Major improvements to U.S. Patent Law passed by Congress

After many years of gestation, the U.S. House of Representatives on June 23 passed the America Invents Act. The Senate passed its own version in March 2011. While there is some minor work required to reconcile both versions, what is clear is that U.S. Patent Law is on the verge of the largest substantive changes in 60 years, and that U.S. law will be more harmonised with international norms than ever before.

First to File

The most important change from an Australian perspective is the move to a 'first to file' type system. In the rest of the world, regardless of who invented first, the first inventor to file becomes the legitimate patent owner. This is not currently the case in the U.S. At present, an inventor who files later but invents first can, subject to very stringent evidence requirements, obtain the patent rights. However, this expensive and time consuming procedure - called an interference - creates significant uncertainty for investors and the public at large.

It also creates an anomaly where in some cases one party owns the U.S. patent, after a successful interference, supplanting the owner throughout the rest of the world. Although the example of small inventors was often used to justify the first to invent principle, in fact the overwhelming beneficiaries were U.S. corporates who understood how to play this game.

The U.S. will now abolish this distinction, and operate a first to file system, in common with the rest of the world. This will, for example, make current elaborate laboratory notebook practices involving witnessing of pages unnecessary for patent law purposes.

New Review Processes

Many countries, for example  Japan, Australian and under the European Patent System, have had review procedures available to challenge a decision to grant a patent at the patent office, and benefiting from the technical expertise of the patent office examiners. These are generally known as opposition systems, and provide an alternative to challenge in the court system.  Although a limited form of this existed previously in the U.S., a more extensive version will operate as the new inter-partes review and post grant proceedings. These proceedings will be handled by the Administrative Patent Judges of the current Interference Trial Section of the USPTO. A window will operate after grant for such reviews and again after filing patent infringement litigation.

This will provide an avenue for much lower cost challenges to dubious patents.

Fees and Delays

There has been a major push, supported by business in general, to allow the patent office to keep all the fees it collects, so that the funds can be re-invested in measures to reduce the backlog of patent applications. There are (as at 27 June 2011) 703, 175 pending U.S. patent applications which have not been examined. The USPTO is a major operation, employing almost 10,000 staff and having annual revenue of about 2.1 Billion USD. Historically, this pool has been convenient one to dip into to assist the general budget issues of the U.S. Federal Government. A limited form of this measure was passed by the House, in contrast to the Senate, where the full segregation was allowed. This will have to be settled by negotiation, prior to signature by President Obama.

The process of patent reform in the U.S. has taken many years, and although this Act does not resolve all the issues, it will make a vast improvement, especially from the perspective of non-U.S. users of the U.S. patent system.

by Peter Franke

Adam at the Institute of Food Technology Convention, New Orleans - Part II

Hi again!

Here are my latest thoughts and observations from IFT11.

• A number of big names have opted not to exhibit at IFT11, including Danisco, Kerry Ingredients and FMC.
• Talking to most of the exhibitors, they feel that things are a little quiet in the expo, compared with previous years. Many are saying that they are nevertheless making a useful number of good quality contacts.
• I did discover one Australian company at end expo: Cavitus Pty Ltd., an ultrasonic processing technology development company from Sydney. I spoke to Dr Darren Bates, the CTO of Cavitus, with whom I had drafted a couple of ultrasonic processing patent applications a few years ago. You can check out what he is doing at www.cavitus.com.
• The field of functional ingredients and delivery systems is very big business for the major ingredient suppliers. Particularly so for ingredients that allow an on-pack claim. 
• The same trend is happening in pet foods, with claims for brain health, joint health, renal health, eye health being pursued (to name a few!).

Finally, did you know that McDonalds in the U.S. work with their beef suppliers to ensure they only use Temple Grandin's humane cattle handling systems? (Check out Dr Grandin's site here)

More thoughts soon!

Cheers, 

Adam

Adam at the Institute of Food Technology Convention, New Orleans - Part I

My first couple of days at the Institute of Food Technology convention (IFT11) have been great, if a little overwhelming! Over 9,000 attendees, 900 exhibiting companies - hard to know where to begin.

I will give a bit of a 'grab bag' of impressions and ideas:

• sustainability is a major theme and concern of the food industry. What exactly does it mean? It does seem to be a mix of issues including environmental concerns, public health, employee welfare and charitable works. These things have been part of corporate social responsibility (CSR) for some years. Listening to the likes of McDonald's, Wal-Mart and Coca-Cola the sustainability drive is now about pushing suppliers to adopt their CSR policies.
• A big presence of Chinese chemical and ingredient companies at the expo. While some of their marketing pitches are unsophisticated, their determination and pricing is compelling!
• No identifiable Australian presence at the conference or expo. Apart from a few expats doing great things over here - special thanks to Wayne Howard and the team at BASF for their hospitality!
• Whole grains and their health benefits seem to have a higher recognition here than in Australia. Even corn producers are getting in on the act with ' whole corn' formulation ideas being demonstrated.
• There is a debate raging between corn producers and others about the health benefits of high fructose corn syrup (HFCS), with some products now sporting 'HFCS-free' claims.

More thoughts from New Orleans tomorrow. Follow my tweets on @frankehyland

Adam

Government’s response to ACIP’s ‘Review of Post-Grant Enforcement Strategies’ report

In recent years, the Advisory Council on Intellectual Property (ACIP) has been conducting a number of reviews and issued corresponding papers on IP reform in Australia.

A report issued on 19 February 2010 by ACIP entitled Post-Grant Patent Enforcement Strategies, made a number of quite radical proposals intended to address perceived prohibitive issues of effectiveness and cost faced by SMEs when considering enforcing their granted patent rights.

On 3 June 2011, the Government issued a response to the report’s recommendations. Despite the hype, the Government’s response is quite deflating on the more radical recommendations and only the ‘soft’ recommendations have been accepted.

Of the interesting recommendations was a general push for better access to alternative dispute resolution with a patent focus. Within this framework was a recommendation that IP Australia host an IP dispute resolution centre. The Government, while condoning the use of alternative dispute resolution (ADR) mechanisms, rejected the idea that IP Australia hosts such a centre. Similarly, the proposal of the formation of a specific Patent Tribunal for patent disputes was rejected on the question of value, given that such a tribunal would be inevitably limited to issuing non-legally binding recommendations as opposed to binding decisions.

Another interesting proposal was to empower Australian Customs to seize goods which potentially infringe an Australian patent right. Australian Customs currently have such powers in regards to Australian Trade Mark and Copyright owners. Again, the Government response was to reject this proposal on practicality. The question of patent infringement is not an easy question to determine and hence, should Australian Customs be burdened with a question it is not readily equipped to answer.

While some may see the Government’s response as deflating, the reality is that the Government’s response is quite grounded from a practicality viewpoint. What will be the spin generated by this non-event?

by Simon Ellis