Australian Patent Attorneys Urged to Get More Ethics Training

Revised guidelines for Continuing Professional Education (CPE) issued on 28 November 2012 by the Professional Standards Board for Patent and Trade Marks Attorneys (and soon to appear on the Board's web site) require registered practitioners to undertake a minimum of one hour of ethics or professional conduct CPE in each year.  Currently, the minimum total CPE requirement is 10 hours for practitioners registered as either patent attorneys or trade marks attorneys, and 15 hours for practitioners registered as both.

While one hour per year may not seem like much, this is a significant step for the profession, both practically and symbolically.

Part of the background to the new guideline is a recent decision of the Disciplinary Tribunal, which found a senior Australian patent practitioner (now retired) guilty of unsatisfactory professional conduct, for failing to resolve a conflict of interest between two clients of his Adelaide firm, both of which had developed directly competing inventions.  We reported on this decision back in April this year (see Senior Patent Attorney Found Guilty of ‘Unsatisfactory Conduct’).

One consequence of the Tribunal's decision was to turn a spotlight on the lack of agreement amongst patent and trade marks attorneys in Australia as to exactly how and when conflicts arise, and how they should be identified and resolved.  The Professional Standards Board provided evidence of one senior member of the profession who testified to his opinion that the practitioner's firm was clearly in a conflict situation at least from the time that one of the clients discovered, and complained about, the firm’s acting for the other client in August 2007.  However, two other senior members of the profession provided completely contrary evidence on behalf of the practitioner!

Pharma Patents Review Releases Issues Paper, Launches Blog

On 21 November 2012 the Australian Government’s Pharmaceutical Patents Review panel released a ‘Background and Suggested Issues Paper’ [PDF, 609kB], which outlines the panel’s initial impressions of the key issues for the review.  This review was originally announced by the Parliamentary Secretary for Industry and Innovation, Mark Dreyfus QC, on 15 October 2012 (see Yet Another Patent System Review – Pharmaceutical Patents).

According to the panel’s announcement, the paper seeks to ‘begin engaging with anyone who has an interest in this area [i.e. pharmaceutical patents] and to provide a stimulus for written submissions.’

The paper includes a number of specific questions, however it is said said that these are intended only to provide ideas for developing submissions.  The panel is seeking a broad spectrum of views, and does not want anyone to feel constrained by its suggested questions!

There are two aspects of the announcement which we find quite interesting, at least from our own personal perspective.  Firstly, the review does not merely have a web page – as is now absolutely standard – but has set it up as a blog at pharmapatentsreview.govspace.gov.au.  The panel intends to use the blog to explore the relevant issues with stakeholders, and interested parties will be able to interact directly with the panel throughout the review process by commenting on individual posts (including the announcement of the issues paper itself).

Secondly, Patentology’s article Pharmaceutical Extensions of Term: Is It Time for a Fix? is cited in the issues paper (footnote 20), which came as a pleasant surprise!

Written submissions are due by 5pm on 21 January 2013.  This is actually quite a tight deadline, considering that the month between Christmas and the end of January is the main summer vacation period for many Australian stakeholders.

The Australian Apple/Samsung 2013 Year Planner is Here!

With 2012 drawing to a close, Patentology is pleased to announce the availability of the Australian Apple/Samsung 2013 year planner.

This handy reference is an absolute must-have for the wall or desktop of numerous Australian IP lawyers, patent attorneys, Federal Court employees, tech journalists, patent litigation enthusiasts and – of course – Federal Court Justice Annabelle Bennett.

Justice Bennett recently timetabled a number of new hearing dates in the second half of 2013, bringing the total number of court days set down next year in the Australian Apple v Samsung case to 123.  Yes, you did read that correctly – one hundred and twenty-three.  This is in addition to the 46 days of hearings which will have taken place by the end of this year, not including last year’s interlocutory proceedings, and various dates that have been set down for administrative purposes (e.g. management conferences and directions).

Our 2013 year planner – a larger version of which is available by clicking on the thumbnail above – should therefore prove invaluable to to the many individuals involved in this gargantuan case.  It will help senior counsel to organise the expenditure of their substantial fees on European sojourns during the northern summer, while less-experienced articled clerks and junior associates will be able to plan when they might be able to grab a few hours of sleep, or invest a little time in any surviving relationships they may have outside of work!

It does not appear that any of the dates that have been reserved by Justice Bennett are speculative, or merely for contingency.  By all accounts, she has been meticulous in time-tabling the trial, and every set of dates is scheduled for hearing of a specific aspect of the case.

SMEs – You and IP Australia Need to Talk!

A contingent of key staff from IP Australia, led by Director General Philip Noonan, is currently engaged in a tour of mainland capital cities, where they have been consulting with members of the IP professions on the draft amendments to the Australian Patents Regulations 1991, which are open for comment until 21 November 2012 (see Draft Regulations Reveal Applicants to be Slugged with Search Fee and Timeframes Slashed in Second Stage of Proposed Regulations).  We were fortunate to have the opportunity to attend the Melbourne discussion on Wednesday, 14 November 2012.

A small but highly-engaged contingent of about 20 patent attorneys, trade marks attorneys and lawyers attended either one, or both, of the two 90 minute sessions.  The format was basically a ‘round table’ discussion (though the actual table was rectangular), which ranged across a number of the issues raised by the draft regulations.  The IP Australia representatives generally seemed receptive to the various views expressed by the participants, and equally willing to explain and defend their position on the proposed regulations.  It is fair to say that there was fairly robust discussion on a small number of the more contentious issues!

The Australian IP law reforms, and the accompanying amendments to the regulatory regimes, encompass trade marks, designs and copyright matters, as well as changes to the regulations governing the patent and trade marks attorney professions.  However our interest, as always, is primarily in relation to the patent reforms.

In this article, we cover a few of the topics discussed.  However, we wish to highlight particularly the potential impact of the proposed search and examination fee regime on Australian small-to-medium enterprises (SMEs).  While there are certainly people within the patent profession who will be advocating a rethink of this regime, on behalf of our local SME clients, it is equally important that SMEs ensure that their own voices are heard directly.  Otherwise, there is a real risk that some Australian SMEs will be effectively priced-out of their own patent system!

Patent Pools – Some Not-So-Frequently Answered Questions

In our previous article, Fragmented Patent Pools Will Not End Smartphone ‘Wars’, we wrote about two separate initiatives intended to make patent licences more easily available, and affordable, for companies wishing to implement standard mobile communications technology.

These initiatives are known as ‘patent pools’.  This is not a new concept, and the notion of companies ‘banding together’ to share access to patented technologies, sometimes with anticompetitive effects, has existed for well over a century.

However, the contemporary structure of patent pools, generally intended to facilitate access to patents required to implement an industry standard or some other widely-desired technology, is a relatively recent development.  Modern pool operators are mindful of the anticompetitive potential of patent pools, and are careful to establish legal structures and agreements which do not fall foul of competition or antitrust laws and regulators.

Patent pool arrangements began to gain official sanction from competition regulators back in the 1990s.  In 1995, the US Department of Justice (DoJ) and the Federal Trade Commission (FTC) issued the Antitrust Guidelines for the Licensing of Intellectual Property (PDF, 230 kB), which highlighted the potential pro-competitive benefits of pools.  On 26 June 1997, the DoJ Antitrust Division issued a Business Review Letter in response to a request by the MPEG LA group, which was proposing to establish a pool to license patents essential to the implementation of the MPEG-2 digital video coding standards, which were in the process of being widely adopted for a range of commercial applications, including DVD-video, digital video transmission and broadcast, and digital video recording and storage.

The DoJ gave its stamp of approval to the proposed MPEG LA pool arrangements, and these have become a template for subsequent patent pools seeking to avoid violating antitrust and unfair competition laws.

While the idea of pooling patents seems simple, there are a number of subtleties that are perhaps not so readily appreciated.  With this in mind, we ask and answer a few basic questions about modern patent pooling arrangements.

Fragmented Patent Pools Will Not End Smartphone ‘Wars’

Depending on where you are in the (developed) world, the next generation of mobile communications networks is either already with you, or on its way.  Colloquially known as ‘4G’, it is more accurately termed ‘LTE-Advanced’, an upgrade from the Long Term Evolution (LTE), or ‘3G’ technology which is now widespread.  LTE-A is an improvement in every respect over 3G – higher peak data rates, greater spectral efficiency, reduced latency and increased throughput.

And, of course, there are more patents than ever before covering networks and devices capable of communicating using the full range of available standards.

Considering that the holders of patents covering the previous generation technologies seem unable, or unwilling, to resolve their existing disputes over access and licensing terms for access to standards-essential patents (SEPs), it may be difficult to imagine how there could ever be peace as the number of such patents – and associated patent holders – only seems to be increasing.

The creation of ‘patent pools’ – collections of SEPs owned by multiple proprietors, and made available as a block via a single licence agreement – may therefore be seen as an encouraging sign.  Two such pools have recently been established covering subsets of the LTE SEPs.  And while we would like to think that this is the beginning of a more peaceful coexistence among competitors in the mobile communications space, a closer look at the LTE patent landscape suggests that there is a long way to go before these pools will represent a realistic option for achieving a truce in the industry.

South Korea is Not a ‘FRAND Rogue State’!

On 24 August 2012, the Seoul Central District Court issued its decision in one of the many ongoing patent cases between rivals Apple and Samsung.  We did not report on the ruling at the time because, frankly, there was very little information available in English, and we therefore did not feel that there was anything much we could add to the news reports (such as this one, from Bloomberg).

Overall, while the decision produced a rare win for Samsung, things certainly did not all go the way of the Korean company.  Of four patents which it asserted against Apple, two were found invalid, and one was found not to be infringed.  Furthermore, Apple was successful in a counterclaim, which resulted in injunctions against various Samsung products, and an award of 25 million Korean won (about US$23,000) in damages.

Samsung’s single valid and infringed patent also earned it an injunction against a number of Apple’s 3G-capable devices, and a damages award of 40 million won (about US$35,000).

One widely-read commentator, however, was willing to infer a great deal from very little.  Florian Mueller, in a FOSS Patents blog post entitled ‘Apple-Samsung ruling suggests South Korea is a FRAND rogue state’, wrote:

A couple of court decisions announced in Seoul, South Korea, this morning indicate that South Korea has decided to become a rogue state in connection with standard-essential patents, essentially telling foreign companies that in order to sell their technology products to the country's 50-million population, they must bow to extortion by Samsung and LG.

This is highly problematic and will have diplomatic repercussions. The victims of such abuse will be companies from the United States, Europe and Japan, and increasingly also Chinese companies. I don't know what Apple is going to do, but it would make sense to talk to both U.S. presidential candidates at the earliest opportunity.

So far, we are unaware of any credible allegations of ‘extortion’ having been made against any Korean companies, or of any diplomatic repercussions, or indeed of any impact on the US presidential race now drawing to a conclusion!

However, this week we have come into possession of a full English translation of the Media Report issued by the Seoul Court on 24 August in relation to its ruling on the Samsung patents, and we have to say it makes very interesting reading, with none of the hallmarks you might expect of a document issued by a ‘rogue state’.

The translation was prepared by Korean IP law firm Lee & Ko (which acted as cousel for Samsung in the case), and was circulated to delegates who had attended the AIPPI Congress in Seoul on 20-23 October 2012.  Lee & Ko have kindly provided their permission for Patentology to make the translation available in full, and it can now be viewed and/or downloaded from Google Drive.  The following is a summary of the Court's main points and reasons.

Is IP Australia Ready to ‘Raise the Bar’?

IP Australia has temporarily suspended its practice of case management of divisional applications, which was introduced in October 2010 (see IP Australia Gets Tougher on Patent Applicants and IP Australia’s ‘Case Management’ of Divisional Applications).

The purpose of this practice has been to limit abuses of the system by expediting examination of divisional applications, and providing only a limited (two month) response period if any objection is raised which is substantially the same as an objection raised in the parent case (or other ancestor).  This prevents applicants from using divisional applications to achieve a form of ‘continued prosecution’, whereby an application is kept pending without making any meaningful progress towards acceptance.

According to a directive published in Section 2.10.11 of the Australian Patent Manual of Practice & Procedure, examiners are now to:

1. discontinue the practice of reducing the response time frame for divisional applications on which an objection is raised in the first report for the same or substantially the same reason as an objection was raised in the report on the parent or other ancestor, … . Where a first report has already been issued with a reduced response time frame, examination should proceed in accordance with the case management approach and reduced response time frames can continue to be used at further report stage where appropriate; and
2. discontinue the expediting of divisional applications as a matter of routine and accord them the same priority as other examination work.

We have no official (or unofficial) information regarding the reasons for this abrupt change of practice, however we suspect that it may be due to an actual, or anticipated, rise in the number of examination requests generally being received by the Patent Office.  And the reason the rate of examination requests can be expected to rise – perhaps dramatically – is because any pending application for which a request for examination has not been made by 15 April 2013 will be subject to the more stringent standards of patentability established by the Raising the Bar Act 2012.

We wonder… is IP Australia ready for this?

Ecuador Goes It Alone With Massive Fee Hikes

Possibly not too many people will care about this, but Ecuador appears determined to assure itself of a place at the bottom of the heap when it comes to innovation, if upcoming changes to official fees are anything to go by.

First, a hat-tip – we are grateful to fellow patent attorney Eddie Walker, of FB Rice, for bringing the Ecuadorian fee changes to our attention.  Ecuador is not a country that would normally capture the attention of this blog, however these fee hikes are so outrageously disproportionate to… well… anything, really, that we cannot resist sharing them!  But on a more serious note, there are also some observations that may be worth making about the role of IP in developing nations, and why Ecuador’s approach is potentially antithetical to the country’s interests.

In a nutshell, any day now the official fees payable to the Ecuadorian Patent and Trademark Office (PTO) in respect of various patent services will rise by up to 3629%!  No, that is not a typo, and a decimal point has not been inadvertently omitted.  The final year patent maintenance fee is indeed slated to rise by a factor of over 36 times, from US$572 to US$20,760.07.  By comparison, the basic application fee will increase by a mere 697%, from US$404 to US$2,816.13.

On the positive side, discounts of up to 90% will be available for certain classes of applicants, namely small and medium-sized companies, universities acknowledged in Ecuador, independent inventors, public institutions, small and medium-sized farmers, and cooperative companies.  In other words, everybody but the foreign companies, multinational corporations and large local companies that are most able to afford to conduct R&D, introduce new products and service, and drive innovation in a developing country such as Ecuador.

Developing nations are inevitably net importers of new technology, innovation, skills and enterprise.  There is no value in reinventing the wheel – or anything else, for that matter – and it is far better to provide incentives for foreign investment, including robust patent protections, R&D tax benefits and so forth.  With good management, the country can then build its own domestic capabilities and industries off the back of this initial bootstrapping.

Ecuador, however, seems determined to give foreign investors every reason to look elsewhere for development opportunities.

A Tour of IP Australia’s Latest Online Service Offerings

As of 29 October 2012, IP Australia has launched the second release of its eServices online portal.  The initial release, back at the end of April, enabled users to renew all IP rights (patents, trade marks, designs and plant breeder’s rights), to submit trademark registrations electronically, and to pay online by credit card (VISA or MasterCard).  The eServices portal also enables users to save requests, access a transaction history and update personal/contact details.  We reported the initial release in IP Australia Launches eServices Portal.

For patent applicants/owners, the second release of eServices adds the following transactions:

1. patent applications (including examination requests, postponement of acceptance and selected amendment types);
2. PCT National Phase Entry requests;
3. multi-year patent renewals; and
4. patent examination requests.

Non-patent transactions included in this release are:

1. trade mark applications;
2. TM Headstart (including Part 1, Amendments and Part 2);
3. design applications (including requests for registration, examination and publication); and
4. Plant Breeder's Rights Applications (Part 1).

Aside from expanding and simplifying IP Australia’s online services, there are two significant consequences which will flow from this eServices release, at least for patent applicants:

1. it is now highly likely that online filing will become the ‘approved means’ for transactions from 1 December 2012, meaning that higher fees will be payable if applications are filed by any other means (such as fax or mail); and
2. filing of standard patents online, in order to ensure payment of the lower fee, requires that entitlement details be available at filing.

This second point may catch some applicants unawares, particularly foreign applicants (or their agents), who are accustomed to being able to provide details of the basis for ownership of the invention and related rights much later in the examination process.

This article provides a quick tour of the new online services, and further explanation of the two issues noted above.