07.27.17

Value of European Patents (EPs) is Diminishing, EPs Get Invalidated, and EPO Insiders Bemoan the Management’s Lies About Patent Quality

Posted in Europe, Patents at 4:01 pm by Dr. Roy Schestowitz

Summary: EPO insiders (or affiliates nearby) explain just how bad patent quality has become — due to the management’s policies — and why it poses a threat to the attractiveness of the EPO (where the number of patent applications is already declining)

THIS is precisely what we’ve warned about. For nearly a decade of covering the EPO. The bar has been lowered so much that, according to IP Watch (earlier today), “Companies Prefer Trade Secrets To Patents To Protect Innovation, EUIPO Finds” (interpretation/analysis of the cause notwithstanding).

“In some people’s minds, the EPO is a failed institution whose remaining momentum is owed to its past glory.”They’re not wrong. Based on people whom I speak to regularly, the image of the EPO and the prestige — so to speak — of EPs just isn’t there anymore. In some people’s minds, the EPO is a failed institution whose remaining momentum is owed to its past glory. A lot of technical people in the UK read The Register and what they see there about strikes and tyranny not only repels them; it also harms the image of the EU. Such is the legacy of Battistelli…

A sister site of WIPR weighed in by mentioning a decision from Monday, albeit not directly noting that EPO grants of weak/bogus patents finally result in mass invalidations. It inevitably causes a reduction in the certainty of EPs and hence their overall value (real or perceived) — something that no stakeholder should be pleased with.

To quote:

A European Patent Office (EPO) Board of Appeal has published its decision that invalidated a patent owned by Bristol-Myers Squibb (BMS) which covered a blockbuster anti-cancer drug.

Published on Monday, July 24, the decision invalidated European Patent number 1169038, a composition-of-matter patent covering dasatinib.

Dasatinib is a targeted therapy used to treat leukaemia sold under the brand name Sprycel. In 2016, the drug obtained worldwide revenues of $1.8 billion.

So another EP bites the dust. It should never have been granted and we can expect a lot more of that now that examiners are pressured to 'produce' more.

As mentioned here yesterday (we still hope that someone will leak the full text to us), EPO management now conflates time with quality. People were rather shocked to learn this. As the following comment put it:

That last comment from Anonymous made my jaw drop. Assessing “quality” on the basis of what one can measure? Seriously?

Amongst the things one can measure is the gap in time between paying the search fee and getting the search report.

Amongst the things one cannot measure is the “quality” of the search.

But nevertheless, EPO management announces that quality has increased, purely because the search reports are issuing faster.

What a joke!

Referring to the Croatian/German scandal we are covering (there's a lot more on the way), someone then wrote this:

Apparently, the content of the search or examination is of little interest to the department responsible for quality control, important is that they are out fast!

This sounds like the pioneering approach adopted by some smaller national IPOs a few years ago. Nice to see such techniques being successfully exported to the EPO.

“The acceleration of the administrative part of the proceedings, and thus the overall decision-making process on the merits of the matter, is in the interest of both the requester and the holder of the trademark.

In other words, upon receipt of a request for cancellation of a trademark, if it is in order, as required by Article 47 of the Trademark Act (Official Gazette 173/03, 76/07 and 30/09), the Office is required to forward the request to the holder of the trademark without any examination of the substantive merits, which was also done in this case.”

http://www.portaloko.hr/clanak/navode-oko-koruptivnih-djelatnosti-uz-slucaj-frgacic-u-potpunosti-odbacujemo/0/3812/

Since this whole threat is so old and marginalised (the ‘Kats’ give no newer opportunity to comment on EPO scandals without going off topic), we wish to reproduce today’s remaining comments as well (all 3 of them). Alison Brimelow (Battistelli’s predecessor) was mentioned below:

I see now that I was too quick to express my disgust, how the EPO measures “quality” of assessing patentability.

If I gather it right, the EPO does not claim that search quality has improved. Rather, the assertion is that it has “never been higher”. The difference is crucial. For any assessment that requires more than bean-counting or number crunching, the “never been higher” mantra is a safe one to utter, regardless how much it flies in the face of what we all know. Still, once BB defines “quality” as “timeliness”, he can of course get the answer he craves.

Thus, Donald Trump can safely assert that there has never been a US President of higher “quality” than himself, because never has a President spent fewer working days in The White House. He must be the greatest Decider of all time, right?

Or the NHS can safely assert that the “quality” of orthopaedic (or brain) surgery in English hospitals has “never been higher” because each patient today spends fewer days in a hospital ward than used to be the case.

As Alison Brimelow urged, getting EPO search reports out on time is important. But the core quality of the search is something entirely different. Just suppose that, even as we speak, “core quality” is going down, just as fast as “timeliness” is going up. If the EPO President defines “QQuality” as the aggregate of core quality and timeliness, then “QQuality has never been higher” than it is today, even while core quality is worse today than it has ever been.

Then an explanation of why quick decisions are not necessarily desirable — a point made recently by Thorsten Bausch (Hoffmann Eitle):

It is quite ironical that at the time when the EPO pushes for quick grant, the UK IPO has published a blog warning about the deleterious effects a quick prosecution might have.

https://ipo.blog.gov.uk/2017/07/13/queuing-the-rule-of-6/

The most relevant part:
Can this [the grant procedure]be sped up?

Yes, but you should think carefully about whether a fast grant is in your best interests. For example, the earlier your patent application is published, the earlier the technology is in the public domain [at least quick publication can be avoided, as eventually all applications are published at 18 months].

Many applicants are happy to proceed to grant at a slower pace. This enables them to develop and plan the commercialisation and marketing of their invention, whilst the patent application process continues. It also gives them time to determine whether their invention is commercially viable before committing to a greater financial outlay.

Comment:
I doubt that anything more can be said, but that the communication between the EPO and some of the national patent offices appears to be sub-optimal, to say the least!

Finally, some figures from someone who knows things from the inside (on the face of it):

What people should know is that examiners do not have the time to do their job. Let me explain:
-examiners have an objective at the beginning of the year, let us say 100 files.
-these 100 files should be examination and search, e.g. 50 searches and 50 examinations or 60/40, etc…
-only end actions count in examination, so the 50 examinations can be 50 grants or 40 grants and 10 refusals, etc…
-if you don’t get your objective, you have a problem.

Basically, a few years ago the objective was reasonable. Say, you got 100 files to do and you could end up with 60 searches, 35 grants and 5 refusals.

Today, we have the combination of several factors at the same time:
-it is not 100, it was increased to 120 or 140 or more (examiners have no say in that, they can object an unreasonable increase but the complain will not lead anywhere). Let us say 120.
-the office is hiring plenty of new examiners, they get a high proportion of the searches (because they are starting, they have no stock).
-consequently, experience examiners get less searches. For example, for the 120 files objective, you would normally need 75 searches, but your director has only 30 in stock for you for the whole year. Suddenly, you need to do 120-30=90 examination files.
-now for the good part: only final actions count, but refusals take at least 6 months more. You need to summon for oral proceedings. You can either do your job correctly (and then you end up with 30 searches, 50 grants and 40 summons and are 40 files short or your objective as the summons do not count) or grant a few more “borderline” files to get to your objective.

I think that the only way out would be if the industry (applicants, representatives) would start to file oppositions massively. We still take the time to do a proper job on opposition files, while we don’t on pure examination files.

Very interesting and important comments have been relegated to a thread from about four months ago, buried deep in pagination (due to the number of comments posted there since). It probably won’t be the end of this thread about how quality of patents at the EPO went downhill. We’ll continue to keep an eye on followups because therein exist opportunities to pull anonymous insights from inside the Office. █

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