This is the second article in our two-part series examining the Full Court's decision in Nalco Company v Cytec Industries Inc [2026] FCAFC 72.

In Part 1, we considered the first substantive issue before the Full Court, namely the appeal from Cytec Industries Inc v Nalco Company [2021] FCA 970 (the 2021 Decision), in which the primary judge held that the claims then under consideration failed to satisfy the support and sufficiency requirements of the Patents Act 1990 (Cth).

This article considers the second substantive issue, namely whether the primary judge erred in Cytec Industries Inc v Nalco Company (No 4) [2024] FCA 1318 (the 2024 Amendment Decision) by refusing Nalco leave to amend the patent application under s 105(1A) of the Patents Act.

Although the Full Court upheld the primary judge's findings regarding support and sufficiency in the 2021 Decision, it nevertheless allowed the appeal from the 2024 Amendment Decision, permitted the proposed amendments, and ordered that the amended patent application proceed to grant.

Relevant legislation

Before turning to the Court's reasoning, it is useful to outline the relevant statutory provisions.

Section 105(1A) of the Patents Act provides:

‍If an appeal is made to the Federal Court against a decision or direction of the Commissioner in relation to a patent application, the Federal Court may, on the application of the applicant for the patent, by order direct the amendment of the patent request or the complete specification in the manner specified in the order.‍

Section 105(4) further provides:
A court is not to direct an amendment that is not allowable under section 102.

Relevantly, s 102(1) provides that:
An amendment of a complete specification is not allowable if, as a result of the amendment, the specification would claim or disclose matter that extends beyond that disclosed in the complete specification as filed.

Further s 102(2) and (2A) provide that:
An amendment of a complete specification is not allowable after the specification has been accepted if, as a result of the amendment a claim of the specification would not in substance fall within the scope of the claims of the specification before amendment; or relevantly in the present case, the specification would not comply with the support and sufficiency requirements of subsections 40(2) or (3).

The 2024 Amendment Decision

Following the 2021 Decision, Nalco sought leave under s 105(1A) of the Patents Act to further amend its patent application. The proposed amendments were directed to addressing the claim construction adopted in the 2021 Decision, which had resulted in the claims being found to lack support and sufficient disclosure.

Claim 1, in the form sought by the amendment application, provided as follows (deleted text identified by [ ]):

‍A method for the reduction or aluminosilicate containing scale in a Bayer process comprising the steps of:

adding to the Bayer process stream an aluminosilicate scale inhibiting amount of a composition comprising [at least one] small molecules [is selected from the group consisting of compounds:]

() through (IX), (XXVIII) [(XIII), (XV)] through (XXX) and (XXXII) [through (XLVII), (LIII) through (LVIII) and (LX)]

within a product mixture formed from the reaction of [a)] hexane diamine, [ethylene diamine or 1-amino-2-propanol; b)] 3-glycdixoypropyltrimethoxysilane; and [c)] 2-ethylhexyl glycidyl ether…

Nalco also sought to replace dependent claims 2 - 16 with four independent claims in substantially the same form as amended claim 1.

Nalco by its amendment application sought to narrow the language of claim 1 by removing the phrase “at least one” and “selected from”.

As discussed in Part 1, the primary judge in the 2021 Decision construed the claim as including within its scope a composition comprising only one small molecule selected from the group. Further, it was found that the specification did not identify the performance of any particular small molecule in isolation, nor did it teach how to produce a reaction product mixture consisting only of one of the claimed small molecules. Accordingly, the claims were held to lack support under s 40(3), and the specification was found not to satisfy the sufficiency requirement in s 40(2)(a).

Nalco argued that the proposed amendments addressed those issues. Further, Nalco submitted that the amended claims were now directed to a complex reaction product mixture formed from the reaction of three specified reactants. According to Nalco, the identified small molecules were required to be present within that reaction product mixture, but the claims did not require the mixture to consist only of those molecules. That is, the product mixture will include many other small molecules and polymers in addition to each of the listed small molecules in the particular claim.

Nalco also placed emphasis on the words "within" and "formed". Nalco submitted that these are ordinary English words which, in context, mean "inside or in" and "produced", respectively. Accordingly, a person skilled in the art would understand that the claims require these small molecules to be in a product mixture that has been produced by the reaction of the three reactants, and the claims do not include within their scope a product mixture that contains only the small molecules listed.

On the contrary, Cytec contended that the amended claims define an invention which includes within its scope compositions comprising only the particular small molecules identified and nothing else. Cytec relied on the findings made in the 2021 Decision that the complete specification does not identify or describe beneficial effects of any particular small molecules, or how to produce a reaction product mixture that contains only those small molecules.

The primary judge substantially accepted Cytec's submissions. As such, his Honour concluded that Nalco's amendment application did not overcome the deficiencies identified in the 2021 Decision. In particular, he found that the specification still failed to disclose the invention in a manner that was clear and complete enough for it to be performed by a person skilled in the art, contrary to s 40(2)(a). His Honour also held that the amended claims were not supported by the matter disclosed in the specification, contrary to s 40(3). Accordingly, the primary judge concluded that the proposed amendments were not allowable under s 102(2) and therefore the amendments application was refused.

The Full Court’s Decision

Nalco appealed from the 2024 Amendment Decision, contending that the primary judge erred in refusing leave to amend the patent application under s 105(1A).

The appeal raised two principal issues. First, whether the proposed amended claims, properly construed, overcame the support and sufficiency deficiencies identified in the 2021 Decision and therefore satisfied the allowability requirements in ss 102 and 105(4) of the Patents Act. Secondly, if the amendments were allowable, whether the Court should exercise its discretion to permit the amendments under s 105(1A).

Allowability of amendments under s 102

By majority (Beach and Jackman JJ; Jackson J dissenting), the Full Court allowed the appeal. The majority held that the primary judge had adopted an incorrect construction of the proposed amended claims.

The majority held that the amended claims did not encompass a product mixture consisting only of the identified small molecules. Rather, the claims were directed to a complex product mixture containing the listed small molecules together with other small molecules and polymers.

Accordingly, the amended claims no longer encompassed the embodiments that gave rise to the support and sufficiency deficiencies identified in the 2021 Decision.

The Court therefore concluded that the amended claims complied with ss 40(2)(a) and 40(3), and that the proposed amendments satisfied the allowability requirements in ss 102 and 105(4).

Discretion of the Court to direct the amendment under s 105

Having concluded that the amendments were allowable, the Court then considered whether it should exercise its discretion under s 105(1A).

Cytec contended that the Court should nevertheless refuse leave, principally on the basis of unreasonable delay by Nalco and an alleged failure to make full and frank disclosure.

The essence of Cytec’s delay argument was that Nalco had long known of the “single small molecule” issue ultimately identified in the 2021 Decision, but deliberately chose not to amend its claims. Cytec relied on evidence that, by at least 2016, Nalco understood that the reaction products were a complex mixture, that the specification provided no information as to how to make any single specific chemical compound, and that the claims may be vulnerable for lack of support and sufficiency ([764]–[766]).

Cytec further alleged that Nalco adopted a “deliberate delay strategy” in 2018 by delaying the filing of amendments introducing the “product mixture” limitation until after Cytec had served its reply evidence and submissions. Cytec contended that this minimised its opportunity to address the amended claims and avoid further evidentiary scrutiny ([772]–[786]).

Cytec also argued that Nalco had failed to make full and frank disclosure by not candidly explaining the reasons for the delay. It relied on correspondence suggesting that the amendments had already been settled but that this was not disclosed to the Commissioner ([778]–[781]). Cytec further argued that Nalco did not proactively explain the circumstances surrounding the delay and only produced evidence from Dr Dixon after the issue was raised ([794]).

Cytec also relied on evidence that, by September 2020, Nalco's advisers believed that the “single small molecule” argument was a key issue in the case and raised a material risk of invalidity”, yet Nalco did not make any contingent amendment application addressing those vulnerabilities as a fall-back position and elected to defend the existing application and wait for the Court to determine the issue before seeking further amendments ([798], [802]). Cytec characterised this as a deliberate "risk” and “reward" strategy, whereby Nalco sought to retain the benefit of broader claims and only sought narrower claims after the broader claims had been found invalid ([803]).

The majority rejected these submissions. The Full Court concluded that Nalco had not unreasonably delayed seeking amendment, had provided full and frank disclosure, and that there were no strong discretionary grounds against allowing the amendments. Conversely, there were positive discretionary considerations favouring amendment because the amendments removed the lawful grounds of objection identified by the primary judge.

Principles relevant to the exercise of discretion under s 105(1A)

In reaching its decision, the Full Court identified a number of principles relevant to the exercise of the Court’s discretion to direct amendment of a patent application under s 105(1A) of the Patents Act 1990 (Cth). These principles provide guidance on the factors to be considered when determining whether an otherwise allowable amendment should be permitted.

• There is no limitation as to the point in time during an appeal at which an amendment application can be made or determined or the relevant amendment power exercised. The timing of an amendment application is relevant only to whether the discretion should be exercised, not whether the Court has power to direct the amendment ([482], [483]).
• The considerations relevant to the exercise of discretion under s 105(1) in relation to amendment of a patent application may differ from those applicable to a granted patent ([484]).
• S 105(1A) does not specify any other factors a court should take into account when considering whether to direct the amendment of a patent application besides allowability of the amendment under s 102. Accordingly, the primary consideration in exercising its discretion under s 105(1A) is whether the proposed amendments remove lawful grounds of objection. This is consistent with the reason for introducing s 105(1A), which is to reduce the complexity of the pre-grant process by empowering the Court to deal with amendment applications in an appeal from the Commissioner’s decision. ([490]–[494])
• Relevant considerations to the Court’s exercise of discretion include knowledge of the risk of potential difficulties, whether there has been full and frank disclosure and, unfair advantage and delay ([495]–[496]).
• Delay will only be relevant where it relates to the amendments sought and the applicant’s knowledge of the need for those amendments. A delay in seeking earlier amendments directed to different issues will not justify refusing leave under s 105(1A). The relevant question is whether the applicant had actual or objective awareness of the need for the amendments ultimately sought ([817]–[823]).
• An applicant is not required to anticipate every possible ground of invalidity or amend pre-emptively. Where an applicant has reasonable grounds for maintaining its construction of the claims and considers amendments unnecessary, it is entitled to advance and test that position ([837], [846]–[847]).
• An applicant is not required to propose multiple hypothetical fallback amendments for the Court’s consideration. Such an approach would be inconsistent with the purpose and operation of the s 105(1A) provision ([838]–[839]).
• Full and frank disclosure requires disclosure of the relevant circumstances surrounding the amendment application, but does not require an explanation of every document, communication or decision ([848]–[854]).

If you would like further information about this decision, or in relation to rules governing the allowability of amendments to Australian patents and patent applications, please contact Daniel McKinley or Dr Catrina Olivera.