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Applying for a patent

Patentability
What are the criteria for patentability in your jurisdiction?

The basic criteria for patentability are:

  • subject matter;
  • novelty;
  • inventive step; and
  • industrial applicability.

Subject matter
The Patent Act defines an ‘invention’ as "the highly advanced creation of technical ideas by which a law of nature is utilized".

Novelty
In line with other regimes, Japanese patent law does not grant exclusionary rights to existing technologies. Article 29(1) of the Patent Act stipulates that inventors may not obtain patents for:

  • inventions that are known to the public (Item i);
  • inventions that are publicly used (Item ii); or
  • inventions that are described in a distributed publication or made publicly available online in Japan or a foreign country before the filing of the patent application (Item iii).

Inventive step
If, at the time the application is filed, a person ordinarily skilled in the art could have easily made the invention based on the technology listed in Article 29(1) of the Patent Act (ie, an invention involving the prior art or that is publicly known), the invention cannot be patented (Article 29(2) of the Patent Act).

To reach a decision regarding inventive step, an accurate assessment of the state of the art in the field to which the invention belongs must be made. Further, the points where the invention varies from the prior art must be clearly outlined. While making allowances for the invention’s purpose and effect, a decision will be made regarding whether a person skilled in the art could have easily made the invention by altering the prior art.

Industrial applicability
‘Industry’ is a broad term that includes:

  • manufacture;
  • agriculture;
  • fishing and forestry;
  • mining;
  • commerce; and
  • services.

Medical practice is excluded from the term ‘industry’ and inventions regarding medical treatment are not patentable because they are not industrially applicable. This exclusion stems from the ethical consideration that diagnoses and treatments for humans must not be limited in any way by patents. This legal construction has been adopted due to the lack of statutory provisions expressly denying the validity of patents relating to medical treatment.

However, patents can be obtained for certain aspects of medical treatment, including pharmaceuticals, medical devices and the methods for their manufacture. Article 69(3) of the Patent Act imposes certain limitations on the effect of pharmaceutical patents.

What are the limits on patentability?

Statutory limits to patentability                                  
The Japan Patent Act provide certain statutory limitations to patentability. These limitations include:

  • written description requirements;
  • unity requirements;
  • double patenting restrictions;
  • public order restrictions;
  • filing first restrictions; and
  • inventorship requirements.

Limits to double patenting and simultaneous rights
Like most other jurisdictions, there is no double patenting in Japan, even if an inventor or applicant is the same. Unlike in Germany, patent and utility model rights cannot coexist in the same subject matter.

Time limits to patentability
In Japan, patents are granted for a 20-year period from the date of filing. In limited circumstances, patent term extensions are available for drug patents, subject to government delays in approving drugs for patient use.

To what extent can inventions covering software be patented?

Software inventions are patentable if all steps within the invention are tied to hardware. The hardware that executes each step in the procedure must be explicitly stated in the claims (eg, a program that makes a processor execute steps A, B and C).

While the hardware used must be explicitly stated, it can be described in general terms (eg, a processor, computer or processing device). This requirement is easily met when software is executed by a single device. However, if software is executed by multiple devices, it is necessary to identify the machine or module that executes each step (eg, step A is executed by a server computer and step B is executed by a client computer). This ensures that all steps are executed by a machine, not a person.

To what extent can inventions covering business methods be patented?

Business methods are not patentable in Japan. However, business methods are patentable when a software process is realised using hardware (ie, if all steps of a business method are executed by a machine, not a person, the invention is patentable).

To what extent can inventions relating to stem cells be patented?

Inventions relating to stem cells are patentable in Japan. However, inventions that contravene public order, morality or public health are not patentable. When an invention involves a step that destroys an embryo, it will be rejected under Article 32 of the Patent Act. However, inventions relating to the culturing or differentiation of an established embryonic stem cell line are patentable. This, along with other factors, has led to prolific studies and development in induced pluripotent stem cell technology in Japan. 

Are there restrictions on any other kinds of invention?

Inventions relating to the medical treatment of humans are not patentable. The Patent Office has deemed that medical practice on humans is not industrially applicable and thus cannot be patented. Accordingly, the examination guidelines expressly state that surgical or therapeutic treatment methods concerning humans and methods of diagnosis applied to humans are not patentable.

However, in 2002 the Tokyo High Court issued a controversial decision which implicitly recommended that the protection of medical practice under the Patent Act to be reconsidered. This topic is still being discussed and has reached the Japanese cabinet on several occasions.

Grace period
Does your jurisdiction have a grace period? If so, how does it work?

There is a six-month grace period after initial disclosure. Article 30 of the Patent Act provides a six-month grace period for disclosures made through an experiment, publication, academic presentation or exhibition (eg, a trade fair), or where the invention becomes publicly known against the applicant's will. Such disclosures do not form part of the prior art. This is a much broader exemption than that under European patent law, but is significantly narrower than that under US patent law.

Filing a priority non-Japanese application within the six-month grace period and then subsequently filing a Japanese or Patent Cooperation Treaty (PCT) application may not qualify the application for the loss of novelty exception. Even when claiming conventional priority based on a non-Japanese application that was filed within six months of the initial disclosure, an applicant must still apply for an international PCT patent and request the grace period within six months of disclosure.

Oppositions
What types of patent opposition procedure are available in your jurisdiction?

As of April 2015, Japan reintroduced post-grant opposition procedures similar to those in the United States. Post-grant oppositions and invalidation proceedings may be filed within six months of grant of a patent. After six months, only invalidation proceedings can be filed.

Opposition proceedings are considered ex parte proceedings and participation is limited once proceedings are initiated. Proceedings typically last between six and 10 months. As the time to file an opposition is limited, it can be difficult to monitor the status of a patent application continuously and establish grounds to contest patentability. However, there is no estoppel between opposition and invalidation proceedings. Therefore, even if an opponent loses in opposition proceedings, it can still use the same prior art references and grounds to challenge the patent’s validity.

Apart from oppositions, are there any other ways to challenge a patent outside the courts?

There are two other ways to challenge a patent or patent application outside the opposition system. The first method is via a third-party submission. Third parties can submit written material regarding an invention’s patentability at any time, before or after the patent is granted. If a third party submits material after the patent is granted, it will be included in the file and may be used to challenge the patent in an invalidation proceeding or post-grant opposition. Third-party submissions can be filed while an application is being examined. There is no official fee for third-party submissions and they can be filed anonymously. The downside is that the filer cannot participate in the proceedings.

Patents can also be challenged via invalidation proceedings. Invalidation proceedings in Japan are similar to inter partesreview proceedings in the United States. Because invalidation is an inter partes procedure, an oral hearing is usually held before the appeal board.

How can patent office decisions be appealed in your jurisdiction?

Patent Office decisions may be appealed by filing suit against the Patent Office director before the IP High Court. Suits must be filed within 30 days of issue of the trial decision.

IP High Court decisions may be appealed to the Supreme Court within two weeks of issue of the trial decision.

Timescale and costs
How long should an applicant expect to wait before being granted a patent and what level of cost should it budget for?

On average, Japan patent applications take about a year to be granted after a request for examination is filed. It is also possible to shorten the prosecution period of patent applications by requesting accelerated prosecution at the Patent Office. The Patent Office also has Patent Prosecution Highway (PPH) agreements with many foreign patent offices. On average, applications under accelerated prosecution procedures and PPH take about six months to be granted.

The costs associated with prosecuting a patent application and receiving a granted patent can vary significantly, depending on the number of claims and the technical and legal expertise involved. Therefore, applicants should budget for between Y500,000 and Y2 million. These numbers include translation costs and patent attorney fees.

Enforcement through the courts

Strategy
What are the most effective ways for a patent owner to enforce its rights in your jurisdiction?

Patent owners should consider all available enforcement options, including:

  • litigation;
  • border enforcement;
  • negotiation;
  • arbitration; and
  • criminal proceedings (although these are rare).

The best enforcement strategy for a patent owner to pursue will depend on the facts of the case and the patent owner’s business objectives.

What scope is there for forum selection?

The opportunity for forum selection is limited in Japan; thus, it is not a major concern. Infringement cases are heard by either the Tokyo District Court or the Osaka District Court, depending on the location of the defendant’s domicile.

Pre-trial
What are the stages in the litigation process leading up to a full trial?

The typical stages in litigation include:

  • the issue of a warning letter by the patent owner or exclusive licensee;
  • the issue of a response letter by the alleged infringer;
  • the issue of a complaint and reply brief;
  • the formal first hearing;
  • subsequent informal preparatory hearings;
  • a determination on infringement;
  • an opportunity for settlement; and
  • a determination of damages.

When the court believes that each party’s case has been clearly presented, it will close the preparatory proceedings and set a date for the oral hearing or trial. During trial, each party presents its case as argued during the preparatory procedure. A panel of three judges will hear the case and, once the case is closed, the court will set a date to issue its decision. Decisions are typically rendered between one and two months after the trial.

How easy is it for defendants to delay proceedings and how can plaintiffs prevent them from doing so?

It is extremely difficult for defendants to delay proceedings, as litigation in Japan is fast. That said, defendants can prolong proceedings by increasing the number of issues that the court must address. For example, a defendant can allege that the patent’s subject matter is invalid on multiple grounds or request an invalidity hearing during trial. Plaintiffs can respond by requesting that the allegations be dismissed by arguing that they were made only to delay the proceedings.

How might a party challenge the validity of a patent through the courts in anticipation of a potential suit for infringement being issued against it?

In anticipation of an infringement suit, a party may request that the court issue a declaratory judgment for the non-applicability of the patent, which means that the court will determine whether:

  • the defendant’s conduct infringed the claimed scope of the patent;
  • the patent is valid per the formality requirements; and
  • the plaintiff is the valid patent owner.

In addition, a potential defendant may request a declaratory judgment for right of prior use, if applicable.

During an infringement suit, a party can challenge the validity of a patent as a defence. However, any court decision regarding validity is binding only on the parties to the dispute.

At trial
What level of expertise can a patent owner expect from the courts?

While Japan has 50 district courts, the Tokyo and Osaka District Courts hear all technology-related cases, as they have expertise in this field. The Tokyo District Court has four divisions that specialise in IP cases. The Osaka District Court has two specialised IP divisions. The IP High Court has sole jurisdiction over appeals of Tokyo and Osaka District Court patent decisions.

The district courts and the IP High Court work with research officials who assist them in understanding the technical details of a dispute. Research officials are technical experts and experienced patent examiners from the Patent Office.

The courts have a joint list of experts from which they can appoint expert commissioners in patent cases. This list consists of:

  • professors (64%);
  • patent attorneys (16%);
  • researchers at public institutions (10%); and
  • researchers at private institutions (10%).

Expert commissioners work on a part-time basis, under two-year commitments. They assist judges in understanding the technology involved in each patent case.

Are cases decided by one judge, a panel of judges or a jury?

Patent infringement cases are decided by a panel of three judges at the district court level.

If jury trials do exist, what is the process for deciding whether a case should be put to a jury?

Jury trials are not available for patent cases in Japan.

What role can and do expert witnesses play in proceedings?

Court-appointed experts provide a formal opinion on specific issues raised by the court and can be questioned during the trial. Court-appointed experts first submit a written report, after which judges ask supplementary questions. Thereafter, both parties can question the expert.

Parties usually appoint their own experts. Party experts submit written opinions to the court as documentary evidence and are questioned before the court. While these experts are not court appointed, they can play an important role in complex cases.

The courts have a joint list of experts from which they appoint expert commissioners. While expert commissioners help judges to understand the technology involved in each patent case, they cannot be questioned or cross-examined formally in open court or at trial. Expert commissioners usually do not appear in court. They can question both parties, but the parties cannot question them.

Does your jurisdiction apply a doctrine of equivalents and, if so, how?

In 1997 the Supreme Court endorsed the doctrine of equivalents for the first time in Tsubakimoto Seiko Co Ltd v THK KK. The Supreme Court set out five factors for an accused product or process to be considered infringing under the doctrine of equivalents:

  • The equivalent element cannot be an essential part of the claimed invention. The burden of proof is on the patent owner.
  • The accused product or process must have the same object and effect as the claimed invention (ie, it must provide the same function and result as the patented product or process). The burden of proof is on the patent owner.
  • Someone skilled in the art should have been able to substitute the claimed element with the equivalent element in the accused device in view of the state of the art at the time of infringement. The burden of proof is on the patent owner.
  • The accused product must not be anticipated or obvious in view of the prior art.
  • There must be no prosecution history estoppel.

In 1998, the Supreme Court declared that even if – within the construction as indicated in the patent specification – there is a feature which differs from the patented invention, the product will be considered identical and fall within the technical scope of the patented invention if:

  • the different feature is not essential to the patented invention;
  • the purpose of the patented invention can be achieved by replacing the feature with a feature from the patented invention, resulting in an identical function and effect;
  • a person with average knowledge of the state of the art could have easily suggested such replacement at the time of production of the products;
  • neither product was identical to the technology in the public domain at the time when the patented invention was applied for, and neither product could easily have been conceived at that time by a person with average knowledge of the state of the art; and
  • there were no special circumstances (eg, the products were intentionally excluded from the scope of the patent claim in the application process). 

Is it possible to obtain preliminary injunctions? If so, under what circumstances?

When quick injunctive relief is required, a patent owner can request a preliminary injunction. Preliminary injunctions can be obtained in prima facie infringements if there is prima facie evidence of irreparable harm and proof that an immediate remedy is needed. In Japan, court proceedings for preliminary injunctions are separate from those for damages and permanent injunctions. To obtain a preliminary injunction, a patent owner must establish that:

  • it is the rightful owner or exclusive licensee;
  • the infringer is commercially manufacturing, using, selling or offering to sell the infringing product;
  • the infringing activities are covered by the scope of the patent claims; and
  • an injunction is necessary to avoid irreparable damages.

In addition, the district courts often require plaintiffs to provide a security deposit before injunctive relief is issued. The amount of the security deposit depends on the facts of the case. Generally, security deposits are calculated based on the amount of profits that the alleged infringer is expected to lose due to the injunction and the cost of imposing the injunction (eg, the cost of storing the banned import).

How are issues around infringement and validity treated in your jurisdiction?

Infringement is generally addressed in court proceedings, through negotiation or in some cases arbitration. The Patent Office generally hears invalidity claims. While invalidity claims can also be heard by the courts, any court decision on validity is binding only on the parties to the dispute.

Will courts consider decisions in cases involving similar issues from other jurisdictions?

Judges may find decisions involving similar issues from other jurisdiction to be persuasive, but they are not binding.

Damages and remedies
Can the successful party obtain costs from the losing party?

The successful party may obtain court costs; however, the successful party is not entitled to obtain attorneys’ fees from the losing party.

What are the typical remedies granted to a successful plaintiff?

Typical remedies granted to a successful plaintiff include injunctions and damages awards. Successful plaintiffs are typically entitled to permanent injunctions against the infringing defendant’s use of the invention until the patent expires, as provided for by the Patent Act. Damages are calculated on the basis of a reasonable royalty or lost profits. Infringers may be liable for damages equivalent to royalty as far back as the date of publication of the patent application in Japan.

In cases regarding patent validity, a decision may be rendered regarding the grant or invalidation of a patent, depending on the subject of the claim. Such decisions are binding on the parties of interest.

How are damages awards calculated? Are punitive damages available?

Damages awards are calculated on the basis of a reasonable royalty or lost profits. Three articles of the Patent Act provide the basis for calculating damages:

  • Article 102(1) – lost profits based on the number of infringing products sold, multiplied by the patent owner's profits per unit;
  • Article 102(2) – lost profits based on the assumption that the infringer's profits will be the amount of damages awarded; and
  • Article 102(3) – reasonable royalty.

Under Article 105(1) of the Patent Act, a patent owner can file a motion with the district court to compel an infringer to produce the documents needed in order to determine damages. Infringers may be liable for damages equivalent to royalty as far back as the date of publication of the patent application in Japan. For this to occur, Article 65 of the Patent Act requires the patent owner to prove that:

  • it provided actual notice to the infringer of the pending patent application; or
  • the infringer knew of the published patent application, yet continued its infringement.

How common is it for courts to grant permanent injunctions to successful plaintiffs and under what circumstances will they do this?

The courts will grant permanent injunctions to successful plaintiffs in almost all cases. The Patent Act specifically provides for injunctions. Actual damage, intent and negligence are not required for injunctions to be issued. Thus, the courts will likely issue permanent injunctions where infringement is found. Statistically, the courts rule in favour of the plaintiff 23% of the time.

Timescale and costs
How long does it take to obtain a decision at first instance and is it possible to expedite this process?

Most first-instance cases are decided between a year and a year and a half from the date on which the complaint was filed. These proceedings generally cannot be expedited.

How much should a litigant plan to pay to take a case through to a first-instance decision?

The amount that a litigant should budget depends on the value of the case. For example, if a litigant is being sued for Y100 million, it can expect to pay Y300,000 in court fees and Y10 million in attorneys’ fees (Y2.7 million up front and Y7.3 million as remuneration).

Appeal
Under what circumstances will the losing party in a first-instance case be granted the right to appeal? How long does an appeal typically take?

A losing party can always appeal.

The IP High Court has jurisdiction over appeals of Tokyo and Osaka District Court patent decisions. The IP High Court consists of four divisions, 18 judges and 11 research officials. The court is also responsible for all appeals regarding technology-related infringements and appeals against decisions of the Patent Office Appeal Department. The IP High Court has a so-called ‘grand panel’ system which consists of five judges – the four division heads, plus one judge who oversees the case. This grand panel system helps to prevent the four divisions from issuing inconsistent opinions.

The IP High Court was formed in April 2005 within the Tokyo High Court and was granted limited autonomy and independence. Parties appealing decisions at the IP High Court can:

  • raise new questions concerning facts;
  • produce new evidence; and
  • examine new witnesses.

No juries are involved during proceedings. IP High Court proceedings are a continuation of district court proceedings.

On average, IP High Court proceedings are faster than district court proceedings and often take less than one year.

IP High Court decisions can be appealed before the Supreme Court, but it considers only questions relating to the interpretation of the Constitution and law. The Supreme Court consists of 15 judges. A panel of five judges normally reviews cases.

Appeals before the Supreme Court can be made on the basis that the lower court wrongfully interpreted or otherwise violated the Constitution. Further, parties can petition the Supreme Court for a discretionary appeal. The Supreme Court has discretion over whether to review decisions that seriously violate statutory laws or precedent set by the Supreme Court or its predecessors. 

Options away from court
Are there other dispute resolution options open to parties that believe their patents to be infringed outside the courts?

Dispute resolution options available to patent owners outside of the courts include negotiation, arbitration and customs enforcement.