#15018 - Patent Registration And Subject Matter - Intellectual Property Law

Development

1624 Statute of Monopolies

• Allowed monopoly rights over “manner of new manufactures” for 14 years

• Codification of past practice in allowing for monopolies

Patents, Designs and Trade Marks Act 1883

• Gave effect to Paris Convention 1883

Patents Act 1977

• After much piecemeal reform, this Act implemented the European Patent Convention 1973

Patent is a time-limited (usually 20 years) exclusive right to restrict the trade and use of ideas and information, incorporated in a qualifying product or process

• Initially lasts for 4 years but can be extended up to 20

• Can be enforced against ALL who use the invention

  • Much stronger than copyright: works against independent creators and not just copiers

• UK national patent can be granted by UK IPO on application

• Based on the criteria in PA 1977

  • PA 1977 s130(7): Certain provisions are framed “as to have, as nearly as practicable, the same effects in the United Kingdom as the corresponding provisions of the European Patent Convention”

  • Lord Neuberger in HGS v Eli Lilly (2011): Both the EPO and national courts are applying the same principles from the EPC

    • If the EPO decides that a patent is invalid: “that is the end of the issue”

    • If the EPO decides that a patent is valid, the national court can still hold it invalid within its jurisdiction

    • The conclusions of the EPO and national courts need not be the same because of different evidence or arguments or evaluations

    • EPO decisions are not effectively binding on national courts, but should be applied where consistent

• Appeals go to the Commissioner for Patents then the Courts

• EPO can grant a bundle of national patents

  • Based on the criteria under the EPC 1973

    • The Convention is an intergovernmental treaty, NOT part of the EC/EU

    • Centralised opposition proceedings can be brought for 9 months

    • EPC was revised in 2000

  • Appeals go to the relevant Board of Appeal

  • National courts can revoke the national patent granted

• NOTE: There is NO community patent yet (unlike with trade marks)

  • Community Patent Convention was signed in 1975 but never came into force

  • Using the enhanced cooperation procedure, 2 regulations were adopted in 2012

    • Creating a European patent with unitary effect

    • Establishing a language regime applicable to the unitary patent

  • There was also an international agreement in 2013 regarding the setting up of a Unified Patent Court

    • Not yet ratified (and not signed by Spain and Italy)

  • ISSUES

    • Unclear how this relates to the CJEU

    • 3 official languages so there is still translation cost

      • Still need to translate further in infringement proeedings

    • Results in 3 systems: national patents, bundle of patents (European patents), unitary patent (for signatories)

    • Davies/Aplin: The system is not “coherent and efficient”

• Supplementary Protection Certification Regulation (SPC Regulation 1992)

  • Allows for patented medicinal products which have regulatory approval to be protected for a maximum of 5 years after the 20 year patent expires

  • Used where marketing has been delayed by the need to obtain regulatory approval

• Biotechnology Directive

  • Very controversial directive, finally adopted in 1998

  • Netherlands brought annulment action but this was rejected in 2001

  • Implemented in 21 Member States by 2005

  • Harmonises the rules on patents for biotechnological inventions

    • E.g. requirements and exclusions

    • Compulsory licensing procedures

Natural rights

• Lockean view: a person should own what is produced by his own labour

  • Provided that there is enough that is good left for others (equality), and that one does not take more than one can use (no wastage)

• ISSUE (Chevalier): An idea can belong to an unlimited number of persons

  • Unlike literary or artistic works which have “decided character of individuality”, inventions can be made by multiple people without taking it away from the inventor

• ISSUE (Macfie): Any natural right would be the right to use one’s own invention

  • But patents might actually prevent this since someone else could obtain a patent on something which one invents

• ISSUES (Liddell)

  • Lacks explanatory power

    • Patent law doesn’t recognise the efforts of all labourers, but only that of the first inventor (even if a 2^nd inventor spends effort developing independently)

    • Patent law only recognises inventive labour

    • Patent law doesn’t prevent wastage since there is no revocation for non-use

    • Does not leave enough for others if basic ideas can be totally monopolised

  • Lacks normative power

    • Unclear why it labour should naturally give rise to property

    • Unclear how conflicting rights can be balanced (e.g. right to property vs right to health)

• NOTE: Many international conventions place IP within the right to property

Just reward for inventors

• Based on the moral rights of inventors to receive reward for their labour

• ISSUE (Machlup and Penrose): Even if this isn’t denied, that doesn’t mean that the reward has to come in the form of a patent

  • The time interval between his use of the invention and imitation by competitors might accrue enough financial reward?

  • Cash prizes or bonuses might be paid out instead of creating monopolies that prevent others from building on the inventions

    • BUT a bonus system might be susceptible to corruption and arbitrariness due to the exercise of discretion involved

Utilitarianism

• Based on the assumptions that industrial progress or inventive activity is desirable and that the patent system is capable of incentivising such activity

• Incentive to create or invest in R&D

  • The argument is that there is high cost in creation but ease of copying, so there must be an incentive to create rather than copy

• Incentive to develop or commercialise the invention

  • Huge amounts of investment are required to transform he initial idea into a marketable product which would benefit consumers

  • The assumption is that inventors wouldn’t want to make this investment if they couldn’t be sure of recouping profits at the end (rather than competitors benefitting from it instead)

• ISSUE: The patent system is actually very expensive

  • Social cost of diverting inventive activity into more lucrative fields

  • Bureaucratic and administrative cost

  • Economic disadvantages from having a monopoly

  • Social cost in preventing other producers from building on the invention

  • Litigation and registration cost

  • Transaction costs

• ISSUE (Johnson): There is insufficient empirical evidence of the effectiveness of patents

  • People have an intrinsic desire to create and would do so even without patents

  • Pharmaceutical study by Mansfield (1986) suggests that 35% of pharmaceutical inventions would be released without patent protection

  • Open source software is well-developed despite the lack of patents

    • BUT this might be the exception rather than the rule

• ISSUE (Lerner): Where patent protection has been strengthened by policy changes, that hasn’t resulted in a corresponding increase in patent registration

  • Suggests that a stronger patent system doesn’t really incentivise invention

• ISSUE (Nathan): Patent law sets the wrong kind of targets and isn’t socially desirable

  • Especially in fields such as medicine, it incentivises profitable inventions rather than socially beneficial ones (since only the wealthy can pay for it)

  • Between 1975-1997, only 1% of new chemicals patented were aimed at combating tropical diseases rather than diseases in the richer, wealthier West

  • Suggests that governments should pay drug makers based on the disease benefit of their drug inventions

  • NOTE: The views opposing patents aren’t consistent on whether they think the system actually incentivises producers in a certain way

• ISSUE (Machlup and Penrose): The actual inventors may not be the holders of the patent

  • They may produce the invention in the course of employment or be forced to sell the patent right off at a low cost

  • Might be better to consider patents an incentive of capital and investment into development of inventions

• Incentive to disclose information

  • Argument: without patents, the initial inventor is more likely to keep the invention a secret rather than allowing it to benefit society

    • Seen as a quid pro quo: giving the inventor a temporary monopoly in exchange for his disclosure of the invention

  • ISSUES (Machlup and Penrose)

    • Even if inventors keep their ideas secret, the same might be developed independently elsewhere

    • These secrets would be found out by competitors

    • If the inventor was sure of his ability to keep the secret, he would also refrain from applying for a patent anyway

  • ISSUE (Fromer): Disclosure from patents doesn’t help with cumulative innovation

    • Evidence suggests that very few scientists actually read patent registers or cite patents in their research

Long: Patents work as signalling or co-ordinating devices

• Can be used to inform others that the company is operating in a specific field

Merges: Mid-level justificatory theory

• Draws on Rawls’ theory that it is easier to find mid-level principles that give overarching consensus rather than searching for underlying truth

• Suggests that neither utilitarianism nor natural rights theories can be proven

• Should look for mid-level principles

  • E.g. efficiency, preservation of public domain, proportionality, dignity

• ISSUE: These don’t really seem to be the guiding principles of IP law

ISSUE (Shiva): IP rights (including patents) are forced onto developing countries by developed countries, despite some of the justifications not being as applicable to them

• Knowledge is a “collective,...