European Union Considering Changes to IP Licensing Rules

The European Commission recently announced that it is considering new competition rules for the assessment of technology transfer agreements. The changes could impact how companies transfer and license patents, know-how and software copyrights.

Under the EU’s current technology licensing regime, a Technology Transfer Block Exemption (TTBER) creates a so-called “safe harbor” for certain agreements deemed to have no anticompetitive effects. For instance, TTBER exempts certain agreements concluded between companies that have limited market power (market share not exceeding 20% for agreements between competitors and 30% for agreements between non-competitors).

Changes to the TTBER would include provisions that lower the market share threshold for certain licensing agreements between non-competitors. In addition, passive sales restrictions between licensees, exclusive grant-back provisions, and no-challenge clauses would no longer fall under the safe harbor of the TTBER

The Commission also plans to revise its guidelines, which are used to assess whether technology transfer agreements comply with EU competition rules. Under the proposed changes, the guidelines would be amended to include new provisions on “patent pools,” i.e., multilateral patent licensing agreements, and certain settlement agreements.

With regard to patent pools, the Commission proposes to clarify that the definition of essentiality covers not only essentiality in relation to producing a particular product but also in relation to complying with a standard. The proposed changes also clarify that licensing agreements between a pool and third parties in principle fall outside the scope of the TTBER. However, the proposal would provide a comprehensive safe harbor for pools covering not only the creation of the pool but also its subsequent licensing out, provided certain conditions are satisfied.

The new draft guidelines also address concerns over “pay-for-delay” agreements. Under the proposed changes, settlement agreements involving a license may run counter to anti-competition rules where a licensee agrees, against a value transfer from the licensor, to more restrictive terms than the licensee would have accepted solely on the strength of the licensor’s technology.

How Can I Help?

Overall, the proposal reflects significant changes in the way intellectual property may be licensed in the European Union. Under several of the proposed changes, a greater percentage of licensing agreements will be subject to antitrust scrutiny. For more information about how the new rules may impact your operations, contact me for a free 30 minute consultation at nvantreeck@usip.com or call TOLL FREE at 1-855-UR IDEAS (1-855-874-3327) and ask for Norman.

– Ex astris, scientia –

I am and avid amateur astronomer and intellectual property attorney in Pasadena, California and I am a Rising Star as rated by Super Lawyers Magazine.  As a former Chief Petty Officer in the U.S. Navy, I am a proud member of the Armed Service Committee of the Los Angeles County Bar Association working to aid all active duty and veterans in our communities. Connect with me on Google +

Norman

Should China Overhaul Its Patent System?

The European Chamber of Commerce in China is calling on China to make big changes to its patent system.  The Chamber states that the current Chinese patent system hinders the country’s ability to innovate and may be detrimental to foreign companies. The group released a report recommending a total of 52 changes.

China-flag

Below is a short summary of several issues addressed in the report:

  • Patent quality. The report suggests that China’s progress in patent quality lags behind its rates of patent filings. According to the Chamber, “While patents are exploding in China and certain innovation is also admirably on the rise, this has not necessarily translated into a proportionate rise in patent quality and in some sense the strength of China’s actual innovation is over-hyped.”
  • Government targets. The report finds that patent targets imposed by the Chinese government may be hindering patent quality. It notes, “China has emphasized a range of quantitative patent targets, which while ambitious may not encourage quality let alone highest-quality patents and related innovation as efficiently and effectively as envisaged; in fact, they may actually discourage highest-quality patents and at worst may sometimes actually encourage development and filing of low-quality patents.”
  • Rules and procedures for patent application review. The report highlights a number of concerns regarding the Chinese patent process. It specifically notes the overly burdensome Confidentiality Review process for all foreign patent filings for inventions made in China’s territory. It calls on the Chinese government to limit what constitutes a solution that “relates to the security or vital interest of the State.”
  • Patent enforcement. The report emphasizes that patent rights in China are prone to abuse, stating one source that suggests that over 50% of patents in China are filed for the sole purpose of being used for retaliation and/or to first initiate litigation. “These concerns, where patents are used as first-attack and/or tit-for-tat weapons, make businesses reluctant to establish or expand operations in China, especially IP-based operations,” the report notes. Other concerns include difficult in securing preliminary injunctions, confusion regarding the country’s anti-monopoly law, and the submission of prior art.

The European Union Chamber of Commerce in China says it looks forward to a productive discussion with Chinese officials on the issues and recommendations discussed in its report.

How I Can Help

Protecting intellectual property overseas can be challenging.  As the world continues to shrink, the need for protecting your ideas and intellectual property abroad has grown.  If you or your company has foreign intellectual property issues or does business overseas, I can assist you in planning and protecting your ideas, here and around the world.   So, if you or know someone that can use my help, please contact me for a free 30 minute consultation by sending me an email or call TOLL FREE at 1-855-UR IDEAS (1-855-874-3327) and ask for Norman.

– Ex astris, scientia –

I am and avid amateur astronomer and intellectual property attorney.  As a former Chief Petty Officer in the U.S. Navy, I am a proud member of the Armed Service Committee of the Los Angeles County Bar Association working to aid all active duty and veterans in our communities.  Connect with me on Google +

Norman

Unified European Patent System Update

At the Naples Midwinter Patent Experts Conference, Professor Dr. Heinz Goddar explained that the ratification process has been deferred altogether until after the German national elections.  Until there is German (and French and British) ratification, the “Unified” system cannot come into force.


Additionally, it was reported that there is yet a possible problem with the present unified patent proposal.  The Spanish government has announced that it will bring a new challenge to the “Unified” system to the European Court of Justice in Luxembourg.

        

As I explained in an earlier post, both Spain and Italy objected to the unified patent system proposal because their languages were not part of the process (among other issues).

It seems more and more unlikely that the EU will have a unified system anytime soon.  However, I will keep you updated on any changes that occur.

How Can I Help?

If you need help to file a patent in Europe or any other country, or know someone that can use my help, please contact me for a free 30 minute consultation by sending me an email or call TOLL FREE at 1-855-UR IDEAS (1-855-874-3327) and ask for Norman.

– Ex astris, scientia –

I am and avid amateur astronomer and intellectual property attorney.  As a former Chief Petty Officer in the U.S. Navy, I am a proud member of the Armed Service Committee of the Los Angeles County Bar Association working to aid all active duty and veterans in our communities.  Connect with me on Google +

Norman

EU Votes For A Unified Patent System To Begin In 2014.

As reported on many websites, the European Parliament voted to create a unitary patent system and patent court, after discussing the idea for more than 30 years.

The proposal, which passed on a 484-164 vote, may lower the cost of getting a European patent by as much as 80 percent.

The unitary patent court will come online on January 1, 2014, or when at least thirteen member states ratify the proposal.

Much of the high cost of getting a European patent is due to translation costs. Under the new rules, writing the patent in English, German, or French will be enough to pass muster; they won’t have to be translated into the local language of every country where they take effect.

  

The language issue was a sticking point for Spain and Italy, which have said they would opt out of the new system because their languages weren’t given the same prominence.

In the new system, getting a patent may cost as little as 4,725 Euros ($6,144), as opposed to the 36,000 euros ($46,829) needed today, according to the European Commission.

In the US, the cost of getting patents varies by location, technology type, and law firm.

However, not everything seems to be  going smoothly. A spokesperson for a tech industry group that includes Google, Oracle, and IBM voiced reservations about the new system. “While the new rules may reduce the cost of filing patents, our concern is how to appeal against bad patents,” he told the New York Times.

Additionally, Germany may not ratify this particular agreement due various minor disputes.  If Germany does not ratify the proposal, it will just be another dream that could not make it.

Eventually, I think that Spain and Italy would join if the proposal passes.  Although, it seems, from many comments on the web, that they are not alone in finding that the English, German, French language requirement to be offensive.  I do understand national pride, but my understanding is that these languages were chosen based on the size of the economies (they are the largest in the EU).  Some commentators have pointed out that Spanish is more widely spoken that French.  I think the move is totally political because the French government would not ratify the agreement without one of the languages being French.

In the end, if it is ratified, I believe it will be a good system for both Europeans and foreign patent filers.

How Can I Help?

If you need help to file a patent in Europe or any other country, or know someone that can use my help, please contact me for a free 30 minute consultation by sending me an email or call TOLL FREE at 1-855-UR IDEAS (1-855-874-3327) and ask for Norman.

– Ex astris, scientia –

I am and avid amateur astronomer and intellectual property attorney.  As a former Chief Petty Officer in the U.S. Navy, I am a proud member of the Armed Service Committee of the Los Angeles County Bar Association working to aid all active duty and veterans in our communities.  Connect with me on Google +

Norman

The Impact Of EU Copyright Protection for Software On U.S. Litigation.

The European Union’s Court of Justice has repeatedly confirmed that computer software is not eligible for copyright protection.  While this is a win for many in the software industry that rely on reverse engineering, its impact on U.S. copyright litigation is unknown.

In the court’s decision in  SAS Institute Inc. v. World Programming Ltd., the court concluded that “neither the functionality of a computer program nor the programming language and the format of data files used in a computer program” are expressive enough to qualify for copyright protection.

“To accept that the functionality of a computer program can be protected by copyright would amount to making it possible to monopolise ideas, to the detriment of technological progress and industrial development,” the court said.

Oracle and Google, among others, are currently litigating several software copyright infringement claims here in the U.S.  Oracle has argued for an even broader interpretation of copyright law as it applies to software, contending that the structure, sequence, and organization of its Java APIs are copyrightable, while Google maintains that Oracle is overreaching.  As previously reported, Oracle did not fair well in the initial case and is still mulling appeals.

How Can I Help?

If you need help to protect your software here or abroad, or know someone that can use my help, please contact me for a free 30 minute consultation by sending me an email or call TOLL FREE at 1-855-UR IDEAS (1-855-874-3327) and ask for Norman.

– Ex astris, scientia –

I am and avid amateur astronomer and intellectual property attorney.  As a former Chief Petty Officer in the U.S. Navy, I am a proud member of the Armed Service Committee of the Los Angeles County Bar Association working to aid all active duty and veterans in our communities.  Connect with me on Google +

Norman