BL O/090/09 Pro Challenge Ltd 2 April 2009 (unreported). The UK Intellectual Property Office (IPO) has refused an application to restore four patents in respect of which the final opportunity for payment of renewal fees had passed, finding that there was a distinction between an unintended omission and an undesired consequence of that omission.
Multidrive the original proprietors of the patents went into administration in January 2006. The renewal fees of the four patents fell due between June and September of 2006.
Multidrive’s patent attorneys had outsourced the renewal formalities in respect of the patents to a renewals management firm. Multidrive’s patent attorneys notified the administrator of the renewal deadlines. The administrator notified the renewals management firm that it should amend its records to send future renewal notices to him at Multidrive’s offices.
The renewals company did so, but only one of six renewals notices sent to the administrator actually reached him. From that notice, the administrator understood that the fee could be paid after June 2006, during the six month grace period following the date for renewal, with an additional fee.
The administrator sought a purchaser for the patents, with the intention that he would pay the renewal fees for the four patents if a purchaser was found. A purchaser, Pro Challenge, was found but only after the renewal date and all possible extensions had expired.
Pro Challenge submitted, via its patent attorneys, an application to the UK IPO for the restoration of four patents, together with an application for the recordal of an assignment of those same patents from Multidrive Ltd to Pro Challenge.
Pro Challenge argued that the intention of the administrator had always been to renew the patents, but that he had been prevented from doing so by a lack of immediate funds. Under Section 28 of the Patents Act 1977, the comptroller shall restore a patent on payment of the renewal fee and any prescribed additional fee, if he is satisfied that the proprietor of the patent intended to pay the renewal fee within the prescribed period.
The IPO hearing officer held that, despite an attempt to establish the final date for renewal of the patents, the administrator, who was not a patent expert, was aware only that the fees would finally become due sometime after June 2006. Whilst he accepted that the administrator had a general underlying intention to renew the patents in suit, following Anning’s Application  EWHC 2770, an underlying intention will not necessarily be followed by a finding that the failure to comply was unintentional.
The hearing officer held that the knowledge that deadlines existed for the renewals meant that the administrator was conscious that the eventual lapse of the patents was inevitable. As such, the failure to pay the renewal fees within the prescribed period could not have been unintentional.
The hearing officer held that what was unintentional was the consequence of the administrator’s failure to pay the renewal fees, i.e. the lapse of the patents but that, following Anning, it was clear that there was a distinction between the unintentional failure to do something and an unintended consequence of that failure. Accordingly, he could only take into account the lack of intent to do the thing itself and as such, the administrator’s intent in respect of the consequences of that failure was irrelevant.
The courts and the IPO have been consistent in finding, time after time, that very good reasons are needed to justify an application to restore lapsed patents to the register. Whilst this may seem unfair to the patentee which has lost a valuable right, it is less unfair when considered from the point of view of its competitors, which may have noted the lapse of the patent and commenced preparations to exploit the technology themselves.