Grace periods

As a general rule an inventor should not publicly disclose his invention before filing a patent application. This is because in most cases such a disclosure results in invalidity of the subsequent patent, however, in a number of countries, including Australia there are so-called "grace periods" which allow such disclosures to be disregarded if steps are taken within a certain time. Grace periods apply to circumstances including disclosure of an invention without an inventor’s consent and "self disclosure".

“Self disclosure” grace period provisions were introduced into Australia in April 2002. These provisions mean that publication of an invention by an inventor or patent applicant may be disregarded if a complete patent application is filed within 12 months of the disclosure. This may be a complete application for a standard patent or a complete application for an innovation patent1 or a divisional patent application but not a provisional patent application.

These provisions were considered for the first time in a case before a single Judge of the Federal Court in 2008 and then on appeal to the Full Federal Court in 2009 (Mont Adventure Equipment Pty Ltd v Phoenix Leisure Group Pty Ltd [2008] FCA 1476 and Mont Adventure Equipment Pty Ltd v Phoenix Leisure Group Pty Ltd [2009] FCAFC 84).

This was a case where Mont Adventure sold its travel packs less than 12 months prior to filing its complete patent application for a standard patent. While the patent application was still pending Mont Adventure became aware of allegedly infringing packs being sold by Phoenix Leisure.

A patent must be granted to pursue an infringer. Given this Mont Adventure availed itself of a strategy which provides quick grant of a patent, thus allowing it to pursue Phoenix Leisure for patent infringement.

The patenting strategy involved filing a “divisional” patent application for an innovation patent. The divisional was based on the standard patent application (the “parent”) and claimed the same priority rights as the parent application. The innovation patent application was filed and certified allowing Mont Adventure to institute infringement proceedings.

In the initial decision the grace period was found not to apply to the innovation patent meaning that the patent would be invalid due to prior sales of the travel packs2.

The Full Court rejected the interpretation on appeal. The Court found that the words “the complete application” referred to the parent application. This means that the innovation patent obtained the benefit of the grace period and was therefore valid.

The decision confirms that where the parent complete application and the divisional complete application are for the same invention, filing of the parent application within the 12 month grace period allows that grace period to be invoked for the divisional patent application even when the divisional application is filed outside of the 12 month period.

1. A standard patent application may take some time to mature into a patent whereas an innovation patent is not subjected to the same rigorous examination. An innovation patent must be examined and certified before infringement proceedings can begin. The term of an innovation patent is 8 years compared to 20 years for a standard patent.

2. The argument run by Phoenix was that to be within the grace period, the complete application for the innovation patent should have been filed within 12 months of the sale of the travel packs. As the sale of the travel packs occurred in October 2004 this means that the complete application for the innovation patent should have been filed by the relevant date in October 2005 whereas it was actually filed in November 2006.

©  Julie Harkins 2009