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02

JUL

2020

Pipers Bulletin 2020-6

  1. General

Canada

Further Revisions to Canada’s IP Laws

After recently updating its intellectual property legislation to comply with the terms of its free trade agreement with Europe, Canada is making further amendments so as to comply with the Canada United States Mexico Agreement (CUSMA), which enters into force on 1st July 2020.

CUSMA replaces the North American Free Trade Agreement (NAFTA). Notable changes to Canada’s intellectual property legislation on account of CUSMA are:

  • Allowing for the registration of collective marks.
  • Ensuring that damages for trade mark infringement are sufficient to deter infringement and compensate the rights holder.
  • Allowing enhanced border protection measures, including Customs initiated border measures in relation to suspected counterfeit or pirated goods and removing the exemption for goods-in-transit.
  • Include unreasonable delay in its patent term extension provisions for applications filed on or after 1st July 2020. Subject to exclusions for delays not directly attributable to the CIPO, such extensions will apply to the later of a patent issuing more than 5-years from filing or more than 3-years from requesting examination.
  • For works that have not expired by 1st July 2020 Canada will have until 1st January 2023 to increase the standard copyright term by 20-years to the life of the author plus 70-years. For other copyright works the term will increase to either 75-years from the end of the year in which they were first published or 70-years from the end of the year in which they were created if not published within 25-years of creation.
  • Providing criminal remedies for wilfully removing or altering rights management information for commercial advantage or financial gain.

  1. Patents

Australia

Aristocrat’s Appeal Gamble Pays Off

In 2020 FCA 778 Aristocrat Technologies Australia Pty Limited v Commissioner of Patents the Judge warned against over abstracting the inventive concept when the patentable subject matter determination is made.

Four of Aristocrat’s granted innovation patents make claims to an electronic gaming machine (EGM) that includes a combination of physical parts and computer software to produce particular outcomes in the form of gameplay, and were found to lack patentable subject matter after examination was requested. It was mutually agreed that the appeal could focus on just one of those innovation patents.

The agreed common general knowledge in relation to EGMs noted that they are distinguished from each other by the way in which features were introduced to utilise the physical or hardware components to provide different products that would engage and entertain users in different ways. Typically this involved features such as the use of free games, bonus games or secondary games triggered by events in the main or base game. It was also noted that remote servers can implement most or all of the game play on a given EGM and that the design of EGMs needs to comply with regulatory standards.

Aristocrat’s innovation patents concern integrated hardware and software components that provide a gaming procedure involving configurable and non-configurable symbols whereby some configurable symbols can be selected for display during the base game, with feature games being triggered by collections of the configurable symbols. When a feature game is triggered it utilizes those configurable symbols in that and further rounds of the feature game, while randomly replacing non-configurable symbols with symbols from a second set of reels, which also contain both configurable and non-configurable symbols.

Aristocrat appealed from the Delegate’s decision which had found there to be no patentable subject matter as the alleged technical contributions either amounted to games or game rules – making them a mere scheme - or are mere presentation of information, neither of which qualifies as a manner of manufacture.

The Commissioner defended the Delegate’s decision, arguing that the substance of the invention is a set of rules or scheme implemented on generic software and hardware, and is only distinguished from other EGMs by the particular sets of rules and so merely amounts to instructions to implement an abstract idea. It was further asserted that there is no technical contribution in the way that the machine carries out the scheme and no improvement in the operation or functionality of the machine as distinct from the fact of its implementation of the scheme. That the claimed invention merely requires generic computer implementation was evidenced by the claims not specifying any particular program application for carrying out the steps and it was asserted that it could be implemented on the basis of the common general knowledge.

However, the Judge considered it was wrong to class this case as being on a par with other software patent cases such as Grant, Research Affiliates and Rokt, since those cases concerned whether or not a mere scheme, or plan, was nonetheless a manner of manufacture because invention lay not only in the scheme or plan, but also the means by which it was realised using computerisation. The Judge considered that the facts of this case meant that it qualified as a manner of manufacture at the first step and so did not need to qualify via the second step. The Judge held that the invention is not for a mere scheme or plan, rather it is to a mechanism that combines hardware and software to realise an EGM that functions in particular ways, thereby producing practical and useful results. The Judge considered that the Delegate fell into error because they first sought to identify the inventive concept and then characterised it as a mere scheme after considering the invention at a high level of abstraction. To avoid the risk of such over abstraction the Judge considered that it should first be asked whether the claim is for a mere scheme at all as this is more likely to take into account all of its specific limitations. The Judge also noted that if a gaming machine could produce the same functions without the use of software that it would qualify as patentable subject matter and so the use of software should not turn it into unpatentable subject matter.

PCT

Forthcoming PCT Fee Changes for Australia

Effective from 1st August 2020 the International Filing fees will change for Australia. The table below gives the changes in the equivalent amounts in AUD: (PCT Newsletter; 2020/6)

PCT Intl Filing Fees

Intl Filing Fee

Fee per sheet over 30

PCT-EASY Reduction

(Varies according to electronic format)

Current Fee (AUD)

2,356

27

354 – 531

Fee from 01/08/2020

2,150

24

323 – 485

Effective from 1st August 2020 the Handling fee for an International Examination carried out by IP Australia, will change as indicated below. (PCT Newsletter; 2020/6)

IPEA (Currency)

IPEA Handling Fee (Current)

IPEA Handling Fee (1/08/2020)

IP Australia (AUD)

354

323

United Kingdom

Enablement Required in Respect of Product’s Claimed Utility

In 2020 UKSC 27 Regeneron Pharmaceuticals Inc v Kymab Ltd the Supreme Court held that the Court of Appeal was wrong to find Regeneron’s patent had disclosed a principle of general application and so did not need to explain the making of its subject matter across the full range of the claim.

Regeneron filed its application for a new type of genetically modified mouse in 2001. The genetically modified mice contain a hybrid version of the gene that produces antibodies, where the antibodies contain both a constant region comprised of a section of the mouse’s genetic material and a variable region comprised of human genetic material. This recognised breakthrough means that the mice can be used to produce antibodies which are suitable for medical treatment in humans, but are sufficiently similar to the antibodies of the mouse so as not to cause immunological sickness in the mouse.

Regeneron commenced proceedings against Kymab in 2013, although Regeneron’s application only achieved grant in 2015. Both of the lower Courts found claim 1 to relate to the making of a range of types of mouse rather than a single type of mouse as different mice would fall within the claim depending upon differences in the human genetic material produced. The trial Judge found the patent infringed but invalid for insufficiency, while the Court of Appeal reversed the trial Judge’s insufficiency ruling after finding the specification to be enabling on account of disclosing a principle of general application. In particular, the Court of Appeal found that the person skilled in the art would be able to use the disclosure to insert some human material into the mouse’s genes and considered that different mice falling within the claim could be similarly genetically engineered.

However, the majority Supreme Court judgment found that Regeneron’s disclosure did not teach how to make more complicated hybrid structures, such as where all of the potential human variable region is populated with human material. It took a further decade before a reliable method for generating such a hybrid gene structure – known as reverse chimeric locus - was invented. As such the Supreme Court held that Regeneron had not adequately satisfied the patent bargain under which the scope of the monopoly is in proportion to the scope of the technical contribution. By relying upon disclosure across the full range by way of the principle of general application Regeneron risked a finding of insufficiency when – as turned out to be the case – the skilled person at the priority date could not use the disclosure to work the full width of the claim.

While the invention worked across the whole range in terms of providing a cure to immunological sickness in each type of mouse, that was not the focus of the claim, rather it was simply a means to the end of producing hybrid antibodies. The relevant range of disclosures required is determined by the utility of the product, which in this case would require sufficient disclosure to make the claimed range of mice that produce hybrid antibodies.

United States of America

Structurally and Functionally Similar Compounds can Establish Prima Facie Case of Obviousness

In 18-2097 Valeant Pharmaceuticals International v Mylan Pharmaceuticals Inc the Court of Appeal for the Federal Circuit (CAFC) reversed a District Court’s finding that structurally and functionally similar compounds did not establish obviousness and remanded the case for further consideration.

Valeant’s patent relates to stable methylnaltrexone pharmaceutical preparations. Methylnaltrexone is a quaternary amine opioid antagonist derivative that is known to be useful in reducing the side effects of opioids, but which was also known to be unstable in aqueous solution. Valent achieved significantly improved stability by adjusting the pH range to between 3.0 and 3.5. Mylan acknowledges that its proposed generic version would infringe claim 8 of Valeant’s patent, which claims a methylnaltrexone preparation with a pH range between 3.0 and 3.5 and having 24-month stability, but argued that claim 8 is obvious in light of other solutions of similar anti-opioids – naloxone and naltrexone.

Valeant sought summary judgment to the effect that claim 8 is not obvious. The District Court agreed with Valeant, finding that the references involved the use of stabilizers and did not teach methylnaltrexone preparations or make such preparations obvious to try and that the achieved increased stability could not be expected.

The prior art involved stable injectable preparations involving either naloxone or naltrexone (with the addition of stabilizers) with similar pH range that are functionally similar to Valeant’s preparation and also showed that naloxone and naltrexone have a significant degree of structural similarity to methylnaltrexone. Mylan argued that these similarities established a prima facie case of obviousness with the subject matter of claim 8 being arrived at by routine optimization or that methylnaltrexone would be obvious to try. Valeant downplayed the relevance of the functional and structural similarities on account of the prior formulations involving the addition of stabilizers and asserted that the structural differences made methylnaltrexone function differently.

The CAFC found the overlapping pH ranges of the prior art to be sufficient for establishing a prima facie case of obviousness for the claimed preparation of methylnaltrexone for summary judgment purposes, thereby shifting the onus to Valeant to establish why the invention is not obvious. The CAFC held that overlapping ranges from the prior art for solutions of structurally and functionally similar compounds can establish a prima facie case of obviousness as the person skilled in the art can expect that structurally and functionally similar compounds are likely to share other related properties as well. The CAFC considered that the long term stability of the preparation is likely to be one of those related properties, even though the prior art preparations involved the addition of stabilizers. The CAFC remanded the case back to the District Court where the onus will be on Valeant to establish that the claimed pH range is critical or that there are unexpected benefits or that the prior art teaches away from the claimed invention.

The CAFC also took issue with a couple of the District Court’s findings in relation to Mylan’s obvious to try argument. The District Court found that the pH range of 3 to 4 would not be obvious to try as there are an infinite rather than a finite number of options for testing long term stability within the acidic pH range of 3 to 7. In particular, the District Court held that given any two unequal numbers, the quantity of number ranges falling between the two is infinite, not finite. The CAFC found that in practice pH is measured to at most two significant figures, and so the person skilled in the art would only have a manageably finite number of options to test amongst those that the prior art identifies as worth pursuing. The District Court had also rejected some prior art on the basis that pH was not the first variable that it identified, but the CAFC found there to be no such requirement.

  1. Trade Marks

New Zealand

Frucor gets Nifty with Shades of Green

In 2020 NZIPOTM 5 Frucor Suntory New Zealand Limited v Energy Beverages LLC a discrepancy between the IPONZ register representation of Frucor’s colour mark and the accompanying description and the mark as used was held not to justify revoking the mark for non-use.

In August 2008 Frucor applied to register a single colour mark with the following description - The mark consists of the colour green (Pantone 376C), as shown in the representation attached to the application, applied as the predominant colour to the goods, their packaging or labels. The representation on the register is as shown here. In June 2012 the mark was registered on the basis of acquired distinctiveness.

In June 2017 Energy Beverages filed a non-use application on the basis that the representation on the register does not match either Pantone 376C or the mark as used. The depiction of Pantone 376C in the Pantone colour system is as shown here.

Evidence was led to the effect that it is not possible to have an exact Pantone colour system match for colours printed on metallic cans as the Pantone colour system does not take into account colour printed on such metallic substrates. Further, the grey of aluminium cans and the thin ink film can change the apparent colour, and even a skilled printer cannot reliably print a Pantone colour match on aluminium cans. Frucor said it chose Pantone 376C as the closest match, where the ‘c’ suffix refers to the colour being printed on coated or gloss paper.

Frucor also argued that the process of scanning, uploading, downloading and printing colour marks can lead to loss of integrity with respect to the original representation. IPONZ no longer retained the paper file as these are destroyed following its digitization for the purposes of IPONZ’s online system. However, the trade mark attorney who filed Frucor’s application gave a declaration that included a copy of the application filed which had a square sample that had been cut from a metallic label stapled to it as shown here.

The Assistant Commissioner accepted the trade mark attorney’s evidence and agreed that the mark should be defined by the written description rather than the image on the register, particularly given that the written description includes the phrase “as shown in the representation attached to the application”. The Assistant Commissioner accepted that the representation on the register is likely the result of IPONZ’s digitization process. The Assistant Commissioner rejected Energy Beverages’ argument that the lack of a Pantone system for metallic substrates means that Pantone 376C cannot have been used on the cans, finding the mark as used sufficiently similar to Pantone 376C taking into account that it is on a metallic substrate. In this regard it was held that the perception of the average consumer is more important than that of an expert in printing processes.

The further decision 2020 NZIPOTM 6 Frucor Suntory New Zealand Limited v Energy Beverages LLC involving the same mark also issued on the same day and involved the issue of whether the mark qualifies as a trade mark and whether it is contrary to the law of equity.

Energy Beverages argued that the mark does not qualify as a trade mark as the use of the word ‘predominant’ in the written description means that it lacks certainty or precision in that it allows for a multitude of forms of representation and so can cover multiple signs with different permutations, presentations and appearances. They cited a UK Court of Appeal decision which found the use of the word ‘predominant’ in the written description to lack certainty or precision.

Frucor countered by noting that its mark had been registered for more than 7-years at the date of the invalidity application and so is presumed to be valid unless it falls within the exceptions mentioned in section 75. Amongst the exceptions to the presumption of validity is that the mark should not have been registered on account of the absolute grounds for objection in section 17. However, Frucor argued that Energy Beverages objection does not fall within the exceptions mentioned in section 75 as correctly understood it falls under section 18(1)(a) as it amounts to arguing that the sign is not a registrable trade mark.

The Assistant Commissioner accepted Frucor’s argument, finding that the absence of section 18 provisions in the exceptions to the section 75 presumption of validity was deliberate on the part of the legislature. Similarly, the Assistant Commissioner found that Energy Beverage’s contrary to the law of equity argument is also precluded on account of not falling within the exceptions to section 75.

However, in case she is wrong regarding the ‘not a registrable trade mark’ objection, the Assistant Commissioner went on to hold that the use of the word ‘predominant’ in the written description does not necessarily mean that the mark lacks clarity or precision. On the facts of the case the Assistant Commissioner held that Frucor’s registration is sufficiently clear and not defective for want of precision, and that the most memorable or main colour that catches the eye of reasonable consumers is the appropriate way to understand the use of ‘predominant’ in this context.

About the Firm

Pipers IP
Address 1st Floor, Imagetext House, 3 Owens Road, Epsom, Auckland 1023, New Zealand
Tel 64-9-919 9450
Fax 64-9-919 9454
Email patents@piperpat.com
Link www.piperpat.com

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