global ip considerations for a shifting environment€¦ · •may be more expensive review global...

© 2020 Armstrong Teasdale LLP © 2020 Armstrong Teasdale LLP

Global IP Considerations For a Shifting Environment

Courtney Jackson, Armstrong Teasdale LLP

Michael Gnibus, Armstrong Teasdale LLP

Zane Shihab, Kerman & Co.

© 2020 Armstrong Teasdale LLP

Global Patent Portfolio Consistency


Global Claim Consistency – Why is it Important?

Brief Introduction to Patents

• Prevent others from making, using, selling what is ‘claimed’ (protected by the patent)

• Claims are word descriptions of the invention

• One word can significantly impact scope of protection

Global Claim Consistency = the same/substantially the same claim scope in related discrete global patent assets.

• A + B + C in U.S. patent and A + B + C in EP-granted patent and EP national

More accurately and simply define the scope of global coverage for a technology

Strengthens portfolio


Global Claim Consistency – Why is it Important? (continued)

In light of ‘Narrower Patents’ – Scope of broader claims too broad?

Enables licensing/joint development opportunities

Sound process that is followed = likelihood of success

• Before: Know where in the world the application will be filed

• Conduct global review of prior art

• Global review before filing

• Develop a global claim set

• Stay engaged during pendency – and connect globally


Awareness of Global Patent Rules

The person entrusted with developing the patent portion of the IP portfolio must be familiar with the rules of patent prosecution in the jurisdictions of strategic importance to the company.

Deep global expertise is not required.

Working knowledge of local rules of practice that will impact claim protection should be appreciated.

• Be able to “issue spot.”

The ability to draft patent claims and associated patent specifications with the discrete country-specific global rules of patent practice in mind will streamline prosecution and enhance your company’s ability to achieve claim consistency.


Awareness of Global Patent Rules (continued)

Examples of rules to keep in mind while drafting include:

• European Patent Office’s (EPO) limitation of one independent claim per statutory category.

A U.S. practitioner who is able to prosecute multiple independent claims per statutory category.

• Avoid “patent profanity” (e.g. necessary, must, always, required, invention, etc.)

• Chinese National Intellectual Property Administration (CNIPA) or Chinese Patent Office’s strict requirement of antecedent support between claim elements and the recitation of the claim element in the specification.

Practice Tip: In countries or regions of interest to your company, schedule short, focused learning sessions with experienced outside or local counsel to learn local IP basics and best global drafting and prosecution practices to enhance your ability to build quality global patent portfolios.


Actively Manage Translations

We have heard the phrases:

• “Something lost in the translation”

• “You get what you pay for”

Align with a translation agent who possesses the technical knowledge and expertise.

• Technical depth + expertise = translation technical accuracy

• May be more expensive

Review global claim sets – should be reviewed regularly during their pendency.

One approach to conducting this review is to globally apply priority (first filing) claim sets against claim sets in non-priority countries.


Actively Manage Translations (continued)

The same language claim sets are compared.

• e.g. English-language priority application pending claim set, as amended, would be compared to an English-language version of a Japanese claim set filed in Japan.

The comparison services could be made by the translation agent.

• No additional formal translations. Required.

• Review whenever claims are being amended in a global patent family in response to an official action or before issue fees are paid.

Practice Tip: Formally docket, then review claims when a triggering event occurs (e.g. filing application, official action, allowance, EP validation, etc.).


Use of Patent Cooperation Treaty Applications

The Patent Cooperation Treaty (PCT) is the international treaty that defines the patent rights granted between the Treaty’s contracting states.

• Most industrialized nations are signatories to the PCT.

• The PCT patent application is a single application filed at one of the international receiving offices.

• The applicant retains the right to file future national patent applications in any of the PCT countries.

• The application does not issue as a “PCT patent.”

• The application is reviewed by a PCT examiner.

• At the end of the “PCT phase,” the applicant can make corresponding national filings in one or more contracting states.


Use of Patent Cooperation Treaty Applications (continued) During the PCT phase:

• The searching authority issues a search report with an assessment of the patentability of the claims as filed.

• Depending on the assertions made in the search report, the applicant may choose to amend the claims.

When the national applications are filed, the amended PCT claims would be included in each of the national filings.

• The national filings would all have claims comprising the same scope.

• National patent examiners are not obligated to follow the PCT prosecution.

The PCT prosecution history can be persuasive and serve as a means for expediting allowance of corresponding national applications, frequently without the need to amend filed claims.

Practice Tip: By Using PCT single application and examination process, significantly limit potential variability of claims – save €, £, $.


Global Software Protection


Patent Protection for Software

Most countries place some limits on the patenting of inventions involving software.

• U.S. patent law excludes “abstract ideas.”

• Europe, “computer programs as such” are excluded from patentability.

Substantive law regarding the patentability of software and computer-implemented inventions is different under different jurisdictions.


Software – Related Inventions

EP – No, must have technical effect

Germany – No

U.S. – Yes

Japan – Yes

China – Yes

And the “Yes” has limitations….


U.S. Example: Recent changes to software patent eligibility

In Alice Corp. v. CLS Bank International, 573 U. S. __ (2014), the Supreme Court rejected the test for patentability of software that had been previously been in place at the United States Patent and Trademark Office.

Instead, the Court applied a two-part framework:

• First step: identify whether the patent claims are directed to a patent-ineligible concept, such as laws of nature, natural phenomena and abstract ideas.

• Second step: consider the elements of each claim both individually and “as an ordered combination” to determine whether the additional elements “transform the nature of the claim” into a patent-eligible application of the concept.


First Step: Is the software claim directed to an abstract idea?

Examples of abstract ideas:

• Fundamental economic practices, such as management of invoices, contractual relationships, or risk mitigation.

• Methods of organizing human activities, such as managing transactions between people, managing human mental activity, or advertising/marketing/sales activities.

• An idea of itself, such as (i) using categories to organize, store and transmit information, or (ii) comparing new and stored information and using rules to identify options.

• Mathematical relationships or formulae.


Second Step: If so, does the claim amount to “significantly more” than the abstract idea?

Examples of claims that amount to “significantly more”:

• Recites more than the performance of some business practice known from the pre-Internet world, along with the requirement to perform it using the Internet.

• Applies a solution necessarily rooted in computer technology in order to solve a problem specifically arising in some aspect of computer technology.

• Improves the functioning of the claimed computer itself, such as by enabling the computer to achieve faster computation and/or use less memory without sacrificing the quality of the result.

• Improves the functioning, or control, of a specific system or device in another technical field.


What remains the same

No changes to:

• Step 1 (statutory categories)

• Streamlined analysis

• Step 2B

17

February 26-28, 2019


What has changed: Revised Step 2A

2019 PEG revises Step 2A:

• Creates new two-prong inquiry for determining whether a claim is “directed to” an exception

• Groups abstract ideas

18 February 26-28, 2019


MPEP flowchart including revised Step 2A

MPEP flowchart

Revised

Step 2A

flowchart

19 February 26-28, 2019


What has changed: Revised Step 2A

This flowchart depicts revised Step 2A.

Under this new two-prong inquiry, a claim is now eligible at revised Step 2A unless it:

• Recites a judicial exception and

• The exception is not integrated into a practical application of the exception.

20 February 26-28, 2019


Recent favorable Federal Circuit cases in computer-related patent eligibility

Enfish LLC v. Microsoft (May 2016). A claim to a specific database memory architecture is not directed to an abstract idea, and the assertion that the claim embodies the abstract idea of “storing, organizing, and retrieving memory in a logical table” is too high of a level of abstraction. Importantly, the invention’s ability to run on a general-purpose computer and its lack of reference to “physical” components does not render the claim ineligible.

BASCOM Global Internet Servs. v. AT&T Mobility (June 2016). A claim to a method of filtering content retrieved from the Internet is directed to an abstract idea, but adds “significantly more” by requiring the installation of the filtering tool “at a specific location, remote from the end-users, with customizable filtering features specific to each end user.”


Software Patents – Unique Challenges

Subject-matter eligibility is complex

Inventors should be heavily involved in discussions on strategies for patenting software and finding subject-matter eligible patents

While it is important to describe the subject matter in a way that ensures subject-matter eligibility, obtaining patents that provide useful rights against competitors is still the primary goal


Practice Tips

Stay Updated – The law, interpretation and rules of examination and application of both are fluid (global awareness)

More than “automating” a manual process

Structure and technical effect in claims

Multiple applications with different scope claims

• Machine, method, etc.

Discuss with colleagues, etc.


Bankruptcy and Intellectual Property


Bankruptcy and IP

IP – patents, trademarks, copyrights, trade secrets are assets

• May be owned by individual, corporation, holding company

• Ownership may be assigned

• Can have multiple owners (joint inventors)

In U.S., assets sold by a bankrupt company via a “363 Sale”

• Debtor markets assets for purchase

• Select highest bid

• Approval of sale by bankruptcy court

• Competitive bid process to maximize value

Practice Tip:

• Ownership with client?

• Annuities/maintenance fees current ?

• Make a valuation of IP assets – what is market value?


IP Considerations in M&A Transactions


IP Considerations in M&A Transactions

IP as a Driver in Deals

Key Considerations

• Type of Transaction

Asset purchase

Stock sale

Bankruptcy

• The Completeness of the Portfolio

Conduct ownership searches

Conduct audit of Target’s website / marketing materials

Consult with foreign counsel, if necessary

Review upcoming deadlines and recent filings for errors

• Strength of the House Mark

Conduct a Comprehensive Search

• Chain of Title / Ownership Issues

Assignment recordals or corrective assignments

Release of security interests


IP Considerations in M&A Transactions (continued)

• Non-Traditional IP

IT / software

Customs recordals

Domain names

Website T&Cs and Privacy Policy

Social media accounts

Marketing collateral

• Litigation and Disputes

C&D’s

TTAB & PTAB proceedings

UDRP proceedings

Court filings & decisions

Settlement, consent, and coexistence agreements



• IP Agreements and IP Provisions in Contracts

Change of control

Reps and Warranties

Exclusivity / Non-compete

Ownership of IP (NDA’s or joint development agreements)

• Industry-Specific Considerations

Media / Entertainment

• Duration of copyright protection

• Ownership of characters, film, photographs, scripts

Software

• Ownership of prior versions of programs

Biotech / Pharma

• Pending FDA approvals

• Ownership of patents / assignment of rights in employment agreements



• Post-Closing Checklist

Record security interest releases and assignments with appropriate government agencies

Update ownership with domain name registrars and Customs bureaus

Create new passwords for social media accounts

Alert foreign counsel


U.S. Trademark Use Requirements


U.S. Trademark Use Requirements

New USPTO rule requiring a U.S.-barred attorney to be listed on all filings

• Announced July 2, 2019; effective Aug. 3, 2019

• “…require applicants, registrants, or parties to a trademark proceeding whose domicile is not located within the United States (U.S.) or its territories (hereafter foreign applicants, registrants, or parties) to be represented by an attorney who is an active member in good standing of the bar of the highest court of a state in the U.S. (including the District of Columbia or any Commonwealth or territory of the U.S.).”

Source: https://www.federalregister.gov/documents/2019/07/02/2019-14087/requirement-of-us-licensed-attorney-for-foreign-trademark-applicants-and-registrants


U.S. Trademark Use Requirements (continued)

Applications based on Sections 1(a) and 1(b) of the Trademark Act will not register unless and until sufficient evidence of use is submitted and accepted.

Applications with 1(a) Filing Basis – Use

• Must be using the mark in connection with all of the goods and/or services listed in the application as of the filing date of the Application.

Applications with 1(b) Filing Basis – Intent to Use

• Must be using the mark in connection with all of the goods and/or services listed in the application as of the date of first use listed in the Statement of Use.

Applications with 44(d), 44(e), or 66(a) Filing Basis – Foreign Apps / Regs or Madrid Protocol

• No proof of use required until maintenance filings are due.

Note: While you must be using all of the goods / services listed in your application, you don’t necessarily need to show such use, unless challenged by a third party or audited by the USPTO. Rather, you only need to show sufficient use of one good or service listed in each class.



Specimens for GOODS must show current use of the mark “affixed” to the goods as they are sold or transported in commerce

• Photo of the mark on the goods themselves

• Photo of product packaging / labels

• Point-of-Sale displays In-store displays

E-commerce websites – requires (1) mark; (2) photo, image, or description of goods in close proximity to mark; and (3) a clear indication that the goods can be purchased through the website (e.g., “Buy” or “Add to Cart” button)

• Instruction manuals and other informational inserts that always accompany goods at time of purchase

• Rejected Specimens: Websites (with no ability to purchase) or other advertisements for goods

Printer proofs or artist’s renderings of packaging / labels



Specimens for SERVICES must show current use of the mark near a brief description of the services as they are offered in commerce

• Advertisements

• Marketing pieces

• Informational websites

Best practice to include contact information

Trademark owner must actually be offering and able to provide the services


Brexit – The Impact on Intellectual Property Rights Across the UK

and EU


Introduction

Trade Marks

Design Rights

Copyright

Domain Names


Timeline

On 31 January 2020, the UK formally left the EU and the European Union (Withdrawal) Act 2018 was implemented (“Exit Day”).

Withdrawal Agreement allowed for a ‘transition period’ for UK to leave, ending on 31 December 2020 (“IP Completion Day”).

Majority of EU law still applies in the UK during the transition period. Post-Brexit changes will take effect on 1 January 2021. This includes prospective changes to Intellectual Property law in the UK.


Trade Marks (Registered)

EUTMs and EU(IR) designations which are ‘registered’ or ‘protected’ before 31 December will be automatically cloned into the UK national trade mark register, creating a ‘comparable (UK) right’.

The identical mark will be independent of EUTM, but maintain the same filing/priority/seniority dates. Separate renewal date – keep an eye!

Take care when conducting clearance searches for a new UK application 1-2 months before 31 December – watch out for registered EUTMs and EUTMs within six-month grace period.

‘Opting out’ of having comparable rights in the UK is possible after 1 January 2021.


Trade Marks (Pending)

EUTM applications that are “pending” on 31 December 2020 will not be automatically cloned.

There will be a nine-month period immediately following 31 December 2020 in which a proprietor can claim priority from an EUTM for a new UK trade mark application (regardless of whether that EUTM is the first filing of the mark).

Same rules apply to international applications designating EU.

Considering making an EU application? It is advised to make it before end of August/beginning of September in order to achieve registration in time.


Trade Marks – Oppositions

Based on either:

i) absolute grounds – lack of distinctive character/bad faith; or

ii) relative grounds – earlier rights (identical/similar marks, unfair disadvantage).

THESE GROUNDS WILL NOT CHANGE. THE TYPE OF EARLIER RIGHTS THAT CAN BE RELIED ON FOR RELATIVE GROUNDS (IN THE EU) WILL.

Ongoing UK opposition/cancellation procedures unlikely to be affected.


Trade Marks – Oppositions (continued)

UK Comparable Marks –

• use/reputation BEFORE 31 December 2020 sufficient for EU oppositions

• use/reputation AFTER 31 December 2020 not sufficient for EU oppositions

UK Oppositions – unaffected (unless it is based on a pending EUTM registration)


Trade Marks – Cancellation

Trade marks are vulnerable to cancellation based on non-use after five-year period following registration date.

If either a UKTM or EUTM is not used across the border (e.g. a UKTM is not put to use in the EU) after 31 December 2020, after five years it will be vulnerable to non-use revocation.

Consider future use of trade mark NOW.


Licences/Security Interests

A recordal of a licence of security interest on a comparable UK trade mark will not be automatic.

Period for Recordals will be extended to 12 months rather than six after 1 January 2021.


Designs

Current design rights in the UK and EU:

Registered design rights:

Registered Community Design (EU) (RCD)

UK Registered Design

International (EU) Design or International (UK) Design

Unregistered design rights:

Unregistered Community Design Right (EU) (CUDR)

UK Unregistered Design Right (UKUDR)


Designs

Changes to design rights largely reflect the changes to trade mark rights – 31 December 2020, date which changes will take effect.

Registered community designs or international (EU) designs will no longer cover the UK.

“Re-registered” designs will be created in the UK to protect any RCD or International (EU) with registered/protected status on 31 December 2020.

International (UK) designs are unaffected.


“Re-registered Designs”

Automatically created if the EU design right has registered/protected status from 1 January 2021 onwards.

No official fees.

Filing and priority dates preserved.



Pending Registered Community Designs or International EU designs will not receive a comparable UK right.

RCDs still subject to deferred publication by 31 December 2021 will not receive a comparable UK right.

Separate application/examination process.

Nine months to apply for RCD priority/filing date.

Option to opt out after 31 December 2020.



Different renewal dates – docket new deadlines.

Record licences/assignments/security interests separately within 12 months of 1 January 2021.

Notify licensees.


Copyright

Copyright law is an automatic right afforded to the creator of an expression of an idea. It is not registrable.

In the UK and EU, protection usually lasts 70 years after the author’s death.

Copyright law is mostly a matter of domestic law.

Largely remain unaffected as a result of Brexit.

Over time, UK copyright law may diverge away from EU law.


Domain Names

Owners of domain names have acquired protection through common law provisions, both in the UK and EU.

Holders of .eu domain names must be:

• A Union citizen

• A resident of a member state

• An undertaking that is established in the Union; or

• An organisation that is established in the Union


Domain Names

Effective on IP Completion Day:

• UK residents or non-EU citizens with no commercial establishment in EU will not be able to hold a .eu domain name.

• Retroactive effect – .eu domain name will be taken away, as well as no future registrations possible.

• If not eligible, domain name will be released and re-registrable as of 1 January 2022. 12 months to prove eligibility.


Take Action Now!

Draw up a checklist of all the intellectual property you and/or your business holds.

If you hold a EUTM or RCD and you want an equivalent UK right, make sure it does not expire before the end of the Transition Period.

If you manufacture, trade or sell products/services in the EU, consider registering your trade mark in the EU. This will strengthen your legal position within the EU going forward.

Consider how your domain name might be affected. You will need to make alternative arrangements if you hold a .eu domain name and don’t reside or have a business in the EU.


Take Action Now!

Remember that there may be an influx of new UK domain names after Brexit, so it is important to watch out for potentially infringing domain names.

Review all agreements to which your business is a party to, to ensure that there are necessary clauses and provisions in place that prevent the agreement from being negatively impacted by Brexit.

If you think your agreement may be affected, seek legal advice to double check the position.


Q&A


Michael Gnibus 212.209.4442 / [email protected]

314.259.4784 / [email protected]

Courtney Jackson

+44 20 7539 7312 / [email protected]

Zane Shihab

Webinar CLE Accreditation Code: TJAM54

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