Here’s a brief round up of practical things to remember from recent Australian Federal Court IP decisions. (There’s no real legal analysis here, sorry – this one is for business readers, not lawyers.)
Strategic Litigation Management is Crucial. Companies should develop a clear and well-supported strategy ideally before or at least early in any litigation. Changing the way a case is pursued on appeal, such as seeking a narrower scope of registration in a trade mark dispute or presenting new evidence, can impact costs outcomes and weigh against a favourable costs order, even if ultimately successful. Somers Enterprises Australia Pty Ltd v Basefun Pty Ltd (No 2) [2025] FCA 418. Ensure pleadings adequately describe the basis for claims, as courts will assess this even in default judgment scenarios: EV20 Consulting Group Pty Ltd v Paperless Warehousing Pty Ltd (No 2) [2025] FCA 476.
Understand and Prepare for Costs Assessment. The Federal Court prefers assessing costs on a lump sum basis to avoid lengthy and expensive taxation processes. While a “broader brush” is applied in lump sum assessment, it must still be logical, fair, and reasonable, often starting with actual costs and applying discounts. Companies must provide evidence of costs incurred for assessment. Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd (No 5) [2025] FCA 505
Litigation Costs Must Be Proportionate. The Court considers whether parties conduct proceedings, including costs assessments, consistently with the overarching purpose of resolving disputes at a cost proportionate to the matters in dispute. Excessive expenditure incurred during a costs assessment itself can be taken into account when awarding costs related to that assessment. This means parties should avoid incurring disproportionate costs disputing quantum. Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd (No 5) [2025] FCA 505
Impecuniosity is Not an Automatic Shield Against Security for Costs. If a company is impecunious and argues that an order for security for costs would “stultify” (stop) the litigation, the mere existence of that impecuniosity is not sufficient proof. The company bears the burden of proving that the proceedings will not continue and must prove, with cogent evidence, that other potential sources of funding are also unavailable. The Advanced Technology Group Pty Ltd v Foxtel Cable Television Pty Ltd [2025] FCA 408
Funding Sources Beyond the Plaintiff Company Will Be Considered. When assessing stultification, courts will consider the financial position of those who stand behind the company and stand to benefit from the litigation, such as shareholders or beneficiaries. It is the plaintiff’s obligation to show that these parties are also without means. The extent of benefit and influence over the litigation are relevant factors in determining if it is reasonable to expect these parties to provide security. This may include exploring whether financing can be raised against the company’s assets, including intangible ones, or related entities. The Advanced Technology Group Pty Ltd v Foxtel Cable Television Pty Ltd [2025] FCA 408
Trade Mark Use Requires Diligence. Companies should actively use their registered trade marks to avoid non-use removal actions. Be prepared to provide evidence of good faith use. Defending an overly broad registration before a delegate or the Court, and then narrowing it on appeal, can be a factor against recovering costs incurred in defending the broader scope. Maintaining the integrity of the Trade Marks Register is a public interest concern, and removal provisions are designed to ensure it accurately reflects marks in use. Somers Enterprises Australia Pty Ltd v Basefun Pty Ltd (No 2) [2025] FCA 418. and Village Roadshow IP Pty Ltd v VUR Village Trading No 1 Limited [2025] FCA 428
Logical approach to costs reports. Courts expect legal principles, such as the allocation of costs between claims and cross-claims under the Smith v Madden principle, to be correctly applied, even in simplified processes like lump sum assessments. Referee reports on quantum of costs are likely to be adopted if they demonstrate a thorough and logical approach based on applicable principles and evidence. Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd (No 5) [2025] FCA 505
(The first draft of this post was created with help from NotebookLM.)
Artificial intelligence (AI) is impacting many facets of intellectual property law and practice. We have to keep in mind both the challenges AI presents and the opportunities it creates for innovators and legal professionals.
Copyright and AI:
The US Copyright Office has released reports examining the intersection of AI and copyright law. Their Part 2 report indicated that questions of copyright protection of AI outputs can generally be resolved under existing law. It clarified that copyright protects the original expression by a human author, even when using AI tools, but does not extend to purely AI-generated material or material with insufficient human control. The report did not find a basis for additional copyright or sui generis protection for AI-generated content.
More recently, the US Copyright Office’s Part 3: Generative AI Training report concluded that many current industry practices for AI training probably do not qualify as fair use. This report, released in pre-publication form, suggests that uploading entire copyrighted works for training is prima facie infringement unless licensed or excused by fair use. This has intensified and politicized the debate over compensating creators for AI training data. The recent turmoil at the US Copyright Office, including the firing of the Director of the Copyright Office, has occurred alongside these reports and raises questions about the future approach to AI, although the report is expected to remain influential.
Understanding copyright risks related to generative AI is increasingly critical for businesses. For example, Warner Music Group sued DSW for using copyrighted songs in social media ads without permission, potentially leading to significant damages.
Legislative bodies are considering the impact of AI on copyright. The Hong Kong government consulted on potential revisions to its Copyright Ordinance in view of generative AI developments. In the UK, the Copyright Licensing Agency is developing a Generative AI Training Licence, and UK artists have urged Parliament to protect copyright and require AI companies to disclose copyrighted works used for training.
Courts are grappling with AI-related copyright issues. In India, the Delhi High Court is poised to rule on the lawfulness of Text and Data Mining (TDM) for machine learning, considering whether human learning equates to machine learning. Chinese courts have seen an increase in AI-related disputes, including a ruling on AI voice infringement. While one Beijing Court ruling upheld copyright for an AI work with human originality, a more recent source indicates a China court has ruled for the first time that AI-generated content is not capable of copyright protection.
There are ongoing discussions about collective agreements on AI in film and TV production and concerns about unfair licensing practices for digital resources potentially used for TDM by libraries.
Patents and AI:
The patentability of AI-related inventions remains a key issue. The Federal Circuit’s Recentive Analytics v. Fox Corp. decision was the first to explicitly address patent eligibility in the context of AI use. While seemingly challenging for AI patents, strategies for successful drafting and prosecution still exist despite increased USPTO scrutiny. The Patent Trial and Appeal Board (PTAB) has also denied patents for AI-based medical tools based on eligibility, rather than novelty.
AI is increasingly being explored and implemented in patent practice. There are AI tools for improving invention harvesting and drafting which are critical tasks both for in-house counsel and external advisors. Companies are developing and offering AI-powered tools for various patent workflows, including ideation, patentability evaluation, search, and analytics. Examples include IP.com’s IQ Ideas+ and InnovationQ+, Clarivate’s patent intelligence solutions and Unified Patents’ AI landscape and claim charting tools. The use of responsible AI for patent drafting by law firms is also a key issue.
Discussions around AI are prompting broader questions about the patent system. Influential figures such as Jack Dorsey and Elon Musk have questioned the need for IP law in the age of AI. The AIPLA has highlighted concerns about patent eligibility and AI/IP to the US administration. The Japan Patent Office has issued examination guidance on AI-related technologies. China holds a significant percentage of granted generative AI patents, and Chinese companies are focusing on commercialising their patent assets.
Trademarks and AI:
The emerging area of AI-generated trademarks presents challenges regarding legal ownership of newly created brands (although this may be better characterised as a copyright issue in many jurisdictions).
AI is seen as a tool that can both create brand protection issues and help combat fakes and brand impersonation. Companies like Red Points and Corsearch offer brand protection solutions utilizing AI.
The use of AI by trademark practitioners and IP offices is being explored. An amended Trademark Law is reportedly in the works in China.
Trade Secrets and AI:
Generative AI introduces risks of unintentional disclosure of trade secrets. We should expect that courts are likely to protect trade secret owners against new methods of theft facilitated by technology, including generative AI. However, it does require additional diligence to ensure that trade secrets don’t inadvertently end up in a large language models and thereafter slip out again. UK businesses using generative AI need to implement “reasonable steps,” such as robust access controls, to comply with trade secret laws and mitigate disclosure risks.
New contractual safeguards such as AI circuit breakers are being considered in IT contracts for AI systems to prevent undesirable behavior that could lead to harm or disclosure. Recent trade secret litigation has demonstrated the significant remedies available for misappropriation, particularly involving former employees and competitors.
The intersection of AI and IP is continuing to evolve at a frenetic pace, with significant legal and practical implications unfolding rapidly across copyright (especially regarding training data and authorship), patents (for AI inventions and in prosecution tools), trademarks (in protection and generation), and trade secrets (in risks and safeguards). Policy discussions and legislative initiatives are underway in various jurisdictions to attempt to address these challenges and opportunities.
(The first draft of this post was created with help from NotebookLM.)
Another Repatha instalment, this time the UPC (Unified Patents Court) in Europe issued it’s first decision on infringement of second medical use claims. Regeneron’s EP 3536712 patent (licensed to Sanofi) found valid but not infringed by Repatha under a two stage test set out by the court: Judgment; Pincent Masons; Life Sciences Intellectual Property Review; Patent Lawyer Magazine; IPKat;
Apple’s win reversed in patent infringement case brought by Fintiv – Summary Judgment overruled by US Court of Appeals for the Federal Circuit (CAFC). It appears that Apple Wallet may well have a widget after all. (Back to the District Court to determine infringement.): IPWatchDog; ip fray; Bloomberg;
Epic Games Fortnite virtual concerts by Travis Scott and Ariana Grande held not to infringe patents after prolonged dispute: Music Business Worldwide; Business; Law360
India and the United Kingdom announce a new Free Trade Agreement to much applause from industry: Business News; Pharmacy Business; JDSupra; Mayer Brown; BW Businesswire;
Actual copying is a key part of copyright infringement – using a similar style for a photo won’t cut it. US Court of Appeals for the Ninth Circuit rules against Woodland in Lil Nas instagram photo pose lawsuit: Technology & Marketing Law Blog; Billboard; Rolling Stone; Law360
“‘The technology is moving so fast and we’re so small, we don’t need a patent, we just need to move fast.”
Wrong.
Every small tech company is going to want to deal with a larger company sooner or later. You need to be fully prepared for that interaction well ahead of time.
Competition can come from any direction these days, every large company is building their own tech to improve their business.
Typically the small tech company builds something exciting then goes out to get interest from larger companies. Eventually they get one or two to sign an NDA and show them how it works. If they’re lucky they can run a trial at a larger company to test the tech in real life.
If the small company hasn’t filed their own patents well in advance, they could be in a world of pain.
This is what happened when Zest Labs asked Walmart to test their fresh produce tracking technology. Walmart trialed it, and decided instead focus their efforts on their own in-house development.
This is very common.
Millions of dollars in legal fees later, Zest received a US $222.7 million verdict which included US $150 m in punitive damages (due to Walmart’s conduct). This was actually a retrial because the original damages award of US $110m did not take into account the allegation that Walmart had been filing their own patents based on Zest’s technology.
If Zest had filed the relevant patents ahead of time, Walmart’s patents would be invalid, they could have added patent infringement to the lawsuit and likely received even higher damages. As it is, there may be a way to have the Walmart patents transferred to Zest, but that’s another fight. (Don’t get me wrong, Zest have an impressive patent portfolio, but it wasn’t brought to bear in this case.)
Zest Labs, Inc. et al. v. Wal-Mart Inc., U.S. District Court, Eastern District of Arkansas, Case No. 4:18-cv-00500-JM
In fairly big news for patent litigants in the US, the Federal Circuit recently clarified that you can rely on prior art in the patent litigation, even if you have relied on previously in an Inter Partes Review (IPR). The proviso is that you can only do so to support a ground of invalidity that is not available in an IPR.
This is big news because previously there were split decisions as to whether you were stopped (Estopped) from using the same prior art at all. In Judge Hughes’ words:
“IPR estoppel does not preclude a petitioner from relying on the same patents and printed publications as evidence in asserting a ground that could not be raised during the IPR, such as that the claimed invention was known or used by others, on sale, or in public use.”
Typical grounds where prior art may be reused could include prior public use or sale.
The case is: Ingenico Inc. v. IOENGINE, LLC, No. 23-1367 (Fed. Cir. May 7, 2025)
Here’s some great commentary at: PatentlyO, JDSupra, A&O Shearman, IPWatchDog,
US Copyright Office released a controversial report on AI impact on copyright and then one day later Trump fired the Director, Shira Perlmutter. A key finding of the report was that AI companies using copyrighted materials to train their models may not be protected by the fair use legal doctrine.
Here’s a copy of the report. And some commentary by: Futurism, CMU, Jenner & Block, Mashable, The Hill,
UK House of Lords refuses UK government copyright and AI law instead requiring data companies to disclose which copyrighted material they have used. Read more at: The Guardian, Techmeme, Billboard, The Telegraph, Engadget,
The US Federal Circuit has reduced the scope of Estoppel allowing the same prior art to be used in IPR proceedings as well as later district court cases, provided they are pleaded under different grounds. Read more at: PatentlyO, IPWatchDog, Dentons, JDSupra,
The global dispute between Amgen and Sanofi over patent claims to Amgen’s drug Repatha® (evoloumab) saw another chapter close on 24 April. In this installment, the Australian Federal Court dismissed Sanofi’s appeal and upheld the claims. Given the nature of the dispute, it seems almost certain to be appealed.
Here’s the judgment and some good commentary here and here.
Here are a few useful statements from Nicholas J’s judgment:
In relation to whether the claims define the invention (at 218):
“What is essential is that the PSA (Person Skilled in the Art) be able to determine whether a particular MAb (Monoclonal Antibody) is within or outside the claims. In this regard, it is important not to conflate the requirement that the claims define the invention with the requirement that the CS (specification) describe the invention fully (i.e. sufficiency) arising under s 40(2)(a) of the Act before amendment by the RTB (Raising the Bar) Act.”
As to whether the claims should be held invalid due to lack of manner of manufacture because they have a ‘chilling effect’ (at 247-248):
“In the present case, the Exemplary Claims are, in substance, to MAbs that block or inhibit the binding of PCSK9 to LDLR. The focus of the claims is on the effect that the MAbs of the claims have on the interaction of those molecules. That is not a focus on the genetic information conveyed by the MAbs. I do not consider the Exemplary Claims to be a new class of claim involving a significant new application or extension of the concept of manner of manufacture. It follows that there is no need to consider factors 3-6 set out by the plurality in [28] of Myriad, including whether allowing a claim will have a “chilling effect”.
In any case, Sanofi’s contention that the Exemplary Claims would, if allowed, have a chilling effect is by no means self-evident, and is not supported by the evidence.”
As to whether the claims were fairly based on the matter disclosed in the specification (at 318):
“Sanofi’s comparison between the exemplified antibodies and the potential total number of antibodies falling within the class (i.e., “hundreds, if not thousands or many more”) does not assist it once it is accepted that the invention described is not limited to 21B12, 31H4 and 16F12. While this kind of analysis might well be relevant to the support requirement now found in s 40(3) of the Act, it has no role to play in assessing fair basis.”
Trending in intellectual property at the moment:
Apple ordered to pay US $502m plus compound interest to non practicing entity Optis in FRAND patent infringement appeal to UK Court of Appeal. : Judgment; Apple World Today; Reuters; Engadget; IPWatchDog;
U.S. Trade Representative Releases 2025 Special 301 Report on Intellectual Property Protection and Enforcement. Special watch list now includes: Argentina, China, Chile, India, Indonesia, Mexico, Russia and Venezuela.; China IP Law Update; Business News Today;
Ongoing debate and concern over UK changes to copyright law to deal with Artificial Intelligence: Music Business; Music Business Worldwide; The Guardian; AI UK; Daily Mail;
Judge in Meta AI Copyright case and warns AI could obliterate markets for original works: CNA: Reuters; Tech in Asia; Ars Technica; MSN; Wired; Financial Times; Bloomberg;
Here’s a quick update on recent and important IP issues.
You still need to clear the way in UK pharma patent cases. Loss of first mover advantage still holds great weight. Astrazeneca wins interim injunction against Glenmark in Dapagliflozin case. Read more at: Bristows; Hogan Lovells; JUVE Patent; NIPC Law; Lexology.
The US Federal Circuit confirmed standards for patentability of Artificial Intelligence (AI) inventions. You definitely need concrete technical improvements. Read more at: Lowenstein Sandler; IPWatchDog; Patently-O; Lathrop GPM; BlawgIT; PatentDocs.
Top Gun: Maverick copyright infringement case brought against Paramount with claim of co-authorship. Read more at: AV Club; The Hollywood Reporter; People.
A collective copyright licence for generative AI training may be the answer. Read more at: The National Law Review; Digital Music News; The Register; The Express Tribune;
How can you use intellectual property to attract a high valuation and strong investment? Here are a some things to think about:
- A solid, ongoing patenting program. Questions (and possibly eyebrows) likely to be raised if your most recent patent was filed several years ago. It looks much more attractive if you have a steady stream of well-crafted patent applications. These applications should clearly be the product of a well thought out patent strategy. This strategy should sit alongside your product development road map. There are plenty of ways to do this without breaking the bank.
- Trade Marks registered (or at least filed) for your main brand(s). Make sure they have specifications of appropriate breadth to cover your goods without a risk of Non-Use attack.
- Registered Designs covering key design features of any physical products, again with well-crafted specifications.
- Processes in place to manage copyright and trade secrets.
- Supporting documentation that is organised and actively managed (everything from contracts to registration certificates, and beyond).
- Consider filing for IP protection (particularly patents) in countries where (1) you have a market, (2) you are planning to build a market, and (3) you or your competitors have supply chain components (manufacture / logistics etc).
To supercharge all of this, fully integrate your IP efforts into your business. So for example, add regulatory, contractual, and other protections to your product or service offerings. Have a good process for scanning and capturing insights. These insights might become valuable IP in the future.
You must be logged in to post a comment.