On March 12, 2014 the Russian President signed Federal Law ¹ 35-FZ amending the Civil Code, including its Part IV, “Rights to the Results of Intellectual Activities and Means of Individualization”.
Part IV of the Civil Code is focused entirely on intellectual property and was brought into force in 2008. It represented the first attempt to fully consolidate all intellectual property laws. The current amendments are intended to refine Part IV to take account of the lessons of five years of judicial and practical consideration. The revisions will generally come into effect on October 1; however, some amendments will be delayed until January 1, 2015 namely:
- amended Article 1363 “Duration of Exclusive Rights to Utility Models, Industrial Designs and Inventions”; and,
- new Article 14061 “Liability for Infringement of the Exclusive Right to Inventions, Utility Models and Industrial Designs”.
These will be described more fully below.
Patent applications filed prior to the effective date of the new amendments, as well as reviews of Rospatent decisions and pending administrative proceedings will be examined in accordance with the previous legislation.
This review covers only those provisions of the new law which are focused on Chapter 72 of the RF Civil Code «The Patent Law». Although 49 out of 63 articles of this Chapter have been amended some of the amendments are not of crucial significance and, as such, are not encompassed by this review.
- Patentability Requirements
The essential requirements for patentability have been amended in respect of all three categories of patents: inventions, utility models and industrial designs.
Sufficiency of disclosure - Article 1350 of the Civil Code currently requires three conditions for patentability of inventions: novelty, inventive step and industrial applicability. The new amendments introduce a fourth requirement: sufficiency of disclosure. The new requirement will be assessed by examiners in the course of substantive examination of applications (Article 1386 of the Civil Code).
Insufficiency of disclosure will be a valid ground for both refusing an application and revoking an issued patent (Article 1398). “Sufficiency” means, as of the filing date, “to disclose the essence of the claimed invention in the application documents in a manner sufficient for implementation of the invention by a person skilled in the art”.
Prior to this amendment, sufficiency of disclosure was a practical but not a statutory requirement. It was required as a matter of practice, procedure and regulation under the legal requirement for “industrial applicability”. However, the legal right to raise an objection of industrial applicability premised upon insufficiency of disclosure was often in doubt. To address this doubt it was decided to legitimize sufficiency as a substantive rather than a procedural requirement for patentability.
As regards critical dates it should be noted that while novelty and inventive step are determined as of the priority date, the assessment of sufficiency of disclosure is to be made on the basis of information contained in the specification as of the filing date (international filing date for PCT applications and the date of actual filing for applications filed directly with the Russian Patent Office).
Introduction of this new requirement could have a significant effect on the substantive examination of applications. However it is not clear how rigidly the new provision will be applied in actual practice for example, as regards new data. Until now, an applicant was entitled to submit additional data confirming the feasibility of inventions even after the filing date. Once the new law is in force, this practice may or may not be permitted.
Prior Art -What qualifies as prior art for the evaluation of novelty of an invention has been expanded to include industrial design applications (except for previously filed applications for inventions and utility models to which the new rule does not apply). This is in line with amended Article 1379 which provides for the possibility of converting an invention patent application into a design patent application, and vice versa.
Grace period - The six month grace period for filing an application in Russia following the disclosure of information about the invention by the inventor, applicant or other affiliated parties now also applies to the public disclosure of the invention at exhibitions. The grace period is tied to the actual filing date in Russia and not to the priority date. As to what constitutes an exhibition this is not clearly defined.
2.2. Utility Models
Protection for utility models was introduced in Russia under the Patent Law of 1992. The public interest objective in introducing utility models was to expeditiously grant patents without substantive examination so as to encourage development of small businesses and innovation in an emerging economy. Unfortunately, while the regime did deliver some public interest benefits, the system was manipulated for undesirable purposes. Utility model applications were often inappropriately used as a means for quickly obtaining a patent to use as a sword against others. Because there was no examination for novelty or inventive ingenuity, troll-like applicant would apply for patents, for subject matter that was very likely already in the public domain. They would then try to assert those patents against bona fide business entities legitimately using the technology, e.g., manufacturers of products. In some cases the target was the Russian distributor of products of a foreign innovator who had not patented the invention in Russia.
The new amendments seek, by various means, to curb these abuses:
Prior art - currently, prior art for evaluation of the utility model’s novelty is limited to published information about any means having the same intended use as the claimed model. However, amended Article 1351 expands the meaning of prior art so that it includes any information that became publicly available before the priority date of the utility model, regardless of the technical field to which it applies. Moreover, under the previous definition of prior art, only information available in Russia regarding use of the means having the same intended purpose was considered. This restriction will be removed such that prior art will include information that was publically available anywhere in the world. Moreover, prior art will include earlier filed invention patents and also design patents;
Substantive examination – in addition to a broadening of the definition of prior art, there will now be substantive examination of applications. Previously, the only form of examination was clerical in respect of filing formalities. Substantive examination will be carried out in order to verify compliance with both the requirements of subject-matter and patentability (Article 1390 of the Civil Code);
Literal Infringement only - the scope of protection granted to a utility model will be limited. Under the previous legislation a utility model patent was deemed to be infringed if the article possessed features equivalent to the features included into the utility model claims. Under amended Article 1358, infringement based on the “doctrine of equivalents” with regard to utility models will be abolished.
These amendments are directed at positioning utility models where they were intended to be in terms of the public interest and will hopefully minimize the forms of abuse that have occurred in recent years. It is anticipated that the number of filings will also decrease.
2.3. Design Patents (industrial designs)
Article 1352 of the Civil Code, which sets out the patentability requirements for an industrial design, has been significantly amended as follows:
Subject-matter - the requirement that the design be an “artistic design solution” has been deleted from the definition of industrial design. That requirement had conflicted with the existing practice of protecting as industrial designs those articles, which were not “solutions”, e.g., printed matters, or fabric designs;
Novelty and originality - these conditions remain. The definition of originality has been revised to read: “articles not known as of the priority date of the industrial design, said articles having similar intended use and appearance, making the same general impression as the claimed industrial design”;
Examination - examination of industrial design applications will take into consideration not only design applications having earlier priority, but also earlier applications for inventions, utility models and trademarks;
Grace period - the grace period for prior disclosure of the industrial design, including the public display at exhibitions, is being extended from 6 to 12 months;
Excluded subject-matter - the previous prohibition against protection for objects of architecture as industrial designs, and objects of an unstable fluid, gaseous, free-flowing or similar substances has been deleted.
Written description - amendments to Article 1377 cancel the requirement to provide a written list of the essential features of the industrial design. This is a significant amendment. Both the requirements to obtain a design and the approach to assessing infringement will change: no longer will regard be given to a written description setting out the essential elements of the design. What will govern the scope of the monopoly is the solely the image.
These amendments will considerably improve the efficiency of preparing, filing and examining design applications. Until now, the time and detail associated with the preparation and review of the written description of essential features had been a time-consuming and costly task.
- Terms for Utility Model, Design and Invention Patents
3.1. Utility models and industrial designs:
The length of the term for patents for utility models and industrial designs has been modified as follows (Article 1363):
Utility models: 10 years (previously it was possible to extend this term for a further 3 more years);
Industrial designs: the maximum term of 25 years remains however there are more frequent renewal requirements. Previously, the initial term was 15 years extendable once for an additional 10 years. Under the new law, the initial term is 5 years extendable every five years for a total of 25 years.
3.2. Patent term extension for pharmaceuticals etc:
The amendments change the procedure for extension of the 20 year basic term with respect to patents that relate to a pharmaceutical, pesticide or agrochemical patent. In particular:
- the patent for which extension can be sought must pertain to the product per se;
- in the context of a patent term extension request, the Patent Office can now issue an Office Action requesting the patentee to provide additional materials. The term for filing a response to such an Office Action will be 3 months extendible for up to 10 months;
- in contrast to the existing patent term extension procedure which resulted in the grant of a term extension for the existing patent, under the new law a supplementary patent will be granted whose scope will be restricted to the approved product (drug, pesticide or agrochemical) on the basis of which the patent term extension has been obtained;
- the law stipulates that a supplementary patent can be invalidated on the same grounds as regular patents.
This amendment will likely create some uncertainty in regards to supplementary patents in revocation and infringement proceedings. As previously mentioned, under the new law, one of the grounds for invalidation of a patent (Article 1398 of the RF Civil Code) is the failure to disclose the essence of the invention in sufficient detail for its implementation in the patent application as of its filing date. If, for example, a patent is granted for a group of chemical compounds characterized by Markush claims, and an approval was received for a specific compound from the group for which a supplementary patent is granted, in the situation where the original specification contained no examples for preparing this particular compound, it would likely be possible to contest the supplementary patent on the ground of insufficiency of disclosure.
Another potentially problem could occur with the possibility to contest a patent because of the presence of features in the claims which were not disclosed in the original specification. If, in the example in question, the compound for which a supplementary patent is granted had not been explicitly supported by the original specification under which the basic patent was granted, the claims in the supplementary patent would be vulnerable to attack on the added matter ground.
Since the law-makers most likely foresaw that these new amendments might give rise to new questions, they also resolved that the Patent Office should have the power to issue new regulations from time to time regarding practical implementation of the new laws.
- “Use” as a New Category of Invention
Article 1350 of the Civil Code limits the range of patentable inventions to two types of technical solutions: a product (including a device, substance, or biological material) or a method.
The Russian Patent Law of 1992 had previously recognized the patentability of inventions for a new “use of a previously known device, substance or method” (sometimes referred to as a “second use”). However, the law at that time did not expressly acknowledge the scope and enforceability of use patents that created this right. This posed problems when infringement was being alleged. Therefore, in 2003 the law-makers removed “second use” claims from the list of patentable inventions. Nevertheless, despite this removal, the Patent Office continued granting patents having “use” claims.
The new amendments stipulate protection for not only the “second use”, but also the “first” use, i.e. use of a new device, substance and method. Therefore, the set of claims pertaining, for example, to a new substance may contain claims related to the substance per se and to its use. Thus, the following combination of claims is possible:
- substance A;
- a method for treating disease X comprising administration of substance A to the patient; and,
- the use of substance À for (preparation of a drug for) treating disease X.
The new law now recognizes that “use for a certain intended purpose” is subject to protection.
The amendments stipulate the scope and enforceability of use claims. The scope of “a use of product A for treating disease X” claim is comparable to the product claim per se, viz. the exclusive right to import into Russia, and the manufacture, sale or otherwise putting into civil circulation of the product, provided, however, that those acts can be shown to be associated with the intended use covered by the patent, i.e. for treating disease X.
Accordingly, if for example a third party puts into circulation a drug comprising substance A, and the drug label indicates that it may be used to treat the disease X, then the patent claiming use of product A for (preparation of a drug) for treating disease X will be deemed to be infringed. On the other hand, if a third party imports chemical substance A into Russia, and the customs documents do not show that it is meant for treating disease X, the patent would likely not be infringed by reason of such importation.
- Dependent Invention, Utility Model, Industrial Design
In recent years, Russian courts, even the higher courts, found otherwise infringers to be not liable if they were the holder of a patent or utility model with a later priority. The reason was based upon statutory interpretation of the Civil Code provisions which were read to allow a patentee to commercialize the patented product notwithstanding that such commercialization might infringe an earlier third party’s patent.
This practice, which clearly conflicted with the principle of the “senior right”, encountered harsh criticism from patent owners and intellectual property professionals who recognized that this statutory interpretation was completely at odds with basic patent principles. As a result, the new amendments introduce into the Civil Code special Article (1358) «Dependent inventions, utility models, industrial designs».
Pursuant to this Article a patent is a dependent one, if its use entails use of another invention, utility model or industrial design protected by a patent having an earlier priority date.
It is noteworthy that use of the invention will be found to occur if the object of the subsequent patent (product or method) uses all features stated in an independent claim of the senior patent with due account being taken for equivalents. Use of a senior utility model patent will occur if a device (since only devices can be the subject matter of a utility model patent) uses all the features stated in an independent claim of the senior utility model patent per se (without regard to equivalents).
An industrial design will be deemed used in the article, if the article contains all of the essential features of the industrial design.
The new law expressly defines dependency of inventions related to the products use in regards to an earlier patent granted for inventions pertaining to a product.
The new law also specifically prohibits the use of dependent inventions, utility models or industrial designs without the consent of the owner of the senior patent upon which the subsequent patent is found to be dependent.
- Filing and Prosecution of Applications
There are various amendments as regards prosecution of applications. These include:
- Sufficiency of disclosure – as mentioned above there is a new requirement for the description (specification) of an invention or utility model (Articles 1375 and 1376 of the Civil Code), to be sufficient to permit “a person skilled in the art” to implement the subject-matter of the invention. The concept of “clarity” is also introduced for claims in inventions and utility models.
- Grouping of Utility Models - the possibility of filing one application for “a group of utility models” has been removed.
- “List of essential features” – under Article 1377, the requirement for a design application to contain a “list of essential features” has been eliminated, as discussed above.
- Amendments to applications – there are major changes associated with the applicants right to amend an application (Article 1378 of the Civil Code):
- it will only be possible to supplement, amend and correct the application documents in response to the request of an examiner expressed in an office action (except for information about inventors or applicants);
- only a single voluntary amendment of claims upon the initiative of the applicant will be allowed after receipt of the Information Search Report by the applicant.
- a new ground for rejection of additional materials by examiners is to be introduced: if the additional materials teach a technical effect promised by the invention or the utility model and that effect is not connected with the effect disclosed in the original documents, then it will be rejected.
- Third Party Opposition - the most fundamental amendment relates to Article 1386 which provides that, after publication of an application, a third party may furnish written submissions as regards non-compliance of the claimed invention with basic patentability requirements. Those submissions may be taken into consideration by the examiner but the third party will have no right to participate in the process.
- Office action deadlines - deadlines for responding to office actions will be 3 months and will commence, not from the date of receipt of the office action by the applicant (which was until now the case) but from the date of issuance.
- Voluntary abandonment – voluntary abandonment of an application upon the initiative of an applicant, as previously stipulated by Article 1387 of the Civil Code, has been abolished. An application will be deemed abandoned solely upon the decision of the Patent Office.
- Revival of an expired term - for revival of a missed deadline in prosecution that has elapsed (Article 1389) it will be sufficient to provide sound reasons for the failure to meet the deadline, and it will not be required to submit documents to prove that the reasons were valid.
- Invalidation of Patents
Article 1398 contains some noteworthy provisions with respect to invalidation:
Insufficiency of Disclosure - as discussed above, the list of grounds for contesting granted patents for inventions or utility models has been expanded such that there is a separate ground of “non-compliance” of the application, as of its filing date, to disclose the essence of the invention or utility model in a manner sufficient to allow for implementation of the invention or utility model by the person skilled in the art.”
The law makes it possible to challenge the patent if an entity is able to show its legal standing. Most likely, legal standing would be recognized for those entities against which a patentee has alleged patent infringement.
Conversion from Invention to Utility Model – For invention patents there is both a novelty and inventive step requirement but for a utility model the main requirement is novelty. No inventive step is required. With the new amendments, provision is made for the judicial authority to convert an issued invention patent into a utility model patent in the course of a revocation proceeding provided that the patent term has not exceeded 10 years (the life span of a utility model). In such cases, the utility model patent will be granted for the remainder of the available term and the invention patent will be invalidated in full. This outcome is only possible if the claimed solution pertains to devices and otherwise complies with the patentability conditions for utility models. Previously it had always been possible to convert an invention application into a utility model application but it was not possible to convert an issued invention patent into a utility model patent.
Patent revocation proceedings at the first instance -The Chamber for Patent Disputes is no longer designated as the authority, at the first instance, for accepting and considering requests for revocation of issued patents. The competent authority will now be the Patent Office itself. This change is more one of form than of substance as the Patent Chamber was an administrative body within the Patent Office in any case. Time will tell as to whether this change will affect day to day practice or not.
- Patent Infringement and Liability
Doctrine of equivalents - A new amendment narrows the ambit of the doctrine of equivalents. Under Article 1358, the law as it was before the recent amendment provided as follows:
3. An invention or utility model shall be deemed used in a product or processif the product contains or the process involves each feature of the invention or utility model stated in an independent claim contained in the claims for the invention or utility model, or a feature equivalent thereto that has become known as such in this artprior to performance in respect to the respective product or process of the actionsprovided for by Paragraph 2 of the present Article.
The amended provision reads as follows:
3. Inventions or utility models are considered to be used in the product or method, if the product comprises and the method uses each feature of the invention stated in the independent claim of the patent claims, or a feature equivalent to it and that has become known as such in this art before the priority date of the invention.
Under the previous provision, a person could be found to be infringing by reason of the use of an equivalent feature to one set out in a claim if the equivalent feature was known at the time the infringing act began.
Under the new provision, the feature may only be deemed to be an equivalent one if the feature was known as at the priority date of the patent in issue.
The narrowing of the scope of what may qualify as an equivalent feature will serve the public interest in giving more certainty in the assessment of freedom to operate.
Prior use right – The existing law provided that a person who began, in good faith, to use the subject matter of an invention before the priority date for a patent can continue to use the invention even if a patent issues in favor of a third party. This provision has been amended so as to allow for a prior use right that includes not only solutions identical to the patented invention but also to solutions comprising equivalent features.
“Fault” and infringement – The Civil Code uses the term “fault” in association with a defendant’s acts of infringement. Likely this is understood to mean both the act of infringing coupled with the intent to carry out that act. Prior to the recent amendments, the operative provision had said that the absence of fault of an infringer would not excuse him from the obligation to cease the acts of infringement viz. an injunction would be granted regardless of fault. It was not clear, under the former provisions, whether an infringer could be absolved from an obligation to pay damages or monetary compensation if s/he was not shown to have been at “fault”.
The amendment appears to clarify that the infringer is also liable to pay monetary compensation under the Civil Code regardless of “fault”: the only exception being acts of God and circumstances beyond control.
The amendment further provides that an intermediary, such as a distributor or retailer, who, without fault, sold infringing goods, can claim relief from its supplier for any compensation the distributor/retailer might otherwise have had to pay in a legal proceeding. In practice, to prevent such a claim, the owner of the intellectual property right can send a detailed cease and desist letter to the intermediary. From that point forward the intermediary cannot claim that its continued acts were “without fault”.
Joint and several liability - Article 1252 has been supplemented with the provision of joint and several liabilities of multiple parties, if one (common) infringement of right has been committed through their common actions.
This amendment may serve as the basis for introducing the principle of “indirect infringement of patents”, e.g., when a patent is granted for the article as a whole and a potential infringer does not produce the entire article but supplies component unit used in the assembly of the whole article. In this instance, infringers may be both the manufacturer of the whole article and the supplier of the component units. In the context of the Law, common actions shall mean either affiliation of those parties or their contractual relations for common activity.
Reasonable compensation – With effect from January 1, 2015 a patentee in an infringement action relating to patents for inventions, utility models or designs will be entitled to claim, in the alternative, payment of compensation or damages: (i) in the amount from 10,000 to 5 million Rubles (about $300 to $150,000); or (ii) twice the value of the right of use (market value of the lawful right to use a patented invention, utility model or industrial design).
- Assignment and License
The new law introduces major changes associated with the requirement to record assignments and licenses.
The amendments facilitate recordal of assignments and licenses under Article 1232 of the Civil Code. Instead of submitting the actual patent assignment agreement or a licensing agreement for recordal, an applicant may optionally submit to the Patent Office one of the following:
- a “notice of disposal” or “notice of license” of the exclusive right signed by both of the parties to the agreement;
- a notarized extract from the agreement; or,
- the agreement itself.
As before, it will be important to ensure that the parties and the relevant intellectual property rights are correctly identified and that there are no inconsistencies in that regard as between the assigned or licensed rights, the owners named in the Patent Office records and the purported assignor or licensor.
Article 1236 also affirms that an exclusive licensor is not be entitled to use the result of intellectual activity himself to the extent that the right was granted to the licensee under the exclusive licensing agreement.