CIPA Journal, July-August 2017 by CIPA Journal

CIPA JOURNAL Incorporating the transactions of the Chartered Institute of Patent Attorneys

July-August 2017 / Volume 46 / Number 7-8

SPC review UK questions await CJEU answers

Appeals in first instance judgments Holly Mitchell

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Limits of the jurisdiction of the UPC Nicholas Fox

Are changes to Rules 27 and 28 EPC illegal? CIPA’s comments

Surviving Alice in the finance arts Mark Nowotarski

The not-so-secret diary of a CIPA President Andrea Brewster

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A global, future-facing law ﬁrm whose unique team of patent specialists works with clients directly in all the most interesting sectors.

Creative Modern Specialists It’s not just the quality and variety of our clients that keeps our patent attorneys engaged, it’s the ﬂexible working, cutting edge technology and career development. Partnership’s a possibility, not a pipe dream. Energy / Financial Services / Infrastructure & Project Finance / Life Sciences and Healthcare / Real Estate / Technology, Media & Telecommunications

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CMS Cameron McKenna Nabarro Olswang LLP is a member ﬁrm of CMS.

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Contents 34-43 63

UP FRONT

ARTICLES

EDUCATION

64 66 67 68 69 70 71 72 76 78

Editorial

Alasdair Poore 4 5

Holly Mitchell

Chief Executive’s report

Lee Davies

Council Minutes

Lee Davies

Surviving Alice in the finance arts

Mark Nowotarski 24

NEWS

First instance judgments – keeping us in suspense?

Jurisdiction of the UPC

Nicholas Fox 27

SPC Summer Review 2017

Carpmaels & Ransford 8

Media report

Neil Lampert 9

China update: SIPO

Toby Mak 39

Changes to Statutory Patent Fees Are changes to rules 27 and 28 EPC illegal? Overseas report

Amanda R. Gladwin 15

Thailand update

DECISIONS

Book Review Institute events UP and UPC webinars Life Sciences Conference CIPA Congress 2017 Patents Case Law South of England seminar Trade Secrets Directive EPO Oppositions and Appeals Life on the Inside

China update: litigation

PERSONAL

Toby Mak 74

The not-so-secret diary

Andrea Brewster

61 62 63 65

Going Remote Announcements Letter to the Editor Former President of CIPA, awarded OBE

Gladys Mirandah & Hilmi Bin Zaini 15 16

Manual of Patent Practice updates UPC case management system

Patent decisions

Beck Greener 45

Mark Richardson

Barker Brettell 46

EPO decisions

Bristows 48

THE PINKS

IPO decisions

80 83 82

Courses and events International Recruitment

Trade marks and other IP

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NEWS

Authorities (ISAs) and International Preliminary Examination Authorities (IPEAs) recognised by the DIP. The section 44 order is expected before the end of 2017. Patent holders with outstanding applications must, therefore, be vigilant in order to process their matters more swiftly using the new initiative. Using a section 44 order shows that the Thai government is serious about improving the enforcement of IPRs.

OVERSEAS • UPC

Another step towards improving the efficiency of the Thai patent system is the two-year extension of the Patent Prosecution Highway (PPH) pilot programme between the DIP and the Japanese Patent Office. The PPH will now run until December 2017. Another avenue for an accelerated examination process in Thailand is via ASEAN cooperation. In addition to the Thailand’s participation in the ASEAN Patent

Examination Cooperation programme, ASEAN cooperation in the patent sphere is set to be boosted in 2017 with the DIP expected to recognise the Intellectual Property Office of Singapore as a competent ISA and IPEA for PCT applications filed with the DIP or WIPO’s International Bureau as the receiving office. Gladys Mirandah and Hilmi Bin Zaini (Mirandah Asia).

UPC case management system Testing the Unified Patent Court case management system: new version expected soon.

he UPC will have an electronic case management system (CMS) for lodging actions, applications, opt-out requests and appeals. European Patent Attorneys have the benefit of experience with EPOline in approaching the CMS, and this is very useful as the CMS should be as accessible as EPOline to operate. The CMS is currently in beta testing and CIPA is keen that as many potential users as possible take up the opportunity offered by the UPC Preparatory Committee to try out the system. The CMS is, at the time of writing this article, on version 0.39. This version covers all of the actions mentioned above. However, it is the author’s understanding, following a recent conversation with Eileen Tottle (Head of Secretariat, UPC Preparatory Committee), that a new “pared down” version of the CMS will be released in July 2017 (potentially mid-July). This new version of the CMS will apparently focus on the opt out process. Since the opt out section of the CMS is likely to be the area that patent

UPC CMS test site: front page

attorneys initially use, all readers are encouraged to set up a user account for testing and to feed comments back to CIPA for consolidation/sharing to the CMS developers/UPC Committee in addition to feeding back to the software developers. Please keep an eye open for communications from CIPA regarding the preferred mechanism for the submission of comments.

Further information •

•

Rules of Procedure – see Rule 5 for the Opt-out process – https://www.unified-patent-court.org/sites/default/files/ upc_rules_of_procedure_18th_draft_15_march_2017_final_clear.pdf There are walkthroughs of earlier versions of the CMS on the IPcopy blog –see https://ipcopy.wordpress.com/tag/cms-beta/ for more background on the CMS.

At the time of writing, we eagerly await the new version to see whether and how it addresses a number of issues that were flagged up in feedback to the developers. Once the new version is released it will be important that it is fully tested so that any remaining issues be identified and resolved before the system is finalised. Accessing the CMS: The CMS can be found on the UPC website at https:// www.unified-patent-court.org/ – Look for “Cases” in the right-hand menu and click the link to be taken to the log in page of the CMS. Setting up a user account for testing purposes only takes a few minutes. Mark Richardson (Fellow)

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First instance judgments – keeping us in suspense?

It is apparent that in some circumstances, the question of whether appeals have a suspensive effect in first instance judgments in England and Wales is not clear-cut. Holly Mitchell provides a useful reminder on what happens when a right to appeal is granted and how it might impact on the judgment or order itself, as well as the implications for costs and damages.

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he Civil Procedure Rules 1998 set out the prescribed procedure for dealing with judgments and appeals here in England and Wales, with a first instance judgment having immediate effect from the moment it has been given (or as the court may otherwise specify) (CPR r40.7). Even when an appeal is granted, by either the appeal court or the lower court, unless either court orders otherwise, it will not stay an order or judgment by the lower court (CPR r52.16). When the judgment and relevant orders are deemed to take effect, and are actionable by the parties, will therefore be determined on a case-by-case basis. Considering the process by which an appeal arises following a decision at first instance, a party must be granted permission to appeal (CPR r52.3) or if this is not expressly requested at lower court proceedings, a party may subsequently make an application to appeal. The potential appellant must overcome the relevant threshold (see CPR r52.3) in order for the court to grant permission to appeal: the appeal must have a real prospect of success, or there is some other compelling reason why it should be heard. An application for permission to appeal is usually made to the lower court at the hearing at which the decision was made. Alternatively, an application for permission to appeal can also be made to the appeal court in a formal appeal notice. Every appellant’s notice (including one seeking permission to appeal) must be filed not later than 21 days after the date of the decision of the lower court (CPR r52.4) If a party wishes to stay an order made in a judgment pending an appeal, it will need to seek a stay of that order. JULY-AUGUST 2017

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Surviving Alice in the finance arts

The US Supreme Court’s 2014 decision in Alice Corp. v CLS Bank (“Alice”)1 has had a dramatic impact on the allowability of computer-implemented inventions in the field of business methods (i.e. finance and e-commerce). The Alice decision held that “abstract ideas”, including ideas related to fundamental economic practices, were not statutory subject-matter under 35 U.S.C. 1012. The patents held invalid in the Alice decision were in the field of business methods. This is the first in a series of articles by Mark Nowotarski exploring the dynamics of that impact on the prosecution of business method patent applications as a useful guide for patent practitioners.

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he US patent examiner corps is organized by technology centres (e.g. 3600 computer-implemented business methods3). Technology centres are organised by work groups (e.g. 3620 and 3680 e-commerce, 3690 finance). This paper will focus on work group 3690 finance. The next paper will focus on work groups 3620 and 3680 e-commerce. Work group 3690 is the most heavily impacted work group by the Alice decision. The patent applications examined by this work group include computer-implemented inventions in the fields of banking, investment, portfolio selection, tax strategies, trading, credit, funds transfer, and insurance. Figure 1 shows the total number of allowances per month, abandons per month and appeals per month for patent applications examined in work group 3690. It covers the period from January 2014 to February 2017. The data is originally from the USPTO’s public PAIR4 system. PatentAdvisor™ was used to collect and process the PAIR data5. There are currently about 80 examiners in this work group. The work group produces about 8,400 office actions-on-the-merits per year (i.e. non-final rejections, final rejections and allowances). Prior to Alice, about 2,100 of the actions per year were allowances (25% of the total actions). Post-Alice, only 220 of the actions per year have been allowances (2.6% of the total actions). Inventions in the finance arts are classified primarily as US classes 705/035 through 705/045, as well as 705/004 (insurance)6. The patents invalidated in Alice were all in these classes7. While it is not surprising to see that there was a substantial drop in allowances in the finance work group, what is surprising was how fast the allowance rate dropped after the Alice decision. The Alice decision was handed down on 19 June 2014. Six days later the USPTO issued a three-page preliminary guidance memo that simply summarized the case. The allowances per month in the finance work group plunged the very next week to onewww.cipa.org.uk

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tenth of its pre-Alice value. The median number of allowances per examiner in the first two years after Alice was one. That means that a typical examiner in the finance work group is only allowing one case every two years. Many have not allowed any at all. The USPTO followed up its initial guidance with the December 2014 “Interim Guidance”, the “July 2015 Guidance”, and the May 2016 “101 Guidance”.8 None of this guidance has had any measurable impact on increasing the allowances per month in this work group. The drop-in allowances per month has led to a predictable increase in abandons per month. The abandons per month for applications in the finance work group is up by more than a factor of two. The appeal rate went down, then up, then down again. It is now at about the same level as before Alice. Prior to Alice, however, appeals were mostly related to novelty (35 U.S.C. 102) and obviousness (35 U.S.C. 103). Now the appeals are mostly related to 101 rejections under Alice. While exploring the sharp drop off in allowances, I discovered quite a few cases allowed before Alice that had their allowances withdrawn right after Alice. These withdrawals were announced by the USPTO on 4 August 20149. The

allowed cases that had not yet issued by the time of the Alice decision were examined again in July 2014. Those that were not considered statutory under Alice had their allowances withdrawn. There was also a second smaller batch of postAlice allowances that were withdrawn in October 2014. We refer these bulk withdrawals of allowances as the “July 2014 recall” and the “October 2014 recall”. Figure 2 (page 22) shows the recalled allowances on the dates the allowances were originally issued. The allowances withdrawn in July 2014 are shown in red. The allowances withdrawn in October 2014 are shown in black with a red border. The allowances that ultimately issued as patents are shown in green. After each recall, the cases were reassigned back to examiners and new rejections under 35 U.S.C. 101 based on Alice were issued. These new rejections came out over a period of several months. At the time of the July 2014 recall, there were about 405 cases allowed but still pending. Subsequently, 250 of these cases had their allowances withdrawn and 78 proceeded to issue on a normal schedule. Another 77 had their issuance delayed until the end of December for reasons that are unknown. The October 2014 recall was much smaller and different in scope, in that while only five allowances were withdrawn, all

Figure 1: Alice impact on allowance, abandons and appeals, Work Group 3690 (Finance)

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ARTICLE

not that unusual; article 35 of the Brussels Regulation permits actions for provisional measures to be obtained from any EU court, even if another court has exclusive jurisdiction as to the substance of the matter. The grant of provisional measures will always be at the discretion of the Court. The circumstance where the Court might be persuaded to grant provisional measures over an opted out patent or a European patent outside a non-UPC contracting member state are likely to be highly fact specific. i. EU non-UPC contracting states Potentially, the ability to seek provisional measures in respect of European patents in non-UPC EU contracting member states may be significant. At present many EU countries have yet to ratify the Unified Patent Convention and it is likely that when the UPC does come into effect, many will still fall into this category. It will remain to be seen the extent to which the UPC might be persuaded to grant provisional measures having effects beyond the UPC contracting member states. It is certainly not impossible that the Court might be willing to grant interlocutory relief, where a European patent has been maintained broadly both in UPC contracting states and beyond or where a Unitary Patent has been granted and European patents obtained in nonparticipating states, upon an undertaking to initiate parallel proceedings in those non-participating states. Grant of such interlocutory relief is entirely consistent with the ethos behind the Brussels Regulation, which permits provisional measures to be granted even though a Court lacks jurisdiction over the substance of a matter. The essence of the UPC is that it already has an international jurisdiction and as such it may be possible to persuade the Court to grant relief in circumstances where national courts would be more reluctant to do so. ii. Opted out European Patents Article 83 of the UPC Agreement provides for a transitional regime which is to apply for the first seven years of the existence of the UPC, a period which can, if thought appropriate following consultation, be extended by a further seven years. During this transitional period, article 83(3) states that, provided no action has already been brought before the Court, a proprietor of or an applicant for a granted European patent or pending European patent application or the holder of any associated SPC can opt individual patents and applications and associated certificates out of the exclusive competence of the Court. When it comes to opted out patents, normally a patent proprietor can withdraw an opt out at any time and doing so would then place a patent firmly within the jurisdiction of the Court. It is, however, possible to foresee circumstances where the Court might be persuaded to grant provisional measures notwithstanding that an opt out has not been withdrawn. The first, and probably the most likely scenario, would be where a patent proprietor wishes to take action against an 26 CIPA JOURNAL

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infringer but there is some kind of formal issue regarding the proprietor’s ability to withdraw an opt out. This could potentially arise if there were a delay in updating the opt out register (for example due to an IT issue) or in circumstances where co-ownership of a patent resulted in difficulties or a delay in filing a withdrawal request. Where immediate action to prevent infringement was required and a proprietor undertook to withdraw an opt out as soon as possible, it is possible that the Court might look favourably on a request for preliminary measures despite a patent formally not falling within the remit of the court. A second and potentially more interesting scenario would be where a request for preliminary measures was brought based on multiple patents, at least one of which did fall within the jurisdiction of the Court. Such a scenario could arise where, for example, a patent proprietor sought provisional measures based on related patents such as a parent patent and an associated divisional patent where one of the patents had been opted out of the jurisdiction of the Court. Ordinarily, an opt out can be withdrawn at any time and it would be expected that the Court would normally be persuaded to exercise its discretion to grant provisional measures only upon an undertaking to withdraw an opt out or to initiate corresponding litigation in the national courts in due course. However, an exception exists where an opted out patent has been involved in national proceedings. This gives rise to the possibility that a potential infringer might initiate national invalidity proceedings in an attempt to “pin” an opt out patent in the national courts. In such a scenario, where a related patent falling within the jurisdiction of the Court existed and a patentee provided an undertaking to initiate parallel proceedings in the national courts in due course, it is possible that the Court might be persuaded to grant broader provisional relief based on a right which was not formally within the scope of its jurisdiction. Nicholas Fox (Fellow), Simmons & Simmons LLP

References 1. Regulation (EC) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgements in civil and commercial matters (OJ L 351, 20.12.2012, p.1) as amended. 2. For further details and historical background see Pierre Véron, “Extent of the Long-Arm Jurisdiction Conferred upon the Unified Patent Court by article 71(b)(3) of the Brussels I Regulation as Amended by Regulation 542/2014, 15 May 2014: Turkish Delight and a bit of Swiss Chocolate for the Unified Patent Court”, EIPR Vol. 37 Issue 9, 2015 pp 588 – 596.

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SPC summer review 2017 The past year has seen several interesting developments for supplementary protection certificates (SPCs) in Europe. There has been new case law from the Court of Justice of the European Union (CJEU) and several important decisions from the national courts and patent offices. This review summarises the key judgments since its last review in mid-2016, arranging them within broader topics that have been exercising SPC practitioners over the years. These issues include when does a patent “protect” an active ingredient, what happens if a marketing authorisation has not quite been issued by the time the basic patent expires, and what scope of protection is provided by an SPC in the biologics field. In the first of a two-part review, Carpmaels & Ransford’s summarise the current state of play in this interesting and fast-moving area of IP law. Daniel Wise (Fellow) and Natalia Wegner-Cribbs (Fellow)

Article 3(a) and SPCs for combination products How do you determine whether a product is protected by a patent? This issue, as far as it relates to article 3(a) of the SPC Regulation, has been the subject of several CJEU referrals over the years. In Medeva v Comptroller General of Patents, Designs and Trade Marks (C-322/10), the CJEU held that the product must be “specified” in the wording of the claims of the basic patent in order to be protected. Later, we learnt in Eli Lilly & Co Ltd v Human Genome Sciences Inc (C 493/12) that functional wording is sufficient in principle to “specify” a product, provided that the claims relate to the product “implicitly but necessarily and specifically”. The question of compliance with article 3(a) has often arisen alongside article 3(c) in the context of SPCs for combination products. For example, in Actavis UK Ltd v Boehringer Ingelheim Pharma GmbH & Co. KG (C-577/13) the CJEU held that article 3(c) precludes the grant of a second SPC for a combination product where the basic patent has already been used to obtain an SPC for a constituent active ingredient constituting the “sole subject-matter of the invention” protected by that patent. National courts (as well as practitioners and patent offices) now face the difficult task of making sense of this flurry of CJEU judgments. In the UK courts, this task has repeatedly fallen to Mr Justice Arnold, who handed down three judgments in this area in the past year.

CJEU to consider article 3(a)… again Teva & others v Gilead Sciences Inc [2017] EWHC 13 (Pat) concerned Gilead’s SPC based on its marketing authorisation for Truvada®, which contains a combination of tenofovir disoproxil and emtricitabine. Teva had challenged the validity of the SPC on the ground that the basic patent did not protect the combination of tenofovir disoproxil and emtricitabine as required by article 3(a) because the basic patent does not mention emtricitabine. However, Volume 46, number 7-8

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SIPO update Continental Drift: SIPO’s April 2017 examination guidelines bring significantly improved alignment with EU and US rules in software and pharma fields

The Chinese State Intellectual Property Office (SIPO) has significantly revised its examination guidelines with respect to inventions relating to business methods and software, submission of post-filing data for chemical/bio inventions, scope of post-grant amendments during invalidation proceedings, inspection of files before and after grant, and stay of SIPO proceedings due to court orders. Many of these changes are the result of efforts from the discussions with various foreign parties with SIPO. Toby Mak discusses the details.

IPO has revised its patent examination guidelines (the “Guidelines”), and these became effective on 1 April 2017. The changes cover:

1. 2. 3. 4.

inventions relating to business methods; inventions relating to software; submission of post-filing data for chemical/bio inventions; scope of post-grant amendments during invalidation proceedings; 5. inspection of files before and after grant; and 6. stay of SIPO proceedings due to court order Many of these changes significantly change patent practice in China, and are discussed in detail below. My own personal comments are in square brackets.

Inventions relating to business methods (Section 4.2, Chapter 1, Part II) After the revision, the Guidelines specifically include a statement: “If a claim related to business method includes business features and technical features, then the possibility of this claim being patentable should not be excluded according to article 25 of the Patent Law [Note: this is the article in the Chinese Patent Law relating to patentable subject-matter]” – in the examples of determining whether a claim is substantially directed to business or mental method. [Comment: This section of the Guidelines highlighted the above statement, but only after the examples, and acted as an exception only when a claim was not substantially directed to business or mental method. A claim was considered to be substantially directed to business or mental method if its limiting contents are business or mental method other than the 34 CIPA JOURNAL

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CHINA UPDATE

preamble, while only features novel from the prior art were considered as limiting features. That is, before the above change, even if a claim included a technical feature, like a computerimplemented step, a non-patentable subject-matter objection could be raised if this technical feature was considered by an examiner to be not novel. It is believed that the above change is to extend this previous exception to all determinations of whether a claim is directed to business or mental method, i.e. as long as a claim has a technical feature, a non-patentable subject-matter objection should not be raised. This change may be much needed by the booming local software/Internet-related businesses in China. This change was a topic discussed with the AIPLA’s China delegation in the last few years.]

Inventions relating to software (Chapter 9, Part II) Software recorded on computer-readable medium is now patentable. [Comment: This completely changes the current practice. Computer-readable medium recording new and inventive software was not patentable in China.] The following changes are even more substantial: •

Component(s) of an apparatus claim can include not only hardware but also software. [Comment: If applied broadly, this would allow claims in the format “An apparatus incorporating the method of claim 1”. However, an examiner may interpret the amendment narrowly, requiring that an apparatus claim must recite a hardware component; this could be overcome easily, for example, by reciting a processor performing the software’s method steps (therefore it is advisable to state that the method steps of a software invention could be performed by a processor or other components in the specification to provide basis of amendments). Either way, this change could prevent an examiner objecting to an apparatus claim reciting method steps on the basis that such steps could not limit the apparatus claim. Such objections were typical in China upto now.]

•

A module in an apparatus claim can be in the form of a software module, instead of functional module (as was required before the changes).

[Comment: This corresponds to the change of allowing an apparatus claim to include a software component. This further confers broader scope to an apparatus claim incorporating software, as it is no longer necessary to recite functional module, which could be interpreted as discrete physical module in the apparatus. Although the Guidelines before the revision already specified that a functional module was not an actual physical module but could be a virtual module realizing a step of a software, some Chinese courts adopted a strict literal Volume 45, number 7-8

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interpretation of the language “a device configured to perform a step/function”, and considered this to be ambiguous, and that the claim was not enforceable. Hopefully, this change could resolve these issues. These changes would allow an invention relating to software to be patentable in the form of apparatus claims more easily with broader scope. Again, the above changes may be much needed by the booming software/Internet-related businesses in China. It is also interesting to note that these changes were one of the topics discussed with the AIPLA’s China delegations in recent years.]

Submission of post-filing data for chemical/bio inventions (Section 3.5, Chapter 10, Part II) Before the revision, the Guidelines specifically exclude submission and consideration of post-filing data to support sufficient disclosure of an invention. After the revision, the Guidelines now require that supplemental experimental data submitted after the date of filing is examined, provided that the technical effect proved by such post-filing data shall be available to the person skilled in the art from the disclosure of the patent application. [Comment: The strict bar of submission of post-filing data has troubled many applicants in the chemical, pharmaceutical, and biotechnology fields in China. SIPO has received requests from various foreign entities to lift this bar (for example, this was always one of the topics in meetings between SIPO and AIPLA delegations to China), and SIPO has finally provided a positive response. The following points should be noted. The current wordings of the Guidelines require that in order for the post-filing data to be admissible, “the technical effect proved by such post-filing data shall be obtainable by a person skilled in the art from the disclosure of the patent application”. It is not certain what would be considered as sufficient. For example, would a declaration from one of the inventors confirming that the post-filing data submitted is from experiments repeated according to those in the specification be enough? What if the technical effect proved by the postfiling data was not explicitly recited in the specification but, nonetheless, could be derived from the specification? If so, is it necessary for the technical effect be derived directly and unambiguously from the specification, as required to avoid added matter in China? In any event, I believe the current wording “the technical effect proved by such postfiling data shall be obtainable by a person skilled in the art from the disclosure of the patent application” is included to specifically prevent selection of a specific compound in a Markush claim while the original disclosure contains no recitation of any superior property of this specific compound over other compounds in the Markush claim. This was what happened in the invalidation of the Viagra patent in China. Specifically, the active compound sildenafil – 5-[2-ethoxyJULY-AUGUST 2017

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CHINA UPDATE

•

The US donation principle does not appear to be applicable to China. In Miller v Brass, there was a delay of 15 years to apply for re-issuance of the patent for the alternative scope originally not claimed. However, China does not have re-issuance of a granted patent as in the US allowing the patent to pursue alternative scope of patent protection.

However, this is not news to Chinese patent practitioners – for example, restrictions on addition of new claims when responding to an office action is another area of the Guidelines imposing restrictions not in the Law.]

Inspection of files before and after grant Pending and published invention patent application before grant Before the revision, for a pending and published invention patent application, office actions issued during substantive examination and their respective responses were not available to a third party. These are now available to a third party. [Comment: I never figured out why the above documents were not available to the public. This change should be welcomed, which makes a lot of things easier, for example submission of third-party observations to a pending application, monitoring progress of an application to determine whether invalidation should be filed after the application is granted, and so on. I welcome this change. The following should be noted: •

Only the response to an office action is available, but not the amended claims as filed. This is an established proceedure in China, again for reasons unknown to me, that the amended claims filed when responding to an office action are not available to the public. Nonetheless, the response could give hints on how the claims are amended, or in many cases clearly indicating how the claims were amended. This may be the reason why the amended claims are not available, but it should not take SIPO too much effort to make these amended claims available, either. SIPO may consider this as the next improvement.

•

SIPO has recently made available electronically filed applications for online inspection of files. However, applications filed before 2014 are not available, as electronic filings were not popular at that time, and most (if not all) of the filings were on paper. With the volume of applications received by SIPO, this is entirely understandable.

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•

The priority document is not available. This will be discussed later.]

Already granted patents Before the revision, while almost all documents before (e.g. office actions and their responses) and after (e.g. invalidation notifications or decisions) grant are available to the public, for an unknown reason the priority document of a granted patent was not available; now the priority document is available. [Comment: Although it is not clear why the priority document was not available to the public in the past, again this should be a welcomed change, which could make challenging the priority claim of a granted patent easier. On the other hand, it is unclear why the availability of priority document is not extended to pending and published invention patent applications.]

Stay of SIPO proceedings due to court order Before the revision, the length of stay was limited to between six and 12 months depending on the court proceedings involved (12 months for ownership dispute, and six months for disputes involving property preservation). After the revision, the length of stay will be determined by the court, which is in turn bound by the Supreme Court’s Explanation Applicable to Civil Litigation Law of 2015 to be not more than three years. [Comment: These changes are reasonable and to avoid conflict with the operation of a Chinese court.]

Conclusion Most, if not all, of the revisions should be welcomed by Chinese patent practitioners. These revisions bring the Chinese practise closer to those of the US and Europe. Business method claims are now less likely to receive a non-patentable subject-matter objection. Software methods recorded on computer-readable medium, and apparatus claims reciting method steps are now allowable. Submission of post-filing data is no longer an absolute bar in China. The scope of post-grant amendments, and inspection of patent prosecution files, particularly those of pending and published invention patent applications, have been broadened. However, it is intriguing, if not astonishing, to see that SIPO insisted that the incorporation of feature only recited in the description but not in the claims is not allowed despite a contradicting Supreme Court’s decision in 2011. Another interesting observation is that the efforts from the discussion of various foreign parties with SIPO could result in substantive changes, which is encouraging. Toby Mak, Tee & Howe Intellectual Property Attorneys. www.cipa.org.uk

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Patent litigation in China Disputes over standards essential patents are increasingly being exposed in the courts, as can be seen from the CJEU decisions (such as Huawei v ZTE) and in the UK in relation to the Unwired Planet litigation1, giving a detailed insight into a wide range of issues beyond simple infringement and validity. In his discussion of Sony’s defeat in the recently established Beijing IP Court, Toby Mak shows that such cases in China are no different, with punitive damages and an injunction being granted, as well as (by Chinese standards) substantive costs.

n 22 March 2017, the Beijing Intellectual Property Court (“the Court”) issued a decision confirming that Sony2 infringed an Iwncomm3 patent. The Court imposed punitive damages on Sony, which was ordered to pay Iwncomm 9,103,367 RMB (about £1.03 million). This included expenses for litigating the case of 474,194 RMB (about £53,750), and damages of 8,629,173 RMB (about £978,240). The Court also granted an injunction against Sony. According to reports of the Court’s decision, Sony presented some very interesting, if not intriguing, arguments to defend against Iwncomm’s infringement claim, which could be illuminating4. After setting out the background, this article focuses on the following issues: 1. Why Sony failed to defend itself against infringement. 2. Why punitive damages were invoked, and an injunction granted. 3. Why compensation of 9.1 million RMB awarded against Sony was reached. As usual, my personal comments are in square brackets.

Background The technology involved in this case was the WLAN Authentication and Privacy Infrastructure, or “WAPI”. This is a security protocol for wireless networks (WLANs). More commonly known wireless network security protocols include WEP, WPA, and WPA2. [Comment: If you have tried to set up your own WLAN security with your router, this is one of the options you need to choose.] WAPI became a Chinese national standard in 2003. China tried to make this an ISO standard, but this was rejected in 2006, and the attempt was finally withdrawn in 2011. However, WAPI remains a Chinese standard, and each and every mobile phone having a WLAN function is required to be tested for compliance with this WAPI standard if it is to be sold in China. Volume 45, number 7-8

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JULY-AUGUST 2017

CIPA JOURNAL

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