BREXIT and IP. How will the outcome effect YOUR business?

Posted by:


With just one week left to go, the BREXIT referendum is nearly upon us, but have you given any thought to how a BREXIT might affect the IP of your business?

The UK IP system is currently highly integrated with EU legislation, and UK businesses can currently enjoy EU-wide protection for both trade marks and designs via the EU IPO so a BREXIT could have a significant effect on your current IP.

Here are 5 consequences that a BREXIT might have on your IP:

  • The European Patent Office (EPO) is not an EU body; the UK would remain as a contracting state of the EPO and UK businesses would still be able to file a European Patent application using a UK-based European Patent Attorney.
  • However the EU IPO (which grants EU-wide trade mark and design registrations) is an EU body. Any existing EU Trade Mark Registrations and EU Design Registration would no longer cover the UK after BREXIT. We hope (with crossed fingers!) that in the event of a BREXIT that there would be transitional provisions to allow holders of these rights to extend the protection to a UK national right. But this isn’t guaranteed. And even if transitional provisions are put in place there would inevitably be additional costs for any extension needed.
  • After a BREXIT, although UK businesses could still obtain EU-wide trade mark and design registrations via EU IPO, there would need to be separate protection for the UK, which would increase costs. Further, most UK based attorneys may not be able to represent businesses before the EU IPO.
  • The long-awaited EU Unitary Patent and Unified Patent Court (UPC) would be thrown into confusion with a BREXIT. The legislation requires the UK to be a signatory before it comes into effect. Would the UK still sign if there is a “Leave” vote next Thursday? And if we don’t sign the delay to the Unitary Patent and UPC is likely to be considerable. It’s clear that the UK would lose the Central Division Court promised for London, with a loss of significant potential prestige, not to mention jobs.
  • The UK IPO is very highly regarded in international and global IP circles – will the influence we can bring on a global stage be diminished? Will there be an outflow of IP lawyers and attorneys who would like to retain their current EU-wide qualifications and to continue to practice before the EU IPO and (in due course) before the UPC? If the best UK-based IP lawyers would rather be EU-based after a “Leave” vote, how will that leave UK business?

If BREXIT occurs no knows for sure what will happen, especially in IP, but what is certain is that those businesses who are reliant on IP are in for unpredictable and possibly rough few years.

Patent Strategies – Some Thoughts

Posted by:

An area of IP that is too often overlooked is that of IP strategy. A company with some level of IP – and every company does have some! – should invest a little time in thinking through their IP strategy. Otherwise the likelihood is that the decisions regarding IP are made without sufficient regard to what the realistic objectives are. I say “realistic” because whilst worldwide coverage may be eminently desirable, is it achievable given the costs? Or even desirable if overseas markets are too small to be worth the cost? Here are some thoughts to ponder:

  • Right at the very start think about how much money the IP is likely to cost. Over what timescale?
  • What are your realistic market plans over the lifetime of the product?
  • Where are the really key markets in your industry?
  • How quickly do you need to achieve grant?
  • What is the risk of copycats? Do you need IP insurance to mitigate that risk?

And finally, the most key point of all, don’t leave IP decisions right to the last minute. Give yourself time to think these questions through before your hand is forced by an imminent and pressing deadline.

Can a biscuit be a trade mark?

Posted by:

Kit KatDo you only ever think of trade marks being words or pictures? Actually the possibilities are much, much wider. Essentially a trade mark is any “sign” capable of distinguishing your goods or services from those of any other trader. So, for instance, a trade mark can include a shape.

With over 1 billion Kit Kats being sold every year, Nestlé has applied to register the 3D shape of its famous 4 fingered bar as a UK trade mark. Cadburys have opposed the registration and the question of whether the shape of the bar is a trade mark has escalated beyond the English High Court, with questions referred to the European Court of Justice (ECJ). Nestlé have argued that the 3D shape of the four fingered bar has acquired a distinctive character. If so, that distinctiveness would allow the shape to be registered as a trade mark, allowing an indefinite monopoly. But the Attorney General has published his opinion that it is not sufficient for the shape to be recognised and to be associated with Nestlé when other trademarks (such as the word mark “KIT KAT”) are also present. Rather, the shape alone must be capable of fulfilling the function of identifying the origin of the goods by itself. Whilst 90% of consumers surveyed recognised the bar, in real life the bar is hidden by the wrapper – and the wrapper bears the trade mark “KIT KAT” prominently. So would consumers really rely on the shape of the bar alone to identify the origin of the goods?

There’s another issue being hotly argued here too; is the mark being registered merely a shape which comes from the goods themselves and/or a shape needed to obtain a technical result? If so, the application should be refused. The ability to “snap off” a finger of a Kit Kat is due to the grooves in the product. Are these grooves a “technical result”? And arguably the angle of the sides and grooves of the product and its slab-like rectangular form are due to its method of manufacture. The Attorney General considers that trade mark protection should not be given for either technical solutions or functional characteristics and that if at least one of these grounds is “fully applied” to the shape, then that would prevent registration.

The matter is still with the ECJ, who do not need to follow the advice of the Attorney General (although they often do), but for now it looks as though the feature which is the most distinguishes a Kit Kat from other products – the ability to snap off a finger – could prevent the shape from being registered as a trade mark.

The Nagoya Protocol

Posted by:

Nagoya – What every UK Biotech company should know

The Nagoya Protocol is here to stay and its requirements will fundamentally affect biotech research in the UK.

Arising as part of the implementation of the Convention on Biological Diversity, with aims and objectives that are laudatory, in practice Nagoya may be emerging as a very heavy sledge hammer to crush a very puny nut.

The Convention on Biological Diversity (CBD) intended to put an end to ‘biopiracy’, the unfair appropriation of genetic resources and traditional knowledge from developing countries by research and commercial activities elsewhere. A CBD press release stated, “The entry into force of the Nagoya Protocol will provide greater legal certainty and transparency for both providers and users of genetic resources, creating a framework that promotes the use of genetic resources and associated traditional knowledge while strengthening the opportunities for fair and equitable sharing of benefits from their use.” It would be hard to argue against this objective, but the effect of the Nagoya Protocol on the biotech industry in its signatory countries is causing some concern.

The Nagoya Protocol entered in force on 12 October 2014. The EU is a signatory and so the effects of Nagoya will resonate within the UK through the implementing EU legislation, Regulation no. 511/2014 which will apply from 12 October 2015. The Nagoya Protocol requires that informed consent is obtained from the country of origin of a genetic resource for research or commercialization involving that resource. The Protocol envisages that the agreement for that consent will be on mutually agreed terms and will provide for “benefit sharing”, not just in terms of a royalty, but possibly also including the sharing of R&D results. Exactly how this will work out in practice is somewhat unclear. What is clear is that compliance with Nagoya will impose a significant administration burden on all biotech research involving a non-human genetic resource. And there is a requirement for that information to be retained for 20 years after the end of the period of utilization. Further, there are significant levels of penalties for non-compliance – both civil and criminal sanctions can be imposed, with the maximum levels being a fine of £250,000 and up to 2 years in prison. And, despite the Nagoya Protocol now being in force, there is a lot of confusion about exactly what is required since the implementing regulations are still being drafted, even though the 12 October 2015 date for the application of EU Regulation 511/2014 is fast approaching.

However, one issue is abundantly clear: there is a low level of understanding within the UK biotechnology industry of what needs to be done.

So here are our practical tips about what you should be doing now:

Audit all of your genetic resources:

That’s DNA, plasmids, bacteria, viruses, cells, tissue samples. They are all covered by the Nagoya Protocol. Document each sample noting in particular whether it is:

• a purely human sample (if so it is not covered by the Nagoya Protocol); or
• a sample which was obtained before 12 October 2014 (if so it is not covered by the Nagoya Protocol providing you have evidence of its date of acquisition).

Anything left falls under the provisions of the Nagoya Protocol and you will need to show due diligence in finding its country of origin and obtaining an Access and Benefit Sharing Agreement with that country.

Start putting in place a system for genetic resource administration

At the very least you will need a robust and reliable system able to record the date and place of access and a description of each genetic resource, together with information on the source of the genetic resource, of any subsequent users, plus copies of any benefit sharing agreement, certificate of compliance and access permits.

Where possible consider obtaining future genetic resources from UK sources

If that’s not possible, consider sourcing from a country which is not a party to the Nagoya Protocol (such as US). A further alternative is to source through a registered culture collection as then the regulatory burden will be eased somewhat. But ‘registered’ here means registered under the provisions of Nagoya – so check whether the culture collection you’re intending to use is registered under the Nagoya Protocol.

Register with the ABS-CH

The website address is Registration is free and easy and there’s a wealth of information about the Nagoya Protocol and the various signatory countries.

Keep an eye out for further updates

We will be posting about further updates as more becomes known!

IP Insurance: Is it worth the money?

Posted by:

Intellectual Property is central to protecting the ideas, creativity and brands. But many businesses fail to take action to protect such valuable assets. Their reason?

There’s no point, we wouldn’t be able to afford a court action to stop an infringer anyway.

But there is a solution – IP Insurance. Like any insurance, you pay a premium to hedge against the possibility that you might – one day – need to cover a large expense, such as legal costs in a court action. Like any insurance it pays to shop around. Since IP Insurance is dealing with larger sums than (for example) your house insurance, the benefits of shopping around (or the disadvantages of not doing so) are magnified.

Some IP Insurance providers offer protection specific to the UK Intellectual Property Enterprise Court (previously the Patents County Court), for example. It’s a cheaper, simpler policy and looks attractive. After all you could always choose to pursue an infringer in the Intellectual Property Enterprise Court – couldn’t you? Well may be not. What if the infringer – and all infringements – occur in Scotland? The Intellectual Property Enterprise Court only has jurisdiction for England and Wales. What if you’ve got more than UK rights? For example, a European patent application? Or a US application? This type of policy probably won’t be enough to covers such situations either. So know your market. And know the extent of your patent coverage. No business needs “worldwide” protection, for the simple reason that no business has patents in every single country of the world. And if one or more of your patent applications is pending, you can’t enforce in many countries until grant. So perhaps consider extending the geographical extent of the policy as and when your rights proceed to grant.

Some insurance policies focus only on patents and in particular on infringement of your patents. Others offer a broader IP perspective and are prepared to insure against litigation for infringement of registered designs and trade marks. Some will also offer protection in the event that you need to defend yourself against a claim for infringement of someone else’s IP rights. Make sure you understand the extent of the policy – perhaps check out its scope with your patent attorney or IP lawyer. In short, don’t guess, get some advice.

Be aware that most insurance policies will cap the amount of money being paid out for a legitimate claim – and that patent infringement actions can be expensive. Make sure that you select a cap that will be enough for your needs.

Another point to consider is whether to select a policy that would help with the costs of arbitration or mediation of an IP dispute. These alternatives to litigation are growing in popularity and are much more cost effective.

You’ll need to invest some time looking through the different options to find one that most closely matches your needs. Compare more than the price and read the small print. Because IP Insurance policies can be very, very different in their scope.

But be reassured. The mere fact that you have IP Insurance can be enough to make many potential infringers back down.

New US Patent Office Guidelines

Posted by:

The USPTO has issued new Guidelines for US Examiners to use in order to determine whether an invention is patent eligible (i.e. is of a type which is not barred from being patentable). These Guidelines are effective from 16 December 2014 and address concerns raised following the US PTO’s change in practice (subsequent to recent biotech Supreme Court patent decisions) which effectively denied patentability to almost any claim including a natural product.

In the new Guidelines, a 2-step analysis is conducted.

First, the Examiner should ask whether the claim is for a process, machine or composition of matter. If the answer is “no”, then that claim covers subject matter which can’t be patented. If the answer is “yes”, the Examiner moves onto question 2.

Second, the Examiner should determine whether the claim covers, in whole or in part, a “judicial exception under s101″. In other words, does the claim cover a law of nature, a natural phenomena and/or an abstract idea? If none of these exceptions are included, the claim is patent eligible. However, if the claim does cover any one of these exceptions then further analysis is needed, and the Examiner must look to see whether the claimed subject matter amounts to SIGNIFICANTLY MORE than the judicial exception.

Under these new Guidelines, a claim covering a natural product should be compared to its naturally occurring counterpart in order to identify any characteristics which are markedly different in terms of function, structure or any other properties. Such differences could be in terms of biological or pharmaceutical function or activity, or could be in terms of function, structure or any other property. For example a cDNA is considered to be markedly different to the intron-containing natural gene and could therefore be patented. Helpfully, the Guidelines state that an isolated or purified product will be patent eligible where the step of isolation/purification gives a resultant change in characteristics leading to a marked difference from the natural counterpart.

Claims to a combined product (the example given in the Guidelines is a combination of Lactobacillus bacteria and milk) should be analysed as a whole rather than the separate components being individually analysed. This approach should be helpful to patent applicants.

Broader claims considered to “tie-up” a natural phenomena will be analysed more closely, but more focused (narrower) claims will allow a stream-lined eligibility review. Also, claims to a diagnostic process or method are likely to be deemed patent eligible if the claim is sufficiently focused on the practical application.

These new Guidelines look to be a relaxation of the previous draconian approach and we will watch further developments with interest.

The USPTO notes that the Guidelines will be revised as case law develops and there is the opportunity to comment on them until 16 March 2015. You can read more here: USPTO 2014 Interim Guidelines.

Biotech Patent update on human embryos

Posted by:

The EU Court of Justice held on 18 December 2014 that a non-fertilised human ovum is not regarded as a human embryo unless it has an inherent capacity to develop into a human being. The fact that the ovum had been parthenogenetically-activated and had commenced a process of development was insufficient for it to be caught by the EU Biotech Directive and hence excluded from patentability.

The decision overturns the part of the Brüstle judgement (C34/10) of 18 October 2011 where the court held that an unfertilised human ova stimulated by parthenogenesis would be deemed to be capable of developing into a human being in the same way as a fertilised ova, the court accepting further scientific knowledge that such organisms do not have the capability to develop into a human being. The court did, however, specify that should an ovum have the inherent ability to develop into a human being, it would be treated in the same way as a fertilised ovum at all stages of its development.

The decision offer a glimmer of light to research in stem cell therapy.

Rubik’s cube – a 3D Trade Mark!

Posted by:

The EU General Court has upheld the decision of OHIM’s Board of Appeal  to reject an action filed by Simba Toys GmbH & Co to invalidate a Community Trade Registration for a 3D (shape) mark shown as

Rubik's cube

in respect of three-dimensional puzzles.

The Court found that the mark as shown above did not consist exclusively of the shape of goods which is necessary to achieve a technical effect. Rather, the Court noted that the shape, by itself, could not show rotational ability and in particular that an internal rotating mechanism cannot be inferred from the contested mark. The grid structure shown in the mark was found to be a decorative and imaginative element and to play an important role as an indicator of origin. Although the grid structure also had the effect of visually dividing the surface of the cube into nine equal square elements, that was not considered to be a technical function. Further, a cube in a grid structure was held to be inherently distinctive.

You can read the full decision here.

New Rules for Genetic Researchers

Posted by:

12 October 2014 saw the Nagoya Protocol coming into force. Intended to ensure the fair sharing of genetic resources between users and providers, the convention requires that there is a Prior Informed Consent (PIC) of the “country of origin” and also Mutually Agreed Terms (MAT) for use of the benefits arising from that access. The Protocol requires all research on genetic resources to have both the PIC and also the MAT from the “country of origin”.

The Nagoya Protocol is in force in the EU by means of Regulation 511/14. So researchers need to ensure that they ONLY use genetic material which has a PIC and a MAT from the country of origin. Researchers need to use “due diligence” to ensure that they have fulfilled these obligations and failure to do so is a criminal offence.

Saving graces? Nagoya isn’t retrospective, it doesn’t cover human genetic material and not all countries intend to enforce their Nagoya rights.


Page 1 of 2 12