22 February 2024

Patent Filings in Australia Fell Again in 2023, but Applications from China are Bucking the Trend

2023 falling. Image generated by Google Gemini.In 2023 the total number of standard patent applications filed in Australia remained above 30,000 for the third year running, despite a 2.4% drop in filings.  This follows a decline of nearly 0.5% in the previous year.  However, whereas the decline in new applications in 2022 was due to fewer filings by Australian residents (with a slight increase in foreign-originating applications preventing a larger fall), the drop in 2023 was the result of nearly 800 fewer filings by foreign applicants.  As always, a majority of new filings were national phase entries (NPEs) derived from international applications under the Patent Cooperation Treaty (PCT).  But, for the first time since 2016, the number of PCT NPEs fell – by 3.2% – offset somewhat by a 14% rise in new direct national filings.  The number of divisional applications also fell in 2023, by 7.3%.

In some (very limited) good news for Australia, patent filings by domestic residents increased by 2.6%, while the number of provisional applications increased by 5%.  Unfortunately, however, two thirds of the additional provisional applications in 2023 were filed without the professional assistance of a patent attorney.  (I say ‘unfortunately’ because, as I have shown previously, the outcomes for self-represented applicants are generally abysmal, so for the most part they are wasting their time and what little money they are expending on fees to IP Australia.)

The top 10 countries of origin of applications filed in 2023 were the United States, Australia, China, Japan, the UK, Germany, Switzerland, South Korea, France and Canada.  There were substantial drops in the numbers of applications filed by applicants from the US (-6.0%), South Korea (-10.5%) and Canada (-14%).  The largest growths in filings were from China (12.1%) and Japan (5.2%).  China is once again snapping at the heels of Australia from second position on the league table.  This happened previously in 2020, when I (mistakenly) predicted that Chinese filings might surpass domestic filings as early as 2021.  But while it is taking longer than appeared likely a few years ago, it seems inevitable that Australians will soon fall behind Chinese applicants as users of the Australian patent system.

Given that the innovation patent system is being phased out, it should come as no surprise that just 106 innovation patent applications were filed in 2023 (down from 191 in 2022), all of which were necessarily derived from existing applications filed prior to 26 August 2021.  Around two-thirds of applicants still filing for innovation patents are Australian (120 in 2022 and 67 in 2023).  Furthermore, a larger proportion of innovation patents are now being certified and made enforceable than has historically been the case, with 75 of those filed in 2022, and 31 of those filed in 2023, so far having been certified.  But with innovation patents now being a small, and shrinking, part of the Australian patent system, I shall have nothing more to say about them in this article, and I will drop the distinguishing term ‘standard’ when talking about ‘regular’ patent applications.

07 January 2024

The Major Australian Client at the Centre of David and Goliath Legal Battle Between Patent Attorney Firms

Breville invented the electric toasted sandwich maker in 1974As some readers may be aware (I have previously mentioned it only in passing) a firm in the IPH Limited (ASX:IPH) group – the market cap of which is A$1.56B at publication – is once again taking legal action against a recently-established firm and its founders, all of whom are former employees of Spruson & Ferguson (‘S&F’).  Earlier, IPH group firm Pizzeys had sued RnB IP and its two founders – formerly partners in Pizzeys at the  time of its acquisition by IPH – for alleged breach of non-compete, non-dealing, and/or non-solicitation restraints that were included in their employment contracts.  That dispute ultimately settled out of court and was finalised prior to trial, in September 2022, so we did not get the benefit of judicial consideration of whether the contractual restraints were reasonable and/or enforceable.

The startup firm on this occasion is GLMR, founded by Edward Genocchio (‘G’), Michelle Lee (‘L’), David M├╝ller-Wiesner (‘M’) and Simon Reynolds (‘R’).  The firm was also, for a short period, known as LMW IP, which was established by ‘L’ and ‘M’ before they were joined by ‘G’ and ‘R’.  The action taken thus far against GLMR and its founders by S&F is an application to the Federal Court of Australia for preliminary discovery (case no. NSD6/2023), in which the GLMR parties are identified as prospective respondents in a potential future action.  This is the same strategy previously employed by Pizzeys against RnB IP.  In the RnB case, the preliminary application was contested, and resulted in a published decision of Justice Jagot ordering discovery.  In the present case, however, it appears that the parties have reached agreement on scope of discovery, with the corresponding orders made by a Registrar of the court (see orders made on 23 October 2023 [PDF, 135kB]).  While preliminary discovery was initially due by 29 November 2023, this has been extended by further orders to 5.00pm on 16 February 2024.

The discovery orders provide some insight into the nature of S&F’s prospective case against GLMR.  An impression of the impact that GLMR has had on S&F’s patent business can also be discerned from the public records of the Australian Patent Office.  In this article, I take a look at these two aspects of the matter.

02 January 2024

Disciplinary Decision Against Registered Attorney a Reminder of the Importance of Clear Communication and Record Keeping

Pursuit

Back in July, the Trans-Tasman IP Attorneys Disciplinary Tribunal (‘the Tribunal’) issued a decision in relation to a complaint about a registered attorney (‘the attorney’) by a client (‘the client’) in response to which the Trans-Tasman IP Attorneys Board (TTIPAB, a.k.a. ‘the Board’) commenced disciplinary proceedings, bringing nine charges against the attorney.  The full decision of the Tribunal can be found here [PDF, 364kB], while a separate ruling on the penalties to be applied can be found here [PDF, 223kB].  This decision is a ‘first’ in a couple of respects.  It is the first time the Tribunal has sat as a three-member panel (rather than a single decision-maker).  It is also the first time that charges have been brought against an attorney under the Code of Conduct for Trans-Tasman Patent and Trade Marks Attorneys 2018 (‘Code of Conduct’’).  Reference to specific provisions of the Code of Conduct has resulted in charges having a clearer basis and greater precision than may have been the case in past disciplinary proceedings.

There are, in this decision, three important messages – or, one would hope, reminders – for registered trans-Tasman patent attorneys.

First, an attorney’s obligation to ‘disclose to a client all information of which the registered attorney is aware that is materially relevant to work being undertaken for the client’ (paragraph 17 of the Code of Conduct) extends to information about the state of the law.  In this case, the attorney was obliged to inform the client about the difficulties inherent in obtaining patents for business methods (whether or not implemented using computer technology), and about the requirement to provide a sufficient disclosure of a claimed invention along with the potential adverse consequences of failing to do so.  The attorney was found to have satisfied the first of these two obligations, but not the second.

Second, an attorney’s obligation to ‘have appropriate competency’ and to carry out work that they undertake ‘with due skill and care’ (paragraph 14 of the Code of Conduct) includes ‘adequately and properly advising’ a client of anticipated legal risks or difficulties that may be encountered in obtaining IP rights.  Closely related to the first point above, in this case the attorney was obliged to properly advise the client of the significant risk that a patent application directed to a business method would be refused, and of the risks associated with failing to include a sufficient disclosure of a claimed invention in a patent application.  Here, the attorney was found to have satisfied neither of these two obligations.

Third, an attorney’s obligation to ‘maintain standards of professional practice as a patent attorney … that are courteous, ethical and well-informed’ (sub-paragraph 13(2) of the Code of Conduct) encompasses appropriate record keeping.  In this case, the attorney was obliged to keep adequate documentation of the advice that had been provided to the client, whether or not that advice was given in writing.  The attorney was found to have failed in this respect with regard to advice provided in relation to two patent specifications prepared on behalf of the client.

I recommend that all registered and prospective trans-Tasman patent attorneys read the full decision.  It is a credit to the profession that disciplinary proceedings are few and far between, but this makes the rare decisions that we do have all the more important.  What follows is my own overview and comments.


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