Australia's innovation review – an IP joke
I’ve now been asked by several journalists from top international intellectual property publications to comment on the intellectual property recommendations in the Australian government’s recent Innovation review.
In short, I think they’re poorly thought out. Here’s what I think – what do you think?
Recommendation 7.2: Patent law should be reviewed to ensure that the inventive steps required to qualify for patents are considerable, and that the resulting patents are well defined, so as to minimise litigation and maximise the scope for subsequent innovators.
‘the inventive steps required to qualify for patents are considerable’ – this is a phrase written by someone who has no understanding of inventive step or patentability.
What does ‘considerable’ mean? Exactly how do they propose to define this in a way that will be flexible into the future. The whole point about the common law (ie case law, not codified) legal systems is to allow judges the flexibility to interpret the law and allow it to move with the times. They seem to want to codify ‘considerable inventive steps’ whatever that means(?)
Even if they can do this – this will not minimise litigation. The threshold for patentability (and inventive step – if that is what they mean) does not drive litigation frequency or litigation extent (ie how far any given proceedings extends). So changing this will not ‘minimise litigation’. There will always be incentives to enforce patents and to defend with an invalidity cross claim. If they mean that this new higher requirement will in some way decrease the number of patents and thereby decrease the amount of litigation, then they have little understanding of the statistics about this. This will reduce the instance of low quality patents – but these are very rarely the ones being litigated in any event. Etc.
‘and that the resulting patents are well defined’ – fine, a good idea.
What does ‘maximise the scope for subsequent innovators’ mean? Maximise the scope of what? I presume it means freedom to operate. Freedom to operate is not going to be affected in reality by low quality patents as they are quickly seen through.
The theory here is that by tightening what you can claim based on the written description, you narrow the scope of the ‘thicket’ of patent claims out there and so make it easier for subsequent innovators to manoeuvre. The reality is that broad claims will still be granted in any event because the patent office is not going to be able to police them to the extent that a court would. So, the primary stated objective (of removing uncertainty over patent infringement) would not be met in any event.
Perhaps ‘maximise the scope’ means the scope of patentable subject matter. This would make sense if ‘the resulting patents are well defined’ refers to fair basis (ie sufficiency (EP) / written description (US)). However, the text of the relevant section only refers to freedom to operate and a ‘patent thicket’. Even if it was an attempt to allow subsequent innovators the ability to obtain patents (notwithstanding that it is at odds with the other recommendations), it wouldn’t work, because tightening the fair basis rules would only narrow the claims that the patentee can obtain, and will not impact on the amount of irrelevant, crystal ball gazing that he or she puts in the specification (which affects patentability of future applications).
Recommendation 7.3: Professional practitioners and beneficiaries of the IP system should be closely involved in IP policy making. However IP policy is economic policy. It should make the same transition as competition policy did in the 1980s and 90s to being managed as such.
Recommendation 7.4: Firms asserting or defending intellectual property should have a right to opt out of ‘appellate double jeopardy’
I love this one.
As I understand it, this would involve a change to the Court Rules to allow either party to opt out of appealing from the decision and in so doing, bind the other to paying all of its costs should it appeal the first instance decision.
This is supposedly aiming at driving down litigation costs. Assuming that the constitutional and procedural hurdles (in both the Federal Court and all of the relevant State and Territorial Courts) could be surmounted to get this through (not to mention the uproar from the legal profession), it won’t have much impact at all on the cost of litigation because most cases are not appealed and very few litigants, having spent the enormous sums to get through a first instance trial are going to be happy to waive their right to an appeal so that they can save a sum which is quite small in comparison to what they have just spent.