Advanta’s request for more time was denied by IP Australia in 2020, but the company was thrown a lifeline last month by a decision of Administrative Appeals Tribunal deputy president Ian Molloy, who ruled that the failure to pay the fee in 2016 was caused by an error or omission by the company’s legal representatives, Spruson & Ferguson, and granted Advanta 28 days to pay the fee.

Nufarm filed a Federal Court appeal of Molloy’s decision on Tuesday citing a number of grounds, including that Molloy “acted on a wrong principle”,  “mistook the facts”, and wrongly accepted the evidence of Advanta and its key witnesses.

In his decision allowing Advanta to renew the patent, which he accepted was “of considerable commercial value” to Advanta in its activities relating to canola in Australia, Molloy found the non-payment of the fee was an error or omission, a phrase he found to have a “broad scope.”

“[The phrase] includes a series of errors and breakdowns in procedure or a failure to exercise due diligence. It also extends to negligence and incompetence…[and] the breakdown of a system that lacks sophistication,” he said.

“The failure to pay the renewal fee by the due date, or by the end of the grace period, was caused by identifiable errors or omissions…which in my view can be properly regarded as being within the ‘broadly protective and remedial operation’ of s 223 of the Patents Act.

“Only a year before the 2017 renewal fee was due, Advanta entered into a licensing agreement in relation to the technology protected by the patent which was intended to run for a further thirteen years.

“There is no dispute, and I find on the evidence, that Advanta always intended to maintain the patent.”

Molloy found that an email from Sprusons was incorrectly addressed to a defunct email address for marketing purposes, as well as to employees who had left the company – instead of the employee it had been directed to contact.

“Had Sprusons directed its email to Dr Tabah, whom it had been instructed in August 2017 was the person responsible for the management of the patent, then payment could have been made,” Molloy said.

Molloy further found that the fee failed to be paid in the context of confusion caused by the departures of multiple employees responsible for the renewal payment. He also found that the notices to renew were sent only by post, and could have been lost.

“There was a system in place for the payment of renewal fees which worked satisfactorily until it started to falter in late 2016,” he said.

“Searches of Advanta’s records have not located a single notice or associated record. Advanta submits, and I accept, either the notices did not arrive, or they were delivered to Advanta’s office, in Toowoomba, and were subsequently lost.”

In its notice of appeal, Nufarm submits that Molloy “mistook the facts” in his appraisal of the surrounding circumstances, and further questioned whether “the disclosure of the processes by which the error came to be committed….is relevant to the exercise of the discretion [to grant an extension of time under the Patents Act]…in a de novo appeal.”

Nufarm further argues that the Tribunal ought to have found there was no system in place for paying renewal fees, and that as a result there could have been no finding of an error or omission in that system that led to the failure to pay the fee.

“Having found that [Advanta] failed to redirect mail received by it in relation to the payment of renewal fees, and having found that the [Advanta] did not allocate anyone with clear responsibility for ensuring renewal payments were made once [the relevant employees] left the employment…the Tribunal mistook the facts and erred in finding that at the relevant time, [Advanta] had in place a system for the payment of renewal fees,” the notice to appeals says.

Nufarm also argues that Molloy was wrong in his finding that Advanta provided “comprehensive, frank, and clear disclosure of all the circumstances”, and his acceptance of the evidence given by Advanta’s current and former managing directors Barry Croker and Nick Gardner.

Molloy found Croker and Gardner to be reliable and candid witnesses, noting especially that Croker made “considered concessions”, including in relation to his “flawed” evidence given to IP Australia in 2020.

Molloy found that the differences between the evidence provided to IP Australia and to the AAT had been “adequately explained” by Croker.

Croker “erroneously advanced” to IP Australia that Advanta’s new management database had been the cause of the error or omission – which Nufarm contended was a “misrepresentation”.

“I am satisfied that Advanta’s evidence before the delegate was not deliberately misleading and that the searches it conducted prior to the filing of its evidence before the delegate were reasonable in the circumstances and were not deliberately confined,” Molloy said.

But on appeal, Nufarm argues that Molloy erred in his acceptance of Advanta’s evidence.

“The Tribunal acted on a wrong principle and erred in finding that [Advanta] had provided a comprehensive, frank and clear disclosure of all the circumstances of the error or omission that led to the failure to do the relevant act,” the notice says.

Lawyerly has reached out to Advanta Seeds for comment.

Nufarm is represented by Phillips Ormonde Fitzpatrick.

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