The COVID-19 pandemic has had widespread impact on business operations of patent offices across the world. Several countries have acquired patents but there is a need to leverage international filing protocols in order to decide the validity of their patents. Owing to information available in a centralized database, agreements such as Madrid Protocol and the Patent Cooperation Treaty (PCT) have helped to streamline IP filing and search procedures.
For example, the Patent Cooperation Treaty enables deferment of major expenses for international filings. The developments in Europe have shown new IP trends that can be highlighted.
Patent office’s review thousands of patent applications. Ensuring that each one of them meets all formal requirements is time intensive. There are certain fields where getting a patent in an accelerated manner becomes pivotal to protect all R&D efforts. E-filing online systems for filing and managing IP rights applications, implementing smart contracts to automate IP license and royalty agreements, using blockchain to secure and protect IP rights through digital authentication and tracking of IP transactions, using AI assisted IP search as well as IP enforcement and litigation and using Big Data analytics to identify and monitor IP infringements become critical legal aspects to keep in mind while considering IPR for technology businesses.
Hence, a unified institution that can ensure patents are protected legally and recognised is necessary. Only when you know the value of your patents would you be able to make use of it appropriately.
Unified Patent Court (UPC)
The Unitary Patent (UP) system will allow applicants to get uniform patent protection in 25 EU Members systems by submitting one single request to the European Patent Office (EPO) after publishing of the granted European patent. The Unified Patent Court (UPC) will comprise judges from all participating Member States of the European Union. (UPC) covers patents legally through e-filing, electronic signatures that are recognized and legally binding in the UPC, providing online access to its case management system and digital storage. These legal tech aspects aim to improve the efficiency, accessibility, and fairness of the UPC’s patent dispute resolution process.
The court was set up to decide on the infringement and validity of both Unitary Patents and all European Patents. A three-month window for intellectual property owners to opt in or opt out of their European patents was expected to start on 1 January 2023. But IT challenges delayed this and the UPC is likely to start by 1 June 2023.
Once the UPC is set up, it should have a major impact on securing Intellectual Property Rights across the EU. However, it raises the question about whether companies will risk putting their intellectual ideas into the new system? Which company will take the lead and file a case? What steps will the courts take to manage the cases filed? Can German and other European patent firms merge to bolster the UPC offerings? In the coming months, can non-practising entities journey across the Atlantic Ocean to use the UPC and will litigation funders be interested in Europe?
It is not easy to find answers to these issues but 2023 promises to see the UPC as a more active legal organisation.
Read here: How UPC can help in redefining your patent monetization strategy?
Main Advantages of Using UP
- National validation processes will not be required. A renewal fee will have to be paid to the EPO. It will also reduce the costs and time of the administration team.
- Post six-year period, no translations will be needed. During the transitional period, a complete translation of the European patent is required, however, the translation has no legal effect.
Revamp the Standard Essential Patents (SEP)
The world of standard essential patents will be revamped in 2023. It is important for businesses to constantly assess whether all the IP assets are adequately protected. A UKIPO review will take place on whether the SEP system is working as expected and how to make it run more effectively. In 2022, government reports stated that the volume of SEP litigation had risen dramatically.
In August 2022, the UK Intellectual Property Office (UKIPO) discussed whether government intervention was necessary to promote advanced forms of alternative dispute resolution (ADR), including arbitration and meditation. It would make suggestions to the government after detailed reviews and report its findings to the ministers in 2023. Any major policy interventions would be subject to further consultation and discussions.
It is obvious that there is no single solution to global concerns hence consensus is always difficult. Once the UPC comes into force it can try to make implementers agree to the advantages of the use of ADR.
SEP reform is also on the agenda in the EU in 2023. The European Commission, Managing IP is keen towards use-based licensing in the new and revised SEP framework.
In 2020, the commission had declared the launch of an Action Plan for Intellectual Property that aimed to lay down the base for creating a transparent, predictable and efficient system of SEP. However, the EU is still not provided an estimate on when the plan is to be completed. There is a need to identify IP assets in order to manage IP. This involves finding the patents, trademarks, brand names, domain names, and any other tangible and intangible assets of the company that is being investigated.
Brexit Issues for IP Practitioners
In 2023, the main Brexit-related issue for IP practitioners and Legal experts is the Retained EU Law Bill (Revocation and Reform), passed on 23 September 2022. It plans to repeal any retained EU law, covering more than 60 pieces of IP legislation, by 31 December 2023.
The government has to decide whether to repeal law, convert it into national law, or make modifications in it. Several practitioners believe that the government has underestimated the scale of this task. IP assets like copyrights and patents are only valid for a certain period of time. Hence there is a need to study the local IP laws of each directory to check the validity.
For IP practitioners, here are a few critical legal pointers to be kept in mind in Brexit space:
- Jurisdiction and governing law in IP disputes: Disputes over IP rights may now involve conflicting laws and jurisdiction between the UK and EU.
- Trademark registration and protection: The UK and EU trademark systems are no longer harmonized, requiring separate registrations in each jurisdiction.
- Copyright protection and enforcement: The UK’s copyright regime has diverged from the EU, leading to potential inconsistencies in protection and enforcement.
- Patent protection and litigation: Changes in the patent landscape may result in the need for re-examination and grant of supplementary protection certificates for pharmaceuticals.
- Data protection and privacy: The UK’s exit from the EU may affect the flow of personal data between the two territories, requiring companies to adopt alternative mechanisms for data transfer.
- Customs enforcement and IP rights: The UK’s departure from the EU customs union may create challenges in enforcing IP rights at the border, including counterfeit goods and parallel imports.
Currently, over 60 laws ranging from statutory instruments and interpretations of EU directives to direct regulations have been shortlisted for review and modifications. In the near future there could be many more that come under the review of the UK government.
There will be discussions and analysis over the existing laws that were operational for a long period of time.
Rise in Third Party Funding Trend
Practitioners expect to see more cases funded by third parties in 2023. The UPC could contribute to this trend. In 2022, litigation funders observed increased cases of funded IP. They indicated further increase once the UPC became fully operational in the EU.
Investors like Erso Capital, declared a $500 million amount exclusively for patent cases. The decision to accumulate money specifically for patent litigation was a result of the rising demand in the tech and life sciences sectors in the EU. James Blick, co-founder of Erso Capital confirmed that this money would be available to companies across the globe. Erso was keen to expand in Europe. EU displayed a gap in the market left by funders that traditionally preferred the US. The nature of, and expectations in such funded cases with third party funding is going to be a significant area to observe in 2023. The investor fund would also be used to fund legal fees and expenses and help law firms that agreed to contingency fee arrangements. These examples show that countries need to be investor ready in order to expand business and patents.
Relevance of AI
In 2023, the UK Supreme Court is set to take up around four IP cases. A significant example is the DABUS case. This case could mark the end of artificial intelligence (AI) inventorship as it relates to patent applications. The court hearing will take place in March 2023, and could change the course of patent law in the UK and in other countries.
AI deployment in Intellectual Property Rights (IPR) can be used to analyse patent applications, identify prior art, improve efficiencies and accuracy of the patent examination process. AI can be used for Trademark Infringement detection, contract analysis to improve the efficiency of legal research, IP portfolio management and legal predictive analysis to predict outcomes of legal disputes, helping parties to make informed decisions. These legal tech aspects demonstrate how AI is being used to improve the efficiency and effectiveness of the IPR process and to better protect the rights of IP owners.
Judges and legal practitioners are divided on one hand expressing sympathy for the idea of AI creators but on the other hand, also noted that the current letter of the law does not allow it.
The UKIPO wants to study and consider AI more closely, so conversations in this domain can increase. This should be seen in the context of the UK’s stated goal of becoming a “global AI superpower”. The UK government plans to enhance engagement with the legal and AI sectors, on issues of inventorship.
Businesses need to follow unified patent protocols in order to continue the path to innovation and avoid legal disputes and disturbances.
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