Today’s update from the High Court – IP special leave applications refused

The High Court today heard special leave applications in two IP cases – however, in both cases Chief Justice French and Justice Gageler declined to grant special leave.

The first case was Ucorp’s application for special leave to appeal from the Full Court’s decision regarding an implied licence in respect of the copyright in Material Safety Data Sheets (MSDS).

Acohs argued that it was the owner of copyright in each MSDS that it created, and that UCORP had infringed those rights by supplying copies of those MSDS without a licence from Acohs.  At trial, Justice Jessup accepted Ucorp’s submission that it distributed copies of Acohs’ MSDS pursuant to an implied licence.  On appeal, Justices Jacobson, Nicholas and Yates held that there was no implied licence covering Ucorp’s conduct and therefore Ucorp was liable for copyright infringement. In reaching this decision the Full Court held that a ‘licence will only be implied when there is a necessity to do so’.

Ucorp’s special leave application centred on whether the Full Court had improperly applied the test for determining the existence of an ‘implied licence’ by importing a specific requirement of ‘necessity’.  Ucorp argued that there was no such requirement in the test as set out by Justice Jacobs in Beck v Montana Constructions Pty Ltd.  If there was any doubt about the nature of the test, Ucorp submitted that this would be a question for the High Court to resolve.  In refusing special leave, French CJ and Gageler J considered that the determination of the scope of the implied licence was based upon the application of accepted principles, and the Full Court’s reasoning was not attended by sufficient doubt to warrant special leave.

The second IP matter was SNF’s application for special leave regarding the correct test to apply for determining innovative step and the proper construction of the claims of CIBA’s patents.

The dispute between SNF and CIBA concerned CIBA’s innovation patents for water-soluble polymers used as flocculants in the treatment of mining waste. At both trial and appeal (by a 2:1 majority), CIBA’s patents were held to be valid.

In its special leave application, SNF ran two primary arguments:

1.   That the primary judge and the majority of the Full Court applied the incorrect test for innovative step, by finding that alleged innovation had an ‘important effect on the [waste treatment] process’.

However, French CJ and Gageler J considered that finding the claimed innovation had an ‘important effect’ was not inconsistent with the language of the Patents Act, which uses the phrase ‘substantial contribution to the working of the invention’.

2.   That the primary judge and the majority of the Full Court took an incorrect approach to construction of the patent claims by improperly relying on certain expert evidence when determining  the meaning of the term ‘rigidification’.

French CJ and Gageler J considered that these arguments were not sufficient to warrant special leave, as they related to the application of principles of construction, and not an error in the principles themselves.