Polwood Pty Ltd v Foxworth Pty Ltd (includes corrigendum dated 5 March 2008) [2008] FCAFC 9 (18 February 2008)

POLWOOD PTY LTD (ACN 010 708 146), LEA CHARLES RAMPTON, MARGUERITE FRANCOISE RAMPTON AND POLWOOD AUSSIE BARK PTY LTD (ACN 068 346 529) v FOXWORTH PTY LTD (ACN 010 516 855), AUSSIE PEAT PTY LTD (ACN 085 498 933), PEACHESTER THOROUGHBREDS PTY LTD (ACN 069 059 294) AND PAUL DAVID POWER
QUD 321 OF 2006

FINN, BENNETT AND GREENWOOD JJ
18 FEBRUARY 2008 (CORRIGENDUM 5 MARCH 2008)
BRISBANE

BETWEEN:	POLWOOD PTY LTD (ACN 010 708 146) First Appellant/First Defendant LEA CHARLES RAMPTON Second Appellant/Second Defendant MARGUERITE FRANCOISE RAMPTON Third Appellant/Third Defendant POLWOOD AUSSIE BARK PTY LTD (ACN 068 346 529) Fourth Appellant/Fourth Defendant
AND:	FOXWORTH PTY LTD (ACN 010 516 855) First Respondent/First Plaintiff AUSSIE PEAT PTY LTD (ACN 085 498 933) Second Respondent/Second Plaintiff PEACHESTER THOROUGHBREDS PTY LTD (ACN 069 059 294) Third Respondent/Third Plaintiff PAUL DAVID POWER Fourth Respondent/Fourth Plaintiff
JUDGES:	FINN, BENNETT AND GREENWOOD JJ
DATE:	18 FEBRUARY 2008
PLACE:	BRISBANE

Counsel for the Appellants:	Mr M P Amerena

Solicitor for the Appellants:	Deacons

Counsel for the Respondents:	Mr A Crowe SC, Mr A Musgrave

Solicitor for the Respondents:	Hawthorn Cuppaidge & Badgery

Date of Hearing:	19 February 2008, 20 February 2008

Date of Judgment:	18 February 2008

Counsel for the Appellants:	Mr M P Amerena

Solicitor for the Appellants:	Mr I Hughes and Mr S Williamson, Deacons

Counsel for the Respondents:	Mr A Crowe SC, Mr A Musgrave

Solicitor for the Respondents:	Mr S Eleftheriou, Hawthorn Cuppaidge & Badgery, Lawyers

Date of Hearing:	19 February 2007, 20 February 2007

Date of Judgment:	18 February 2008

I certify that the preceding one (1) paragraph is a true copy of the Corrigendum to the Reasons for Judgment of the Honourable Justices Finn, Bennett and Greenwood

INTELLECTUAL PROPERTY - PATENTS – inventorship – at trial two parties claimed sole entitlement to grant of patent – primary judge found joint inventorship – appellant entitled to claims to method and process of invention and respondent entitled to claims to enabling apparatus – primary judge granted liberty to apply to permit joint inventorship to be determined on claim by claim basis – appellant continues to claim sole entitlement – respondent now argues for joint inventorship – appellant claims inventorship in totality of ‘inventive concept’ in invention – appellant claims contribution of respondent non-inventive, to do with physical working of concept – respondent claims two ‘inventive hearts’ in application with respondent inventor of one ‘heart’ being apparatus – both parties were jointly responsible for devising the inventive concept of the patent – respondent did not merely provide skill to implement appellant’s concept but contributed inventive skill to invention – claims not considered by primary judge to determine the extent or existence of joint inventorship of subject matter of individual claims

EQUITY - breach of confidence - confidential information largely conceptual in nature - authorised use involving time energy and inventive skill to produce an ‘invention’ - assertion by confidant of joint inventorship - proprietary relief in respect of confidant’s interest in the invention refused

INTELLECTUAL PROPERTY - COPYRIGHT – consideration of a claim of indirect infringement of copyright by making a version in three dimensions of an apparatus said to be a copy of an earlier apparatus embodying all of the features of a two-dimensional drawing – consideration of whether the contended copy is a three-dimensional version of the two-dimensional drawings in suit – consideration of the extent of any similarities between the features embodied in the three-dimensional apparatus and those features reflected in the drawings and the intermediate or earlier apparatus said to have been copied – consideration of the evidence going to conscious copying and substantial similarity

Patents Act (1990) (Cth), s 13, s 15(1), s 16, s 17
Copyright Act (1968) (Cth)

Foxworth Pty Ltd v Polwood Pty Ltd [2006] QSC 185, quoted
University of British Columbia v Conor Medystems Inc [2006] FCAFC 154; (2006) 155 FCR 391, cited and quoted
IDA Ltd v The University of Southampton [2006] EWCA Civ 145, cited
Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty Ltd [2001] HCA 8; (2001) 207 CLR 1, cited and quoted
Burroughs Wellcome Co v Barr Laboratories Inc [1994] USCAFED 1225; 40 F.3d 1223, cited
Stack v Davies Shephard Pty Ltd [2001] FCA 501; (2001) 108 FCR 422, cited
Aktiebolaget Hassle v Alphapharm Pty Ltd [2002] HCA 59; (2002) 212 CLR 411, cited
Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) [2007] HCA 21; (2007) 235 ALR 202, cited
Stanelco Fibreoptics Ltd’s Applications [2005] RPC 15, cited and quoted
Markem Corp v Zipher Ltd (No 1) [2004] RPC 10, cited and quoted
Markem Corp v Zipher Ltd [2005] All ER (D) 377, cited and quoted
Yeda Research and Development Co Ltd v Rhone-Poulenc Rorer International Holdings Inc [2007] UKHL 43; (2008) 1 All ER 425, cited and quoted
Henry Brothers (Magherafelt) Ltd v Ministry of Defence and the Northern Ireland Office [1997] RPC 693, cited and quoted
Norris’s Patent [1988] RPC 8, cited
University of Southampton’s Applications [2004] EWHC 2107; [2005] RPC 11, cited
Synthon BV v SmithKline Beecham [2005] 235 All ER (D), cited
Gunter v Stream 573 F.2d 77 (1978), cited
Mergenthaler v Scudder 11 App. DC 264 (1897), cited
Trovan Ltd v Sokymat SA [2002] USCAFED 164; 299 F.3d 1292 (2002), cited
Sewall v Walters [1994] USCAFED 426; 21 F.3d 411 (1994), cited
Mueller Brass Co v Reading Industries Inc 352 F. Supp. 1357 (1972), cited and quoted
Shum v Intel Corporation 499 F.3d 1272 (2007), cited and quoted
Ethicon v U.S. Surgical Corp [1998] USCAFED 46; 135 F.3d 1456 (1998), cited and quoted
Board of Education v American Bioscience Inc [2003] USCAFED 188; 333 F.3d 1330 (2003), cited
Stern v The Trustees of Columbia University, New York [2006] USCAFED 12; 434 F.3d 1375 (2006), cited
Hybritech Inc v Monoclonal Antibodies Inc 802 F.2d 1367 (1986), cited
Cook Biotech Inc v Acell Inc [2006] USCAFED 149; 460 F.3d 1365 (2006), cited and quoted
Eli Lilly & Co v Aradigm [2004] USCAFED 155; 376 F.3d 1352 (2004), cited
Finkelstein v Mardkha 518 F.Supp.2d 609 (2007), cited and quoted
Applied Elastomerics Inc v Z-Man Fishing Products Inc F.Supp.2d (25 September 2007), cited and quoted
Costa v G R and I E Daking Pty Ltd [1994] APO 23; (1994) 29 IPR 241, cited
Row Weeder Pty Ltd v Nielsen [1997] APO 38; (1997) 39 IPR 400, cited
JMVB Enterprises Pty Ltd v Camoflag Pty Ltd [2005] FCA 1474; (2005) 67 IPR 68, cited
Re Applications by CSIRO and Gilbert [1995] APO 16; (1995) 31 IPR 67, cited
Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2] [1984] HCA 73; (1984) 156 CLR 414, cited
Saltman Engineering Co Ltd v Campbell Engineering Co Ltd (1948) 65 RPC 203, cited
Interfirm Comparison (Australia) Pty Ltd v Law Society of New South Wales [1975] 2 NSWLR 104, cited
Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd [2001] HCA 63; (2001) 208 CLR 199, cited
LAC Minerals Ltd v International Corona Resources Ltd [1989] 2 SCR 574, cited
Ohio Oil Co v Sharp 135 F 2d 303 (1943), cited
S W Hart & Co Pty Ltd v Edwards Hot Water Systems [1985] HCA 59; (1995) 159 CLR 466, cited

Other materials
Meagher, Gummow & Lehane’s Equity: Doctrines and Remedies, 1141-1142 (4^th ed, 2002)

POLWOOD PTY LTD (ACN 010 708 146), LEA CHARLES RAMPTON, MARGUERITE FRANCOISE RAMPTON AND POLWOOD AUSSIE BARK PTY LTD (ACN 068 346 529) v FOXWORTH PTY LTD (ACN 010 516 855), AUSSIE PEAT PTY LTD (ACN 085 498 933), PEACHESTER THOROUGHBREDS PTY LTD (ACN 069 059 294) AND PAUL DAVID POWER
QUD 321 OF 2006

FINN, BENNETT AND GREENWOOD JJ
18 FEBRUARY 2008
BRISBANE

BETWEEN:	POLWOOD PTY LTD (ACN 010 708 146) First Appellant/First Defendant LEA CHARLES RAMPTON Second Appellant/Second Defendant MARGUERITE FRANCOISE RAMPTON Third Appellant/Third Defendant POLWOOD AUSSIE BARK PTY LTD (ACN 068 346 529) Fourth Appellant//Fourth Defendant
AND:	FOXWORTH PTY LTD (ACN 010 516 855) First Respondent/First Plaintiff AUSSIE PEAT PTY LTD (ACN 085 498 933) Second Respondent/Second Plaintiff PEACHESTER THOROUGHBREDS PTY LTD (ACN 069 059 294) Third Respondent/Third Plaintiff PAUL DAVID POWER Fourth Respondent/Fourth Plaintiff

1. The appellants shall within 14 days file and serve written submissions as to any Orders to be made in disposition of the appeal and cross-appeal and written submissions in relation to the costs of the appeal and cross-appeal together with any submissions as to the proposed Orders concerning the costs of the proceeding before the Supreme Court of Queensland, having regard to the reasons for judgment.

2. The respondents shall within a further 14 days of receipt of the appellants’ written submissions contemplated by Order 2 of these Orders, file and serve submissions in reply.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

BETWEEN:	POLWOOD PTY LTD (ACN 010 708 146) First Appellant/First Defendant LEA CHARLES RAMPTON Second Appellant/Second Defendant MARGUERITE FRANCOISE RAMPTON Third Appellant/Third Defendant POLWOOD AUSSIE BARK PTY LTD (ACN 068 346 529) Fourth Appellant/Fourth Defendant
AND:	FOXWORTH PTY LTD (ACN 010 516 855) First Respondent/First Plaintiff AUSSIE PEAT PTY LTD (ACN 085 498 933) Second Respondent/Second Plaintiff PEACHESTER THOROUGHBREDS PTY LTD (ACN 069 059 294) Third Respondent/Third Plaintiff PAUL DAVID POWER Fourth Respondent/Fourth Plaintiff

2 The first appellant (‘Polwood’) and the first respondent (‘Foxworth’), each claim entitlement to the grant of a patent on a patent application. The field of the invention as described in the patent application is a method and an apparatus for producing plant growth media (potting mix) using waste materials primarily of vegetable origin. The primary judge concluded that neither Polwood nor Foxworth was entitled to the grant of the patent as sole inventor but that they were joint inventors (Foxworth Pty Ltd v Polwood Pty Ltd [2006] QSC 185 at [262]). Polwood challenges that finding.

3 In order to understand the claims to inventorship, it is necessary to have some understanding of the subject of the relevant patents and their history. The invention the subject of the appeal originated in the ‘steaming tube dual auger concept’ (‘the concept’). Briefly, the concept involves a preferable method of producing plant growth media to increase their properties such as water retention. The concept involves transporting plant material (bark) through processing equipment (two augers) which leads to the plant material being submerged in treated water. The resulting plant growth medium is then 'de-watered' so that its moisture content is reduced. This subject matter was first discussed between and developed by Mr Rampton (‘Rampton’) and his neighbour Mr Connick (‘Connick’). We shall refer to their interests generally as those of Polwood (comprising the interests of all appellants and, in addition, the general position of Connick). Subsequently, in the context of a Deed of Licence (‘the licence’), the information regarding the concept was communicated to Mr Power (‘Power’) and Mr Kemp (‘Kemp’). We shall refer to their interests generally as those of Foxworth (comprising the interests of all of the respondents to the appeal). After the information regarding the concept was communicated to Foxworth, it commenced to develop the concept by building prototypes and ultimately an apparatus to implement the concept.

4 On 25 August 1989 Polwood obtained a patent in respect of a process developed by it for the production of orchid bark (‘the orchid bark patent’). In about 1993, Rampton reached the conclusion that the potential for sales and profit from the manufacture and sale of peat products exceeded that from the production and sale of orchid bark. Polwood filed a patent for the process for the production of peat products on 20 July 1994 (‘the peat patent’).

5 The publication date of the peat patent was 20 February 1995. The claims are to a method for the manufacture of a peat moss alternative. The named inventor was Rampton. The patent was part of the published prior art available to be read, as it was by Kemp.

6 The patent applications the subject of this appeal were filed on 22 July 2002 and 22 July 2003 respectively (relevantly a provisional patent application and an international application under the Patent Cooperation Treaty (‘PCT’), together ‘the patent application’).

7 The machines were built in three stages. Power and Kemp utilised the concept by building prototypes including a working prototype called the Mark II or PSU. The PSU/Mark II was built by Kemp and installed at Maryborough during the currency of the licence. Polwood says that it contributed instructions to Foxworth but accepts that Foxworth contributed independently to the design of the PSU/Mark II. After the licence expired, Rampton made extensive modifications to the PSU/Mark II, creating the ‘modified PSU’ or the ‘modified Mark II’. Polwood then filed the provisional patent application. After the patent application was filed, Rampton built an apparatus called the Mark III (also known as the ‘Replica PSU’ and ‘PSU Mark III’). The primary judge found that the Mark III was not merely a copy of the PSU/Mark II. The claims of the patent application encompass the Mark III and the PSU/Mark II machines.

8 Section 15(1) of the Patents Act 1990 (‘the Act’) provides that a patent for an invention may only be granted to a person who is the inventor. The Act defines ‘invention’ but not ‘inventor’. An invention means any manner of new manufacture the subject of letters patent and grant of privilege within section 6 of the Statute of Monopolies, and includes an alleged invention. The Act recognises that there can be two or more patentees, that is, two or more persons entitled to an equal undivided share in the patent (ss 16 and 17; see University of British Columbia v Conor Medystems Inc [2006] FCAFC 154; (2006) 155 FCR 391 per Emmett J at [8]–[19] for a discussion of the statutory scheme).

9 Before the primary judge, Foxworth asserted that it is the sole eligible person within the meaning of the Act entitled to registration as the owners of the patent application and sought orders and declarations that flow from that right. Polwood also asserted sole entitlement to registration as the owner of the patent application. Polwood denied that Foxworth made any material contribution to the invention. Polwood’s position was that Foxworth is not entitled to be the patentee, solely or jointly.

10 No party sought relief based upon joint inventorship. Each asserted sole rights. The case was presented to the primary judge on the basis that either one side or the other was the sole patentee. There was no contention of joint entitlement by reference to the subject matter of the different claims in the patent specification. The primary judge was inclined to a finding of joint inventorship and granted liberty to apply to permit joint inventorship to be determined on a claim by claim basis. His Honour did not consider the claims with a view to determine the extent or existence of joint inventorship of the subject matter of the individual claims. The liberty to apply has been exercised but the determination has not been made, pending this appeal. No submissions had been made to his Honour to address such a determination.

11 The primary judge at [257] concluded that the claims were of two broad types:

In the context of his Honour’s reasons, it would seem that he had in mind that there was joint inventorship with Polwood entitled to inventorship of the claims to the method and the process and Foxworth to the claims to the apparatus (at [258]–[259]).

12 Polwood complains about the finding that Foxworth not Polwood was the inventor of the apparatus. Polwood maintains the assertion that Rampton and Connick are the sole inventors and solely entitled to the patent application. Polwood contends that the single invention the subject of the patent claims is the concept. That concept, it is said, embraced method, apparatus and product claims. That is, Polwood contends that the apparatus claims do no more than reflect the ‘inventive concept’ of which Polwood was the author. However, Polwood does not suggest that it independently designed and/or built an apparatus with the characteristics of the apparatus subject of all of the claims in the patent application, specifically of claim 13. The primary judge referred at [217] to the use by Polwood of the ‘fruits of [Foxworth’s] labours’.

13 Polwood maintains its right to the relief sought at trial, namely a declaration of sole entitlement to the patent application. Polwood challenges the finding of the primary judge that there was joint inventorship when that issue was not canvassed at trial. It contends that his Honour made findings that were not framed by controversy.

14 Polwood says that it provided the ‘inventive concept’ in the idea of the steaming dual auger concept. Polwood relies upon Jacob LJ in IDA Ltd v The University of Southampton [2006] EWCA Civ 145 (2 March 2006) to reject the suggestion that inventorship is considered by reference to the claims, as the primary judge seems to have done. Lord Justice Jacob expressed the view at [43] that it was inappropriate to subdivide the inventive concept by reference to a myriad of claims. That is not to say, however, that the claims are irrelevant. The patentable invention of the patent application is as described and claimed (s 18(1) of the Act, Kimberly-Clark Australia Pty Ltd v Arico Trading International Pty Ltd [2001] HCA 8; (2001) 207 CLR 1 at [18]).

15 Foxworth, which pursued its claim to sole inventorship before the primary judge, now on appeal asserts joint inventorship. Borrowing from the terminology used in some United Kingdom cases, Foxworth says that there are two ‘inventive hearts’ of the patent application as reflected in the claims; one a process and one an apparatus. The issue in this aspect of the appeal is whether Foxworth is so entitled.

16 If contrary to Polwood’s primary submission, Foxworth is a joint inventor, Polwood asserts that Foxworth ought to be prevented from exercising its rights as joint inventor by operation of the springboard doctrine arising from the circumstances in which Kemp and Power obtained the information necessary for the invention of the PSU/Mark II. This will be discussed later in these reasons.

17 Polwood asserts that it was completely responsible for the concept that constituted the totality of the invention. It recognises that Foxworth first constructed the apparatus but contends that this was no more than an implementation of the completed and final Polwood concept. Polwood contends that the concept is the only ‘heart’ of the invention of the patent application. Polwood’s case is that Foxworth made no contribution to the invention and the contribution by Foxworth had no material or inventive effect on it. Rather, Polwood submits, Foxworth’s contribution was of the non-inventive kind to do with the physical working out of the concept, a means of construction (Burroughs Wellcome Co v Barr Laboratories Inc [1994] USCAFED 1225; 40 F.3d 1223 (1994)).

18 If Rampton for Polwood achieved the invention of the patent application without contribution by Kemp of Foxworth, the fact that Kemp achieved it independently would not deprive Polwood of the entitlement to the patent granted on the patent application as Polwood filed first in time. If there was a contribution by Foxworth to Polwood and that contribution was realised in the invention as described and claimed, Polwood is not solely entitled to the patent.

19 The primary judge did not regard Kemp’s evidence as reliable (at [105]). While Rampton’s evidence was considered generally more plausible, his Honour treated it with caution (at [106]). As to the apparatus described as claimed in the patent application, the primary judge’s findings, unchallenged on appeal include:

• Kemp’s initial task was to improve the process as well as the plant. This suggests that he would have been likely to get whatever advice and assistance he could from Rampton and Connick, at least in the early stages of his work (at [76]). Neither Kemp nor Power had any prior familiarity with the process (at [77]).

• Kemp and Power decided to build a machine and the way in which to do it (at [82]) after being told of the concept and its benefits. Neither Connick nor Rampton had any other material input beyond those specified at paragraphs [82]–[83] and at [191]–[192] namely, the concept of a steaming tube arrangement and the movement of materials in the tube, the benefits of the arrangement and information used for the purpose of design and construction such as the qualities of dolomite to be added and the temperature required. Neither Connick nor Rampton had any other material input into the engineering design of the PSU/Mark II. The design and the construction of the PSU/Mark II were based on the concept provided by Connick and Rampton but Kemp was responsible for the engineering design.

• Polwood was not the inventor of the apparatus. Polwood conceded that it did not make the apparatus, which was made by Foxworth in accordance with the inventive concept and advice given to Foxworth by Polwood (at [191]–[192]). It is doubtful that Polwood for itself would have acted on the concept (at [215]).

• The parties treated the information regarding the process, as well as the patent, as confidential. The significant part of the confidential information imparted to and used by Foxworth was ‘largely conceptual in nature’ (at [215]).

• Foxworth did act on the concept. In developing the apparatus the subject of the claims, Foxworth expended much time, energy and inventive skill (at [215]).

• Polwood did not copy the Foxworth apparatus. However, Polwood had the benefit of Foxworth’s endeavours and made a replica of the PSU/Mark II apparatus (at [242]).

• The claims include, in part, a description of the concept that originated by Polwood. But for the disclosure of the concept, Foxworth may not have devised a machine. The concept was ‘a key inventive step’ (at [258]). The apparatus the subject of some of the claims was not the subject of communication.

20 Thus, the key findings of fact made by the primary judge in the context of competing claims to sole inventorship are:

• Polwood was solely responsible for the concept, a key inventive step of the invention.

• Polwood made no material input into the engineering design or the construction of the PSU/Mark II.

• The design and construction of the PSU/Mark II by Foxworth were based on the concept.

• Aspects of the apparatus implemented information imparted by Polwood to Foxworth (at [258]) and aspects were not the subject of any such communication (at [259]).

• In acting on the concept and constructing the apparatus, Foxworth expended time, energy and inventive skill.

• Foxworth was ‘the inventor’ of aspects of the apparatus. Foxworth did not devise the inventive concept in a number of the claims (at [261]).

• Polwood did not devise the inventive concept in a number of the claims (at [261]).

21 The primary judge determined inventorship by reference to the ‘inventive concept’ of the patent application. In terms of the approach in the United Kingdom, his Honour’s conclusion is to the effect that the invention had two ‘hearts’. His Honour did not conclude from the evidence that Foxworth simply acted on Polwood’s instructions. His Honour did not conclude that Foxworth merely provided its skill to implement Polwood’s concept or that it carried out its work under Polwood’s instructions. The primary judge clearly found that Foxworth contributed to the inventive concept of the second ‘heart’ and not merely skill but ‘inventive skill’ (at [215]). His Honour held at [215] that the design and manufacture of the apparatus involved inventive merit. It was not a case of adding common general knowledge to Polwood’s inventive concept.

22 In order to avoid a finding of joint inventorship arising from those findings of fact, Polwood contends that the invention is solely in the concept. Polwood says that the apparatus claims did no more than put the concept into effect. That is directly contradicted by the findings of the primary judge.

23 Polwood submits that there was no evidence to support the finding at [215] of inventive skill by Foxworth. However, it is apparent from the chronology of events that it was only after its construction of the PSU/Mark II by Foxworth that Rampton created a replica PSU/Mark II with his own modifications. Each of the PSU/Mark II, the modified PSU and the Mark III are within the scope of the claims of the patent application.

24 The invention to be ascertained is as at the time of filing the application. It may be beneficial to examine any provisional specification to assess and understand the invention. Polwood filed the patent application. It was, it can be assumed in the absence of evidence to the contrary, drafted according to Polwood’s instructions and approved by Polwood.

25 The provisional specification on which the patent application was based was filed on 22 July 2002 and designates Polwood as the applicant. The provisional specification states that the invention is concerned particularly but not exclusively with the manufacture of plant growth media from sawmill waste, with or without other organic waste materials. Rampton acknowledged that it was Power who came up with the idea of using products other than peat bark. Polwood concedes that claim 2 of the patent application, to the extent that it extends beyond pine bark, was a Foxworth contribution.

26 The PCT patent application was filed on 22 July 2003. The named inventors were Rampton and Connick. It cites as prior art the orchid bark patent and the peat patent. The problem said to be addressed was:

27 The PCT patent application claims an apparatus for the continuous production of potting mix, comprising ‘a screw auger located in an inclined tubular body wherein the sawmill waste feedstock is submerged during travel from a lower end to an elevated dewatering end of said tubular body’. The claims are to a method for production of organic plant growth media from sawmill waste and to an apparatus for manufacture of organic plant growth media from sawmill waste. There are also product-by-process claims.

28 Polwood concedes that if it cannot set aside the finding that Foxworth’s contribution to the apparatus as claimed was inventive and a contribution to the ‘invention’, then Polwood cannot claim sole inventorship. In order to determine whether that applies, Polwood says that it is necessary to identify the final concept of the invention and to look at the quality of Foxworth’s contribution. It is necessary to discern the heart of the invention and it is to that that the rights attach by reference to the quality of the contributions to it. If the contribution by Foxworth is inventive in the sense of materially altering the final concept, or brings about an advantage which was not contemplated in the original invention, there is joint entitlement. There is no suggestion that the combination as claimed was other than inventive or that there are any inessential integers in the claims.

29 Polwood also urges the Court not to remit the case for a determination of whether there is joint inventorship but to make the necessary factual and analytical findings. The difficulty in this appeal is that the necessary findings of fact were not made, as the case was conducted somewhat differently before the primary judge. In response to that difficulty, Polwood contends that there is insufficient evidence to sustain a claim of joint inventorship. Polwood points to the only aspects on which Foxworth could rely as a contribution to the concept, the de-watering aspect of the concept and the addition of other vegetable matter in claim 2. The de-watering means of the apparatus are described in the provisional specification as comprising a region of tubular body having a plurality of apertures through which to drain water in use.

30 Foxworth says that the primary judge has made the relevant findings. His Honour recognised the need to determine the inventive concept, the inventive heart of the invention, and found two - in the method and in the broadest apparatus claim. Foxworth accepts that the concept was inventive and concedes that the apparatus was based on the Polwood concept but says that this was not sufficient to deny it joint entitlement. It was not sufficient, Foxworth says, to stipulate, as Polwood did as part of the concept, that a continuous process by which to produce bark and other products requires two tubes with augers in them joined at 90 degrees with heated water. Foxworth contends that the concept did not provide sufficient information for a skilled worker to build the apparatus without further inventive input.

31 Further, Foxworth says that the de-watering station located adjacent to the set outlet port as described in claim 13 is an essential integer of the claim and of the inventive concept. This was not specified by Polwood. It was arrived at by those who designed and built the PSU/Mark II, without any input from Rampton or Connick. It differed from any de-watering depicted in the peat patent. The de-watering in the peat patent was, Foxworth says, in the form of drying rather than the mechanical arrangement of the patent specification. Foxworth points to the fact that the inventive concepts in the PSU/Mark II were rectified in the provisional specification and in the claims of the patent application. These were filed before Polwood built the Mark III but while it had access to the PSU/Mark II. The primary judge found that Foxworth’s contribution was inventive.

32 Polwood contends that whether or not the contribution involved inventive skill there is a distinction between the inventor and someone who made a contribution to the invention where there was no material impact on the final inventive concept. It is not then relevant. It submits that it is necessary to see whether there was a material impact on the inventive concept and a result or advantage not contemplated, in contrast to a better way of physically implementing the invention.

33 Polwood submits that the primary judge erred in emphasising the conceptual nature of its contribution and points out that many complete inventions are conceptual and have not matured into a practical application. Polwood says that, in this case, the experimentation that gave rise to the three prototypes was to get a preferred working embodiment and not to research a problem with the concept itself.

Indications of joint inventorship in United Kingdom and United States authorities

34 The entitlement to the grant of a patent as the inventor is not determined by quantitative contribution. The role of joint inventors does not have to have been equal; it is qualitative rather than quantitative. It may involve joint contribution or independent contributions. The issue is whether the contribution was to the invention. What constitutes the invention can be determined from the particular patent specification which includes the claims. In some cases, evidence can assist. In some cases, the reduction of a concept to a working apparatus by a person may not be part of the invention, in other cases it may be. For example, the construction of an apparatus may involve no more than carrying out the instructions in the specification. This would not normally entitle that person to joint inventorship. On the other hand joint inventorship may arise where the invention is in the apparatus itself, or where the person constructing the apparatus contributed to a different or better working of it which is then described and claimed.

35 One criterion for inventorship may be to determine whether the person’s contribution had a material effect on the final invention. It may be that an invention is made as part of a collaborative effort. In those circumstances, it would ordinarily follow that the collaborators are joint inventors of the product of the collaboration. In the present case, the subject of the patent application was not part of a continuing collaboration recognised as such by the parties.

36 To ascertain the inventor for the purposes of entitlement to the grant of the patent it is therefore necessary to determine the contributions to the invention described in the patent application. The claims may assist in that determination, bearing in mind that the claims may be to less than the totality of the invention. It may also be appropriate to investigate the contributions to the inventive steps giving rise to the invention.

37 In the United States the principle has developed that a patent to a claimed invention that is the subject of contribution from more than one person cannot be granted to one only of the contributors. While care must be taken in applying United States law on inventorship where entitlement is determined on a ‘first to invent’ not on a ‘first to file’ basis, that principle is of general application. This was acknowledged in Stack v Davies Shephard Pty Ltd [2001] FCA 501; (2001) 108 FCR 422 (at [21]) and is consistent with s 15 of the Act. As was said in Chisum on Patents (1978) and adopted in Stack at [24], ‘if the invention was joint, the defendant’s patent in his sole name was invalid’. That led the Full Court in Stack to conclude at [28] that one person was not solely entitled to a patent for the joint invention of himself and another. It follows that, if Polwood and Foxworth are entitled to be recognised as joint inventors, Polwood is not entitled to registration of the patent in its sole name.

38 The Full Court in Stack discussed a number of ways in which the cases have explained the right of a person to claim to be the inventor entitled to the patent, including the contribution to the ‘conception of the solution’ to the problem (Chisum on Patents cited at [22]). However, the conception of the solution may not be sufficient to claim sole inventorship or correlate with the invention that is described and claimed. There may not have been a recognised problem to be addressed and not all inventions or inventive steps can be analysed in terms of problem/solution (Aktiebolaget Hassle v Alphapharm Pty Ltd [2002] HCA 59; (2002) 212 CLR 411; Lockwood Security Products Pty Ltd v Doric Products Pty Ltd (No 2) [2007] HCA 21; (2007) 235 ALR 202).

39 As discussed in Stack at [18], a person cannot base a claim to be the first and true inventor on knowledge derived from the inventor. On the assumption on which Polwood’s case is based, that the concept is the totality of the invention of the patent application, Polwood says that the invention was made by Rampton and then communicated to Kemp and Power. Polwood contends that, having learnt of the concept from Connick and Rampton, Foxworth did not contribute to the conception of the invention and is not entitled to it. On the evidence and findings of the primary judge, Foxworth would not be entitled to claim inventorship of the concept.

40 In Stanelco Fibreoptics Ltd’s Applications [2005] RPC 15 (at [15A]) Mr Floyd QC said that ‘a mechanistic, element by element approach to inventorship will not produce a fair result’. He was of the view (at [18]) that the basic enquiry is to determine the actual deviser(s) of the inventive concept. However, he linked that principle with what is put forward in the patent as inventive. He also agreed with Judge Fysh QC in Markem Corp v Zipher Ltd (No 1) [2004] RPC 10 at [66]–[71] where his Honour observed that the purveyor of a non-inventive contribution to a working combination may be a co-inventor and that the quality of the contribution and the impact on the result depends on the facts in each case. It is not necessarily the inventiveness of the contribution that is the determining factor. The important question is whether the second researcher can be said in substance to be jointly responsible for devising the inventive concept of the patent (Stanelco at [20]).

41 This principle was developed further in the United Kingdom in the appeal in Markem Corp v Zipher Ltd [2005] All ER (D) 377. Lord Justice Jacob, with whom Mummery and Kennedy LJJ agreed, rejected a claim by claim approach to the ascertainment of inventorship. His Lordship said at [102] that ‘what one is normally looking for is "the heart" of the invention. There may be more than one "heart" but each claim is not to be considered as a separate "heart" on its own’. Markem (CA) has been overruled by the House of Lords in Yeda Research and Development Co Ltd v Rhone-Poulenc Rorer International Holdings Inc [2007] UKHL 43; (2008) 1 All ER 425 but not on this point. As was stated by Lord Hoffman in Yeda Research at [19], in the context of the definition of inventor in the Patents Act 1977 (UK) as ‘the actual devisor of the invention’, the first step in a dispute over entitlement is to decide who was the inventor or inventors of the claimed invention. This requires a determination of the person who devised or contributed to the inventive concept. It is not enough that someone contributed to the claims, because they may include non-patentable integers derived from prior art (at [20]).

42 Polwood submits that the adoption by the primary judge of a claim by claim approach demonstrates that his Honour fell into error. Polwood submits that had the primary judge construed the claims as a whole, only one ‘heart’ of the invention would have been found. However, Foxworth points to the primary judge’s comments at [260] where his Honour noted that it was not possible to determine on a claim by claim basis who derived the inventive concept within the patent application because the approach of the parties at trial was on an all or nothing basis.

43 As to the apparent separation and characterisation of the claims by the primary judge, Foxworth emphasises the principle enunciated by Jacob J (as he then was) in Henry Brothers (Magherafelt) Ltd v Ministry of Defence and the Northern Ireland Office [1997] RPC 693 (at 706):

Foxworth submits that the combination of method and apparatus in the patent application cannot be said to have been developed by one side or the other. On this basis, the parties were joint inventors.

44 In IDA the Court of Appeal revisited the subject and repeated what had been said in Henry Brothers and Markem [2005]. There, the Court concluded at [31] that the fact the first person did not know whether or how his idea would work did not prevent him from being the sole devisor of the invention. Finding out whether or not it worked was, in that case, a matter of simple and routine experimentation or mere verification (at [32]). It ‘amounted to no more than adding the common general knowledge in the art’ (at [35]). Lord Justice Jacob, with whom Wilson and Ward LJJ agreed, observed at [37] that normally the addition of matter which is common general knowledge often forms the subject of subsidiary claims of no significance as regards inventorship and may go to ‘the generality of the main concept’. At [43] Jacob LJ warned against dividing the information into ‘a myriad of sub-concepts’, bearing in mind that a patent is only meant to have one inventive concept. These observations (at [38]) were clearly directed to a case where what was needed to get a patent was only the disclosure of an idea. In that case, disclosure of a means of enablement was not necessary and the skilled person could readily practice the invention. On the other hand, in Norris’s Patent [1988] RPC 8 Falconer J considered a patent with claims to the method of use and to the apparatus itself, which constituted two distinct but interrelated aspects of the invention.

45 As Laddie J had noted in University of Southampton’s Applications [2004] EWHC 2107; [2005] RPC 11 (at [46]) (cited with approval by Lord Hoffman in Synthon BV v SmithKline Beecham [2005] 235 All ER (D) at [28] and by Jacob LJ in IDA at [38]), devising an invention and providing enabling disclosure may both be necessary to secure valid patent protection but they relate to different aspects of patent law. This was elaborated by Jacob LJ in IDA at [39]:

46 This approach is similar in concept to that adopted in the United States. In Gunter v Stream 573 F.2d 77 (1978), in the context of interference proceedings, Baldwin J, citing Mergenthaler v Scudder 11 App. DC 264 (1897) described ‘conception’ of the invention as the complete performance of the mental part of the inventive act; the formation in the mind of the inventor of a definite and permanent idea of the complete and operative invention, as it is thereafter to be applied in practice. The mental part of the inventive act is then complete. What remains belongs to the department of construction, not invention (at 80). While conception can be complete although experimentation may continue, conception is complete when one of ordinary skill in the art could construct the apparatus without unduly extensive research or experimentation (Trovan Ltd v Sokymat SA [2002] USCAFED 164; 299 F.3d 1292 (2002), Sewall v Walters [1994] USCAFED 426; 21 F.3d 411 (1994) at 416; Burroughs Wellcome at [5,6]). As was observed in Burroughs Wellcome, conception is complete when the inventor has some particular solution to the problem at hand, the operative invention, although it is not necessary to know that the invention will work (at [7,8]). A distinction can be drawn where the first person would have been able to give effect to the idea but utilised the expertise of another to put the effect into practice, under instruction (Mueller Brass Co v Reading Industries Inc 352 F. Supp. 1357 (1972) at [16,17]). However, general goals or a research plan to be pursued are not sufficient. In Mueller inventorship was regarded as a role in the final conception of that which is sought to be patented. It is clear that, in working out the inventive concept in a patent, each patent will be different and it will be necessary to ascertain the inventive concept from the whole of the specification. Contribution after the invention was fully conceived where that contribution was under the direction of the inventor does not give rise to entitlement to the invention. A person must be able to say that without his or her contribution to the final conception it would have been less (Mueller at [16,17]). As Newcomer J observed at [16,17] ‘the exact parameters of what constitutes joint inventorship are quite difficult to define. It is one of the muddiest concepts in the muddy metaphysics of the patent law’. While the law regarding inventors may be affected by the ‘first to invent’ aspects of the patent law of the United States, the philosophy is apt.

47 More recent United States authority has approached the question of conception more by reference to the claims.

48 In Shum v Intel Corporation 499 F.3d 1272 (2007) (at [6]) Lourie J with whom Newman J agreed, cited with approval the case of Ethicon v U.S. Surgical Corp [1998] USCAFED 46; 135 F.3d 1456 (1998) where Rader J stated ‘the critical question for joint conception is who conceived, as that term is used in the patent law, the subject matter of the claims at issue’ (at 1460). In Ethicon (at [5-7]) Rader J held that:

...for the conception of a joint invention, each of the joint inventors need not "make the same type or amount of contribution" to the invention. Rather, each needs to perform only a part of the task which produces the invention. On the other hand, one does not qualify as a joint inventor by merely assisting the actual inventor after conception of the claimed invention...Moreover, depending on the scope of a patent’s claims, one of ordinary skill in the art who simply reduced the inventor’s idea to practice is not necessarily a joint inventor, even if the specification discloses that embodiment to satisfy the best mode requirement.

49 For joint inventorship, each inventor must generally contribute to the conception of the invention (Shum at [6] citing Board of Education v American Bioscience Inc [2003] USCAFED 188; 333 F.3d 1330 (2003) at 1337-38). This conception is the ‘formation in the mind of the inventor, of a definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice’ (Shum at [6] and Stern v The Trustees of Columbia University, New York [2006] USCAFED 12; 434 F.3d 1375 (2006) at [2-5] citing Hybritech Inc v Monoclonal Antibodies Inc 802 F.2d 1367 (1986) at 1376).

50 In Stern a former medical student sought to be added as co-inventor of a patent. The student had merely carried out an experiment previously done by the other claimed inventor on different animals than those used by the other inventor. The other inventor had already determined that those animals would be good models for research. Mayer J held that the student’s contribution was ‘insufficient to support a claim of co-inventorship’ (at [6]). At [2-5] his Honour noted that because ‘[c]onception is the touchstone of inventorship’ (citing Burroughs Wellcome at 1227), each joint inventor must generally contribute to the conception of the invention. Further, contribution to one claim is sufficient to be found to be a co-inventor (citing Ethicon). In Cook Biotech Inc v Acell Inc [2006] USCAFED 149; 460 F.3d 1365 (2006) Prost J held (at [11]) that ‘‘[T]o be a joint inventor, an individual must make a contribution to the conception of the claimed invention that is not insignificant in quality’ and the inventors must ‘have some open line of communication during or in temporal proximity to their inventive efforts’’ (citing Eli Lilly & Co v Aradigm [2004] USCAFED 155; 376 F.3d 1352 (2004) at 1358-1359).

51 In Finkelstein v Mardkha 518 F.Supp.2d 609 (2007) Holwell J (at [6]) referred to Burroughs Wellcome and noted that conception will not yet be complete where extensive research and experimentation is still required to reduce an invention to practice. Justice Holwell stated that, ‘while research and experimentation, especially if extensive, may be sufficient to render one a co-inventor, exercising ordinary skill in the art, even if extensive, is not’ (quoting Sewall at 416). The proper inquiry ‘concerns the quality, not the quantity of the contribution’.

52 In Applied Elastomerics Inc v Z-Man Fishing Products Inc F.Supp.2d (25 September 2007) Wilkin J applied Ethicon to the extent that a co-inventor need not make a contribution to every claim of the patent (at [5-8], citing Ethicon at 1461). However, Wilkin J noted that the co-inventor must perform at least ‘‘a part of the task which produces the invention’ and must have ‘conceived, as that term is used in the patent law, the subject matter of the claims at issue’’ (citing Ethicon at 1460-1461).

53 There has been some consideration of the principles of joint inventorship in Australia. In Costa v G R and I E Daking Pty Ltd [1994] APO 23; (1994) 29 IPR 241 and Row Weeder Pty Ltd v Nielsen [1997] APO 38; (1997) 39 IPR 400 joint inventorship was found where one person had a general idea of what was required in a machine but did not necessarily know how to put those ideas into effect and the other person did so. In Costa the Delegate of the Commissioner of Patents said that in his view, the question was whether the invention would have occurred without the second person’s involvement (at 246). In Row Weeder joint inventorship was said to arise where one person has a general idea for solving a problem but is unable to give effect to the idea while another person is able to do so. The Delegate of the Commissioner of Patents concluded in Row Weeder (at 405) that a person has entitlement to an invention if that person’s contribution, either solely or jointly with others had a material effect on the final concept of the invention. Whether or not that contribution involved a key inventive step was said to be secondary. Entitlement to joint inventorship does not apply to a person who, not being the true inventor, bases the claim on knowledge derived from that inventor (Stack at [18]).

54 In JMVB Enterprises Pty Ltd v Camoflag Pty Ltd [2005] FCA 1474; (2005) 67 IPR 68 Crennan J said at [132] that rights in an invention are determined by objectively assessing contributions to the invention rather than assessing the inventiveness of respective contributions. The invention is to be looked at as a whole, as well as the component parts. The relationship between the participants, such as a collaboration (citing Re Applications by CSIRO and Gilbert [1995] APO 16; (1995) 31 IPR 67 at 72–73) is a relevant factor. Her Honour put it on the basis that, if the final concept of the invention would not have come about without a particular person’s involvement, then that person has entitlement to the invention (at [132]).

55 There is a difference between a failure to include as the person to whom the patent is granted a person who contributed to the invention and the inclusion of persons who did not, in fact, make any contribution (University of British Columbia at [42]–[44] per Emmett J). Each patent applicant must be a ‘person’ for the purposes of s 15(1) of the Act. Unless a person is as mentioned in s 15(1), that person has no entitlement to the patent (University of British Columbia at [42]–[44] per Emmett J, [62] per Stone J).

56 The primary judge did not directly consider whether the concept was sufficient to enable the apparatus as described and claimed to be designed and built by the application of common general knowledge or ordinary skill. That was not an issue before his Honour. This gives rise to some difficulties with the matters presented to this Court.

57 A number of factual matters have been raised in the appeal which were not resolved at trial. One is Foxworth’s contention that it contributed the ‘de-watering’ integer of claim 1. Polwood asserts that the de-watering was necessarily a part of the process of the peat patent and was always part of the Polwood process and had been put into practice, albeit in a cruder form. The primary judge made no specific finding and did not discuss the source of the idea of partial de-watering.

58 It is not in dispute that Foxworth introduced the idea that materials other than pine bark could be used as raw material, that is that the concept could be extended to other products, as claimed in claim 2. It is not in dispute that there were no direct findings of fact in this regard. There is no basis to assess Polwood’s assertion that the method of claim 2 simply followed the inventive method of claim 1 and the contribution was not sufficient to justify joint inventorship. Similarly, there is no evidence or factual finding to test Polwood’s assertion that additions that were not the subject of its contribution were mere workshop variations, despite its concession that part of the invention was the way the apparatus was constructed.

59 Polwood contends that the primary judge found that it was the originator of a key inventive concept and that no other inventive concept was identified by his Honour. Polwood says that the apparatus comes within the concept communicated by Polwood to Foxworth. The information so imparted included the timing of the process and the temperatures used in it. The primary judge accepted (at [192]) that Rampton told Kemp and Power that they would have to achieve between 80 degrees and 110 degrees and that it should not go above 100 degrees or desirable pathogens would be killed. It was also part of the background of the invention of the published peat patent that bark granules are preferably heated at a temperature in the range of 95 to 105 degrees.

60 However, while the primary judge was not asked to and did not make the specific findings, his Honour found that Foxworth contributed inventive skill in its design and construction of the PSU/Mark II (at [215]). That apparatus was as described and claimed in the patent application. His Honour also found that Foxworth was ‘the inventor’ of the apparatus (at [259]). Those conclusions suggest that his Honour’s view was that Foxworth made a material, inventive contribution to the inventive concept of the patent application. His Honour found that the Polwood concept was an inventive concept. He did not say that it was the inventive concept.

61 The invention or inventive concept of a patent or patent application should be discerned from the specification, the whole of the specification including the claims. The body of the specification describes the invention and should explain the inventive concepts involved. While the claims may claim less than the whole of the invention, they represent the patentee's description of the invention sought to be protected and for which the monopoly is claimed. The claims assist in understanding the invention and the inventive concept or concepts that gave rise to it. There may be only one invention but it may be the subject of more than one inventive concept or inventive contribution. The invention may consist of a combination of elements. It may be that different persons contributed to that combination.

62 In this case, the body of the specification and the claims describe two aspects of the invention, the concept and the apparatus to give effect to it. Both are described and claimed by Polwood as the patent applicant as inventive.

63 Foxworth does not support the suggestion by the primary judge that the parties approach the question of inventorship on a claim by claim basis. Recognising that a specification may relate to only one invention (s 40(4) of the Act), Foxworth submits that the primary judge found that the only contribution of the Polwood interests was the broad concept which Foxworth applied and utilised to build the apparatus. Foxworth relies on inferences from his Honour’s reasons to submit that his Honour was satisfied that the apparatus claims came from the work and inventiveness of Kemp and Power and not from the application of mere workshop variations.

64 Foxworth also says that the evidence supports the conclusion that the teaching in the patent specification about the practical application of the concept to the apparatus was taken by Rampton from the PSU/Mark II built by Kemp and Power. That is, the apparatus claims would not have been possible without that input. The consequence, it submits, is joint inventorship.

65 The primary judge concluded that Foxworth was ‘the inventor’ of the apparatus (at [259]). His Honour apparently formed that view on the basis of inventorship being divided based on the subject matter of individual claims (at [257]). His Honour concluded that neither Polwood nor Foxworth were entitled to the grant of the patent as sole inventor (at 262] cf [243], [245]). His Honour did not directly consider whether the contribution by Foxworth constituted a separate ‘heart’ of the invention or whether the concept gave sufficient information and instruction to enable the apparatus described and claimed in the patent application to be constructed with the application of ordinary skill or the application of common general knowledge.

66 However, the patent application described the apparatus as an aspect of the invention. The apparatus was described and claimed. Polwood did not itself play any part in its design and construction prior to the filing of the patent application. The apparatus was found to be ‘an invention’ of Foxworth. There was a finding of inventive contribution by Foxworth. There was no evidence that the concept was itself sufficient to encompass the machine that made it workable.

67 These factors argue against Polwood’s contention that the concept equated with the invention of the patent application. We are not satisfied that Foxworth’s contribution was insufficient to entitle it to joint inventorship. That is, we are not satisfied that Polwood is solely entitled to the grant of the patent and that his Honour erred in concluding that Foxworth was a joint inventor. Polwood and Foxworth as joint inventors are entitled to the grant of the patent and entitled to an equal undivided share in the patent (s 15 and s 16 of the Patents Act). It is neither appropriate nor necessary to refer the matter back to the primary judge to conduct a review of inventorship on a claim by claim basis.

69 If the appellants’ Third Further Amended Defence and Counterclaim pleaded an action for breach of confidence, it did so quite obscurely: see para 56 of the Second Further Amended Statement of Claim and paras 12V-12Y and 15 of the defence upon which the appellants rely. We would observe in passing that the pleading blends, unhelpfully, claims for breach of fiduciary duty, assignment, and seemingly, allegations of breach of trust and claims under the Barnes v Addy doctrine. It is nonetheless clear that the trial proceeded on the basis that a breach of confidence claim was being made in order to found proprietary and injunctive relief against the Foxworth interests. As best we can discern it, the Polwood interests’ claim was to the sole beneficial ownership of the ‘invention’.

70 The primary judge found that Foxworth had committed an actionable breach of confidence in making unauthorised use after the termination of the licence and for its own purposes, of confidential information disclosed to Power and Kemp by Rampton and Connick during the course of the licence. Nonetheless, his Honour refused to grant relief in respect of that wrong. To understand the basis of that decision it is necessary to refer to the Deed of Licence and to his Honour’s treatment of several provisions in it. First, while the deed envisaged the possibility that Foxworth might develop new processes or product arising out of the operation of the business, it did not oblige Foxworth to conduct research and development, let alone for Polwood’s benefit. Clause 4.3 made provision for the joint ownership of such new processes, etc in the event that Foxworth exercised its option under the deed to take an 85 per cent interest in the assets of Polwood’s peat processing business. His Honour appears to have regarded this provision as dealing only with entitlements to rights to property as such: at [109]. The clause in any event was inapplicable in the circumstances as Foxworth did not take the 85 per cent interest. Further and in a passage the significance of which is difficult to determine, his Honour appears (at [110]) to have implied a term to the effect that property rights the subject of cl 4.3 would not be disposed of by Polwood and acquired by Foxworth if the exercise of the option did not result in the assignment of an 85 per cent interest.

71 What requires notice for present purposes is that his Honour clearly did not regard cl 4.3 or that implied term as having any bearing on the question of entitlements to, or interests in, the invention the subject of the patent application. Of greater significance, his Honour refused to imply a term in the deed to the effect that if the option was not exercised or if the contract to purchase was wrongfully repudiated, Foxworth’s interests under the deed and in any improvements to the business premises or any development of any process or product arising out of Foxworth’s operation of the peat business would remain in, or vest in, Polwood: see [111]-[116]. The trial judge noted that such a claim of entitlement to the product of Foxworth’s endeavours was quite different from a claim that an obligation of confidence attached to information provided by Polwood to Foxworth. The Deed did address confidentiality in a number of clauses. The matter to be emphasised in this is that, on his Honour’s construction of the contract, no presently relevant provision gave Polwood any contractual entitlement to the product of Foxworth’s endeavours as represented in the development of the PSU. No appeal has been made against any of the trial judge’s contractual conclusions. It is unnecessary for us to consider the correctness or otherwise of them.

72 Secondly, while the deed (at cl 7.1) made express provision proscribing the unauthorised disclosure or transfer of trade secrets and other confidential information, it did not refer to unauthorised use of such secrets and information. The complaint against Foxworth being for unauthorised use, it was for this reason that the Polwood’s claim had to be founded on the equitable doctrine of breach of confidence.

73 The primary judge dealt at some length in his reasons with the communications made by Rampton and Connick to Power and Kemp in relation to the design of the PSU: see [44]-[83]. His Honour concluded that confidential information was disclosed in the course of them; that information ‘set Foxworth on the course of improving the process and the plant used in the peat business, which led to the construction of the PSU’; and that ‘[b]oth parties, for good reason, regard the intellectual property rights in respect of the PSU to be extremely valuable’: [186].

74 The confidential information found to have been communicated comprised (i) a particular concept of a steaming tube; (ii) information that that concept provided a preferable method of producing peat products and had specified advantages over the existing method used; and (iii) the timing of the process and the temperatures used in the process: [191]-[192]. The more significant part of this information was described as being ‘largely conceptual in nature’: at [215].

75 On the appeal, Foxworth initially challenged the primary judge’s finding that the information was confidential. Ultimately, it conceded, ‘quite properly’, that confidential information was communicated.

76 Having regard to the context in which the information was communicated and to the nature of the business relationship between the parties, the primary judge concluded, unexceptionably in our view, that the circumstances were ones which imported a duty that precluded Foxworth from using or imparting confidential information obtained from Polwood in the course of the peat business, except for the purposes of the peat business, during the term of the licence unless Foxworth exercised the option and acquired an 85 per cent interest in that business. We would only note in passing that we do not consider that case law on who is a fiduciary for conflict of duty and interest purposes to which his Honour referred: cf Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2] [1984] HCA 73; (1984) 156 CLR 414 at 436; provides assistance in determining whether, in circumstances such as the present, confidential information has been communicated in circumstances importing a duty of confidence: see e.g. Saltman Engineering Co Ltd v Campbell Engineering Co Ltd (1948) 65 RPC 203 at 213; Interfirm Comparison (Australia) Pty Ltd v Law Society of New South Wales [1975] 2 NSWLR 104 at 117; Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2], at 437.

77 The breach of confidence found was that there was an unauthorised use of the confidential information when Foxworth sought to use it for its own purposes after the term of the licence expired. It appears to be implicit in this finding that the ‘confidential information’ was unauthorisedly used in several business ventures in which the respondents were involved after the expiry of the licence. We will return to this matter below. There was evidence before his Honour of such ventures though Polwood did not claim relief in respect of them as such.

78 On the issue of appropriate relief, his Honour noted that the principal relief sought was directed at the claim made by the Foxworth interests that Peachester Thoroughbreds Pty Ltd and Power were the only eligible persons entitled to apply for registration of a patent in respect of the invention the subject of the patent applications. Though Polwood sought a declaration that Peachester Thoroughbreds and Power were not such eligible persons, the basis of that declaration was, seemingly, the proposition that in consequence of Foxworth’s breach of confidence, the advantage Peachester Thoroughbreds and Power derived – i.e. the invention – was held by them on a constructive trust for the sole use and benefit of Polwood Pty Ltd.

79 The trial judge acknowledged there was authority supporting the imposition of a constructive trust in breach of confidence cases. However, his Honour was of the view that, even ‘assuming the availability of the remedy, I do not regard it as appropriate here’. The apparent reasons for this would seem to be related to the ‘conceptual nature’ of the confidential information itself, to the time, energy and inventive skill expended by Foxworth on it and in developing the PSU and to the benefit Polwood had had of Foxworth’s endeavours at [215].

81 We would note immediately that it is conceded that his Honour was in error in observing that ‘both sides’ had made patent applications. The Foxworth interests had not. We would also note that the appellants’ formal ground of appeal for present purposes, impugns the manner of application of ‘the springboard doctrine’.

82 The appellants frankly concede that with the primary judge’s finding of ‘joint inventorship’, the breach of confidence claim necessarily now has a different focus, albeit the essence of the claim for relief is the same save that it is directed, not at the Foxworth assertion of inventorship, but to the lesser assertion of joint inventorship. They contend that having correctly found a breach of confidence, the primary judge erroneously invoked the springboard doctrine which was designed to preclude a party from obtaining a head start in the exploitation of information that party acquired in confidence but which has later passed into the public domain. Rather, it is said, his Honour should have focussed upon the question whether, in the circumstances, it would be unconscionable for the Foxworth interests to assert their interest in the invention. This, it is said, was their ‘illicit gain’.

83 The respondents contend that this different and new claim ought not be permitted on the appeal. More significantly, they ask the court to unpackage the alleged breach of confidence so as to demonstrate why relief should be denied in any event. Put shortly, they submit that they lawfully used the confidential information to develop the PSU with Polwood’s encouragement and consent. There was no breach of confidence in their so doing but by doing so they became as a matter of law under the Patents Act entitled, on a joint application, to be a joint patentee of the invention. There is not, as yet, such an application – hence, it is contended, there is not a subject matter in respect of which equitable relief could be granted (assuming it was appropriate), though Foxworth has undertaken to participate in the making of a joint application. Further, while his Honour found that an unauthorised use was made of the confidential information after the expiry of the licence, no relief, whether for gains improperly made or for losses suffered, was made in respect of that unauthorised use. At best, it is said Polwood’s contention is that, in asserting joint inventorship, Foxworth is making a continuing, albeit indirect, unauthorised use of the confidential information whereas all it is doing is no more than protecting an entitlement given by the Patents Act.

84 The appellants’ response to the contention that, absent a joint application for a patent, there is no right capable of being the subject matter of a constructive trust, is to assert that the invention itself has sufficient characteristics of property for Patent Act purposes to provide that subject matter. Reliance here is placed upon a guarded dictum of Emmett J in University of British Columbia v Conor Medsystems Inc [2006] FCAFC 154; (2006) 155 FCR 391 at [38] that an invention itself may be a species of property capable of assignment, alienation or disposition.

85 The stark facts about which there can be no controversy are that when Power and Kemp designed and constructed the PSU they utilised the confidential information with the consent of Polwood; they then committed no breach of confidence; and through the application of ‘much time, energy and inventive skill’ (at [215]), they developed the PSU and in so doing, as his Honour found, made an inventive contribution to an aspect of the invention (i.e. the apparatus).

86 As earlier indicated, no contractual claim is live in the appeal which could result in Polwood being able to assert as a matter of contractual right that, as between it and Foxworth, the invention ‘belonged’ solely to it in the sense that it alone was entitled to exploit it on the expiry of the licence. As we earlier indicated, it is unnecessary for us to consider his Honour’s construction of cl 4.3 of the deed and his refusal to imply a term to the effect that, in the event of the option not being exercised or, if exercised, of the contract being wrongfully repudiated, Foxworth’s right title and interest (inter alia) in any improvements to the existing premises or any development of any process or product arising out of the operation of the business by it remain in, or vest in, Polwood.

87 Any claim that Polwood may make to the advantage derived by Foxworth from being a joint inventor must arise, if at all in equity. It is again unnecessary to deal with pleaded but not prosecuted claims based on fiduciary obligations and assignment. The confidential information claim alone carries the burden of Polwood’s hopes.

88 Though the pleadings and aspects of Polwood’s submissions could be taken as suggesting that Polwood was relying at large – and impermissibly: see Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd [2001] HCA 63; (2001) 208 CLR 199 at [98] ff – on the notion of unconscionable behaviour to prevent Foxworth asserting its rights as joint inventor, it has resiled from this and has tied the claim to breach of confidence. Foxworth’s alleged wrong is its use of the confidential information in asserting that it is a joint inventor. The relief sought is that Foxworth holds its rights on trust for the sole use and benefit of the appellants. The essence of the grievance Polwood had would seem to be that while Foxworth may have contributed to the invention – ‘1 per cent, or 5 per cent, or 10 per cent’ – as joint inventor it would be entitled under s 16(1)(a) and (b) of the Patents Act to an equal undivided share in the patent when granted and to exercise the exclusive rights for its own benefit without accounting to the other co-owner, Polwood.

89 This is not an appropriate case in which to enter in any detail upon the question when a constructive trust may appropriately be imposed upon a proprietary advantage obtained in consequence of a breach of confidence: but see LAC Minerals Ltd v International Corona Resources Ltd [1989] 2 SCR 574; Ohio Oil Co v Sharp 135 F 2d 303 (1943); Meagher, Gummow & Lehane’s Equity: Doctrines and Remedies, 1141-1142 (4^th ed, 2002). The archetypal case, we would note though, has been one where the confidential information related to the quality or value of property in which an interest was then acquired to the wrongdoer’s gain in breach of confidence: e.g. LAC Minerals Ltd above. The present is far removed from such a case.

90 The alleged breach of confidence relied upon by Polwood seems to be different in character from that found by his Honour (which related to Foxworth’s use of the information for its own purposes after the expiry of the licence). The reasons given for refusing proprietary relief were notably brief. But what we take from them is equally apt to the present case (assuming without deciding in Polwood’s favour both that Foxworth committed a breach of confidence in the manner now alleged and that the invention itself was capable of being the subject matter of a trust). The confidential information was conceptual in character and, though it was used in developing the PSU, it was augmented by Foxworth’s expenditure of much time, energy and inventive skill. His Honour made no finding of the actual extent of the contribution so made by Foxworth, but he did find that it was inventive. In these circumstances, it cannot properly be said that the invention was attributable solely to the confidential information used. Absent any contractual entitlement to the advantage of Foxworth’s exertions, Polwood has no proper basis for claiming that all of the advantage produced by those exertions ought belong to it because some part of it was contributed to by the confidential information used. We would note in passing that Polwood denies that it should be obliged to make any allowances to Foxwood for its time etc, in the event that proprietary relief were to be granted.

91 While we would refuse to grant proprietary relief in any event, we would indicate that we do not consider it to be appropriate to deal with the questions whether there was, in any event, the particular breach of confidence now alleged and whether the ‘invention’ of itself is capable of being the subject matter of a constructive trust in circumstances where the patent application on foot was doomed to invalidity. As to the first of these matters, it was not considered by the trial judge; it resulted in fresh issues being raised on the appeal; and we have not had the benefit of adequate submissions from the parties on the issue. We do not consider that it should be allowed to be raised on the appeal. Neither do we consider that the alleged breach was adequately pleaded by Polwood. We need not repeat what we earlier said about the contents of Polwood’s defence and counter-claim.

92 Finally, we should make several observations about the trial judge’s alleged error in using the springboard ‘doctrine’ as he did: on this doctrine see Meagher, Gummow and Lehane, at [41-075]. His Honour was considering whether interlocutory injunctions, the actual terms of which were not before us, should, ‘if sought’, be extended. Having concluded that the confidential information had been put in the public domain by the patent applications, and that Foxworth had been deprived of its ‘head start’ in using that information his Honour concluded that any further injunctive relief (presumably against Foxworth) would not be warranted. While his Honour’s comments are cryptic, so understood, they are unexceptionable.

93 We would dismiss the appeal as it relates to the dismissal of Polwood’s claims for relief for breach of confidence.

94 The respondents (the Foxworth interests) by their cross-appeal contend that the primary judge erred in dismissing the Foxworth claim of copyright infringement by Polwood and Rampton said to arise out of a three-dimensional reproduction by the making of the PSU Mark III (otherwise known as the ‘Replica PSU’), of a two-dimensional drawing drawn by Kemp (Workshop Drawing 15) as one of a series of drawings. That drawing, informed by other drawings in a series of drawings authored by Kemp together with annotations and measurements contained in works by Power (also said to form part of the referable series of works) is said to contain virtually all of the features apparent to a non-expert examining the PSU Mark III with the result that Polwood and Rampton have made a substantial reproduction of the two-dimensional artistic works by constructing and configuring the three-dimensional Mark III apparatus.

95 It is not suggested that Polwood was given or obtained Kemp’s Workshop Drawing 15, copied that plan and then set about building the apparatus. Rather, Foxworth says Polwood indirectly copied Drawing 15 (informed by other sketch drawings) by electing to build the replica PSU by Rampton closely examining the PSU Mark II (which had been modified by Rampton) and communicating material measurements and design and configuration details to others (together with some inspections of the PSU Mark II by those other individuals, in particular, Mr Robert Rapley (‘Rapley’)) to enable drawings to be made and the PSU Mark III to be built. Foxworth says the similarities between, in particular, Drawing 15, the features of which are said to be embodied in the PSU Mark II, and the PSU Mark III, necessarily leads to a conclusion (or inference to be drawn) that Rampton consciously copied the PSU Mark II and by so doing indirectly reproduced the two-dimensional artistic work in which the copyright subsists. Foxworth says the Court can look to drawings in a series of drawings relating to the PSU Mark II to find features evident in the PSU Mark II as constructed, not otherwise expressed in the primary drawing relied upon as the source of the copyright. Foxworth relies upon contended substantial similarities between Drawing 15 (and features of the PSU Mark II evident in other sketch drawings), and the PSU Mark III to support both an inference of conscious copying by Rampton and Polwood, and satisfaction of the test of infringement, namely, a substantial reproduction of the work.

97 First, notwithstanding that Rampton drew Drawings 220 and 221 in April 2002 which reflect elements of the arrangement of the inter-connected tubes and other features, the drawings are merely ‘concept drawings’. They do not reflect the ‘shape’ of the PSU Mark II said to be directly copied by Rampton in 2003 thus indirectly copying the drawing for the PSU Mark II. An examination of the PSU Mark III is said to reveal the ‘shape’ or ‘expression’ of the arrangement of the features of the PSU Mark II. Therefore, a conscious decision must later have been made, it is said, by Rampton when developing the PSU Mark III to move to the shape and arrangement features of the PSU Mark II, in the PSU Mark III. Thus, an inference of copying is said properly to arise as the features of ‘shape’ in the PSU Mark III have no origin other than the substantial embodiment of the features in the PSU Mark II.

98 Secondly, the primary judge’s acceptance of the evidence of the expert, Dr Gilmore, called by Polwood, who identified material differences between the PSU Mark II and the PSU Mark III, reflects error as Dr Gilmore did not consider Kemp’s Workshop Drawing 15 which is the critical drawing. Foxworth says that in the absence of Dr Gilmore considering that drawing, no reliance can be placed upon his assessment of the similarities or dissimilarities between the PSU Mark II and the PSU Mark III.

99 Thirdly, there are features in Kemp’s Drawing 15 which are dictated by functionality. They are the separate construction of the ‘header tank’ and the ‘triangular water holding’ device designed to be dis-assembled and assembled as contiguous features should the apparatus be moved from site to site and secondly, the possible use of the header tank as a tank for a boiler should steam be deployed as part of the process. These features also appear in the PSU Mark III. However, the PSU Mark III apparatus developed by Rampton was not intended, it is said, to be moved (that is, it was not intended to be a portable apparatus) nor was steam to be used in the PSU Mark III. Foxworth says it is odd therefore that the PSU Mark III also reflects the same configuration of features in part dictated by those two considerations although irrelevant to the operation of the PSU Mark III. Foxworth says that these considerations also support a clear inference of deliberate copying by Rampton.

100 Fourthly, having regard to the matters just mentioned and Rampton’s daily access from January 2001 to the PSU Mark II located on his property at Maryborough, thus providing Rampton with an ‘opportunity’ to copy the PSU Mark II, Foxworth contends that the primary judge’s finding that Rampton did not ‘set out to copy’ the PSU Mark II ‘even though he was familiar with the modified PSU [241]’ is unsupported by the evidence.

101 Fifthly, the primary judge gave insufficient weight to the similarities between the PSU Mark II and the PSU Mark III and placed too much reliance upon the dissimilarities between each apparatus. Further, the primary judge ought not to have relied upon the evidence of Dr Gilmore in concluding that no substantial reproduction of the work had occurred in three-dimensional form. Had the primary judge given appropriate weight to the identified similarities, the only conclusion open was that all of the material features of the PSU Mark II had been taken. In other words, applying a test of the quality of that taken, infringement was made out, as it would be, says Foxworth, if this comparison had been made in an orthodox house plan case. To that end, the Court was invited to overlay a transparency of the PSU Mark II over a drawing of the PSU Mark III to demonstrate the substantiality of the taking.

102 In addition, Foxworth now abandons its contention of sole inventorship and says this. The apparatus is an aspect of the invention; the apparatus is an invention by Foxworth; the Polwood concept disclosed to Foxworth was insufficient to enable the apparatus to be designed and made workable; Foxworth and Polwood are joint inventors; the Polwood patent application as framed comprehends integers present in the PSU, the modified PSU and the PSU Mark III; and the patent application ought to be amended to reflect the joint inventorship of Polwood and Foxworth. Yet, notwithstanding these contentions of joint inventorship, Foxworth says, in effect, that it is entitled to reach through the grant of rights conferred by the Patents Act upon joint inventors (ss 13, 15 and 16 of the Patents Act) and point to its contribution of a drawing as part of its contribution of inventive skill, and as owner of the copyright in the drawing, constrain the exploitation right of a co-inventor, on the ground that such conduct is a three-dimensional reproduction of the drawing. Foxworth says Polwood can do anything to exploit the invention by taking or applying each and every identified integer of the invention (identified in the present patent application in respect of each of the PSU, the modified PSU and the PSU Mark III) provided the expression of that use does not constitute a substantial reproduction of Foxworth’s two-dimensional drawing in three-dimensional form. Whilst that contention would be entirely consistent with an assertion of sole inventorship, it seems inconsistent with an acceptance of joint inventorship. That contention may require a consideration of the interaction between the Copyright Act 1968 (Cth) and the Patents Act in determining whether a joint inventor (who is not an author of a work forming part of a contribution to inventorship by another) necessarily has an implied licence to reproduce the artistic work of a joint inventor, as an incident of the exercise of rights conferred upon each inventor. That question would only arise if the PSU Mark III is demonstrated to be a substantial reproduction of the relevant drawing for the PSU Mark II, in three-dimensional form.

104 Polwood by Rampton and Connick contributed the foundation concept taken up by Foxworth including the use of two connected tubes and augers as part of a processing mechanism. The development of the prototype PSU by Kemp was an attempt to translate the original concept into a working application. Rampton and Connick had considered the use of augers before Kemp began the engineering of an apparatus. The prototype PSU was then further developed by Kemp and ultimately the working prototype (the PSU Mark II) was placed on the premises of Polwood. Rampton modified the installed PSU to make it function without jamming and becoming dysfunctional by reason of other problems. Rampton’s modifications were significant. Rampton then sought to improve the modified PSU in developing the PSU Mark III. Accordingly, having regard to the relationship between Polwood and Foxworth; Polwood’s disclosures to Foxworth; and the circumstances concerning the development of versions of the PSU, no inference of ‘conscious copying’ ought properly to be drawn by reason of Rampton’s ‘opportunity’ to inspect and copy the PSU Mark II or by reason of features in the PSU Mark II that might be apparent in the PSU Mark III upon examination by a non-expert. Polwood says some similarity of features is to be expected. Polwood says the finding that Rampton did not set out to copy the PSU Mark II was plainly open on the evidence; the finding to that effect is one of credit by the primary judge; and the finding ought not to be disturbed.

105 Further, the conclusion the primary judge reached that material differences between the PSU Mark II and PSU Mark III are such that no substantial reproduction of the relevant drawing has occurred was also open on the evidence. Polwood says there is no demonstrated error on the part of the primary judge in the assessment of the features of the PSU Mark III and its comparison with the PSU Mark II or the relationship between the drawings of Kemp, the PSU Mark II and the features embodied in the PSU Mark III. Polwood says there is no error in the assessment and acceptance of the evidence of Dr Gilmore in informing the primary judge’s assessment of whether the PSU Mark III is a substantial reproduction in three-dimensional form of the relevant drawings.

106 Since Foxworth challenges the basis of the primary judge’s findings in favour of Rampton that he did not set out to copy the PSU Mark II nor instruct Rapley to do so, it will be necessary to consider the findings of the primary judge and the evidence in a little detail.

108 As to the conduct of the parties in relation to the design, construction and installation of the PSU:

109 Having reviewed the evidence of Power, Kemp and Rampton on a range of matters, the primary judge expressed a ‘lack of confidence in the reliability of Power’s evidence’ [104]; concluded that Kemp was a ‘partisan witness, anxious to avoid making concessions’ [105]; and as to Rampton, concluded:

110 As to Rampton’s evidence concerning the development of the PSU Mark III and the further patent application, the primary judge noted these matters:

112 Having discussed other aspects of the development of the Kemp drawings and Rampton’s development of the PSU Mark III (to be discussed shortly), his Honour made these findings:

113 As to Connick’s evidence, the primary judge found that ‘Connick is a person of integrity who took care to have included in his affidavits his best recollection of what had transpired’ [66]. The primary judge found Connick’s recollection to be generally supportive of the account given by Rampton. As to that, Rampton and Connick in the early 1980’s discussed the concept of transporting bark through processing equipment by means of two augers positioned at right angles which Connick described as ‘the steaming tube concept’. In 1996, after Rampton recognised the potential to use the waste product of orchid bark production as potting mix or peat substitute, Rampton and Connick again discussed the potential of the steaming tube concept. At that time the prospect that the movement of material by augers might further break up bark particles was not a concern in relation to those two products. After lengthy discussion of the method, Rampton chose, at that time, to adopt the ‘big tub’ process rather than the steaming tube concept on grounds of cost and convenience [59] and [60]. On those occasions when a need to increase production of peat substitute and potting mix were discussed, Connick told Kemp of the steaming tube concept and in particular the dual auger idea including Connick’s opinion that it would permit a higher level of production and was the preferred design if orchid bark was not being produced [61]. Moreover, Connick produced drawings and in particular a drawing described as ‘MLC1’ which was the only drawing Connick had retained. The primary judge found that although Connick, a man aged 90, was unsure of certain things and in particular the specific occasion on which he produced Drawing ‘MLC1’, the primary judge accepted, consistent with his findings as to Connick’s integrity, that Connick did drawings of the steaming tube and dual auger concept from time to time in Kemp’s presence and had discussions with Kemp about them.

115 The findings of the primary judge as to the relationship between Polwood and Foxworth are central to the conclusion that Rampton did not set about a course of copying the PSU Mark II or instructing others to assist him in the copying of the PSU Mark II. Rampton and Connick had experienced a long engagement with the foundation concept and although Kemp was responsible for an inventive design and engineering of a working sterilising unit, Rampton was determined to continue to develop the ideas inherent in the apparatus and improve it. No inference ought to be drawn of an intention to copy simply by reason of Rampton’s opportunity to copy the PSU Mark II or the entirely unsurprising consequence that the PSU Mark III contained an alignment of fluidly connected and synchronized augers in tubes connected at right angles through which bark would be moved taking account of optimised temperature ranges, water and heat retention and such matters.

116 At [82], the primary judge found that the apparatus Kemp and Power decided to build in the form of two tubes connected ‘at right angles’ occurred ‘after Kemp was told of this arrangement and its benefits’ by Connick and Rampton. That is not to say that Kemp and Power’s contribution was not inventive. Plainly, it was. The contribution ultimately of Kemp was to conceive, design, build and implement through the expenditure of ‘much time, energy and inventive skill’ in an inventive way, the assembly of features which produced an operational apparatus deploying the method disclosed by Rampton and Connick [215]. That apparatus was subsequently modified by Rampton.

117 As to the elements of the copyright claim itself, there is no challenge to the authorship of drawings by Kemp; the subsistence of copyright in particular drawings (and notably Workshop Drawing 15); the ownership of the copyright in Peachester Thoroughbreds Pty Ltd; the formulation by the primary judge of the qualitative test for determining substantiality in assessing reproduction of the work (S W Hart & Co Pty Ltd v Edwards Hot Water Systems [1985] HCA 59; (1995) 159 CLR 466 at 474 per Gibbs CJ) or the adoption of the non-expert test for determining whether the PSU Mark III is a three-dimensional version of the relevant two-dimensional drawing(s). Rather, Foxworth says the application of these tests has miscarried having regard to the evidence of substantial similarities coupled with the notion that the information conveyed by Power enabled ‘a competent engineer to produce a machine very similar if not identical to the PSU and replica’ (Dr Grigg’s commentary upon Dr Gilmore’s report).

119 Kemp produced a series of drawings numbered 1 to 26 (para 92, affidavit Robert Charles Kemp sworn 1 November 2005; drawings at Item 61, AB Volume 3). Kemp was anxious not to disclose meaningful coherent detail of the PSU in most of these drawings so as to avoid any possibility of copying of the PSU by those who might see any particular drawing. A number of the drawings were prepared to enable quotes for components to be given and the drawing reflects a part or sectional view of parts of the PSU. As to these matters, the primary judge said this:

120 In August 2000, Kemp authored Drawings 4, 8, 10, 11 and 25. The schedule at para 92 of Kemp’s affidavit cross references each of those drawings to the comment for Drawing 25 which is in these terms:

121 Those drawings depict two tubes related at right angles one to the other with a shorter tube depicting a conical entry at the top of the tube and a much longer tube. The drawings contain some dimensions. In August 2000, Kemp authored Drawings 13, 14, 15 and 16. Drawings 13 and 14 are sectional drawings of elevations of a tube. Drawing 15 is the primary drawing relied upon by Foxworth. Unlike the other drawings, it is described as a ‘workshop drawing’. The drawing depicts two tubes aligned at right angles. The cross hatching on each tube depicts the internal augers and shows where each auger sits within each tube. The drawing contains some measurements such as the length of each tube; the orientation of the longer tube to the horizontal plane, the height of the longer tube relative to the foundation or platform on which the apparatus sits, and some other measurements. The drawing is said to depict a ‘de-watering section’ at the end of the long tube. The drawing shows a support frame for the apparatus. The drawing also shows a four-sided box described as a ‘header tank’ located in the right angle section between the two tubes. Beside the header tank is a triangular shaped holding tank. The drawing shows a line with crosses above it which indicates a water line. That line extends across the header tank and triangular tank and each auger at the relevant level.

122 Drawing 15 does not depict a conical shaped section located at the top of the short tube. Nor does the drawing depict a box-like feature at the end of the longer tube. Both of these features appear in photographs (AB 1152) of the PSU Mark II. No doubt, this led the primary judge, in part, to conclude that the PSU Mark II is not, in any event, built in accordance with Drawing 15. Foxworth says that the Court can turn to Drawings 4, 8, 10, 11 and 25 as a series of drawings which depict the conical shape at the top of the shorter auger. Those drawings assist the Court in understanding the three-dimensional configuration of the object depicted in Drawing 15. Whilst the Court is entitled to have regard to drawings in a series of drawings for this purpose, none of these drawings (4, 8, 10, 11 and 25) are detailed precision drawings. They simply reflect a conical shape in very simple terms. Drawing 15 is more precise but fails to show the conical feature. The conical shape depicted in these other drawings is not reflected in the precise shape of the section shown in the photograph of the PSU Mark II. Moreover, the drawings do not depict the box-like section at the end of the longer auger. The photograph of the PSU Mark III shows a quite different section at the top of the shorter tube and an entirely different configuration to the end of the longer tube. Foxworth says the shape of the section at the top of the shorter auger in the PSU Mark III is simply dictated by the ‘direct drive mechanism’ adopted for feeding material into the shorter tube. Nevertheless, this explanation of the difference does not diminish the significance of the difference as a feature of the three-dimensional PSU Mark III. The primary judge was entitled to regard these differences as significant (that is, the shape of the entry component at the top of the shorter auger and the shape of the de-watering section at the end of the longer auger).

123 Rampton had previously conceived of two tubes aligned at right angles and the use of augers within the tubes. It is not surprising that the immediate appearance of the alignment of the tubes would bear a striking resemblance to the PSU Mark II quite independently of any question of copying the PSU Mark II. Further, Rampton had sought to introduce a direct drive mechanism that made the configuration of the top of the smaller auger different in appearance and function as an improvement upon the indirect drive mechanism. The box-like de-watering configuration at the end of the longer tube in the PSU Mark II is quite different in shape to the PSU Mark III. Although each apparatus contains similar features, those features, having regard to all the evidence, are not sufficient to infer indirect copying by Rampton. Further, the differential features properly form a basis upon which the trial judge was entitled to form a view, as a non-expert comparing the plan with the PSU Mark III that the PSU Mark III does not substantially re-produce the PSU Mark II as an indirect copy of Drawing 15 (informed by the features of the other drawings in the sequence upon which Foxworth relies).

124 That leaves to one side the additional matter that the PSU Mark II was not built strictly in accordance with Drawing 15 (relevantly informed) in any event. The drawings are basic in nature and not all the features in the PSU Mark II are present. Further, the contentions of Foxworth do not give proper weight to the contribution by Rampton of the concept itself and the continuing implementation of improvements to that concept in a working environment.

125 Foxworth expresses criticism of the reliance by the primary judge on the report of Dr Gilmore who did not have regard to Drawing 15. However, Dr Gilmore has considered the extent of the similarities and dissimilarities between the PSU Mark II and the PSU Mark III. In undertaking that comparison, Dr Gilmore, favourably to Foxworth, has, in effect, proceeded on the footing that the comparison between each apparatus is the relevant comparison as the PSU Mark II embodies all of the features of the foundation artistic work upon which it is constructed. The primary judge considered the report of Dr Gilmore and that of Dr Grigg, the expert called by Foxworth. The conclusions reached by his Honour in part aided by Dr Gilmore were open to him. In particular, his Honour reached this conclusion.

126 As to the comparison between the PSU Mark III and the modified PSU as a foundation for the assessment of indirect copying, no error has been demonstrated on the part of the primary judge. The finding that no substantial reproduction of the drawing has occurred is made clearer when it is recognised that the modified PSU incorporates features which are, in any event, not reflected in Drawing 15. The reliance upon the report of Dr Gilmore reflecting dissimilarities is entirely consistent with the sequence noted by his Honour at [99] and [100] that Rampton brought into existence ‘rough concept drawings’ [Drawings 220 and 221] unassisted by measurements or images of the PSU; Rampton retained a drafting service to prepare drawings which led to dimensional scale drawings in May 2002; and Rampton retained Robert Rapley, an engineer, to construct a replica PSU incorporating features which Rampton devised in the course of its construction. All of these matters are consistent with use of ideas comprised in the apparatus some of which were historically within the thinking of Rampton and Connick, rather than a substantial reproduction of Kemp’s expression of the apparatus by his drawing(s), through indirect copying.

127 Foxworth invites the Court to overlay the transparency for the PSU Mark II with a drawing of the PSU Mark III. Plainly, there are similarities but those similarities are explained by reason of the matters previously discussed and the dissimilarities remain properly within the assessment of the primary judge as substantial differences leading to the conclusion that there has been no substantial reproduction of the artistic work by reason of the construction of the PSU Mark III.

128 Foxworth says that Rapley was given by Rampton the drawings produced by Whittred which depict an apparatus that exhibits differences to the PSU Mark III. Foxworth says that Rampton must have elected to adopt in the PSU Mark III the features of the shape of the PSU Mark II and in aid of that conclusion, Foxworth says that Rapley was provided with dimensions by Rampton compounded by Rapley’s inspection of the PSU Mark II.

129 However, the primary judge considered all of these matters in properly and carefully weighing the evidence and in reaching the findings previously mentioned. Those findings were open on the evidence. The similarities, the communication of measurements by Rampton and the visit by Rapley to the Maryborough premises do not, by themselves, lead to a conclusion that Rampton and Rapley set about a course of copying the PSU Mark II. The similarity of features is otherwise explained as previously indicated.

130 Accordingly, there is no demonstrated error on the part of the trial judge and the cross-claim of copyright infringement by three-dimensional reproduction of Kemp’s drawings must be dismissed.

131 There is therefore no need to consider further the question of the intersection between the Patents Act and the Copyright Act in terms of whether Foxworth as co-inventor is entitled to rely upon the copyright in a drawing forming a part of its contribution to the invention to prevent its co-inventor from exploiting the invention in a way which would involve a three-dimensional reproduction of the two-dimensional drawing. Further, the question of the inter-relationship between the Patents Act and the Copyright Act was not the subject of argument.

132 Having regard to these conclusions, we are minded to make the following orders. First, the appeal from Order 10 of the Orders of the primary judge made in these terms, that, ‘No declaratory relief in respect of Polwood Aussie Bark’s patent application will be granted in favour of any of the plaintiffs or any of the defendants. Neither the third and fourth plaintiffs, on the one hand, nor the second and fourth defendants on the other are the inventors of all of the inventive concepts embodied in the claims in patent application number 2002950316’, is dismissed. Secondly, the appeal from Order 13 of the Orders of the primary judge made in these terms, that, ‘It is not appropriate to impose a constructive trust in respect of the plaintiffs’ misuse of the Confidential Information. The ‘springboard principle’ is applicable but its application does not justify the granting or extension of any injunctive relief’, is dismissed.

133 Thirdly, the cross-appeal by the Foxworth interests from the Orders of the primary judge dismissing the cross-appellant’s claim for breach of copyright and delivery up of the PSU Mark III apparatus on the footing that the apparatus is a three-dimensional infringement of the copyright of Peachester Thoroughbreds Pty Ltd subsisting in particular drawings, is dismissed. Fourthly, the cross-appellant’s appeal from the Orders of the primary judge dismissing the cross-appellant’s claim for a declaration that they are the sole eligible persons for the purposes of the Patents Act entitled to registration as co-owners in equal shares of patent application number 2002950316 and related international Patent Application No. PCT/AU03/000930, is dismissed.

134 We propose to direct the parties to make further submissions as to the Orders to be made in disposition of the appeal and Orders in relation to costs.

135 The costs of the appeal and cross-appeal and any proposed Orders in relation to costs shall be reserved for determination in the light of written submissions from the parties.

I certify that the preceding one hundred and thirty-four (134) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Finn, Bennett and Greenwood

Counsel for the Appellants:	Mr M P Amerena

Solicitor for the Appellants:	Deacons

Counsel for the Respondents:	Mr A Crowe SC, Mr A Musgrave

Solicitor for the Respondents:	Hawthorn Cuppaidge & Badgery

Date of Hearing:	19 February 2008, 20 February 2008

Date of Judgment:	18 February 2008

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	QUD 321 OF 2006

JUDGES:	FINN, BENNETT AND GREENWOOD JJ
DATE OF ORDER:	18 FEBRUARY 2008
WHERE MADE:	BRISBANE

Federal Court of Australia - Full Court

Polwood Pty Ltd v Foxworth Pty Ltd (includes corrigendum dated 5 March 2008) [2008] FCAFC 9 (18 February 2008)