IP-Academy

Patent trolling

Patent trolling

Author: Danielle Carvey

Like many forms of intellectual property, patents can be leveraged in several ways by owners for their financial gain. This can oftentimes be abused, and one widely utilised form of such abuse is so called patent "trolling" or "hoarding", committed by patent trolls, often referred to as Patent Assertion Entities (PAE's), and Non-Producing Entities (NPE's). These entities obtain patents with the sole purpose of holding them "hostage" over other companies for fiscal gain, or to beat out the competition. They threaten other businesses with the same or similar patent subject matter, forcing the victim to decide between potentially lengthy and expensive litigation, or paying the trolling entity a sum of money to settle the dispute outside of legal proceedings. Patent trolling can be hugely detrimental to businesses and the economy as a whole, so what are the routes to resolving the threat of a patent troll?

A large number of victim companies subject to patent trolling in the USA opt to pay a settlement or license fee to the trolling entity outside of legal proceedings. One reason for this lies in the US court fees. For example, an estimated 5 million USD is spent per US patent lawsuit involving large corporations, whilst patent trolls strategically place their settlement fee below litigation costs, at an average of 2 million USD.

Another potential reason for frequent out-of-court settlement is that in the event the patent troll does succeed in litigation, the victim business could potentially lose its place on the market, and it may cost them greatly if the threatened infringement proceedings result in an injunction.

An alternate option would be to design around the alleged infringed patent, which may be successful in avoiding both a settlement fee and legal proceedings. This may, however, pose the risk of lowering the quality of the product and damaging the victims reputation on the market, therefore it is important to weigh up the risks of altering the product.

If a victim company does opt to proceed with litigation and fight back against the troll, there are a few stances that could be considered. For example, the victim may choose to enlist legal expertise before making a decision on whether to engage with proceedings. The expert will take a preliminary look at the subject matter which is targeted by the trolls, with the aim of assessing whether it does, in fact, infringe upon the trolling entity's patent, as well as the overall validity of the victim's patent covering the subject matter, should they have one. Legal clarity on these points can provide a solid basis on which to confront the trolling entity in court, and be a considerable factor in opting to litigate instead of paying a settlement fee.

Aside from the possibility of succeeding in the legal battle, it may be effective for the victim to invoke cancellation proceedings against the troll entity's patent. Furthermore, the discovery phase of litigation may uncover useful information on the trolling entity's patent(s), which can be advantageous for the victim in terms of their strategy in the long-term fight against the troll.

In light of the risks posed, businesses should remain aware and prepared for the event of patent trolling and subsequent litigation. If you believe you are falling victim to a patent troll, it is recommended that you consult with a legal professional. Contact us, if you wish to discuss.

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Patent priority rights play a pivotal role in the protection process for inventions, however, securing and maintaining such priority rights can be complex. Patent applicants can find themselves unintentionally losing the priority right to their invention due to unforeseen circumstances, and whilst it may not be ideal, there are solutions that could lead to their reinstatement in certain situations.

Application

Patent priority rights grant applicants an exclusive right to file for patent protection for their invention based upon an earlier application filed by the applicant. Priority rights are facilitated in multiple areas through international treaties such as the Paris Convention and the Patent Cooperation Treaty (PCT), for example.

Some jurisdictions allow for the reinstatement of patent priority rights if the failure to meet deadlines and subsequent lapse of priority was due to "due care", or if the lapse of priority was due to "unintentionality." These jurisdictions typically include countries that adhere to the Paris Convention for the Protection of Industrial Property, however, specific criteria and procedures for reinstatement vary by jurisdiction. Due to the nuanced nature of priority restoration, it is crucial to consult the patent laws and regulations of each country for detailed information on the requirements and process for reinstatement of priority rights.

As per the PCT, in instances whereby a patent application possesses an international filing date later than the date the priority period lapsed, the applicant may request restoration of priority if done so within two months from the initial expiration date and if the Office finds that the correct criteria apply.

Grounds for reinstatement

Due Care

One available route for the restoration of priority is by applying for reinstatement based upon due care criteria. In the sphere of patent priority rights, due care refers to the level of responsibility and diligence expected from patent applicants in managing their applications and complying with relevant regulations and obligations. There are generally strict criteria which must be met in order to obtain reinstatement of a priority right via due care grounds.

If a lapse of priority is deemed to have occurred in spite of due care that a “reasonably prudent applicant would have taken” in the patent application process, the priority rights may be restored for an applicant by an IP Office.

In order to meet the standards for due care criteria for the reinstatement of priority rights, patent applicants must demonstrate that they have met a series of high standards as it is not sufficient for an applicant to simply demonstrate that they had generally taken precautions to adhere to time limits, for example.

Instead, the applicant should demonstrate that they exercised complete due care for the entire application, with the Receiving Office assessing all factual elements of the applicant's actions pertaining to the filing of the international application up to the expiration of the priority period. Any actions taken by the applicant after the expiration of the priority period will not be taken into consideration when determining whether the applicant took all actions necessary to demonstrate due care.

Due Care Criteria

The criteria that will typically be examined by an IP Office in order to establish that an applicant took all due care in order to reinstate a priority right include:

1. Lack of Knowledge by the Applicant
2. Lack of Financing by the Applicant
3. Human Error by the Applicant or Agent Himself
4. Miscommunication between the Applicant and the Agent
5. Absence from the Office by the Applicant or Agent
6. Human Error by the Agent’s or Applicant’s Staff
7. Docketing System Error
8. Facsimile or Software Submission Failure
9. Postal Service Difficulties
10. Force Majeure

The IP Office will factually analyze each of these criteria in accordance with the requirements and in comparison to what actions they would deem a “prudent applicant” would have made in order to have complied with the due care criteria.

Unintentionality

The Unintentionality Criterion is another possible route for the reinstatement of priority rights, and overall the requirements for the meeting of such criteria are less stringent than those needed to prove due care was taken by an applicant.

Overall, a Receiving Office should restore a priority right if it is found that any failings on behalf of the applicant to file the international application within the set priority period was unintentional. In order to meet this criteria, an applicant must be able to demonstrate that they did not deliberately refrain from filing the international application within the priority period and that they had every underlying intention to file within the priority period.

Unintentionality Criteria

Some of the most common circumstances that apply for the unintentionality ground for reinstatement of priority include:

1. Lack of awareness
2. Misunderstanding of the law
3. Reliance on incorrect information

In essence, the focus on whether the applicant should meet the unintentionality criteria or not should lay upon the Receiving Office’s assessment as to the applicant's intent at the expiration of the priority period, regardless of their intent before or after the priority period.

Statement of Reasons

Whether an applicant intends to rely on the due care or the unintentionality criteria in order to apply for the reinstatement of priority rights, the applicant is required to set forth to the Receiving Office the reasons why the application was not filed within the established period. These reasons should be submitted in the form of a “Statement of Reasons.”

With regard to said statement in relation to the due care criterion, it should contain a detailed description of all facts and circumstances that amounted to the late filing of the international application past the priority expiration. Further, the statement of reasons in relation to due care grounds for reinstatement should also depict any remedial steps or alternative remedies that the applicant sought in an attempt to file the application within the priority period.

If the grounds for reinstatement are based upon the unintentionality criterion, the statement of reasons should detail that any failure to comply and submit the international application within the assigned priority period was entirely not intentional. Should the Receiving Office not find the statement of reasons sufficient, they may invite the applicant to submit a revised statement.

Moreover, supporting evidence will assist alongside the Statement of Reasons in demonstrating that the lapse of priority for an applicant should be reinstated based on either the due care criteria, or the unintentionality criteria.

Overall, reinstatement of priority owing to grounds of due care is a more strict criterion that focuses on the proactive measures taken by individuals or entities to prevent intellectual property infringement, whilst the unintentionality criterion is typically more flexible.

In amongst the nuances of priority reinstatement regulations, there is hope for applicants who may have lost patent priority rights. If you are interested in learning more about the possibilities of reinstating patent priority rights, or if you would like our assistance with your matter, contact us via our social media or website at https://www.ip-coster.com!

According to Article 115 of the European Patent Convention, any person can submit their observations regarding a European patent application, or a European patent pending before the European Patent Office (EPO), in order to contribute relevant information to the examiners at the EPO. Such submissions are called third-party observations (TPOs) and serve as a valuable tool in the patenting process.

TPOs have an accelerating effect on a patent application. Submitting non-anonymous, well-supported observations pursuant to Article 115 and Rule 114 EPC substantiating a lack of patentability during examination can expedite the next Office Action from the EPO. This mechanism differs from the submission of a PACE request, as it only accelerates the next substantive communication from the EPO.

TPOs, which are sent to both the examiner and to the applicant for consideration and comment, not only help to prevent a patent from being wrongly granted, but can also lead to the amendment of patent claims. s Alongside the possibility of amendments to the patent claims, a TPO may also result in the granting of a patent with a lesser scope of protection.

Third-party observations can relate to patentability, novelty, inventive step, sufficiency of disclosure, lack of clarity, or amendments that are not allowed as per the rules. Observations must be filed while the proceedings are still ongoing to effectively influence the examination. TPOs filed after a patent has already been granted will be neither considered nor made available for file inspection.

TPOs are typically submitted using an online form via the EPO website, with no official fee required to be paid for the submission. They must be filed in one of the official languages of the EPO (English, German or French) and explain the grounds on which they are based. The supporting documents may be filed in any language, although the EPO may request the translation within a prescribed time period.

TPOs may be submitted anonymously, yet it is important to note that the submitting party mustn't already be a part of the proceedings and are not permitted to join the proceedings following the filing of the TPO. The EPO will not directly inform the filing party of any further action that was taken in response to their TPO, however the outcome will be confirmed in the office actions and published by the EPO.

Third-party observations are important in ensuring that the patent examination process is strong and accurate. By welcoming contributions from external parties, the EPO gains diverse knowledge and expertise, enhancing the examination process and making sure that granted patents meet high standards within the European Union.

The Eurasian Patent Organization and Office (EAPO) is an intergovernmental organization founded in 1995 with the aim of promoting the development and protection of intellectual property across the region, in accordance with the Eurasian Patent Convention (EPC). The EPC was first signed on September 9, 1994 and entered into force on August 12 of the following year, formally establishing the EAPO.

Member states to the EAPO include countries from both the Commonwealth of Independent States (CIS) and non-CIS countries, fostering international collaboration in the field of IP. These Member States in 2024 include Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Turkmenistan. The EAPO headquarters are located in Russia with the official language of the Office being Russian.

The EAPO's main aim is to facilitate intellectual property protection for inventions and industrial designs via one Eurasian application that is valid throughout all 8 Member States. As such, the Office plays an important role in streamlining the IP application process throughout Eurasia, providing a unified platform for inventors and businesses to seek protection for their ideas in multiple member states simultaneously. The EAPO system therefore simplifies procedures for patent and design protection, reduces costs, and enhances efficiency, contributing to the growth of innovation and technology within the region.

The Office has provided protection for Eurasian patents since its origin, and began to accept applications for regional industrial design protection in June 2021 following the adoption of the Protocol on the Protection of Industrial Designs to the Eurasian Patent Convention in 2019.

In order to obtain a Eurasian patent valid in all EAPO Member States, an applicant should file just one application to the EAPO which can be submitted in any language so long as it is followed by a Russian translation within a 2 month period, or within 4 months if the corresponding fee is paid. A Eurasian patent may also be obtained on the basis of a PCT application by entering the Eurasian regional phase within 31 months from the earliest priority date. Eurasian patent applications are subject to substantive examination with an applicant required to submit a request for the same within 6 months from the date of publication of the search report for conventional applications. For PCT based applications the substantive examination should be requested upon regional phase entry.

Once a Eurasian patent is granted, the patent holder is able to decide which Member States they wish for the patent to be maintained, as well as restore lapsed Eurasian patents due to unpaid maintenance fees. Applicants may also extend the term of validity of Eurasian patents in certain invention areas. During the period of time between the publication of the Eurasian patent and the payment of the first annual maintenance fee, the patent holder has the exclusive right to their invention in all Eurasian countries.

All fees in relation to Eurasian patents or industrial designs are paid to the EAPO directly, as opposed to each respective EAPO Member State individually. The filing fee for Eurasian patents may be reduced by 25% if the application contains an already produced international search report or PCT search report by another ISA, and by 40% if such reports were produced by the Rospatent.

As of 2022, the EAPO also acts as an international search authority (ISA) and an international preliminary examination authority (IPEA) in accordance with the PCT.

The EAPO has participated in multiple international collaborations, including the signing of Memorandums of Understanding (MoU's) with the African Intellectual Property Organization (OAPI), the African Regional Intellectual Property Organization (ARIPO), the European Union Intellectual Property Office (EUIPO), the European Patent Office (EPO) and the World Intellectual Property Organization (WIPO).

Moreover, the EAPO also engages in Patent Prosecution Highway programmes with several IPO's worldwide inclusive of the Japanese Patent Office (JPO), the Korean Intellectual Property Office (KIPO), the Finnish Patent and Registration Office (PRH) and the EPO, facilitating an expedited patent processing time through the sharing of examination findings with the respective IPO's of the PPH agreements.

The EAPO's commitment to intellectual property rights underscores its significance in fostering a conducive environment for research, development, and economic growth in the region. If you would like to find out more information on how to file for IP protection in Eurasia or via the EAPO, please contact us via our social media platforms or here!

The European Union Intellectual Property Office (EUIPO) is a regional IP office and European Union Agency founded in 1994, located and headquartered in Alicante, Spain. As such, the EUIPO facilitates the protection of European Union trademarks (EUTM), formerly a "community trade mark", as well as Registered Community Designs (RCD). An alternative name for the EUIPO is in the French language, namely “Office de l'Union européenne pour la propriété intellectuelle”.

The office was founded and operates on the basis of Regulation (EU) 2017/1001 of the European Parliament and of the Council of 14 June 2017 on the European Union trade mark. As an international hub for intellectual property matters, the office operates in five working languages, namely English, French, German, Italian and Spanish. Applications received by the EUIPO can be processed in the twenty-three official languages of the EU.

Registered Community Designs, as well as EU trademarks registered through the EUIPO, benefit from unitary protection effect across all EU Member States. Registered trademarks and designs with the EUIPO are published and the information made publicly available in the corresponding IP registers managed by the office. The Register of European Union trademarks, for example, contains particulars of all EU trademark applications and registrations, whilst the Community Design Register contains information pertaining to registered EU designs. Both of these registers are continually updated to track any amendments to EUTM's or RCD's such as ownership information and licencing.

The EUIPO also publishes the EU Trade Marks Bulletin and Community Designs Bulletin containing said registrations, as well as other relevant information available to the public.

In addition to facilitating the registration of RCD's and EUTM's, the EUIPO also maintains the Orphan Works Database, providing access to information relating to orphan works contained in the collections of publicly accessible forms such as educational establishments and archives in Member States.

Furthermore, the office oversees the Observatory on Infringements of Intellectual Property Rights, aiming to assist in the fight against counterfeiting and piracy by raising public awareness through the encouragement of best practices and cooperation. The EUIPO has overseen both Orphan Works and the Observatory of Infringements since 2012.

The EUIPO is a vital IP office for the facilitation of intellectual property throughout the European Union, with the office examining over 150,000 EUTM applications and 90,000 RCD applications every year. Moreover, the office allows for a multitude of international cooperations and initiatives spanning across the globe, aligning with the European Commission external actions policy priorities. As such, the EUIPO aims to create awareness on the benefits of IP protection and registration, encouraging innovation as a source of economic development across the EU.

Furthermore, the office supports the development of the administration of IP and enforcement services by modernizing legislation and promoting participation in international IP Treaties. Through Memoranda of Understanding (MoU), the EUIPO forges collaborations with other IP offices directly, identifying actions that can benefit the IP field in EU Member States and the IP sphere on a global level.

The EUIPO also engages in the TM5, consisting of five major IP offices for trademarks, and the ID5, comprising five major IP offices for industrial designs. These five offices include the CNIPA, EUIPO, JPO, KIPO and USPTO in close collaboration with the World Intellectual Property Organization (WIPO).

The EUIPO serves as a focal point for not only the European IP sphere, but for IP protection on a multi-regional level too.