Australia: Unjustified threats of patent infringement weakened by courts

Managing IP is part of Legal Benchmarking Limited, 1-2 Paris Gardens, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2026

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Australia: Unjustified threats of patent infringement weakened by courts

Australian courts have recently taken a dim view of competitors claiming that the patentee has made unjustified threats of patent infringement. It is now clear that, in relation to the assessment of damages, it is necessary for the defendant to show any threats made by the patentee were directly the cause of loss or damage to the defendant.

In Mizzi Family Holdings Pty Ltd v Morellini (No 3) [2017] FCA 870, damages relating to the unjustified threats were at issue. Mizzi held a patent for a sugar cane planting machine and sued Morellini for infringement. At first instance, it was found that Morellini's machine did not infringe the patent and that Mizzi had made unjustified threats of patent infringement. (It was later found on appeal that Mizzi's patent was invalid for false suggestion.) Mizzi had caused advertisements to be placed in trade journals, warning off potential customers of being in patent "infringement danger" if they were to buy competitive machinery to that disclosed in Mizzi's patent application.

In light of a recent precedent, Morellini needed to establish causation between the threats and the damages claimed. The judge refused to find any liability even though customers did not want to take up the defendant's machine, and "they were a bit cautious because they were waiting for all this to be over". Although the judge accepted a general reluctance to deal with the invention, there was no finding that the reluctance was attributable to any threats.

The net effect of this decision is that it establishes the need for evidence of actual causation between the threat of patent infringement and the resulting loss by the potential competitor. This is good news for patent holders but sets a high threshold for those wishing to invoke the unjustified threat ground in dealings with a patentee.

Peter Treloar

Shelston IP

Level 21, 60 Margaret Street

Sydney NSW 2000, Australia

Tel: +61 2 9777 1111

Fax: +61 2 9241 4666

email@shelstonip.com

www.shelstonip.com

more from across site and SHARED ros bottom lb

More from across our site

IP specialists Jonathan Moss and Jessie Bowhill, who worked on cases concerning bitcoin, Ed Sheeran, and the Getty v Stability AI dispute, received the KC nod
Hannah Brown, an active AIPPI member, argues that DEI commitments must be backed up with actions, not just words
A ruling in the Kodak v Fujifilm dispute and a win for Google were among the major recent developments
Nick Aries and Elizabeth Louca at Bird & Bird unpick the legal questions raised by a very public social media spat concerning the ‘Brooklyn Beckham’ trademark
Michael Conway, who joined Birketts after nearly two decades at an IP boutique, says he was intrigued by the challenge of joining a general practice firm
The private-equity-backed firm said hires from DLA Piper and Eversheds Sutherland will help it become the IP partner of choice for innovative businesses
The acquisition is expected to help Clorox bolster its position in the health and hygiene consumer products market
AIPPI, which has faced boycott threats over the 2027 World Congress, says it has a long-standing commitment to engagement and geographic rotation
The shortlist for our annual Americas Awards will be published next month, with potential winners in more than 90 categories set to be revealed
News of Nokia signing a licensing deal with a Chinese automaker and Linklaters appointing a new head of tech and IP were also among the top talking points
Gift this article