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09.05.17

Deepening EPO Crisis and a New Report Titled “EPO Patent Filing a Rigged Game in Europe”

Posted in Europe, Patents at 9:22 am by Dr. Roy Schestowitz

God and EPO

Summary: The demise of the EPO and of European Patents (EPs) under Battistelli, a man who fancies himself a god and ignores rationality for the sake of the litigation ‘industry’

THE EPO scandals will pick up the pace again as people return from holiday. We have begun scrutinising it more closely, based on numerous alerting mechanisms and informants. The EPO knows it’s in trouble because it never managed to catch anyone; its ‘fishing expeditions ‘never stopped anybody and neither did the SLAPP tactics (which merely emboldened us to write even more). Blocking Techrights accomplished almost nothing as people like EPO insiders can still read the site outside work. Many former EPO staff tell us that they too follow these developments closely. The EPO never caught us in a lie. We published nearly 2,000 articles about it.

“How much money has Philips wasted on EPs, whose value is likely to have vastly diminished due to the EPO’s failings?”The head of the European Patent Organisation is about to leave. He was preceded by Battistelli, who is also going to leave (next summer). Guess who else is leaving…

Head of patents at the top EPO patenter (as per filings), Philips. How much money has Philips wasted on EPs, whose value is likely to have vastly diminished due to the EPO’s failings? Remember that Philips has been a patent bully that uses proxies like Sisvel to attack and rob innocent companies at expos. Philips is definitely a patent aggressor, it just outsources the shakedowns to other firms. Sisvel, by the way, was presenting alongside the EPO not too long ago in Turin.

The news about the Philips departure was probably broken by Battistelli's favourite fake news site. It said this yesterday:

Brian Hinman, chief IP officer at Philips, will be leaving the company in the middle of this month, IAM can reveal. The departure is entirely amicable and has been driven by Hinman’s desire to be closer to and spend more time with his family. Since taking the position in 2013, Hinman has split his time between the US and Philips HQ in Eindhoven, and now wishes to re-establish himself full-time State-side.

Why did he leave after all this time? We’re not easily buying the template of “spend more time with his family.” We saw similar claims from the head of the European Patent Organisation; it later turned out, based on rumours, that his government actually fired him (albeit politely, giving him the chance to step down). We were never able to verify this based on hard documents, but the source of this claim is quite credible.

“Raimund Lutz says Germany’s Constitutional Court has asked for comments on the UPC lawsuit.”
      –Managing IP
The EPO cannot deny the fact that there is a crisis. The European Patent Organisation said so explicitly in an internal document. It used the word "crisis". It’s also difficult to ignore the fact that IAM refuses to cover any of this. Managing IP too hasn’t mentioned it in nearly a year. Right now it is (once again) organising a pro-UPC event where keynote speeches are from the EPO, namely the architect of Battistelli’s regime and facilitator of human rights abuses, according to EPO insiders. A laster tweet said this: “Raimund Lutz says Germany’s Constitutional Court has asked for comments on the UPC lawsuit.”

So here we go again, Managing IP as UPC and EPO management’s megaphone.

Managing IP is promoting this thing today. It’s in Munich. Just serves to remind us of the incestuous relationship between EPO management and some of the media…

The patent microcosm too is culpable in the sense that the vast majority of it chooses to remain silent, unwilling to speak out against what is clearly breaking the EPO apart. Juve‘s poll/survey showed that Battistelli had a 0% approval rating among the respondents (a fact that was later recklessly spun by the EPO, internally).

Yesterday, writing about the subject more than 2 months late, Roschier’s Anne Kyyrö and Vilhelm Schröder wrote about admission from the European Patent Organisation that EPs had been granted in error:

On 29 June 2017, the Administrative Council of the European Patent Organisation (EPO) made a decision by which it intends to change the earlier practice of the EPO regarding the patentability of products obtained by an essentially biological process. Said decision of the EPO amends Rules 27 and 28 of the Implementing Regulations to the European Patent Convention (EPC) by inter alia stating that plants and animals exclusively obtained by means of an essentially biological process will no longer be patentable. The decision entered into force on 1 July 2017. The amended rules are not only applied to European patent applications submitted on or after 1 July 2017, but also to European patent applications and European patents pending at that time.

The ramifications of this are huge and we wrote half a dozen or so articles about it. What happens now that people (or corporations) with EPs realise that they can lose these EPs overnight, without even a trial/appeal rights?

More interesting was this article from yesterday, which had been titled “Is EPO Patent Filing a Rigged Game in Europe?”

They have since then changed the headline to “Here’s Why the Current Patent Filing System May Be Stifling Innovation” and it covers ‘legalised’ tax evasion through patents (Patent Box regime was covered here many times before):

The Patent Box Regimes

Another important decision is to choose in which country bring the intangible asset to be protected. The larger the size of the taxpayer, the more money being managed, the greater the financial administration being more tolerant to the potential contributor. The consequences are many: the taxable amount payable in the country with the highest tax decreases, whereas the tax base to pay in the country with lower taxation increases. In this way, there is a detriment to the more expensive country, a benefit to the less expensive country and an additional benefit for the shareholders of that company.

Which countries demand less taxes? Switzerland does not attract much, in Europe every country sets the rates it wants and for this reason, the biggest companies in the world have transferred trademarks and patents to the Netherlands and Ireland where taxes are very low.

With the 2015 Stability Law in Italy, the Patent Box was introduced. Currently, income from patents and trademarks are subject to a tax of 31.4%, with the Patent Box it will halve to 16%. In France, the Patent Box was introduced in 2000 and provides for a 15% tax. In Hungary, introduced in 2003, a tax of 9.5%. In the Netherlands, introduced in 2007, a tax of 5%. In Spain, since 2008, 12%. United Kingdom, from 2013, 10%. Belgium, since 2007, 6.8%. Cyprus, from 2012, 2.5%. Malta, since 2010, there is no taxation. Switzerland has, since 2011, 8.84%. Portugal, from 2014, 15%. Europe is becoming increasingly weakened by “tax wars”.

The article’s author then wrote about centrally-managed nepotism at the EPO — a subject first exposed by Techrights with this leak — an important leak that was later covered in international media and resulted in many face-saving moves from the EPO, then threats of lawsuits (SLAPP). Here is what it says:

The European Patent Organisation (EPO)

While this war is played, Munich decides: inventors and small and large companies from 38 European countries have to submit their patent application to the EPO (European Patent Office). The European Patent Office examines the applications and finally it decides whether to grant or refuse the patent. It takes roughly four or five years.

The procedure isn’t always fair. Companies such as Canon, Philips, Microsoft, Qualcomm, BASF, Bayer, Samsung, Huawei, Siemens, Ericsson and Fujitsu receive “V.I.P. treatment” from the EPO, although most of them are not even European. Due to the fact that they carry real money, they receive dedicated assistance and more attention. In conclusion, it goes against small inventors who will spend years and much more money to protect their idea. An outsider might well argue that the EPO operates like a business rather than a public service (to Europeans).

The EPO does not depend on Europe, it is not part of the European Union. It is a private institution that has immunity. So who controls the controller? The Administrative Council is made up of representatives of the member states. There is also the European Commissioner, who is an observer within the Administrative Council. However, there is no supranational authority independent of the council that exercises control over EPO’s activities.

The article correctly concludes by saying that “US applications have decreased substantially, while Japanese companies have presented a slightly lower number of applications.”

Yes, the EPO is running out of work. This will, inevitably, mean a lot of layoffs.

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