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Federal Court of Australia - Full Court Decisions |
Last Updated: 19 December 2005
FEDERAL COURT OF AUSTRALIA
Fresenius Medical Care Australia Pty Limited v Gambro Pty Limited
CORRIGENDUM
FRESENIUS
MEDICAL CARE AUSTRALIA PTY LIMITED (ACN 067 557 877)
v GAMBRO PTY
LIMITED (ACN 001 288 491) AND GAMBRO LUNDIA AB
NSD893 OF
2004
NSD1371 OF 2004
WILCOX, BRANSON AND BENNETT
JJ
21 OCTOBER 2005 (CORRIGENDUM 19 DECEMBER
2005)
SYDNEY
|
IN THE FEDERAL COURT OF AUSTRALIA
|
|
|
NEW SOUTH WALES DISTRICT REGISTRY
|
NSD893 OF 2004
NSD1371 OF 2004 |
ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
|
BETWEEN:
|
FRESENIUS MEDICAL CARE AUSTRALIA PTY LIMITED
(ACN 067 557 877) APPELLANT |
|
AND:
|
GAMBRO PTY LIMITED (ACN 001 288 491)
FIRST RESPONDENT GAMBRO LUNDIA AB SECOND RESPONDENT |
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JUDGE:
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WILCOX, BRANSON AND BENNETT JJ
|
|
DATE OF ORDER:
|
21 OCTOBER 2005 (CORRIGENDUM 19 DECEMBER 2005)
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WHERE MADE:
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SYDNEY
|
CORRIGENDUM
1 [55], 12th bullet point, the third sentence should read;
"Its use does not mean that infringement is avoided by the inclusion in a system of additional integers which are not part of the essence of the invention, even if present in other claims [132-133]."
2 [62], line 4, replace "That is included in claim 4." with; "That is included in claims 1, 2, 3 and 4."
3 [78], last paragraph of quoted text, replace "maintained is said third fluid conducting means" with; "maintained in said third fluid conducting means".
4 [82], second last sentence, should read;
"Looking at the claim "purposively" his Honour found at [159] that the ‘precise location of the break in the skin of the vessel through which the fluid passes into the intermediate ring and continues along the third fluid conducting means is functionally immaterial’."
5 [132], last sentence, replace "the first fluid conducting means" with "the second fluid conducting means".
6 [171], second sentence, replace "concentrate" with; "concentration."
7 [175], first sentence, replace "obviousness idea" with; "obviousness of the idea".
8 [200], inserted by Corrigendum dated 5 December 2005, second sentence, replace "bicarbonate bottles" with "liquid bicarbonate bottles."
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I certify that this is a true copy of the Corrigendum to the Reasons for
Judgment herein of the Honourable Justices Wilcox, Branson
and Bennett.
|
Associate:
Dated: 19 December 2005
FEDERAL COURT OF AUSTRALIA
Fresenius Medical Care Australia Pty Limited v Gambro Pty Limited
CORRIGENDUM
FRESENIUS
MEDICAL CARE AUSTRALIA PTY LIMITED (ACN 067 557 877)
v GAMBRO PTY
LIMITED (ACN 001 288 491) AND GAMBRO LUNDIA AB
NSD893 OF
2004
NSD1371 OF 2004
WILCOX, BRANSON AND BENNETT
JJ
21 OCTOBER 2005 (CORRIGENDUM 5 DECEMBER
2005)
SYDNEY
|
IN THE FEDERAL COURT OF AUSTRALIA
|
|
|
NEW SOUTH WALES DISTRICT REGISTRY
|
NSD893 OF 2004
NSD1371 OF 2004 |
ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
|
BETWEEN:
|
FRESENIUS MEDICAL CARE AUSTRALIA PTY LIMITED
(ACN 067 557 877) APPELLANT |
|
AND:
|
GAMBRO PTY LIMITED (ACN 001 288 491)
FIRST RESPONDENT GAMBRO LUNDIA AB SECOND RESPONDENT |
|
JUDGE:
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WILCOX, BRANSON AND BENNETT JJ
|
|
DATE OF ORDER:
|
21 OCTOBER 2005 (CORRIGENDUM 5 DECEMBER 2005)
|
|
WHERE MADE:
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SYDNEY
|
CORRIGENDUM
1 At the end of [102], add the following:
It was not argued that the invention involved a new application of principle in the sense stated in Shave v HV McKay Massey Harris Pty Ltd [1935] HCA 39; (1935) 52 CLR 701 at 709 (approved in Lockwood Security Products Pty Limited v Doric Products Pty Limited [2004] HCA 58; (2004) 217 CLR 274 (at [59]). The biBag is more than an ‘obvious mechanical substitute’ or a ‘disguise or cover’ for the invention the subject of claim 4 (Shave at 7-10). Claim 4 has, by its wording, left the biBag out of the claim (Olin at 530).
2 Delete [181] and insert the following:
THE SECOND AND THIRD DECISIONS
The second decision
181 After the primary judge delivered reasons in the first decision, a dispute arose between the parties as to the appropriate orders to give effect to that decision. This was because of a contention by Fresenius that the Fresenius machines can be employed without any infringement. Gambro sought orders to the effect that Fresenius is obliged to modify its machines in such a manner as to prevent them ever being used with the biBag.
182 The primary judge heard argument about this matter. On 31 May 2004, he delivered a supplementary judgment in which he recorded, at [10], that it was not put by counsel for Fresenius that the fitting on the Fresenius machine ‘is to be, or is able to be, employed for any purpose other than the acceptance of the affixation of a ‘biBag Article’ which, when used as a system in dialysis and cognate procedures, I have found to be an infringement’.
183 In his supplementary judgment, the primary judge recalled that Gambro had filed a further amended statement of claim during the course of the original hearing, which included a claim directed to s 117 of the Act. The original statement of claim had also raised s 117. That pleading had been the subject of the original defence, in which Fresenius admitted that it had sold, hired or otherwise disposed of dialysis machines, the biBag and modification kits to enable the machines to operate with the biBag. A defence to the further amended statement of claim included similar admissions.
184 In response to a notice to admit facts, Fresenius admitted that the Fresenius machines ‘are capable of only one reasonable use having regard to their nature and design, namely in conjunction with a source of water and a biBag Article to perform Treatment Procedures’.
185 In argument before the primary judge, Fresenius contended that the admissions were limited to the supply of the machines together with the biBag but did not extend to admissions that the supply of the machines with the fitting, but without the biBag, was an infringement. Fresenius submitted to the primary judge that there was no debate at the trial on this issue because there was no relevant allegation as to whether the machines with the biBag option, but without the biBag, were capable of more than one reasonable use, having regard to their nature and design. The primary judge at [31] rejected these submissions and held that the allegation of only one reasonable use had been pleaded and admitted. Further, his Honour noted that, in the written opening and in closing submissions, Mr Catterns QC, counsel for Gambro had stated that there was no dispute under s 117 and invited Fresenius to respond. Fresenius did not demur.
186 At the stage of determining the appropriate orders, Fresenius raised the question of the scope and construction of s 117 and whether the relevant issues remained open. The primary judge responded at [38]:
‘That issue has not been dealt with. It has not been dealt with because it was not pleaded or otherwise raised to introduce it into the controversy otherwise, relevantly, framed by the originating process, the pleadings, the admissions, the openings, the evidence and the addresses.’
187 Fresenius then indicated that it sought to withdraw admissions. His Honour directed that the application proceed by notice of motion. That gave rise to the third decision.
The third decision
188 The third decision was the subject of further supplementary reasons for judgment delivered on 11 August 2004. At paragraph 9 of those reasons, his Honour observed that the notice to admit facts was filed after taking account of the concerns of Fresenius, ‘a sophisticated commercial entity’. The evidence also established that Fresenius’ solicitor correctly understood the effect of the admissions. It was common ground that the machines can be used in two ways, with a biBag and with separate containers of liquid concentrate.
189 The primary judge accepted that Fresenius’ legal representatives may have formed a view as to the proper scope of s 117 and the effect of the admissions. However, that did not explain why nothing was said in response to Mr Catterns’ invitation in his opening (as in [185] above). His Honour noted that Mr Catterns proceeded on the basis that all relevant matters had been admitted for the purposes of allegations under s 117. Mr Catterns had submitted that any attempt to resile from those admissions would result in prejudice to Gambro and the need for a new factual controversy to be resolved, necessitating a re-opening of the case. His Honour accepted that to be the case and declined to permit a re-opening of the litigation. He was of the view that there would be prejudice to Gambro and that it would not be in the interests of justice, saying at [21]:
‘Parties in litigation are entitled to the benefit of the opportunity of informed and reasonably contemporaneous assessment of relevant evidence and issues so that, with the benefit of contemporaneity, choices can rationally be made in the conduct of such an expensive and difficult endeavour as litigation.’
190 On 12 May 2004, the primary judge had:
(a) declared that the appellant had infringed the Patent by selling, hiring and otherwise disposing of Fresenius Systems (‘Systems Declaration’); and
(b) made orders restraining the appellant from selling, hiring or otherwise disposing of the "biBag" (‘biBag Orders’).
191 On 30 August 2004, after dealing with the issues mentioned above, his Honour:
(a) declared that the appellant had infringed the Patent by selling, hiring and otherwise disposing of the dialysis machines that in conjunction with a "biBag" make up the Fresenius Systems (‘dialysis machines’);
(b) made orders requiring the appellant to modify the dialysis machines by removing four components that together enable the dialysis machines to operate in conjunction with the "biBag" as a Fresenius System; and
(c) made orders restraining the appellant from selling, hiring or otherwise disposing of the dialysis machines, unless modified.
Fresenius’ submissions
192 Fresenius’ submissions are to the effect that the Fresenius machines and systems do not infringe any of the claims of the patent in the absence of the biBag. As the machines were in fact capable of substantial non-infringing use without the biBag, there was no justification for the orders made on 30 August 2004.
193 As a matter of law, it is submitted, lack of evidence cannot be remedied by resort to s 117 and s 117 can have no application.
194 The primary judge rejected Fresenius’ contention that, properly construed, its admission was not that the machine without the biBag was capable of only one reasonable use. However, in argument before us, Mr Archibald QC conceded that the evidence of more than one reasonable use of the machines was not drawn to the primary judge’s attention until the issue of appropriate orders was raised after delivery of the first decision. Fresenius seeks to challenge his Honour’s conclusion as to the effect of its admissions and conduct of the litigation on its right to raise issues under s 117.
195 Fresenius submits that, even if the primary judge’s construction of the admissions is accepted, they are framed in the present tense and cannot apply to the future state of affairs. For the purposes of this submission, Fresenius accepts that it would be precluded from supplying the biBag.
196 Accepting for this purpose that the admissions were made and not withdrawn, Fresenius makes submissions on the effect of s 117, as a matter of law. Fresenius argues that the admissions extended only to the facts and cannot affect the legal position. Fresenius submits that s 117 ‘has no role’ in the context of combination product claims.
Consideration
197 As noted by the primary judge in the second decision, the Fresenius machines are capable of use with containers of liquid bicarbonate. It was not suggested that such a system would infringe the claims of the patent. The admission upon which Gambro relies is that the machines were capable of only one reasonable use: the use held to infringe the patent. For the reasons that he gave, as to which no error has been established, his Honour declined Fresenius’ application to withdraw that admission. The effect of the admission and the conduct of the case was that the case was fought on the basis that, if the Fresenius system were held to infringe, all of the elements of s 117 would be made out. His Honour accepted that this led Gambro not to plead or to present evidence to support an alternative case of authorisation under s 13 of the Act.
198 The basis of the primary judge’s decision was that there was no s 117 issue to be determined – all relevant admissions had been made. That is, the effect of Fresenius’ admissions and conduct led Gambro to conclude, properly, that there was no suggestion that s 117 would not apply. Whether the issue that Fresenius sought to raise after delivery of the first decision, and now seeks to reagitate, was factual or legal, Gambro’s contention was that, had it known that there was such an issue, it would have run a case on authorisation. His Honour accepted that contention. It follows that, even if the matters now sought to be raised are questions of law, the fact remains that, had Gambro been aware that Fresenius intended to raise an issue about the application of s 117, it would have run a different case. The primary judge thought that was a conclusive consideration. We see no error in his approach.
199 There was evidence before the primary judge, on consideration of the appropriate orders, that Fresenius intended to supply users with containers for liquid bicarbonate or an alternative article. This may explain one of the orders made by his Honour:
‘The Court grants [Fresenius] liberty to apply during the term of the patent to vary [restraining orders and orders to modify the machines] if it wishes to assert that any biBag System Component has a reasonable use as part of a system the exploitation of which would not infringe the patent.’
The Fresenius machines were, relevantly, included within the definition of "biBag System Component". If there is non-infringing use, Fresenius can make an application for orders enabling it to supply the machine.
200 The orders made by the primary judge allowed the supply of machines that had been modified so as permanently to remove the biBag connection. Fresenius has not been restrained from supplying machines adapted for use with bicarbonate bottles.
201 Fresenius submits that the evidence does not establish that it is reasonably certain that future infringing use will occur. The orders may affect a new non-infringing use. However, his Honour has provided a mechanism to cope with a future non-infringing use. In the context of drafting orders of some complexity to uphold and give effect to the finding of infringement, taking account of existing use of the machines, the evidence as to future use and the possibility of a different future use, we see no error in the orders made by the primary judge.
3 Paragraphs 182 and 183 of the Reasons for Judgment should now be numbered 202 and 203 respectively.
|
I certify that this is a true copy of the Corrigendum to the Reasons for
Judgment herein of the Honourable Justices Wilcox, Branson
and Bennett.
|
Associate:
Dated: 5 December 2005
FEDERAL COURT OF AUSTRALIA
Fresenius Medical Care Australia Pty Limited v Gambro Pty Limited
INTELLECTUAL PROPERTY – PATENTS – patent for a
system for the preparation of fluid intended for medical procedures such as
haemodialysis – purposive
construction – essence of the invention
and construction of the claims – characterisation of essential and
inessential
integers of the claims – functional equivalence –
principles of infringement – presence of additional integers
in alleged
infringing system – infringement where additional integers are inessential
or do not make a new working of the combination
and all essential integers of
claimed combination present – novelty – not sufficient for
infringement or anticipation
that essence of invention taken – lack of
inventive step and obviousness – inventive step not necessarily
coextensive
with the invention as claimed – assessment of competing expert
evidence on obviousness
Patents Act 1952 (Cth)
s100
Patents Act 1990 (Cth) ss 40(2), 40(3),
18(1)
Aktiebolaget Hassle v Alphapharm Pty Ltd [2002] HCA 59; (2002) 212 CLR
411
Atlantis Corporation Pty Ltd v Schindler (1997) 39 IPR
29
Azuko Pty Ltd v Old Digger Pty Ltd [2001] FCA 1079; (2001) 52 IPR 75
Bartlem
Pty Ltd v Cox Industries (Australia) Pty Ltd [2002] FCAFC 224; (2002) 55 IPR
449
Bristol-Myers Squibb Company v FH Faulding & Co Ltd [2000] FCA 316; (2000) 46
IPR 553
Canadian General Electric Co Limited v Fada Radio Limited
[1930] 47 RPC 69
Catnic Components Limited v Hill & Smith
Limited [1982] RPC 183
Clark v Adie (1875) LR 10 Ch App
667
Fellows v Thomas William Lench Ltd (1917) 34 RPC
454
Flexible Steel Lacing Company v Beltreco Ltd [2000] FCA 890; (2000) 49 IPR
331
Grove Hill Pty Ltd v Great Western Corporation Pty Ltd [2002] FCAFC 183; (2002) 55
IPR 257
Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty
Ltd [2001] HCA 8; (2001) 207 CLR 1
Minnesota Mining & Manufacturing Co v
Beiersdorf (Aust) Ltd [1980] HCA 9; (1980) 144 CLR 253
Meyers Taylor Pty Ltd v
Vicarr Industries Pty Ltd [1977] HCA 19; (1977) 137 CLR 228
Nicaro Holdings Pty Ltd v
Martin Engineering Co (1990) 91 ALR 513
Olin Corporation v Super
Cartridge Co Pty Ltd [1977] HCA 23; (1977) 180 CLR 236
Populin v HB Nominees Pty
Ltd (1982) 41 ALR 471
Radiation Limited v Galliers and Klaerr
Proprietary Limited [1938] HCA 17; (1938) 60 CLR 36
Rodi & Wienenbirger AG v
Henry Showell Ltd [1969] RPC 367
Sachtler GMBH & Co KG v RE Miller
Pty Ltd [2005] FCA 788
Walker v Alemite Corporation [1933] HCA 39; (1933) 49 CLR
643
Welch Perrin & Co Pty Ltd v Worrel [1960] HCA 91; (1961) 106 CLR
588
Wellcome Foundation v VR Laboratories (Aust) Proprietary Limited [1981] HCA 12;
(1980) 148 CLR 262
Blanco White Patents for Inventions
(4th
Ed)
FRESENIUS
MEDICAL CARE AUSTRALIA PTY LIMITED (ACN 067 557 877)
v GAMBRO PTY
LIMITED (ACN 001 288 491) AND GAMBRO LUNDIA AB
NSD893 OF
2004
NSD1371 OF 2004
WILCOX, BRANSON AND BENNETT
JJ
21 OCTOBER 2005
SYDNEY
ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
|
BETWEEN:
|
FRESENIUS MEDICAL CARE AUSTRALIA PTY LIMITED
(ACN 067 557 877) APPELLANT |
|
AND:
|
GAMBRO PTY LIMITED (ACN 001 288 491)
FIRST RESPONDENT GAMBRO LUNDIA AB SECOND RESPONDENT |
|
DATE OF ORDER:
|
|
|
WHERE MADE:
|
THE COURT ORDERS THAT:
1. The proceedings be stood over to 8 November 2005 at 9.30am for the purpose of making of orders giving effect to these reasons, including orders as to costs.
2. The parties provide to the Associate of Bennett J, by 8 November 2005, an agreed minute of the orders to be made (including the orders to be made as to costs) and if agreement has not by then been reached, the minutes of orders for which they will respectively contend and brief outlines of submissions in support of the orders.
Note: Settlement and
entry of orders is dealt with in Order 36 of the Federal Court Rules.
ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA
|
AND:
|
REASONS FOR JUDGMENT
1 The first respondent is the exclusive licensee of Australian letters patent 595423 held by its Swedish parent, the second respondent (collectively ‘Gambro’). The patent bears the title; ‘A system for preparing a fluid intended for a medical procedure by mixing at least one concentrate in powder form with water and a cartridge intended to be used in said system,’ and has a priority date of 6 February 1987. One medical procedure, for which the system is used, is the preparation of fluid for haemodialysis.
2 Gambro designs, manufactures and sells medical equipment including machines that are used for haemodialysis. The appellant (‘Fresenius’), a competitor to Gambro, designs, manufactures and sells machines that are used for haemodialysis.
3 Relevantly to this appeal, Gambro alleges that the promotion and sale by Fresenius of machines and modification kits for machines known as "the Fresenius 4008" and the "Fresenius Online Plus System with biBag Option" infringe the claims of the patent. Fresenius alleges that certain claims of the patent are invalid for want of novelty and for lack of inventive step.
4 The claims of the patent are not directed to systems for the preparation of all fluids intended for a medical procedure, but are confined to systems (claims 1 – 79 and 88) or cartridges arranged for use in such systems (claims 80 – 87) ‘for preparing a dialysis or replacement fluid or a component fluid thereof’. The narrower form of the claims in comparison with the title reflects amendments made during the course of these proceedings.
5 The systems claimed enable the production of fluid for use in haemodialysis. The patent is directed to an improvement in the design and operation of well known proportioning systems by the dissolution of powder in water to form a concentrate solution that is then mixed into a flow of water by types of well known proportioning machines.
6 The primary judge found that claims 2, 4, 5, 11, 24, 25, 28, 35, 80, 81 and 88 of the patent were infringed by the Fresenius system and by the vessel used in the system, the biBag.
7 The first decision of the primary judge the subject of this appeal, concerns the findings of infringement and the finding that the claims of the patent are not invalid. The second and third decisions concern the orders made after the first decision. Leave to appeal from each of these decisions has been granted. We shall deal first with the first decision.
8 The gravamen of Fresenius’ submissions is that the primary judge construed the claims without taking into account their wording and impermissibly added to the claims a gloss taken from teachings or disclosures of the specification. Fresenius complains that, in construing claim 2, his Honour impermissibly construed it with an eye to the alleged infringing acts.
9 There is no dispute that each claim is to an apparatus for preparing a dialysis or replacement fluid or a component fluid thereof. There are four independent system claims: claim 1, claim 2, claim 3 and claim 4. There are no method claims. Each of claims 1 to 4 commences with the words ‘a system for preparing’ a dialysis or replacement fluid or a component fluid thereof. Claim 1 includes, as essential integers, a measuring means and a flow regulating means. Those integers are not included in claims 2 and 4. Claim 4 includes integers specifically relating to the vessel. There are a large number of dependent claims. In addition, claim 88 is dependent on claims 28 to 30, which claim the system of claim 1, 2 or 4 where the vessel comprises a self-contained cartridge containing a quantity of powder concentrate suitable for one treatment procedure. There are also claims to a cartridge for use in a system in accordance with any of the independent and dependent system claims (other than claim 88). Claim 80 is the independent cartridge claim and claims 81 to 87 are dependent cartridge claims.
10 In this appeal, infringement is alleged of the independent claims 2 and 4 (and dependent claims). The primary judge’s finding of infringement of each of those independent claims result in infringement of the claims dependent on them. Separate considerations arise for the alleged infringement of claims 28 (and its dependent claim), 80 and 81 and also claim 88.
BACKGROUND
11 It is convenient to set out the background to the patent and the art with which it is concerned, which are not matters in dispute and are drawn from the reasons of the primary judge and from the outline of Fresenius’ submissions.
12 Prior to the mid 1970s, the means of mixing bicarbonate solution for use in dialysis machines involved mixing a pre-measured quantity of dry salts in a large tank prior to treatment and immersing the artificial kidney in the tank.
13 From the early or mid 1970s a concentrated acetate fluid (in lieu of bicarbonate) was mixed with water by proportioning machines "on-line" (or contemporaneously) and was then immediately used in the dialysis machine for the provision of treatment. Acetate was preferred to bicarbonate because it was more stable in solution over time and could be prepared off site and supplied in five litre containers to the hospital, rather than being prepared by nurses operating the dialysis machines prior to use.
14 Using this method, dialysis fluid consisted of a combination of purified water and a single acetate. Dialysis fluid was "proportioned" in appropriate quantities of acetate and water by connecting a five litre container of concentrate to the machine via a tube. The water was sourced initially from a tap supply via a particle filter and then later from a reverse osmosis water treatment unit.
15 By the early 1980s improvements in dialysis machines meant that acetate was more quickly taken up by the blood. This caused adverse side-effects for some patients. For clinical reasons, by the 1980s dialysis fluid returned to a mixture of "A" concentrate (electrolytes and acid dissolved in water) and "B" concentrate (sodium bicarbonate buffer dissolved in water, sometimes with sodium chloride).
16 The method of mixing the A and B concentrates consisted of:
(a) as far as the A concentrate was concerned, opening a five litre container of A solution, taking off the lid, inserting into the solution a wand, which reached into the bottom of the container, and allowing the proportioning machine to draw the contents out during the treatment;
(b) as far as the B concentrate was concerned:
(i) taking a bottle containing a pre-weighed amount of sodium bicarbonate powder (either mixed with sodium chloride or not);
(ii) filling a ten litre container (or sometimes five litre container) to a pre-determined point with reverse osmosis water;
(iii) tipping the powder into the container;
(iv) shaking the container until the solute visibly dissolved; and
(v) inserting a second wand into the B concentrate container as for the A concentrate.
17 In the mid 1980’s the B concentrate began to be sold commercially in pre-prepared ten litre containers. The A and B concentrates would be connected to the proportioning machines by wands in the manner described in the previous paragraph.
18 The focus of the claimed invention was an improvement in the production of the concentrate solution in combination with the known integers of proportioning systems.
19 The field of the alleged invention was found by the primary judge to be the design or improvement of dialysis machines or systems for which the system and articles as claimed are said to be improvements. The skilled addressee is a person(s) designing and improving dialysis machines.
THE PATENT
20 It is important to bear in mind what the invention, as disclosed in the specification and as claimed, is about and what it is not about. This is made clear in the patent.
The System
21 In the field of the invention:
‘The present invention relates to a system for preparing a fluid intended for a medical procedure and, more particularly, to a system for preparing such a fluid by mixing of at least one concentrate in powder form with water.’
22 The system of the invention as described in the specification can also be used in medical procedures other than dialysis.
23 After setting out problems with prior art types of concentrate solutions that are prepared prior to utilisation, the specification moves to the summary of the invention. The specification recites, broadly (with some differences to the claims, representing subsequent amendments), the consistory clauses. The primary judge observed at [54] that the claims, against which infringement is ascertained, are narrower and more specific than some parts of the body of the specification.
24 The specification states that the invention provides a system for preparing a fluid intended for a medical procedure by mixing of at least one concentrate in powder form with water. It continues (omitting the numbers that refer to components in the figures):
‘The system in accordance with the present invention comprises a reservoir for a source of water, and at least one vessel for containing a concentrate in powder form, and a fluid conducting circuit for withdrawing a small quantity of water from the reservoir and passing same through the vessel containing the concentrate in powder form in order to dissolve the concentrate before it is mixed with the rest of the water withdrawn from the reservoir through a main or primary fluid conducting means downstream of the liquid-containing reservoir.’
25 The description of the preferred embodiments includes further discussion of the disadvantages of the prior art, in particular the problem with the risk of precipitation of the sodium bicarbonate solution used in dialysis when the dialysis fluid with bicarbonate is prepared at a central processing plant or in large quantities at a treatment facility. In contrast, ‘the system in accordance with the present invention’ minimises such problems by preparing the fluid ‘by mixing at least one concentrate in powder form with water substantially at the time of treatment’.
26 The specification distinguishes, for the purpose of the invention, between the preparation of the concentrate before use and the mixing of the concentrate with water at the time of treatment.
27 Also described is a system in which a solution is prepared from one concentrate in powder form and one concentrate in liquid form. In accordance with a further aspect of the invention is a source of second concentrate fluid.
28 Another aspect of the invention is a measuring means for monitoring the composition of the prepared solution and a flow regulating means which is responsive to the measuring means for controlling the flow of concentrate fluid from the vessel.
The Vessel
29 The fluid circuit is said to include a column or vessel, which contains a concentrate in powder form. It is then said that ‘in operation’ water is introduced into the top of the column or vessel ‘to be conducted downwardly toward the bottom thereof’. As the water is conducted downwardly, a substantially saturated solution of the powder concentrate in water is obtained, to produce a concentrated fluid which is then conducted from the column.
30 Water could also be conducted through the powder concentrate column or vessel from the bottom toward the top but in the embodiments of the invention the water is fed through the column or vessel from the top to the bottom.
31 Further, ‘in accordance with the present invention’ the powder concentrate column may be in the form of a cartridge suitable for one treatment procedure, with penetrable membranes at its (the cartridge’s) upper inlet and its lower outlet.
32 In accordance with a still further aspect of the invention, the column or vessel ‘includes an inlet at the top thereof and an outlet of the bottom thereof’. The described arrangement is one where water is introduced into the top of the vessel to produce a concentrate fluid containing dissolved powder concentrate ‘so that the concentrate fluid is withdrawn from the bottom of the vessel and conducted to the primary fluid conducting means to be mixed with water being conducted therethrough’. Water is conducted through the powder concentrate vessel ‘from the top thereof to the bottom thereof to thereby maintain and provide a relatively constant concentration level of dissolved powder concentrate’.
The essence of the invention and the construction of the claims
33 As stated in the specification, the scope of the invention is indicated by the claims rather than by the description.
34 The construction of the claims is a matter for the Court. No witness gave evidence that the words of the claims were relevantly to be given a particular technical meaning.
35 The primary judge gave extensive reasons. Specific reference will be made to his Honour’s reasons as the various submissions are considered. According to the primary judge at [53], the advantage of the invention was that it overcame difficulties with the efficient and convenient preparation and use of bicarbonate buffer and, in particular, the disadvantages of on-site contemporaneous production of bicarbonate buffer solution.
36 The primary judge characterised the "essence of the invention" at [125] as ‘the use of dry powder in a vessel and its dissolution by the introduction of water into the vessel to produce a saturated (and so constant) concentrate fluid that was then withdrawn from the vessel and then dealt with in the customary way by the relevant machines’.
37 A key plank of Fresenius’ grounds of appeal, which relates to claim construction, infringement, novelty and inventive step is the further finding by the primary judge at [206] that ‘continuous on-line production of concentrate and its mixing with water contemporaneously, or on-line’ was the "essence" of the invention. His Honour concluded at [76] that what is taught by the patent is, irrespective of some language that was argued to suggest otherwise, contemporaneous on-line production. Fresenius contends that his Honour’s finding of the "essence" of the invention ‘controlled and dictated his conclusions’ in relation to those matters. Fresenius submits that the claims do not contain the integer of on-line continuous production or the creation "on-line" of a saturated concentrate solution to be then diluted "on-line" in the manner of the pre-prepared liquid solution of the prior art. Fresenius says that his Honour fell into error by including this conception, "on-line" or "continuous production" of dialysis fluid in conjunction with the operation of a dialysis machine, an unclaimed integer, as an essential integer of the system claims. Fresenius complains that the primary judge applied some ‘global notion of essence’ to the claims without identifying the precise content of that essence or applying it consistently.
38 Fresenius criticises the statement of the primary judge at [114] where his Honour said:
‘The interpretation of the specification and claims and the question of the resulting infringement or not is to be undertaken, as a matter of substance, having regard to the essence of the invention: Commonwealth Industrial Gases Ltd v MWA Holdings Pty Ltd [1970] HCA 38; (1970) 180 CLR 160, 168; the 3M case at 286; Radiation Ltd v Galliers and Klaerr Pty Ltd at 51; Populin v HB Nominees at 41-2; and Nicaro at 528-29.’
39 Standing alone as the entirety of the considerations to be applied in the construction of the claims, that would be an error of principle. His Honour also talked of ‘[t]he essence of the invention in the claims’ and said at [126] that it was that essence that was to be claimed and if not claimed, it was disclaimed. What needs to be determined is the subject matter of the claims. The construction of the claims takes place in the context of the specification as a whole. Reference may also be made to the body of the specification in order to understand the context in which words have been used (Flexible Steel Lacing Company v Beltreco Ltd [2000] FCA 890; (2000) 49 IPR 331 at [77]).
40 Fresenius does not dispute that the focus of the claimed invention was an improvement in the production of the concentrate solution in combination with the known integers of proportioning systems. Similarly, the finding by the primary judge that the field of the invention was the design or improvement of dialysis machines or systems for which the system and article as claimed are said to be improvements is not disputed.
41 His Honour construed as the essential integers of the claims those necessary for the "essence of the invention" as he described it. Other integers that appeared in the claims were characterised either as inessential or, perhaps, as essential only insofar as they denoted a matter such as placement. Their presence itself was said to be inessential. His Honour also referred to such integers as being present to narrow the scope of the monopoly such that, for example, prior art was avoided. It is not clear to us from his Honour’s reasons whether this meant that he considered them as essential or inessential for infringement and novelty purposes.
42 The primary judge at [131] seemed to characterise inessential integers on the basis that they are ‘part of the well known art concerned with the field beyond the essence of the invention, that is the mixture of concentrate by proportioning machines with fluid which the skilled addressee would know to be either necessary (a measuring device for the fail safe mechanism) or optional (a particular type of measuring device, a particular placement of a measuring device, or a particular flow regulation device, being one based on some measurement device’s reading’.
43 It will be apparent as discussed later in these reasons, that his Honour’s emphasis on the reference in the authorities to the ‘substance’ or ‘essence’ of the invention in the context of infringement and of anticipation is a necessary part of the analysis but not sufficient. Infringement and anticipation are assessed on the basis of the presence or absence of the essential integers of the claims.
44 Gambro submits that the ‘modern approach to construction’ is to read a document in its context and that this means that the claims are to be read in the context of the specification, not merely when ambiguity exists in the claim. This is correct. That does not mean, however, as made clear in Minnesota Mining & Manufacturing Co v Beiersdorf (Australia) Ltd [1980] HCA 9; (1980) 144 CLR 253 (‘3M’), Welch Perrin and Co Pty Ltd v Worrel [1960] HCA 91; (1961) 106 CLR 588 at 610, Kimberly-Clark Australia Pty Limited v Arico Trading International Pty Limited [2001] HCA 8; (2001) 207 CLR 1 at [15] – [17] and Populin v HB Nominees Pty Ltd (1982) 41 ALR 471, that integers not present in the claims are thereby added.
45 It is not uncommon for claims to be drafted that are narrower than the scope of the invention. Independent claims (and claims dependent on them) may reflect different aspects of the invention. The drafting of a patent claim generally represents a balance for the draughtsman. If the claim is drawn broadly, it will capture a wider range of infringing articles but will be exposed to a wider range of prior art for anticipation. The addition of integers narrows the scope of the claimed monopoly. As has frequently been said, the words of the claim are in the patentee’s own choosing and they fix the boundaries of the monopoly. It is the patentee that determines the essential integers of the drafted claim. It is not uncommon to draft a claim broader in scope than the strict "essence of the invention", although this may place the claims at risk of invalidity for lack of compliance with s 40(2) or s 40(3) of the Patents Act 1990.
46 While it may be of assistance to identify the essence of the invention, s 18(1) of the Act makes it clear that it is the invention, so far as claimed in the claims, that is to be assessed for novelty and inventive step. To our mind, the primary issue in the appeal is really the characterisation of the essential and inessential integers of the claims.
INFRINGEMENT
Principles
47 There is no dispute with the statement of principle on infringement as enunciated by his Honour. What is in dispute is the application of that principle.
48 His Honour referred specifically to 3M at [112]:
‘In the 3M case Aickin J, after referring to Clark v Adie (1875) 10 Ch App 667 and the doctrine of "pith and marrow", said at 286:
...it remains the law that a defendant may not take the substance of an invention unless the wording of the claims make it clear that the relevant area has been deliberately left outside the claim.’
49 The primary judge cited Populin at 475 where infringement was discussed in terms of the taking of the substantial idea or the substance of the invention that was made the subject of a definite claim. His Honour also concluded from the cases at [114] that ‘the interpretation of the specification and claims and the question of the resulting infringement or not is to be undertaken, as a matter of substance, having regard to the essence of the invention’. However, the Full Court in Populin also emphasised, as did Aickin J in 3M, that there is no infringement if the patentee has, by the form of the claim, left open what the alleged infringer has done. Their Honours stated, as a fundamental rule, the test for infringement as set out in Rodi & Wienenbirger AG v Henry Showell Ltd [1969] RPC 367 that there will be no infringement unless the alleged infringer has taken all of the essential features or integers of the patentee’s claim. This principle was reaffirmed by Gummow J in Nicaro Holdings v Martin Engineering (1990) 91 ALR 513 at 527.
50 Infringement is determined by the construction of the claim (Olin Corporation v Super Cartridge Co Pty Ltd [1977] HCA 23; (1977) 180 CLR 236 at 246 per Gibbs J; 3M at 286; Grove Hill Pty Ltd v Great Western Corporation Pty Ltd [2002] FCAFC 183; (2002) 55 IPR 257 at 311 per Gyles J; Sachtler GMBH & Co KG v RE Miller Pty Ltd [2005] FCA 788 at [43]- [56]). As the High Court said in Radiation Limited v Galliers and Klaerr Pty Ltd [1938] HCA 17; (1938) 60 CLR 36 at 51 in considering infringement, it is ‘the substantial idea disclosed by the specification and made the subject of a definite claim’ (emphasis added) that must be considered.
51 As was said in Clark v Adie (1875) 10 Ch App 667 at 675 and cited in Populin at 476, when considering infringement of a claim to a combination, a relevant question is whether the alleged infringement ‘is the same in substance and effect or is a substantially new or different combination’.
52 The specification is to be read in the light of common general knowledge before the priority date. The essential features are to be determined in the context of then existing knowledge, as the patent is addressed to those skilled in the art (Populin; Catnic Components Limited v Hill & Smith Limited [1982] RPC 183). The specification is to inform those skilled in the art what are the novel features claimed to be essential to the invention (Catnic).
Infringement of Claim 2
53 It is accepted that the Fresenius system contains each integer of claim 2, together with a measuring means and a flow regulating means. Those integers are included in the system of claim 1 but are absent from claim 2.
54 The relevant part of claim 2 is:
‘A system for preparing a dialysis or replacement fluid or a component fluid thereof by mixing of at least one concentrate in powder form with water, said system comprising: [the integers]’
55 As we understand the reasoning of his Honour relevant to this issue on appeal it is, in summary:
• The primary judge observed at [116], correctly in our view that, while a dictionary might be created in the specification, ascribing one meaning to a word wherever it is used, that does not mean that where no such dictionary is created, the one meaning is necessarily ascribed to a word when used in different contexts. An example of the different use in different contexts is the use of "comprise" in different parts of the specification.
• The word ‘comprise’ can mean consists of exhaustively, in the sense of constituted exclusively by, and also consists of non-exclusively, in the sense of include [117].
• There may be more parts necessary for the system to work than those identified in the claim. These would be recognised as practical and necessary parts of any working system for the relevant treatment, such as haemodialysis [119].
• However, the patentee has sought to identify in the claims what are the inclusions and exclusions of the boundaries of the respective monopolies [119].
• The patentee has sought to identify, and so claim, the essence of the invention [119].
• The real question is whether claim 2 excludes as an integer of the system, certain integers that are included in claim 1 [121].
• In the existing art some haemodialysis machines used measuring means and flow regulating means and some did not [121].
• The essence of the invention in the claims (narrowed to a system for the production of fluid for ‘dialysis or replacement fluid or a component fluid thereof’) was the use of dry powder in a vessel and its dissolution by the introduction of water into the vessel to produce a saturated (and so constant) concentrate fluid that was then withdrawn from the vessel and dealt with in the customary way by the relevant machines [125].
• There were many conventional and well known aspects to any system to create a dialysis fluid or replacement fluid or component fluid thereof that were not part of the essence of the invention as claimed but were necessary for such a system to work. An example of this is a measuring device to control a fail safe system [127].
• There were also aspects which were not part of the essence of the invention as claimed and were not necessary for it to work but which could be added to such a system. An example of this is a measuring device to control or regulate flow of concentrate into the main line or first fluid conducting means [127].
• The presence of such devices (either necessary or not necessary) in one claim does not lead to the conclusion that their absence in another claim was intended to limit that claim to a formulation of the system without such devices [128].
• The word "comprise" in claim 2 is not exhaustive. That is, it effectively means "includes". Its use does not mean that a claim is infringed by the inclusion in a system of additional integers which are not part of the essence of the invention, even if present in other claims [132-133].
• Noting the textual difficulties revolving around the word "comprise", the presence of the measuring means and the regulating devices which were not present in claim 2 and were present in the Fresenius system did not preclude infringement because ‘[t]hey are not part of the essence of the invention’. They may be claimed, for example by identifying their placement (claim 50) or their technique (claims 52 and 55) and so limit the claimed monopoly [131].
56 There are two issues:
(1) Whether "comprise" means "consists only of" or "includes". If it means "consists only of"; does the presence of the additional integers, the measuring means and the flow regulating means, thereby avoid infringement of claim 2?
(2) Whether the additional integers in the Fresenius system otherwise avoid infringement of claim 2.
Comprise as used in claim 2
57 Fresenius submits that in claim 2 "comprise" means "consists only of" and that the presence of those integers in claim 1 but not in claim 2, make those integers essential in the system of claim 1 and thereby excludes them as integers of the system of claim 2. It is not in dispute that the meaning of "comprise" is context driven.
58 His Honour said this about infringement at [132]:
‘What is important in claim 2 is that the essence of the invention is there identified. The word "comprise" even given the content of the balance of the specification does not permit the escape from infringement by inclusion of elements, referred to in other claims, which, conformably with the known prior art, are either necessary for, or available to be used in, a working system and which are not part of the essence of the invention revealed in the claims and the specifications as a whole.’
59 His Honour’s reasoning is further set out at [133]:
‘This does not leave the invention at large. It means that one does not escape infringement by having somewhere in the system for preparation of the fluid or a component thereof one or more of the numerous aspects of the working implementation of the system known by the skilled addressee to be necessary or optional outside what the specification as a whole, and in the knowledge of the prior art, teaches about the essence of the invention. In this sense, the word "comprise" is not exhaustive in claim 2.’
60 Fresenius contends that his Honour accepted, correctly in its submission, that, in claim 2, the word "comprise" means "consists of" and not "includes". Therefore, it is said, there should have been a finding that the presence of the additional integers resulted in non-infringement. The primary judge considered the meaning of the word "comprise" at some length ([117]-[132]). As we read his reasons, after weighing the competing textual analyses, his Honour ‘not without some hesitation’ decided on a non-exhaustive meaning.
61 Fresenius also submitted that the uses of the expression "further including" in claims dependent on claim 2 supported the meaning of "consists only of" for "comprise".
62 The specification describes the measuring means and flow regulating means as one aspect of the invention. They are included in claim 1. The second source of concentrate is another aspect. That is included in claim 2. The vessel containing the powder concentrate is described as another aspect of the invention. That is included in claim 4. The measuring means and flow regulating means are added into the system of claim 2 in dependent claims 50 and 51 respectively, introduced with the words "further including". As we see it, this narrowing supports the non-exhaustive meaning of "comprise" in claim 2. It is also to be noticed that those dependent claims do not simply add those means; they position them in the system.
63 The measuring means and flow regulating means are not included as integers of claim 2. It is not in dispute that the integers of claim 2 are present in the Fresenius system. However, so too are measuring means and flow regulating means. It was not suggested by Fresenius before the primary judge that there was any evidence that the Fresenius combination achieved a new working of the system compared to the system of claim 2. Nor was there an allegation of lack of utility of a system with either or both of the devices absent. The devices facilitate the use of the claimed system for preparing a dialysis or replacement fluid in conjunction with a dialysis machine.
64 The primary judge gave detailed consideration to the contextual issues. Where the specification (including the figures) describes a number of additional elements that can be added to the system, such as a pump, an aeration device, a flow regulating device and a measuring means, it seems to us that, in drafting claim 2, "comprise" was not intended to mean and does not mean "consists only of". The components of the system there described were not meant to be exclusive of other components that might facilitate the use of the system. What is claimed is a system that includes those specified integers. This is the conclusion reached by the primary judge and it has not been shown to have been reached in error.
The presence of the additional integers
65 Fresenius relies upon Radiation Limited at 52, where Dixon J said:
‘Sometimes a claim, particularly a claim for a combination, is expressly confined to a particular form of construction or the like, and in such a case it is useless for the patentee to complain that his idea of what he calls his principle has been applied in a different construction or has been expressed by means of a mechanical equivalent of some element which his claims make of the essence of his monopoly.’
66 Dixon J there referred to a mechanical equivalent of an essential integer or the application of the principle or essence of the invention to a different construction. That is not the case here. There is no replacement of an integer of claim 2; there is the addition of two integers that the primary judge held were either necessary for a system utilising the invention to work or which could be added to such a system. In neither case were they part of the invention. There was no allegation of lack of utility of the invention as claimed in, inter alia, claims 2 and 4. There has been no ‘different construction’ and no mechanical equivalent of an integer of the invention. The principle enunciated in Radiation Limited is not applicable to the infringement of claim 2.
67 His Honour gave examples of additional integers that might be added. It is not necessary to consider those examples for the purposes of determining the question whether claim 2 permits additional integers to be included and thereby escape infringement.
68 It is not at all unusual for the patentee to add integers in order to restrict the scope of a claim. The fact that an integer is made essential in one claim does not make it essential to another, where the patentee has chosen not to include it. His Honour applied this reasoning to conclude at [128]:
‘In the circumstances, the fact that one claim included such devices that were neither practically necessary, nor part of the essence of the invention, would not be likely to lead one to the conclusion that the absence of such devices from another claim was intended to limit that claim to a formulation of the system without such devices.’
69 These additional integers were not part of the essence of the invention. This does not preclude their presence as essential integers of a claim. They were, as his Honour found, devices commonly used in the type of system claimed.
70 However, the inclusion of additional integers to a claimed combination does not necessarily avoid infringement. If those additional integers are properly characterised as inessential or do not make a new working of the combination and all of the essential integers of the claimed combination are present, there will be infringement. Where a patentee defines the claimed invention as consisting of a number of essential integers, it is no answer to infringement that the claimed combination is taken but additional integers are added that do not affect and are not part of the invention.
71 We reject Gambro’s submission that continuous on-line preparation of B concentrate is necessarily involved in the system of claim 2. Gambro relies upon the opening words of claim 2: ‘[a] system for preparing a dialysis or replacement fluid or a component fluid thereof by mixing of at least one concentrate in powder form with water’. However, those words are followed by ‘said system comprising’ and the integers follow. We accept Gambro’s submission, which has relevance also in the consideration of the alleged anticipations, that the claimed system must have all integers of the claimed combination present at the one time. That is made clear in the specification and reflected in the claims. It also leads to the result required by the introductory words of the claim. We do not accept that those introductory words in effect turn the claim for the combination of the system into a method claim, such that it is construed as if the on-line aspect were part of the claim.
72 Gambro does not suggest that claim 2 is a method claim but sought to support the importation into the construction of the claims the "limitation by result" said to arise from the introductory words. This, Gambro submitted, was consistent only with on-line preparation of concentrate solution. However, as in Atlantis Corporation Pty Ltd v Schindler (1997) 39 IPR 29 at 49, per Wilcox and Lindgren JJ, those words do not, whether they appear in the claim or draw upon the body of the specification, convert what is truly an apparatus claim into a method or process claim.
73 The limitation expressed in the words ‘[a] system for preparing a dialysis or replacement fluid’ makes it clear that the invention as claimed is a system for the delivery of a prepared fluid "for use" in a haemodialysis system and does not require immediacy of use or use "on-line". This limitation serves to limit the monopoly to the medical procedure of haemodialysis. This restriction can be understood in the context of the specification which refers to the use of the system in medical procedures generally.
74 The Fresenius system contains each of the integers of claim 2. The fact that it also has other components, not included in the invention as claimed in claim 2, does not take it outside infringement in circumstances where the primary judge found, and it is not disputed, that those components are not essential to the invention as described and do not create a new working of it. Mr Catterns QC who appeared with Ms Howard for Gambro asserted that it was not claimed, nor was evidence led before the primary judge, that the additional integers created a new working combination. Mr Burley who was led by Mr Archibald QC for Fresenius, pointed to the different location of the additional integers. However, the effect of that location was not established before the primary judge, he did not deal with it and it is not a ground of appeal.
75 It is useful, though not determinative, to test the proposition by asking whether the Fresenius system would be held to anticipate claim 2. All of the integers of the claim are present and disclosed; the claim would be anticipated.
76 In our view, claim 2 is infringed by the Fresenius system. As was accepted before the primary judge, infringement of claim 2 means that claims dependent on claim 2 are also infringed.
Infringement of Claim 4
77 The issue is whether the Fresenius system with the biBag as the vessel infringes claim 4.
78 Claim 4 of the patent is:
‘A system for preparing a dialysis or replacement fluid or a component fluid thereof by mixing of at least one concentrate in powder form with water, said system comprising:
a source of water;
a vessel containing a powder concentrate, said vessel including an inlet at the top thereof and an outlet at the bottom thereof;
first fluid conducting means having a first end communicating with said source of water for withdrawing water from said source of water, and a second end for delivering a prepared fluid;
second fluid conducting means communicating with said source of water and with said inlet of said vessel for introducing water from said source of water into the top of said vessel, whereby a concentrate solution containing dissolved powder concentrate in water is produced in the vessel; and;
third fluid conducting means communicating said outlet of said vessel with a mixing point located in said first fluid conducting means intermediate said first and second ends for conducting said concentrate solution from the bottom of said vessel into said first fluid conducting means where it is mixed with fluid being conducted through said first fluid conducting means to thereby produce the prepared fluid, wherein the system is arranged such that a relatively constant concentration level of dissolved powder concentrate is maintained is said third fluid conducting means by fluid being conducted through said vessel from its top to its bottom.’
79 The primary judge accurately observed at [150] in respect of the biBag:
‘There is no hole or aperture in the biBag at the bottom. Rather, a tube inside the vessel, with a filter at its end at the bottom of the vessel draws fluid from the bottom of the vessel and takes it to the intermediate annulated ring at the top of the vessel.’
80 The primary judge noted the definitions of outlet as ‘an opening or passage by which anything is let out, a vent or exit’ (Macquarie Dictionary) or ‘an opening by which something escapes or is released; a means of issue or exit’ (New Shorter Oxford (1993)). His Honour recognised that there is no opening of the vessel at the bottom of the vessel. However, his Honour accepted that the third fluid conducting means included the tube that is in the Fresenius biBag and that the concentrate enters the third fluid conducting means at the bottom of the vessel but inside the vessel. He acknowledged that, looking at the exhibit which is the biBag, ‘one is tempted to view the outlet of the vessel as at the top of the vessel...because that is where the hole is which delivers the concentrate from inside the vessel to outside the vessel’ at [155] (emphasis added). His Honour looked to the biBag as used, in operation and as part of the dialysis system. Viewed as part of the third fluid conducting means which begins on the internal side of the filter at the end of the tube at the bottom of the vessel, he concluded that there is an outlet at the bottom of the vessel into the third fluid conducting means.
81 In his Honour’s analysis, the third fluid conducting means itself becomes the outlet, being the outlet for the fluid concentrate from the column and conducting it, internally in the vessel, from the bottom of the biBag to the top where it leaves the vessel. There is, however, no outlet from the vessel at the bottom. The primary judge relied on the evidence of Professor Schindhelm who saw the tube in the biBag as part of the third fluid conducting means and who saw no functional difference in part of the third fluid conducting means being inside the vessel from an aperture at the bottom of the vessel. His Honour concluded:
‘Examining the matter functionally, the fluid concentrate leaves the powder column and the vessel at the point it passes through the filter into the third fluid conducting means at the bottom of the vessel. In this sense, though the vessel is not cut or pierced at the bottom, nevertheless there is an outlet at the bottom.’
82 Put simply, in the case of the biBag, the concentrate leaves the column at the bottom of the column, which is at the bottom of the vessel. The concentrate enters a tube (the third fluid conducting means) which does not exit the vessel at the bottom thereof but conducts the concentrate to an opening at the top of the vessel. Acknowledging at [158] that the biBag is not cut or pierced at the bottom, his Honour viewed the matter ‘functionally’ and said: ‘[i]n this sense, though the vessel is not cut or pierced at the bottom, nevertheless there is an outlet at the bottom’. Looking at the claim "purposively" his Honour found at [159] that the ‘precise location of the break in the skin of the vessel through which the fluid passes into the intermediate ring and continues along the third fluid conducting means in functionally immaterial’. The conclusion was that "what is taught by the claims, read in the light of the specification’ is that the outlet of the vessel is where the concentrate enters the third fluid conducting means and thereby exits the vessel and that point of exit is at the bottom of the vessel.
83 His Honour found that there was no functional advantage obtained by running the tube inside the bag up to the standard annulated fixture at the top. He concluded that the substantial idea disclosed by the body of the specification and made the subject of the claim 4 has been taken and embodied by the respondent in the biBag: (Radiation Limited at 51; Populin at 41; Bartlem Pty Ltd v Cox Industries (Aust) Pty Ltd [2002] FCAFC 224; (2002) 55 IPR 449, 477-78 [59]).
84 It is the case that each of the claims under consideration, including claim 2 and claim 4 commence with the words ‘[a] system for preparing a dialysis or replacement fluid or a component fluid thereof by mixing of at least one concentrate in powder form with water, said system comprising...’. However, there is a need to consider each claim as drafted by the patentee, in the context of the specification and to recognise that there are a series of claims, dealing with different aspects of the invention. Each claim seeks to define an aspect of the invention and the monopoly sought. In considering claim 2, his Honour recognised that it was a separate claim dealing with one aspect of the invention and that, while the system as claimed in the claim was "fed" into a larger system for dialysis, it had to be considered in its own terms. The same can be said for claim 4.
85 Relevant to the consideration of infringement of claim 4 are the words: ‘a vessel containing a powder concentrate, said vessel including an inlet at the top thereof and an outlet at the bottom thereof.’ (emphasis added) This clearly refers to the vessel itself. The claim clarifies the matter further. The second fluid conducting means communicates with the source of water and with ‘said inlet of said vessel’. The third fluid conducting means communicates ‘said outlet of said vessel’ with a mixing point. The third fluid conducting means conducts said concentrate solution ‘from the bottom of said vessel’ into the first fluid conducting means. The fluid is conducted through the vessel ‘from its top to its bottom’.
86 The primary judge’s analysis looks to where, functionally, the concentrate solution leaves the vessel, in that it enters the third fluid conducting means which itself has an entry at the bottom of the vessel. The claim, on the other hand, speaks of a vessel containing a powder concentrate with an inlet at the top of the vessel and an outlet at the bottom of the vessel. The third fluid conducting means of the claim communicates the outlet of the vessel with a mixing point in the first fluid conducting means.
87 As part of his reasoning of the construction of claim 4, His Honour reiterated the ‘essential integer’ of the use of the powder in a vessel and dissolution of it by water on-line, which does not appear in the words of the claim. Fundamental to his Honour’s reasons on this aspect was the lack of functional advantage of the biBag over the vessel of claim 4. Fresenius disputes that absence of functional difference but that is not to the point. Functionally, his Honour relied upon ‘what is taught by’ the claims, read in the light of the specification, rather than what is defined by the claims (s 40(2)(b) of the Act). If the description of the vessel as having an inlet at the top and an outlet at the bottom were an inessential integer of the claim, functional equivalence would be relevant to infringement. However, there is no infringement if an essential integer is replaced by a mechanical equivalent. As pointed out in Blanco-White 4th edition at 2-208, to characterise a feature set out in the claim as not an essential feature of that which is claimed and consequently to disregard it in determining the scope of the claim, is rare. The question whether differences in construction of the biBag are material to functionality is not relevant (Walker v Alemite Corporation [1933] HCA 39; (1933) 49 CLR 643 at 657; Bartlem at [84])
88 As was said by Lord Parker in Fellows v Thomas William Lench Ltd (1917) 34 RPC 454 at 55 and adopted by Dixon J in Walker v Alemite at 656, there may be reasons for the scope of a claim known to the inventor but not to the court.
89 Dixon J continued at 657:
‘The question is not whether the differences of construction in the respondent’s nipple and in that of the appellant are material to the utility of the appliance or to the manner of performing its function or whether ingenuity is involved in the changes. The question is: How wide is the monopoly? Once it is determined that the discarded features are essential to the claim, the substitution of other means of performing the like function cannot amount to infringement by colourable variation, or by the use of a mere mechanical equivalent. The changes are not insubstantial variations in detail under colour of which the thing claimed is taken. They are not other mechanical embodiments of the inventive idea for which protection has been obtained. The claim itself makes them cardinal. The intention of the appellant to take advantage of the narrowness of the monopoly is, of course, immaterial.’
90 In Azuko Pty Ltd v Old Digger Pty Ltd [2001] FCA 1079; (2001) 52 IPR 75, while there was a difference of opinion on the construction of the claim under consideration, both Heerey J in dissent (at [77] and [83]) and Gyles J (at [157]) confirmed that once an essential integer or feature is missing, the question of functional significance is irrelevant.
91 This is not a case where the scope of the claim can, by the purposive construction of a word, be expanded to include the allegedly infringing article. The application of purposive construction has recently been considered in Sachtler at [42] – [44], [46] – [56], [62] and at [114]. As discussed in Sachtler, previous cases in Australia (such as Populin) and the United Kingdom (such as Catnic) stand for the proposition that the essential integers are determined by a common sense assessment of what the words of the claims convey in the context of then-existing published knowledge. So-called ‘purposive construction’ does not propound a novel principle.
92 One does not look to see whether the allegedly infringing article is the same in substance and effect as the disclosures of the specification or of the claims. The principle of "pith and marrow" applies to immaterial variations where an inessential part or step is omitted or substituted. There is no infringement if a variant has a material effect on the way the invention works (Sachtler at [51]-[52]). However, this does not mean that there is infringement where there has been no taking of all the essential integers of the claim (Olin at 246 per Gibbs J). The form and wording of the claim are determinative.
93 As Gyles J said in Grove Hill at [311] ‘a patentee cannot eat the cake and have it too by persuading a court to construe a claim more widely than the patentee was prepared to risk when framing the claims under the guise of purposive construction’.
94 The whole of the specification must be read in order to construe the claim. So much is not in dispute. However, that does not mean that the words of the claim are to be ignored. Nor can it be ignored that the patentee has chosen not to include in a claim matters, integers or aspects of the invention that have been referred to in the body of the specification. This accords with the well-accepted principle enunciated in Welch Perrin at 610 that glosses drawn from the body of the specification cannot be used to narrow or expand the boundaries of the monopoly as fixed by the words of a claim.
95 In our view, the primary judge was in error in looking to what was "taught" by the claims, rather than what was claimed. To our mind, his Honour impermissibly construed the claim with an eye to the allegedly infringing article.
96 The vessel as identified in claim 4 is an item that is a discrete component of the system with which the third fluid conducting means communicates. The claim requires that the vessel and communicating means be distinct. The third fluid conducting means must communicate with the vessel. There must be an outlet from the vessel and that outlet must be at the bottom of the vessel.
97 His Honour focussed on the words requiring the outlet to be "at the bottom" of the vessel and construed them to require simply a physical location at the bottom of the vessel but not an outlet from the vessel at the bottom thereof. This ignores the words later in the claim requiring the third fluid conduction means to communicate the said outlet of the said vessel with a mixing point.
98 These are clearly made essential by the patentee in the claim.
99 The words of the claim, when the whole of the claim is considered, are clear: the outlet is an outlet of the vessel. That is, there must be an opening in the vessel itself at the bottom of it. That is a clear essential integer of claim 4. Further, the body of the specification envisages a system where the concentrate fluid is conducted from the top to the bottom of the column in the vessel or, alternatively, from the bottom to the top. The opening at the bottom of the vessel, at the bottom of the column, permits the exit of fluid from the column to the third fluid conducting means. The third fluid conducting means is not the outlet, it communicates or connects the outlet with a mixing point and conducts the concentrate solution from the bottom of the vessel.
100 When the claim is read in the light of the specification as a whole, including the figures, there can be no doubt that the outlet of the claim is an outlet both located at the bottom of the vessel and an outlet from the vessel. For example, at page 17 in the specification, lines 17-30 there is described a ‘powder concentrate columns or vessels’ in the form of a cartridge with penetrable membranes ‘at its upper inlet and its lower outlet which are adapted to be penetrated by suitable connection devices’. At page 25, lines 20 to 23, there is reference to the vessel which includes ‘an inlet at the top thereof and an outlet of the bottom thereof’ (emphasis added).
101 This interpretation and requirement is also reinforced by the figures in the patent. Each of the figures shows a vessel with an outlet of the vessel at the bottom of the vessel. There is no suggestion in the specification of a vessel with other than an outlet from the bottom of the vessel.
102 By looking at the functionality of the biBag, rather than the clear wording of the claim, as supported by the specification, his Honour has substituted a mechanical equivalent of an essential integer of the claim. This is not permissible for the purposes of ascertaining novelty or infringement. The patentee has, by the wording of the claim to an apparatus, left open the design of the biBag.
103 The words of Dixon J in Radiation Limited, cited in [66] are apposite. Put another way by Aickin J in 3M at 286, a defendant cannot take the substance of the invention unless the wording of the claim makes it clear that the relevant area has been deliberately left outside the claim. Then, if the substantial idea is taken in a way so left open, there is no infringement. That is the case here.
104 If claim 4 is construed in a commonsense or "purposive" manner, in the sense properly envisaged in Catnic and Populin (see Sachtler), it is apparent that ‘an opening at the bottom of the vessel’ means an opening of the vessel at the bottom thereof. In looking to a "purposive" construction of the claim his Honour seems to have overemphasised the substantial idea disclosed in the body of the specification and effectively disregarded the words of claim 4.
105 As in Populin, the Fresenius system uses a good deal of the concept of the Gambro invention. However, the requirement for the vessel itself to have an inlet at the top and an outlet at the bottom is an essential feature of the claim. This is apparent, not only from the wording of the whole of the claim to the apparatus but also from the specification and the figures.
106 The Fresenius system with the biBag does not infringe claim 4.
Ground 8: claim 4
107 The relevant words of the claim that are in issue here are ‘wherein the system is arranged such that a relatively constant concentration level of dissolved powder concentrate is maintained in said third fluid conducting means by fluid being conducted through said vessel from its top to its bottom’.
108 Fresenius relies on the word "by" and submits, in effect, that the fluid being conducted through the vessel from top to bottom must be the sole cause of the maintenance of concentration. In the biBag, there is a combined operation of a mix achieved by diffusive and osmotic flows and the bulk flow of the solution from top to bottom.
109 As the evidence of the working of the biBag, cited by his Honour at [169] sets out, ‘water is not simply passed through the column of powder concentrate’ (emphasis added). His Honour continued, as summarised by Fresenius in its written submissions ‘[t]he fluid in the biBag experienced a pressure-driven reversal during its operation and diffusive and convective forces operated to impact on the dissolution of the powder before the solute was withdrawn’.
110 The findings of fact by the primary judge at [169] and [170] are that, while the factors that determine the dissolution of the solute and the production of concentrate solution are more complex in the biBag than the mere conducting of fluid ‘through said vessel from its top to its bottom’, there is bulk flow of the solution from the top of the vessel to the lower region of the vessel.
111 This establishes that the necessary integer, of the conduct of fluid from top to bottom, is present and that this is relevant to the maintenance of concentration of the dissolved powder.
112 Fresenius also relies upon the finding of the primary judge that the principles governing percolation were central to the inventive idea and submits that, as the biBag does not rely on percolation, there is no infringement.
113 As his Honour observed at [173], the requirement of the claim is met by the conducting of the fluid through the vessel from its top to its bottom. No error has been established as to this aspect of his Honour’s reasoning.
114 This aspect of the biBag does not avoid infringement.
Ground 9: is the biBag a cartridge?
115 The claims in question (claims 28, 80 and 81) use the word ‘cartridge’. The qualification is that the cartridge contains a quantity of powder concentrate. The specification describes the cartridge as being totally closed and provided with penetrable membranes at its upper inlet and lower outlet which are adapted to be penetrated by suitable connection devices. Preferably, it is internally sterile and is adapted to be mounted in a holder.
116 Fresenius submits that, in "normal usage", a cartridge is not a flexible, foldable container that will expand or contract depending on its contents. Attention is also drawn to different usages in the specification of "cartridge", "column", "vessel" and "plastic bag". It is submitted that, in the context of the patent, "cartridge" connotes a vessel with rigid walls for insertion into a chamber or to be integrated into the system at its top and at the bottom. Fresenius asserts that the biBag is made of soft, flexible plastic. Gambro asserts that it is made of heavy grade plastic and becomes rigid under its operating conditions.
117 The primary judge was of the view at [178] that, ‘in the context of the particular application and of the invention it means something containing a pre-determined amount of powder concentrate to be placed into the hydraulic system for a single use and thereafter to be disposed and replaced’. The biBag fulfilled that meaning. His Honour did not accept that the vessel must have rigid walls to be a cartridge or that it needed to be integrated into the system at its top and its bottom. We see no error in that conclusion.
118 While the specification describes the means of fixing of the cartridge into the system, the claim does not include means of fixing as an integer. The mere use of the word cartridge does not, in our view, import a particular mechanism of fixation into the system. In any event, as his Honour noted, the biBag does fix to the machine. In that way, it becomes part of the system as required by the claim.
119 No error has been shown in his Honour’s conclusion that the biBag is a cartridge within the meaning of the claims.
Ground 10: are the biBag and the second fluid conducting means of the Fresenius system so arranged and dimensioned so as to produce a saturated solution?
120 Claim 88 is:
‘A system according to any one of claims 28 to 30, wherein the powder concentrate is arranged as a column between the inlet and outlet of the cartridge so that, in operation, the powder concentrate becomes dissolved in water flowing through the vessel, and said second fluid conducting means and said cartridge are so dimensioned, as to produce a substantially saturated solution of the powder concentrate in water.’
121 The primary judge found infringement. This followed relevantly from his findings on the outlet of the vessel.
122 Fresenius submits that claim 88, which is dependent on claim 28, is not infringed if claim 4 is not infringed. Claim 28 is, in turn, a system of claim 1, 2 or 4 wherein the vessel comprises a self-contained cartridge containing a quantity of powder concentrate suitable for one treatment procedure.
123 To the extent that the claim is dependent on claim 4, there is no infringement.
124 As submitted by Fresenius, even though the biBag is a self-contained cartridge within claim 28, claim 88 requires that the powder concentrate is arranged as a column between the inlet and outlet of the cartridge. The inlet and outlet of the cartridge are at the top of the biBag. The column is not arranged between that one outlet. That essential integer is missing. There is no infringement of claim 88.
NOVELTY
125 Two prior published patents were relied upon as anticipations. There is no dispute about the principles that should be applied. They are as set out in Meyers Taylor Pty Ltd v Vicarr Industries Ltd [1977] HCA 19; (1977) 137 CLR 228 at 235; that is, the reverse infringement test.
126 Fresenius’ submissions cite examples from his Honour’s reasons at [206] and [258] that are said to suggest that his Honour tested anticipation by a comparison of the disclosures and teachings of the prior art and the disclosures and teachings of the patent rather than the claims. Similarly, Fresenius submits that, for inventive step, his Honour at [350] considered wrongly the teaching of the claims, when read with the body of the specification in the knowledge of the prior art in order to determine whether there was an inventive step in the invention the subject of the claims.
127 Two issues arise for consideration. First, did the primary judge err in the test that he applied for anticipation? Secondly, do either of the two prior art patents now relied upon anticipate the relevant claims?
The Stasz patent
128 Fresenius asserts that the invention, as claimed in claims 2, 4, 28, 35 and 88 of the patent, has been anticipated by the disclosures of Stasz.
129 The primary judge said, at [206], that the patent discloses the continuous on-line production of concentrate and its mixing with water on-line. Stasz did not disclose such a continuous on-line system which, his Honour had found, was the essence of the invention. That was sufficient for his Honour to conclude that there was no anticipation by Stasz. If this were the entire basis for his Honour’s findings on novelty, there would not have been a proper analysis of that question. It is not a question whether the prior art disclosure disclosed the "essence of the invention" or the teachings of the body of the specification.
130 If the claims in question did not require a continuous on-line system which, in our view they did not, his Honour was in error in comparing, for determining novelty of the invention so far as claimed in any claim (s 18(1) of the Act), the disclosures of Stasz with the disclosures of the specification of the patent. However, his Honour turned to consider the integers of the claims themselves and whether they were disclosed in Stasz.
131 The abstract of Stasz is:
‘A proportioning system for preparing hemodialysis or hemofiltration solutions. The apparatus of the system is a specially plumbed tank containing a flexible plastic container which holds solution concentrate. Introduction of pressurized water into the tank outside the bag discharges concentrate and water through separate paths into a mixing chamber at a rate determined by the size ratio of narrow orifices in the respective paths.’
132 As noted by the primary judge at [196], Stasz provides a system for preparing a dialysis or replacement fluid or component fluid thereof. What is described is a two-staged process controlled by valves. As recorded by the primary judge at [200]–[203], Gambro had submitted that at no point is there a moment where the integers identified in the patent, the first, second and third fluid conducting means, are present at the same time. Further, none of integers relating to the conducting of fluid from the top to the bottom of the vessel through the powder concentrate was present. In Stasz, the first fluid conducting means and the third fluid conducting means are both connected to the top of a collapsible flexible container in which a predetermined amount of solute is contained.
133 Claims 1, 2 and 4 of the patent are each to a system that comprises a number of integers, including the three fluid conducting means. The claimed system is a product, a combination, not the working of the system. The integers are present in the system at the same time. There is no suggestion in the claims or in the body of the specification that the combination of integers is present other than at the same time. Nowhere does the specification, including the claims, suggest that the claimed combination can be worked in sequence in the way described in Stasz.
134 Fresenius asserts that, in his analysis of infringement, his Honour was in error in importing into the claims a requirement for continuous on-line production in the working of the system. Fresenius then submits that the working or production of Stasz over time should be considered for anticipation. Fresenius recognises in its written submissions that there is no literal disclosure of an on-line or continuous working integer but submits that, if a ‘functional’ or ‘purposive’ construction is to be taken to import an on-line requirement into the claim and to find infringement of the biBag then, by parity of reasoning, a ‘functional’ or ‘purposive’ approach must apply to the vessel of Stasz.
135 We agree that there must be a consistent approach. We have rejected the importation into the claims of a continuous on-line production or method integer. Accordingly, as such an integer would be necessary for Stasz to anticipate, it does not do so. The combination, as an apparatus, is not disclosed in Stasz.
136 Claim 2 requires a fourth fluid conducting means connected to a second source of concentrate. The primary judge concluded that there was not sufficient disclosure of these integers. However, even if there were sufficient disclosures, the second source of concentrate could only operate temporarily. Accordingly, the system as claimed in claim 2, to a combination of which the fourth fluid conducting means and second concentrate solution are essential integers, is not disclosed. Stasz does not disclose a system that comprises the integers of claim 2.
137 For the same reasons and the additional reasons that the Stasz plastic container does not have an outlet at the bottom thereof and that the third fluid conducting means does not conduct the concentrate from the bottom of the vessel, his Honour was not in error when he concluded at [227] that claim 4 is not anticipated. These essential integers are not disclosed.
138 It follows from the reasons given above for considering that the biBag is a "cartridge" for the purposes of the claims, the vessel described in the Stasz patent is, as submitted by Fresenius, also a cartridge. It is, in the words of the primary judge in describing the biBag as a cartridge at [178], ‘something containing a pre-determined amount of powder concentrate to be placed into the hydraulic system for a single use and thereafter to be disposed and replaced’.
139 However, as the primary judge points out at [240], the claim to the system, including the cartridge in claim 28, is a claim to the system of, relevantly, claims 2 or 4. As Stasz does not disclose the systems of those claims, there is no anticipation of claim 28. It follows that claims 80 and 81, dependent on claim 28, are also not anticipated.
140 Further, Stasz does not contain "clear and unmistakable directions" to produce the systems of the combinations claimed in the patent: Canadian General Electric Co Limited v Fada Radio Limited (1930) 47 RPC 69 and authorities discussed by Black CJ and Lehane J in Bristol-Myers Squibb Company v FH Faulding & Co Ltd [2000] FCA 316; (2000) 46 IPR 553 at [61]- [67].
The Mund patent
141 Fresenius submits that claims 1 and 4 are anticipated by Mund.
142 The primary judge again rejected Mund as an anticipation because ‘it does not teach, as the Patent does, a continuous on-line production of concentrate’ (at [258]). This is not, with respect to his Honour, the correct test of novelty under s 18(1) of the Act.
143 However, the primary judge then examined the integers of the claims to determine whether there was disclosure of those integers in Mund.
144 The primary judge had summarised the system of the Mund patent at [259]:
‘It is a system for mixing a cycle or batch of concentrate for use in a dialysis device. It does not involve a vessel containing powder concentrate; it does not involve a second fluid conducting means communicating with a source of water and an inlet of the vessel and a third fluid conducting means communicating with the outlet, at the same time; it does not involve any mixing points; it does not involve any integer relating to the conducting of fluid through a powder concentrate; it does not involve a cartridge.’
145 Claim 1 requires "a vessel containing a powder concentrate". His Honour had regard to the teaching of the claim and what ‘the claim encompasses’ to conclude that the requirement was for a vessel with powder into which the water from the second fluid conducting means flows. He then says that Mund ‘teaches a mechanical equivalent in this respect’. If this is an essential integer, substitution by a mechanical equivalent is not sufficient to establish want of novelty. The system of claim 1 requires in this regard, two integers: a vessel containing a powder concentrate and a fluid conducting means for introducing water from the source into the vessel to thereby produce a concentrate solution containing dissolved powder concentrate in water. The system of Mund involves introduction of powder into the water filled tank. Fresenius submits that, ‘at the point when the powder is introduced into the water filled tank, but before it is dissolved, the tank of Mund would be a vessel containing a powder concentrate.’
146 Claim 1 of the patent, in its terms, requires that water is added to a vessel that already contains powder concentrate. When the specification of the patent is considered in order to understand claim 1, this is clearly apparent. This essential integer is not disclosed in Mund. Accordingly, the combination of claim 1 is not disclosed.
147 The combination of the integers of the system of claim 1 is not disclosed by a system where, for an instant, it can be said that the vessel which contains water also contains a powder concentrate. As noted by his Honour at [262], a concentrate is not ‘thereby’ produced by introducing water into the vessel but by adding powder and mechanically mixing.
148 As the primary judge found, the integers of claim 1 are not present in the system at the same time. For example, the third fluid conducting means only communicates with the outlet of the vessel after the preparation cycle is complete.
149 In any event, claim 1 includes, as essential integers, a measuring means and a flow regulating means which are not disclosed in Mund.
150 For the reasons set out above, there is no anticipation of claim 1.
151 As his Honour observed, the same matters are relevant to claim 4.
152 Further, at [272] the primary judge found that the relatively constant concentration level of dissolved powder for passage into the third fluid conducting means of the Mund system does not occur by the fluid being conducted through the vessel from top to bottom as required by claim 4 but by being stirred and, when prepared, let out of the vessel. At [277] his Honour found that the relatively constant concentration level of dissolved powder concentrate is not maintained in the third fluid conducting means by water being conducted through the vessel from top to bottom, as required by claim 4. No error in this conclusion has been shown.
153 Mund does not contain "clear and unmistakable directions" to produce the result of the combination claimed in the patent.
154 Claim 4 is not anticipated by Mund.
OBVIOUSNESS
The first decision
155 The primary judge stated the question at [346]–[348] as whether the invention so far as claimed in any claim was obvious and did not involve an inventive step. This is the test in s 100 of the Patents Act 1952 (Cth). It is not said that his Honour applied the incorrect test or made an error of law. He emphasised at [348] that it was the invention as claimed that had to be shown to be obvious or not to involve an inventive step, as judged by the relevant skilled addressee.
156 His Honour then proceeded at [350] to refer to his view that the claims, when read with the body of the specification "teach" that the system is for continuous and on-line production of dialysis or replacement fluid. At [351] he characterised the invention as an improvement to the design and operation of dialysis machines to form a concentrate solution on-line. One question is whether his Honour impermissibly went beyond the invention as claimed in having regard to the "teachings" of the specification and the "essence" of the invention, as described by his Honour, of on-line continuous production.
157 The prior art and the teachings in the body of the specification are relevant to an understanding of the claims and the inventive step that led to the invention as claimed. As set out by his Honour at [351] the improvement, as claimed, involved a system and an article for use in a system dealing with the dissolution of powder in water or water based fluid capable of forming a concentrate solution on-line to be mixed into a flow of water by the types of well-known proportioning machines. The vessel of powder within the system obviated the use of a pre-prepared 10 litre bottle of solution.
158 His Honour, at [352], noted that Gambro submitted that the relevant inventive step was as follows:
‘(a) the appreciation that the problems with preparation of batch concentrates of sodium bicarbonate should and could be addressed;
(b) the conception of the idea that it would be advantageous to mix sodium bicarbonate powder concentrate with water at the point of treatment;
(c) the conception of the idea to produce liquid bicarbonate concentrate solution "on-line" from dry bicarbonate powder during treatment, in particular, the conception of the idea to use the hydraulic circuit of a proportioning dialysis machine to do this; and
(d) achieving this in existing dialysis machines by integrating the production of a solution within a continuous fluid flow path (i.e. the combination of integers employed to implement the idea).’
His Honour apparently accepted that the issue of whether the invention, so far as claimed in any claim, involved an inventive step as alleged, was to be determined by reference to the above description of the inventive step. It is apparent that the first three aspects involved the ideas which culminated in the fourth, the combination of the claims.
159 The inventive step is not necessarily coextensive with the invention as claimed. The requirement is that the invention, so far as claimed in the claims, involved an inventive step. It was not an error to examine the inventive step by reference to the specification and the purposes or object of the invention, a system capable of providing continuous on-line production. The primary judge accepted that the inventive idea as claimed by Gambro lay in part in the conception of the improvement in existing machines to implement on-line production of liquid bicarbonate concentrate solution.
160 On the question of obviousness, his Honour found that the use of percolation to improve dialysis systems was not obvious. He also found that the use of the vessel of powder within the hydraulic system of the machine was not obvious. That latter finding, involving an essential integer of the combination as claimed, was determinative of the finding of non-obviousness for each of the system claims in question. In coming to his conclusion, his Honour was mindful of the Cripps question as set out in (Aktiebolaget Hassle v Alphapharm Pty Ltd [2002] HCA 59; (2002) 212 CLR 411 at [53]). He answered the question in the negative. In each case, the primary judge carefully set out the evidence and his reasons for accepting or rejecting it.
161 Fresenius contended that the primary judge wrongly considered whether the invention involved an inventive step on ‘the basis that the invention resided in the continuous production of dialysis fluid’. It argued that, on his Honour’s analysis, if the idea of producing dialysis fluid on-line is disregarded, the subject matter remaining is indistinguishable from the prior art and hence obvious.
162 Fresenius stressed that that which was claimed did not involve the notion of on-line production of fluid. It submitted that:
‘the invention reflected in the claims is confined to the (self evident) appreciation that the bulk storage and precipitation problems caused by the batch preparation methods of the prior art required a solution ... and a solution of those problems by a particular method of storing the bicarbonate in a powder form before it is dissolved in water utilizing a proportioning system so that it could then be subsequently used (at a convenient time either immediately or later) as a fluid within the dialysis machine.’
163 Professor Klaus Schindhelm, whom the primary judge described as ‘an eminent clinical and biomedical engineer’, was called by Fresenius. He gave affidavit evidence as follows:
‘In my opinion the change made by Gambro to the existing dialysis systems is neither new nor inventive. The Patent involves the replacement, as a source of the bicarbonate concentrate solution, of a vessel containing liquid bicarbonate with a vessel containing bicarbonate in powder form to which water is added. No other change is made to the existing dialysis systems.’
164 Fresenius also contended that the primary judge concentrated on whether it was obvious to use a percolation system to achieve the reconstitution of the bicarbonate and that, because of this focus his Honour overlooked the absence in claims 1 and 2 of a requirement of the employment of a percolation system. In any event, Fresenius contended, the idea of dissolution of the bicarbonate by percolation was obvious. However, while percolation itself is not expressed as an integer of the claims, as made clear at [82]–[84] the term was used by the primary judge as a summary for the downward flow of water over and through a bed or column or arrangement of the solute.
165 The primary judge placed reliance on the evidence, which he accepted, that it was not usual to use percolation to obtain a solution of a specific concentration. He also observed at [417] that, if the conception were obvious and the principles to put it into effect basic, no explanation was given why the solution of the claims, which was admitted to be simple, effective and efficient, was not arrived at by others prior to the priority date.
166 In rejecting the contention that the idea of the dissolution of bicarbonate by percolation was obvious his Honour placed reliance on four factors (at [421]). First, that Professor Schindhelm accepted that it was not usual to use percolation to prepare a solution of a fixed concentration. Secondly, percolation or leaching had not been shown to produce solutions from pure solutes (as opposed to extracting a solute by leaching) other than in the case of sugar. Thirdly, none of the references provided by the expert witnesses called by Fresenius referred to production of dialysis fluids by passing water through a vessel. Fourthly, a chemical engineer with an understanding of concepts of mechanical or fluid engineering and experience in the preparation of fluids in medical contexts (Dr Davies), did not come to the idea of dissolving bicarbonate by percolation.
167 As mentioned above, the invention, so far as claimed, was defined by claims to a system for preparing a dialysis or replacement fluid and by claims to a cartridge arranged for use in such a system. The claims to a system are claims to a combination of integers. The integers combined in the manner claimed result, as his Honour correctly found, in a system capable of providing continuous on-line production of concentrate solution contemporaneously with production of dialysis fluid [351]-[378], albeit that this feature of the system is not an integer of any claim of the patent.
168 Fresenius bears the onus of establishing the case of obviousness. The danger of misusing hindsight is in this case particularly acute as what was claimed was a new and inventive combination of well-known integers (Alphapharm at [21]). Where the inventor has postulated a series of steps that led to the claimed invention, each of the steps and the combination of those steps are relevant in assessing obviousness and inventive step. As noted by Aickin J in Wellcome Foundation v VR Laboratories (Aust) Proprietary Limited [1981] HCA 12; (1980) 148 CLR 262 at 280-1, it may be the case that the perception of the problem was the inventive step which, once taken, is solved by straightforward experiments.
169 Further, the issue to be determined is whether the combination of the integers was at the relevant time obvious, not whether each integer regarded in isolation is obvious. Fresenius argued that an expert witness called by Gambro, Dr Wayne Alexander Davis, a chemical engineer, arrived quickly at a solution that fell within claims 1 and 2.
170 It was the conclusion that the relevant art was the design or improvement of dialysis machines or systems for which the system and article as claimed are said to be improvements (at [355]) that determined acceptance by his Honour of the expert evidence that His Honour found to be relevant to the issue of obviousness and determined the weight to be given to that evidence. In particular, his Honour drew a distinction between the evidence of a chemical engineer (Dr Davies), who would understand the well-known principles governing the dissolution of a well-known solute, a Professor of Physics (Professor Coster), who would understand the principles of a dialysis machine and the system and article as claimed as well as the principles of dissolution and percolation and a person accepted as being able to give evidence as a person designing and improving dialysis machines (Professor Schindhelm).
171 His Honour accepted that the principles of percolation were well-known but said, correctly in our view, that it does not follow that the production of a system using such principles in this art was obvious. His Honour accepted Professor Schindhelm’s evidence, in preference to that of Professor Coster, that it was not usual to use percolation to prepare a solution of a specific concentrate. We agree that, as stated at [365], the fact that the well-known nature of general principles employed to carry out the idea is obvious does not mean that the idea was obvious.
172 Dr Davies was not shown the patent but efforts were made to place him in the position of the relevant skilled worker at the priority date. That was done by providing him with relevant prior art on the composition of dialysis fluid and proportioning and monitoring equipment and information about dialysis machines. He was asked to develop or improve a system for preparing a dialysis or replacement fluid overcoming the limitations and disadvantages of the prior art. The primary judge set out in detail his analysis of Dr Davies’ evidence. He drew a distinction between the evidence before and after Dr Davies was made aware of the patent. On the basis that Dr Davies did not, after a week, arrive at the allegedly obvious answer of the claims, his Honour concluded that ‘[h]e was not led directly to an improvement which was a system’ comprising the integers of the claims. His Honour concluded at [399] that Dr Davies’ evidence was ‘powerful evidence against the conclusion of obviousness’, which was not outweighed by the evidence of Professor Coster or Professor Schindhelm.
173 Accepting that Professor Schindhelm was the only witness who possessed the relevant qualifications of a person skilled in the art, his Honour gave detailed reasons why he accepted the evidence of other witnesses, including Dr Davies. Fresenius has criticised his Honour’s reliance on Dr Davies’ evidence on the basis that his expertise was not that of the person skilled in the art. We accept that this is so. However, once Dr Davies was placed in the position of that person as at the priority date, his expertise with respect to fluid engineering might be expected to exceed that of the notional skilled addressee. For this reason it was open to his Honour, in our view, to infer that if Dr Davies did not come up with the idea of dissolving bicarbonate by percolation, the notional person of skill in the art would have been unlikely to do so.
174 The evidence of Professor Schindhelm that the patent involves the replacement, as a source of the bicarbonate concentrate solution, of a vessel containing liquid bicarbonate with a vessel containing bicarbonate in powder form to which water is added may, in one sense, be accepted. However, acceptance of the evidence does not lead inexorably to a conclusion that the invention the subject of the patent did not involve an inventive step. The invention will nonetheless involve an inventive step if the particular combination of the various integers of the invention involved an inventive step.
175 In coming to his conclusion on obviousness, his Honour was mindful of the restraint imposed by the artificial exercise engaged in by Dr Davies and of the alternative problem of a witness attempting to give evidence of the obviousness idea when he or she already knew the answer. This is particularly acute where the inventive step involved an idea which, once appreciated, was implemented by the application of well-known principles. That is not to say that such evidence should be disregarded but it makes it more difficult to allow for ‘the insidious effects’ or ‘misuse’ of hindsight. This problem has long been recognised in patent cases. It is but one matter for the judge to take into account in weighing the evidence of the witnesses, as was the inventiveness of the witnesses (at [401]), the passage of time since the priority date (at [402]) and the provision of prior art which was not part of common general knowledge (at [403] and [404]–[406]). Other factors were the level of advocacy engaged in by the witnesses and the relative levels of skill each possessed. None of these matters is determinative; each is relevant to the assessment by the judge of the competing evidence on obviousness in the circumstances of this case.
176 Fresenius contended that his Honour erred in concluding that the evidence was sufficient to sustain a conclusion that the subject matter of the patent had enjoyed commercial success. The primary judge referred to the apparent commercial success of the subject of the patent as one of a number of factors that ‘fortified’ the conclusion that he had already reached following a careful analysis of the evidence (at [426]). He further observed that:
‘[O]ne needs to exercise caution in taking too much from the indicia of some commercial success without a complete understanding of the business and the market it trades in, in particular one needs to recognise that such indicia are not to be used as a surrogate for analysis of the evidence of the art and the relevant principles, they are considerations which are not foreign to drawing an overall conclusion as to whether the respondent has proved that there was no inventive step ....’ (citation omitted) (at [428])
177 In the circumstances, it seems to us that for the purposes of this appeal nothing turns on whether the evidence upon which his Honour relied in concluding that the subject of the patent had enjoyed ‘apparent commercial success’ was sufficient to sustain his Honour’s conclusion. His Honour, in our view, was alert to the limitations inherent in the evidence and his decision on the issue of obviousness was in no way dependent on that evidence.
178 Fresenius argued that the difference between the systems claimed by claims 1 and 2 of the patent and the prior art is ‘so marginal as to be incapable of being an inventive step’. In our view, the above argument tends to disguise the question to be answered. Concentration on the difference between a source of bicarbonate concentrate solution and a vessel containing bicarbonate in powder form to which water is added distracts attention from the combination of the integers of the invention. They are combined in a way which allows the combination to be used as a system for preparing a dialysis or replacement fluid or a compound fluid thereof. It is that combination of the integers upon which Gambro particularly relies as involving an inventive step.
179 Fresenius has not shown that his Honour was in error as to the tests to be applied or in his Honour’s reasons for his evaluation of the evidence. We agree with the primary judge that Fresenius did not satisfy the onus of establishing the case of obviousness so far as claims 1 and 2 are concerned. It was not demonstrated at first instance that the particular combination of the various integers, as claimed in the system claims, did not involve an inventive step. No error attends his Honour’s conclusion in this regard.
180 For the above reasons the appeal on this issue in respect of claims 4 and 11 (when dependent on claim 2) also fail.
The Second and Third Decision
181 Each of these decisions is based on the finding that the biBag infringes the patent. Accordingly, we do not see a need to consider those decisions further.
ORDERS
182 The parties should have the opportunity to consider the orders appropriate to give effect to these reasons, including orders as to costs.
183 The Court orders that:
1. The proceedings be stood over to 8 November 2005 at 9.30am for the purpose of making of orders giving effect to these reasons, including orders as to costs.
2. The parties provide to the Associate of Bennett J, by 8 November 2005, an agreed minute of the orders to be made (including the orders to be made as to costs) and if agreement has not by then been reached, the minutes of orders for which they will respectively contend and brief outlines of submissions in support of the orders.
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I certify that the preceding one hundred and eighty-three (183) numbered
paragraphs are a true copy of the Reasons for Judgment herein
of the Honourable
Justices Wilcox, Branson and Bennett.
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Associate:
Dated: 21 October 2005
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Counsel for the Appellant:
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A Archibald QC with S G C Burley
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Solicitor for the Appellant:
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Allens Arthur Robinson
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Counsel for the First and Second Respondent:
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D K Catterns QC with K J Howard
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Solicitor for the First and Second Respondent:
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Blake Dawson Waldron
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Date of Hearing:
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21, 22 and 23 February 2005
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Date of Judgment:
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21 October 2005
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URL: http://www.austlii.edu.au/au/cases/cth/FCAFC/2005/220.html