Australian High Court to Rule on Obviousness

At 10.15am this coming Wednesday (2 September 2015) the Australian High Court will hand down its decision in the appeal by AstraZeneca AB against last year’s ruling, by a a special five-judge panel of the Federal Court of Australia, that its two patents relating to the cholesterol-lowering drug marketed as CRESTOR (having the active ingredient rosuvastatin) are invalid.

The decision will be significant in clarifying the law relating to obviousness in Australia.  There are potentially two questions at stake in this regard:

1. What is the appropriate ‘starting point’ for assessing whether or not a claimed invention is obvious?
2. Does the Australian law limit or prohibit ‘selection’ of a favourable prior art document from a potentially large field of candidates as a basis for finding an invention obvious?

We will soon know what the High Court thinks on these two questions.  This article provides a background on the issues before the court, and some of the arguments that it has been weighing up in coming to its decision.

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Tags: Appeal, Australia, High Court, Obviousness

Australia’s Productivity Commission to Examine ‘IP Arrangements’, but Hands Will Be Tied on Patents

The Australian Government has directed its Productivity Commission to undertake a 12 month public enquiry into the intellectual property system, including its effect ‘on investment, competition, trade, innovation and consumer welfare.’

The enquiry has been established in response to Recommendation 6 of the Competition Policy Review (a.k.a. the ‘Harper Review’) which issued its final report on 31 March this year.  The Harper Review’s recommendation stated, in relevant part, that:

The Australian Government should task the Productivity Commission to undertake an overarching review of intellectual property. …

The review should focus on: competition policy issues in intellectual property arising from new developments in technology and markets; and the principles underpinning the inclusion of intellectual property provisions in international trade agreements.

The Terms of Reference for the Productivity Commission Review into Intellectual Property Arrangements require the Commission to:

1. examine the effect of the scope and duration of protection afforded by Australia's intellectual property system on
   1. research and innovation, including freedom to build on existing innovation
   2. access to and cost of goods and services
   3. competition, trade and investment;
2. recommend changes to the current system that would improve the overall wellbeing of Australian society, which take account of Australia's international trade obligations.

The review will look at all aspects of Australia’s intellectual property system, including patent, trade mark, registered design and copyright laws and regulations.  I anticipate that copyright, in particular, will receive close scrutiny.  There are a number of aspects of Australian copyright law – including the treatment of unpublished and ‘orphan’ works, as well as issues relating to technology-neutrality – where substantive reforms may be both desirable and feasible.

Of course, my primary interest is in the patent system.  And here, in particular, the Productivity Commission will find that its hands are largely tied by Australia’s commitments under long-standing international agreements.  Options such as targeting local innovators for preferential treatment,  reducing the term of patents, limiting the scope of patentable subject matter and restricting the rights of patent-holders are all substantially off-the-table as a result of Australia’s existing international obligations.  In any case, none of these things would solve the real problem, which is the lack of an effective innovation ecosystem in Australia which can support the development of new home-grown technologies, and assist Australian innovators to take them to the world.

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Tags: Australia, Economics, Patents and society, Public policy, Reviews

Five Easy Ways to Fix the Innovation Patent System

As I reported last week, IP Australia has opened a consultation on the belated recommendation by the now-defunct Australian Advisory Council on Intellectual Property (ACIP) that the government consider abolishing the innovation patent system.

The consultation, and ACIP’s recommendation, arise as a result of IP Australia’s report entitled The Economic Impact of Innovation Patents, which concluded that the innovation patent system is failing to achieve its original objective of encouraging innovation by Australian inventors and small-to-medium enterprises (SMEs).

Specifically, IP Australia is seeking ‘feedback’ on:

1. the ACIP recommendation that the innovation patent system be abolished; and 
2. any alternative suggestions to encourage innovation among SMEs.

I believe that the concept behind the innovation patent – providing a second-tier patent right that is easier and more cost-effective for individuals and SMEs to obtain, but which has a shorter term of protection than a standard patent – is a good one, although it has become clear that the execution of that concept has left much to be desired.  However, the fact that the system is imperfect is no reason to abandon it without some attempt at revision.

With this in mind, I would like to present five simple proposals to address many of the concerns that have arisen in relation to innovation patents.  Readers familiar with recent Australian politics will be aware that nothing gets done in this country unless it can be encapsulated in a three-word slogan.  I have therefore reduced each of my proposals to a simple three-word headline:

1. Raise the Step;
2. Limit the Damages;
3. Reduce the Term;
4. Stop the Injunctions; and
5. Force the Examination.

Further explanation of each of these proposals, and the potential benefits, are set out in the remainder of this article.

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Tags: Australia, Innovation patent, Innovation policy, Law reform

IP Australia Has the Innovation Patent In Its Sights, Again!

IP Australia has initiated a consultation on the recommendation of the Advisory Council on Intellectual Property (ACIP), in its one-page statement issued in May 2015, that Australia’s second-tier ‘innovation patent’ system be abolished.  While the terms of the consultation naturally do not say it in so many words, it seems to me that IP Australia is gunning for the innovation patent, and would like to see ACIP’s latest recommendation implemented by the government.  The consultation paper is available from IP Australia’s web site, and submissions are requested by 28 September 2015.

ACIP had previously reported on a three-year review of the innovation patent system back in June 2014.  Its report that was largely inconclusive, and made no recommendation supporting either the retention or abolition of the innovation patent system.  However, as I explained in an earlier article, immediately following publication of an IP Australia report on The Economic Impact of Innovation Patents ACIP (or somebody purporting to speak for ACIP – see later) was miraculously struck by certainty, and issued its short-but-sweet revised recommendation that the Australian government should consider abolishing the innovation patent.

The IP Australia report resulted from analysis of the Intellectual Property Government Open Data (‘IPGOD’) dataset that has been compiled and made available to the public, free of charge.  The IPGOD (which presumably resides in IP Heaven, assuming such a place exists) contains over 100 years of data on IP rights applied for in Australia.  It includes information on all aspects of the application process, augmented by a unique set of identifiers enabling IP rights to be linked to individual firms and firm-level business information.  The analysis was conducted under the auspices of IP Australia’s Office of the Chief Economist, as part of its ongoing studies of the Economics of IP, and the report concludes that ‘the innovation patent is not fulfilling its policy goal of providing an incentive for Australian SMEs to innovate’.

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Tags: Australia, Innovation patent, Innovation policy, Law reform

Turf Wars! Why Owning a ‘Plant Patent’ Does Not Grant Control of the Variety Name

‘Sir Walter’ is a variety of buffalo grass that has proven to be extremely popular in Australia.  It was developed in around 1996 and is described as ‘a grass that was more resilient to disease, pests and fungus than other grasses.  It was drought resistant, thrived in shade and sun and stayed green and lush throughout the year.’

The Sir Walter variety is protected by Plant Breeder’s Rights (PBR’s), granted under the Plant Breeder’s Rights Act 1994 (the PBR Act).  Australian PBR’s perform a similar function in Australia to Plant Patents in the US.  Generally speaking, PBR’s are rights granted to the breeder of a new variety of plant that provide exclusive control over propagating materials, such as seeds, cuttings, divisions, tissue culture, and so forth, for up to 20 years (25 years in the case of trees and vines).

Protection for the Sir Walter variety under the PBR Act will expire on 27 March 2018.  Until this date, Buchanan Turf Supplies Pty Ltd (the company that owns the PBR) essentially controls all production and sale of Sir Walter turf in Australia.  After that date, other traders will be free to cultivate, reproduce and sell the Sir Walter variety in competition with Buchanan Turf Supplies.

Over the time it has had exclusive rights to the Sir Walter variety, Buchanan Turf Supplies has marketed it strongly.  It owns the Internet domain ‘sirwalter.com.au’, and had advertised through just about every applicable medium, including television, radio, print, fixed and mobile signage, and point-of-sale (i.e. nurseries).  All of this promotion has prominently featured the Sir Walter name, and educated the public as to the benefits of the variety.  Recently, Buchanan Turf Supplies has sought to register the name SIR WALTER as a trade mark.

There is just one (big) problem with this.  When used in relation to grass, ‘Sir Walter’ is not a trade mark, it is a variety name.  And while ‘a rose by any other name would smell as sweet’, we would have some difficulty conducting a conversation about the fragrance of the rose if we were unable to agree on a common name to signify the flower in question.  Which is why – as Buchanan Turf Supplies is finding out the hard way in Federal Court – you cannot ‘own’ a variety name, even if you were the one to coin it, and have effectively had control over its use for the better part of 20 years: Buchanan Turf Supplies Pty Ltd v Registrar of Trade Marks [2015] FCA 756.

A better strategy is to have two different names: one for marketing purposes; and another for the common name of the variety.

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Tags: Australia, Plant Breeder's Rights, Trademarks