Sandvik Intellectual Property AB v Outokumpu OYJ and Outotec OYJ

Sandvik Intellectual Property AB (a Swedish corporation) sought revocation of South African Patent No. 2002/5826 held by Outokumpu OYJ (first respondent, a Finnish company), which was later assigned to Outotec OYJ (second respondent, also Finnish). The patent concerned a belt for thermal treatment (sintering) of a material bed in a continuously operated conveyor-type system. The patent, entitled 'Belt for the thermal treatment of a continuously operated material bed', was based on a PCT application filed on 24 January 2001, claiming priority from a Finnish patent application filed on 31 January 2000. The initial PCT application was amended after an initial search report revealed prior art and stated the invention lacked novelty and inventive step. The amended claim 1 (the key independent claim) included specifications about perforated metal elements connected to form a conveyor belt, with perforations arranged in zones alternating with perforation-free zones, and the area of perforations being 20-60% of the total conveyor belt area. Sandvik applied for revocation on grounds including lack of novelty, lack of clarity, lack of fair basis, and most importantly, lack of inventive step. The Court of the Commissioner of Patents (Makgoka J) dismissed the revocation application and certified the patent as valid.

• Whether the patent lacked an inventive step as required by sections 25(1) and (10) of the Patents Act 57 of 1978
• Whether the invention was obvious to a person skilled in the art having regard to the prior art
• What constitutes the inventive step in the patent claim
• Whether the prior art disclosed the key integers (elements) of claim 1
• Whether the onus to prove invalidity of the patent on grounds of lack of inventive step was discharged

The appeal was upheld with costs. The judgment of the Court of the Commissioner of Patents was set aside. South African Patent No. 2002/58267 was revoked. The applicant (Sandvik) was granted costs of revocation, including costs relating to the joinder application of the second respondent.

A patent lacks an inventive step and is invalid under sections 25(1) and (10) of the Patents Act 57 of 1978 where the claimed invention would be obvious to a person skilled in the art having regard to the prior art. Where prior art discloses all or substantially all the key features (integers) of a patent claim, and the only distinction is a broad range or parameter that a skilled person could readily determine or optimize, the invention does not involve an inventive step. In determining obviousness, courts must: (1) identify the inventive step claimed in the patent; (2) determine the state of the art at the priority date relevant to that step; (3) identify how the step differs from the state of the art; and (4) assess whether taking that step would be obvious to a skilled person. Patent claims define the monopoly, and advantages or objects stated in the specification but not reflected in the claims cannot be relied upon to establish inventive step. An expert witness need not have been skilled in the relevant art at the priority date of the patent to provide admissible and valuable evidence about the state of the art and obviousness.

The Court made obiter observations regarding expert evidence in patent cases, clarifying a statement in Ausplow v Northpark Trading [2011] ZASCA 123 at para 41. Navsa JA observed that the statement that an expert witness was not qualified at the effective date of the patent should not be construed as authority for the proposition that a properly qualified expert cannot assist the court merely because they were not such an expert at the priority date. This was described as not being relevant to the result in Ausplow and should not be treated as binding authority on that narrow point. The Court also made observations about the limited value of expert opinions on the ultimate question of obviousness, reiterating the approach in Schlumberger that technical evidence about the nature of the inventive step and state of the art is primary evidence, while expert conclusions about obviousness are "immaterial" though they may sometimes be difficult to avoid in testimony.

This case is significant in South African patent law for: (1) Reaffirming and applying the four-step Ensign-Bickford test for determining obviousness and lack of inventive step under sections 25(1) and (10) of the Patents Act 57 of 1978. (2) Clarifying that claims must be interpreted according to their language and that advantages or objects stated in the body of the specification cannot expand the monopoly claimed if not reflected in the claims themselves (following Electric and Musical Industries v Lissen and Power Steel Construction v African Batignolles Construction). (3) Confirming the approach to expert evidence in patent cases as set out in Schlumberger Logelco Inc v Coflexip SA 2003 (1) SA 16 (SCA), emphasizing that technical evidence about the state of the art is primary, while expert opinions on obviousness are of less value. (4) Clarifying that an expert need not have been skilled in the relevant art at the priority date to provide admissible and valuable evidence to the court. (5) Demonstrating that broad ranges or parameters in patent claims (such as the 20-60% perforation range) will not constitute an inventive step where the prior art discloses similar features and a skilled person could easily arrive at such ranges. (6) Reinforcing that the onus to prove patent invalidity rests on the applicant for revocation on a balance of probabilities. This judgment provides important guidance on how South African courts assess inventive step in patent validity challenges.