As illustrated by a recent short-term patent infringement case, it is vital that the patent applicant should disclose its invention sufficiently and maintain secrecy over the invention prior to making the patent application. Failure to disclose sufficiently or to maintain secrecy may cause the granted patent liable to be invalidated and deprive the owner of the protection offered by such patent registration.

Enforcement of short-term patent
In our November 2013 issue, we provided an overview to the enforcement of short-term patent rights. In short, due to the unique nature of short-term patent application (in which there is only formality examination and no substantive examination), the owner has to first establish the validity of the short-term patent by showing that the invention is novel and involves inventive steps before the owner can enforce the rights conferred by the short-term patent against others.

Thus, defendants to short-term patent infringement cases often challenge the validity of the short-term patent as a defence. If the owner fails to prove the validity, e.g. novelty and inventive steps, the short-term patent will be invalidated and the infringement claim will be dismissed by the court accordingly.

The recent case of SNE Engineering Co Ltd v Hsin Chong Construction Co Ltd [2014] 2 HKLRD 822 provides an example of how such defences were (successfully) argued and sheds some light on some vital points that every intended applicant should note well in advance of making a short-term patent application.

Background
The Plaintiff was engaged by the 1st Defendant as a subcontractor for pile removal works at the construction site for the Express Rail Link in Hong Kong. The Plaintiff in turn engaged the 2nd Defendant as a subcontractor for the provision of the equipment and operation for the pile removal works. It was not in dispute that the Plaintiff adopted in this project a “rotator and wedge” method for extracting building piles from the ground.

In around June or July 2011, the project was already running behind the original schedule. The 1st Defendant was thus considering terminating the subcontract with the Plaintiff. In view of the possible termination of the subcontract, the Plaintiff applied for short-term patent for its “rotator and wedge” method (the “Patent”) in August 2011 and subsequently obtained registration of the Patent.

Eventually in September 2012, the 1st Defendant terminated the subcontract with the Plaintiff. The 1st Defendant then engaged the 2nd Defendant directly to provide machinery and operators and continued to remove the building piles using, as alleged by the Plaintiff, the rotator and wedge method. The Plaintiff then commenced proceedings against the 1st and 2nd Defendants for infringement of the Patent.

Defences
To defend against the Plaintiff’s infringement claim, the 1st Defendant raised the following challenges against the validity of Patent:

1.         The Patent was invalid due to insufficient disclosure in its specification; and
2.         The Patent was invalid by reason of the lack of novelty and lack of inventive step.

It was clear that once the Patent was held invalid by the court, the Plaintiff’s infringement claim must be dismissed by the court.

Insufficient disclosure
In determining the sufficiency of the specification of the short-term patent, the proper question to ask is whether it disclosed a sufficiently clear and complete invention which could be performed by a competent person skilled in the art without undue burden.

The court held in this case that essential particulars were in fact missing from the patent specification.  For example, the use of a wedge as a jamming and immobilising device was the key concept of the patented process (the invention of rotator and wedge method), but the patent specification did not specify whether the circular wedge was used as a cutting or a jamming device. As such, the court took the view that a person skilled in the art using his common general knowledge would have difficulty in ascertaining the exact invented process covered by the Patent. Thus, the alleged invention had not been disclosed clearly and enough for it to be performed by a person skilled in the art without undue burden. The Patent was invalid due to insufficient disclosure of the invention in the patent specification.

Further, it was revealed that the description of the method in the search report submitted with the Patent application was inconsistent with that of the specification of the Patent. In the description of the patented process in the search report, the wedge was used as a cutting device, and what is novel about the patented process is that it involves “a new type of circular wedge to cut the pile”. But in the method claimed in the patent specification, if there were sufficient disclosure, the wedge would be used as a jamming device. As such, the search report filed by P was defective because the prior art search (which purports to show the novelty of a particular invention) was conducted on the basis of the understanding of the Patent as described by the examiner, which was different from the method claimed by the Plaintiff. As the search report filed in support of the short-term patent is defective, the patent should not be regarded as a valid one.  The court however left open the question of whether the owner can disregard the defective search report and instead prove the novelty of a patent at trial without relying on the search report.

Lack of novelty and inventive step
The court also held that the Patent was invalid by reason of enabling disclosures by the Plaintiff of the method, prior to its application, to the Defendants’ personnel involved in the project, hence, the communications between the Plaintiff and the Defendants and the performance of pile removal works in front of the engineering personnel involving in the project would have invalidated the Patent for want of novelty.

Moreover, since the process at the construction site could be observed by the public and any person skilled in the art would be able to work out the details of the method by observation, the method was considered by the court to have been disclosed to the public, before the application of the short-term patent was filed to the Hong Kong Patents Registry.

The court took the view that the Plaintiff had done nothing to protect the secrecy of the invention and the evidence suggested that the Plaintiff did not regard the method as confidential before the short-term patent application was filed. On the contrary, the Plaintiff’s application for the short-term patent was merely a tactical move to protect its interest under the subcontract when it was rumoured that the subcontract would be terminated by the 1st Defendant. Even if the Patent was not invalid by reason of insufficiency, it would still be invalid (by reason of lack of novelty) due to the disclosures made by the Plaintiff and its partners themselves to the public prior to the patent application. The Plaintiff’s claim was accordingly dismissed.

Points to note
From this case of SNE Engineering Co Ltd v Hsin Chong Construction Co Ltd, one can easily see the importance of sufficiency in specification when making the patent application and the importance of secrecy prior to making the patent application.  Inventors must make sure the patent application discloses clearly and completely details about the patent which would enable a competent person skilled in the art to perform the same without undue burden. Intended applicants must also protect secrecy before patent application at all costs, and it applies not only to short-term patents but also to standard patents; otherwise the patent rights may not be enforceable against third party and the protection conferred by such patent registration may be lost.

For enquiries, please contact our Intellectual Property & Technology Department:

E: ip@onc.hk

T: (852) 2810 1212

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Important: The law and procedure on this subject are very specialised and complicated. This article is just a very general outline for reference and cannot be relied upon as legal advice in any individual case. If any advice or assistance is needed, please contact our solicitors.