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The Politicization Of The US Patent System

The Washington Post story, How patent reform’s fraught politics have left USPTO still without a boss (July 30), is a vivid account of how patent reform has divided the US economy, preempting a possible replacement for David Kappos who stepped down 18 months ago. The division is even bigger than portrayed. Universities have lined up en masse to oppose reform, while main street businesses that merely use technology argue for reform. Reminiscent of the partisan divide that has paralyzed US politics, this struggle crosses party lines and extends well beyond the usual inter-industry debates. Framed in terms of combating patent trolls through technical legal fixes, there lurks a broader economic concern – to what extent ordinary retailers, bank, restaurants, local banks, motels, realtors, and travel agents should bear the burden of defending against patents as a cost of doing business.


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    WIPO IP Indicators: Year of Records, China Tops Filings

    Published on 12 December 2012 @ 12:34 am

    By , Intellectual Property Watch

    The World Intellectual Property Organization today (11 December) issued its annual World Intellectual Property Indicators report showing that despite the “continued fragility of global economy,” intellectual property is still performing. The report was issued as WIPO members are discussing a potential new treaty on industrial designs law and practice, with a view of harmonising rules and procedures worldwide.

    China appears to be the IP champion of 2011. The country led the way in patent applications in 2011, the IP indicators found, with 526,412 applications, followed by the United States with 503,582 applications and 342,610 for Japan.

    China also is top of the class in trademark applications, with over 1.4 million applications out of the 4.2 million worldwide, which itself is a record number, according to the report.

    The strong growth of industrial design applications in 2011 is a further incremental effect of the Chinese applications, which again gets the high step of the podium, while the China’s State Intellectual Property Office (SIPO) became the largest patent office in the world, as measured by the number of applications received for patents, utility models, trademarks and industrial designs.

    The WIPO World Intellectual Property Indicators provides data covering several areas of intellectual property such as patents, utility models, trademarks, and industrial designs. The data in the report is taken from the WIPO Statistics Database, primarily based on WIPO’s Annual IP survey and data compiled from international applications going through the Patent Cooperation Treaty (PCT), the Madrid system for the international registration of marks, and The Hague System for the International Registration of Industrial Designs.

    WIPO Director General Francis Gurry said at a press briefing today that IP showed “quite a good performance,” because, in particular “IP concerns the best performing part of the economy,” which is innovation and “those parts of the economy is where we see the new economy operational.”

    The overall figures, he said, reflect the steady intensification of globalisation, with the rise of non-resident applications over the years. WIPO Chief Economist Carsten Fink added that over the last 10 years growth in “second filings,” applications filed outside of the applicant’s original jurisdiction, has been observed, as applicants have a growing interest in seeing their inventions protected in a larger number of countries.

    According to the IP indicators, high-income countries accounted for the majority of patent filings, but offices of upper middle-income countries accounted for about 60 percent of design filings worldwide, most of them in China. Patent filings grew by 7.8 percent worldwide in 2011. Gurry said China was expected to perform as well in 2012 as it did in 2011.

    The number of patent applications is only one measure of performance, and does not show quality, as many do not finish the application process. Gurry said about one-third of applications might not lead to a patent for a number of reasons, such as the patent applicant deciding not to pursue it to completion, or the patent office rejecting the application.

    According to the report, “the number of oppositions or requests for re-examination (or invalidation) appears small compared to total patents granted.” As examples, the report said that at the European Patent Office, 4.7 percent of patents granted were opposed in 2011. At the United States Patent and Trademark Office, the number of requests for re-examination compared to the patents granted was 0.5 percent. In China, the same ratio stood around 0.3 percent.

    Record Patent Filings, EPO Shows Decline

    International patent filings (as opposed to national level) also set a new record in 2011, with 182,354 applications through the Patent Cooperation Treaty (PCT) managed by WIPO.

    China, Japan and the United States accounted for 82 percent of this growth. According to the report, more than two million patent applications were filed in the world in 2011, establishing a new record. This number includes direct national and regional applications, and international applications filed through the Patent Cooperation Treaty (PCT). Patents granted worldwide was close to 1 million, and some 7.88 million patents were estimated to be in force in the world in 2011, an increase of 6.9 percent from 2010. The largest number of patents in force were granted by the US Patent and Trademark Office, followed by the Japan Patent Office (JPO).

    If China showed the largest growth in patent applications with 34.6 percent increase in 2011, the European Patent Office (EPO) saw a 5.4 percent decline. Israel also saw a higher decline with 5.7 percent less applications. The top 10 offices for patent applications received in 2011 were China, the US, Japan, South Korea, the EPO, Germany, India, Russia, Canada, and Australia.

    This list is also reflected in the list of the top PCT applicants: ZTE Corporation in China (telecommunications), Panasonic Corporation in Japan, Huawei Technologies in China (information and communication technology), Sharp Kabushiki Kaisha in Japan (Sharp Corporation), Bosch Corporation in Germany, and Qualcomm in the US.

    The mainthese make up the majority?(no just highest ranking in the list) patent activity worldwide took place in areas such as computer technology; electrical machinery, apparatus and energy; audiovisual technology, telecommunications, and pharmaceuticals.

    Utility Models Favoured by Developing Countries

    Middle-income countries favour utility models, according to the report, more than patents. Utility patents are shorter term, effectively un-examined and easier and less expensive to file. Still in the lead was China, followed by Germany, Russia, Ukraine, Japan and Italy. The top 20 offices granting utility models also includes Turkey, Belarus, Thailand, the Philippines, Brazil, and Mexico.

    According to WIPO, utility models “are issued for a shorter duration (7 to 10 years) and, at most offices, applications are granted without substantive examination.” Unlike patents, the report says, utility models are primarily used by resident applicants. In 2011, the report found that 98 percent of the world utility models applications were resident applications.

    The overall backlog of patent applications in the world went down by 4.9 percent in 2011 said Gurry, after a decline in 2010 of 3.3 percent. This, despite a rising number of patents, he added, showing that strong measures taken by patent offices were having effect. According to the report, the JPO was a main contributor to this trend.

    Trademarks, Industrial Designs Also Rise

    Trademark applications also showed an increase in 2011, due, according to the report, to a rise of 14.4 percent in resident applications, with the largest increases in China, Turkey, the US, Indonesia, and Korea. Resident applications “refer to applications filed by applicants with the relevant national or regional IP office,” the report said.

    Agricultural products and services are leading industry sectors for trademark applications, followed by textiles, clothing and accessories, then by scientific research, information technology, and communications. Management, communications, real estate, and financial services follow, right before the pharmaceutical, health and cosmetic sectors. The report notes that very little change has happened between 2007 and 2011 in the distribution of trademark applications among industry sectors.

    Top 10 offices for trademark applications in 2011 were : China, the US, the European Office of Harmonization for the Internal Market (OHIM), France, Russia, Germany, India, Japan, Turkey, and Korea. However, more than half of global trademark filings occurred at the offices of middle-and low-income countries, accounting for 55 percent of total filings.

    Industrial designs applications are also said to be a record number according to the report. Again the report said strong growth in applications in China has led the global growth, as the country accounted for 90 percent of all growth from 2009 to 2011.

    A substantial increase was also noted by the report in applications at offices of middle-income countries. Most applications are made by the countries’ residents. Main sectors for industrial designs are: furnishing; textile; packages and containers for the transport or handling of goods; articles of clothing ; and means of transport.

    The top 10 offices by application design “counts” (as in the number of designs contained in applications filed) are China, OHIM, Korea, Germany, Turkey, Japan, the US, Italy, Spain, and France. The 10 following are India, Ukraine, Russia, Australia, Brazil, Morocco, China Hong-Kong, Mexico, Singapore and Croatia.

    In 2011, the report said, “over 2.5 million industrial design registrations were in force worldwide. And SIPO had the largest number of registrations in force, accounting for around 37% of the world total.”

    Gurry: Delegates Show Greater Engagement on Design Treaty

    Across the street from the press briefing, WIPO members were discussing a potential treaty for industrial design law and practice, as the Standing Committee on the Law of Trademarks, Industrial Designs and Geographical Indications is meeting from 10-14 December (IPW, WIPO, 10 December 2012).

    Asked about the reported good performance of the low-and middle-income countries on industrial design applications and the fact that those countries showed some reluctance to expedite the process towards a treaty on the matter, Gurry said this week is seeing a “greater level of engagement in the committee,” following the request of the WIPO General Assembly, which was “a positive decision,” in October to expedite the discussions on a treaty draft articles and regulations.

    “We are seeing delegations arrive who have not really been party of the negotiations up to now and are raising a lot of questions that they did not raise earlier on because they were not there,” he said.

    Industrial designs are generally speaking a form of protection more favourable or accessible to developing and middle-income countries, he said, adding that “design protection is an important part of innovation generally.”

    Taking the Apple iPhone as an example, Gurry said that only 25 percent of its technology was patented, “the rest being design and marketing innovation.”

    Catherine Saez may be reached at info@ip-watch.ch.

     


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    We welcome your participation in article and blog comment threads, and other discussion forums, where we encourage you to analyse and react to the content available on the Intellectual Property Watch website. By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

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    By participating in discussions or reader forums, or by submitting opinion pieces or comments to articles, blogs, reviews or multimedia features, you are consenting to these rules.

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    3. By submitting any contribution to IP Watch, you warrant that your contribution is your own original work and that you have the right to make it available to IP Watch for all purposes and you agree to indemnify IP Watch, its directors, employees and agents against all damages, legal fees and others expenses that may be incurred by IP Watch as a result of your breach of warranty or of these terms.

    4. You further agree not to publish any personal information about yourself or anyone else (for example telephone number or home address). If you add a comment to a blog, be aware that your email address will be apparent.

    5. IP Watch will not be liable for any loss including but not limited to the following (whether such losses are foreseen, known or otherwise): loss of data, loss of revenue or anticipated profit, loss of business, loss of opportunity, loss of goodwill or injury to reputation, losses suffered by third parties, any indirect, consequential or exemplary damages.

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