Will IP lead the UK out of recession in 2011?

The Patent Box is expected to go ahead, reducing taxation on patent-derived profits, while the Hargreaves review of IP is due in May, having had only a few weeks to investigate and consult on the intellectual property system. Its remit is to look at innovation in the digital economy, and answer Prime Minister David Cameron’s question as to whether the UK’s IP laws really are the reason why this country has not produced a Google.

Reforms to the UK’s Patents County Court, together with the appointment of the new Patents County Court judge, His Honour Judge Birss QC, have already dramatically transformed opportunities for small and medium-sized enterprises (SMEs) to enforce their intellectual property.

Already we are seeing guidance and encouragement from the court that it is fully focused on providing access to an effective enforcement mechanism for smaller enterprises—a system that will in due course compete very effectively with those in other continental jurisdictions.

That does not mean that businesses in the innovation field will not continue to face challenges in 2011. A common message not just from government, but even more compellingly from businesses, is that pots of money are smaller and budgets are cut—and they therefore want more for less.

This is a key message for IP practitioners, and one that is reflected strongly in CIPA’s focus on training for patent attorneys, in supporting initiatives for more efficient working within patent offices, and in greater international co-operation.

More international co-operation

Patent backlogs have been steadily climbing the intellectual property action charts.

In March 2010, the UK IPO introduced its report on the damage that delayed grant of patents is causing (Patent Backlogs and Mutual Recognition: An economic study by London Economics), to illustrate how important change is. One may quibble with the methodology and the analysis of the report—indeed many of us do—but one cannot argue with the fact that it has been used repeatedly to provide added momentum to justify addressing issues about patent grant taking too long.

The International Federation of Intellectual Property Attorneys (FICPI) held a meeting in June 2010, followed by a colloquium hosted jointly by the American Intellectual Property Law Association and FICPI on the ‘Patent Backlog Crisis’.

Both meetings endorsed the need to address patent backlogs, and to do so intelligently—some businesses, such as electronics and telecommunications companies and start-ups suffer heavily if patent grant is delayed. On the other hand, there has been a consistent message that patent offices have taken on board: patent quality is absolutely fundamental.

David Kappos, Commissioner of the United States Patent and Trademark Office (USPTO), restated his organisation’s commitment to greater international progress during a meeting in April with Baroness Wilcox, UK Intellectual Property Minister.

“The joint action plan highlights that while 21st century patent challenges are global in scope,” he said, “so too are their solutions. By reducing redundant workloads and chipping away at the backlog, we can collaborate to unleash millions of jobs lying in wait and breathe life into our economies.”

The US and UK governments are continuing to make considerable progress: the ‘patent prosecution highway’, which permits accelerated examination or a patent application in one office using results from an earlier examination in another, is moving from pilot to prototype and is likely to be extended; and patent reform in the US, including adoption of the European classification system looks set to make life simpler (and therefore less costly) for applicants both in the Europe and the US.

One of the strongest themes coming out of these meetings is what patent offices are doing together—often on a bilateral basis—to make the progress of patent applications more efficient: sharing information, exchanging staff and getting a better understanding of each other’s processes, in order to make the patent prosecution process work more effectively.

This co-operation has replaced ideas of mutual recognition (referred to in the title to the study mentioned above), and follows a trend of setting up arrangements or ‘platforms’ for assisting each other, which can be adopted without widespread multilateral agreement.

Bumpy progress in Europe

Languages, courts and unitary patents are a theme firmly taken up by the European Commission, seemingly determined to break 50 years of deadlock over a patent for Europe. Significant progress was being made, with all countries except Spain and Italy agreeing on languages. Then the European Court of Justice threw a wobbly at a unitary European patent court—seen by some as an essential component of an attractive European unitary patent system.

The European Commission is still, however, pressing ahead with an ‘enhanced co-operation’ on a European Union patent, which will include all states that are willing to agree—at present, all but Spain and Italy. The proposed cost makes it look as though it might gain business support even if not seen as the most attractive solution.

At the same time, the Max Planck Institute report on the European trademark system has, after a long wait, been published. The Commission is understood to want to make proposals for reform by the end of 2012.

Meanwhile, the European Patent Office and Court of Justice for the European Union are still flavouring the jurisprudence on both patent and trademark protection. Despite the valiant efforts of Lord Justice Sir Robin Jacob, and then the UK government proposing that a more restrictive approach to patentability of software should be adopted, the Enlarged Board of Appeal opted for saying that the reference on software patentability was not admissible.

The existing rules are just fine, which still leaves potentially different approaches in the UK and Europe on software patentability.

Meanwhile, the law in the biosciences field has seen ups and downs—with second medical uses extending to dosage and administration regimes (up) and the Biotechnology Directive being held to exclude gene patents covering genes where they are not actually performing their function, for example in dormant samples (down).

In trademarks, the Internet, and particularly comparative advertising, different sales channels and the use of tags and adwords, as well as an increasingly cluttered Community trademark register, will keep practitioners on their toes for some time to come.

IP professions’ new regulatory framework

This year sees the new regulatory framework settling down.

This framework provides for independent regulation of the UK patent and trademark professions by independent regulatory arms of CIPA and the Institute of Trade Mark Agents (ITMA). CIPA and ITMA have worked very closely together on establishing and weaning the independent regulator.

The institutes believe that high professional standards are fundamental to ensuring the establishment of not just an effective intellectual property profession, but also an effective working intellectual property system (in the UK and internationally).

This is reflected by the fact that CIPA continues discussions with institutes and organisations from the Far East and China to North America on how its regulatory framework operates and how effective regulatory frameworks can be put in place. CIPA and ITMA have always regarded an understanding of how systems in other countries work as important and this has been part of their examination systems.

In addition, CIPA is increasing the level of continuing professional development training. There will be increasing emphasis on a wider understanding of the environment that businesses operate in—this year extending to new students planning to qualify as patent attorneys, by introducing a detailed induction course on aspects of good business practice, even before attorneys qualify.

The next stage in regulatory change is to facilitate greater flexibility in practices, permitting them to work in partnership with other professionals—IP practitioners from other jurisdictions, as well as specialists in other fields such as licensing and finance and business.

Will IP stay high on the agenda?

We will also have to watch with interest whether political support for intellectual property will remain constant—there is still substantial pressure against IP from some lobbies—and whether education can assist consumers as well as government in understanding the value of intellectual property. This will no doubt feature in the UK government’s coming review of intellectual property.

Alasdair Poore is president of the Chartered Institute of Patent Attorneys and head of intellectual property at Mills & Reeve LLP. He can be contacted at: alasdair.poore@mills-reeve.com