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06.15.18

The EPO’s Response to the Open Letter About Decline in Patent Quality as the Latest Example of Arrogance and Resistance to Facts, Truth

Posted in Deception, Europe, Patents at 4:16 pm by Dr. Roy Schestowitz

Sums up the attitude of the Office under Battistelli, who uses (or wastes) the EPO‘s savings on media puff pieces and so-called ‘studies’, commissioned (i.e. funded) by the EPO to invert reality

Slick man

Summary: Sidestepping the existential crisis of the EPO (running out of work and issuing many questionable patents with expectation of impending layoffs), the PR people at the Office choose a facts-denying, face-saving ‘damage control’ strategy while staff speaks out, wholeheartedly agreeing with concerned stakeholders

THE WORLD’S patent offices/systems, with the exception of China’s (SIPO), are doing reasonably OK. The USPTO is nowadays in the process of improving patent quality and we commend US courts for that, notably SCOTUS and the Federal Circuit below it.

“The EPO isn’t just above the law; it actively exploits that to break the law, so it has no credibility talking about courts.”The EPO, by contrast, is quite a monster. The EPO repeatedly disobeyed court orders. Corruption at the EPO is just outstanding, not to mention violations of the law, constitutions, and the EPC. The EPO isn’t just above the law; it actively exploits that to break the law, so it has no credibility talking about courts. It seems incapable of grasping the notion of justice. It also assaulted a judge, who is now rumoured to be hospitalised. Several hours ago the EPO wrote: “Next week we’ll explain how to use the European Case Law Identifier to access court decisions on patents across Europe.”

The EPO talking about “court decisions” is as laugh-worthy as dietary advice from Stalin, especially in Ukraine.

But anyway, the arrogance of the EPO is ever more visible in light of the now-famous open letter *, which was published towards the end of this week. We wrote about this back when (or right after) only Kluwer Patent Blog and then IPPro Patents had reported on the matter. There has since then been more, but nothing in ‘mainstream’ media. Battistelli has given enough payments (not at his personal expense) to motivate self-censorship among some of the largest publishers which cover patent matters and used to cover EPO scandals.

Kudos to IPPro Patents for covering this. It’s still rewriting and reposting pure PR/press releases (e.g. today for ANAQUA, as it does for other firms), but at least it covers EPO scandals occasionally. So does World Intellectual Property Review (WIPR), which has been rather useful and interested in SUEPO’s side of the story. This morning it published this article (the sole article about this today, at least as far as we can tell/see; there is also coverage in German with Thorsten Bausch in the mix; Mathieu Klos was reporting). Spotted via news search and via SUEPO and insiders was a seemingly complete list of coverage. Here’s WIPR, which waited for the EPO’s response and then said this:

Four German law firms have published an open letter citing concerns over developments at the European Patent Office (EPO), just two weeks before António Campinos is due to become president of the office.

In particular, patent law firms Grünecker, Hoffmann Eitle, Maiwald, and Vossius & Partner are concerned about “modifications to the incentive systems for the examination of patent applications”.

Published last week, the letter is addressed to both outgoing EPO president Benoît Battistelli and future president Campinos, along with Christoph Ernst, chairman of the Administrative Council, and principal director of user support and quality management Niclas Morey.

[...]

As for recommendations for improvement, the firms “urgently” suggested the creation of new incentive systems for examining European patents so that the “high-quality of searches and examinations for which the EPO used to be known will be guaranteed again”.

A spokesperson for the EPO said that surveys carried out by the EPO and independently, as well as an annual quality report, show that the high-quality levels for which the office is known continue to increase further.

IAM-supported lies, as expected, have come back from the propaganda department of the EPO — the PR team with the ‘usual suspects’ (whose nature we covered here in past years). SUEPO and the Central Staff Committee were right all along. And now the EPO is being shamed by its own stakeholders. Notice the EPO’s vain response. As “Benoit Escobar” put it:

But guys face it: you are all wrong with your comments here!

See what the EPO told to WIPR : this letter is nothing else but “unsubstantiated claims”

https://www.worldipreview.com/news/german-law-firms-raise-concerns-over-epo-patent-quality-16193

They dare!

And to which the response was: “That is what Mr. Ernst (Chairman of the Administrative Council of the EPOrg) told German representatives: bring statistics, otherwise nothing has changed. And the EPO delivers a (self-measured) statistic. As that is the only one readily available, it is the only one he considers to be relevant. To ensure a minimum of independence/ability to counter pressure, change from one VP1 to three VPs (imstead of COOs), the office has grown considerably, these two additional VPs are well defendable within the range of the organisations structure. Then the “Chiefs of Operartions” could actually decide themselves and not fear direct repercussions from PD4.1 and her connection to the president.”

We commented on Ernst’s stance yesterday. He’s acting more like a protector of Battistelli’s propaganda efforts and it makes one wonder what kind of ‘boss’ Ernst will be to António Campinos.

The EPO is alluding to the IAM 'survey' which it immediately cited (after its publication). We’ve commented several times already about what’s wrong with it. By “quality” they do not mean patent quality but things like speed, which can be detrimental for all sorts of reasons that we covered here before.

Looking or navigating through the comments in Kluwer Patent Blog (which is aggressive with censorship nowadays), we’ve picked some more comments that we want to copy to highlight key parts and preserve them (Kluwer Patent Blog had all sorts of technical troubles this past year, with several downtimes lasting as much as a day if not longer).

Here’s a comment on the IAM ‘survey’: “Had they sent around this letter before, maybe le monsieur would have not dared publishing this last Monday: “Delivering High Quality Services – […] User feedback has been gathered through a multitude of channels and has confirmed increasing levels of satisfaction with the EPO’s products and services, year after year”.” (this links to the EPO’s Web site)

It received the following response from “Save the EPO from destruction”: “sure but hey : who believes in Battistelli’s prose ? everybody knows that this is pure PR (euphemism for propaganda) and that the situation is catastrophic. Now at least we have reputed, credible IP professionals who know what they talk about, who clear pull the brakes. So yes, better late than never and again Mr Campinos will face a dire situation with a bloodless EPO in which folly is the new norm.”

Then “MaxDrei”, who used to comment a lot at IP Kat (not many comments there anymore), gave his long message/thoughts:

My comments on the perceived “problems” a) to f):

a) why “must” quality suffer, merely because of a “aim” (which President Brimelow also had) to get to a grant or refuse decision “as quickly as possible”? And as for “within specific allowed times” I never heard it argued that the UK 1949 Patents Act’s hard limit on time to grant has an adverse effect on “quality” in the UK. That said, quality “must” inevitably suffer, if you impose unreasonable productivity targets on hard-working and conscientious Examiners. Worse, the imposition of such targets will generate a shoulder-shrugging “so what” mentality which is the enemy of “quality”.

b) the EPO is not the only Patent Office where its shareholders milk the Applicant community. That Patent Office fees are used a covert tax revenue operation is a different problem from giving Examiners enough time and resources to do a “quality” job of search and examination.

c) What, for goodness’s sake, is an “erroneous” scope of protection? Again, consider the UK Patents Act 1949. It required rigorous examination of clarity and novelty but no examination of obviousness. Everybody knew the Rules of the Game. Nobody complained, that the Office was issuing over-wide claims. My problem at the moment is that Examining Divisions of the EPO are setting too high a standard of clarity under Art 84 EPC. To much “quality” here, rather than not enough. Why that? Because the zealous in-house EPO Quality Police have to be seen (by Chairs of Exam Divisions) to be ferocious, and that is easier accomplished under Art 84 than under Art 54 or 56.

d) What? Patent owners at risk of not succeeding with claim 1 in an infringement action? When in the history of patents was this ever not the case? Upon issue, there is a Presumption of Validity, regardless of whatever level of “quality” the EPO runs at. What more do you want, for goodness’ sake? Spare a thought for the accused infringer, usually smaller than the Big Corp patent owner. Is his protestation, that the asserted claim is invalid, to be greeted with a shoulder shrug and a retort that if the EPO issued it, well then it must be valid? Of course when the Applicant is David and the accused infringer is Goliath, we need a system that delivers “Equality of Arms” to save Little David from obliteration. But merely giving an EPO Examiner unlimited time to examine David’s patent application is nowhere near enough to deliver that necessary objective.

e) See d) above. To nurture the patent system what is needed is a high level of confidence that, if you have an issued claim that is not invalid, you can enforce it speedily and economically, regardless how Big and Ugly the accused infringer is. Complain somewhere else if, in your country, that is not the case. It isn’t the EPO’s fault.

f) I agree. This grotesque surplus suggests opacity and corruption on an industrial scale. But hey, with supra-national organisations that’s the rule, not the exception. Nobody knows yet, how to stop it.

Overall, this Open Letter strikes me as a manifestation of I) German craving for certainty ii) German deference to “authority” and iii) a yearning for the Good Old Days, when if the DPMA granted your patent you were then the proud possessor of an “examined right” which, by definition was valid. Those days are gone. Life today is too complex. There is too much prior art these days, for the Office to know it all. A public prior use somewhere in the middle of Asia is just as novelty-destroying as a patent specification of a German competitor.

One last comment. I’m puzzled by the reference to “incentive systems”. Is this alluding to the idea of “One point for an allowance but two for a refusal”? Is this what troubles you so much? Or is it the never ending “bar raising” of the output productivity targets being imposed on Examiners? If the latter, I agree with you: it’s counter-productive, Mr Campinos. It has got to stop.

Thorsten Bausch I admire your work on this blog. My remarks above are deliberately provocative, to try to whip up a vigorous discussion here. I hope you don’t see my remarks as so offensive that they must be suppressed and denied publication here.

There’s a correction to this.

On why EPO management can barely reject applications (or penalises examiners for it): “One correction – in the middle of the year, the 2 counts for a refusal has been removed. Now examiners get one product for a grant and one for a refusal, irrespective of the amount of work required. Since a refusal has to cover all arguments raised and a grant only has to find one reason to grant, you can guess which is easier to achieve per unit time.”

More on this point and why in light of rumours of layoffs this may mean lower patent quality:

By the “incentive system” the open letter may be referring to the EPO’s career system which currently ties any career progression almost exclusively to the number of “actions” delivered in a given year by an examiner (in other departments, i.e. for staff other than examiners, it is more opaque). Someone here has already pointed out that a refusal has the same weicht as a grant which already has implications for quality. In this context, it is not just an examiner’s career that is affected: Any teammanager’s, director’s or principal director’s career depends entirely on whether a team, directorate or principal directorate has reached the expected number of actions (this now also applies for the BoAs btw).

But worse than the above: Those that are considered to be low performers of underperformers are targeted and threatened with disciplinary measures up to and including dismissal.
If you bear in mind the rumours that werde going around a while ago that the administration was planning mass lay-offs than it should be easy to understand what is going on and the impact this may have on quality.

Also in response to “MaxDrei”:

MaxDrei, don’t you get it? These days, the “incentive” is just not getting thrown out. Grant, don’t ask questions, don’t be difficult, OR ELSE. You’re gonna “do” whatever figure we throw at you.

Many, if not most, who are not anchored down with a mortgage, or are otherwise able to sustain their family, have already left.

Those who stay on have to put up with micromanagement, perpetual harassment, and contempt.

The EPO has deep structural problems that long predated BB, and I think that the alleged “good” results obtained from scapegoating and brutalizing the staff are a nothing but a flash in the pan which will be followed by a painful reckoning.

Alexander wrote about SUEPO’s foresight:

It is nice to see that applicants now realize what SUEPO has been denouncing for several years.
However, what they see as happening with search, examination and opposition has extended also to the Boards of Appeal. The pressure for reducing the backlog is leading to measures which clearly have an impact on the quality of the decisions. The quality of a decision is the quality of the reasoning leading to the decision and nothing else. Hastly and badly reasoned decisions are arbitrary and deteriorate the confidence in the judicial system.
There are still many experienced board members that deliver well reasoned decisions. However, in some years they will retire and be replaced by younger board members that never experienced a working environment in which quality and not quantity is the determining parameter. Reversing this will prove to be a steep mountain.

Here’s a response to that:

Whether and to what extent excessive administrative pressure might prevent members of the Boards of Appeal from taking considered and balanced decisions is central to the issue of their statutory independence, as will probably be examined in the pending German constitutional complaints.
In this respect a very interesting decision by the Bundesverfassungsgericht has just been published, which relates to the constitutionality of the appointment of judges for a limited period of time; see

https://www.bundesverfassungsgericht.de/SharedDocs/Entscheidungen/DE/2018/03/rs20180322_2bvr078016.html

There are numerous considerations there in relation to the required judicial independence which if applied to the Boards – in view inter alia of Judge Corcoran´s sad fate – might result in very dramatic conclusions in the EPO and UPC cases.
The decision has been issued by the second senate which is also in charge of the latter complaints, with the participation of Prof. Dr. Huber, the rapporteur in the same ….

Someone called “epo observer” then spoke of other issues:

Some of the points in this open letter are well taken. For example, the pressure to increase examiners’ production has led to summons to oral proceedings immediately following the applicant’s response to a first communication of the EPO, which is clearly premature.
However, the EPO should also be criticised for failing to consider simple measures targeting the practices of applicants and patent professionals :
– heavily increase filing fees linked to excessive length of applications and/or number of claims
– subject the 2-month extension of the deadline to a response to a fee
– make the fee for “continuation of proceedings” much more expensive than today’s derisory amount.
The EPO should also consider dissuading auxiliary requests, a practice regrettably endorsed by the Boards of Appeal (a patent office has no reason to “baby-sit” applicants).

“Experienced Examiner” (we presume an insider at present) gave these thoughts:

As a prerequisite, please bear in mind that the EPO is a kind of its own. The most striking difference from the point of view of staff is the lack of effective legal remedies. The only independent instance in disputes is the Adminisrative Tribunal of the International Labour Organisation, to reach a decision takes years. This is simpy too long for a labour dispute. I believe you all recall the case of the Board of Appeal member who waited more than 2 years for a judgment, got the case against him thrown out, and was subsequently transferred to another location and job. By the same President who should not have been involved in the handling of the case in the first place. A President enjoying diplomatic immunity and therefore outside and above prosecution, even if making public derogatory comments on the Board member concerned.

The same applies for applicants, opponents and appellants. Early – premature? – summons to oral proceedings, excessive costs for the applicant, the EPO will not cover them. Cancellation of oral proceedings by the EPO, costs incurred, the EPO will not cover them. Financial shenenigans “on industrial scale” as put by Max, nobody aside from the Administrative Council can intervene. And as long as these guys get their renewal fees and some technical cooperation funds, they will not intervene.

The basic message is: the EPO and its top management may do whatever they want, they are unlikely to have to face any consequences, provided they keep the majority of the Administrative Council flooded with cash.

a) Of course it is reasonable to aim for “as quickly as possible”. The EPO puts much more emphasis on the second part “within specific allowed times”. It is not relevant whether a particular case would deserve more time. And believe me, the time we examiners get is pretty short. Some of us stopped reading the description. This will have an impact on quality.

b) I believe the point of the letter is that you pay premium and get mediocre in return. Stated differently, you pay for a Porsche and get a Fiat (no offense intended).

c, d) The EPO is supposed to grant patents with a high presumption of validity. We cannot determine the full scope of protection conferred by a claim and accordingly we cannot examine in this full scope on novelty and inventive step. And as Max correctly says, in any infringement you risk an attack on the patent based on new prior art. Still, the amount of uncertainty you face will depend on whether search and examination were thorough or sloppy. The letter mentions an “increased risk”.

But I believe the letter means more. Patents place restrictions on competitors, and if your products suddenly fall in the scope of a sloppy patent, you need to take action. You will not necessarily file an opposition or start nullity proceedings, but you will need to check whether the patent is valid in the whole claim range, collect prior art, maybe start negotiations. All that could have been avoided by thorough search and examination. Briefly, an undue scope of protection creates additional overhead costs.

e) I see a political message here, that the law firms in question may start recommending to their clients to go national with their patents. The EPO is routinely emphasizing the number of applications received and concludes that everything is fine because the numbers keep rising. Well, once the numbers drop it may be too late.

f) full agreement

Concerning the “German” aspects touched upon, I seriously disagree. In my opinion, the letter does not include anything in this regard. Looks like Max misinterpreted points c) and d). He appears to have overlooked the impact a patent with erroneous scope has on the competitors, as well as the “increased risk”. The law firms are aware that there is and will always be a risk. They question why this risk should be increased. A fair question, if you ask me, considering in particular the “high presumtion of validity” the EPO shall deliver.

Coming to the incentives. The reporting of examiners has changed, it is now “products” only, regardless of how much time you have (I never understood this “product” stuff, we deliver a service). As of now, a refusal which takes much longer than a grant wil be rewarded below the time needed. And you will have to deliver at least the same number of products as last year. Do the math: if you had 10 refusals last year, translating into 20 products, you do again 10 refusals this year and you need 10 additional products to keep up. I venture to say this is quite some increase which does not appear on the balance sheet as such. You need to take a look at the details.

Max mentioned a “shoulder shrugging so what mentality”. I can confirm such a mentality is spreading. If the management decision is to reduce the time we may spend on search, well, we will follow that decision. It is not advisable to deviate or to voice concerns. According to our management, quality is fine, so what? We follow the prescribed routines, and if there is a bit of time left once we are through with that, we do some additional steps – on a good day.

Rumour has it even EPO management has started to notice a drop in quality. Our in-house metrics, as shoddy or as good as they are, seem to indicate a decline, a quite rapid one over the last two years, from 98% compliance to 92% compliance, with a negative trend for the future. According to what I hear, the countermeasure proposed is to lower the benchmark. The quality indicator must remain above the benchmark, regardless of measured quality.

We hope to find more such “insider” thoughts; it helps refute the claims from the PR department and puts greater pressure on it to quit lying.

Curiously enough, even though Hoffmann Eitle has complained about patent quality, “Dominik Scheible of Hoffman Eitle opens the AI panel with a mock-up of a patent for C-3PO,” wrote patent maximalists today. "AI" is a buzzword (revived by the media last year) and it means software patents in Europe i.e. bunk patents that oughtn’t be granted. Examiners at the EPO ought to familiarise themselves with the 4 or so acronyms that the EPO’s management likes to use in an effort to justify granting patents on algorithms (thinly veiled as “IoT”, “4IR”, “ICT” and so on).

Those who found themselves pressured to grant because of some buzzwords (perhaps Line Managers/Directors push towards that) are encouraged to speak out anonymously. We’d love to hear such stories, similar to the leaked E-mails from the EPO's Roberto Vacca.
________
* The full letter reads:

Open Letter: Quality of Examination Proceedings at the EPO

Dear President Battistelli, Dear Dr. Ernst, Dear Mr. Morey, Dear Mr. Campinos,

Each year our law firms file more than 9500 patent applications with the EPO.

For several years now we have followed with great concern the developments at the European Patent Office, in particular the modifications to the incentive systems for the examination of patent applications. The incentive systems and internal directives appear to be increasingly directed towards rewarding or even requesting rapid “termination” of proceedings and a correspondingly higher productivity. This has resulted in penalization of detailed and thorough assessment of cases.

While we do appreciate the increased average speed of the proceedings, such an overreaching desire for high productivity has led to the following, specific problems regarding the examination of patents:

a) When the aim is to terminate proceedings as quickly as possible within specific allowed times, the quality of the search and examination of applications must suffer.

b) The fees for search and examination, which are rather high when compared internationally, can only be justified by giving the examiners sufficient time for an indepth assessment of each single application.

c) Patents that have been examined less thoroughly tend to have an erroneous scope of protection. This distorts and hinders economic competition within the EPC Member States.

d) Proprietors of inadequately examined patents are exposed to an increased risk of their patents not being able to be successfully asserted against competitors in their full scope.

e) If the users of the European system gain the impression that granted EP patents cannot be relied upon anymore due to insufficient search and examination, the users may increasingly be discouraged from filing European patents. This might unhinge the entire patent system.

f) The core task of the EPO is the examination and grant of European patents. This is an important public task, where the EPO needs to balance the interests of the public against the interests of patent applicants. The official fees are supposed to self-fund the EPO. However, in contrast to an industrial company, we cannot see why the profit of the EPO needs to be increased beyond the level of self-funding. From our perspective, the high surplus is rather an indication that the fees are too high and that a further, problematic increase of productivity is not appropriate.

We have observed that our perception of endangered quality of the examination of European patent applications is shared by a large number of patent examiners. As you know, a petition was recently published in which more than 900 examiners at the European Patent Office revealed that they are prevented by the internal directives from a thorough, complete search and examination.

In view of this background, we urgently suggest setting up new incentive systems for examining European patents so that the high-quality of searches and examinations for which the European Patent Office used to be known will be guaranteed again.

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