24 March 2008

Europe’s Patent Demise

You are a European institution, the European Central Bank, and you seek the invalidation of what has been granted as a valid right by another European institution, the European Patent Office (EPO). The last weeks we got a taste of how The Great Patent Divide, the most un-European experience in patent law, has turned into Europe's Patent Demise.

Threatened by an patent infringement claim of a US company, Document Security Systems, Inc. (DSS) the ECB seeks the invalidation in several European countries. The UK patents court (in first instance) invalidates the patent, EP 0455 750 B1 for a ‘Method of making a nonreplicable document’ on March 26, 2007. A day later the German Federal Patent Court ("BundesPatentGericht") disagrees with the UK court and finds the patent valid. By judgment of March 12, 2008 the District Court in The Hague, Netherlands, upheld the patent as valid and follows Germany. Just a few weeks earlier, on 9th January 2008, the French court ("Tribunal de Grande Instance de Paris") agreed with the UK court in first instance and distances itself from the German court and found the patent invalid.

On March 19, 2008, the UK Appeal Court affirmed the invalidity findings of its first instance colleagues. Patent dead, in the UK and France (so far, appeal in France still pending).

You still with me?

What a disgrace. What a sorry state European patent law is in. We know that Europe is lacking a European view on validity (and infringement for that matter), but how can this be explained? The view, generally held, is that UK courts are (very) critical on what comes out of the European Patent Office. Patent 0455750 should not have been granted, if it were for the UK. France, not yet known as “patent-unfriendly” has chosen the side of the UK in this case. Is this a scary sign of what is there to come? Maybe (just) an incident and no forbode of what is next (France as the next patent basher)? One begins to wonder, are the Germans more fond of what comes out of their (“own”) EPO, located in Munich? Is Holland more inclined to accept what comes out of Munich as well? Or is this all “coincidence”? We think not. We have seen this divide before (on stents: Angiotech's patent for Taxus stent revoked by UK Court of Appeal, (partially) upheld by the Dutch District Court, but then it was only for Germany & Holland versus the UK. Is France now joining the chorus of “we-know-it-all-better-than-the-EPO” ?

(see also Dennis Crouch' Patently-O blog)

9 comments:

Anonymous said...

The "test" for new matter in England is IDENTICAL to the test in the EPO. Compare the Decisions of the EPO Technical Board of Appeal (on appeal from the Exam Divn) and of the English courts. The amendment added during EPO prosecution, that English cross-examination of the patent owner's technical expert witness revealed to be "new matter", received no analysis whatsoever by the EPO Board of Appeal.

Remember that the "language of the proceedings" is (US) English and horribly unclear. The English courts were going about their painstaking work in their own language. To readers in mainland Europe, the disclosure of the app as filed was all a bit fuzzy. Best then to go bean counting. Are the individual words added to the claim in EPO prosecution to be found, verbatim, in the app as filed? If yes, probably no new matter.

Don't you think every court is just conscientiously trying to do its best, within the constraints set by its own national jurisprudence, agreeing when it can, and disagreeing only when it feels it must?

engageip said...

We do think that every court in Europe is "conscientiously trying to do its best" but how good is that when the results are such that nobody will understand nor agree with. Hoe good is a system where the EPO delivers a European system to provide for one European patent, yet when it comes to enforcement the life of the patent is dependant on the whims of 31 national judges of 31 members of the European Patent Convention? The only answer must be –like the UK Court of Appeal mentioned – that we now need more then ever one European patent court, whether its EPLA or the London Agreement, NOW!

Anonymous said...

Still not convinced. That hasn't worked for trademarks, has it? The multi-national non-chemical patent cases like Pozzoli, TAXOL stent, ECB v DSS, Bonzel and Palmaz are about very simple questions; often the hardest to answer. They are 50:50 cases, where two judges in the same jurisdiction are as likely to disagree as two different jurisdictions. The passionate arguments between patent lawyers from different jurisdictions about such cases is something that raises judicial standards all over Europe. Having 24 Technical Boards of Appeal at the EPO, all of equal rank, has in the long run improved, rather than damaged, the quality of EPO jurisprudence. Compare the national differences in Europe now, to what they were 20 years ago. We are better off these days. Once the BGH gets in line with the rest of Europe on "disclosure", by which I mean the all-important bright line between a) what's implicit in a disclosure and b)what's not implicit but is obvious to the skilled reader, then we can forge even further forward, towards yet more legal certainty.

Who would represent clients at this vital pan-European patents court. Everybody has an "agenda" no?

Anonymous said...

Unlike in European jurisprudence, the EPO has legal oversight by the Enlarged Board of Appeal, in case a (legal) divide is emerging that need to be fixed. That's what is missing in Europe. So one can agree with the "divide" between opinions in different courts, as in different judges in one jurisdiction, however the point is that we need a uniform court OR legal oversight, or better called, a European appeal court that ultimately unifies the different patent views on inventive step and novelty of a particular invention and whether the subsequent patent has been infringed. That's what need to be fixed now more than ever.

Anonymous said...

Good contribution, that. Agreed: we need a settled view on 1) novelty 2) obviousness and 3) what is the ambit of a claim. But we have all that already. 24 Technical Boards of Appeal have been at it, night and day, since 1980 and, by now, there's nothing left for the EBA to do, on those core issues. All that remains is for national Supreme Courts to bend the knee, like the English House of Lords has done already.

And, in case you cry, yes but what a claim "covers" is different from the question whether a prior disclosure lies "inside" the claim. I reply: Exactly what comes after and infringes will deprive of novelty, if it came before. Deadly simple. Nothing incompatible with 30 years of TBA jurisprudence. Nothing unfair or inequitable or incompatible with the Protocol on Art 69 EPC. Deadly legal certainty.

Gobhicks said...

I find the whole tenor of this post to be quite extraordinary.

Yes, European patent laws are supposed to have been harmonised by the EPC. Of course, we all know that some differences in practice still exist between national patent offices and the EPO, and between national courts and the boards of appeal of the EPO. Cases that end up with final court judgements are usually cases in which difficult issues need to be decided, and it should be no surprise to anyone that differences of opinion will exist between different jusrisdictions. On this general front the quite hysterical tone of the post seems to me to be completely misjudged and inappropriate.

What is even more disturbing is the implication of statements like

UK courts are (very) critical on what comes out of the European Patent Office

France, not yet known as “patent-unfriendly” has chosen the side of the UK in this case

what is next (France as the next patent basher)?

Is France now joining the chorus of “we-know-it-all-better-than-the-EPO” ?


Since when has the EPO been omniscient? Have you looked at the EPO prosecution history of this patent? The claims were substantially re-written several times before refusal by the examining division. The claims as granted were presented for the first time at the oral proceedings of the appeal, and were again a substantial re-write of the previous claims. This amendment introduced, for the first time, the idea of “overlaying the grid pattern on the original image to produce on the document a printed image which comprises the original image having a superimposed transmitted or obstructed print pattern conforming to the grid pattern and in which the print pattern normally is not discernible by the naked eye, such that the original image and the printed image appear to the naked eye to be generally the same

The appeal decision devotes a single paragraph to the admissibility of the amendments, and does not even discuss the point above, which was the basis on which the UK courts found the patent to be invalid for added subject matter.

Go to Epoline. Look at the seven different versions of the claims that preceded the oral proceedings and the claims as presented and accepted at the oral proceedings. I defy any practicing European Patent Attorney not to be amazed at (a) how little analysis was applied by the Board of Appeal to such an extensive amendment and (b) that the claim was ever granted in the first place.

If there is any “disgrace” in this case it lies with the BOA for its shoddy analysis of admissibility. Whatever conclusion they reached, an amendment of that nature demands integer-by-integer deconstruction to determine Art. 123(2) compliance. In fact, it is amazing that the BOA even entertained the introduction of such an amendment at oral proceedings.

If anyone can explain the position taken by the German and Dutch courts on the decisive point of the UK judgements then I’d be fascinated to hear it.

Laurent said...

I quite agree with "Gobhicks".
The Board of Appeal verified very quickly the admissibility of the amendments filed during the oral proceedings.
The difference is that the proceedings were "ex parte", so the admissibility was not challenged by an opponent, and that the BoA, nearly 10 years ago, had not a long time to decide on these late-filed amendements (now, following the new rules of procedures, the BoA would probably not have allowed these amendments in the proceedings).
It is quite frequent that the EPO finds amendements admissible during the examination proceedings, and finally revoke the patent during opposition proceedings because the amendments are eventually considered as contrary to Art 123(2) EPC.
What is interesting for me is that the UK and French courts applied the rule of the EPO, i.e. that the amendment should derive directly and unambiguously from the application as filed (see my blog).

Gobhicks said...

Having now had the opportunity to see the German decision (in English translation), it seems that the German court takes a very different view of the test for added subject matter from the UK courts and, I would say, from established EPO practice. There seem to be two sides to this:
1 - the level of competence of the skilled person and
2 - the extent to which the skilled person is expected to extrapolate from information in the application as filed.

The German decision discusses the earlier UK decision at Part 4.2. Here, where one would expect a reference to the “skilled person”, the decision refers to “a highly qualified expert”, and concludes that the specific subject matter defined in the claim would be “recognized … as part of an invented printing method from the description of the characteristics of an original copy (replicant copy) and additional copies that were created based on it by means of a scanning-type copying device.”

Perhaps this reflects a traditional blurring of novelty and obviousness in German thinking, but I don’t think there can be any denying that the method defined in the claim is not explicitly described in the application as filed. Whether it is even obvious in light of the content of the application as filed seems to me to be debatable (again tied up with the level of expertise and imagination of the skilled person).

But if the point at issue is the successful harmonisation of European patent practice, then I would have to say that the UK and French decisions are much more clearly in keeping with EPO practice than the German decision.

In independent claims 1, 2, 5, 8, 9, 10 and 12 of the application as filed, the same lineations that form the image have the spacing that creates the moiré effect when photocopied. Independent claim 13 relates to a method in which a genuine original document is copied such that the image lineations of the copy are dissonant relative to the image lineations of the original, such that further copying of the copy produces the telltale moiré effects.

In analysing the claim as granted, the German decision (4.1) says:
“The step of superimposing a grid pattern onto an original image to produce an image on the document according to characteristic F is included in claim 13 – which an expert approached in this case would recognize. The intent of this claim is to create a document which cannot be faithfully reproduced using a copying process. Copying an original document, including its image content, with a copying device will
provide an original copy of the document (replicant document) featuring a grid structure in the image (image lineations).”

What is the basis for saying that “image lineations” of the “original copy” comprise a “grid structure”?

The decision goes on to say:
“An expert will understand the deliberate creation of grid structures or grid patterns as listed in the claim by means of the copying process in the original’s representation as a superimposition of the grid structures or grid pattern onto the original image.”

What is the basis for this assertion?
According to the decision:
“The unambiguous and adequate disclosure of characteristic F of the claimed print method according to claim 1 of the patent in suit constitutes a result for an expert when adding the original description: The paragraph on page 7 that continues on page 8 of WO specification K13 describes how the inventor discovered the phenomenon which constitutes the basis of the invention. Copying the original of a traveler’s check with a scanning-type color copier resulted in an initial copy that no longer fully matched the original – which would not be immediately visible to an average observer. However, copies that are created from this copy clearly show recognizable errors (telltales). The encountered effect of superimposing the grid structure on the original image, including missed matching with respect to the copying device, should be used as protection against counterfeiting the document, according to page 8, lines 7 through 12. This disclosure corresponds to that which was stated in claim 13 of WO specification K13. In addition, page 8, lines 21 through 24, states that documents should generally (but not always) be created by means of a printing method.”

The actual passages referenced here do not mention a “grid”. But they do refer to “producing the note image lineations in mismatch to the scanner of a color copier”. Page 9 of the WO publication does refer to grid lines, but does so in reference to the lines that make up the image.

The claim as granted requires a grid pattern (strictly, a print pattern corresponding to a grid pattern as previously defined in the claim) to be superimposed on an original image. The best sense that I can make of the reasoning in the German decision is that the process of copying a document, by virtue of the scanning mechanism of the copier, in some sense superimposes a grid pattern on the original image in the copy produced by the copier. It is then necessary for the skilled person to recognise that fact (which is not itself explicitly stated in the application as filed), and then to further adapt that (at best, implicit) teaching for use in a print process.

“Directly and unambiguously derivable”?

Maybe I should let this go now, but to use this case as a stick to beat the British and French for being anti-EPO and/or anti-patent is a “disgrace” in itself…

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