09.11.16

New Paper Outlines Concerns That the EPO as a Patent Examination Office is Dying, Gradually Turning Into a Registration Office

Posted in Europe, Patents at 11:37 pm by Dr. Roy Schestowitz

What would that mean for existing EP (European patent) holders who pay renewal fees (the financial lifeline of the Office)? What would that mean for domain gurus who work as examiners?

Summary: The EPO appears to be going in the opposite direction of the USPTO (post-Alice/Mayo) and becoming more like the French patent system, which is notoriously deficient in terms of quality because there is no quality assessment (or prior art search) at all

THE EPO, as we shall show later this month, has turned into somewhat of a nut house under Battistelli’s notorious leadership. It’s not because examiners have mental issues (they are very stressed, understandably so, and it's growingly worse as time goes by) but because the Battistellites think like neoliberals whose goal is to just maximise everything monetary by deregulating everything. They are burning down almost half a century of reputation, essentially squeezing the goose as if there’s no tomorrow.

We have already mentioned the French model here. We did so several times in the past. The French patent model is widely regarded as poor, but the following new paper lays out an explanation of what happens at the EPO under the mostly French leadership from INPI (the French patent office which Battistelli pulled former colleagues from):

The French Model for the EPO

Summary
When the EPO was created in 1977, its founding fathers decided on a patent system that would provide for a high degree legal certainty for the inventor (investor), the competitors and the public, through high quality searches and examinations, the whole backed up by an opposition procedure and a second instance in the form of the Boards of Appeal. That decision has largely remained unquestioned by subsequent Presidents until Mr Battistelli took over. Indications are that Mr Battistelli is currently trying to remodel the EPO according to the example of the French patent system – without informing anybody. This should worry not only staff, but also the users of the patent system and the public.

The French patent system then
Until 1968, in France patent applications were not examined but merely registered. All what the French patent office did was stamp a date (and time of day) on whatever documents the
applicants brought to them. Patent granted before that time bear the mention “S.G.D.G.” meaning “Sans Garantie du Gouvernement” (i.e. without a warranty of validity by the government). Granted patents were only looked at when the patent proprietors sought to establish their claims. At that point the patents had left the patent office and national courts were responsible.

There are advantages to a registration system, first and foremost that it is cheaper for the patent office because it saves work. The obvious disadvantage is a lack of legal certainty until the patent is actually examined – by the courts. The French system nevertheless worked reasonably well. Without the presumption of validity, the risk of having a patent revoked was relatively high. French applicants reacted by drafting their applications in the safest way possible, thereby producing mostly clear claims of relatively narrow scope.

The French patent system now
Things changed when law n° 68-1 of January 1986 came into force. Article 6 of law 68-1 introduced the concepts of novelty and inventive step. This is mirrored Article L611-10 presently in force, the first paragraph of which reads:
“Sont brevetables, dans tous les domaines technologiques, les inventions nouvelles impliquant une activité inventive et susceptibles d’application industrielle.”

Also the other articles resemble those of the European Patent Convention, so that at a first reading the French patent system now looks very similar to that of the EPO.

There is, however, a major difference: Article L612-12, point 5, makes it clear that an application will be rejected only when the application obviously is non-patentable.

We cite the Guidelines of the French Intellectual Property Office (INPI)¹,²:

“La non-conformité manifeste aux conditions de brevetabilité peut donner lieu au rejet de la demande de brevet dans les cas suivants :
Est rejetée, en tout ou partie, toute demande de brevet…
4° qui a pour objet une invention manifestement non brevetable en application de l’article L. 611-16 à L. 611-19
5° dont l’objet ne peut manifestement être considéré comme une invention au sens de l’article L. 611-10, deuxième paragraphe ;
7° qui n’a pas été modifiée après mise en demeure, alors que l’absence de nouveauté résultait manifestement du rapport de recherche.
Dans tous les autres cas, la non-conformité aux conditions de brevetabilité ne fait pas obstacle à la délivrance du brevet. Elle peut toutefois être sanctionnée par la nullité du brevet prononcée par les Tribunaux.”

Lack of novelty and inventive step is excluded as grounds for rejection, as it is defined by Article L611-10 first paragraph (see previous page) and point 5 above only cites the second paragraph of L611-10 (exclusions of patentability), that is word for word equivalent of Article 52(2) EPC and lists non-patentable matter such as discoveries, scientific theories, mathematical methods etc.

What happens in practice is that the INPI³:
- sends the incoming applications to the EPO for searching⁴,
- sends the search report produced by the EPO together with the search opinion⁵ to the applicant, to which the applicant must respond within 6 months (3+3 months) when X or Y documents are cited, otherwise the demand is administratively rejected for lack of answer,
- the applicants amend the claims or files arguments supporting of the claims,
- in case of remaining obvious defects not concerning novelty or inventive step (Art. 611-10, para.2) a communication is sent. Otherwise a patent is granted.

The French patent system does not foresee a post-grant opposition procedure by patent examiners (i.e. technical experts) or an appeal procedure at a second instance within the patent office. Appeals against rejection by the examiner, opposition by competitors and other forms of patent disputes are all treated by a civil court: the “tribunal de grande instance” in Paris 6 . The members of this court are all lawyers. There are no technical members.

The lack of substantive examination and the outsourcing of searches to the EPO explains why the INPI has relatively few examiners, why it seeks to recruit only relatively non-specialised engineers as examiners (“ingénieur généraliste”), and why examiner salaries are relatively low.

The EPO towards the French model
[x] has on previous occasions pointed out that the reasons given by Mr Batistelli to justify his reforms (e.g. “remaining competitive”) do not make sense and asked him what the real plan is⁷. We never received an answer. Any analysis of what is happening at the EPO is furthermore hindered by the fact that Mr Battistelli tends to use a form of Orwellian “newspeak⁸” where what he says can be exactly the opposite of what he means.

By now the outlines are nevertheless becoming clear: Mr Battistelli may be trying to reshape the European patent system after the French model⁹. This is most easily seen by the changes in the examination practice: Mr Battistelli’s continued insistence on “early certainty”, on efficiency (“getting there fast 10 ”) and the ever-increasing individual targets for examiners necessarily led to a strong reduction in the time available per file. The most recent “early certainty” initiative foresees that the majority of applications will see only a single response of the applicants and then a final action, presumably a grant. Under the guise of “areas of competence” senior experts have actually been moved out of their technical fields to other domains. The planned reduction of the backlog foresees further technical “flexibility” of examiners.

The EPO now also seeks to recruit “generalists” instead of highly qualified experts. In doing so it has lowered the initial salaries for examiners, in particular for those with previous experience, making the job unattractive for highly qualified experts. The expected result of the above changes will be a more superficial examination, focusing mainly on formalities – like in France.

Mr Battistelli has been hostile towards the Boards of Appeal from the very beginning of his presidency. Last year Mr Battistelli stopped recruiting Boards Members, up to the point that some 27 of the about 170 posts were unoccupied. This obviously led to massive delays in appeals. The next step is a removal to under-dimensioned offices at the outskirts of Munich. The likely impact will be another brain drain. It very much looks like Mr Battistelli considers the Boards of Appeal “unnecessary”, while absent in the French system. In his “French model” their role could be taken over by the Unitary Patent Court.

Conclusions
[x] supported and still supports and examination model of the EPO that aims at delivering patents with a high presumption of validity (the “German model”), because:
- it provides legal certainty for the applicant who will know at an early stage whether the invention is likely to survive challenges by the competition and hence whether it is worth investing in its development,
- it brings legal certainly for the competitors who will know at an early stage whether to count with a monopoly or not and hence whether to negotiate a license or work around the invention,
- it reduces the risk of unfair competition not only by patent trolls, but also by big companies “squashing” smaller competitors with large patent portfolios and the threat of costly litigation.

Apparently the “French model” works in France. This may be in part because foreign applicants will mostly avoid the French route because of the language difficulties, and the thorough
examination by the EPO thus far protected France from abusive applications coming in via the EPO route. But with the quality of the search and examination at the EPO going down this may no longer be the case. The “French model” thus risks the introduction of a patent system, in France¹¹ and elsewhere in Europe, wherein predictability is not based through a high presumption of validity but on financial muscle: the patent proprietor who can best afford litigation will win¹².[x] does not believe that such a model would really support innovation in Europe.

Should, however, the original EPO model no longer be considered to serve the best interest of the European economy, then a change of direction should be the result of a democratic process following a public debate and not the decision of a President with a cultural bias and possibly an axe to grind.
____
¹ https://www.inpi.fr/sites/default/files/directives_brevet_completes_0.pdf, bold-face added
² Translation: Evident non-conformity to the conditions of patentability may give rise to a rejection of the patent application in the following cases: Applications
4. of which the substance evidently cannot be considered as an invention according to Article L. 611-16 to L. 611-19,
5. of which the substance evidently cannot be considered as an invention according to Article L. 611-10, second paragraph;
7. that have not been modified although the lack of novelty was evident of the search report.
In all other cases non-conformity with the conditions for patentability is not an obstacle to the grant of a patent. The lack of conformity may, however, lead to the invalidity of the patent being found by the courts.
³ http://www.sedlex.fr/brevets-francais/delivrance/lexamen-de-la-demande-et-delivrance-dun-brevet/

http://www.cours-de-droit.net/la-procedure-de-delivrance-du-brevet-a121605180

⁴ Before the EPO existed French patent applications were searched by the IIB, the predecessor of the EPO.
⁵ Before the EPO issued searches opinions French applicants were requested to react to documents marked X and Y in the search report.
⁶ Code de la propriété intellectuelle, article D631-2.
⁷ “A brave new EPO?”
⁸ https://en.wikipedia.org/wiki/Newspeak
⁹ There is still considerable diversity in European national practices. E.g. the grant procedure for national patent applications in Switzerland and Liechtenstein does not require a search and does not involve any substantial examination at all. The patent is granted provided that certain formal requirements are fulfilled. It is possible to obtain a search report during the procedure, but this is optional and has no effect on the decision to grant. See: https://en.wikipedia.org/wiki/Unitary_patent_(Switzerland_and_Liechtenstein)#Grant_procedures
¹⁰ see “Getting there faster – Timely and efficient examination”.
¹¹ We note that the lack of substantive examination in the French system has been criticised within France itself See the paper by Prof. Bertrand Warufsel for the University of Lille: http://www2.droit.parisdescartes.fr/warusfel/articles/warusfelexamenfondbrevetfr.pdf
¹² Strikingly, the US seems to me moving in the opposite direction: http://www.gao.gov/products/GAO-16-490

That last footnote speaks of GOA — the relevance which it (to the EPO) we covered here not too long ago [1, 2]. If the above is an accurate assessment, there should be an uproar/revolt from existing EPO stakeholders, including patent holders. █

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