Breakthrough Mining Innovator Globaltech wins AU Patent Battle against Market Leader Reflex

Reflex Instruments Asia Pacific Pty Ltd v Globaltech Corporation Pty Ltd [2023]FCAFC 158

An Australian Court has found in favour of Globaltech which solved a mining problem with an elegant solution. An important lesson from this decision is that driving IP innovation can be central to maintaining a market-leading position.

Globaltech initiated infringement proceedings against Reflex in 2019 on its Australian standard patent [AU2012297564] entitled “Optical device for use with downhole equipment” for use in mining.  Reflex ultimately conceded infringement but cross claimed alleging the patent was invalid.

In brief, the broadest claims of the invention relate to a device that transfers an electromagnetic signal along downhole equipment to an electronics unit.  The device comprises a mechanism that causes the electromagnetic signal to change its direction of travel such that it is transmitted through the side wall of the downhole equipment.  This new feature allows for the information transmitted to be obtained without uncoupling the electronics unit from the main assembly, thus saving time and minimising damage to the device.

In July 2022, Justice Jagot at first instance, ruled in favour of Globaltech, finding that the patent was both novel and inventive.  Reflex appealed on six grounds, including contesting the findings of novelty and inventive step.

The Full Court decision was handed down on 29 September 2023.  Although Reflex was successful on one ground relating to claim construction, the Full Court upheld the primary judge’s decision, upholding the validity of the Globaltech patent.

Reflex had disputed Justice Jago’s conclusion there was no perceived problem with uncoupling, as Reflex hadn’t attempted to address it before the priority date.  Reflex explained that they didn’t address the issue at the time because their tool had a dominant market position and was working well, so there was no need to fix it.  The Full Court sided with Jagot J – just because someone skilled in the field didn’t see a problem doesn’t mean that identifying a problem and proposing a solution is obvious.  Improving the existing downhole equipment design with a side communication port was therefore upheld to be non-obvious at the priority date.

This case represents a timely reminder to both market leaders and disruptors.  Dominant players in a market should not become complacent and assume that they will always maintain a market-leading share.  Re-evaluating market position in connection with understanding opportunities to drive IP innovation should be a regular occurrence.  On the other hand, disruptive innovators should consider the possibility of enhancing existing technologies and pursuing patent protection for those enhancements.  However, it is important to be mindful of the potential risks of undertaking such a strategy.  Assessing infringement risk, also known as Freedom to Operate (FTO), will be key in that context.

About Pearce IP

Pearce IP is a boutique firm offering intellectual property specialist lawyers, patent attorneys and trade mark attorneys to the life sciences industries (in particular, pharmaceutical, biopharmaceutical, biotech, ag-tech and food tech).  Pearce IP is the 2021 ‘Intellectual Property Team of the Year’ (Lawyers Weekly Australian Law Awards) and was shortlisted for the same award in 2022.  Pearce IP is ranked in IAM Patent 1000 and Managing IP (MIP) IP Stars, in Australasian Lawyer 5 Star Awards as a ‘5 Star’ firm, and the Legal 500 APAC Guide for Intellectual Property.

Our leaders have been recognised in virtually every notable IP listing for their legal, patent and trade mark excellence including: IAM Patent 1000, IAM Strategy 300, MIP IP Stars, Doyles Guide, WIPR Leaders, 5 Star IP Lawyers, Best Lawyers, and Australasian Lawyer 5 Star Awards, and have been honoured with many awards including Australian Law Awards – IP Partner of the Year, Women in Law Awards – Partner of the Year, Women in Business Law Awards – Patent Lawyer of the Year (Asia Pacific), Most Influential Lawyers (Changemaker), among other awards.