Not All Grace Periods Are Created Equal
What’s a Grace Period?
The Australian Patents Act 1990 and regulations provides a number of circumstances in which a ‘grace period’ can be relied upon in a defence to alleged lack of novelty and/or inventive step. That is, there are some things that you can do with your invention before you file a patent application without impacting its validity.
Which Grace Period are we Dealing With?
The term ‘grace period’ is used broadly to describe a range of circumstances. Most commonly at present, it is used to describe the ability to set aside any publication or use of an invention that occurred up to 12 months prior to the filing of a complete application (see s 24(1)(a) and Reg.2.2 (1A).
The term is also used to refer to a range of circumstances that are permissible up to 12 months prior to the priority date for a claim for the invention. These circumstances include the “working in public of the invention”… “for the purposes of reasonable trial” (see s 24(1)(a) and Reg. 2.2(2)(d)).
The important distinction is that the first circumstance provides a broad 12 month period of exemption prior to the filing of a complete patent application. The second set of circumstances provides the more time generous exemption of up to 12 months prior to the priority date (for example, this may be the filing date of a provisional patent application or an overseas-filed priority patent application) but more limited exemption in terms of circumstances.
The Long and the Short of It
In the recently decided appeal case of Fuchs Lubricants (Australasia) Pty Ltd v Quaker Chemical (Australasia) Pty Ltd  FCAFC 65, the distinction between these two grace period options became very important. The full text of the decision can be accessed here.
Quaker Chemical (Australasia) Pty Ltd (Quaker) is (for the moment) the owner of a standard patent and a divisional innovation patent, both titled “Method for Detecting Fluid Injection in a Patient”. It relates to detecting High-Pressure Fluid Injection (HPFI) injuries that can be sustained by workers when impacted by high-pressure fluid escaping from, for example, hydraulic machinery used in mines. In short, a detectable dye is mixed with the hydraulic fluid, whereby inspection of the patient post-injury reveals the presence of the dye under the skin.
At first instance, Quaker (who had acquired the invention and patent from the inventor and his company) sued Fuchs for infringement of the patent. Fuchs denied the infringement and sought revocation of the patent in turn.
In seeking revocation Fuchs referred to a series of disclosures that occurred in October/November 2010 (referred to as first, second and third disclosures) being within 12 months prior to the filing of a provisional patent application by the inventor and from which the patent in question claimed priority (the provisional application was filed on 2 September 2011). These disclosures however occurred more than 12 months prior to the filing of the complete patent application (on 2 February 2012) that resulted in the grant of the patent being relied upon.
The primary judge had found that each of the first, second and third disclosures fell within the grace period of 12 months prior to the priority date of a claim to the invention as being “working in public of the invention”… “for the purposes of reasonable trial”. Fuchs appealed this finding, amongst others.
The Gelatine Hand of Fate
The first and second disclosures involved the disclosure of the invention to the staff of a mine (Peabody Energy Australia Pty Ltd’s Metropolitan mine in Helensburgh, NSW), which involved a demonstration of the invention to those staff in a car park, which demonstration creatively made use of a ‘gelatine hand’ simulator. The third disclosure was a subsequent disclosure of the invention by Metropolitan mine staff to Fuchs.
The primary judge had found that the series of disclosures were a ‘necessary precursor’ to the public working of the invention and as such were captured by the grace period. This was overturned by the Full Federal Court on appeal on the basis that the first and second disclosures were nothing more than the inventor trying to create interest in the invention (see para ) and noted that the inventor could (and by extension should) have been made under express or implied conditions of confidentiality.
Typically, the nature of public disclosures that have attracted the benefit of the grace period of s 24(1)(a) and Reg. 2.2(2) (d) have been those in which a large item of machinery that incorporates a mechanical invention, for example, must be worked outdoors ‘in public’ by its nature. Put another way, there has been no way in which it might reasonably be worked indoors, in private, and provide the inventor(s) with the desired information that will inform the process of conceiving and refining the invention. The car park demonstration by the inventor to the staff of a mine was not found to sit well with the relevant precedents.
What Might Have Been Done Differently?
First, it should be noted that these comments are provided with the benefit of 20/20 hindsight and without any in-depth understanding of the specific circumstances over and above that of the decisions referend here.
However, if rather than filing a provisional patent application in September 2011, a complete application was filed, then Quaker will have had access to the grace period available under s 4(1)(a) and Reg.2.2 (1A), which rather than being limited to working of the invention in public for the purposes of trial, would have provided protection from any publication or use of the invention.
These circumstances highlight how important it can be to fully understand what use of the invention has been made prior to filing. Full disclosure of any use of an invention to your patent attorneys will allow the appropriate strategy to be followed in seeking valid patent protection.