Bending Light Ltd, Re

Restoration of a lapsed patent under section 28(3) of the Patents Act 1977 requires the proprietor to show that it took reasonable care to secure payment of the renewal fee and any additional fee within the prescribed period. Impecuniosity is relevant but not conclusive. A proprietor must show both a genuine intention to pay and reasonable care to ensure that it was in a position to pay. Where the financial evidence is complicated, the proprietor bears a substantial burden of explanation. Deliberately using available funds for other liabilities, while knowing the renewal deadline and the consequences of non-payment, does not satisfy the statutory test.

Bending Light Limited appealed against a Patent Office decision refusing restoration of patent GB 2 342 726. The seventh-year renewal fee fell due on 15 September 2004 and was not paid during the statutory six-month grace period, so the patent lapsed on 15 March 2005. An application for restoration was made within the period allowed by rule 41(1)(a) of the Patents Rules 1995.

The company relied on financial difficulties following the death of a key executive and argued that it lacked funds to pay the renewal fee. The central issue was whether the company had taken reasonable care within section 28(3) of the Patents Act 1977.

1. Appeal dismissed. The Hearing Officer had correctly refused restoration.
2. Under section 28(3) of the Patents Act 1977, restoration is mandatory only if the Comptroller is satisfied that the proprietor took reasonable care to secure payment of the renewal fee and any prescribed additional fee within the relevant period.
3. The court applied the approach in Continental Manufacturing & Sales Inc.’s Patent [1994] RPC 535: reasonable care is assessed by reference to the particular proprietor acting reasonably in ensuring payment. The statutory words require no wider or more artificial definition.
4. Following Ament’s Application [1994] RPC 647, inability to pay is not conclusive. A proprietor who intended to pay must also show that the inability to pay did not result from a failure to take reasonable care, including reasonable care to remain in a position to pay. Where the financial circumstances are complicated, the burden of proof is heavy.
5. Bending Light had not established that it lacked the means to pay. The evidence indicated that funds were available near the final deadline, while other liabilities were paid or treated as priorities. The company knew the deadline and consciously chose not to pay the patent fees. That decision, however commercially understandable, was not reasonable care within section 28(3).

High Court (Patents Court): appeal from the decision of the Hearing Officer acting for the Comptroller, dated 30 January 2008. The appeal was dismissed.