An Opportunity for Harmonization

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An Opportunity for Harmonization
Charles Eloshway Patent Attorney Office of Policy
and External Affairs United States Patent and
Trademark Office
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IP Turning Ideas into Jobs

• The Obama Administration Has Put Priority on
  Innovation and Technology
• Strategy for American Innovation, Sept 2009
• IP as a driver of economic growth and job
  creation
• Start Up America
• Economic and Social Imperative
• Economic recovery and growth
• Need to Spread Technology Across Borders
• Open Markets
• Bring Life-Saving Technology to those in need

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The Economic and Social Imperative

• Economic recovery and sustained growth requires
  innovation on many levels
• Technological innovation to spur economic growth
  and jobs
• Systemic innovation to do things in a new and
  different way, consistent with 21st century
  realities
• Need to Spread Technology Across Borders
• The new economy is knowledge-based and global
• IPRs are key
• Open new markets
• Promote development and delivery of new
  technologies, including life-saving products for
  those in need

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The Need to ModernizeOutdated Patent Laws

• Many patent laws are stuck in the last century
• They are out of touch with the way modern
  businesses think and act
• The international patent system, ironically, is a
  laggard among commercial legal regimes
• Global markets require global patent protection
• Laws and procedures still differ substantially
  from country to country, creating obstacles of
  obtaining international patent protection
• Harmonization is critical to obtaining global
  patent rights effectively and efficiently

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A Brief History of Harmonization PCT and PLT
1991

• Patent Cooperation Treaty (1970)
• Streamline international patent filings
• User-friendly 30-month period for making filing
  decisions
• Problemsno effective harmonization unachieved
  work sharing potential
• PLT Hague Diplomatic Conference (1991)
• Built on WIPO Committee of Experts process,
  initiated in the mid-80s
• Failed on first-to-file issue

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A Brief History TRIPs, Procedural PLT and SPLT

• TRIPs
• Harmonized certain minimum standards for patents
• Many areas left to national/regional law
• Procedural Patent Law Treaty (PLT 2000)
• Set maximum formalities standards
• Specifically excluded substantive matters
• Substantive Patent Law Harmonization (SPLT)
• Substantive discussions were revived at WIPO in
  2001
• No agreement on appropriate scope of norm-setting

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A Brief History Group B

• Stalemate at WIPO led to establishment of Group
  B
• Initiated by the USPTO in 2005
• Includes WIPO Group B and some non-Group B
  entities (e.g., EPO, EC)
• Some agreement on text, but progress stalled in
  2006, mainly due to disagreement on grace period
  and 18-month publication
• Some studies and other work since 2006

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The Leahy-Smith America Invents Act, P.L. 112-29

• Most significant change in patent law since 1836
• Provisions discussed over the course of five
  Congresses while
• Active discussion in the courts and in industry
  circles on needed changes to existing US patent
  law
• Significant backlog at the USPTO, funding
  uncertainty

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America Invents Act

• Goals of Patent Reform Legislation
• Encourage innovation and job creation
• Support USPTO's efforts to improve patent quality
  and reduce backlog
• Establish secure funding mechanism
• Provide greater certainty for patent rights
• Provide less costly, time-limited administrative
  alternatives to litigation

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AIA and Harmonization

• Congress recognized the significance of a
  transition to first-to-file and stated in section
  3(p) of the America Invents Act
• It is the sense of the Congress that converting
  the United States patent system from first to
  invent to a system of first inventor to file
  will improve the United States patent system and
  promote harmonization of the United States patent
  system with the patent systems commonly used in
  nearly all other countries throughout the world
  with whom the United States conducts trade and
  thereby promote greater international uniformity
  and certainty in the procedures used for securing
  the exclusive rights of inventors to their
  discoveries.

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USPTO Initiative in 2011

• In an effort to re-energize interest in
  substantive patent harmonization, the USPTO
  hosted the Asia-Pacific Patent Cooperation
  Forum for the 21st Century, March 7-8, 2011, in
  Alexandria, VA
• Informal discussions among like-minded economies,
  including interested developing countries, led by
  Heads of Offices
• Our efforts today are about beginning a
  substantive dialogue to put patent law
  harmonization back on track. Theyre about
  collaborating on what makes the most sense for
  our shared global currency of innovation in the
  21st century.
• USPTO Director David Kappos, Opening Remarks

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From the Statement of the Participants at the
APPC Forum

• The time for substantive harmonization is now.
  We are operating in a global economy, business
  innovation is happening across borders. The IP
  system needs to be supportive of this new
  reality.

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The Time for Harmonization is Now

• USPTO is acting on a vision of an IP world in
  which national and regional patent systems are
  harmonized in pursuit of creating an optimal
  environment for technological innovation and
  diffusion.
• The Fragmented International System
• Increases Costs and Decreases Certainty
• Forestalls Innovation and Economic Growth

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Outdated Misconceptions

• Harmonization is not a four letter word
• Harmonization is about adopting best practices
  that make good sense for all offices and users
• This is not a zero-sum game
• It is not about negotiating trade-offs of aspects
  of existing patent systems
• It is not about pitting developed versus
  developing countries
• It is about creating a better system that
  improves access to technology, lowers costs,
  streamlines procedures for all

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Harmonization Issues

• The usual suspects
• First-inventor-to-file
• Grace period
• Relationship (or not) to 18-month publication
• Definition of prior art
• The Hilmer doctrine
• Secret Prior art used for Novelty only, or also
  for Nonobviousness
• Definition of novelty
• Definition of non-obviousness/inventive step
• Disclosure requirements, including best mode

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Impact of AIA on Harmonization

• The AIA effectively harmonizes US law with that
  of major trading partners with respect to
• First to File
• Hilmer
• Significant aspects of how prior art and novelty
  are defined (elimination of geographic
  restrictions, filing date-based)
• Best Mode
• Maintains existing alignment with respect to
  non-obviousness/inventive step
• Significant remaining issues Grace Period and
  Prior Art Effect of Secret Prior Art

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Grace Period

• AIA provides for a 1 year grace period from the
  earliest effective filing date for disclosures by
  inventor or a party who obtained the information
  from the inventor
• Innovation-friendly enhancements
• Non-derived disclosure by another will not be
  prior art if the inventor disclosed earlier and
  filed within the grace period
• Earlier filing by another will not be prior art
  if the inventor disclosed earlier and filed
  within the grace period

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Grace Period

• Key issue for harmonization Lack of a
  harmonized, 1-year grace period causes innovators
  to lose rights in key markets
• The grace period is user- and business-friendly
  and accounts for 21st Century business and
  academic practices
• Helps SME sector pursue funding quickly without
  losing access to patent rights
• Enables protection, commercialization and prompt
  disclosure of university research
• Aligns with fast pace of modern business cycles
  and competition

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Prior Art Effect of Secret Prior Art

• US approach under AIA remains novelty
  non-obviousness/inventive step
• Other jurisdictions use novelty-only
• Issues
• Fairness to third party applicants
• Fairness to first inventor to file
• What about patent thickets?

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In the Meantime Work sharing

• Fruitful discussions are taking place in the
  context of the Trilateral Office (USPTO, JPO,
  EPO) discussions, and IP5 (Trilateral, plus Rep.
  of Korea and Peoples Republic of China)
• Common Citation Document Ten Foundation Projects
• Bilateral negotiations have led to a successful
  Patent Prosecution Highway (PPH) network
• Accelerated examination in a second office, based
  on successful examination in the first office
• Expanded to PCT-PPH

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Harmonization and Work sharing

• Harmonization and work sharing are complementary
• Top-down alignment of applicable law
• Bottom-up convergence at the practice and
  administrative level
• Harmonization promotes optimal work sharing
• In theory, the more aligned the substantive law,
  the more reusable the work
• Work sharing can inform harmonization efforts

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What is Next?

• Harmonization
• Tegernsee Group (US, UK, France, Germany,
  Denmark, Japan and EPO)
• B
• Objective Identify issues for harmonization and
  define process for achieving it
• Work sharing
• Enhance and refine the PPH
• Explore other cooperative relationships
• Improve functioning of PCT

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Thank You!

• Charles Eloshway
• Patent Attorney
• Office of Policy and External Affairs
• United States Patent and Trademark Office