27 May 2005

Merck Fails to "Evergreen"

On 6 October 2004, Gyles J. of the Federal court handed down Arrow v Merck 63 IPR 85. This case involved many issues. I focus on the lesson it gives in defining patentable subject matter.

The first hurdle in a patentability investigation is to establish what actually is patentable subject matter. In other words, the actual subject of the patent application must be a "manner of manufacture" as set out in the Patents Act and as defined and re-defined in many cases. Over the years, the courts have held that it is not possible to claim as an invention a new use for a known product where the known properties of the product would make it suitable for that use.

Merck was the holder of Australian patent No. 625704 for specific alendrate monosodium trihydrate species. The patent also covered a method of treating osteoporosis using this chemical. The patent was due to expire in 2010. In an attempt effectively to extend its protection (known as "evergreening"), Merck applied for and was granted Australian patent No. 741818. The second patent was directed primarily to a method of inhibiting bone resorption such as osteoporosis using the alendrate described in the first patent. The second patent also claimed a composition "adapted" for oral administration. The composition itself was already described in the first patent and the second patent attempted to cover the composition so adapted.

Arrow applied for revocation of the claims (and thus effectively of the patent) on a number of grounds including lack of subject matter of the claims.

In revoking the claims, Gyles, J. held that the method claimed was a direction to use a composition that was already known to be effective for that use. In other words, the "method" claims were simply a use of a known substance with known properties for a known purpose. Gyles J. also held that the "composition" claims were "devoid of practical content". He held that the composition as claimed was not a "new and unique" compound and did not "adapt" to once weekly dosing as compared to any other dosing.

22 May 2005

An excellent US patent blog.

For those of you interested in following developments in the US, an excellent blog is Dennis Crouch's Patently-O blog. It gets 20 000 hits a week! (I dream on...). I have a link to it in the side bar.

This is essentially an Australian blog. However, patent law in Australia and in the US is similar in many respects. The courts often cite US cases when wrestling with the complexities of our inventive step requirements. Furthermore, an effective IP strategy will often include the US.



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19 May 2005

CSIRO makes a stand

Australia's national research agency, CSIRO, made it known on 18 May that it will be defending its right to obtain reasonable royalties on its US patent related to WLAN. The patent (US 5,487,069) was granted to CSIRO in 1996. US patents are easily viewed on the US patent office website: www.uspto.gov.

Apparently, the technology is now a standard feature of most notebook computers and many other devices. According to Dr. Geoff Garrett, the CEO of CSIRO, the technology makes it possible to increase the speed of WLAN by a factor of five.

It appears that CSIRO will be butting heads with, amongst others, Microsoft, Dell, Hewlett-Packard, Intel, Apple and Netgear. I wish them the best of Aussie luck!

Keep an eye on this space for further developments.
My website: www.enb.com.au
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So who owns the invention anyway?

The Commissioner of Patents recently handed down McDonald v Vines 63 IPR 465. This is a useful case as it summarizes the often vexed issue of who actually owns an invention.

The dispute centred on the ownership of an invention for the treatment of incontinence. Vines filed a provisional patent application naming himself as inventor. McDonald subsequently filed a notice under section 32 of the Patents Act that provides for disputes between parties as to how a patent application should proceed. In order to defend himself, Vines withdrew the application and McDonald then filed an application under section 36 of the Patents Act for a declaration that he be an eligible person to be nominated for a patent.

McDonald and Vines had reached an agreement whereby McDonald would be involved in the development of the invention. As expected, the parties had different ideas as to what McDonald's contribution had been. However, it was common ground that Vines approached McDonald on the basis of McDonald's expertise in the field. The Commissioner took the position that McDonald must have had some idea of what Vines had invented. Also, McDonald did make some suggestions as to how the invention may be improved.

Citing previous cases, the Commissioner held that a person has entitlement to an invention if that person's contribution had a material effect on the invention. A material effect is that which results in the occurrence of an invention. The Commissioner noted that the onus was on McDonald to show on a balance of probabilities that he was entitled to be nominated for a patent. McDonald could not discharge this onus.

After considering the evidence, the Commissioner was of the opinion that McDonald had merely confirmed concepts already canvassed by Vines. In this regard, the Commissioner cited previous authorities when stating that the applicant needs to supply some improvement to the device which is not contemplated by the respondent and which is material to the invention.

As an interesting aside, Vines introduced evidence of research into the matter before communicating with McDonald. This took the form of web page printouts. However, the Commissioner pointed out that the date on these printouts was after meetings with McDonald. Clearly, Vines had re-visited these web pages to print them out. The Commissioner gave these documents very little probative value. This emphasizes the importance for inventors to track their web-based research carefully and pay particular attention to dates. Us patent attorneys live and die by dates!

My home page is: www.enb.com.au.

My email address is: beagar@enb.com.au.

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12 May 2005

Our International Rankings

Before I start, you can now get regular updates on this blog by clicking here.

I have just had a look at WIPO's yearly review of the international patent system - well, the pictures and tables anyway.

It appears that we rank 12th (1,846 or 1.5%) for number of international applications filed in 2004. We are behind:
1. United States (42,713 or 35.2%)
2. Japan (20,167 or 16.6%)
3. Germany (15,214 or 12.5%)
4. France (5,115 or 4.2%)
5. United Kingdom (5,039 or 4.2%)
6. Netherlands (4,196 or 3.5%)
7. Republic of Korea (3,553 or 2.9%)
8. Switzerland (2,837 or 2.3%)
9. Sweden (2,831 or 2.3%)
10. Italy (2,189 or 1.8%)
11. Canada (2,107 or 1.8%)

I must say, I am not sure what to make of that. According to a nifty site I found, the United States has a population of 295 million, while Australia has a population of 20 million. That means that in the US, there are 6,906 people per international application while in Australia there are 10,834 people per international application. In other words, the yanks are more inventive than the aussies. Come on, fellow citizens, get it going! I would like to retire in comfort, please.

The relevant website is www.wipo.int/pct/en/activity/pct_2004.pdf.There is also a promising graph on page 3 which indicates a fairly consistent growth in the number of overall filings.

My home page: www.enb.com.au

Email me: beagar@enb.com.au

10 May 2005

The Obvious Problem

I have recently been involved in a matter involving the question of inventive step. As I briefly set out in a previous post, in order to be patentable, an invention must involve an inventive step. In Australia, this means that, at the priority date, the invention must not be obvious to a person skilled in the art in the light of the available prior art. I am sure I will be posting something about "prior art" in the future.

Finding a skilled person is easy enough if the relevant priority date is recent. However, it is often the case that the priority date is 10 or more years old. It can therefore be very difficult to find the right person and for that person to recall his or her state of mind 10 years ago.

The skilled person must be one who is not overly qualified, but who has the knowledge that could reasonably be expected to have been that of a technician. I use the word "technician" loosely, since the necessary qualifications and experience of the nominal skilled person will depend on the subject matter of the patent.

Anyway, having found that often elusive representative of the skilled person, it is then necessary to set a questionnaire for such a person. The questionnaire must not disclose any aspect of the invention, since the answers will be tainted with "hindsight". For those curious, the relevant case is Aktiebolaget Hassle v Alphapharm Pty Limited [2002] HCA 59 (12 December 2002. The case is worth reading as it does manage to unravel some of the complexities of the inventive step requirement of our Patents Act.

While interesting, the whole exercise appears a little farcical to me. After all, how can it possibly be determined, on written evidence, that the nominal skilled person did not obtain some inkling of the invention? I would be interested in receiving comments from my foreign readers regarding the treatment of witnesses representative of the skilled person in the determination of obviousness.

In any event, Australian practitioners should be careful when using "object" clauses in a specification, where those clauses provide a guideline for such a questionnaire. For example, if the relevant claim were directed to an invention of a lightbulb filled with an inert gas, it may not be in client's best interest to include, by way of background: "An object of the invention is to prevent oxygen coming into contact with a lightbulb element." With such an object clause it would be legitimate to ask the skilled person: "How would you prevent oxygen from coming into contact with a lightbulb element?" (OK, so a silly example, but you know what I mean).

04 May 2005

What IPAustralia never told you about Innovation Patents

A number of years ago, we adopted the innovation patent system. This was in response to an alleged call from industry groups that it was both too hard and too expensive to obtain a standard Australian patent.

Anyway, the innovation patent system appears to be a mechanism that people can use to get a patent quickly. In fact all you need do is make sure the minimal formalities are met and, hey presto, you get a nice shiny patent deed. So now you can stop people from copying your invention. Not so fast...

I won't bore you with the relevant statutes, but our Patents Act sets out that an innovation patent is only enforceable once it has been certified. This requires that you request examination of the innovation patent. Examination is carried out to determine whether or not the invention (or, more correctly, the innovation) is "novel" and "makes a contribution to the art". Phone your patent attorney if you need further information as to what these mean. The important thing for the purpose of this discussion is that the innovation patent is really toothless until you subject the innovation patent to an examination.

If you pass the examination, well and good. You get the certificate and you can send out your letter of demand. However, if you fail the examination, the patent is revoked and you have nothing. Fortunately, examination can be requested at any time, so perhaps the existence of the innovation patent will manage to scare off potential infringers (yeah, right...).

A danger for holders of uncertified innovation patents lies hidden in the Patents Act. If you send a letter of demand to an infringer based on such an innovation patent, you could find yourself on the wrong end of a legal suit. So you need to make sure that you actually do have grounds to make threats.

In my view, the absolute biggest drawback with innovation patents is that they are published as soon as they are granted, which could be in one month from the date of filing. This has implications. You may come up with some significant improvements or developments to your innovation which may warrant the expense of filing a standard patent application. Unfortunately, you cannot file a standard patent application based on an innovation patent application. Thus, you may have to file a new application. You then will lose the benefit of the earlier date of the innovation patent. Worse, the scope of the subsequent patent application cannot encompass the material in the innovation patent, since that material would no longer meet the necessary novelty requirements due to publication of the innovation patent.

You must make sure that you file a provisional patent application together with the innovation patent application. The subsequent application covering the improvements and developments can then be based on the provisional, with the benefit of the provisional filing date. The extra cost is $80 only since the specifications of both applications can be the same.

If your patent attorney is not suggesting that you file both, then you should ask why or run away or both.

I cannot understand why IPAustralia does not have bold warnings about the potential shortcomings of the innovation patent system. Now, where is that letter to the Commissioner I was working on...

02 May 2005

Software - to patent or not to patent?

A vexed question to be sure. Perhaps, though, this posting will shed some light on the matter.

The patent system was developed back in the 1600's as a mechanism that inventors could use to protect their inventions. It follows that the rationale behind patents was defensive rather than offensive. If this is the primary reason for filing a software patent application, then a granted patent may not be as effective as one would hope.

My reasoning for this lies in the fact that all patent applications are published 18 months after the date of filing. Furthermore, a specification of a patent application must disclose sufficient information to a person of ordinary skill in the art to allow that person to carry out the invention. Accordingly, within 18 months, crucial algorithms and their implementation would be made available to the public. If an infringer were to copy the invention and then encrypt the copy, it could be very difficult to show that infringement actually took place.

So you may ask then: What's the use of software patents? Well, fortunately, we have moved beyond the era of protection and into the era of aggressive commercialisation. It is no longer sufficient to rely on copyright to protect your software. This is reflected in trends in the United States. Microsoft has increasingly found itself at the sticky end of legal disputes. See for example,
http://www.itweek.co.uk/news/1162487 where it is reported that Microsoft has had a preliminary injunction brought against the pending release of part of its Longhorn operating system. At http://news.zdnet.co.uk/software/linuxunix/0,39020390,39194883,00.htm, it is reported that IBM's patent number 295507 has caused PostgreSQL developers to rewrite substantial portions of their source code. For further information in connection with software patents have a look at this interesting website: http://wiki.ffii.org/SwpikxraniEn.

Anyway, the crux of this is that software patents are already having an effect on the software industry. It is also clearly better to have a software patent than not to have one. To rely on copyright is short sighted, in my view. Copyright cannot protect variations in implementation of particular algorithms, while patents certainly can. In fact there is growing group of software engineers and IP professionals who believe that patents are becoming more and more suited to software products.

A granted software patent exploited in connection with a successful software product can add significantly to the value of the software proprietor. Of course, as with all products, the software must make a new and valuable contribution to the field. Whether or not the software product is new can be determined, to some extent, by carrying out searches. Whether or not the software product is valuable would depend on your knowledge of the industry and whether or not you are able to leverage the product into the market place.

More posts on software patents will follow...