08.31.19

The Judges of the Boards of Appeal Are Still Controlled by the European Patent Office and European Patent Quality is Therefore in a Freefall

Posted in Europe, Law, Patents at 1:39 pm by Dr. Roy Schestowitz

All the Boards are swinging off the Office, which they were supposed to govern by enforcing the EPC (instead of appeasing the debased President of the Office)

Summary: The lack of justice at the EPO is very much profound and “Munich is officially the new Eastern District of Texas—but on steroids,” according to Florian Müller

THE European Patent Office (EPO) is running out of time. António Campinos kept Team Battistelli in tact and he maintains all the same policies. This end-of-week tweet said they “modernise our [EPO's] IT systems,” but actually they’re wasting a quarter billion euros on a system that does not work, then canning it silently. Leaked details on CQI have revealed that today’s EPO is all about patent maximalism, nothing else! Grant, grant, grant! If in doubt, grant! It’s a credibility crisis. The EPO became like a ‘diploma mill’, with officials who are alleged to have faked their degrees.

“It’s a credibility crisis.”The EPO’s overzealous approach towards patenting (or patent policy/scope) has attracted growing levels — as well as severity — of scrutiny. German blogger Florian Müller wrote some blog posts about it this past week and also a bunch of "tweets" (not formal), including unprecedented rants (there are more, but less noteworthy, e.g. [1, 2, 3, 4]).

“Munich court will decide tomorrow at noon,” he said. “If this hearing ends the way the first hour went, Munich is officially the new Eastern District of Texas—but on steroids,” he added.

We’ve warned about it for years. And now it’s undeniably happening!

“The EPO’s overzealous approach towards patenting (or patent policy/scope) has attracted growing levels — as well as severity — of scrutiny.”“Pro-patentee extremism on full display at Munich I Regional Court,” he later heralded. “The Munich court appears extraordinarily eager to order a patent injunction against Daimler. They don’t want anything to get in the way. Gotta grant them one thing though: protectionists they are not,” he added. In another tweet he said: “The Munich court won’t adjudicate Nokia‘s anti-antisuit motion against Continental AG from the bench. They‘re going to decide after further deliberation.”

He later summarised everything in the blog posts [1,2,3] below. They’e more detailed than “tweets” and there are official documents there as well. These “tweets” were tucked into some of the articles, which is fine (it takes longer to write long-form articles than mere “tweets”). Müller generally shares our views on the EPO. The EPO isn’t good for Germany or for the German economy; it’s only good for some German or Germany-based (or with branches in Germany) law firms.

As long as the EPO keeps granting software patents in Europe we’ll continue to see the likes of Müller complaining. After all, actual software developers do not want and do not need such patents.

Before the weekend the EPO tweeted: “Germany is the established leader in self-driving vehicle innovation in Europe. But would you have predicted the second- and third-placed countries?”

“The EPO isn’t good for Germany or for the German economy; it’s only good for some German or Germany-based (or with branches in Germany) law firms.”These are mostly software patents on stuff like computer vision and geometry, i.e. maths. Fake patents and easily-debunked/easy-to-invalidate patents oughtn’t be granted in the first place, but the EPO keeps promoting a bunch of buzzwords like “SDV”. In Singapore they like to speak of “FinTech” and even accelerate patent applications that adopt this buzzword.

Days ago a bunch of Asian sites (AsiaOne, Viet Nam News and Business Insider in Malaysia) said that “[t]he European Patent Office (EPO) has seen a growing number of patent applications from Singapore” (all in all, patent applications are decreasing in number, so Christoph Ernst et al would rather cherry-pick nations for the appearance of ‘growth’).

All these sites have the same article, which is a puff piece in which Christoph Ernst reveals himself as ‘tool’ of patent maximalists. To quote a couple of portions:

Dr Christoph Ernst, Vice President of the EPO, Directorate General Legal and International Affairs, said: “Asia is a major centre of innovation worldwide and there is a rapidly growing number of patents from this region. It has become evident that the EOP has been receiving a rapidly growing number of patent applications from this (Asian) region.”

[...]

Dr Ernst said the collaboration between IPOS and EPO has strengthened over the years. About 53% of the 170,000 patent applications received in recent years originated from outside the EU member state system — mainly from the United States, Japan, China and Korea. “Particularly noteworthy is that patent applications originating from Singapore increased by 20% last year to now 523 applications,” he added.

Why would IPOS want to associate with corrupt EPO officials? How did this article come about? It’s pure marketing. It’s also somewhat misleading. But this is what we’ve come to expect from mainstream media; it ignores EPO corruption and only ever says good things about the EPO. So do most law firms.

One booster of the UPC has just promoted through Lexology its article about appeal procedures changing:

On 1 January 2020, the rules governing procedure in ‘Appeals of Decisions’ made by the European Patent Office (EPO) will be changed. The new rules will bring in a host of changes relating to the procedure for appeals. One of the most significant changes will see a restriction on arguments, requests, amendments and evidence that appellants can submit. Appellants involved in existing appeals proceedings (and indeed anyone involved in ongoing examination or opposition proceedings) may want to consider taking action before the new rules come into force to ensure they have the best chance of success in a current or future appeal.

Most appeals at the EPO are from decisions of the Examining Division or the Opposition Division. The Examining Division has primary responsibility for determining whether an invention covered by a patent application is new, inventive, and meets the other criteria of the European Patent Convention (EPC) required for grant of a patent. If the Examining Division refuses to grant an application with an acceptable scope an appeal can be filed by the applicant.

David Lewin, James Ward, David Brown, Robert Margue and David O’Connell (Haseltine Lake Kempner LLP) also wrote about it a few days ago and they’re missing the point — perhaps intentionally — that these Boards of Appeal have zero independence. From Mondaq:

The “convergent approach” has the potential to require patentees to formulate their best sets of claims as the Main and Auxiliary Requests during the first-instance procedure, possibly allowing only necessary adjustments (a) in reaction to the first-instance decision (first level), (b) following developments during the early part of the appeal procedure (second level), and (c) in final preparation for, and at, the appeal hearing (third level).

[...]

The general applicability of the second level of the “convergent approach” from 1 January 2020 urges all parties to EPO appeal proceedings to check that all necessary documents, particularly a patentee’s best claim requests and an opponent’s best attacks, have been provided, and to remedy any deficiencies before 31 December 2019.

Also in Mondaq their colleague (co-author of the above) published “Is A Prima Facie Inadmissible Appeal An Appeal? And If It Is, Where Is It?”

Robert Margue (Haseltine Lake Kempner LLP) belatedly weighed in on the notorious case that showed the Boards’ lack of independence and coverup that ensued.

The Enlarged Board of Appeal of the EPO recently had to decide (G 2/19) an intriguing question arising from the relocation of the Boards of Appeal to the municipality of Haar in the Munich district, which lies outside the boundaries of the city of Munich. The question arose on the back of an Appeal filed by a third party against the grant of a European patent, which had the aim of correcting the allegedly unjustified grant of unclear patent claims.

European Patent EP 2 378 735 B1 was granted on 8th February 2017. During examination proceedings prior to grant of the patent, 3rd party observations had been filed on several occasions by European Patent Attorney P in accordance with Art. 115 EPC. According to the second sentence of this Article, any person who files 3rd party observations does not become party to the proceedings. The only party in the examination proceedings is the sole applicant.

We wrote a whole bunch of posts about the composition of the Board. It refused to even deal with the key question!

“…inverting narratives means that a defender/defendant is framed as an “attacker”.”Going back to Lexology, the other day it promoted this misleading post that frames challenges to weak/bogus patents as “attacks”. It’s that same old propagandistic spin; challenging likely fake patents is not an “attack”; the attacks are these patents being used for lawsuits; inverting narratives means that a defender/defendant is framed as an “attacker”. Here they go again:

On 30 July, the Court of Appeal of The Hague ruled on the formal entitlement to priority following from a US provisional patent application (judgment in Dutch here). The attack on priority in this case is part of a recent trend by parties in patent litigation which aims to challenge entitlement to invoke priority under the Paris Convention and the European Patent Convention.

We’ve meanwhile noticed the same inversion of roles in Bloomberg’s patent maximalists’ section. It wrote about the Patent Trial and Appeal Board (PTAB) that it’s a “Patent Attack” (actually, PTAB helps prevent frivolous attacks). To quote:

New Patent and Trademark Office guidance discouraging simultaneous attacks on the same patent has left practitioners uncertain about using that strategy to seek administrative reviews.

The agency in July said parties filing more than one validity challenge against a patent “at or about the same time” for a Patent Trial and Appeal Board review should explain the differences between and rank them in order of importance. Filing a single petition “should be sufficient” in most situations, the agency said.

Some practitioners are worried that the PTAB may start dismissing some legitimate challenges just because parties file several petitions.

“The European Patent Office (EPO) is not supposed to control any Boards of Appeal, but right now it controls all of them. It even ‘made an example’ of Patrick Corcoran.”Müller bragged that he had been mentioned in this article. “Quotes me as saying there’s no hard evidence of widespread #PTAB abuse,” he tweeted, “new rules to reward those who manage to weak patent claims granted by #USPTO, doesn’t incentivize innovation…”

Going back to the EPO, its PTAB equivalent (BoA) is not functioning. The EPO is certainly granting far too many fake patents and it’s being noticed, albeit not by the Boards. The European Patent Office (EPO) is not supposed to control any Boards of Appeal, but right now it controls all of them. It even ‘made an example’ of Patrick Corcoran. So there’s an actual bite, not just barking.

Three days ago Inventiva bragged about a new European Patent [1, 2]. But does Inventiva know that many European Patents are fake and not legal? Does it realise that many of these patents aren’t usable in court?

On the same day Bart van Wezenbeek wrote in Kluwer Patent Blog about Forschungszentrum Jülich GmbH vs Advanced Neuromodulation Systems, Inc.

Here’s what happened:

The European patent was opposed by the appellant on the basis of lack of novelty and inventive step. Although the opposition division raised of its own volition an objection under Art. 53(c) EPC they decided to reject the opposition. The opponent appealed and argued that the invention would not be patentable on the basis of the aforementioned grounds. In the summons to the oral proceedings the Board of Appeal mentioned a possible new ground based on lack of industrial applicability. On the basis of the preliminary opinion the patentee filed 4 auxiliary requests. During oral proceedings the Board mentioned that it might change its opinion on the basis of the case law (T 775/97), whereupon a new auxiliary request was filed.

Had examiners been given more time to assess such patents, there wouldn’t be a backlog of about 10,000 (no kidding!) appeals. This just isn’t sustainable.

Physician’s Weekly has just reposted Reuters. Likely fake (bogus) patents are being assessed: “Alexion also awaits an impending European Patent Office (EPO) decision on its patent applications for Soliris, to extend the drug’s PNH market exclusivity in the European Union to 2027.”

“If Europe fails to maintain the high patent quality it was once renowned for, it won’t serve science and innovation. Instead it’ll serve law firms and litigation.”What we’re seeing right now in Europe is a bunch of errors being repeated. They replicate the US patent system and American chaos as it were a decade back when patent trolls were thriving and patent justice was too expensive and thus a rarity (no IPRs, no PTAB). The inter partes reviews (IPRs) help eliminate bad patents more trivially and quickly, on the cheap…

Patent maximalists are losing everything in the US. Watch them at an extremist site, Watchtroll. Greedy law firms that hate science write there (latest headlines are “Alice: Benevolent Despot or Tyrant? Analyzing Five Years of Case Law Since Alice v. CLS Bank”, “Latest Federal Circuit Ruling on 101 Strikes Down Mallinckrodt Method of Treatment Claims; Newman Dissents” and “Have Federal Circuit Judges Summarily Affirmed Your Patent Appeal Without Explaining Why? Tell SCOTUS”). Robert Sachs has let the mask slip; his hatred of Alice/Section 101 he now unleashes openly at Watchtroll, Nathan Lewin is using Watchtroll to attack the Federal Circuit and that third one is familiar. Agenda such as this was brought back by Dennis Crouch the other day (he had been doing it for years). They try to reduce patent quality again.

If Europe fails to maintain the high patent quality it was once renowned for, it won’t serve science and innovation. Instead it’ll serve law firms and litigation. █

Related/contextual items from the news:

1. Munich court hell-bent on pre-emptive strike against Judge Koh’s jurisdiction over Continental antisuit injunction motion against Nokia

   While I doubt rather strongly that the Avanci patent pool firm’s U.S. venue transfer motion (from San Jose to Dallas) will succeed, Avanci contributor Nokia may help that entire group of patent holders (including, inter alia, Qualcomm) avoid the October 2021 FRAND/antitrust trial in the Northern District of California altogether. Nokia currently has the upper hand in Germany over both Daimler and one of its key suppliers of telematics control units, Continental, and may get decisive leverage from patent injunctions–probably in Munich before it does anywhere else–long before the end of the two long years, plus two months, that the build-up to the trial in the Northern District of California is still going to take.

   [...]

   The panel of three judges will announce a decision at noon (Central European Summer Time) tomorrow. As I’ll explain further below, the court hasn’t changed its mind about the appropriateness of the existing anti-antisuit-injunction injunction (“AAII”) against CAS, but the fate of Nokia’ severed pursuit of the same kind of AAII against Continental AG now turns on the question of whether the group parent, though it would undoubtedly be considered a real party in interest by U.S. standards, can actually be enjoined with respect to a motion brought by an indirect (like six degrees removed) subsidiary.

2. Continental seeks to keep Avanci case in San Jose, says it “will have immediate and lasting effects on the whole IoT industry [...] around the world”

   In a few hours the Munich I Regional Court will finally hear oral argument regarding Nokia’s motion for an anti-antisuit-injunction injunction (“AAII”) against automotive industry supplier Continental. In the post I just linked to, I stated the correct weekday (Thursday) but missed the correct date by one day (meanwhile fixed).

   In the antisuit context, I’ve previously expressed some disappointment that Continental didn’t make it structurally easier for Judge Koh (such as by choosing the ideal plaintiffs and movants from that large corporate group) to grant the U.S. antisuit motion. The motion and the related reply brief made some valid points, but also contained nonsensical parts. And, quite frankly, I don’t understand why they didn’t counter Nokia’s denial of functional identity of the parties by pointing to Nokia’s own argument in the German AAII case, where Nokia essentially tells the court that Continental AG, the Germany-based group parent, controls all Continental entities at any rate–in which case functional identity (between the parties in Continental v. Avanci et al. in San Jose and the German Nokia v. Daimler–as well as recently-filed Sharp v. Daimler–cases) becomes a matter of merely applying the logic of the U.S. customer suit exception here.

   But I must give Continental’s U.S. lawyers credit for now having filed the strongest and most thoroughly researched opposition brief to a venue transfer motion that I’ve seen in almost a decade of watching these kinds of cases. It’s roughly three times as fact-rich as the average opposition brief of this kind that I’ve seen in high-profile cases. While Continental’s filings in the antisuit context contain passages that attempt to substitute words for facts, the opposition brief to Avanci’s motion to transfer the case out of Judge Lucy H. Koh’s court in San Jose (Northern District of California) and to the Northern District of Texas excels with a record density of relevant facts…

3. Nokia wins again: Munich court issues additional anti-antisuit injunction against Continental’s German parent company to stop pursuit of U.S. antisuit injunction

   Yesterday I attended and reported in detail on the Munich I Regional Court’s preliminary-injunction hearing in Nokia v. Continental AG. Last month Nokia had already obtained an against Continental Automotive Systems, Inc. (“CAS”; not to be confused for the international sports tribunal) of Auburn Hills, MI, the plaintiff in the Northern District of California FRAND/antitrust lawsuit against the Avanci patent pool firm, whose contributors include Nokia, Continental, and various other patent holders. Today the court doubled down on Continental by additionally granting Nokia an AAII against Continental AG, the Hanover, Germany-based parent company of the entire Continental group.

   This is a very significant victory for Nokia’s litigation team, particularly its European head of litigation, Dr. Clemens-August Heusch, and the Finnish mobile company’s outside counsel from the Arnold & Ruess firm: lead counsel Dr. Cordula Schumacher; Dr. Arno Risse (“Riße” in German), the mastermind behind the AAII initiative; and Tim Smentkowski.

   Today’s AAII, which Judge Dr. Hubertus Schacht announced in his chambers (with only one other person than me listening), requires the German parent company to use its influence over its indirect U.S. subsidiary in order to cause it to comply with the AAII already in place against CAS. This means Continental AG must tell a direct subsidiary to tell an indirect subsidiary to tell another indirect subsidiary–and so forth–until at the end of that enforcement chain CAS is directed to withdraw the fully-briefed U.S. motion for an antisuit injunction.

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