International and European patent law EU and US developments

1
International and European patent law -EU and
US developments

• Professori Niklas Bruun
• International IP Law 13.11.2007

2
The International Patent System

• PCT
• Europe
• EPC, EPO (EPLA)
• Community Patent Convention 1975 (never
  ratified
• Proposals for a Regulation early 2000
• No agreement due to 1) language 2) centralized
  court system
• SPLT (Substantive Patent Law Treaty) no
  progress lately

3
Commission Communication 23.4.2007 (8566/07)

• Community Patent
• An integrated jurisdictional system for patents
• The way forward
• EPLA optional dispute-settlement system
• Community jurisdiction for European and Community
  patents
• The European Commissions compromise proposal

4
The problems for the Community patent

• Patent litigation
• Degree and mode of decentralisation of the first
  instance of the patent litigation system
• Features of the second instance
• (linkage with CFI and ECJ, a specialised panel of
  CFI is possible)
• Qualification of courts
• Allocation of cases
• Languge of proceedings

5
Developments in the US system

• Europe First to file
• US First to invent
• Significant differences
• Pending The US Patent Reform Act of 2007 will
  turn the US system into a First-inventor-to-file
  system
• Prior art will be defined based on filing date
  (an applicants invention date will not be
  relevant any more

6
The battle on computer implemented inventions
(CII)

• Commission proposal for a CII Directive February
  2002
• Aims
• Harmonise CII law in EU (note EPO is not an EU
  institution)
• Maintain status quo in Europe, based on existing
  EPO practice
• No sudden change in the law
• EPC non patentable programs for computors
• Stop drift towards US practice of allowing
  business methods and non-technical software

7
Background

• But would exclude program product claims
  (reversing EPO decisions in IBM cases T 1173/97
  T 935/97)

8
Council and Parliament developments (1)

• Council General Approach adopted November 2002
• (pre-emptive of a formal Common Position)
• Improvement on Commission Proposal
• Program Product claims allowed if claim to
  computer/network in same pat. appln
• i.e. TWO categories of claim required (cost,
  pitfalls esp. for SMEs)

9
Council and Parliament developments (2)

• Legal Affairs Committee of European Parliament
  Report June 2003
• The McCarthy Report (after Rapporteur Arlene
  McCarthy)
• Allowed program product claims
• Allows programs on their own (even as a signal),
  or on a carrier
• Except infamous Article 6a supposedly about
  interoperability
• But exempts intercommunication as infringement

10
Industry Position

• No strong feelings in Industry so far
• Minor negative impact on business expected
• Program Product Claims excluded
• Rely on indirect infringement to enforce
• Strong opposing lobby (from so-called Open Source
  Software lobby)
• Goals
• No patents for software
• No patents for sw running on a computer

11
The Turning Point (1)

• Plenary vote in European Parliament on 24
  September 2003
• Outcome much worse even than worst case
  scenario according to industry
• The whole thrust of directive turned on its head
• Almost totally eliminated effective patent
  protection
• In telecoms, consumer electronics, computer
  industry
• And all software-reliant industry sectors
• Transport, vehicles, domestic appliances, medical
  instruments, etc.

12
The Turning Point (2)

• Significant economic impact on IT-companies
• Leaved most RD investment unprotectable by
  patents
• Leaves open for others to use results of
  expensive RD programs at no cost
• Reduces incentive for future RD investment

13
Was it really so bad? (1)

• The most problematic provisions
• All data-processing innovations excluded from
  patentability (Art. 3a)
• Because not in a technical field (not considered
  as inventions)
• All computer technology excluded from
  patentability (Art. 4b)
• Improved efficiency of resources does not justify
  a patent

14
Was it really so bad? (2)

• Use/operation of any data processing device not
  an infringement (Art. 5(1b))
• Exempts production, handling, processing and
  distribution of information
• Use of any computer, microprocessor, DSP etc is
  exempt
• Use of any CII for a significant purposenot an
  infringement (Art. 6a)
• The original data exchange/conversion in now
  merely an example
• Covers all useful patents
• If no significant purpose there is probably no
  patentable invention

15
The worst case scenario (1)

• Undermined existing patents as well as future
  patents
• Because Arts 5(1b) and 6a are framed in terms of
  exempting infringement
• A data processing operation within scope of an
  existing patent no longer an infringement after
  enactment

16
The worst case scenario (2)

• Likewise use of any patent for a significant
  purpose
• Certainly impacts all existing Standard-related
  patents
• Probably most existing useful patents too

17
and

• Undermines existing licences too
• Existing licensees could call for licences to be
  renegotiated
• Or stop paying royalties unilaterally
• Significant impact on companies for which
  royalties from licences form a great portion of
  the income

18
Final steps in legislative process, so far (2)

• - Actually the proposal fell after a conflict
  between the Council/Commision and the Parliament