All change for smaller businesses 4: IPO Patent Opinions Service

Sunday is the day for Liz Cohen's Explaining Patent Litigation series, and here's the fourth of her six reader-friendly posts on patent litigation in England and Wales. In this post Liz, who is a partner, Bristows LLP, writes about one of the best -- and most under-used -- features of the British dispute resolution infrastructure, the excellent patent opinions service offered by the Intellectual Property Office. Liz writes:

All change for smaller businesses: IPO Patent Opinions Service

It is well known that small and medium sized enterprises (SMEs) are important for innovation and job creation. It was acknowledged in the Review of Civil Litigation Costs by Lord Justice Jackson, published in January 2010, and more recently, in the Hargreaves Review of Intellectual Property and Growth, published in May 2011, that more needs to be done to assist SMEs with their intellectual property rights in the UK. A number of measures and reforms have since been introduced to achieve this purpose. These include reforming the Patents County Court (PCC) and introducing various tax reliefs. In addition, the IPO is currently consulting on proposals to expand the subject matter of its opinion service and to increase its ability to file revocation actions in relation to patents which it opines are invalid.

The final blog in this three part mini-series looks at the proposed IPO reforms.

The IPO has launched a consultation which outlines proposals to expand the IPO Patent Opinions Service by amendment to the primary legislation. Currently, the service provides non-binding opinions on questions relating to the infringement or validity (limited to novelty and inventive step) of granted UK patents. The IPO has issued over 150 opinions since the service was launched and over 90% of opinions on infringement have been requested by SMEs.

The IPO propose to enhance the Patent Opinions Service by expanding the questions relating to validity that can be the subject of an opinion to align them more closely with the grounds of revocation of a patent (i.e. whether the invention in question is capable of industrial application, relates to matter excluded by Section 1(1)(d) Patents Act 1977, is sufficient, adds matter, or has been extended by an amendment which should not have been allowed). Additionally, the IPO propose to offer opinions as to whether a SPC is valid and/or infringed.

Perhaps the most significant proposal is the expansion of the IPO’s rights to file for revocation of a patent on which it has issued a negative validity opinion. In such circumstances, this will remove the burden, and in particular the cost burden of filing a revocation action. This may be especially beneficial to SMEs. It could also benefit other businesses who have an interest in the patent (e.g. who are worried about infringement) but who were not involved in the opinion process.

The rationale behind the proposals is to enable companies to resolve more of their IP disputes through the Patents Opinions Service without having to resort to costly litigation. The proposals may cause concern for UK patent and SPC holders who may now have to get involved in a dispute at a much earlier stage. Previously, a patent holder would have little concern over a negative validity opinion issued on their patent. This is because the patent would not be revoked unless the opinion requestor commenced revocation proceedings in court or the IPO (which would often be prohibitively expensive for many SMEs). Now there will be a much greater incentive for patent holders to make submissions on validity to the IPO when a patent is challenged using the Opinions Service, as a finding of invalidity may well lead to initiation of costly revocation proceedings by the IPO.

Next week: Permission to Appeal