2023 Issue 1
Unified Patent Court and Unitary Patent System Commence on 1st June 2023
After decades of negotiations amongst European Patent Convention (EPC) members the ability to be granted a single patent covering many (but not all) EPC contracting states which can be enforced in those states through one set of judicial proceedings will commence on 1st June 2023.
Currently there is no European patent right, rather the EPC is only a procedural mechanism whereby applicants can make a single patent application which can progress through the examination stage up until the decision to grant is notified. At that stage the applicant has to decide which of the EPC contracting states (and validation and extension states) they want to validate the grant in. After the 9-month opposition period before the EPO, this results in a bundle of granted patents, each of which needs to be individually enforced (or attacked) within the national courts of the state it is validated in.
Eligibility for Supplementary System
The Unified Patent Court (UPC) and Unitary Patent (UP) legislation were introduced to supplement the EPC in order to remedy some of the drawbacks of the current EPC system. However, in order to allow for European patent rights the UPC and UP are both legislation of the European Union (EU), whereas the EPC is a piece of international law not subject to the law of the EU. Consequently, only EU member states can join the UPC and UP system. While all 27 EU member states are members of the EPC, there are a further 12 EPC members are not EU members. So far 17 EU member states have acceded to and ratified both the UPC and the UP legislation. These participating states are: Germany, France, Italy, Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, and Sweden. A further 7 EU member states have acceded to both the UPC and UP legislation, but have only ratified the UP. These states will remain ineligible for the supplementary system until they ratify the UPC legislation, which the UP legislation depends upon. These currently non-participating EU states are: Cyprus, Czech Republic, Greece, Hungary, Ireland, Romania and Slovakia. The remaining 3 EU states of Croatia, Poland and Spain have not acceded to the UPC and UP system and so are also currently ineligible to participate. The remaining 12 EPC member states are not in the EU, with notable countries in this group being the United Kingdom, Turkey, Switzerland and Norway.
Decision Time for Patentees of EPs Validated in Participating States before 1st June 2023
National patents obtained via the EPC before 1st June 2023 that were validated in one of the 17 participating states will by default be subject to the jurisdiction of the UPC unless the patentee opts out in time. Opt-outs lodged with the EPO before 1st June 2023 will be in time. If an opt-out is lodged with the EPO during the transitional period of 7-years on or after 1st June 2023 it will only be in time if no action has been commenced before the UPC. Where a patentee has opted out before or during that 7 year period they can also opt back in provided no action has been brought before a national court of a UPC Agreement member state. National patents obtained via the EPC before 1st June 2023 that were validated in the other EU and non-EU EPC member states will continue to be subject to the jurisdiction of the national court, apart from those that are still within the 9-month post-grant opposition period before the EPO (and appeals therefrom).
Decision Time for EP Applicants with Applications Pending before 1st June 2023
If an EP applicant that is unlikely to be issued with a decision to grant before 1st June 2023 and the applicant ultimately wants to obtain patent protection in some or all of the participating states, they need to decide whether they want to be subject to the jurisdiction of the UPC for those participating states. If they currently do not, then the safest option is to opt-out before 1st June 2023. If they subsequently change their mind there will be an option to opt back in when the EP is granted. They can also opt back in during the 7 year transitional period provided no action has been brought before a national court of a UPC Agreement member state.
Decision Time for EPC Applicants with Applications Pending on or after 1st June 2023
From 1st June 2023 there will be two options for EPC patent applicants whose application thenceforth gets issued with a decision to grant as follows:
(i) They can choose to have a UP covering the above noted 17 EU member states. If this option is chosen the UP will be subject to the jurisdiction of the UPC and cannot be opted back out. Validation of grant can continue to be made individually in the other EU and non-EU EPC member states. These will only be subject to central attack during the 9-month post-grant opposition period before the EPO (and appeals therefrom), and thereafter only subject to the jurisdiction of the national court. A member state covered by a UP cannot also be validated before the national office. When currently non participating EU states subsequently ratify the UPC they will only be eligible for inclusion for UP’s that grant from the date they join;
(ii) They can choose to only validate grant individually in selected EPC member states, whether or not those states are participating in the UP system. Nonetheless, the UPC will be the default jurisdiction for such national patents in any of those EPC member states that are in the UPC. However, that default jurisdiction of the UPC can potentially be avoided in two ways for a transitional period of 7-years from 1st June 2023. (a) If the party bringing the infringement or revocation action commences that action before a national court; or (b) If the proprietor or patent applicant opts out provided no action has already been brought before the UPC. Where a patentee or patent applicant has opted out before or during that 7 year period they can also opt back in provided no action has been brought before a national court of a UPC Agreement member state. As with option (i) validations in the other EU and non-EU EPC member states will only be subject to central attack during the 9-month post-grant opposition period and thereafter only subject to the jurisdiction of the national court.
Unitary Patent: What are the Advantages and Disadvantages?
- Given the savings in validation, translation, renewal and recordal costs UPs are likely to be more cost effective if patent protection is sought in 4 or more participating states;
- If a UP is unlikely to be renewed up to its full term, then renewal fee savings will be less significant;
- If a UP is granted before a new member state accedes to the UPC Agreement, the UP will not extend to that new member state;
- Once opted in for a UP cannot be opted back out of;
- UPs have unitary effect in applicable jurisdictions and are only enforceable and revocable as a single patent;
- UPs cannot be partially assigned, but they can be partially licenced;
- It is envisaged that translation from one of the EPC official languages will not be required for non-litigated patents. However, until machine translation significantly improves UPs granted in German or French must be translated into English and all UPs granted in English must be translated into German or French;
- Nullity actions for a UP can be commenced by anyone irrespective of whether they are affected by the UP.
Unified Patent Court: What are the Advantages and Disadvantages?
- Injunction, Infringement and/or revocation proceedings can be determined by a single proceeding for participating states, giving cost and time savings for all involved;
- Proceedings before the UPC will avoid the possibility of diverging decisions regarding the same patent by national courts of different participating states;
- Proceedings before a central division will be in the language the UP was granted in, while local or regional divisions use an official language of the hosting state unless discretion allows the language of grant to be used;
- If an existing bundle of national rights validated from an EP are in the names of different proprietors, then all of those proprietors would have to opt out of the UPC in order for an opt out application to be effective;
- The Unified Patent Court’s jurisdiction in respect of a given unitary patent will only extend to states that were members of the Unified Patent Court Agreement on the effective filing date of that patent.
Understanding the Concept of an Inventor
The concept of an inventor needs redefining to specifically include artificial intelligence.
The rapid advancement of artificial intelligence (AI) has revolutionized the way we create and innovate. AI systems can now autonomously devise new solutions, designs, and concepts that were once exclusively within the realm of human creativity. With AI playing an increasingly prominent role in the innovation process, it is time to reconsider the traditional definition of an inventor and acknowledge the capabilities of AI as the actual deviser of inventions.
Current Definition of an Inventor
Patent laws in most jurisdictions, including New Zealand, have historically required that inventors be human. Though this often relies on conservative and backward looking reasoning – that “humans have always been inventors” or that the regulations have not been updated and require the nationality of the inventor to be identified. This stems from the outmoded belief that only humans possess the creative and intellectual capacity to generate novel ideas and inventions.
Today, AI systems have proven this assumption to be outdated. Artificial intelligence can now autonomously generate inventions without direct human intervention, calling into question the adequacy of the current definition of an inventor.
Advancements in AI, such as machine learning and neural networks, have allowed these systems to independently generate ideas and solutions. These AI-driven innovations often stem from vast data sets and complex algorithms that enable the AI to identify patterns and relationships that humans may overlook. As such, AI systems can now create novel and inventive solutions without direct human input.
The current definition of an inventor in most jurisdictions is based on the premise that only humans can provide the intellectual contribution necessary for an invention. The New Zealand definition is more universal in its approach requiring the inventor to be the “actual deviser” (without mentioning that the inventor must be a human). S.6 NZ Patents Act 2013.
Australia on the other hand omitted a definition of an “inventor” from its statute, preferring instead to rely on backwards looking dictionaries. Anyone who saw the movie “Hidden Figures” in 2016 will appreciate that words like “computer” change from being a solely human occupation to now describing machines which have replaced those “human calculators” (the latter also being an early human occupation but no longer the preserve of humans).
However, AI systems have demonstrated their capacity to generate ideas and solutions that are both novel and non-obvious, fulfilling the key criteria for patentability. By adapting and learning from data, AI systems can generate new insights and apply them to develop inventive solutions, thereby making a significant intellectual contribution.
AI systems do not function in a vacuum; they are designed, trained, and maintained by human experts. Nonetheless, the role of humans in the innovation process is evolving. Instead of being the sole originators of inventive ideas, humans increasingly collaborate with AI systems to enhance and optimize the creative process.
Recognizing AI as an inventor not only reflects this new reality but also incentivizes further human-AI collaboration in the pursuit of ground-breaking innovations.
Given the growing capabilities of AI systems, it is crucial to revise the traditional definition of an inventor to include AI as the actual deviser of inventions. This change would not only acknowledge the creative potential of AI systems but also encourage further investment in AI research and development.
Moreover, a more inclusive definition of an inventor would provide legal clarity and ensure that AI-generated inventions are adequately protected by intellectual property rights.
The time has come to redefine the concept of an inventor to include artificial intelligence. As AI systems increasingly demonstrate their ability to autonomously generate novel and inventive solutions, it is essential to recognize their role in the innovation process. By updating patent laws to reflect the evolving landscape of innovation, we can foster an environment that embraces and promotes the full potential of human-AI collaboration.
Why Identifying the Invention Matters More Than Identifying the Inventor
The underlying purposes of patent law are best served when the invention has precedence over the inventor.
The primary goal of patent law is to protect and incentivize innovation by granting inventors exclusive rights to their creations for a specific period. While the identification of the inventor is essential in assigning these rights, the emphasis of patent law is placed on the invention itself. This article will explore why the identification of the invention takes precedence over the identification of the inventor in the realm of patent law.
The Importance of the Invention
1. Assessing Novelty and Non-obviousness
A critical aspect of patent law is determining whether an invention meets the criteria for patentability. An invention must be novel, non-obvious, and useful to be eligible for patent protection. By focusing on the invention, patent law ensures that only truly innovative ideas are granted protection, fostering a competitive environment that rewards creativity and drives technological advancement. In the NZ patents Act 2013 the word “invention” occurs 289 times compared to the measly 32 occurrences of the word “inventor”.
2. Defining the Scope of Protection
The identification of the invention is essential in delineating the scope of protection granted by a patent. A well-defined invention allows the patent office, competitors, and other stakeholders to understand the precise boundaries of the exclusive rights granted to the patent holder. This clarity is crucial in preventing infringement disputes and fostering a transparent and fair competitive landscape.
3. Encouraging Disclosure of Information
Patent law aims to strike a balance between rewarding inventors and promoting the dissemination of knowledge. By granting inventors exclusive rights to their inventions, patent law incentivizes them to publicly disclose the details of their creations. This disclosure allows others to learn from, build upon, and improve existing technologies. Focusing on the invention ensures that the knowledge it embodies is shared and contributes to society's collective intellectual wealth.
The Role of the Inventor
While the identification of the inventor is essential in assigning patent rights, it is ultimately secondary to the identification of the invention itself. The inventor's role in patent law is primarily to:
A. Establish Ownership
Identifying the inventor (whether human or not) is crucial in determining who holds the exclusive rights to the invention. Today patent statutes have shifted from granting the patent only to a human inventor to a focus on the “(Legal) Person entitled to Grant” as most patents are granted to corporate entities not individuals. Properly attributing ownership ensures that the right inventors or entities are rewarded for their creative efforts, encouraging further innovation.
B. Resolve Disputes
In cases where multiple parties claim to have independently devised the same invention, the identification of the inventor can help resolve potential disputes. However, it is still the invention itself, rather than the identity of the inventor, that forms the crux of these disputes.
The focus of patent law on the invention, rather than the inventor, reflects the primary objective of fostering innovation and promoting the dissemination of knowledge. By emphasizing the identification of the invention, patent law ensures that only truly novel and inventive ideas receive protection, while also providing a clear scope of protection and encouraging the disclosure of valuable information. While the identification of the inventor remains important for assigning patent rights and resolving disputes, it is the invention itself that serves as the cornerstone of the patent system.
2. Trade Marks
BOTOX Reputation Unable to Provide Smooth Result for Allergan’s Infringement Allegation
In Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd  HCA 8 the High Court has unanimously allowed Self-Care’s appeal, holding that Allergan’s BOTOX mark has not been infringed either by Self-Care’s use of the phrase "instant Botox® alternative" or by its mark PROTOX.
Self-Care uses the phrase "instant Botox® alternative" and its mark PROTOX in relation to anti-ageing serum and anti-wrinkle serum, which are goods that fall within class 3 on the Nice Classification. Allergan’s primary registration and use of its BOTOX mark is in relation to the following class 5 goods: pharmaceutical preparations for the treatment of neurological disorders, muscle dystonias, smooth muscle disorders, autonomic nerve disorders, headaches, wrinkles, hyperhydrosis, sports injuries, cerebral palsy, spasms, tremors and pain.
However, in 2015 the BOTOX mark was registered by Allergan as a defensive mark in relation to numerous other goods and services, including many class 3 goods. Australia allows the owner of a mark that is used and registered in relation to particular goods and services to also register that mark as a defensive mark in relation to other goods and services if use of the mark in relation to those other goods or services would likely be taken as indicating a connection with the owner of the mark that is registered and used. Such defensive marks do not need to be used in order to be maintained. New Zealand dropped defensive marks when its Trade Marks Act 2002 commenced, with existing defensive marks expiring by way of being denied renewal.
The High Court found that the primary judge was correct to find that the phrase “instant Botox® alternative” was not used by Self Care as a trade mark, and that the Full Court was wrong to overturn that finding. The presentation of that phrase and its proximity to source identifiers along with its descriptiveness in relation to the products it was used on counted against it having trade mark significance.
The primary judge found PROTOX to not be deceptively similar to BOTOX as the marks were sufficiently distinctive to the extent that relevant notional consumers were not likely to confuse them. While the words have visual and phonetic similarities, there was found to be little by way of conceptual similarity. The primary judge rejected the contention that there was likely to be imperfect recollection of the BOTOX mark, finding that the high degree of reputation in the mark would count against that.
The Full Court allowed Allergan’s appeal. While it agreed that the two marks would not be confused, the Full Court nonetheless found infringement on the basis that relevant consumers could be confused as to whether the two marks are used by the same undertaking on different goods. Notably, at  the Full Court said:
Some consumers are likely ... to have wondered whether PROTOX was an alternative product being offered by those behind BOTOX, perhaps targeted to those who did not like injections or who wanted the convenience of a home treatment. Some consumers are likely to have wondered whether PROTOX was developed by those behind BOTOX as a topical treatment to be used in conjunction with Botox treatment, perhaps to improve or prolong results.
The High Court readily found the Full Court fell into error. Not only did it fail to apply the correct test of comparison based upon the notional use of BOTOX on its registered goods, rather than its actual goods, the reputation of BOTOX is also implicit to the Full Court’s reasoning. The High Court held that reputation should not be taken into account when assessing deceptive similarity under section 120(1). That conclusion is compelled by the structure and purpose of, and the fundamental principles underpinning, the TM Act. As only a registered mark can be infringed, alleged infringing conduct can only be assessed in relation to the monopoly conferred by registration. The degree of deceptive similarity between a registered mark and an allegedly infringing mark for section 120(1) purposes does not depend upon the reputation of the registered mark. If reputation can be relevant to infringement, then it would need to be recorded on the Register as the Register is the complete record of the monopoly. Neither the reputation of the mark nor the trade mark owner's reputation is a particular on the Register. Were reputation relevant to establishing infringement it would collapse the long-standing distinction between trade mark infringement and passing off.
While the High Court’s decision was principally in response to the Full Court’s decision, its reasoning also applies against the trial judge’s use of BOTOX’s reputation to find that imperfect recollection was not an issue. Making its own assessment the High Court found there was no real tangible danger of deception or confusion occurring. While there were similarities that might imply an association to a notional buyer, such a notional buyer would also be aware that one trader’s product can be used to enhance another trader’s product. Self-Care’s product and its website contained statements that would allow a reasonable consumer to realise they are not purchasing a product made by the owner of the BOTOX brand.