Biosimilars Deals 2021

Introduction

Newron Pharmaceuticals S.p.A. (Newron) and Zambon S.p.A (Zambon) have succeeded in their preliminary discovery application against Arrotex Pharmaceuticals Pty Ltd (Arrotex) in the Federal Court of Australia.  Newron and Zambon sought production of documents from Arrotex, for the purpose of deciding whether to commence court proceedings for actual or threatened infringement of two patents relating to the product and the process of producing high purity safinamide (which contains two particular impurities at a level less than 0.03% by weight).  Safinamide is the active ingredient in Xadago®, which is used in the treatment for moderate-to-late-stage Parkinson’s disease.

Justice Needham’s decision illustrates the ease with which patentees are able to obtain preliminary discovery in the Federal Court of Australia given the low bar set by rule 7.23 of the Federal Court Rules 2011 (Cth).

Background

In their preliminary discovery application, Newron and Zambon sought production of documents from Arrotex, for the purpose of deciding whether to commence court proceedings for actual or threatened infringement of two patents relating to the product and the process of producing high purity safinamide.  Arrotex had four Australian Register of Therapeutic Goods (ARTG) registrations for safinamide products which had been approved as generic versions of Xadago®.  Arrotex expected to start supply in the near future, following the listing of its products on the PBS.

Rule 7.23 provides that a party may apply to the Court for a preliminary discovery order if that party:

a) reasonably believes that it may have the right to obtain relief in the Court from another person or entity whose description has been ascertained;

b) after making reasonable inquiries, does not have sufficient information to decide whether to start a proceeding in the Court to obtain that relief; and

c) reasonably believes that:

i. the other person or entity has or is likely to have or has had or is likely to have had in their control documents directly relevant to the question whether the first party has a right to obtain the relief; and

ii. inspection of the documents by the first party would assist in making the decision.

In interpreting rule 7.23, the Full Court (Allsop CJ, Perram and Nicholas JJ) in Pfizer Ireland Pharmaceuticals v Samsung Bioepis AU Pty Ltd (2017) 257 FCR 62 (Pfizer) stated that:

• rule 7.23 is a beneficial provision, which enables a person who believes they may have a right to seek relief to obtain information to make a responsible decision as to whether to start court proceedings;
• the party seeking preliminary discovery must prove that it has a belief that it may (not does) have a right to relief, and must demonstrate that the belief is reasonable, either by reference to material known to the person holding the belief or by other material subsequently placed before the Court;
• the question of whether the belief is reasonable requires one to ask whether a person, in light of all of the material before the person holding the belief (or subsequently the Court), could reasonably believe that they may have a right to obtain relief; and
• to defeat a claim for preliminary discovery, the party from who discovery is sought will need to show, either that the subjectively held belief does not exist, or, if it does, that there is no reasonable basis for thinking that there may be (not is) such a case. That may be done by demonstrating that no reasonable person, faced with the evidence relied on by the prospective applicant, would think that a right to relief might exist.

Newron and Zambon relied on the evidence of Zambon’s General Counsel, Ms De Dominicis, who was the person “primarily responsible for making legal decisions on Zambon’s behalf relating to its concerns” about the possible infringement of the patents.  Ms De Dominicis stated in her evidence that she inferred that the Arrotex products must have been approved on the basis of bioequivalence with Xadago®, and that there was nothing in the material available to her which would lead her to believe that the Arrotex products differed from Xadago® in terms of efficacy and safety.  Accordingly, she believed, but did not know, that the Arrotex products might contain high purity safinamide, and/or might be made using the patented processes.

Arrotex principally relied on the expert evidence of Professor Michael Roberts, an Emeritus Professor of Clinical Pharmacology and Therapeutics at the University of Queensland, and Emeritus Professor of Therapeutics and Pharmaceutical Science at UniSA Clinical and Health Science.  Professor Roberts stated, in his evidence (amongst other things), that determination of bioequivalence did not require determination of whether two drug products have the same or similar levels of impurities, and that there was no reason to believe the percentage of the impurity in the Arrotex products might be below the claimed threshold, because even amounts of the impurity far above that threshold would still result in blood plasma concentrations so low as to be therapeutically meaningless.

Key Issues

The key issue for Justice Needham’s determination was whether Newron’s and Zambon’s belief that they may have a right to relief against Arrotex was reasonable.

In short, her Honour found that Newron’s and Zambon’s belief was reasonable, or, in other words, was not a belief based on “unreasonable, untenable, irrational or baseless” considerations or views.  In reaching this view, Justice Needham noted that rule 7.23 must be applied in a way which gives full weight to its purpose, which is to allow a person to make up their mind whether to commence proceedings.  Her Honour further noted that Newron and Zambon did not need to establish a prima facie case of patent infringement, and that the relevant question was not whether one scientific view was more or less persuasive than another.

Her Honour considered that, giving the views of Professor Roberts the appropriate weight, in the context of the preliminary discovery application, Newron’s and Zambon’s evidence did not demonstrate affirmatively that the safety level of impurities in safinamide was lower than 0.03%, nor did it demonstrate affirmatively that the bioequivalence of the Arrotex products meant that they were the same high purity formulation as Xadago®.  However, her Honour did not consider that she needed to be persuaded to that level.  Instead, her Honour considered that, given the range of scientific views expressed in the patents and Newron’s and Zambon’s evidence, and that given that the Arrotex products did contain safinamide, there was a reasonable basis for the belief that Newron and Zambon might have a right to relief.

Justice Needham did not find persuasive Arrotex’s argument that, as the Therapeutic Goods Administration did not recognise the 0.03% impurity level as a safety threshold, Ms De Dominicis’ belief was unreasonable.  Nor did her Honour accept Arrotex’s submission that bioequivalence of the prospective parties’ products, and reliance on the same testing for each products’ Product Information, did not give rise to a belief that the impurity factor may be present.  Neither ruled out the possibility that the claimed impurity level might be present.

Her Honour also considered Professor Roberts’ reasoning to be circular when he stated that, as his calculations were that safinamide with higher impurity levels were not toxic, then there was no reason to believe that the Arrotex products were high purity products.  To the contrary, her Honour considered that it was equally open to believe that they might be high purity products.  Her Honour also noted that Professor Roberts’ analysis was based on his calculations of toxicity by reason of blood plasma concentrations in vivo, and that in the context of the preliminary discovery application, her Honour had not been able to accept that the calculations on the various assumptions were unassailable.

Accordingly, her Honour held that, when all of the evidence was considered, including the expert evidence of Professor Roberts, a belief that Newron and Zambon might be entitled to relief appeared to be reasonable; that is, it is not a view that could not be held by any reasonable person.

Outcome and Implications

Her Honour ordered Arrotex to provide preliminary discovery, with her Honour then ruling on the access regime for the production of documents by Arrotex and on the issue of costs in a short subsequent judgment.  On the issue of costs, her Honour ordered that the costs of the preliminary discovery application be costs in the cause of any infringement proceedings, but should no infringement proceedings be commenced, then there be no order for the costs of the preliminary discovery application, with the intent that each party bear their own costs.

Justice Needham’s decision applies the principles set out by the Full Court in the Pfizer decision as to the factors relevant to a preliminary discovery application.  Her Honour’s decision illustrates the ease with which patentees are able to obtain preliminary discovery in the Federal Court of Australia given the low bar set by rule 7.23 of the Federal Court Rules 2011 (Cth).

About Pearce IP

Pearce IP is a specialist, life-sciences focussed, intellectual property/law firm offering lawyers and attorneys in Australia and New Zealand.

In 2025, Pearce IP was honoured by Australasian Lawyer and New Zealand Lawyer as a Top Specialist Firm, 5 Star Employer of Choice, and the “Standout Winner” for Inclusion and Culture (<100 employees).  Pearce IP and its leaders are ranked in every notable legal directory including: Chambers & Partners, Legal 500, IAM Patent 1000, IAM Strategy 300, MIP IP Stars, Doyles Guide, WTR 1000, Best Lawyers, WIPR Leaders, Best Law Firms, among others.

Pearce IP is the only leading IP firm in Australia and New Zealand with a female founder, and is certified by WEConnect International as women owned.

Scidera, Inc. v Meat and Livestock Australia Limited (No 2) [2025] FCA 1236

Introduction

Justice Rofe has handed down an interlocutory judgment dismissing Zoetis Australia Pty Ltd’s (Zoetis) application for summary dismissal of Scidera, Inc.’s (Scidera) patent infringement claims.  The decision addresses a novel question of Australian patent law: whether all essential integers of a claimed method must be performed domestically for infringement to occur where the method does not produce a product.

Background

Scidera is the patentee of patent AU2010202253 (the Patent) which broadly relates to methods for identifying traits in cattle through genetic testing using single nucleotide polymorphisms (SNPs) in nucleic acid samples.  Scidera alleged that MLA, along with the Agricultural Business Research Institute (ABRI), Zoetis Australia Pty Ltd, DataGene Limited and Genotyping Australia Pty Ltd (together, the Respondents), directly infringed or authorised infringement of the Patent through the provision of genomic selection services in Australia.

This decision follows an earlier interlocutory judgment by Justice Rofe in Scidera, Inc. v Meat and Livestock Australia Limited [2025] FCA 308, in which her Honour dismissed the Respondents’ applications to strike out Scidera’s statement of claim.  Following that decision, Scidera was permitted to file an amended statement of claim.

The dispute the subject of her Honour’s decision centres on Zoetis’ business model for genetic testing of Australian cattle.  According to evidence submitted by Zoetis Inc., this testing involved the following steps:

1. Biological samples from Australian cattle are collected and sent to Zoetis’ Queensland premises.
2. Zoetis sends these samples to its US-based related entity, Zoetis Inc., for testing.
3. Zoetis Inc. performs SNP Testing in the US using specialised SNP Chips that detect 50,000+ SNPs through a process involving DNA amplification, hybridisation, and fluorescent imaging.
4. The testing generates a SNP text file containing genetic data (the Genotype Files), which is transmitted back to Australia.
5. In Australia, the Genotype Files are analysed by associations or institutes representing breeders to produce reports such as Estimated Breeding Values (EBVs) and Australian Breeding Values (ABVs).  In the case of beef cattle, breeders received EBVs in Australia via ABRI.

Critically, Zoetis’ evidence stated that all SNP testing has been conducted by Zoetis Inc. in the US since Zoetis commenced business in Australia in 2012, and that Zoetis has never had the capacity to perform SNP Testing in Australia.

Zoetis’ application for summary dismissal raised an issue not previously determined in Australia: whether all essential integers of a claimed method must be performed domestically for infringement to occur where the method does not result in a product.  Broadly, Zoetis contended that as a matter of statutory construction, the act of exploitation must occur within the patent area (Australia), and where their SNP testing is performed in the US, there can be no infringement in Australia.

Consideration

Claim Construction

Despite extensive consideration of the Patent’s claims by Beach J in the appeal from the opposition decision in Meat and Live stock Australia v Cargill, Inc (2018) 129 IPR 278 (Cargill), and subsequently in the amendment application in Meat and Livestock Australia Ltd v Cargill, Inc (No 2) (2019) 139 IPR 47 (Cargill (No 2)), the parties still disagreed on the construction of claim 1, which provides:

A method for identifying a trait of a bovine subject from a nucleic acid sample of the bovine subject, comprising identifying in the nucleic acid sample an occurrence of at least three single nucleotide polymorphisms (SNPs) wherein each of the at least three SNPs are significantly associated with the trait, with the degree of statistical significance being p≤0.05, and wherein the at least three SNPs occur in more than one gene; and wherein (a) at least one of the SNPs [meets the limb (a) requirement], or (b) the SNP [meets the limb (b) requirement].

(Emphasis added)

Zoetis argued that the phrase “identifying in the nucleic acid sample an occurrence of at least three SNPs” refers to the step performed by Zoetis Inc. in the United States.  Zoetis characterised the phrase “method for identifying a trait” as a “purpose constraint”, whereby the physical act of conducting the genetic testing must be done with the purpose of resulting in the ability to identify or infer a trait.  According to Zoetis, the claim is met by the mere ability to identify or infer, regardless of whether an identification or inference is actually drawn.  At [73], Justice Rofe observed that:

In recasting the underlined integer as a purpose constraint rather than an essential integer, Zoetis seeks to dismiss Scidera’s contention that the identifying or the drawing of an inference of a trait is an essential integer of the claim that, when performed or used by Zoetis in Australia, satisfies the territorial nexus required by the acts of exploitation and infringement as contemplated by the Patents Act.

So on Zoetis’ construction, the claim is met by carrying out the genetic testing in the US with the mere purpose of being able to infer, and because nothing further is required, the integers of the claim are entirely carried outside the protected jurisdiction.

Scidera rejected this characterisation, contending that its own construction correctly adopts that of Beach J in Cargill, such that “the claim is infringed by a method which takes all the integers, including the actual identification or inference of a trait”.  Scidera referred to the Amended Statement of Claim which particularises that “[…] [t]he identification of the trait occurs upon the provision of the EBV reports”.

Justice Rofe’s “provisional view” favoured Scidera’s construction.  Her Honour rejected Zoetis’ “purpose constraint” characterisation, noting Beach J’s references to “purpose” in Cargill were made in the context of an anticipation analysis, not claim construction.  Beach J had held that for method claims, construing “for” as merely requiring that a disclosure of something that could be used for that purpose is “misconceived” and “inapposite” as it “involves disregarding what is an important limiting and characterising feature of the claim”.  Justice Rofe found that claim 1 requires both identification of SNPs through physical testing and a separate step of identifying or inferring traits, the latter of which appeared to be undertaken in Australia on the evidence available to her Honour.

Justice Rofe identified two flaws in Zoetis’ approach.  First, Zoetis impermissibly disaggregated the integers of the claimed method, focusing solely on the physical testing integer while relegating the identification or inference of traits to a mere purpose.  Her Honour cited Ariosa Diagnostics, Inc v Sequenom, Inc (2021) 159 IPR 371 (Ariosa Diagnostics) and National Resource Development Corporation v Commissioner of Patents (1959) 102 CLR 252 for the principle that the invention is a “unitary concept” and “it is the whole process that must be considered”.  Second, Zoetis’ submission that the invention is not a manner of manufacture contradicted Beach J’s findings in Cargill, where his Honour held the claim 1 was a manner of manufacture because the method “involves drawing an inference about the potential for the trait of interest to exist in the bovine subject” and creates “an artificially created state of affairs of economic significance”.

Territorial Question

Justice Rofe noted that the case raises “a novel and important question of law: whether all the essential integers of a claimed method or process must be performed within the patent area for there to be infringement of a claim to said method or process that does not produce a product”.

Her Honour considered the inclusion of an object clause under s 2A of the Patents Act 1990 (Cth) (the Patents Act), introduced by the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Act 2019 (Cth), which states that the object of the Patents Act is “to provide a patent system in Australia that promotes economic wellbeing through technological innovation”.  The Explanatory Memorandum to the amending bill further stated that the object clause would “assist courts in interpreting the Patents Act in cases where the text of the legislation is uncertain or ambiguous”, ensuring “that the patent system remains adaptable and fit-for-purpose”.  Justice Rofe noted that neither party addressed the object clause and how it might influence the question of whether potential infringers may circumvent a patentee’s exclusive rights to exploit its invention through divided performance of a method overseas.

Australian courts have previously considered infringement of method claims involving overseas use, but each involved the extended definition of “exploit”, wherein a product resulting from use of a method overseas was imported into Australia.[1]  Justice Rofe also referred to Ariosa Diagnostics, in which samples were taken from Australian patients and sent to the US for genetic testing and analysis, with the Full Court finding that the Harmony Test results did not constitute a “product” for the purpose of the definition of “exploit” in the Patents Act.  However, unlike the present matter, the method of detecting was carried out in its entirety in the US.  Thereafter, no further steps of the method remained to be performed in Australia – only the results of the test had to be electronically transmitted to the relevant medical practitioner in Australia, who would inform the patient of those results.  As those constituted mere information (and not a product), the Full Court held that no infringement occurred.

Justice Rofe noted that there is no fundamental requirement that all essential integers of a method claim that does not result in a product must be performed in the patent area.  Her Honour observed that there seems to be little basis in the Patents Act to distinguish methods which produce products (where offshore steps are considered), and those that do not.  Justice Rofe considered that such an “arbitrary distinction” would be inconsistent with UK authorities[2] which have demonstrated the UK court’s disinclination to enable infringers to avoid infringement by performing an integer of a claimed method offshore.

In reaching this view, Justice Rofe considered two modern UK cases.  Menashe Business Mercantile Ltd v William Hill Organisation Ltd [2003] 1 All ER 279 concerned a gaming system patent where the host computer processing customer bets was located in Antigua but accessed by UK customers placing bets from the UK.  In that case, Aldous LJ held that the UK punter “will in substance use the host computer in the United Kingdom, it being irrelevant to the punter where it is situated”.  Illumina, Inc v Premaitha Health Plc [2017] EWHC 2930 concerned a prenatal diagnosis patent where DNA sample preparation and sequencing occurred in the UK, but the data analysis and processing to generate diagnostic results occurred in Taiwan.  In that matter, Carr J held that the crucial question was whether, in substance, the process was used in the UK, accepting that any other result would make it “far too easy to avoid infringement of patents of this nature ‘given the ease of digital transmission and the ability to offshore computer processing’”.

Justice Rofe observed that these UK authorities demonstrate that the question of divided-performance of a method overseas is “not a simple one”, and that at this stage, “there may be an arguable case that the policy-based approach taken by the United Kingdom courts in Menashe and Illumina may align with a construction of ‘exploit’ which gives effect to the object clause of the Patents Act”.  Her Honour added that in each UK case, the question of law was “inextricably tethered to the factual circumstances”.

Outcome

Justice Rofe concluded that the matter was “not a straightforward case that is appropriate to be summarily dismissed”.  Her Honour noted that the “relevance and applicability of the United Kingdom case law in light of the object clause and differing statutory language” has not been the subject of argument and warrants full consideration at trial, further stating:

Whether the introduction of the object clause under s 2A of the Patents Act is consistent with a legislative intention towards a construction of infringement that patentees are entitled to enjoy the full benefit of their statutory right that ought not be set at naught by offshoring a step of a claimed method, is a question that merits fulsome argument and consideration on the facts of the case.

Consequently, Justice Rofe dismissed Zoetis’ application and ordered it to pay Scidera’s costs of the interlocutory application.

Implications

Should the matter proceed to trial, the proceedings are positioned to produce the first Australian decision addressing whether all essential integers of a method claim must be performed in the patent area (domestically) for infringement to occur where the method does not produce a product.  Justice Rofe’s decision signals that her Honour may adopt an “in substance” approach similar to UK jurisprudence, preventing circumvention of patented methods through the offshoring of essential steps.

[1] See Apotex Pty Ltd v Warner-Lambert Co LLC (No 2) (2017) 123 IPR 30 at [296]–[298] (per Nicholas J), endorsed in Warner-Lambert Co LLC v Apotex Pty Ltd (No 2) (2018) 129 IPR 205 at [167] (per Jagot, Yates and Burley JJ).

[2] See Von Heyden v Neustadt (1880) 14 Ch D 230, Saccharin Corp Ltd v Anglo-Continental Chemical Works Ltd [1901] 1 Ch 414 and Beecham Group Ltd v Bristol Laboratories Ltd [1978] 95 RPC 15.

About Pearce IP

Pearce IP is a specialist, life-sciences focussed, intellectual property/law firm offering lawyers and attorneys in Australia and New Zealand.

In 2025, Pearce IP was honoured by Australasian Lawyer and New Zealand Lawyer as a Top Specialist Firm, 5 Star Employer of Choice, and the “Standout Winner” for Inclusion and Culture (<100 employees).  Pearce IP and its leaders are ranked in every notable legal directory including: Chambers & Partners, Legal 500, IAM Patent 1000, IAM Strategy 300, MIP IP Stars, Doyles Guide, WTR 1000, Best Lawyers, WIPR Leaders, Best Law Firms, among others.

Pearce IP is the only leading IP firm in Australia and New Zealand with a female founder, and is certified by WEConnect International as women owned.

Dyno Nobel Asia Pacific Pty Ltd v Orica Explosives Technology Pty Ltd [2025] FCA 767

Introduction

In a lengthy 1300+ paragraph judgment, Justice Downes has handed victory to Orica, finding that Orica achieved “almost complete success” in its infringement case regarding three of the four patents in suit, and that Dyno Nobel’s invalidity attacks failed completely as did its unjustified threats claim.

A key takeaway from this decision is her Honour’s robust criticism of the manner in which Dyno Nobel ran its case, with her Honour criticising both the changing nature of Dyno Nobel’s case and its expert evidence.  On the former issue, her Honour declined to make findings sought by Dyno Nobel in its closing submissions about any matter which was not pleaded by Dyno Nobel, if Orica objected and her Honour was not satisfied that Orica knew the nature of the case it had to meet at trial.  Her Honour also adopted a similar approach regarding one aspect of Orica’s infringement case which was not part of its pleaded case.  On the latter issue, her Honour’s significant concerns about Dyno Nobel’s expert evidence led her Honour to place little weight on this evidence, seriously undermining Dyno Nobel’s invalidity case.

Dyno Nobel has appealed her Honour’s decision.

In our article, we focus in on the key grounds alleged in the invalidity case against one of the four patents in suit (Australian Patent No. 2006225079), as her Honour’s findings in this regard highlight the key issues which led to Dyno Nobel’s failure to make out its invalidity case on this patent as well as the three other patents in issue.

Background

The four patents the subject of the proceedings were:

1. Australian Patent No. 2006225079 entitled “Wireless detonator assembly, and methods of blasting”. The claimed invention related to detonator assemblies that were substantially free of physical connections with an associated blasting machine and to improvements in the safety of these wireless detonator assemblies.
2. Australian Patent No. 2007246165 entitled “Wireless electronic booster, and methods of blasting”. The claimed invention related to apparatuses used for wireless blasting and methods of blasting using these apparatuses.
3. Australian Patent No. 2010207873 entitled “Selective control of wireless initiation devices at a blast site”. The claimed invention related to the control of detonators and detonator assemblies used in mining via wireless communication; and
4. Australian Patent No. 2010302943 entitled “A method of underground rock blasting”. The claimed invention related to an improved method of blasting of rock underground.

All four patents were subject to the pre-Raising the Bar version of the Patents Act 1990 (Cth).

The product in issue was Dyno Nobel’s “CyberDet I” wireless electronic detonators (CyberDet I Device) which had been used and supplied for use, in certain blasts at two Australian mine sites: the Big Bell Mine and AngloGold Ashanti’s Sunrise Dam Mine.

Dyno Nobel commenced the proceedings seeking to revoke the four Orica patents and alleging unjustified threats.  Orica countered by cross-claiming that CyberDet I Device infringed its patents.

Australian Patent No. 2006225079 – Key Issues

Novelty

In holding that none of the prior art cited anticipated the claimed invention, her Honour addressed the issue of the date at which the prior art is to be construed.  Dyno Nobel submitted that the prior art should be construed at the priority date of the patent in suit, while Orica argued that construction should occur at the date of publication of the prior art.  After reviewing the statutory provisions and the case law, Justice Downes held that when determining the degree of disclosure required to show lack of novelty, the prior art document must be construed as at the date of its publication.

Inventive Step

Dyno Nobel failed to prove lack of inventive step in light of the common general knowledge (CGK) alone and/or taken together with one of three cited pieces of prior art (namely, two patents and a company website).

Justice Downes found that the objective facts arising out of the evidence provided compelling support for a conclusion that the claimed invention was not achieved by mere “routine” steps, or that the skilled person would have been directly led to carry out particular steps in the expectation that a particular research path “might well produce” a useful result.  Rather, the objective facts demonstrated that:

• a skilled addressee seeking to develop initiation systems for the mining industry at the priority date would have considered the removal of wires from detonators to be counter-intuitive for a range of reasons, including that removing the wires, without more, would have removed one of the major benefits of an electronic detonator, being the ability to obtain status information from the detonator; and that introducing wireless communications would have introduced the concomitant risks of electromagnetic interference and inadvertent detonation; and
• to the extent that there was any focus on removing wires, the industry trend favoured wireless transmission to a receiver which contained components of the blasting machine and which in turn was connected to the detonator.  In its invention, Orica “bucked that trend”: instead of dividing the components of the blasting machine and having wireless signals between those components, it incorporated a receiver into the detonator assembly, with the blasting machine transmitting signals wirelessly to the detonator assembly (including to an assembly the components of which were separated to enable better receipt of the wireless signal).

When considering the question of lack of inventive step in light of the CGK taken together with one of three cited pieces of prior art, her Honour held that the evidence did not demonstrate a reasonable expectation that the skilled person would have ascertained and regarded as relevant the prior art documents.  Her Honour considered that, at its highest, Dyno Nobel’s patent search evidence established no more than that certain prior art documents were capable of being returned by a literature search, which was insufficient.  In reaching this conclusion, her Honour noted that:

• the contemporaneous real world evidence was significant in that each expert in this case was working in the field of improving electronic detonator design (and in Mr Boucher’s case, wireless electronic detonators) or wireless communications for use in mines before the priority date, and no expert was aware of any of the cited prior art (other than Mr Napier being aware of his own company’s website); and
• the manner in which the patent searcher was instructed bore little resemblance to the manner in which the evidence indicated that the searcher would have been instructed by the skilled person, and likely resulted in a broader search being conducted by the patent searcher than would otherwise have occurred.

Crucially, Dyno Nobel’s lack of inventive step case was substantially undermined by her Honour’s opinion of the weight that could be given to its expert evidence.

Justice Downes noted that Dyno Nobel’s case depended significantly on the acceptance of expert evidence given by Mr Boucher and Mr Napier.  Her Honour was unable to place much weight on Mr Boucher’s evidence because her Honour considered that:

• Mr Boucher had misunderstood the concept of CGK, as his evidence indicated that he had wrongly assumed that publication of information was sufficient for the information to be CGK (on the basis that it should have been known), even though he was not aware of this information before the priority date;
• Mr Boucher was not representative of the hypothetical, non-inventive PSA as he was too highly qualified and too inventive;
• Mr Boucher had expressed opinions (including during the trial) based upon the evidence of other experts and the extent to which this occurred was not known; and
• the hypothetical task given to Mr Boucher went beyond the CGK, and was leading because it assumed a starting point (wireless electronic detonators) that the skilled person would not have been motivated to attempt to design based on the expert evidence.

Her Honour was also unable to place much weight on Mr Napier’s evidence because her Honour considered that:

• Mr Napier did not have expertise in the relevant technology, being electronic detonators or detonator technology;
• Mr Napier’s evidence was infected with personal knowledge of facts derived from his work which were not CGK; and
• Mr Napier indicated that his experience with a particular system would have impacted (i.e. biased) his response to the hypothetical task that was posed to him.

Best Method

Dyno Nobel alleged that Orica had failed to disclose the best method of performing the invention.  Her Honour held that this ground was not made out.  In reaching this conclusion, her Honour was again highly critical of Dyno Nobel’s pleading and evidence noting that:

• Dyno Nobel’s best method case was premised on an incorrect characterisation of the invention;
• Orica was only apprised of the full particulars of Dyno Nobel’s best method case during closing submissions.  Consequently, her Honour only considered the best method case which Dyno Nobel pleaded and opened on at the trial, not the case advanced in closing submissions, as in her Honour’s view to do otherwise “would be contrary to the interests of justice to permit it to succeed”;
• Dyno Nobel’s best method case relied upon Mr Boucher’s evidence, and, in particular, his incorrect understanding of the concept of CGK.  To make matters worse, her Honour also considered that Mr Boucher had conflated the requirements of US patent law with Australian patent law regarding what is required to be disclosed in a patent in Australia; and
• Given the low quality of Mr Boucher’s evidence, it was not surprising that Orica did not call any inventor or author of the particularised Orica documents.  Her Honour considered it to be self-evident that doing so would have run the risk that the assumptions underlying Mr Boucher’s opinions could be established through cross-examination of these witnesses.  Accordingly, her Honour declined to draw any adverse inference from the failure by Orica to call such persons as witnesses as there was an obvious forensic reason not to do so.

Her Honour also considered that Orica was not required to disclose idiosyncratic features of the voltage step-up or multiplication means which it had selected for use in its commercial embodiment of the invention.  This selection depended on the particular commercial product being built, and the componentry used elsewhere in the product, all of which was likely to be adjusted in the course of product optimisation.

Outcome and Implications

Justice Downes held that Dyno Nobel’s validity attacks failed completely as did its unjustified threats claim.  Orica, on the other hand, achieved “almost complete success” in its infringement case regarding three of the four patents in suit.

Her Honour’s decision is a salient reminder of the importance of clearly pleading a party’s case so that the other party is on notice of the case it has to meet.  Her Honour’s decision also highlights the central importance of expert evidence, the deficiencies of which in this case significantly undermined Dyno Nobel’s invalidity attack on the four Orica patents in suit.

Dyno Nobel has appealed her Honour’s decision.

About Pearce IP

Pearce IP is a specialist, life-sciences focussed, intellectual property/law firm offering lawyers and attorneys in Australia and New Zealand.

In 2025, Pearce IP was honoured by Australasian Lawyer and New Zealand Lawyer as a Top Specialist Firm, 5 Star Employer of Choice, and the “Standout Winner” for Inclusion and Culture (<100 employees).  Pearce IP and its leaders are ranked in every notable legal directory including: Chambers & Partners, Legal 500, IAM Patent 1000, IAM Strategy 300, MIP IP Stars, Doyles Guide, WTR 1000, Best Lawyers, WIPR Leaders, Best Law Firms, among others.

Pearce IP is the only leading IP firm in Australia and New Zealand with a female founder, and is certified by WEConnect International as women owned.

EIS Gmbh v LELO Oceania Pty Ltd (Liability Trial) [2025] FCA 1111

Introduction

In a victory for LELO, Justice Downes of the Federal Court has declared invalid and ordered the revocation of EIS GmbH’s (EIS) patent relating to feminine pressure wave massagers.  EIS had brought infringement proceedings against LELO Oceania Pty Ltd, LELOi AB and distributor Calvista Australia Pty Ltd (together, LELO) over LELO’s pressure wave massage products.  LELO then cross-claimed seeking the revocation of EIS’ patent and alleging unjustified threats and misleading conduct.  EIS has subsequently filed an appeal to the Full Court.

Background

The dispute concerns EIS’s patent AU2018200317 (the Patent), entitled “Pressure Wave Massager”.  The Patent describes a compression wave massage device with a single-chamber cavity that generates a stimulating pressure field through volume changes.  A key feature is the volume change ratio (VCR) which requires that the ratio of volume change to minimal volume must be between 1/10 and 1.  The Patent stated that this range was critical to ensuring the pressure field was stimulating but not painful.

EIS initiated Federal Court proceedings alleging infringement of claims 1-7, 9, 10, 15, 19-22 and 31 of the Patent by LELO’s products.  LELO denied infringement and cross-claimed for invalidity on multiple grounds.  LELO also alleged that EIS made unjustified threats and engaged in misleading conduct in its various communications to distributors and industry publications.

The proceedings generated two key interlocutory decisions.  In July 2024, Justice Downes granted LELO leave to rely on experimental evidence conducted in China, and in December 2024, her Honour ruled that one of LELO’s witnesses was not permitted to participate in the joint expert conferences concerning novelty and inventive step.  This article reports on the decision following the liability trial heard in February 2025.

Key Issues and Considerations

Construction and Infringement

EIS alleged the LELO products incorporated all essential integers of the asserted claims.  LELO denied infringement, arguing the products did not have the following integers: defined “ends” because the cavity is made from a single piece of silicon; a “single chamber” due to the cavity having a round or “honeypot” shape and a narrowing space towards the opening; and the VCR requirements when being used as intended.

Key to the infringement claims was the construction of the integer “a compression wave massage device when used on the clitoris” in claim 1.  EIS contended that the reference to “a compression wave massage device when used on the clitoris” meant the device must be capable of such use, but that the claimed features (including VCR) which are described in the subsequent integers of claim 1 are not referable to its use on the clitoris.  EIS’ construction was premised on the alleged practical inability to measure these features (including VCR) when the device is being used on the clitoris.  LELO disagreed, arguing the claim required all features to be present when the device is used on the clitoris.

Justice Downes agreed with LELO, holding that the phrase “compression wave massage device when used on the clitoris” in claim 1 limits the scope to a device that functions as a compression wave massager when used on the clitoris and has the features identified in the subsequent integers when so used.  Her Honour rejected EIS’ argument that the features identified in subsequent integers need only be present in the standalone device, noting that:

the words “when used on the clitoris” govern all of the features of the device that follow those words, such that each of those features must be present when the device is used on the clitoris when it is performing its function as a compression wave massage device.

The specification’s references to the VCR affecting whether the vacuum becomes “too strong and perhaps even painful” or whether “the suction effect becomes too low” could only refer to pressure generated when used on the clitoris.  Further, the amendment from “for use” to “when used” had a narrowing effect.

Given this finding on construction, Justice Downes held that EIS had not established that the LELO products infringed claim 1.  The testing of LELO products in laboratory conditions with a virtual planar surface did not establish that they infringed claim 1 when actually used on the clitoris, given insufficient information in the Patent about how to measure VCR in actual use conditions.  As all claims depended on claim 1, none of the LELO products infringed.

Clarity / Definition

LELO challenged whether the VCR feature provided a workable standard for defining the invention, arguing that VCR alone was an imprecise proxy for pressure and failed to account for critical variables.  Justice Downes found claims 1, 4, 6, 9 and 22 were invalid for lack of clarity and definition.

In making her finding in relation to claims 1 and 22, her Honour stated that:

… there is insufficient information in the Patent to enable the PSA to achieve the claimed stimulating pressure field, and the PSA cannot objectively ascertain whether what they propose to do falls within the ambit of the claims of the Patent as they do not identify a workable standard suitable to the intended use.

In relation to claims 1 and 22, her Honour noted that there were various deficiencies in the Patent, including:

• (i)   Insufficient information about measurement: The Patent taught measurement using a “virtual planar surface” in laboratory conditions but provided no method for measuring VCR when the device is used on the clitoris, where the cavity will have limited air exchange with the environment and the clitoris will occupy part of the cavity volume.
• (ii)   Starting position of membrane not specified: Expert evidence established that the starting position of the flexible membrane critically affects the pressure generated. If the membrane starts forward, only negative pressures are produced.  If it starts rearward, only positive pressures result.  The Patent did not specify the starting position.
• (iii)   Presence of clitoris not accounted for: The clitoris protrudes into the cavity, reducing the minimum volume and thereby increasing vacuum pressures. Given substantial anatomical variation, the resulting pressures will significantly vary, yet the Patent’s measurement method using a virtual planar surface did not account for this.
• (iv)   Air leakage when used on skin: EIS’ expert witness acknowledged that when used on skin, the device is “essentially closed” but there is “a limited exchange of air between the cavity and the outer environment. This means VCR measured in airtight laboratory conditions will not accurately predict pressure when used on skin, as the entry and exit of air will affect the resulting pressure.
• (v)   Use underwater: The Patent contemplates underwater use, however, LELO’s expert witness explained that water is incompressible, so there can be no effective volume change when the cavity is full of water. Specifying a VCR range is therefore meaningless for underwater use.

In relation to claim 6, her Honour found that the reference in claim 6 to the lateral wall of the chamber being “free from discontinuations” was unclear, noting that, if it was intended to claim something different to claim 3, then it was uncertain what that difference was intended to be, as there were many possibilities. In relation to claims 4 and 9, her Honour found that the reference to length in claim 4 was unclear and that the meaning of “the ratio of the width of the cavity of the chamber…to the length of the cavity of the chamber” in claim 9 was similarly unclear.

Insufficiency and Lack of Support

For the same reasons relating to VCR measurement, Justice Downes held that the Patent failed to enable the person skilled in the art to make the device without undue burden, and that the claims lacked support because there was no experimental data justifying the VCR ranges claimed.

Novelty and Inventive Step

LELO’s novelty challenge based on a Japanese patent in the name of Panasonic Electric Works Co failed because the VCR integers were not disclosed.  Similarly, all inventive step challenges failed because the experts agreed that the VCR integers and certain other claim features were not obvious based on common general knowledge, prior art documents, or prior use of other pressure wave massage devices.

Best Method and Utility

LELO’s best method challenge, which asserted that EIS knew of a method that would not be useful (a geared motor with high torque), failed.  While LELO relied on emails showing EIS rejected geared motors as “noticeably louder” with “unsatisfactory” operating noise, Justice Downes held that EIS was “not required to disclose idiosyncratic features of the motor which it has decided not to use in relation to its commercial embodiment of the invention”.  This was merely a design choice and the disclosed motor (without gears) was the best method.

The utility challenge also failed.  LELO alleged the Patent promised a simple and effective design with improved hygiene, easy handling with lubricant or underwater, and other features.  However, Justice Downes found the claimed device met the stated objectives.  While LELO argued that device could not be waterproof based on limited evidence of rust in one particular device and alleged leakage during experiments, her Honour found this evidence wholly inadequate to discharge LELO’s burden of proving the “waterproof promise” had not been met.

Unjustified Threats and Misleading Conduct

LELO alleged that EIS had made unjustified threats and misleading representations in its correspondence to distributors and press releases referencing victories in German courts, which LELO claimed incorrectly suggested that these victories were relevant to Australia.

Despite her Honour’s finding of no infringement, Justice Downes did not consider that any of the cited correspondence or press releases constituted unjustified threats or misleading representations. In particular, while a November 2023 email to distributor Calvista constituted a threat under section 128 of the Patents Act, it was not unjustified given:

• (i)    the European Patent Office’s rejection of LELO’s opposition and the similarity between the Australian and European patents; and
• (ii)   EIS’ infringement contentions not being unarguable.

Subsequent press releases to industry magazines were also not misleading, as statements about German court victories providing support for Australian proceedings were statements of opinion that would be perceived as such, and incorrect opinions did not constitute misleading conduct.  Further, most of the communications did not constitute threats as the Australian proceedings had already been commenced or because the communications did not convey a threat to bring infringement proceedings against other recipients or readers of the press releases.

Outcome and Implications

Justice Downes declared the Patent invalid and ordered its revocation (subject to a 28-day stay for appeal), dismissed EIS’ infringement claims, and otherwise dismissed LELO’s cross claims for unjustified threats and misleading conduct.  EIS subsequently filed an appeal in October 2025.

Justice Downe’s decision illustrates the critical importance of claim construction, which in this case underpinned both the infringement finding and the lack of clarity, definition, support and sufficiency findings. As the patent claims were limited by result, the disclosure in the patent of abstract measurements serving as proxies for the claimed result did not account for critical variables.  Further, the deliberate choice to claim a device “when used” in a particular way meant all claim features had to be present and measurable during that defined use – and laboratory testing that did not replicate those use conditions was not enough.

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