March 2016

1. General

New Zealand

Submissions on TPP's IP Provisions Sought
Public submissions are requested by 30th March 2016 on the proposed implementation of the TPP’s IP provisions.

Up until the end of 1994 the Patents Act allowed for extension of term. However, they were repealed when NZ moved from a 16-year to a 20-year patent term as part of its TRIPs compliance from the beginning of 1995. The TPPA will reintroduce extension of term provisions, albeit with changes to qualifying criteria. Under the TPPA patent extension of term need to be provided for delays in patent grant and delays due to obtaining regulatory approval for pharmaceuticals. In both cases, for New Zealand, it is expected that few extensions of term will be granted.

For delays in patent grant it is proposed that the extension of term will be calculated as follows and that no third party opposition to the granting of an extension of term would be allowed. The extension would be the smaller of:

• the period by which the interval between the filing date of the complete specification and the grant of the patent exceeds five years (less any periods that were disregarded) and
• the period by which the interval between the filing date of the request for examination and the grant of the patent exceeds three years (less any periods that were disregarded).

For delays due to obtaining regulatory approval for pharmaceuticals there are more issues to consider. The most important issues being:

• how “unreasonable curtailment” should be defined
• how the length of any extensions should be calculated
• what patented subject matter should be eligible for extension – patents for pharmaceutical products or for pharmaceutical substances
• what conditions and limitations should be imposed.

It is proposed that “unreasonable curtailment” would apply where marketing approval was obtained after grant and where the marketing approval took more than a (yet to be) specified time period (less any periods that were disregarded).  The time period for biologics would be longer than for small molecule pharmaceuticals. It is proposed that the extension of term will be the lesser of:

• the period by which the interval specified in the second bullet point above exceeds the specified number of years for small molecule pharmaceuticals or the specified number of years for biologics
• the period between the date of grant of the patent and the date on which marketing approval was granted
• a period of 2 years.

It is proposed that extensions of term will be limited to pharmaceutical substances so that at most only one patent can be extended for a pharmaceutical substance. Pharmaceutical products containing that pharmaceutical substance would not be eligible. It is proposed that the extension of term would need to be applied for within a (yet to be) specified time period and that at most only one extension of term could be granted for a patent and that only the specified use of the substance would be protected. Third party opposition would apply, in the first instance before the Commissioner.

Other issues for consideration include:

• Civil and criminal prohibitions against circumvention of technological protection measures.
• Performers’ rights.
• Customs power to detain suspected infringing goods.

2. Patents

Australia

Best Method Requirement Clarified
In Les Laboratoires Servier v Apotex Pty Ltd the Full Court of the Federal Court clarified the requirements for a finding of lack of best method and held that Servier’s patent was invalid for lack of best method. In its decision the Full Court ruled on appeals from the trial Judge’s decisions, including the decision finding lack of best method and the decision denying Servier’s amendment application.

The initial point for the Full Court to consider was whether section 40(2)(a) requires best method to be satisfied when sufficiency of disclosure is satisfied. Section 40(2)(a) states that the complete specification must:

(a) describe the invention fully, including the best method known to the applicant of performing the invention.

Precedential case law held that for compliance with section 40(2)(a) the specification need only enable one embodiment within each claim and that there is no requirement to make reference to any method if common general knowledge enables the skilled worker to make something within the claim. Servier sought to use that case law and the word ‘including’ in section 40(2)(a) to argue that the best method requirement is only a subset of the sufficiency requirement.

However, the Full Court rejected that holding that the best method requirement is separate to the sufficiency requirement. The Full Court noted that the best method requirement applies to complete specifications while the obligation to describe the invention applies to both provisional and complete specifications – although to different degrees. The Full Court also held that the precedential case law only addressed the sufficiency requirement and so the test therein would be applied out of context if applied to the best method requirement. It was also noted that best method was judicially developed as a requirement even before being specified in legislation, having the purpose of preventing a grant on false suggestion or representation and providing the public with the full benefit of the invention when the patent expires.

The Full Court also addressed the issue of the date by which the specification must disclose the best method known to the patentee. It was noted that previous case law had given differing interpretations, ranging from the date of filing the complete specification to the date of grant. The Full Court held that the date of filing of the complete specification is the relevant date for establishing best method, but left open the possibility of amendment thereto.
Servier next submitted that best method is not relevant to a per se product claim and in any event would be satisfied by the identification of the claimed compound. Claim 1 claimed the arginine salt of perindopril and its hydrates. The specification only states that the arginine salt is prepared according to a classical method of salification of organic chemistry. The Full Court accepted that in principle there is no requirement to disclose a method of using a claimed product. Nonetheless, the specification still has to disclose what the invention is. In this case the invention is directed towards a compound, the utility of which is improved stability and storage capacity when produced by the best method. The Full Court held that when read in the context of the specification as a whole it is clear that the patentability of claim 1 is dependant upon the advantages of improved stability and storage capacity. Consequently, it held that in such circumstances there is an obligation on the Patentee to provide the best method for producing a form of the claimed substance that best fulfils the promises of the invention.

Following the trial Judge’s decision finding lack of best method Servier sought to amend the specification with the leave of the Court to add methods of making perindopril arginine to the specification. The trial Judge accepted that in principle such amendment is possible after the filing date of the specification and even after grant and held that to hold otherwise would unduly restrict the availability of amendment in revocation proceedings. However, the trial Judge exercised discretion in disallowing the amendment on account of Servier’s decision not to heed the 2004 recommendation of their patent attorney to add a method of manufacture. In particular, the damage to the public interest was not reasonable and outweighed Servier’s proprietorial interest in saving the patent from revocation.

The Full Court held that Servier’s appeal did not establish any relevant error by the trial Judge in exercising his discretion to disallow amendment and so upheld the trial Judge’s ruling thereon. Servier has subsequently obtained a stay application preventing market entry by Apotex pending Servier’s application for special leave to appeal to the High Court.

United States of America

Patent Exhaustion in USA Clarified
In Lexmark International Inc v Impression Products Inc the Court of Appeal for the Federal Circuit (CAFC) reaffirmed the contractual and foreign sale exceptions to patent exhaustion despite arguments being made that the exceptions conflict with a recent Supreme Court precedential judgement.

Lexmark’s sales of its patented printer toner cartridges are generally subject to an express single use and no resale condition. Lexmark sued Impression for patent infringement after Impression obtained the used cartridges and refilled and then resold them in the United States. Impression claimed that Lexmark’s patent rights had been exhausted.

In a majority decision the CAFC found for Lexmark, holding that Impression’s conduct fell within the exceptions to the patent exhaustion doctrine in line with the CAFC’s own precedents. In particular, exceptions to patent exhaustion apply where either a US seller places contractual conditions on sale (such as Lexmark did) or where foreign sales still preclude resale into the US. Provided the single-use or no-resale restriction is lawful and clearly communicated to the purchaser, the sale does not give the buyer, or downstream buyers, the resale or reuse authority that has been expressly denied.

In reaffirming that position the CAFC held that a precedential Supreme Court copyright exhaustion case is not relevant to consideration of patent exhaustion. The Supreme Court copyright case Kirtsaeng v John Wiley & Sons Inc held that 17 USC §109(a) entitles owners of copyrighted articles to take certain acts “without the authority” of the copyright holder. However, the CAFC held that there is no counterpart to that provision in the Patent Act, under which a foreign sale is properly treated as neither conclusively nor even presumptively exhausting the US patentee’s rights in the United States.

CAFC Clarifies When Proof of Public Availability of Internet Disclosures Required
In Blue Calypso LLC v Groupon Inc the CAFC found that a document linked to the internet was not publically available before the critical date.

Groupon asserted that an anticipatory document was available via a hyperlink located on a personal webpage created by a graduate student before the critical date of Blue Calypso’s patents and was therefore a printed publication under § 102(b). In considering the public availability of documents on the internet the CAFC noted three main options for making the assessment. Namely;

• (i) evidence that the reference was actively distributed to the public or actually retrieved by members of the public,
• (ii) evidence that the prior art was indexed, and
• (iii) the presence of a research aid. In this case there was no evidence that the reference was actively distributed to the public or actually retrieved by members of the public.

Given that internet search engines do not index documents as soon as they are connected to the internet, there can be some time before such a document becomes indexed such that it could be expected to be retrieved by a relevant search. The CAFC held that, particularly in cases of documents or webpages that are not well-known to the community interested in the subject matter, evidence is required to show that a query of a search engine before the critical date would have led to the reference appearing in the search results. In the absence of such evidence the CAFC held that the relevant document did not qualify as a printed publication under § 102(b).

The CAFC also considered the relevance of research aids such as citations to evidence of public availability. In this case Groupon alleged that another document co-authored by the graduate student would have acted as a research aid that would lead interested parties to the anticipatory document. However, the CAFC held that the co-authored published article did not provide a skilled artisan with a sufficiently definite roadmap leading to the anticipatory document. An adequate roadmap need not give turn-by-turn directions, but should at least provide enough details from which it can be determined that an interested party is reasonably certain to arrive at the destination.

3. Designs

United Kingdom

Supreme Court Agrees with Narrow Protection for Innovative Design
In PMS International Group PLC v Magmatic Ltd the Supreme Court upheld the Court of Appeal’s finding that PMS’s “Kiddee Case” did not infringe one of Magmatic’s Community Registered Designs (CRD) for a ride-on suitcase suitable for children.

PMS’s “Kiddee Case” and the CRD had similar features such as being designed to look like an animal, having 4 similarly placed wheels, a clasp at the front and a saddle shaped top suitable for being ridden on. However, PMS’s “Kiddee Case” differed in being brightly coloured, having eyes, containing arrangements of decorative features and covered wheels. Other features such as two protuberances at the front and the lengthways ridge were considered to have both similarities and differences.

Magmatic alleged that the “Kiddee Case” did not produce on the informed user a different overall impression than the CRD, while PMS countered with a squeeze argument that if that was the case then the CRD would be invalid on account of Magmatic’s earlier “Rodeo” version of a ride-on suitcase. Magmatic succeeded in their infringement action before the trial Judge.

However, the Court of Appeal reversed. They found no infringement on the basis that the trial Judge had focussed too much on individual features and neglected to consider the overall impression. They also held that the absence of decorative features in and the two tone colouring of the CRD added to the difference in overall impression. The Supreme Court agreed with the Court of Appeal’s finding of no infringement and indicated that while Magmatic had created an innovative design that the protections available thereto are not as wide as apply to an invention under patent law.

4. Trade Marks

New Zealand

Major Events Management Act Updated
From the 1st April 2016 the Major Events Management (Olympic Games and Commonwealth Games Emblems and Words) Order 2016 amends the schedule of the Major Events Management Act 2007. The Order completely replaces Parts 1 and 3 of the schedule, which specify protected emblems and words relating to the Olympic and Commonwealth Games. The Order also adds ‘Comité International Olympique’ to the list of permanently protected names given in Part 2 of the schedule.

Public Submissions Sought on Geographical Indications Bill
On the 3rd November 2015 the Geographical Indications (Wine and Spirits) Registration Amendment Bill 2015 was introduced to Parliament and the main changes that the Bill introduced were reported in the November 2015 bulletin. On the 17th March 2016 the Bill passed its first reading and has been referred to the Primary Production select committee. Public submissions on the Bill are now being sought with the closing date for submissions being 29th April 2016.

Trade Mark Practice Guidelines Updated
IPONZ has updated its trade mark practice guidelines for amendments to trade mark applications and for agents.

The practice guidelines now specify that applications for amendment to a trade mark or for broadening of the goods or services or any other broadening amendment that is filed on the applications filing date will result in the filing date being amended to the date that the amendment is processed. Consequently, where such amendments are requested on the filing date, it is advised that the applicant should additionally make IPONZ aware of the amendment to allow for its immediate processing.

The practice guidelines for agents now specify that where an agent applies to merge two or more trade marks they first need to be recorded as the agent in respect of all of the trade marks in the merger request.