12.19.18

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UPC Would Mean Patent Scope Gone Out of Control and Beyond/Above the Law

Posted in Europe, Law, Patents at 10:04 pm by Dr. Roy Schestowitz

Plants, algorithms and other patent-ineligible things should never become monopolies

“The European Patent Office is an executive organisation, it deals especially with patent applicants, as such, its view of the world may be biased. As an executive organisation, its interpretative powers are very limited. The European Patent Convention excludes computer programs, it is outside the EPO’s power to change this.”

Ante Wessels, FFII

Summary: Debates about the EPO’s inability to respect the law and to maintain modest/reasonable patent quality are a reminder of why the UPC is, in effect, a dead end

THE staff of the European Patent Office (EPO), especially staff which deals with examination, can’t be very proud of the devaluation of European Patents. People whose job performance is assessed by a bunch of numbers/figures like patent grants or “products” may feel victorious, but to turn the EPO into another USPTO would be a low goal; it would even be an own goal.

“The EPO does a very fine job discrediting itself if it grants such patents, finishing what’s left of its already-harmed reputation and especially the credibility of European Patents.”The perils associated with quality of European Patents were brought up again early in December. A surprising new decision represented a threat to farmers and to the EPO's own reputation. Barbara Rigby from Dehns (Team UPC) more recently wrote about that awful decision to grant patents against the EU and against the EPC as if the EPO is above the law and can just make up the rules.

“In a surprising turn of events,” she said, “on 5 December 2018 a Technical Board of Appeal of the European Patent Office (EPO) decided that plants which are the products of essentially biological processes are not excluded from patentability. The decision (T 1063/18) is a twist in a long-running saga, but may well not be the final word on the matter.”

The EPO does a very fine job discrediting itself if it grants such patents, finishing what’s left of its already-harmed reputation and especially the credibility of European Patents.

“It is interesting,” Rigby added, “that the Technical Board of Appeal did not consider it necessary to refer this matter to the Enlarged Board of Appeal. However, the patentability of plants is a controversial topic and many stakeholders on both sides of the debate hold strong views. It would therefore perhaps be premature to think that decision T1063/18 signals the end of this saga. A future referral to the Enlarged Board of Appeal (in connection with a separate appeal) is not inconceivable, so for now, legal uncertainty remains. It remains to be seen if and when the EPO amends Rule 28(2) EPC. We will provide updates as and when new developments arise.”

This may very well become a new/latest major scandal, maybe not among patent law firms. David Brown (Haseltine Lake LLP) wrote about this awful decision: “It is reported that, at a hearing on Wednesday 5 December 2018, the EPO Technical Board of Appeal 3.3.04 in the case T1063/18 (Syngenta’s Pepper Plant Application No. EP-A-2753168) decided that Rule 28(2) of the European Patent Convention (EPC) is incompatible…”

We have already started to see coverage not from law firms. The Courier, for example, writing under the “Farming” section, went with the headline “Patent ruling puts plant variety breeding at risk” and then explained further:

EU farming leaders have warned that plant breeders could lose vital access to natural genetic resources as a result of a highly contentious ruling by the European Patent Office (EPO).

Copa-Cogeca, who represent Europe’s farmers and farm cooperatives, have expressed “shock” over a recent EPO ruling relating to new pepper plants, which they say could make the breeding of new plant varieties from ”natural traits” subject to patents.

This is in contrast to the current exclusion of “natural traits” from the patent process, an approach which has left the protection of new plant varieties to be governed by a licensing system, which Copa-Cogeca argues is working perfectly well.

Thor Kofoed, chairman of Copa-Cogeca’s Working Party on Seeds said: “We don’t need a patent system for plant breeding in Europe as we already have Community Plant Variety Rights, which has been the most efficient system worldwide for the past 50 years.”

Staying with plant variety licensing is also the preferred choice of Professor Colin Campbell, chief executive of the James Hutton Institute, home of countless plant variety developments over the years.

“The institute has produced many successful new crop varieties via conventional breeding methods and are famous for their Glen raspberry and Ben blackcurrant varieties,” said Prof. Campbell.

This is the kind of thing that harms condfidence in the EPO’s ability to decide on patent scope or patent validity; it’s not even complying with the EU’s own rules. They’re not even in agreement on this very fundamental question which is patents on seeds.

Just before the weekend a comment was posted in IP Kat to say:

You consider that “The EPO is being entrusted with the Unitary Patent”. This is not completely correct. It is entrusted with keeping a register of UP and to collect the annual fees for UP. It is difficult to see in those two points the full responsibility of the EPO for UP.

Getting to decide which are and which aren’t valid patents is a very big deal, including opposition proceedings. That gives the EPO enormous power over patent scope — a power it has repeatedly and patently misused.

On the other hand, you put the finger on one of the big drawbacks when it comes to the UPC.

What if, in matter of validity, the case law of the UPC will differ with the case law of the BA and more with that of the EBA. This is a fundamental uncertainty, and I would say flaw of the UPC system. At least between the EFTA court and the CJEU there has been an agreement to exchange information. Between the UPC and the EBA/BA nope. This must have a reason. May be the aim behind this is the end of the EBA/BA?

On the other hand, why should 10 states, some of them having also a strong economic holding, but outside the EU, accept judgements of a court only acting within the EU?

These courts aren’t even discussing the case in the defendants’ language/s. But there are even greater and more blatant infringements — more of which were discussed here before.

There would have been one solution that is for the UPC only to deal with infringement, and let the EBA/BA decide on validity. A kind of general bifurcation to use a naughty word.

Given the abuse of power by the Office, which attacked the appeal boards time after time, and considering the Office’s violation of the EPC (e.g. on patent scope), this is just unacceptable. If the Office President gets to decide what is and isn’t valid, even when national courts do not agree, that’s an incredible amount of leverage to exercise over the decisions of the court.

This would mean that the opposition period would have to be extended to the life time of the patent, and not merely limited to 9 months. After all, a proprietor may amend its EP during its whole life, thus why limit the possibility to challenge the patent centrally only for 9 months after grant?

This could have been good for unification of law within Europe, and would have avoided any clash of case law. This solution would certainly not be to the liking of all the lobbies who absolutely wanted the UPC, for whatever reason.

In this system, validity could be assessed in a consistent way by a court systematically composed of technical judges, and not just by technical judges which are all in a pool, and can be called or not at the discretion of the judges sitting in the local or regional courts of first instance of the UPC.

When it comes to infringement, then the UPC could act, but only on this point.

By deciding both on infringement and validity, clashes are necessarily programmed. Just look at the way added subject-matter is dealt with at the EPO. It is not a secret that the way added matter is looked at by the BA/EBA, is very strict, and for good reasons, but to the dislike of plenty of users. By doing so, they actually forget that the added-matter and novelty are the two sides of the same coin: what you lose on on side you gain on the other.

The way things stand at present, validity decisions are improperly dealt with, e.g. with growing burden on challengers because the Office tries to mask the decline in patent quality. Having the EPO at any phase/part of the legal process is therefore a problem.

Let’s take the example of the German Federal Court (BGH): if an independent claim comprises a feature extending over the original disclosure, the unallowable feature is merely to be disregarded when assessing patentability, cf. X ZR 161/12 (Wundbehandlungsvorrichtung=Wound treatment device). This means that the application is refused and the patent revoked.

Before the EPO G 1/93 (the inescapable trap) is valid. When it comes to added subject-matter during examination, then the position of the BGH is the same as the BA/EBA. See BGH X ZB 5/16 (Phosphatidylcholine).

Imagine we end up with a similar situation when it comes to the UPC. Is such a difference in legal approach, on actually the same legal text (Art 100-Art 138 EPC) in the interest of European Industry, and especially SMEs? I have some doubts.

The whole UPC system has been rushed into place following an intense lobbying whereby the apparent interests for SMEs has been used as a fig leaf. Politicians have not been aware of what was coming on. A last point: filings at the EPO stemming from EU member states count for at most for a third. That means that two thirds come from outside the EU. As the number of grants more or less follow the same distribution, I have not yet met anybody capable of explaining, how this can be profitable for European Industry and especially the SMEs.

These are some rhetorical statements. Of course the UPC would be bad for Europe, bad for SMEs, and mostly the result of intense lobbying by patent trolls and firms that represent them. All they want is lots of patents — questionable ones included — and more leeway for litigation. Businesses are expected to just supply mountains of money to Team UPC or the litigation ‘industry’; it is unequivocally a tax on innovation.

The bottom line is, the discrepancies between EU law and what the EPO does is a real problem; it shows that an international institution positioned above the law (and routinely exploiting that) cannot be trusted with something like the UPC.

Concerns associated with European patent law, especially scope, are nothing too new. These concerns are some among several that exist.

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