06 April 2020

COVID-19 Pandemic Yet to Bite Australian and New Zealand Patent Filings – But It’s Just a Matter of Time

VirusDespite the huge economic and social impact of the COVID-19 pandemic, the latest data shows that there has yet to be any significant change in rates of filing of patent applications in either Australia or New Zealand, compared with the same period in the past two years.  In fact, the only notable change in filing patterns in the first quarter of calendar year 2020 was not a decrease in applications, but an increase!  Specifically, the number of innovation patent applications filed using the service of patent attorneys appeared to spike briefly, by about 50%, coincident with the news that the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019 had become law.

Other than this, however, it has been ‘business as usual’ up until the end of March 2020 for filings of standard and provisional applications in Australia and New Zealand, while self-filing applicants have continued to do their thing across all categories of application (including innovation patents).  Overall, the rate of standard application filings, including national phase entries (NPE) of international applications filed under the Patent Cooperation Treaty (PCT), in both Australia and New Zealand look to be on par with the first quarters of 2018 and 2019.  Provisional filings in Australia appear to be slightly down on the past two years, although there is no evidence of this being due to any effect of COVID-19.

None of this is greatly surprising.  The real impact of the global pandemic, with the introduction of restrictions, lockdowns, and shuttering of businesses in developed nations – including Australia and New Zealand – did not really start to hit until the beginning of March.  Most non-provisional patent filings are based on priority applications filed up to 12 months previously, or PCT applications typically filed between 18 and 31 months prior.  The incremental cost of these filings is relatively low, and applicants have not yet had time to assess the repercussions of the current crisis and make adjustments to their filing budgets and strategies.  Meanwhile, work on originating applications for new inventions, i.e. the majority of provisionals, filed in March would have commenced well before the seriousness of the COVID-19 pandemic became apparent.

But I expect that it may be only a matter of weeks before the crisis starts to manifest itself in patent filing rates.  As such, the data set out in this article might best be viewed as a baseline, i.e. a snapshot of what we might regard as ‘normal’ before the global economic downturn starts to take effect.

31 March 2020

Why it is Unlikely that the Australian Government Will Invoke Crown Use Provisions in COVID-19 Crisis

CrownOn 19 March 2020, Australia’s Shadow Minister for Employment, Industry, Science and Small Business, Brendan O’Connor, wrote to his counterpart, Industry Minister Karen Andrews, to ask if the government had ‘explored how Crown use of patents may be invoked, particularly for urgent manufacturing of supplies such as facial masks’.  While the country’s response to the ongoing coronavirus pandemic has been, for the most part, blessedly free of blatant political point-scoring, this action appears to have been a rare exception.  Fortunately – though not surprisingly, considering the esoteric nature of the topic – the media mostly ignored O’Connor’s primarily self-promoting announcement. 


One exception to the media silence was InnovationAus, which was happy enough to bumble ineptly through an effort to explain what it was all about, stating that ‘[u]nder the Patents Act, the federal government can use intellectual property without the permission of the copyright owner and does not have to obtain permission or provide compensation during a national emergency.’  Setting aside the tediously common confusion between patents, copyrights, and other forms of IP, this statement is also wrong in asserting that a national emergency excuses the government from providing compensation.  One thing the article does get right, however, is to note that the Crown use provisions of the Australian Patents Act 1990 have ‘virtually never been used before’.  And I do not really expect that to change in the foreseeable future.

Somewhat ironically, in this context, the name ‘coronavirus’ derives from the appearance of such viruses, which have a characteristic ‘fringe’ of rounded or petal shaped projections – reminiscent of the solar corona, the name of which is itself derived from the Latin ‘corona’, meaning ‘wreath’ or ‘crown’.  But no matter how linguistically apposite it might be to invoke Crown use in the fight against the SAR-CoV-2 coronavirus, and the disease COVID-19 that it causes, this is unlikely to happen.  The reason for this is that, in practice, there are at least three circumstances that would need to combine before the government would have any basis to engage ‘emergency’ Crown use provisions:
  1. there would have to be a patent or pending application, in Australia, covering a product required for the country’s response to the COVID-19 pandemic;
  2. the owner of the patent/application would need to be unwilling to meet the requirement by supplying the product itself, and/or by voluntarily licensing other manufacturers or importers to do so; and
  3. for the emergency provisions to apply, the requirement would also need to be so urgent that there was insufficient time for the government to engage in any discussions with the owner to secure the required supplies of the product.
The following discussion relates to the new Crown use provisions that only recently came into effect, on 27 February 2020.

22 March 2020

Interactive Map: New Zealand Patent Applicants, 2017-2019

NZ Map PinIn my two previous articles I looked at patent activity in New Zealand: firstly, filing trends by domestic and foreign applicants over the past two decades; and secondly, leading patent applicants, recipients, and attorney firms in 2019.  While the data shows that patent filings by New Zealand residents have been in decline, I was curious to see how the domestic applicants that have still been using the system in recent years are distributed, geographically, around the country. 

By searching via the online patent search system provided by the Intellectual Property Office of New Zealand (IPONZ), it is possible to obtain tables of results that include addresses of applicants.  Usually these are physical addresses, although they can be distinct postal addresses (e.g. a post office box) or, more rarely, an ‘address for service’ such as a patent attorney or law firm.  Even so, in the vast majority of cases, the address returned is either an accurate representation of the applicant’s location, or a fairly good approximation to it.  I used the Google Maps Geocoding API to convert addresses into coordinates (i.e. latitude and longitude), and then into an interactive map using the Google Maps JavaScript API.

I am not sufficiently familiar with the geography and demographics of New Zealand to comment in the data with any authority.  However, it is fairly obvious (and unsurprising) that there is more activity on the North Island than the South, and that the highest densities of applicants and applications arise in the main centres of population and economic activity, i.e. Auckland and Wellington on the North Island, and Christchurch on the South Island.

20 March 2020

US Companies Dominate NZ Patent Applications and Grants in 2019

NZ ThumbprintIn my previous article I looked at data on New Zealand patent filings and grants over the past 20 years.  The news was not great for domestic innovation, with the number of applications filed by New Zealanders in 2019 being more than 50% below peak levels achieved back in the early 2000s.  Over the same period, the proportion of US applicants each year rose from around 35% to nearly 45%.  It is therefore not surprising that US companies feature prominently in a list of the top applicants for New Zealand patents in 2019, making up 11 of the top 20.  By contrast, Auckland UniServices Ltd is the only New Zealand resident in the top 20, and this is only on the strength of a relatively large number of provisional applications.

Considering only trans-Tasman (i.e. Australian and New Zealand) applicants, the leader by a considerable margin in 2019 was Australia’s ResMed Pty Ltd.  And while New Zealanders featured strongly among those trans-Tasman applicants that filed six or more applications in 2019, this was again largely based on provisional filings.  The top seven trans-Tasman non-provisional applicants – collectively responsible for 132 filings – were all Australian.

Looking at grants, the top recipient of New Zealand patents in 2019 was Australian (ResMed again), while the remainder of the top 10 was made up of eight US companies and one Swedish company.

The leading patent attorney firm for New Zealand filings was A J Park, which filed a sufficient number of New Zealand applications to displace Madderns from the top 10 list of trans-Tasman attorney firms on a combined count of Australian and New Zealand patent filings.

18 March 2020

New Zealand Patent Filing Data Shows a Two-Decade Decline in Applications by Domestic Residents

NZ FlagSince 24 February 2017, patent attorneys in Australia and New Zealand have been subject to a single regulatory regime, under which there is no such thing as an ‘Australian’ or ‘New Zealand’ patent attorney.  Rather, we are all ‘Trans-Tasman’ patent attorneys, qualified and registered to practice in both countries.  Looking just at Australian patent filings, as I have up until now, therefore provides only a partial picture of the market in which trans-Tasman attorneys operate.  However, I am now able to analyse New Zealand patent information, using data sourced from the online patent search system provided by the Intellectual Property Office of New Zealand (IPONZ).

Of course, Australia and New Zealand are separate countries, with their own distinct governments, policies, laws, and economies.  The behaviour of patent applicants in each country is obviously more strongly influenced by these factors than by the regulation of the patent attorney profession!  There is, accordingly, no reason to expect that filing patterns in New Zealand should mirror those in Australia, and in fact they do not.  I have previously bemoaned stagnation in patent filings by Australian residents, and the poor outcomes achieved by self-represented applicants.  However, it turns out that the situation is even worse in New Zealand, where filings by domestic applicants have been in serious decline for most of the past two decades, and a larger proportion of applications are filed without professional assistance.  Between 2005 and 2019, the proportion of non-provisional New Zealand patent applications filed by New Zealanders fell from around 15% to less than 6%, while in 2019 nearly a third of provisional applications and over a sixth of non-provisional applications made by domestic applicants were self-filed.

At the same time, foreign residents – most particularly from the US, but also from Australia – have become proportionately larger users of the New Zealand patent system.  Overall, and in contrast with global trends, there has been no growth in New Zealand patent filings over the past two decades, and New Zealanders have become ever more minor users of their own national patent system.

27 February 2020

Countdown to the End of the Innovation Patent: Abolition Legislation Signed into Law

Like sands through the hourglassOn 26 February 2020, the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Bill 2019 received Royal Assent (i.e. was signed into law by the Governor General of Australia), becoming Act No. 9 of 2020.  I reported passing of this Bill in the Senate, with amendments, in November last year, noting that its passage through the House of Representatives (which eventually occurred on 5 February 2020) was a mere formality.  The full text of the Bill, as passed, can be found on the Parliament of Australia website, and should soon be available as the Intellectual Property Laws Amendment (Productivity Commission Response Part 2 and Other Measures) Act 2020 on the Federal Register of Legislation.

The main feature of the Act, about which I have written a number of times over the past few years, with varying degrees of ambivalence, is the abolition of Australia’s second-tier innovation patent system.  I briefly reviewed the history of the innovation patent’s downfall when reporting passage of the Bill through the Senate, and will not rehash this here.  The key point to note, however, is that the legislation provides for an 18 month window, commencing on the date of Royal Assent, before the phase-out of the innovation patent begins.  The following timeline has therefore now been established:
  1. 26 February 2020 – Act receives Royal Assent;
  2. 26 August 2021 – no longer possible to file new innovation patent applications, other than divisional applications based on applications filed on or before 25 August 2021; and
  3. 25 August 2029 – final expiry date of all innovation patents (i.e. eight years after the last possible filing date of 25 August 2021).
The Bill originally provided a 12-month sunset period, however this was extended to 18 months by amendments in the Senate proposed by the Labor opposition, along with provisions requiring that a statutory review be undertaken to assess the impact on Australian small to medium enterprises of abolishing the innovation patent system, and make recommendations to facilitate access to standard patent protection for small business in Australia.  The review must commence within three months (i.e. by 26 May 2020), and provide a written report to the Minister for Industry, Science and Technology (currently the Hon Karen Andrews MP) within 12 months of commencement (i.e. no later than 26 May 2021).

To assist people with keeping track of the time remaining to file new innovation patents, I have added a countdown timer to the sidebar of this blog.  (You’re welcome!)  Notably, because 2020 is a leap year, and the Act received Royal Assent prior to 29 February and during daylight savings time, everyone has 25 hours more than would otherwise have been the case to file their final innovation patent applications!

While abolition of the innovation patent is, for most people, the big ticket item in the Act, it introduces a few other changes to Australia’s IP laws.  Read on for a brief summary of these.

17 February 2020

New Practices Arise, as Over 20% of Australian and New Zealand Patent Attorneys Change Jobs in Just Two Years

DoorsI have been writing about upheavals in the trans-Tasman patent attorney profession for a number of years now, including: the public listing of IP firms; the acquisition of firms by the listed groups; regulation of the profession in response to changes in ownership structures; the demise of long-standing brands such as Fisher Adams Kelly Callinans, Cullens and Watermark; mergers and acquisitions among the listed groups; shifts in market preferences in favour of smaller, privately-held firms; and a legal stoush over the alleged breach of restraint clauses by two former partners of a listed group firm.  It has certainly been an eventful period for the profession!

For the most part, my analysis has focused on developments at corporate and firm level, such as how listed group firms are faring compared to privately-held firms, or how larger firms are performing relative to smaller firms.  And while there is no lack of upheaval among IP firms in the Australian and New Zealand markets, when I drill down to the level of individual attorneys, the rate of staff turnover seems quite remarkable. 

I have performed an analysis of the movements of individual registered trans-Tasman patent attorneys over a 25-month period, and found that during this time just over 200 attorneys have changed jobs.  This may not sound like many, but because the patent attorney profession is small, it actually represents nearly 22% of all attorneys.  To put this in perspective, the most recent National Profile of Solicitors, published by the Law Society of NSW, put the number of members of the legal profession in Australia at 76,303 in October 2018.  Thus if lawyers had been churning over at the same rate as patent attorneys over the past two years, that would be over 16,500 people moving to new jobs!  By way of further comparison, a recent long-term study of a cohort of US lawyers found that 35% had changed jobs over the decade between 2006 and 2016, i.e. a period five times as long as that covered by my data.

A significant proportion of the turnover of attorneys has been into new practices.  There are now 47 pre-existing attorneys, and five recently-registered entrants to the profession, working in patent practices that did not exist in January 2018.  A few of these are practices that have been established within existing legal or other advisory firms.  The majority, however, are new micro practices comprising three attorneys or fewer.  In particular, there are now 22 more solo practitioners than there were at the start of 2018.  Whether you regard this as a strengthening of competition, or a worrying fragmentation of the profession, probably depends upon your point of view.  (I am pessimistically inclined to the latter interpretation.)

A number of the newly-emerging practices have made a solid start in terms of Australian patent filings, with four making it in to the top 50 firms for total filings over calendar year 2019.

12 February 2020

IP Australia Proposes Minor Fee Changes, Major Changes to Opposition and Other Hearing Costs Awards

Balancing the booksJust prior to Christmas, IP Australia announced that it is seeking feedback on its draft Cost Recovery Implementation Statement (CRIS), which outlines proposed fee changes that would take effect from October 2020.  It is also taking the opportunity to review the hearing costs that may be awarded for Patents, Trade Marks and Designs.  The public consultation process closes this Sunday, 16 February 2020.  In this article I will look briefly at proposed fee changes in relation to patents, none of which strike me as unreasonable or contentious.  I am, however, more concerned about proposed increases in the costs that may be awarded in relation to contested hearings, and most particularly patent oppositions.

IP Australia conducts its regulatory role in administering Australia’s system of registered rights (patents, trade marks, designs, and plant breeder’s rights) on a cost recovery basis, i.e. it seeks to cover the costs of these aspects of its activities from the fees charged to users of the system (which these days, for better or worse, it calls ‘customers’).  To do this, it uses various financial and economic systems and models to forecast expected demand and cost of service delivery, and reviews and adjusts fees on this basis every few years.  IP Australia last undertook a fee review in the 2015-16 financial year.

Cost recovery does not require each individual fee to reflect the cost of the nominally associated service.  The fee for requesting examination of a standard patent, for example, is (and will remain, under the proposed fee structure) A$490, which doubtless falls far short of the actual cost of examining an application.  Patent maintenance fees, on the other hand, correspond with minimal and highly automated administrative tasks, and currently rise as high as A$2550 annually, for pharmaceutical patents extended beyond the standard 20 year term.  This reflects the fact that fee setting can serve broader policy purposes, such as providing an incentive for patentees not to maintain patents that no longer hold corresponding commercial value, thus freeing up the patented technology for public use.

Costs in contested hearings, on the other hand, have nothing to do with the operations of IP Australia.  They are amounts, set by regulation, that can be awarded by designated officers of IP Australia against unsuccessful parties in administrative proceedings such as patent oppositions.  They are paid directly by the ‘loser’ to the ‘winner’, and are intended to offset the actual costs of the proceedings incurred by the successful party.  IP Australia is proposing to increase the costs that may be awarded significantly (by more than four times in some cases), on the basis that this will ‘better reflect the actual costs incurred’, and that the proposed costs ‘are based on the practice of the Federal Court’.  Both of these justifications may be true, though that does not automatically make them relevant!

Universities and Research Institutes Dominate Australian and New Zealand PCT Filings

PCT Contracting States (153)In earlier articles I have looked at data on Australian patent filings and grants, as well as associated attorney firm performance.  While these numbers give us a good picture of application activity in Australia, they provide no information on the filing activities of Australian applicants in other jurisdictions.  Many innovators that are ultimately interested in securing patent protection in multiple countries choose to do so by first filing an international application (IA) under the Patent Cooperation Treaty (PCT).  In this article, therefore, I examine some recent PCT filing data for applicants, and patent attorney firms, resident in Australia and New Zealand.

As most readers will be aware, the PCT is an international treaty administered by the World Intellectual Property Organization (WIPO) that enables residents of any member country (of which there are currently 153, illustrated by the map at the top of this article) to file a single IA that has the effect of establishing a corresponding filing date in all of those countries, and associated regional patent systems.  While the PCT system is sometimes presented as a mechanism for improving efficiency and/or saving money, whether or not it achieves such benefits depends very much on each individual case, and the extent to which its centralised search, ‘preliminary examination’, and amendment processes enable subsequent national applications to be streamlined.  In practice, it remains necessary to file further applications in all countries of interest within 30 (or, for some countries, 31) months of the initial priority date, which must then each be examined under the corresponding national patent laws and procedures before any patent is actually granted.  All else being equal, therefore, a PCT application represents an additional cost, incurred prior to the various national costs, and may delay the examination and grant of national patents by up to two and a half years.

Despite this, the PCT system is popular with many Australian and New Zealand applicants.  In 2018, for example, Australian residents were named as applicants on over 1,700 IA’s, which compares favourably with the 2,756 domestic standard patent applications filed by Australian applicants in that same year.  The reason for this popularity is clear – even though it represents an additional cost, an IA defers a final decision on the jurisdictions in which patents will be pursued, along with the substantial further costs of filing and examination in multiple national and/or regional patent offices, for up to an additional 18 months.

This benefit of the international application system is clearly reflected in the most enthusiastic users of the system.  Of the top 20 Australian and New Zealand applicants named in PCT applications published over the three years between the beginning of 2017 and the end of 2019, 14 are universities or other public research institutions.  Of the remaining six, three are medical device manufacturers.  All of these are organisations that can particularly benefit for the deferral of further filing decisions and costs that the PCT system provides.

28 January 2020

Interactive Maps II: Where do Leading Patent Attorney Firms Find New Clients?

Australia Map PinIn my previous blog post, I explained how preparing articles looking at patent applicants, patent recipients, and attorney firm performance over calendar year 2019 had got me thinking about where ‘new’ Australian patent applicants come from, in the literal sense of where they are located geographically?  I also noted that IP Australia’s annual IP Government Open Data (IPGOD) release includes geographical information, in to the form of latitude and longitude coordinates, for Australian-resident applicants.  In particular, the most recent release, IPGOD 2019, includes location data for most Australian applicants going back over more than three decades, up until the end of 2018.

From this data, I have generated two interactive maps.  In the previous article I presented the first, showing the geographical distribution of new applicants that used the services of a patent attorney versus those that filed their own applications.

In this article, I present the second map, showing the distribution of new client acquisitions by ten leading Australian patent attorney firms.  The maps shows that, unsurprisingly, metropolitan applicants that engaged an attorney showed a distinct – though not universal – tendency to choose a firm with a local physical office.  Interestingly, comparing with the other map of self-filers versus those that engaged an attorney, an absence of local patent attorneys does not appear to be a major influence on whether applicants chose to self-service, rather than tracking down an attorney – the distributions of self-filers and those who engaged an attorney look very similar.  On the other hand, among leading firms it is clear that some do a better job than others of reaching out to acquire clients in regional areas.

Interactive Maps I: Where Do New Australian Patent Applicants Come From?

Australia Map PinIn my recent articles looking at patent applicants, patent recipients, and attorney firm performance over calendar year 2019, I noted (from all three perspectives) the disappointing showing of Australian applicants.  That being said, there are, nonetheless, thousands of applications filed by Australian residents every year, which got me wondering – out of idle curiosity as much as any expectation that it would be especially enlightening – where do ‘new’ Australian patent applicants come from?  I mean this in the most literal sense: where are Australian companies and individuals, filing for the first time, located geographically?

Fortunately, IP Australia’s annual IP Government Open Data (IPGOD) release includes geographical information, in to the form of latitude and longitude coordinates, for Australian-resident applicants.  In particular, the most recent release, IPGOD 2019, includes location data for most Australian applicants going back over more than three decades, up until the end of 2018.  I thought it might be fun to turn some of this data into interactive maps.

I have generated two such maps.  In this article I will present the first, which shows the geographical distribution of new applicants that used the services of a patent attorney versus those that filed their own applications.  Unsurprisingly, the data shows a concentration of applicants in the major cities of Sydney, Melbourne, Brisbane, Adelaide, and Perth.  However, a significant number of applicants is also located in regional Australia.

In a separate article, I present the second map, showing the distribution of new client acquisitions by ten leading Australian patent attorney firms.

22 January 2020

Samsung Tops Australian Patent Grants for 2019, with Local Innovators Nowhere to be Seen

BinocularsIn my previous two articles I looked at entries to the Australian patent system in 2019, i.e. who filed new applications last year, and which patent attorney firms were the ‘winners’ and ‘losers’ in the filing stakes.  These numbers tell us something about the current state of the market, and which companies are innovating – and seeking to protect their innovations – right now.  Many people, however, are more interested in who has been obtaining granted patent rights, rather than who might obtain granted rights in a few years’ time.  Indeed, the unveiling of the top recipients of US patents by IFI Claims Patent Services has become something of an annual event, generating considerable media interest, and the now-familiar sight of IBM sitting at the top of the list (for 27 consecutive years).

According to IFI Claims, there were 333,530 new US patents issued in 2019.  Patently-O’s Dennis Crouch, on the other hand, puts the number at 354,507, while a search on the USPTO’s own database (using the query string ‘ISD/20190101->20191231 and APT/1’) returns a count of 354,446.  Who to believe?!  Whichever number is correct, 2019 established a new all-time high, at about 10% above the previous record set in 2017.

I do not expect there to be quite as much interest in the fact that 17,007 Australian standard patents were granted in 2019.  This was not a new record.  In fact, it was slightly lower than 2018, when 17,065 standard patents were granted, and well below the 2016 peak of 23,774.  It should be kept in mind, however, that a surge in patent grants between 2014 and 2017 was driven largely by the behaviour of applicants bringing forward requests for examination prior to commencement of the Raising the Bar reforms on 15 April 2013, so the past couple of years should represent a more normal rate of patent issuance based on the underlying filings and examination requests.

Samsung topped the list of patent recipients in Australia with 203 patents, followed by Covidien (150), Apple (137), LG Electronics (132), and Huawei (119).  Not one Australian patentee appeared in the top 50, although New Zealand’s Fisher & Paykel Healthcare just squeezed in at number 48, albeit with just 35 patents.  By way of comparison, in 2019 Samsung obtained 6,469 US patents (ranked 2nd), Covidien 92 (68th), Apple 2,490 (7th), LG 2,805 (6th), and Huawei 2,418 (10th).

A notable absence from the top end of the rankings is Aristocrat which, despite filing a total of 722 standard patent applications between 2015 and 2018 received only 13 granted patents in 2019, in second place among Australian patentees behind national research organisation CSIRO with 25.  In fact, the top 30 Australian patentees combined received only 162 patents in 2019, or 31 fewer than Samsung.

Overall, despite being consistently the second largest filing group (after US residents) Australians were only the fifth most numerous recipients of Australian patents in 2019, with just 908 patents, behind Germans (937), Chinese (1,035), Japanese (1,257), and US residents (8,139).  So it seems that Australians are shunning our own patent system, which might not be such bad news if there were any sign that Australian applicants were securing patent protection in major export markets.  This does not, however, appear to be the case.  IFI Claims lists only the top nine countries in its public summary of US patent trends, from which Australia is absent, placing the country somewhere behind ninth-placed Canada, which received 4,651 US patents in 2019.

21 January 2020

Winners & Losers in Patent Filings – Why 2019 Was a Bad Year for Many Major Attorney Firms, and for Australia

You win, you loseIn my previous article, I looked at the top applicants for Australian patents in 2019.  In this article, I turn the spotlight on the Australian patent attorney firms that were responsible for handling many of those filings.  Having identified a 1% decline overall in standard patent filings, a nearly 20% decline in innovation patent filings, and essentially no change in provisional applications, it stands to reason that the Australian patent attorney profession as a whole has not experienced any growth in patent filing work over 2019.  However, as we shall see, the pain has not been shared equally across the profession.

Based on total patent filing numbers alone (which is, of course, not the whole story – although for many firms it is a significant part of it) the big winners in 2019 were, by and large, smaller independent firms, which appear to have beaten out a number of larger firms in acquiring new filing work.  Among the bigger and better-known brands, however, there is little evidence that ownership status – i.e. whether a firm is privately-held, or a member of either of one the listed IPH (ASX:IPH) or QANTM IP (ASX:QIP) groups – was a significant factor in securing filing work.  Size, rather than ownership, appears to correlate more closely with whether filing numbers grew or declined in 2019.

Comparing with my analysis for the 2018 calendar year, the top 10 firms for overall patent filings in 2019 remained unchanged, with Spruson & Ferguson, Davies Collison Cave (DCC), Griffith Hack, FB Rice, Phillips Ormonde Fitzpatrick (POF), Pizzeys, Shelston IP, FPA Patent Attorneys, Watermark (soon to be merged into Griffith Hack), and Madderns all taking their places in the same order as the previous year.  However, all but DCC experienced a decline in overall filings, and in standard application filings.

Aside from DCC’s gain in standard application filings, and a strong showing from Spruson & Ferguson on innovation patent filings, listed-group firms generally went backwards in 2019, with the winners across all application types (i.e. standard, provisional, and innovation) being privately-held firms.  However, this seems to have had less to do with ownership structure than size, and a general trend in favour of smaller firms over larger ones (which I have previously noted with respect to Australian SME clients, but which appears to be true more broadly).  With the notable exception of a significant growth in provisional application filings by FB Rice, the larger privately-held firms (which also include POF, Wrays and Madderns in Australia, and New Zealand based James & Wells) also failed to make gains in filing numbers in 2019.

While most people outside the profession probably care little for the business challenges faced by patent attorneys, I would argue that a bad year for attorney firms is also a bad year for Australia.  It is well-established that innovation underpins improvements in productivity and a rise in the standard of living (preferably with a reduced environmental impact), and demand for patent attorney services is (or should be) linked to levels of innovative activity.  Logically, then, stagnation in demand for such services is not good news for the nation.

17 January 2020

Chinese Mobile Tech Company OPPO Comes from Nowhere to Top Australian Patent Filing Table for 2019

2019Last calendar year, the number of standard patent filings in Australia fell by 1%, from 29,957 in 2018 to 29,666 in 2019.  While this represents only a small decline, it follows two years of growth, by 1.8% for 2016-2017 and 3.6% for 2017-2018, and thus represents a reversal of the recent upwards trend.  While international data on 2019 patent filings is not yet available, I think it doubtful that when IP Australia releases the 2020 edition of its annual Australian IP Report later this year it will be able to claim a high ranking for Australia among the Organisation for Economic Co-operation and Development (OECD) countries in terms of patent growth, as it did in last year’s report.  The 2019 result reflects a decline in both direct filings, and filings resulting from national phase entry of international applications previously filed under the Patent Cooperation Treaty (PCT).

Demand for Australia’s second-tier patent right, the innovation patent, also fell in 2019, with 1702 applications for innovation patents being filed, compared with 2121 in 2018.  Legislation to phase out the innovation patent system passed in the Senate late last year, and now merely awaits the formality of passage through the House of Representatives before becoming law, although it seems unlikely that the decline in filings is in any way related.

Provisional filings – mostly by Australian residents – remained steady, with 4,947 provisional applications filed in 2019, compared with 4,943 in 2018.  This is mildly positive news, following as it does a fall of 5.2% between 2017 and 2018. 

It is also encouraging to see that self-filing of new patent applications declined yet again in 2019.  The number of originating applications (i.e. those that claim no earlier priority date, and are thus in most cases freshly-drafted) filed without the assistance of a patent attorney or other agent dropped to 1,702 from 1,870 in 2018.  This is now less than half of the nearly 3,500 originating applications that were self-filed each year between 2002 and 2007.  I regard this as a positive trend because the available data establishes, beyond any doubt, that outcomes for self-represented applicants are consistently far inferior to those of applicants that engage professional assistance.

As in previous years, the list of top applicants for Australian standard patents is dominated by foreign companies, with Aristocrat Technologies once again the only Australian company to appear in the top 30.  Aristocrat fell two places, to number four in the rankings, despite filing 238 standard patent applications (only just shy of the 252 it filed in 2018), and a significant decline in filings (from 314 to 244) by last year’s top applicant, Qualcomm, which now stands third.  LG Electronics was a big mover, increasing its filings from 175 to 245 to grab second spot.

The big surprise in the rankings is first-time entrant Guangdong OPPO Mobile Telecommunications Ltd (‘OPPO’), which leapt straight to number one with 314 standard patent applications.  OPPO had never filed more than 19 Australian applications in any previous year (that was in 2017), and had filed a grand total of just 47 applications up until the end of 2018.

Among Australian residents, universities and public research institutions once again feature prominently, taking half of the top 20 places in the local rankings of standard patent applicants, and 12 of the top 20 in the provisional filing chart.

For all the numbers, and further commentary, please read on.

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