IP Australia is Seeking Feedback on Proposed Fee Changes

IP Australia has published a draft of its four-yearly Cost Recovery Implementation Statement (CRIS), which outlines proposed fee changes that would take effect from October 2024.  It is also taking the opportunity to review the hearing costs that may be awarded for Patents, Trade Marks and Designs.  Feedback on the proposals may be provided via submissions to IP Australia’s public consultation page.  Consultation is open until Sunday, 21 January 2024. 

In this article I will be looking in greater detail at some of the changes relating to patents in particular.  Stakeholders with an interest in any of the rights administered by IP Australia (patents, trade marks, registered designs and plant breeder’s rights) should take the opportunity to review the draft CRIS and submit any comments or concerns during the consultation period.  Briefly, on non-patent matters, I note that there are significant changes proposed to the fee structure associated with trade mark opposition hearings, with fees that increase with the number of grounds, beyond the first three, raised in a Statement of Grounds and Particulars (SGP), and with the number of prior trade marks, beyond the first ten, cited under section 44.  For designs, it is proposed to reduce application fees, while the fees for requesting examination will be slightly increased.  For Plant Breeder’s Rights, modest increases to application fees are proposed, however there will be more substantial increases in examination fees, and a doubling of renewal fees.

Registered trans-Tasman attorneys will want to take note that IP Australia is also proposing to increase registration renewal fees by A$50 across the board, which it says is required ‘to assist in covering the cost of administering the Trans-Tasman IP Attorney system.’

In the patents area, the headline changes, discussed in greater detail below, are: modest increases to most filing, examination and renewal fees; a doubling of opposition and hearing fees; a change in the timing (but not amount) of excess claim fees, from being charged at acceptance to (also) being charged at the time of requesting examination; a surprising (and perhaps unintentional) removal of innovation patent filing fees; and significant increases to the level of costs that can be awarded in contested proceedings, including patent oppositions.

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Tags: Australia, Costs, Fees, Patent Office, Public consultation

Profile of the Creator of AI ‘Inventor’ DABUS Raises More Questions About International Test Cases

A profile of DABUS creator Dr Stephen Thaler, written by Tomas Weber and published by The Economist in April 2023, paints a picture of a rather isolated man – a septuagenarian, the product of a traumatic childhood, slightly paranoid, seemingly obsessed with his creation, and whose supportive wife seems resigned to the reality that he spends more time with his machines than he does with her.  To be clear, I have no way of knowing whether this is accurate.  I can only go on what is written in the article.  But assuming Weber’s account is a fair assessment, I would suggest that it raises additional questions about the ongoing global efforts – driven by Professor Ryan Abbott and his Artificial Inventor Project – challenging the legal barriers to AI inventorship and authorship.

The article, entitled The inventor who fell in love with his AI, is paywalled, so unfortunately you will need a subscription (or access to an institutional subscription) to read it.  I will try to hit some of the main points here, by way of review and commentary, but obviously copyright prevents me from reproducing large portions of the article.  The first point I would make, however, is that the title is somewhat misleading and sensationalist.  While it is liable to invoke notions of romantic love – à la Spike Jonze’ 2013 film Her – Weber in fact reports, in the depths of the article, that Thaler ‘has developed what seems like a genuine paternal affection for the AI, and recalled cooing to it gently in the early stages of its development’.  In Thaler’s words, “[i]t’s a child-and-father bond.”

More importantly, however, Weber’s profile of Thaler goes no way towards persuading me that DABUS is capable of true creativity or invention.  The article reveals that the output of the machine allegedly representing the ‘fractal bottle’ invention described and claimed in the DABUS patent applications was “food drink in fractal bottle increase surface area making faster heat transfer for warming cooling convenience pleasure”.  This is barely a coherent sentence, let alone an enabling disclosure of any kind of invention.  At best, it may serve to inspire a line of thinking that could result in the reader developing some inventive idea.  What is a ‘fractal bottle’?  How should the ‘fractal’ be deployed to ‘increase surface area’?  Would this invariably result in ‘faster heat transfer’, or are there other design considerations involved?  How does this provide ‘convenience’?  Or ‘pleasure’?  So many questions, to which a patent attorney would need answers in order to prepare a patent specification.  Who provides these answers?  Is it the machine, or is it the machine’s human owner who was the first to observe and be inspired by the machine’s output?  And, if the latter, then are they not the true inventor just as surely as someone who stumbled across inspiration by chance in the natural world?

There are, also, some more disturbing implications of Weber’s account.  Thaler is presented as someone who had a difficult childhood, and whose life experiences may have led him into a less-than-healthy relationship with technology.  Some of his beliefs about his machines, and their capabilities – and, indeed, about himself and his fellow humans – may, in Weber’s version of Thaler’s story, derive more from trauma and a search for meaning than from objective scientific evaluation.  Weber describes a man who is perhaps in failing health, who has experienced disappointments and perceived injustices, and who has a bleak view of his fellow men and a vision of a possible coming AI apocalypse. 

Yet this is the man who – with his creation, DABUS – has become the vehicle for the Artificial Inventor Project’s international campaign to achieve legal recognition for AI ‘inventors’.  The result of this campaign was only ever going to be a further series of disappointments and resentments, as jurisdiction after jurisdiction rejects DABUS’ claims to inventorship.  And for Thaler, each rejection is only further evidence of the world’s refusal to accept his claims of his machines’ profound creative capabilities.

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Tags: Artificial intelligence, DABUS, Patent law, Public policy

Intellectual Property is Integral to AI Regulation, and Getting it Wrong Will Hand More Power to Big Tech

Governments around the world are considering how they can – and should – regulate the development and deployment of increasingly powerful and disruptive artificial intelligence (AI) technologies.  Australia is no exception.  On 1 June 2023, the Australian government announced the release of two papers intended to help ‘ensure the growth of artificial intelligence technologies (AI) in Australia is safe and responsible’.  The first of these is the Rapid Response Report: Generative AI, which was commissioned by Australia’s National Science and Technology Council at the request of the Minister for Industry and Science, Ed Husic, back in February.  The Rapid Response Report assesses potential risks and opportunities in relation to AI, and is intended to provide a scientific basis for discussions about the way forward.  The second paper is the Safe and Responsible AI in Australia Discussion Paper which, according to the Minister’s media release, ‘canvasses existing regulatory and governance responses in Australia and overseas, identifies potential gaps and proposes several options to strengthen the framework governing the safe and responsible use of AI.’

The discussion paper seeks feedback on how Australia can address the potential risks of AI.  It provides an overview of existing domestic and international AI governance and regulation, and identifies potential gaps and additional mechanisms – including regulations, standards, tools, frameworks, principles and business practices – to support the development and adoption of AI.  It focuses on ensuring AI is used safely and responsibly, but does not consider all issues related to AI, such as the implications of AI on the labour market and skills, national security, or military specific AI uses.

Another key area that is expressly excluded from this consultation is intellectual property.  That is, in my view, a serious shortcoming.  It appears to presume that IP is somehow separable from the other issues covered by the discussion paper.  This is a flawed presumption, particularly in relation to business practices.  In the contemporary world, IP is at the heart of many business practices, and the laws and regulations that we make around IP can be the difference between a business practice that is viable, and one that is untenable.  And not every business practice that might be enabled by IP laws is necessarily desirable or of net benefit to society.  If we fail to consider the interplay between IP laws, business practices, and other forms of regulation, then we risk making mistakes that might prove very difficult to undo in the future.

This article is prompted by, but is not primarily about, the Australian consultation process (although I will return to that at the end).  It is about how IP rights, and other forms of regulation, could operate to concentrate increasing levels of power in the hands of the few big tech companies – such as Microsoft (through its partnership with OpenAI), Google and Amazon – that have risen in recent years as the dominant players in AI and its enabling technologies.  Based on recent developments, I believe that the stage is already being set for implementation of exactly the kinds of laws and regulations that would most benefit these companies, under the guise of protecting innovators, content creators, and the general public against the various threats said to be presented by AI.

A perfect storm is brewing.  Onerous regulation around the development, training and deployment of AI systems could combine with IP-based restraints on the use of training data, and on AI outputs, to bake-in an advantage for the world’s richest and best-resourced companies.  The storm is being fuelled by hype and fearmongering which, even though much of it may be well-intentioned, plays to the interests of big tech. 

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Tags: Artificial intelligence, Australia, Copyright, Innovation policy, Machine learning, Patent law, Public consultation, Public policy

Zombie Patents! Can Expired Innovation Patents Still Be Examined and Certified?

The Australian Patent Office recently issued two decisions on the examination and certification of innovation patents owned by UK company Diogenes Limited: Diogenes Limited [2023] APO 5 concerning innovation patent no. 2020104437 (‘Diogenes 1’); and Diogenes Limited [2023] APO 8 concerning innovation patent no. 2021103809 (‘Diogenes 2’).  Both patents claim inventions relating to electronic pool wagering systems and – unsurprisingly, given this subject matter – both were found to be unpatentable under Australia’s ‘manner of manufacture’ approach to patent-eligibility.  However, it is not the substantive reasons for refusing to certify the patents that is of most interest.  What is unusual about both patents is that they had each expired before an initial examination report had even been issued.  Despite this, IP Australia proceeded with examination, issuing three reports on patent no. 2020104437, and two reports on patent no. 2021103809, before in both cases accepting requests to be heard and issuing the decisions noted above.  Just to repeat for emphasis, all of this activity occurred after the patents had expired.

The rationale for proceeding with examination is given in Diogenes 1 at paragraph [10], where the Hearing Officer observed:

It is not usual for the Commissioner to undertake actions on an expired patent. However, I note that, in order for the patentee to enforce their rights in relation to an innovation patent, it is necessary for that patent to be examined and certified. In such circumstances, and noting that the patentee could potentially bring infringement proceedings up to 6 years after expiry (assuming infringement proceedings occurred just prior to the expiry date – see subsection 120(4) of the Act), undertaking examination (and this decision) after the expiry date is appropriate.

I find this statement confusing, and suspect that the Hearing Officer may have meant to suggest that the infringement itself – rather than the ‘infringement proceedings’ – may have occurred prior to the expiry date of the patent.  In any event, we will get to the circumstances in which an expired innovation patent, that was not examined and certified within its lifetime, may nonetheless be enforceable.

Diogenes 2 was decided by a different Hearing Officer, who (at paragraph [4]) adopted the reasoning of Diogenes 1 for proceeding with examination of an expired innovation patent.

In the Diogenes cases, examination of the innovation patents was requested while they were both still alive – albeit, as we shall see, just barely!  But these decisions raise the question of whether a (former) patentee could request examination of an expired innovation patent and, in such a case, whether the expired patent could be retrospectively certified and enforced up to six years after expiry.  If so, then this might apply not only to patents that expired at the end of their maximum eight year term, but also to patents that ceased earlier than this due to non-payment of an annual renewal fee.

The upshot is that zombie innovation patents are able to rise from the dead and reach back in time to capture historical infringements!

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Tags: Australia, Examination, Innovation patent

IPH Sues Again, as Competition Hots Up for Australian and New Zealand Patent Filings in 2022

As I recently reported, Australian (standard) patent filings in 2022 remained close to the historic highs of the previous year.  This implies, of course, that patent attorneys filing applications on behalf of domestic and foreign clients should, overall, also have maintained high numbers of new filings.  But, of course, individual firms fared differently in the competition for this work.  Looking at total new standard patent filings across Australia and New Zealand, gains were made by the two firms owned by QANTM IP Limited (ASX:QIP), namely Davies Collison Cave (up by 5.7% to 4094 applications) and FPA Patent Attorneys (up by 3.9% to 2444 applications, after incorporating filings originally made by Cotters).  Other firms to make notable gains, in terms of both filing numbers and percentage growth, were FB Rice (up by 7.6% to 3697 applications), Wrays (up by 16.2% to 1380 applications) and RnB IP (up by 10.5% to 864 applications).  Firms that also made good percentage gains, albeit off a lower base of filings, included Allens (6.0%), Michael Buck IP (6.6%), Adams Pluck (22.6%), Dentons (30.7%) and Collison & Co (18.7%).

On the other side of the ledger, Madderns’ filings fell by 13.5%, to 801 applications.  Within the group of firms owned by IPH Limited (ASX:IPH), Spruson & Ferguson, AJ Park and Pizzeys all saw declines in new filings (by 7.9%, 2.8% and 2.9% respectively), while Griffith Hack held steady with a small (0.6%) increase in filings.  IPH has just reported its half-year financial results (for July-December 2022) [PDF 255kB], and while the news was positive for the group overall – a 24% uplift in underlying earnings before interest, tax, depreciation and amortisation (EBITDA) to A$80.4 million – like-for-like EBITDA for the Australian and New Zealand IP businesses declined by 6%.  IPH has blamed this partly on travel expenses, with activity increasing following the end of COVID-related travel restrictions.  But it is apparent that a decline in Australian and New Zealand patent filings has also contributed. 

In related news from the IPH group, while Pizzeys settled its legal dispute with RnB IP late last year, Spruson & Ferguson recently commenced similar proceedings in the Federal Court of Australia (case no. NSD6/2023) against upstart firm GLMR and its four principals.  And, just as the founders of RnB IP were former employees of Pizzeys, the principals of GLMR are all former employees of Spruson and Ferguson.  Through its Federal Court action, Sprusons is seeking an order for preliminary discovery – presumably fishing for evidence of GLMR’s contact with Sprusons’ clients – which is precisely how Pizzeys commenced its action against RnB IP in June 2019.  To date, GLMR has filed just 194 applications (with the earliest being in February 2022).  However, it has also taken over responsibility for at least 629 applications that were previously filed and/or managed by Spruson & Ferguson.  It is early days yet, but we can perhaps expect to see this dispute take much the same course as Pizzeys v RnB IP.

Let’s have a look at the numbers in more detail.

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Tags: Annual patent data, Australia, New Zealand, Patent analytics, Patent attorney profession

Korea’s LG Tops Australian Patent Filing Table, While IBM Surprises in Second Place

In recent years, the title of leading filer of Australian patent applications has been hotly (though probably inadvertently) contested between Huawei Technologies Ltd (China), Guangdong OPPO Mobile Telecommunications Ltd (China), and LG Electronics (South Korea).  In 2022, LG was a clear winner, with 283 new standard patent applications.  Huawei filed 181 applications, while OPPO disappeared entirely from the leader board, with just 16 applications filed in 2022 – a long way short of the 435 applications it filed at its peak in 2020. 

The big surprise of the past year, however, is the appearance of IBM in second place, with 189 applications.  The company affectionately known as ‘Big Blue’ was the leading US patent recipient for a remarkable 29 consecutive years.  At its peak, it filed more than 10,000 applications in a single year, and received 8,682 US patents in 2021.  However, throughout all of this time IBM has not been a major patent applicant in Australia, filing no more than 35 applications (in 1995) during any year between 1991 and 2020.

Other major filers of recent years to have dropped out of the top 30 include cloud computing and virtualization technology provider Citrix Systems, Inc (sixth placed in 2021 with 147 applications, down to just 19 filings in 2022) and semiconductor and wireless technology company Qualcomm Inc (which peaked at 326 applications in 2018, but filed just 28 times in 2022).

Once again, the leading Australian-based applicant was Aristocrat Technologies Australia Pty Ltd with 69 applications, followed by the Commonwealth Scientific & Industrial Research Organisation (CSIRO) with 51 applications.  As in 2021, the top New Zealand applicant was Fisher & Paykel Healthcare Ltd which, with 111 applications, easily out-filed the leading Australians.

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Tags: Annual patent data, Australia, Patent analytics

Australian Patent Filings Declined Slightly in 2022, but Held at Historic Highs by Strong International Interest

In 2022, for the second year running, the number of standard patent applications filed in Australia exceeded 30,000.  While there was a slight decline of 0.5% compared with 2021, filings remained at a historic high.  This was, however, primarily due to continuing growth of nearly 1% in applications originating overseas.  Applications from Australian residents fell by 16.6%, returning to around the same level as between 2016 and 2020 following a bumper year in 2021 that was driven substantially by applicants wishing to secure a filing date prior to the phase-out of the innovation patent system.  Also disappointing was a continuing decline in the number of provisional applications filed.  Provisional filings have not been as low as they are now since the mid-1980s.

The United States remained the largest source of new Australian patent applications, by a large margin, accounting for 46% of all filings.  Australian residents held on to second position, despite the significant drop in filings, as the number of applications from China fell for the first time in more than two decades.  The top 10 remained the same overall, with the UK and South Korea each gaining a position, at the expense of Germany and France.  The UK is now in fifth place, and only marginally behind fourth-placed Japan, following two consecutive years of strong growth in filings.

Australia’s poor patenting performance continues to be a concern.  It is not just about resident applications, and there are a number of other metrics – including filings in other jurisdictions and various other innovation indicators – that consistently point to Australian underperformance in the identification, protection, management and commercialisation of technological innovations.  This is an area in which Australia needs to do better.

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Tags: Annual patent data, Australia, Patent analytics