19 February 2016
Malaysia

Wither Dependent Claims

WITHER DEPENDENT CLAIMS: RECENT FEDERAL COURT DECISION AFFECTS PATENT DRAFTING AND PRACTICE IN MALAYSIA

The recent decision of the Federal Court of Malaysia in SKB Shutters Manufacturing Sdn Bhd v. Seng Kong Shutter Industries Sdn Bhd & Anor [2015] 6 MLJ 293 has caused much concern as it will have a significant impact on patent practice in Malaysia.

The case involved a granted patent for a panel suitable for use in a roller shutter owned by SKB Shutters Manufacturing Sdn Bhd (“SKB Patent”) where SKB initiated patent infringement proceedings against its competitor, Seng Kong Shutter Industries Sdn Bhd. Seng Kong counterclaimed for invalidation of the SKB Patent on the ground that the SKB Patent is not novel and that it does not involve an inventive step. The High Court held that the SKB Patent was valid and entered judgment against Seng Kong for patent infringement.

The High Court judge assessed the novelty of the SKB Patent by comparing the SKB product, that was made according to the SKB Patent, with the prior art in the form of an aluminium PVC piece (the “prior art”). The judge then held that the SKB Patent had not been anticipated by the prior art and was valid and that the invention was not obvious.

Seng Kong then appealed to the Court of Appeal. The Court of Appeal ruled that the High Court erred in its assessment of novelty by comparing the SKB’s product with the prior art. According to the Court of Appeal, in assessing whether the prior art in question anticipates the SKB Patent, the court should compare the features of the claims in the SKB Patent with the features disclosed in the prior art. The Court of Appeal found that the SKB Patent was lacking in novelty and therefore invalid.

On appeal to the Federal Court, the Federal Court agreed with the Court of Appeal that the correct approach in assessing novelty would be to compare the claims of the patent in issue with the prior art. The Federal Court held that Claim 1 and Claim 11 of the SKB Patent, which are the independent claims, lack novelty and hence, invalid.

The Federal Court further held that Claims 2 to 10 of the SKB Patent, which were dependent on Claim 1 were also invalid. It is pertinent that no assessment was made either in the High Court or the Court of Appeal on the validity of the dependant claims.

The Federal Court held that if an independent claim is found to be invalid, all claims dependent on it would be invalid as well. The Federal Court reasoned that the only way the dependent claims can survive is if the dependent claims are re-drafted to incorporate the features of the independent claim and are made as independent claims.

The Federal Court noted that under the Malaysian Patents Act 1983, there are no express provisions which allows for a patent to be amended when its’ validity is being challenged in Court. In this regard, the Federal Court distinguishes the Malaysian position from that in the United Kingdom where section 75 of the UK Patents Act 1977 expressly allows for amendment of a patent where its validity has been put in issue before a court.

The Federal Court also held that the Malaysian Patents Act does not allow a partially valid patent without amendments to be enforced. The Federal Court was of the view that section 56(3) of the Malaysian Patents Act 1983 merely states that some claims or part of a claim may be declared invalid and it does not expressly confer any power on the Court to enforce part of the patent which is found to be valid. Further, the Federal Court construed section 56(3) of the Malaysian Patents Act 1983 to refer only to independent claims.

The Federal Court distinguished the Malaysian position from that taken by the UK Courts where under section 63 of the UK Patents Act 1977, a partially valid patent without amendment can be enforced.

The Federal Court also affirmed the Court of Appeal’s finding that the SKB Patent lacked inventive step and held that the construction of patent claims can be determined without the assistance of persons skilled in the art. The Federal Court stated that any assistance required could be from an expert as an “unimaginative skilled addressee” and he need not approximate a person skilled in the art.

Wither dependent claims

The decision and the rationale of the Federal Court in regard to dependent claims would have significant effect on patent prosecution and the drafting of patents in Malaysia. Given that there are no express provisions in the Malaysian Patents Act 1983 to allow a patent to be amended when the validity of the patent is challenged in Court, patent holders and patent applicants are now faced with the dilemma whether to amend their patents so that each dependent claim is now drafted as an independent claim notwithstanding that this would be contrary to the accepted patent practice and patent drafting worldwide and also contrary to Regulation 14 of the Malaysian Patent Regulations 1986 which provides that “Any claim which includes all the features of one or more other claims (“dependent claims”) shall contain, if possible at the beginning, a reference to the other claim or claims and shall then state the additional features claimed”. The Federal Court appears to have overlooked the fact that dependent claims operate to narrow down the scope of the claims. Therefore, if the independent claim is invalid for lack of novelty or inventive step, the dependent claims do not automatically become invalid only by virtue of their reference to the independent claim. Each dependent claim would still need to be assessed against the available prior art that is available to determine its validity.

It would also appear that the Federal Court has adopted a very narrow reading of section 56(3) of the Malaysian Patents Act 1983 to apply only to independent claims. Further, it would be an absurdity if the Court has the power to declare some claims or parts of a claim to be invalid and yet has no power to enforce a partially valid patent.

Person skilled in the art

Is the Federal Court advocating doing away with the standard of an “unimaginative skilled addressee”? Whilst the testimony of an expert in a patent trial would assist the Court, it is our view that it should not override or substitute the applicable standard for assessment of novelty and inventive step by a person skilled in the art who is an “unimaginative skilled addressee”.

If you have any queries or if you need more information about the court decision, please do not hesitate to contact:

Ong Boo Seng, Partner

Yan Pei Chun, Patent Consultant