infringement.

Much was made in cross-examination of Maxe’s expert witness of the differences between individual components of Maxe’s designs and Artav’s designs.  The court found that whilst many differences were conceded by Maxe’s expert witness, his evidence was that one cannot look in isolation at each individual component – the design as a whole must be considered. If one does that, as a customer would, the differences between Maxe’s and Artav’s designs are negligible. The import of Maxe’s expert witness evidence was also that whilst there were similarities in the design of the hoops prior to and after the priority date of the designs, the changes to the shape, width, height and positioning of it as a whole, together with the rest of the design, distinguished it from the prior art.  In re-examination, it was pointed out that when viewed holistically, none of the prior art designs relied on by Artav in cross-examination resembled Maxe’s design.

The court also commented that some of the differences relied on by Artav in its arguments of non-infringement were only discernible by touch and, regarding one of the designs, the court stated they were virtually the same and differences required pointing out to be specifically noticeable.

There was a further dispute as to who the notional customer would be.  Maxe argued that a buyer of the sports or nudge bars would be an ordinary person with no specific knowledge of the particular item.  Artav, on the other hand, argued that the typical customer is likely to be a discerning customer and an enthusiast who is looking to acquire a “less than ordinary” vehicle and who is looking for something to compliment it.  The court found that the customer is the man-in-the-street who would purchase a specific vehicle because he either liked that brand or the look of the vehicle and who would purchase an accompanying accessory because it was available as part of the vehicle package or it was sold by the dealership. He would also not remember small nuances of whether the bars were round or oval, whether the joiners were individual or not, whether they were plastic or of another material, or whether they form part of the crossbar itself or not.

The court further noted that its impression of Artav’s designs at the inspection in loco, was that they were so similar to Maxe’s that without guidance from the parties’ representatives it was very difficult to see the differences between the two.

Finally Artav’s main thrust of evidence, and the main thrust of the argument, was that the court should only have regard to the crossbars between the hoops when assessing infringement. This is because, according to Artav, the hoops were somewhat standard and the joiners were primarily functional. However, the court found this argument to overlook a leading precedent case (Clipsal Australia (Pty) Ltd and Another v Trust Electrical Wholesalers and Another 2009 (3) SA 292 (SCA)) which specifically states that “the shape or configuration as a whole has to be considered”. The court found that this essentially meant that the design should not be viewed in its individual parts – it must be considered as a whole and it is in that light which the differences and nuances are to be considered.  On this basis, the court found all but one of Maxe’s design registrations to be infringed by Artav.

Adams & Adams Attorneys represented Maxe (Pty) Ltd.

Microsoft vs You First Mobile: Security for Costs Under the South African Patents Act and Compelling Discovery of Foreign Search Reports

You First Mobile (Pty) Ltd instituted an action against Microsoft (Pty) Ltd for infringement of its South African patent.  Microsoft in turn brought an interlocutory application against Your First Mobile to (1) compel You First Mobile to furnish it with the prescribed particulars of search reports issued in foreign jurisdictions in respect of foreign patent applications corresponding to the South African patent in terms of section 43(4) of the South African Patents Act 57 of 1978, and (2) to furnish security for costs in the event that an adverse cost order is made against You First Mobile in the action.

The Court of the Commissioner of Patents handed down judgment in the interlocutory application in favour of Microsoft on both counts.

Section 43(4)

South Africa has a non-examining patent system which means that provided formal requirements are complied with, a patent will be granted on a South African patent application regardless of the validity of the patent.  The grant of a South African patent is therefore no guarantee of its validity.

Section 43(4)(a) provides that after the expiry of five years following the date of application for a patent, any person may apply to the registrar for the patentee to supply the applicant with the prescribed particulars of any search report issued in another country in respect of an application for a patent relating to the same subject-matter which has been lodged in that country.  The registrar then passes on the application to the patentee.  Section 43(4)(c) provides that if the patentee fails to supply the applicant with the particulars, the applicant may apply to the Commission of Patents for an order requiring compliance.

Microsoft duly made application for the particulars in terms of the above provision.  You First Mobile declined to comply with the application citing that it was prohibited from doing so in terms of a settlement agreement.  After Microsoft launched the interlocutory application in issue to compel You First Mobile to provide the particulars, You First Mobile furnished the particulars of search reports in the USA only.  Microsoft maintained that a patent application had been filed in Australia and, accordingly, demanded that You First Mobile ought to state on oath that there were no further search reports in order to comply fully with the request.   You First Mobile refused to do so stating that it had fully complied.

Mokose J, sitting as the Commissioner of Patents, considered the rationale of Section 43(4) and stated that it is an important provision in the context of a non-examining patent system as it allows parties interested in the validity of the patent to assess the validity of a South African patent without necessarily incurring the costs of obtaining their own search reports.  Search reports issued in foreign jurisdictions, on the other hand, are issued by examiners who carry out substantive examination.  The provision therefore assists third parties in seeking the revocation of a patent if it is appropriate to do so.

In support of its stance, You First Mobile further argued that foreign search reports were in any event public documents.  Mokose J held that You First Mobile had not fully complied with Section 43(4) by failing to go on oath regarding the position in Australia and jurisdictions other than the USA and ordered compliance with Section 43(4).

Security for Costs

Microsoft applied for an order that You First Mobile furnish security for costs in terms of Section 17 of the Patents Act, alternatively, under the common law.  Section 17(2) confers a discretion on a court to require any party in proceedings before it to furnish security for any adverse costs that may be ordered.  Mokose J reaffirmed that ‘any party’ includes an incola plaintiff and that an order to furnish security for costs was a reasonable and justifiable limitation of the Constitutional right to have a dispute resolved in a fair and public hearing, provided it was reasonable and justifiable to do so in the circumstances.

Mokose J goes on to state that in exercising its discretion the court must consider various factors including You First Mobile’s inability to pay any adverse cost order against it. You First Mobile’s prospects of success and the extent to which the right of access to court would be curtailed by an order that security be furnished would also have to be considered by the court.

Mokose J confirmed that a litigant must lead evidence to show that it cannot put up security for costs.  It does not follow that because there is reason to believe that a litigant cannot meet an adverse cost order, there is reason to believe the litigant cannot put up security for costs.  The litigant may be receiving funding while the prospects of success are reasonable but not once the case has been lost.

Mokose J noted that the discretion conferred by the Patents Act is broader than that under the common law in that the applicant does not have to show that the plaintiff’s claim is vexatious, reckless, an abuse of process or even doubtful.  Ultimately the court needs to exercise its discretion based on its assessment of You First Mobile’s ability to meet an adverse cost order, the merits of the case and the extent to which an order, if granted, would bring the litigation to an end.

You First Mobile averred that when it instituted the action it had the financial backing of an individual which had since withdrawn the backing owing to the covid-19 pandemic.  It followed that You First Mobile was not in a position to put up security for costs.  You First Mobile did not disclose the identity of the individual, why it could not provide further backing nor did it set out a plan for securing alternative financial backing.  Furthermore, the inventor of the patent, litigated on the corresponding US patent against Apple and Sony which presumable was an expensive process.

Mokose J found that there was insufficient evidence to show that an order for security would bring the litigation to an end.

Microsoft, via its South African patent attorney, provided evidence as to why You First Mobile’s patent is invalid on the grounds of lack of novelty and material misrepresentation.  The evidence was not contested and You First Mobile merely argued that the patent attorney was not a qualified expert and thus the evidence as to lack of novelty should be disregarded.  Mokose J confirmed that the question of novelty was for the court to decide and is not for an expert to decide.  You First Mobile also did not contest evidence led by the patent attorney to show that the South African patent application contained a material misrepresentation, in that the inventor who signed the prescribed declaration knew that a patent granted on the application would be invalid due to lack of novelty.

Mokose J also held that to the extent that the provision for security for costs in the Patents Act is inconsistent with the common law or the Companies Act, it is of no consequence as the Patents Act is not subordinate to the latter. Mokose J therefore also ordered that You First Mobile furnish security for costs.

Microsoft was represented by Adams & Adams attorneys.

Top-notch talent in patent litigation

A patent provides the right to exclude others from making, using, exercising, disposing of (selling), offering to dispose of (offering for sale), or importing the patented invention for the term of the patent. When this right is infringed upon by others without permission, litigation may ensue.

Patent litigation can be costly, complicated, and time-consuming to reach an outcome. Patent holders are often unaware of these complexities, which can involve differing requirements and procedures in South Africa compared to jurisdictions out of its borders. Careful consideration and advice are needed before proceeding with a case.

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Functional Design Registrations | The Definitive Statement is King

A recent decision concerning a functional design registration registered in terms of the Designs Act 195 of 1993 was handed down by Acting Judge Millar in the High Court, Gauteng Division, Pretoria.  The ratio of the judgment, however, is also applicable to aesthetic design registrations.

Design registrations are the lesser-known alternative, or additional form of intellectual property protection to patents. In some cases, design protection is more effective than patent protection, in particular, where the novelty lies in the appearance of an article and where a proprietor seeks cheaper and quicker registration and enforcement.

An aesthetic design means any design applied to any article, whether for the pattern or the shape or the configuration or the ornamentation thereof, or for any two or more of those purposes, which appeal to and are judged solely by the eye, irrespective of the aesthetic quality thereof.

A functional design means any design applied to any article, whether for the pattern or the shape of the configuration thereof, or for any two or more of those purposes, any by whatever means it is applied, having features which are necessitated by the function which the article to which the design is applied, is to perform.

The Applicant in this case, Innovative Water Care Products (Pty) Ltd (“IWC”), is the holder a functional design registration for a design to be applied to a pool floater, which is used to dispense pool chemicals into a swimming pool.  IWC’s product is well known in the South African pool cleaning market under the brand “HTH”.   The Respondent, Fluidra Waterlinx (Pty) Ltd (“Fluidra”), launched its competing pool floater, marketed under the brand “Blu52” in 2019.

The unique feature of the HTH floater is the transparent nature of the tubular portion which extends from the floater head. This allows the pool chemicals contained inside the tubular portion to be visible from the outside of the floater to establish the extent of degradation of the contents of the floater.  IWC’s functional design registration is directed at this feature and it is also this feature that the Blu52 floater was alleged to have copied.

IWC brought an urgent design infringement application for interim, alternatively final relief against Fluidra’s Blu52 floater based on its functional design registration.  In the application it was not in dispute that IWC’s design registration had been correctly registered as a functional design and was otherwise valid and still had about two years of its term left before expiry.  The dispute concerned whether or not IWC’s HTH floater, and therefore in turn, the Blu52 floater, were protected or covered by the design registration.  In particular, Fluidra identified a number of differences between features depicted in the drawings lodged in support of the design registration that were not present in the HTH floater or the Blu52 floater.

An application for a design registration must be accompanied by a definitive statement which “shall be used to interpret the scope of the protection afforded by the design registration”.  Regard may also be had to the explanatory statement which accompanies it, as an aid to interpretation.

The definitive and explanatory statements of IWC’s design registration read as follows:

Definitive Statement:

The features of the design for which protection is claimed include the shape and/or configuration of a container for water treatment chemicals, substantially as illustrated in the accompanying representations, it being a definitive feature of the container that the tubular portion, indicated by reference letter “A” in the representations, is transparent or translucent, to enable the contents of the tubular portions, indicated by reference letter “B” in the representations, to be viewed by the eye from outside the container.  The contents B of the container are disclaimed.”

Explanatory Statement:

The design provides for a container for water treatment chemicals.  The tubular container portion houses the chemicals, particularly, but not exclusively, in table form, and depends from a flat.  The tubular portion may be of a clear material and transparent or it may be of translucent material that may be colour-tinted and adapted to enable the contents of the container to be viewed by the eye from outside the container”.

IWC argued that that features of transparency and translucency of the tubular portion are protected by the design and that the graphic representations of the container as a whole in the design registration were simply indicative of the shape of the container (floater) and that the definitive and explanatory statements made clear what specific functional design was registered.

Fluidra argued that the container design shown in the design registration must be considered an indivisible whole and that because the Blu52 floater did not correspond precisely with the container shown in the representations of the design registration, the design registration was therefore not infringed.

The court held that the “substance” of the design was the transparency or translucency of the tubular portion.  The court found that having regard to the definitive and explanatory statements, it was neither contemplated nor intended by IWC that the “general design, shape of form of the pool floater or the specific graphic rendering thereof was intended to be indivisible from the function of the transparent or translucent tubular portion.” This was clear from the use of the word “substantially” in the definitive statement.  The isolation of the particular feature as being ‘definitive’ in the definitive statement supported this.  Accordingly, the transparent or translucent feature taken alone was sufficient to infringe the design registration.

In light of its findings the court granted a final interdict against the Blue52 floater.

This case again demonstrates the importance of a well-drafted definitive statement and explanatory statement, particularly where the definitive statement does not take the form of the often used omnibus-type format.

Case citation: Innovative Water Care LLC and Another v Fluidra Waterlinx (Pty) Ltd (69172/2019) 2019 ZAGPPHC 530 (25 October 2019)

Click here to read the full Judgment.

By Sophia Smallbones | Associate

The Tiff over Teff | Traditional Knowledge

Recently, Mr Fitsum Arega, the Ethiopian Ambassador to the United States of America, tweeted news that the Court of The Hague had just handed down judgment in a matter in which two Dutch patents, concerning the processing of Teff, had been held to be invalid for lack of inventive step. His tweet continued “I hope we can learn from this that our national assets must be protected by Ethiopians & friends of #Ethiopia”.

Teff is a nutrient rich gluten-free grain that is and has for a long time been an integral part of Ethiopia’s heritage. It is used to make Injera, a pancake-like flatbread, which is a staple part of the Ethiopian diet.

The Dutch patents were in the name of a company owned by Dutch businessmen who, according to various media reports, had received traditional knowledge relating to Teff from Ethiopia in terms of an agreement in terms of which the traditional knowledge would be exploited for the mutual benefit of both parties. The businessmen, however, were not party to the agreement in their personal capacities but via a company which subsequently went insolvent resulting in their contractual obligations to Ethiopia with respect to the traditional knowledge ceasing. The businessmen then assigned the patents into the name of another entity and were able to exploit them free of any contractual obligations towards Ethiopia.

In South Africa, the Protection, Promotion, Development and Management of Indigenous Knowledge Systems Bill is currently before the National Assembly waiting for final approvals before being enacted into law. An aim of the Bill is to protect South African traditional knowledge to avoid situations like this one where traditional knowledge is exploited by third parties for no benefit to South Africa and without legal recourse.

For assistance and information regarding Traditional Knowledge policies in Africa, contact AfricaIP@Adams.Africa.