The “historic achievement” is destroying the European Patent Organisation in just two days

Summary: In secretive sessions behind closed doors Battistelli and the Administrative Council conspired to send the no-longer-independent boards of appeal to exile, assuring that patent quality will nosedive and make the Office akin to a registration/filing office

THE EPO scandals should matter to everyone as everybody is effected, not only Europeans. This is a war that's waged between a class (rich people) and an occupation (patent lawyers) against everybody else. These rich people and patent lawyers are not necessarily European at all; they have clients from other countries/continents and some are not even based in Europe. A Napoleonic egoistic president who cares not about his popularity keeps leading the charge and they (along with the Administrative Council, typically lawyers and heads of national patent offices themselves) support him. As last night's report reminds us, staff (examiners, i.e. scientists) is just collateral damage and judges -- i.e. people whose role is to uphold the rule of law (unlike lawyers who typically try to work around the law) -- are being driven to exile, as per this morning's leak (now available as text). One might easily be led to believe that we're dealing here with a developing nation (or 'third world country' as some call it), but this is good old Europe, where systemic corruption is apparently still rampant. Patent examination is no longer appreciated because it's just easier to charge applicants for virtually nothing. It's like selling 'holy' water.

What the EPO now calls "reform" is basically a continuation of demolition of the appeals process, i.e. of quality control. A post in the EPLAW blog about the so-called reform says the following this morning: [found via this comment]

The structural reform of the Boards of Appeal (BOA) aims to increase their organizational and managerial autonomy, the perception of their independence and also their efficiency, in order to respect the principle of effective legal protection within the current legal framework of the European Patent Convention.

It introduces a new institutional framework in which the BOA will no longer be a Directorate General of the EPO directed by a Vice-President but a separate unit called Boards of Appeals Unit headed by a newly created President of the BOA. The Chairman of the Enlarged BOA will act as President of the BOA. The President of the EPO will delegate to the President of the BOA managerial functions and powers including the right to propose new members of the BOA and to propose re-appointment after the term of appointment.

A new advisory body, the Boards of Appeal Committee (BOAC) is created as a subsidiary body of the Administrative Council (AC), composed of six members appointed by the AC, three of them representatives of the member states in the AC and another three from among serving or former judges of international or national courts. The President of the EPO and the President of the BOA have the right to attend BOAC meetings, without voting rights.

BOAC is a funny name. Why did Battistelli et al not just call it "BUNK", for the whole 'reform' is just bunk? For quite some time now we have hypothesised that the Unitary Patent Court/s would replace the boards if not (at best) complement their existing functionality, but right now Battistelli, his Office, a pro-UPC baroness and legal professionals pretty much acknowledge that the UPC is in shambles. It's impossible to deny, but MIP carries on with its UPC progress [sic] reports today (early in the morning).

How did we end up with a demolished set of boards (of appeal)? How did that happen so fast? Apparently Team Battistelli had people stay up until 2 AM to accomplish this task. As one person put it this morning: "It seems that the new version of the reform of the BOA was adopted with only one vote against (NL) and two abstentions (HU, IT)." This person shared "Reform of the BoA, final version, with modifications highlighted." [PDF]

"My respect to the representatives of NL, HU and IT," wrote another person. "Shame on all the others!" The leak that we published this morning caught the attention of the following commenter who wrote:

Just seen a report on Techrights:

http://techrights.org/2016/07/01/leaked-ac-report/

Reform of the BoAs: 35 in favour, 2 abstentions, 1 against.

Reforms include: relocation of the BoAs to a different building in Munich; increase of the appeal fees; new (career) structure; new conflict of interest rules.

There are no other words for it, what a bloody disgrace! The last point (on conflicts of interest) particularly sticks in my craw. Even CIPA questioned the legality / enforceability of those rules ("We question whether broad discretionary proposals would be enforceable in a national court if necessary"). And yet this point seems to have been totally lost on more than 90% of the delegations to the AC.

The other points in the report are almost too much to bear ("the Office presented a comprehensive social report, highly appreciated by the delegations", blah, blah, blah). The final straw has to be postponement of discussion of disciplinary procedures. That is nothing more than code for "Carry on as you were, take your decisions and we will cover it all up afterwards".

This seems like a massive loss for the EPO and a win for Battistelli, whose interests are very different from the EPO's. One person asked a short while ago: "Isn't there anything we can do? I realize that many of the people who write are EPO employees and fear for their salaries/pensions, but not everyone, surely."

Even past employees of the EPO are affected by this. Past patent recipients are likewise affected by this. Entire industries in Europe are negatively affected by this. Look what Battistelli has done. What will remain of the EPO by the time he leaves or gets sacked? Surely, the disaster which the EPO has become will cost a lot of money to the European economy; Europe will rot if this isn't stopped. The European Patent Office has just deepened the crisis and it will be harder to undo if Battistelli's attacks on the boards get implemented (not just reoccupying vacant openings). The EPO's PR team pretends everything is great, but exactly the opposite is true (that's why it hired disaster management professionals from the outside). Is Australia wishing to be associated with Battistelli and his declining Office starting today? "On 1 July 2016," this article says, "the Patent Prosecution Highway (PPH) pilot program between the Australian Patent Office and the European Patent Office (EPO) begins."

Is this likely to end up like the previous pilot programme which blew up in the EPO's face? Or the shortening of appeal periods (also effective starting today)?

Reading through some comments in IP Kat this morning, fury and despair are dominant. There is nothing at all to be tolerated, let alone celebrated.

One person wrote:

Let us face it, Battistelli has won the final battle. It is now clear that Battistelli can threaten the enlarged board of appeal publicly (that is the subject of this article) and get away with it. Any pretense of rule of law is abandoned.

It is now also clear that Battistelli can simply ignore the demands of the Council as he pleases (social dialogue, justice needs to be seen to be done, etc...). And it is also clear that he can fire whomever he pleases any time he pleases as he sees fit.

He won.

Regarding the EPO's monopoly one person said:

My dear Anonymous friend, if the users are not happy with all this they can go somewhere else to get their European Patents.

Oh, wait - they can't ...

The following comment called it "end of the EPO saga and the lowest morality level in the history of the Office."

We have now reached the end of the EPO saga and the lowest morality level in the history of the Office. It it clear that BB with his incompetent team will now reign undisturbed for another two years with the full support of the AC, whose members he convinced with cooperation money and intimidated with all kinds of threats. We can well imagine what they will produce in the coming two years with their absurd synergism. Disgraceful the attitude of the German delegation and government who tolerate such a situation on their territory. But we know: they have their own interest as the German Office has always been in competition with the EPO ! Disgraceful also the attitude of attorneys and their associations, especially the German and British ones. They will now get the inevitable erosion of quality and (good for them!) no many chances to play around with the claims as - in the name of efficiiency - the procedure will become more and more strict. Adieu to the good old days of the ideals! Adieu to the EPO as a model organisation! Adieu to the solid values of justice and respect ! The sharks are here.

"If these reports are true," wrote another person, "then the reputation and functioning of the EPO has been dealt a mortal blow."

If these reports are true, then the reputation and functioning of the EPO has been dealt a mortal blow. The AC has let the president off the hook yet again, when there could not have been more blatant evidence of him overreaching his powers (and even defying the will of the AC). I now struggle to conceive of a situation where the AC would impose severe sanctions (or indeed any sanctions at all) upon the president... so it is perhaps not all that fanciful after all to suggest that we could have a Guantanamo-am-Isar if it carries on this way.

Is there a well-informed reader who can provide us with information about how the various different delegations voted? Also, are there final forms of the texts of the proposals that have been approved by the AC? Whilst I am at a loss as to how this situation can be fixed, it will be important for the users to know which national delegations have effectively ignored their feedback.

Upon reflection, we should perhaps not be too surprised that BB was, in the words of a previous commentator, "granted impunity". A much clearer infringement of the independence of the Boards of Appeal occurred when the president suspended (pending investigation) a member of the Boards. In addition to being contrary to the independence of the Boards, no one has ever seriously suggested that this action was anything other than a gross violation of the wording (and principles) of the EPC. And yet the AC officially sanctioned / pardoned that action. They also sanctioned the prolongation of the suspension of the member concerned, which (in view of the term of office of that member) could be viewed as dismissal in all but name, ie yet another contravention of the EPC. Next to these actions, the president sending a naughty letter looks like nothing to get too worked up about.

Which reminds me: did the AC decide what to do about the suspended member, given that the EBoA has closed the disciplinary proceedings without proposing dismissal? Under the provisions of the EPC, it would seem that the only viable course of action will be to reinstate the member, pay his costs for the proceedings (as well as salary withheld during the period of suspension) and leave him in peace to get on with his job. There is also an argument that his term of office should be extended for a period equal to that of the period of suspension.

But is any of that likely to happen, or will the AC sanction yet another violation of the EPC? At least the costs for the proceedings should be paid, as that has been ordered by the EBoA.... but, oh wait, I forgot that, thanks to the AC, the president can ignore the orders of all judiciary with total impunity!

Regarding "EPO communication," one person said, "the Communication Department did yet another miracle" and to quote the reasons why:

The last “News from the Council” published by the EPO is clear: the last AC that took place the last two days in Munich was, if not a great success, at least an “historic achievement” (sic!). One can further read that the “social report [was] highly appreciated by the delegations”!! So one may gain the impression that everything went smoothly and parties are happy with our management and the situation in the EPO.

To put it mildly, this is far from being the truth. Or at least, this is far from being the perception of observers in and around the AC.

Fact is that in fine only ONE single topic was discussed in 2 days: DG3. And from the feedback gathered, (see below) the AC was very dense, including a working session until 2 o’clock in the morning. It has been a very hard ride for all participants, in particular for the President and his team.

One thing the EPO official communication is correct about: however sweaty, muddy and tough the whole game was in the end, what counts is that the president is still standing. Eventually, nobody cares if the game has been won during the prolongation, penalty shot or many yellow cards have been handed out... let alone if the real problems have not been addressed.

Regarding the DG3 'independence' ("23 interventions, no support but... expecting overnight a fundamental miracle"):

As indicated above, the AC only dealt with the single point of DG3 independence in two days: 23 interventions were made just on the first day. All of them, but 3, very critical of the original proposed reform.

In substance the criticisms broadly took on board the comments made by AMBA and the Staff Representation. These were mainly aimed at the potential interference or abuse of influence that the president could still have on the independence of the board such as:

o Delegation of functions and power and the revocation of that delegation; o Right of nomination of BoA and its president (more or less qualified as “Systemwidrig” by the DE); o Other topics such as careers, budget, Rules of Procedure, etc...; o Many insisted on the need to involve all parties in a consultation to produce a document having a wide acceptance.

In the other fields that are loosely linked to the issue of independence but were adamantly presented by the Office as “part of the package”, the criticism was equally severe:

o The Tax structure was heavily criticised by most interveners: “it does not make sense cut the filing costs of patents on the one hand and, on the other hand, render their defence expensive”, said more or less (not verbatim) the German delegation; o The relocation of building was broadly criticised as neither fit for purpose and nor economically making sense; o Last but not least the “post-employment” reform was discussed only in this context but was broadly perceived by most as neither useful in this context and wrong in its form: “es wirkt wie ein Fremdkörper”, so the DE Delegation.

Despite the flood of criticism, the Board 28 was tasked to work overnight on a new amended version taking on board the above comments.... “Mission impossible” was the comment from several observers.

This is just about the worst possible outcome and they rushed it so that it all happened in just two days without chance/opportunity for vetoes (many people are on holiday right now). Incidentally, it also helped take the abuses against EPO staff off the table and out of the agenda.

Finally, explains the following text, "sessions behind closed doors" went on, resulting in "flabbergasted" DG3 colleagues and "dizzy" staff representatives:

Showdown: a “compromise solution” (sic!) produced overnight to solve the problem of independence of DG3!

Some hope had been raised after that first day, that the AC had seen the light: the heavy discussions on the first day given some indication that not only the real problems have been grasped but also solutions integrating the comments made by observers, in first place AMBA, would be integrated. While no observers are allowed in the C-points (confidential), several participants reported that the level of disagreement continued in an even more intense during these sessions behind closed doors form (cannot confirm that shouting may even have been involved...).

But this hope evaporated quickly on the second day as a Rev.1 of both the independence document (CA/43/16 rev1) and the Post-service employment (CA/29/16 add.1rev.1) were tabled. It followed a surreal and short discussion were most intervening delegations explained their support for the suggested “compromise solution” (FR, DE, IT, SL, President). Despite warning from the IT, NL delegations, Epi and your staff representation, the document was “waved through” with only 2 abstentions (HR, IT) and one against (NL). The good intentions of the previous day towards consultation were forgo en: as an illustration, the observers, that is Epi/business Europe and the Staff representation, received the new version during the live session and nobody had a word about “statutory consultation” either.

Clearly some of the changes are positive in content, but the complexity of the dossier is such that, at this stage, it is too early to grasp their consequences. Fact is that these changes fail to take into consideration the main comments made the day before. It is even less understandable how this sudden change of mood came about. DG3 colleagues are flabbergasted and staff representatives dizzy. One remains sure: a fundamental document has been produced overnight, “mit heisser Nadel gestrickt”. God helps us... I suppose?

What an incredible coup that was. The EPO was right to call this "historic". It's definitely the lowest point in the EPO's history, unless someone can point out to us something even worse. ⬆