Innovation at McDonalds Australia

I attended an American Chamber of Commerce luncheon this week where the speaker was Andrew Gregory, CEO of McDonalds Australia.  He spoke about innovation at McDonalds Australia.

As a regular at McDonald and a regular traveller to the USA, I have always been fascinated by how much more innovative and ‘upmarket’ the McDonalds restaurants are here in Australia by comparison, so I was interested to hear his thoughts on why the local organisation has been successful with regard to image and innovation.

His message boiled down to two key points:

1. They won’t be afraid to change or try something new, if it is something their customers really want; and
2. If a decision comes down to pleasing the customer or an internal stakeholder, McDonalds will ALWAYS do what pleases the customer.

So a customer-led approach to development, and an appetite for change are the keys to their success.

by Adam Hyland

Update on a European Unitary Patent

For those clients interested in patent protection in Europe, we have included a brief update on the move forward to a unitary European patent.

A unitary European patent and unified European Patent Court have been the subject of discussion for some decades now.  A unitary European patent is a European patent to which unitary effect is given for the territory of the Member States participating in the unitary patent scheme.  The unitary patent will co-exist with national patents and with classical European patents. The intention is that all patent owners will in future be able to choose between various combinations of classical European patents and unitary patents. Currently, various national courts and authorities of the contracting states of the European Patent Convention are competent to decide on the infringement and validity of European patents.  As noted by the EPO, in practice, this gives rise to a number of difficulties when a patent owner wishes to enforce a European patent in several countries: high costs, risk of diverging decisions and lack of legal certainty.  The Agreement on the Unified Patent Court will create, when ratified by all required EU Member States, a specialised patent court ("Unified Patent Court", or UPC) with exclusive jurisdiction for litigation relating to European patents and European patents with unitary effect (unitary patents).

However, it has never been possible to obtain full agreement by all Member States.  A proposal was put forward in 2010 by the European Commission to use “enhanced cooperation” as the way forward. This meant that the Member States that did not want to be part of the resulting system could effectively opt out. Two Regulations creating the Unitary Patent and an Agreement on the Unified Patent Court and language requirements were adopted in December 2012 and came into force in January 2013.  The Unified Patent Court Agreement needs to be ratified by Member States to be effective.  Once 13 Member States, including UK, France and Germany, have ratified the Agreement, it will come into effect.  The Unified Patent Court will be set up and the first Unitary Patents can be granted, having effect in each Member State that has ratified the Agreement.   As of May 2015, Austria, Belgium, Denmark, France, Malta and Sweden have ratified the Agreement.

On 5 May 2015, the Court of Justice of the European Union (CJEU) issued two separate judgments (C‐146/13 and C‐147/13) ruling on the validity of respective regulations on the administration of the unitary patent system (Regulations 1257/2012 and 1260/2012 of the Official Journal of the European Union).  The judgments were in response to a challenge from Spain that the regulations were invalid.  Effectively, Spain’s challenge was based on an allegation of inadequate legal basis for the Regulation, that it was wrong to let the Administrative Council of the EPO set renewal fee levels and the apportionment of renewal fees between Member States, and that there would be no requirement for a Unitary Patent to be translated into Spanish. This challenge was rejected.  Thus, there are no pending judicial hurdles at this time to the introduction of the Unified Patent Court, and therefore to the Unitary Patent.  It is possible for the EPO to set the level of the fees, including the “opt out” fee for those with existing European patents and patent applications to opt out of the jurisdiction of the Unified Patent Court.  It is likely that the level of grant and renewal fees set by the EPO will have a significant influence on how many applicants choose a Unitary Patent rather than the current potential bundle of national patents that can result from the grant of a patent by the EPO. Seven more Member States – including UK and Germany – are needed to ratify the Agreement on the Unified Patent Court. According to some European Associates, a single patent covering the whole of Europe may be implemented by the end of 2016.

by Sarah Herbert

The Economic Impact of Innovation Patents

Value in Innovation Patents? 
IPAustralia has released a new report on the economic impact of innovation patents (see link below).  As noted in the Executive Summary, “the great majority of Australian SMEs and private inventors appear to gain little benefit from the system.”  Research published in the report indicates that innovation patents have “some positive effects” but standard patents are found to have a bigger positive effect on firm survival, which was the one area of significant impact. The majority of SMEs and private inventors were found to file innovation patent applications once and never again, do not receive any enforceable right, and let their patent expire early because they see its value at less than the $110-$220 cost of renewal. Overall the report concludes that “the innovation patent is not fulfilling its policy goal of providing an incentive for Australian SMEs to innovate, and the evidence shows a reduced likelihood of patenting after participating in the innovation patent system”.

The Innovation Patent system was introduced following the Review of the Petty Patent System that was completed in 1995.  It found that there was a role for ‘second-tier patents’ as an alternative and more accessible form of industrial right protection for incremental innovations.  In our experience, innovation patents have been quite valuable for many clients as enabling quick and enforceable protection of smaller inventions and for strategic use as a litigation tool.  However, the success of the innovation patent system has been limited by the fact that the cost of enforcing an innovation patent is ultimately similar to the cost of enforcing a standard patent. While most practitioners acknowledge the need for a more accessible form of IP protection for smaller invention, innovation patents are not often considered as part of an overall IP strategy. As Australia moves towards its “innovation economy”, an innovation patent (or equivalent) has a place in encouraging smaller, incremental innovations.  The form that this takes remain to be seen.    

http://www.ipaustralia.gov.au/about-us/news-media-and-events/latest-news-listing/The-economic-impact-of-innovation-patents

by Sarah Herbert

Changes Ahead for Registered Design Protection

The Advisory Council on Intellectual Property (ACIP) has recently released a report on the designs system in Australia.  ACIP includes patent and trade mark attorneys, lawyers, rights owners and academics, and seeks to provide balanced guidance on issues referred to it by the Minister.  A process of consultation with users of the system and other stakeholders took place, so the views in the report are generally well considered.

The review is timely, as the Australian Design registration system was extensively amended in 2003, in the first major shake up since 1904.  The full report can be found here:

www.acip.gov.au/pdfs/ACIP_Designs_Final_Report.pdf

There were a total of 23 recommendations.  Many deal with a suite of amendments to correct anomalies in the legislation, and simplification and improvement of a range of technical issues in the legislation.  These proposals are overwhelmingly positive for IP developers.   Below are the highlights.

Hague Agreement – Simplify International Design Filings
One significant recommendation is to look more closely at joining the Hague Agreement.  This is an international system for filing and registration of designs, which would allow for very inexpensive international design registration.  Many Asian countries and the EU are members, and the US and Japan are in the process of joining.  It would be a great plus for Australian product developers, as it would cut the costs of international protection by 50% or more.

To join would require increasing the term of Design Registration in Australian to 15 years, from the present 10.  I have co-authored submissions, on behalf of AIPPI, supportive of Australia joining the Hague agreement.

Grace Period
This is a ‘get out of jail free’ provision.  For patents, disclosures by the applicant (or derived from the applicant without consent) in the 12 months before  filing a complete application are not part of the  prior art, and cannot be cited.  This is only true for Australia and certain other countries, for example the US, Canada and Malaysia.

There is no such provision for designs. The report recommends a 6 month grace period, but that the applicant must file a declaration about their prior use when filing.  The latter is unnecessary administrative red tape. The main users of the grace period is likely to be SMEs without detailed IP knowledge, and they are unlikely to meet this requirement.

In the AIPPI submission, we proposed a 12 months grace period (to match patents) without formalities.  We will keep pushing for this when possible.

We will keep you posted once a government response is received.

by Peter Franke

Congratulations to Peter Walker & Technology Connections International Pty Ltd

Franke Hyland are delighted  to congratulate Peter Walker and his company Technology Connections International Pty Ltd on winning a Good Design Award for 2015 in the Sport and Lifestyle Product category.

Peter’s Virtual Jeff product allows for the addition of a whammy bar (vibrato control) to any type of guitar. The photo shows  Peter and renowned Australian rocker  Ian Moss playing ‘duelling’ Virtual Jeff equipped guitars at the award ceremony.

Peter Franke of Franke Hyland has had a long association with Peter Walker, and  has developed  an IP protection strategy for this highly innovative product.

https://www.youtube.com/watch?v=Fk9twEEMsJE

by Peter Franke