Sect. 119 of the Australian Patents Act 1990 (Cth) (the “Patents Act”) provides a ‘prior use’ defence to patent infringement (for patents granted on applications filed on or after 28 September 2006), which allows a third party who was utilizing the patented product or process before the priority date of a claim to continue using the patented product without infringement. This may occur in situations where the third party had obtained the subject matter of the invention from information that became publicly available with the patent owner’s consent in prescribed circumstances. Such circumstances include, for example, disclosure to a recognised learned society or at a recognised international exhibition.
The prior use defence is limited to prior use of the invention (or definite steps in preparation to use it) in Australia, which it makes clear that the defence is not available to parties that can only show prior use of the invention overseas.
The Patents Act includes a broad definition of the term ‘exploit’ and uses this to define the conduct in respect of which the defence may be applied. The Patents Act also grants prior users the right to dispose (in whole but not in part) of their entitlement to exploit claimed inventions without infringing. This recognises the fact that parties who develop technology will not necessarily commercialise the technology themselves, but may choose to assign rights to technologies to another party.