NEWS

Revisiting Fair Basis

Jacinta Flattery-O'Brien and Michael Zammit July 2005

Section 40(3) of the Australian Patents Act 1990 provides that “The claim or claims must be clear and succinct and fairly based on the matter described in the specification”. A claim not fairly based is invalid and can provide grounds for opposition or revocation. This section of the Act seeks to ensure that the patentee obtains protection only for an invention that has been properly disclosed in the description and nothing beyond. The question of whether there has been a "real and reasonably clear disclosure" of an invention in the specification must be approached through the eyes of the person skilled in the art bearing in mind the common general knowledge at the priority date.

Fair basis is a two-way test. The claims of a patent must be fairly based on any provisional or foreign application from which the patent seeks priority (if the priority date is to be relied upon) and they must also be fairly based on the description provided in the patent specification itself. While various tests for fair basis have been formulated, typically the Mond Nickel Rules¹  are applied whereby the following questions
are asked:

1)  Is the alleged invention as claimed broadly described in the specification?

2)  Is there anything in the specification that is inconsistent with the alleged invention as claimed?

3)  Does the claim include as a characteristic of the invention a feature as to which the specification
is wholly silent?

The Mond Nickel Rules are not, however, considered definitive² . Claims may lack fair basis for a number of reasons, including:

• Where what is claimed differs in kind from what is described;

• Where the invention is claimed too broadly in the sense that it goes beyond the disclosure of the description³, or is not restricted by features that the description represents as essential⁴;

• Where what is claimed is not a reasonable extrapolation of what, on the face of the specification, the applicant has actually done⁵;

• Where what is claimed is not the result achieved⁶;

• Where there is no “real and reasonably clear disclosure” of the matter claimed⁷.

Therefore, the court looks to more than a mere coincidence of language between the claims and the body of the specification. The court seeks to determine what is the actual nature of the invention described in the specification and not simply rely on what the specification asserts the invention to be.

At the priority date of the claims, door dead-latches were arranged such that it was possible for a person to lock themselves inside their house with their keys remaining outside or, alternatively, misplaced indoors. A solution was proposed and patented⁸ by Lockwood.

Claim 1 of the patent related to a latch assembly comprising five prior art features and a further, sixth feature, a “lock release means” that provided the inventive concept and addressed the deficiencies of prior art locks i.e. the lock could be opened from the inside without the key. Importantly, only one embodiment of the “lock release means” was described.

Doric manufactured and sold several key-controlled latches that, Lockwood claimed, infringed several claims of its patent, including claim 1. Doric commenced proceedings in the Federal Court of Australia, alleging that Lockwood had made unjustified threats of proceedings for infringement of the patent against it and its two distributors. Lockwood cross-claimed for infringement. Doric in turn cross-claimed against Lockwood seeking revocation of the patent on grounds of lack of fair basis.

At first instance⁹, claim 1 was held to lack fair basis and therefore declared invalid. In the court’s opinion the patentee had provided a single solution to a problem, yet attempted to claim all possible solutions to that problem. Hely J also rejected as too narrow the argument that since the words in the specification matched the words of the claims then the claims were necessarily “fairly based” on the specification.

Hely J made an order revoking claims 1-32 of the patent. The only remaining claim, claim 33 was an omnibus claim and was allowed to stand as it was directed to the preferred embodiment of the invention as illustrated in the drawings.

On appeal¹⁰ to the Full Federal Court, Wilcox, Branson and Merkel JJ concurred with the finding that claims 1-32 were invalid for lack of fair basis. Lockwood obtained special leave to appeal to the High Court.

In a unanimous decision, the High Court disagreed with the Full Federal Court, finding that the claims of the patent were fairly based and set out a number of principles relevant to the application of the fair basis test, as follows.

1) For the purposes of determining fair basis, arguments based upon UK cases decided on the 1977 UK Patents Act or old authorities which pre-date the statutory basis of fair basis in s 40(3) of the present Act, are irrelevant.

2) The words "fairly based" do not refer to abstract fairness. The question of fair basis does not call for a separate enquiry into the “fairness” of the claims, that is, the question is not whether the monopoly claimed is “fair”.

3)  The grounds of invalidity must be kept conceptually distinct. i.e. it is wrong to employ reasoning relevant to one ground of invalidity in considering another.

4) Assessment of fair basis requires a comparison between the claims and the “invention”, not the “inventive step” underlying the invention. The High Court followed authorities which required that there be a real and reasonably clear disclosure of the claimed invention in the specification. The “inventiveness” of particular integers is irrelevant to fair basis.