On 25.05.2023, I had the opportunity to follow online a conference/discussion organised and hosted by the Department for IP of the University of Osnabruck.
Introduction to the event
Since the publication of the Patent Quality Charter by the European Patent Office (EPO), a lively discussion has flared up whether the EPO is setting the right priorities in improving processes and accurately assesses the interests of the stakeholders.
Between the lines, the EPO seems to be a “granting authority“, while users of the patent system would prefer an “examining authority“.
The right balance between effectiveness & thoroughness is a core problem of procedural law for which there is no one size fits all solution.
Rather, the procedure must be adapted to the objectives of the respective substantive law as well as the protected interests of the parties and the public. Accordingly it makes sense to consider who can make what contribution to improving patent quality.
Against this background, the initiators of the Industry Patent Quality Charter invited to a panel discussion on the occasion of the “Osnabrucker Patent Days 2023”.
Programme of the discussion
Welcome Beat Weibel
The advantage of substantive patent examination Mary-Rose McGuire
The EPO’s examination practice: a sample in figures Daniel Skiebe
The value of diligent search and examination from an industry perspective Jörg Thomaier
Patent grant rates: A question of examiner seriousness? Beat Rauber
Discussion Chair: Beat Weibel
The discussion took place on Thursday, 25 May 2023, 16h-17h30.
Brief report of the event
The head of the department as well as representatives of the IPQC spoke, but also a searcher from the university which presented some interesting figures.
At the beginning two diagrams were presented. On the one hand, the time used by applicants to prepare applications has apparently increased over time by around 35%, whereas in the same period, the time apparently used by examiners in order to deal with a file has decreased by around 40%.
The main reproach made towards the EPO is that it takes more care about the form and speed of decisions than their correctness.
As introduction the head of the IP department compared the pro and cons of determining the validity of an IP title a posteriori, which is in case of litigation, or up front that is by examination before grant. Both have advantages and disadvantages. One thing was however clear, if search and examination precede grant, both have to be of high quality.
The data provided by the searcher appear statistically significant and showed that the survival rate of patents after opposition and appeal is rather low. This seem to be the consequence of an incomplete search and examination. The analysis of the searcher was based on published decisions of the BA. The figures were broken down according to the filing year.
It is only in a low number of cases, 8,7%, that literature found by opponents was not available in the search files of the office.
A comparison of the survival rates after opposition (with a kind of equilibrium between the three possible outcomes) and appeal, showed that after appeal much more patents are revoked or maintained in amended form and the survival rate of unamended patents is much lower.
What was interesting was a comparison between the revocation/amendment rates between the BA and the German Federal Patent Court. Although for the latter, there are less cases, the figures are comparable.
According to the speakers from industry, the incomplete search seems due to the fact that, on the one hand, the prior art revealed by the search is incomplete, and on the other hand, not all the features of claim have been taken into account.
All speakers, but, for obvious reasons, not the searcher, have explained that in private conversations examiners complained about the ever increasing production pressure. This does not mean that examiners want a cushy job, on the contrary, they consider that they are just not given the resources, especially time wise, to correctly carry out their job.
One consequence is that examiners avoid as much as possible interviews and OP in examination and rather prefer to grant. Interviews and OP simply take too much time. It was pointed out that a request for OP in the event of refusal has become almost systematic, and yet there are not many OP in examination.
Although it was based on the observation of specific directorates, one speaker of the industry showed that decisions taken by experienced examiners are, as a group, much more coherent than decisions taken by examiners with less experience. For the latter he even spoke of a kind of lottery. One of the possible causes was inadequate training. The IPQC reiterated its offer for training of examiners.
One suggestion was to bring examiners more together and not only to discuss cases by electronic means. The necessity of more face to face meetings of examiners was insisted upon.
One case was reported, in which, with the communication under R 71(3) the e-mail exchange between members of the division was inadvertently attached. The examiner in charge expressed his doubts about patentability. The chair had also doubts, but advised grant, claiming that opposition would be a corrective…. The file number was not revealed, and the e-mail exchange had disappeared from the public part of the register.
What was also criticised was the length of the procedure, especially the time in appeal. An average length of 14 years was way too long. It was acknowledged that the situation is improving, but efforts still need to be made.
One industry speaker said that it is frustrating for an applicant/proprietor to have spent a lot of money to see its patent revoked after a long time, and for opponents to have as well to spend money in order to obtain a limitation or revocation of a patent. All this money could be saved if search and examination would have been carried out thoroughly. One added that speed is not everything.
An important comment was that some national courts presently refuse to grant preliminary injunctions based on EP patents, as they were not sure that those patents were strong enough. In case of an opposition or nullity, the proceedings are rather stayed. Some courts do not have the same approach and still quasi automatically grant preliminary injunctions. All in all, the situation is not satisfactory for proprietors or litigants.
One major concern expressed by all industry speakers was the upcoming of the UPC. Especially in view of the high costs of litigation before the UPC, industry speakers expressed their concern: what good is it, if patents do not survive a thorough review by the litigating parties at the end of this expensive procedure?
The head of the IP department noted with interest that some EPC contracting states, NL, FR, CH, were introducing examination and even opposition procedures. She concluded that the national route would become interesting again and would avoid the necessity to go to the UPC. In this respect, it is worth noting that FR and DE will accept the coexistence of a national and a patent with unitary effect.
A point which was briefly touched at the end of the meeting were the attempts of the EU Commission to interfere directly in patent matters by creating at the ‘EUIPO specialised sections dealing for instance with unitary SPCs and SEP/FRAND matters. All speakers noted that the EUIPO has no competence in patent matters and were rather hostile to the move envisaged by the EU.
Some speakers considered that the granting of unitary SPCs should be a task of the EPO and not of the EUIPO. All regretted the distance between the EU and the EPO.
All in all, the way the EPO deals with applications and patents was not considered too positive. All speakers however insisted that the EPO is working better than other patent offices, but in view of the perceived decline in quality, things had to improve at the EPO.
Comments
Don’t shoot the messenger. I am not in a position to decide on the correctness of the figures shown, but the overall impression was that a thorough work had been carried out at the University of Osnabruck.
The concerns expressed by the various speakers were genuine and at no moment one could have the impression that the speakers were criticizing the EPO for the sake of it.
The distance between the EPO and the EU is the direct consequence of the events preceding the creation of the EPO and the inability at the time of the European Community, now the European Union to agree on a patent for with unitary effect for the, then much smaller, European Community.
On the verge of the opening of the UPC the move of the EU Commission to open specialized departments at the EUIPO is difficult to follow.
Comments
4 replies on “IPQC meets Uni Osnabruck”
Dear Mr Thomas,
Thank you for reporting the IPQC panel discussion, it is very interesting indeed.
I generally agree with IPQC’s critical comments of IPQC. A couple remarks though.
The expectation of quality as to the search by the EPO is to be viewed in context. Examination by the EPO and infringement proceedings are entirely different contexts. Given the stakes, a defendant may mobilise very substantial resources (time, cost and specialised expertise) to spot prior art more relevant than that cited by the EPO, out of proportion to the limited time an Examiner may spend to carry out a search.
I also wish to point out that quality at the EPO is a shared responsibility. Applicants’ practices may not be optimal for quality. For example, the use of claim-like clauses in the original description, supposed to ensure perfect support for the claims, generates problems of its own when the claims are amended. The compliance of the claim amendments with Art 123(2) remains based on the original application, irrespective of adaptations of the claim-like clauses of the description to the claim amendments. In my view, the adaptation is essentially cosmetic. But it entails additional work for both the EPO and applicant, let alone Art 123(2) potential issues and recent divide between BOAs.
As to the EU Commission draft proposal regarding SCPs and FRAND licensing, critical comments have been voiced by many, pointing out in particular the lack of competence of EUIPO in patent matters. I share this concern. This is bound to be an uphill battle for the Commission anyway.
However, I think it is misleading to call SCPs and FRAND licensing « patent matters ». These issues should rather be described as competition law issues in the framework of the internal market, even though they involve patents.
The EPO is clearly not qualified for dealing with these issues since it does not belong to the EU legal order and its BOA decisions are not subject to review by the CJEU, contrary to the EUIPO.
Dear Mr Hagel,
Thanks for your comments.
I can agree with you that, when it comes to challenging the validity of a patent, an opponent or a party wanting to request nullity, will not spare its efforts for finding appropriate prior art to challenge the validity of a patent.
I am the last wanting to overrate the possibility opened by opposition/nullity proceedings to come to conclusions about the quality of search an examination. Only around 5% of granted patents are actually opposed. Some technical areas have either no oppositions, as lots of applications are refused, or because there is a kind of tacit or explicit agreement of non-aggression.
On the other hand, a former president of the EPO is meant to have said that a patent is an insurance in case of success. A patent opposed or faced will nullity can be considered as a successful patent. At least third parties are disturbed by its mere existence. However, what is it good when the patent collapses at the first opportunity?
Be it for my blog or in view of my teaching duties, I look at lots of published decisions. Sampling published decisions, I often come across the fact that an opponent has come up with highly relevant prior art which was not found during the original search, but was available in the EPO’s search files.
This happens for files in which the search report mentions many documents of X, Y or even A category. I do not have a figure, but I have the feeling that it is only in rather low number of cases that the opponent comes up with prior art which was not, and could not be available, in the EPO’s search files. I think here of public prior uses, public oral disclosures or PhD dissertations.
When for instance, the opponent comes with prior art under Art 54(3), sometimes from the proprietor himself, then manifestly something has gone wrong. The same applies if the prior art under Art 54(2) is classified in the same classification units as those of the patents or in which a search has been carried out.
I have no position as such whether the EPO is qualified or not to grant SPCs. This was a suggestion from the panel, and I have seen the same suggestion in various blogs and publications. One thing is to be noted: it is not necessarily a sign of confidence towards the, soon to be opened UPC, that the EU Commission wants to give the EUIPO a say in the matter. The EU Commission might have realised, but it is a bit late now, that the UPC does as well really not belong to the EU legal order and the decisions of its Court of Appeal are not subject to review by the CJEU, contrary to the EUIPO.
As far as the SEP/FRAND issue is concerned, the same considerations as for SPCs apply mutatis mutandis. I would be more inclined to say that determination of the SEP character of a patent is rather a question of standard setting organisations. They are the best equipped to decided what is a SEP and of how many SEPs support a standard.
If during opposition, it turns out that there is a problem of added subject-matter I agree with you that the responsibilities are shared. the examiner should have spotted it, but the applicant was too happy to get a patent granted.
Dear Mr Thomas,
Thank you for your response.
The UPC was not the topic of this post but since you referred to it in your comment, I was extremely surprised by your assertion that it does not belong to the EU legal order. Certainly it does.
For one, it is based on the UP Regulation 1257/2012 which itself refers to Article 13 of the Enforcement Directive 2004/48.
Then the UPCA is replete with statements that it belongs to the EU legal order :
Article 1 « The Unified Patent Court shall be a court common to the Contracting Member States and thus subject to the same obligations under Union law as any national court of the Contracting Member States ».
Article 20 « The Court shall apply Union law in its entirety and shall respect its primacy »,
Article 21 « As a court common to the Contracting Member States and as part of their judicial system, the Court shall cooperate with the Court of Justice of the European Union to ensure the correct application and uniform interpretation of Union law, as any national court, in accordance with Article 267 TFEU in particular. Decisions of the Court of Justice of the European Union shall be binding on the Court.
As to preliminary rulings and their relevance to the operation of the UPC, a recent CJEU decision is very much in point : C 628/21 of 21 April 2023 following a preliminary ruling from the Warsaw Appeal Court. This decision deals with the right to request information under the Infringement Directive 2004/48 and while it relates to copyright, it appears quite relevant to Article 59 of UPCA.
As to the suggestion that standard setting organisations should have a role in FRAND licensing, ETSI is strongly against this notion in order to remain neutral and protect their independence. This is well known and was apparent in the dispute Philips v. TCL & ETSI before French courts.
Dear Mr Hagel,
I read your latest comments with interest.
In principle, I could agree with you that the UPC does belong to the EU legal order.
The legal sources you have given would a priori lead to this conclusion.
If the UPCA would be applied as it stands, than I could even better agree.
However, what matters here is not just what is written in the UPCA, but how those legal rules are put into practice.
I personally consider that the UPC cannot be a court belonging to the EU legal order for a series of reasons.
The first is that the presidium of the UPC has no competence whatsoever to decide to amend the treaty as it has done by deciding that the files in class A and C originally allotted to the London section of the central division of will be provisionally allotted respectively to Paris and Munich. Could you imagine for instance, that the members of the Benelux Court decide by themselves that some provisions of the treaty as ratified by the respective parliaments can be ignored?
The second is the decision yet to come of the Administrative Council to introduce in Art 87(1) a new revision in 2026 as is envisaged according to the agreement between France, Germany and Italy and later to transfer some duties to Milan.
According to Art 87(2) UPCA, the Administrative Committee may amend the UPCA to bring it into line with an international treaty relating to patents or Union law. It is a daring interpretation to consider that Brexit is a treaty relating to patents. Brexit has been affecting the Union, but Art 87(2) has never been designed in order to overcome the problems created by Brexit.
The UPCA is a treaty submitted to the Vienna Convention on the Law of Treaties. In view of the crystal clear wording of the UPCA, the VCLT gives little, not to say none, room for the interpretation of its content.
I would further note that the “withdrawal” of the UK is anything but certain as it has en simply been announced by a mere “Note Verbale” and the UPCA does not contain any exit or withdrawal clause. Hence, it is not even certain that Art 7(2) UPCA is moot. The VCLT contains provisions for case that treaty does not comprise an exit clause. those have to up to now been superbly ignored.
It is clear that without the participation of the UK, there is no reason to have a section of the central (sic) division in London. From a pragmatic point of view one can thus consider that Art 7(2) UPCA cannot have any effect. The problem is that Art 7(2) UPCA is part of treaty in which not a single iota has been altered.
According to the VCLT, interpretation of a treaty is of the competence of the parties to the treaty, i.e. by the contracting states. Any interpretation according to the treaty has thus to be carried out by representatives of the contracting states. The members of the Presidium are manifestly not representatives of the contracting states, and yet they decided to interpret the UPCA!
It is worth remembering that the “Preparatory Committee” (chaired by the now Registrar) had announced a common declaration under Art 31 VCLT with the aim of replacing UK by IT in order for the PPA and PPI to enter into force. Such a declaration has never been thought for and has neither been signed nor published.
On the contrary, the “Depository” declared on its volition that that the PPA and the PPI were in force. The legal basis allowing the depository to decide on the entry in force of the PPA and the PPI and hence of the UPC appears lacking. Simply receiving the ratifications cannot be equated with a right to decide whether some legal texts are in force or not.
Whether a court deciding itself how the treaty by which it was founded is to be interpreted, and whether Art 87(2) has been correctly applied when it comes to amending again the competence of the same court, is actually a court according to Art 6(1) ECHR remains to be seen. More than strong doubts are permitted.
The only clean and correct way to take Brexit properly into account, would have been to renegotiate the UPCA with the aim of deleting any direct of indirect reference to the UK. It is clear that it would have meant a re-ratification, at least partially. This is the solution the supporters did not want to hear of, as it would not have been certain that the UPC would have opened its doors in the near future. They preferred to stick with dodgy solutions which do not resist a careful assessment.
For the surplus, I refer to my post of 04.01.2023 on this blog:
https://blog.ipappify.de/is-after-brexit-the-upc-agreement-compatible-with-eu-law/
That ETSI does not want to be dragged into valuation discussions is understandable, but it remains that a SSO is the best place to decide which patent is to be considered a SEP and which contribution it makes to the standard. the the EUIPO is more competent can seriously be put into question.