28 July 2013

‘Offended’ by Patents? Make Your Feelings Known!

ExpletiveIP Australia is seeking views on further proposed amendments to the Australian Patents Act 1990, which arise out of three enquiries into gene patents and the scope of patentable subject matter in Australia.

A consultation paper, entitled Patentable Subject Matter: Consultation on an Object Clause and an Exclusion from Patentability [PDF, 159kB], was released on 26 July 2013, and IP Australia is inviting written submissions by 27 September 2013.  While interested parties may no doubt comment on the proposals in any way they see fit, IP Australia is particularly requesting responses to three specific questions set out in the consultation paper.

The two amendments proposed in the consultation paper are to:
  1. add an ‘objects’ clause, to assist in the interpretation of the Patents Act; and
  2. introduce a new exclusion from patentability for ‘an invention the commercial exploitation of which would be wholly offensive to the ordinary reasonable and fully informed member of the Australian public’.
Both of these amendments were recommended in the report of the Advisory Council of Intellectual Property (ACIP) on its review of Patentable Subject Matter  (‘PSM Report’), published in February 2011.  The first was also proposed by the Senate Community Affairs Committee Inquiry into Gene Patents (‘SGP Report’), while a version of the second was recommended in the Australian Law Reform Commission’s report Genes and Ingenuity: Gene Patenting and Human Health (ALRC Report 99)

The Australian Government responded to all three of these reports [PDF, 145kB] in November 2011.  As I wrote at the time, the government response could have been summarised as ‘not much left to do’, with IP Australia’s efforts in progressing the Raising the Bar patent reforms, and improving its own online systems, having addressed the vast majority of recommendations in the three reports.  I identified only three substantive recommendations accepted by the government, and not yet implemented, including the two subject of the current consultation.  The third accepted recommendation, which is to modernise the language used in the Patents Act to clarify the ‘manner of manufacture’ patentability test, appears to have been dropped into the ‘too hard’ basket for now.

21 July 2013

Australia Needs to Get Into the Patent Box

BoxAustralia currently has a tax offset scheme in place to provide an incentive for companies to engage in eligible R&D activities.  The R&D Tax Incentive program provides a 45% offset (equivalent to a 150% deduction) on eligible expenditure by small to medium enterprises, and a 40% offset (equivalent to a 133% deduction) for larger organisations.

This scheme has many merits.  It is broad-based, easy to access, and is available across all industries.  However, its drawback is that it is a one-off benefit.  Once the eligible R&D is concluded, there is no further incentive to maximise the commercial outcomes available from the resulting innovations.  More specifically, there is no ongoing incentive to conduct further commercialisation activities in Australia.

Increasingly, however, other countries are providing such incentives.  Countries that have introduced so-called ‘patent box’ regimes include the UK, the Netherlands, Belgium, France, Ireland, Spain, Luxembourg, Switzerland and China.  These schemes provide reduced tax rates (typically between 5% and 15%) on income attributable to patented IP.

The US is now contemplating its own patent box scheme, with legislation (the Manufacturing Innovation in America Act of 2013 [PDF, 280kB]) introduced into the House of Representatives on 28 June 2013.

Myriad Sues Ambry, Delivers a Lesson in Patent Law

ClassroomAs has been widely reported, hot on the heels of its ‘loss’ at the US Supreme Court Myriad Genetics has sued Ambry Genetics for infringing 10 patents covering genetic testing for BRCA1 and BRCA2 genes linked to breast and ovarian cancer.

Informed coverage of the basis for Myriad’s complaint can be found, for example, on the PharmaPatents Blog, the PatentDocs Biotech and Pharma Patent Law and News Blog, and the Patently-O Blog.

I think it is fair to say that Ambry was, quite literally, asking to be sued.  It announced its intention to commence BRCA1 and BRCA2 genetic testing on the very same day (13 June 2013) that the Supreme Court handed down its decision invalidating Myriad’s claims to isolated ‘naturally occurring’ genes.  It also immediately updated its home page with graphics promoting the newly-available tests, as well as a banner showing an image of the US Supreme Court building emblazoned with the slogan ‘Your Genes Are Still Free’.

Myriad’s legal response to this provocation was, it seems to me, entirely predictable.  Anyone who has been surprised by this – particularly those who believed that the Supreme Court had somehow deprived Myriad of the ability to sue competing providers of BRCA testing – might perhaps best view these latest events as a useful lesson in the intricacies of patent law!

15 July 2013

‘Raising the Bar’ on International Applications

GlobeMuch of the focus regarding Australia’s ‘Raising the Bar’ patent reforms has been on the substantive changes to the law, such as the higher threshold for inventive step, enhanced disclosure requirements, and the new utility standard.

However, there have been a number of procedural changes, also.  These affect all Australian applications, including those filed as the national phase of an international application under the Patent Cooperation Treaty (PCT).  Indeed, since most PCT applications are prepared to meet the substantive legal standards of a range of countries, including the US and Europe, it is probable that many international applicants will not be as much concerned about the legal reforms as about the procedural changes.

Applications filed prior to 15 April 2013 are theoretically able to proceed subject to the old law.  This includes PCT applications – for which the effective Australian filing date is the international filing date.  However, this is only the case if examination was also requested prior to 15 April 2013.  An examination request cannot be validly filed on a PCT application until after it has entered the national phase in Australia.  It therefore follows that any PCT application proceeding in Australia on or after 15 April 2013 must, by definition, be subject to the law and procedures as amended by the Raising the Bar reforms (including the implementing regulations).

The Australian National Chapter of the PCT Applicant’s Guide [PDF, 65 kB] has recently been updated to reflect the procedural changes introduced by the Intellectual Property Laws (Raising the Bar) Act 2012.  This seems like a good opportunity to inform (or remind) readers of the current requirements and processes during the national phase in Australia.

12 July 2013

Nominations for the ABA Journal Blawg 100 Now Open!

MedalAs in past years, the ABA Journal (‘Law News Now’) is gearing up to create its annual list of the 100 best legal blogs (or ‘blawgs’).  This will be the seventh time the 'Blawg 100' has been compiled.

This year they are apparently getting started a little earlier, with nominations being open until 9 August 2013.

The final list is determined by ABA Journal staff and, while it is not a ‘popularity contest’, nominations are accepted in the form of ‘friend-of-the-blawg briefs’, a.k.a. the Blawg 100 Amici.

The decision to nominate a blawg is, of course, entirely personal.  But if you are a regular Patentology reader, and you find the blog interesting and useful, then I would really appreciate you putting in a good word!  Nominations can be made via the Blawg 100 Amici submission page.

07 July 2013

5 Troll-Busting Tactics the US (Mostly) Won’t Adopt

Burst BalloonThe United States does not generally seem to think that it has a great deal to learn from the rest of the world.  This is, at least, abundantly clear when it comes to patent law and the associated litigation system.

I have observed previously that patent trolls appear, so far at least, to be as American as apple pie, and more recently I have explained why I do not believe the Australian system is conducive to the success of trolls.  So you might think that if the US is serious about addressing the ‘troll problem’, it would want to look closely at what is done differently in other countries, where the problem does not exist to anything like the same degree.

Unfortunately, my own experience suggests that this is unlikely to occur.  When the proposed legislation which became the America Invents Act was being hotly debated, I found myself on an email list populated by lobbyists with a strong interest in the US intellectual property system.  These people were not lightweights, or without relevant influence in Washington, and I know for a fact that some of the documents they produced (generally opposing the legislation, and particularly the move to a first-to-file system) influenced the debate in Congress.

I was invited to join the list in the first place particularly because I could contribute an ‘outsider’ view, and provide a taste of the perspective of the 50% of users of the US patent system who are not resident in the US.  However, I soon found that my input was more often criticised, or even ridiculed, than it was given any form of respectful consideration.  Indeed, I have never received any more condescending and belittling correspondence than I did while participating in that list.  So I removed myself.

I therefore have absolutely no expectation that what follows will be seriously considered by those with the power to influence the direction of the US patent system.  But the majority of my readership is from other parts of the world.  So for those people, and the many US-based individuals who may be interested in some more radical proposals than are currently under consideration, here are the five things that I would change in the US system to try to bust the patent troll business model wide open!

06 July 2013

Federal Court Throws Self-Represented Litigant a Life-Line

Enviro Pak Pty Ltd v New Horticulture Pty Ltd [2013] FCA 306 (2 April 2013)
Enviro Pak Pty Ltd v New Horticulture Pty Ltd (No 2) [2013] FCA 624 (25 June 2013)

Enviro Pak CupIt is not common for the Federal Court of Australia to allow a corporation to be represented by a non-lawyer.  Nor is it common for the court to cede authority to an administrative decision-maker.  So when a judge of the Federal Court does both in the course of the same litigation, there is no avoiding the fact that the court is doing the beneficiary of these decisions a significant favour.

The dispute between Enviro Pak Pty Ltd and New Horticulture Pty Ltd (trading as Green Pack, which is how I shall refer to the company) relates to Australian registered design no. 304960, owned by Enviro Pak.  The registration protects the design of a corrugated paper coffee cup, which Enviro Pak claims to be unique in that the corrugations are aligned vertically, which in turn requires that the width of the corrugations increases from the bottom to the top of the cup (since the circumference of the base of the cup is smaller that that of the lip).  Notwithstanding this functional aspect of the design, it is important to keep in mind that a registered design protects only the visual appearance of the coffee cup, and not its functionality or associated benefits.

Enviro Pak is suing Green Pack, and its sole director and shareholder, for alleged infringement of the registered design.  Initially, Green Pack had legal representation, however the financial circumstances of the company appear to have resulted in termination of this representation in February 2013.  In the meantime, two applications challenging the validity of the registered design had been filed with the Designs Office at IP Australia.

While an individual (i.e. a ‘natural person’) is entitled to represent him- or herself in court, a corporation normally is not, and must be represented by a qualified legal practitioner.  Furthermore, the Designs Act 2003 is structured such that when proceedings are on-foot both in court, and at IP Australia, in relation to the same registered design, the Registrar of Designs is generally unable to proceed without permission from the court.  (The Patents Act 1990, incidentally, is similarly structured.)

This state of affairs creates potential difficulties for a party with financial limitations, once a court action has commenced.  In this case, however, the court has made exceptions for Green Pack.