Saturday, December 22, 2012

The IP year in review

Cathedral Cove Sea Cave - Coromandel, New Zealand
Christmas is a big deal in New Zealand. For most of us the 25th of December marks the start of a two, three or even four week summer vacation. It is a chance to recharge our batteries, ready to return refreshed in the New Year.

I'll be taking a break for a few weeks and returning mid-January. I'll leave you all with a list of my ten most popular posts for the year.

The New Zealand Patents Bill has been a hot topic thanks to a campaign by the open source community to introduce a European-style exclusion for computer software. The patentability of software has also been the subject of a few decisions of the US Courts and the BPAI. Copyright enforcement news in both New Zealand and Australia has also been popular.

Alice and the Abstract Idea: When is a computer-implemented invention a mere "abstract idea”? Does the presence of a computer in a claim make an unpatentable "abstract idea" a patentable invention? Should it matter that a computer-implemented invention is claimed as a method, system, or storage medium? Is there any real difference between these types of claims? These are the questions that the United States Court of Appeals for the Federal Circuit is going to be considering over the next 12 months.

The show goes on: These are interesting times for copyright infringement actions. We have seen a conclusion to the long running dispute between Roadshow Films/AFACT and iiNet in Australia. We have also seen a couple of test cases emerge for New Zealand's three strikes law.

A forum on software patents: Fellow blogger Patentology comments on a recent IP Forum held by the IP Australia on the subject of 'software patents'.

KOHA - Better late than never: Another chapter closes on the KOHA trade mark saga. The New Zealand trade mark application is the subject of a kind of tug-of-war between two competing factions within the open source community that have fallen out with each other.

D. finds non-functional descriptive matter: The Board of Patent Appeals and Interferences considers a data structure for generating network data traffic utilizable in communication systems. The BPAI rejected the data structure claim as relating to non-functional descriptive material.

The embedded software conundrum: The New Zealand Patents Bill had a second reading in Parliament this year. On the table is a Supplementary Order Paper (SOP) setting out proposed amendments to the Bill. The SOP clarifies the extent to which computer programs will be patentable. It better reflects the intentions of the Parliamentary Commerce Select Committee who originally recommended changes to the Bill.

A public slap from Twitter: Laws can certainly be broken in 140 characters or less and Twitter is starting to take a more transparent approach to copyright infringement. It is a bad look for your company to be accused of copyright infringement. And even worse to be slapped so publicly.

Hu finds that storage is the key: The BPAI considered the patentability of a claim in the field of performing log-based recovery by allowing a plurality of worker processes to process in parallel a plurality of work items in a log. Each work item represented an ordered operation on a corresponding data object. The BPAI found that the term "computer-readable medium" is broad enough to cover intangible media. However, a computer-readable storage medium is confined to tangible media for storing data.

Edelson finds an abstract intangible asset: The BPAI looked at a claim for a way for creating financial instrument derivatives of rollups of recurrent yield monetary based assets. Whatever that means! The Board found that simply using some computer-implemented method in some undefined manner alone cannot confer patentability.

Patent party in the House: It's always good to try something new. I gathered some of my work colleagues together and we watched the Second Reading of the New Zealand Patents Bill on the tellie. I didn't quite know what to expect but I wasn't surprised at what I saw. It was certainly an interesting experience.

Photo courtesy of author Daniel Peckham under Creative Commons licence.

Monday, December 17, 2012

Productivity and Patents

The Australian and New Zealand Governments are looking at stronger economic relations between the two countries. The Productivity Commissions of each country have been asked to conduct a joint study on the options for further reforms that would increase ecomomic integration and improve economic outcomes.

The final report is now out. It identifies some initiatives that 'would extend trans-Tasman integration to the benefit of Australia and New Zealand'.

One of the recommendations coming out of the report is that the Australian and New Zealand Governments should proceed with the implementation of a single application and examination process for patents. I cover this in my post Implementation of a trans-Tasman patent examination model.

Under the proposed regime a patent applicant will make a single application to a trans-Tasman portal. The applicant will nominate New Zealand and/or Australia in the application. The trans-Tasman patent application will create a New Zealand application, an Australian application, or a pair of applications that is examined by the same examiner.

The Rationale

The Report notes that the 'single application and examination process for patents ... is intended to simplify the process for those seeking a patent in both Australia and New Zealand and to facilitate closer coordination between the Australian and the New Zealand Intellectual Property Offices'.

We are told that this initiative should have benefits for both countries. The Report notes that '[t]he patent examination process is complex, and it may be increasingly difficult for small countries to maintain the necessary capacity to conduct effective examinations'. I guess we are talking about New Zealand here rather than Australia.

Also mentioned is that '[c]loser cooperation between the Australian and New Zealand Intellectual Property Offices will offer knowledge transfer and greater specialisation which can improve the ability of both offices to respond to current and future demands'.

The Feedback

The New Zealand Institute of Patent Attorneys (NZIPA) submit that a single process would increase applications by overseas owners of intellectual property for patents in both countries (when previously they would have only applied in Australia), to the disadvantage of New Zealand innovators.

Smaller markets attract a correspondingly smaller bundle of patents covering the same overall field of technology. For example, any given electronics patent in the United States will have only a 1 in 100 chance of also being patented in NZ, and about a 1 in 10 chance of being patented in Australia.

The NZIPA feels that increased harmonisation with Australia will lead to an increase in filings from applicants outside Australia and New Zealand. The extent of the increase will depend on the nature and degree of harmonisation.

Common examination processes are most likely to cause a moderate increase (perhaps 50-100%) in patent filing in New Zealand as applicants tack a New Zealand patent application into a strategy that would previously have meant they only filed in Australia. A common patent would cause an increase in overall filings due to the increased market size covered by the patent. This would produce to a radical (500% or more) increase in patents covering New Zealand.

The Policy

IP Australia on the other hand accepts in its submission that the single examination process could increase patent filings in either country. However, there are two reasons why it expects any increase to be ‘modest'.

First, although the proposed reform is anticipated to reduce costs, the commercial viability of seeking patent protection in an additional jurisdiction depends on a range of other costs associated with prosecuting, maintaining and enforcing patent rights.

Second, Australia and New Zealand are both members of the Patent Cooperation Treaty, an international patent law treaty, which already provides a streamlined approach for filing applications in multiple jurisdictions. As such, the proposed changes merely present another option for applicants who wish to file in Australia and New Zealand.

What now?

I agree with the obervations in the Report that 'the impact of a joint application and examination process on the rate of patent filing is difficult to predict — particularly given that many other factors also influence the decision to seek patent protection'.

One of the interesting issues on the horizon is a proposed sharp increase in examination fees for Australian patent applications. This may result in more than a 'modest' increase in New Zealand as patent applicants rely on a cheaper New Zealand search to support their Australian applications.

Friday, December 14, 2012

New Zealand hosts TPP negotiations

handshake isolated on business backgroundNew Zealand has just hosted the 15th round of negotiations of the Trans-Pacific Partnership Agreement (TPP).

The TPP is a free trade agreement between Asia-Pacific countries (currently New Zealand, Australia, the US, Canada, Singapore, Chile, Brunei, Vietnam, Peru, Mexico and Malaysia).

Critics of the TPP in New Zealand are mostly academics, civil libertarians and SMEs with little or no export focus. There are suggestions from these folks that the TPP has provisions that interfere with areas unrelated to trade. While much of the process has been carried out behind closed doors, the intellectual property provisions have been under scrutiny following publication of leaked drafts of the US proposal for the agreement.

Changes to the patent framework

New Zealand proposals of interest include:
  • pharmaceutical patent term extensions;
  • data exclusivity;
  • patent linkage; and
  • patentable subject matter.

Patent term extension

Pharmaceutical patent term extensions are common place internationally, but are not currently available in New Zealand. These provisions extend the time in which the patentee can profit from the protection afforded by the patent, when delays in gaining regulatory approval have shortened its effective life.

Data exclusivity

Data exclusivity is the period of time in which generic drug manufacturers cannot rely on the data provided by the holder of regulatory approval, in order to have their own versions of the drug approved. New Zealand currently provides 5 years of data exclusivity but the US proposal calls for increases to this, particularly for biological products.

Patent linkage

Patent linkage is a process in which regulatory approval of generic drugs is delayed until patents covering the drug have expired. New Zealand currently has no patent linkage provisions.

The effect on Pharmac

All of the above provisions strengthen patent protection for innovative pharmaceutical companies at the expense of generic manufacturers. While the practical effect of these provisions is not clear, there are concerns they will impact on the working of The Pharmaceutical Management Agency (Pharmac).

Pharmac decides which medicines are subsidised in New Zealand, favouring inexpensive, generic medicines where possible. Pharmac is generally credited with achieving good health outcomes from the money the Government spends on medicines.

Patentable subject matter

Other provisions sought by the US are contrary to provisions in the pending New Zealand Patents Bill.

Under the proposed law in New Zealand, computer programs "as such" will not be eligible for patent protection. This exclusion is intended to placate members of the open source community who asked that New Zealand follow the European lead in patent law and explicitly exclude software from being patentable. I cover this issue in my post The embedded software conundrum.

While the Bill limits the patentability of computer programs as such, the US proposal allows subject matter to be excluded from patentability only on the very narrow grounds that commercial exploitation of the invention must be prevented to protect "ordre public" or morality.

Copyright extensions

Another key area of intellectual property of interest is copyright law.

The TPP proposes extending the period of copyright protection for copyright works. In New Zealand the Copyright Act protects copyright for the life of the author plus 50 years. For certain works - for example films - the period is 50 years from when those works are made or published.

The leaked draft of the TPP chapter on intellectual property proposes extending those periods of protection to the life of the author plus 70 years and to 95 years for works like films. These are significant extensions.

Opponents of these changes claim that they will do little to benefit New Zealand or its creative industries. Those opponents argue that there is no economic benefit in extending these terms. They also claim that the extensions are no more than an attempt by powerful commercially lobby groups in the USA to protect their music and film industries.

Other proposals include strengthening the 'three strikes' and digital technical protection measures provisions of the Copyright Act. There are even rumours that there may be an attempt to limit or remove the right to parallel import goods under the TPP. That would have a significant effect on consumers.

New Zealand's stance

The New Zealand government does not appear to support all of these proposals. In addition, the proposals in the leaked document may have been superseded so may not necessarily reflect the current US position.

Whatever the actual provisions sought, the government has acknowledged that it is likely there will be 'horse trading' during the negotiations. The United States position is that weak intellectual property laws are trade barriers. If one benefit of the TPP is getting free access to markets in the United States then the trade-off may be that the New Zealand government agrees to stronger intellectual property protection.
Photo courtesy of author s_falkow under Creative Commons licence.

Wednesday, December 12, 2012

A public slap from Twitter

Slap!Laws can certainly be broken in 140 characters or less and Twitter is starting to take a more transparent approach to copyright infringement.

I decided a couple of years ago that I should probably get into this Twitter thing. Getting started was easy. I picked a twitter handle. I set up a Twitter profile. A pinched a mug shot off my firm's website for my profile photo. I even added a photo from our last family vacation as a header.

My main observation so far about Twitter is how open users are about their thoughts and feelings. Twitter really is a transparent platform. One of the benefits is the ability to reach a wide potential audience. One of the drawbacks is the potential to send something damaging to that same audience.

We are all limited to 140 characters per tweet. It's hard to think how you could infringe someone else's copyright with that sort of constraint. Defamation, harassment, breach of confidence, trade mark infringement, hate speech, and breach of employment contract can all be comfortably carried out within 140 characters, whether you are trying to do it or not. But not copyright infringement.

The copyright problem

What we have to remember is that tweets are not always 140 characters of plain text. Sometimes they contain photos. I've attached photos to some of my own tweets. In each case I was the one who took the photo, or I had permission from the person who did.

Sometimes tweets contain hyperlinks. A lot of my tweets have links to content I find interesting enough to share. These include articles published on my firm's website, news items on media websites and interesting blog posts. There is also shameless promotion of this blog. In each case there is very little risk of copyright infringement. The information is intended to be shared.

The way I use Twitter means that I haven't encountered any copyright issues. However, Twitter does need a policy on copyright infringement for those who use the platform. There is the potential to engage in unauthorized sharing of copyright works. This can be direct by attaching a copyright image. Or it can be indirect by including a hyperlink to a torrent file associated with a copyright work.

Copyright owners are able to contact Twitter and make allegations of copyright infringement. Up until quite recently it was Twitter's policy to quietly delete the tweets containing material that was the subject of copyright infringement allegations. I found an article that said Twitter deleted just over 5,000 tweets in the first six months of this year in response to copyright takedown notices.

The move to transparency

A recent change in policy will see Twitter publicly notify takedowns. The revised Copyright and DMCA Policy says that Twitter's response to takedown notices may include the removal or restriction of access to allegedly infringing material. The company will try and contact the affected account holder and let them know what is going on. That sounds fair enough.

However, Twitter is an open and transparent platform. In an effort to be as transparent as possible, Twitter will now clearly mark withheld tweets to indicate to absolutely everyone that content has been withheld. In the case of an image the message may be something like:

In other cases the tweet may be replaced by a notification like:

What's the problem?

There are the usual grumbles from the civil libertarians. A copyright complainant doesn't need to prove copyright infringement for Twitter to act on it. There is a balance to be struck between dealing with clear cases of copyright infringement on the one hand, and imposing another tool for censorship on the other.

The risk for most of us is of a more practical nature. Many of us tweet from a company twitter handle. It is a bad look for your company to be accused of copyright infringement. And even worse to be slapped so publicly.

In short: think twice, publish once. Be certain you post something that you are prepared to share with a potential audience of millions. You are responsible for what you post on your social media channel. So stay within the legal framework and be aware that defamation, copyright and privacy laws, among others, apply.

An edited version of this article appeared in NZ Marketing magazine.

Photo courtesy of author Vermin Inc under Creative Commons licence.
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