19 September 2018

How Can an Innovative National IP Office Balance Its Roles as Technology Examiner and Technology Developer?

BalancingIP Australia incorporates the Australian Patent, Trade Marks, Designs, and Plant Breeder’s Rights (PBR) Offices, the core ‘business’ of which is to provide services to their ‘customers’ in respect of the administration and registration of Australian IP rights.  Indeed, IP Australia may be seen as a significant ‘exporter’ of such services considering that, for example, over 90% of applicants for Australian patent rights are foreign residents, as are over 50% of applicants for design registrations and PBRs.  In respect of its core services, IP Australia holds a true monopoly – no other government or private sector service provider can grant, or otherwise administer, enforceable IP rights in Australia.  IP Australia operates these services on a cost-recovery basis, i.e. it aims to fully recover the costs of service-provision through the official fees that it charges to its ‘customers’.

The scare quotes around the business-oriented terminology in the opening paragraph reflect my scepticism of the fashion for modelling government service provision as a form of business enterprise.  I am not alone in this scepticism.  Writing in the Harvard Business Review last year, Canadian business and management expert Henry Mintzberg noted that ‘[r]unning government like a business has been tried again and again, only to fail again and again’.  He also called the portrayal of citizens as customers a ‘misguided, overworked metaphor’, going on to observe:

Business is essential – in its place. So is government, in its place. The place of business is in the competitive marketplace, to supply us with goods and services. The place of government, aside from protecting us from threats, is to help keep that marketplace competitive and responsible.

Consistently with Mintzberg’s view on the appropriate role of government, IP Australia has a single Outcome under the Australian Government’s budget and accountability framework, which is:

Increased innovation, investment and trade in Australia, and by Australians overseas, through the administration of the registrable intellectual property rights system, promoting public awareness and industry engagement, and advising government.

Recently, however, we have seen IP Australia extending its services into areas that are, arguably, beyond this core mission, and engaging in activities in which it – again, arguably – positions itself in competition with private enterprise.  Examples include:
  1. the TM Headstart service and Trade Mark Assist tool which, despite disclaimers that they are not substitutes for legal advice, compete directly with services provided by trade marks practitioners; and
  2. the Patent Analytics Hub, which provides analysis, visualisation and interpretation of patent data, and competes directly with various patent search and analytics service providers, albeit ‘only’ for clients in the government and public research sectors – which actually includes some of the largest potential customers for these services in Australia.
Additionally, as I noted just last week, IP Australia is now engaged in its own internal IT development projects, applying machine learning techniques to patent classification and assessment of trade mark applications.  Its Chief Data Officer was also quoted last week by the online IT news outlet ZDNet, speaking on IP Australia’s efforts in relation to improving its business intelligence and analytics capabilities through internal ‘agile’ software development projects.

Just to be clear, I am not saying that all – or any – of this is necessarily a ‘bad’ thing.  IP Australia may, indeed, be the best-placed agency to be delivering these projects.  And, as I also pointed out in my article last week, it has by any standards – public or private sector – demonstrated over the past few years an impressive capability to deliver IT projects in a timely and cost-effective manner.  Certainly, IP Australia is not the only IP authority in the world to be engaging in such activities, with materials from the World Intellectual Property Organization (WIPO) May 2018 Meeting of Intellectual Property Offices (IPOs) on ICT Strategies and Artificial Intelligence (AI) for IP Administration revealing various projects ongoing at WIPO, the European Patent Office, the Russian Patent Office (Rospatent), the German Patent and Trade Mark Office, and others.

Even so, there is an argument to be made that IP Australia, as the agency responsible for regulation of registered IP practitioners (i.e. Australian patent and trade marks attorneys) is, at the same time, competing with those practitioners, albeit in a very limited capacity.  Furthermore, as the agency responsible for examining and registering (or refusing) IP rights in relation to new inventions – including software-based and machine learning technologies – IP Australia is also now itself engaged in developing such technologies.  This raises the question of whether any conflicts of interest arise as a result?  And, if so, what is the nature of those conflicts, and how should they be managed?

11 September 2018

Computerised Decision-Making – Coming Soon to an IP Office Near You?

Malevolent robotThe Intellectual Property Laws Amendment (Productivity Commission Response Part 1 and Other Measures) Act 2018 (the ‘PC Part 1 Act’) received Royal Assent, and thus passed into law, on 24 August 2018.  Following an initial consultation, which confirmed (in case any confirmation was required) that the proposal to abolish the innovation patent system remained controversial, it had an easy passage through the two houses of the Australian Parliament after the corresponding provisions were dropped from the Bill at the eleventh hour.  (These same provisions have since been incorporated into the draft of the Intellectual Property Laws Amendment Bill (Productivity Commission Response Part 2 and Other Measures) Bill 2018.) 

The PC Part 1 Act implements a number of less-contentious recommendations made by the Productivity Commission in its 2016 Report into its inquiry into Australia’s intellectual property arrangements, including clarifications on the legality of parallel imports, reducing the initial period before a registered trade mark may be challenged on grounds of ‘non-use’, and reducing reporting obligations relating to pharmaceutical patents with an extended term.  The Act also implements a number of measures that have been on IP Australia’s policy agenda for a while, most of which are intended to streamline and align the administration of the Australian IP system and make ‘technical amendments’ to correct or clarify IP legislation.

Included among the ‘streamlining’ measures are provisions to enable the Commissioner of Patents, and the Registrars of Trade Marks, Designs, and Plant Breeder’s Rights ‘to arrange for a computer program under their control to make decisions, exercise powers, and comply with obligations under the legislation’, i.e. to permit computerised decision-making.  When this idea was originally proposed in a public consultation process conducted in June-July of 2015, it was described as the ‘expanded use of automated systems’, and would have required the Regulations to prescribe specific decisions that may be automated.  The small number (three) of submissions received on this proposal were generally positive, but all noted the important role of the Regulations in controlling, and/or keeping the public informed, of the types of decisions that might be computerised.

However, three years is an eternity when it comes to progress of digital technologies, and with advances in machine learning and other techniques, the range of decisions that might presently, or in the near future, be wholly or partly automated has expanded greatly since the initial consultation in 2015.  The provisions that have actually been enacted (and which came into effect immediately upon receiving Royal Assent, i.e. on 24 August 2018) include no requirement for Regulations to be made permitting the automation of particular decisions.  Going forward, therefore, any decision, or related action, under the Patents, Trade Marks, Designs, or Plant Breeder’s Rights Acts may be automated using a computer program, if/when the relevant Commissioner or Registrar considers it appropriate.  The legislation has been drafted such that this may include both procedural actions (e.g. allowing an extension of time when no objections have been raised) and substantive actions (e.g. preparing an issuing examination reports).

While it might seem unlikely that computers will be examining patent applications any time soon, a submission made by IP Australia to the World Intellectual Property Organization (WIPO) prior to a meeting of international IP Offices held in May 2018 indicates that fully or partially automated trade mark examination – at least at the stage of an initial report – may be much closer to reality.

In any event, the necessary legislative permission is now in-place to enable any part of IP Australia’s decision-making processes to be automated, and an increase in the removal of human beings from the day-to-day execution of routine tasks that perhaps do not require high levels of adaptability and/or creativity is most likely now inevitable.  Fortunately, the legislation includes provisions that will make it easy for a computerised decision to be ‘overruled’ by a human decision-maker.  Furthermore, both computer and human decisions may be appealed to the Administrative Appeals Tribunal.

To find out more about how this will all work – and what IP Australia is up to in automating trade mark examination – please read on.

05 September 2018

Data on Patent Office Decisions Highlights Impact of Law Reforms, and Continuing Problems with Law on Patent-Eligibility

Latest dataSince commencement of the Patents Act 1990 in 1991, up until the end of August 2018, the Australian Patent Office has issued 1,851 published decisions (including, in earlier years, decisions relating to applications filed under the 1952 Act but issued under the transitional provisions of the 1990 Act).  Of these, decisions on substantive oppositions to the grant of standard patents have been by far the most common (666 in total).  Indeed, the vast majority of Patent Office decisions relate in one way or another to opposition proceedings, with the next most-frequent being procedural matters associated with oppositions (including decisions on costs, and final decisions following applicant amendments), and decisions on extensions of time to serve/file evidence.

Analysis of decisions issued by the Patent Office over time also highlights the impact of changes in law and practice, including the effect of amendments to the rules governing the grant of extensions of time in patent oppositions which came into effect with the Raising the Bar reforms in 2013.  The rate at which substantive opposition decisions, and decisions on extensions of time to file evidence, have issued since this time are consistent with other data indicating that the reforms have been effective in improving the efficiency of patent opposition proceedings.

Even more remarkable, however, is what the data reveals about the effect of recent changes in practice and case law relating to patent-eligibility of ‘contentious’ subject matter, and in particular of computer-implemented inventions.  Since 21 July 2010, when the Patent Office issued its decision in Invention Pathways Pty Ltd [2010] APO 10, there has been a total of 53 published decisions relating to examination objections asserting that the claimed inventions were not for patent-eligible subject matter (i.e. a ‘manner of manufacture’ under Australian law).  As I have noted on a number of occasions (most recently in Continuing Hostility to Computer Implemented Inventions Lands the Commissioner of Patents in Court. Again. Twice. and Computer-Implemented Inventions and the ‘Ball Point Pen Principle’ – Why the Australian Law on Patent-Eligibility is a Mess), the vast majority of these decisions have upheld the examiners’ objections, resulting in the applications being refused. 

What is even more remarkable about this, however, is that the number of such decisions over just the past eight years is more than double the grand total of just 21 decisions issued over the entirety of the preceding 19 years in relation to all available grounds of examination objection.  Furthermore, 38 of those 53 decisions have been handed down just within the past three calendar years.

As I have said before (e.g. in …Why the Australian Law on Patent-Eligibility is a Mess, linked above), this recent high incidence of applicants taking examination objections to hearings is a bad sign for the state of Australian patent law in relation to subject-matter eligibility.  The large number of decisions is bringing less, rather than more, clarity to the law, reflecting a high level of uncertainty, and a widespread lack of agreement among patent applicants, attorneys, examiners, hearing officers, and judges as to exactly what the law is – or should be – in this area.  And this uncertainty is not good for innovation and investment in digital technologies, because where there is uncertainty around the availability of IP protection, investors can have no confidence in either the ability to defend their own IP position, or of having freedom-to-operate in the relevant technical space.  Uncertainty thus discourages investment, and in this sense works directly against the incentive that the patent system is intended to provide.

28 August 2018

‘Innovation’ Drops From the Agenda as Yet Another Sitting Australian Prime Minister Given the Boot

Et tu BruteLast week, Australia got a new Prime Minister, with former Treasurer Scott Morrison replacing former lawyer, investment banker, tech investor, and republican Malcolm Turnbull.  However, lest any foreigners, hermits, or future historians who have perhaps stumbled upon this article in the National Library’s Pandora Archive, assume that this is a sign of a robust democracy recognising the will of the people, I should point out that it was not as a result of a general election, but of internal sniping and fighting within a governing party.  As many readers will be aware, this is now ‘normal’ in Australia – the last elected Prime Minister to actually lead their party to a subsequent election was John Howard in 2007.  Since then, we have had just three further elections, but five changes of Prime Minister.

In September 2015, when Turnbull deposed Tony Abbott as Prime Minister of Australia, a wave of positive sentiment swept through Australia’s innovation community – among which I count the many entrepreneurs, scientists, researchers, technologists, investors, and associated professional services providers (including patent attorneys) whom I encountered at various meetings, events, and seminars during those heady early days of the Turnbull Government.  The reason for this was partly because many of those people viewed Malcolm Turnbull as a kindred spirit, with personal, hands-on experience as an investor in technology businesses, and a generally progressive and positive attitude towards science, technology, and innovation.  Additionally, Turnbull’s first major policy announcement was of an investment of A$1.1 billion over four years in a ‘national innovation and science agenda’, in which he called for an ‘ideas boom’ to replace the ‘mining boom’ (and, more generally, Australia’s reliance on primary industry for exports), and declared his desire to see a cultural shift to embrace risk-taking, and destigmatise failure.

Ah… halcyon days!

Over less than three years, however, most of that initial positive energy has dissipated, to be replaced with disillusionment and disappointment, as talk of innovation at the top levels of government petered out to little more than a whisper.  And now, with the change in ‘leadership’ (I use the word advisedly), it seems that ‘innovation’ is completely off the agenda.  In particular, in announcing his new Cabinet, Prime Minister Scott Morrison has ditched the word entirely, with Karen Andrews being appointed Minister for Industry, Science and Technology (which presumably means that the Department formerly known as Industry, Innovation and Science is to be similarly renamed), and former Minister for Jobs and Innovation, Michaelia Cash, now appointed as Minister for Small and Family Business, Skills and Vocational Education.

So how did this happen?  How did ‘innovation’ go from a A$1.1 billion policy imperative to being a dirty word in government in under three years?

21 August 2018

Changes at IP Australia, as DG Patricia Kelly Retires From an Illustrious Career in Service of Science, Technology and Innovation

Patricia Kelly and Michael SchwagerAs recently announced by IP Australia, on 10 August 2018 its (now former) Director General, Patricia Kelly, retired from the Australian Public Service after a career spanning 38 years.  She will be replaced by Michael Schwager, another career public servant with a long association with Australian industry, innovation, and science portfolios, and whose current role is as acting Chief Operating Officer at the Commonwealth Scientific and Industrial Research Organisation (CSIRO) – which, as it happens, was Australia’s leading filer of new provisional patent applications in 2017.  He is expected to commence in the role next month.

An article on the public sector news and commentary site The Mandarin is effusive in its praise of Patricia’s achievements over the past five years at IP Australia.  And while I have no doubt that she would be among the first to disclaim complete responsibility for the authority’s recent IT successes (the eServices online portal was, for example, originally launched in April 2012, prior to her commencement), the fact is that she has overseen the bulk of what is almost certainly the most successful digital transformation program in Australian government history.  In the context of an embarrassing litany of failures by other official bodies, IP Australia recently received a global award – shared with high-profile private enterprises PayPal, Foxtel and Vodaphone UK, against over 1000 other entrants – for its efforts to become the country’s first fully-digital government agency.  Considering that less than five years ago the vast majority of Australian patent applications were still filed on paper (or, in a pinch, via facsimile), this is an astonishing achievement.

From my perspective, I would particularly commend Patricia on her fearless commitment to openness and engagement with the wider community.  Whereas, for example, the previous leadership appeared to prefer ‘preaching to the choir’, and was overtly antipathetic towards engaging via social media, IP Australia under Patricia Kelly has embraced social media and – based on my own experience – welcomed critical opinions with, if anything, greater enthusiasm than assenting ones.  Patricia and I have certainly not always seen eye-to-eye, but what we have in common is a desire for the Australian IP system, and the benefits that it provides to Australia, to be the best they can possibly be.  In working towards this goal, her administration has actively sought input from a diverse range of interested and informed stakeholders across the political, social, and commercial spectrum.  I hope that this aspect of Patricia’s legacy will be sustained under the new leadership.

Patricia Kelly came to IP Australia with impeccable credentials in science, research, innovation and industry.  From 2004 to 2013 she had served on the Committee for the Governments Co-operative Research Centres (CRC) program.  From 2006 to 2013 she chaired the Audit Committee of the department known variously through this period as the Department of Industry, Tourism and Resources, the Department of Innovation, Industry, Science and Research, and the Department of Industry, Innovation, Science, Research and Tertiary Education (and now just the Department of Industry, Innovation and Science, within which IP Australia is itself situated).  Additionally, from 2006 to 2008 Patricia was a member of the Council of the University of Technology Sydney (UTS), and in 2008 she was a member of the Review Panel of the National Innovation System.  She also led Australia's bid to host the Square Kilometre Array (SKA) radiotelescope and was a founding member of the Board of the International SKA Organisation.

In appointing Michael Schwager as Patricia’s replacement, the Government appears to have recognised the clear benefits of having the role occupied by someone with a background in industry, science, and innovation, and who has every reason to embrace continuing progress at IP Australia.  According to his LinkedIn profile, Michael has a long history with the Department of Industry, in its various incarnations, dating back to at least the mid-1990s.  From 2000-2005 he was General Manager, Technology, Manufacturing and Service Industries at Invest Australia – at the time, the Government’s inward investment agency.  He has since held various positions at the Department of Industry, Innovation and Science, where his responsibilities have included engagement with the pharmaceutical and biotechnology industries, the small business sector, the US and Canadian education, science, research and innovation systems, and heading up Innovation Programmes at AusIndustry.  Prior to his current acting position at CSIRO, Michael was most recently the Department’s Chief Operating Officer.

I therefore think that there is every reason to expect a smooth transition at IP Australia, and a continuation of Patricia’s positive achievements. 

On a personal note, Patricia has been a regular reader and supporter of this blog, as well as an occasional commenter, throughout her time as Director General, for which I am grateful.  I wish her a long and fulfilling retirement.

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