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Cortex - Life Sciences Insights

| 4 minutes read

If it Ain’t Broke, Don’t Fix it: The Repair Defence in Australian Patent Litigation

The quintessential right of a patentee is to exclusively exploit their invention (and authorise others to do so) during the term of the patent.  In Australia, this provides a patentee with the exclusive right to make, hire, sell, use, import or otherwise dispose of the patented product.  If another person does any of these actions without the patentee’s consent, it is likely to infringe the patent.  However, patentees and exclusive licensees of patented products, such as medical devices, consumer goods, or other devices or equipment, should be aware that, in Australia, the right to repair patented goods operates as a defence to patent infringement.  The effect of this defence is that the purchaser of a patented product is entitled to maintain the product in good repair, either by repairing it themselves or engaging someone else to do so, but the purchaser is not entitled to remake the product (and thereby infringe the patent) under the guise of repair.

Australian courts have only grappled with the application of this defence a few times, including in Calidad Pty Ltd v Seiko Epson Corporation (2020) 272 CLR 351 (Calidad) (see our previous articles here and here) and, more recently, in MMD Design and Consultancy Limited v Camco Engineering Pty Ltd [2023] FCA 827 (Camco).  In this article, we explore the law surrounding the repair defence in Australian patent litigation and consider how the different outcomes reached in these two cases reveal the fact-specific nature of the defence.

The Repair Defence in Australia

The right of a purchaser to keep a patented product in good repair is a residual right possessed by all individuals; the right does not arise from any express or implied licence acquired by purchasing the product.  The question is whether the alleged infringer has engaged in permissible repair or impermissible manufacture of a new product.

Answering this question requires reference to the integers of the claim(s) in question.  In Calidad, at [66], the High Court of Australia clarified that where what has been done by an alleged infringer does not involve the replication of the combination of integers that define the invention, it cannot be said that what has been done is the impermissible making of the patented product.  One formula that has been used is to ask whether the actions taken to repair the patented product result in the original product ceasing to exist at any stage during the repair process (see Calidad at [67]; Camco at [415]; and United Wire Ltd v Screen Repair Services (Scotland) Ltd [2001] RPC 24 at [73]).  As Rofe J held in the recent decision of Camco, at [406], if a mere component of the patented product remains from which a new product is created, there will be an impermissible making.

Recent Examples of the Repair Defence in Action

Where an alleged infringing act falls on the continuum between repair and manufacture is a question of fact and degree in any given case.  To that end, recent Australian case law provides useful examples of how the application of the above principles can lead to differing outcomes.

In Camco, the patent related to a tooth construction for a mineral sizer (a piece of equipment used in mining to crush rocks), and the applicant alleged that the respondent (Camco) had infringed the patent through the unauthorised supply of its own tooth constructions.  Camco claimed that owners of the applicant’s mineral sizers had a right of repair, and Camco had undertaken the repair work as their agent.  As the Court ultimately found that Camco had not infringed the patent, there was no need to consider whether its products were used to repair the applicant’s products. Nonetheless, the Court did so: Justice Rofe held that once Camco had removed parts of the tooth construction during the repair process, all that remained was a mere component of the original product; the patented tooth construction had ceased to exist.  When Camco then replaced these parts with new parts, it had effectively unmade the patented product and made a new tooth construction.  As a result, Camco had replicated the integers of the relevant claim and engaged in impermissible manufacture (see Camco at [408]-[426]).  As the repair defence would not have been made out, had Camco been found to infringe, the defence would not have assisted.

This finding can be contrasted with the decision in Calidad.  In Calidad, the patentee manufactured and sold single use printer ink cartridges that embodied inventions claimed in two of its patents.  A third party obtained used cartridges and modified them in a way that permitted their refill and reuse.  Calidad (the alleged infringer) then imported these cartridges into Australia and sold them.  A majority of the High Court concluded that this did not amount to an impermissible manufacture (see Calidad at [67], [69] and [112]).  In the majority’s opinion, the modifications made to the cartridges (which included creating and sealing two small holes in the printing material container, and replacing or reprogramming the memory chip) did not result in the cartridge ceasing to exist, and did not result in the product having been unmade and then remade.  The modifications did not involve the replication of features or integers of the invention claimed.

Key Takeaways

These two cases illustrate the fact-specific nature of the Court’s enquiry when considering the repair defence in Australian patent litigation.  In particular, they emphasise the need to carefully consider the specific product and the alleged infringement, in light of the specific integers of the claim(s) in question, to ascertain whether what has been done amounts to permissible repair or impermissible manufacture.  Potential litigants should be aware of this nuanced distinction, and the implications of the facts of their specific case, when there is a possibility an alleged infringer will raise the repair defence.