31/03/2017
It is common for patent rights to be transferred between two companies in the same group. The right to claim priority from an earlier application for the same invention filed in another jurisdiction is one of those rights. It is well known that when you file a European patent application that is to claim priority from an earlier application filed in a different name, it is important to ensure that the right to claim priority from the earlier application has been transferred before the European application is filed. There are no remedies if you get this wrong, and an invalid priority claim can of course be a big problem.
A decision recently published by the European Patent Office, T 577/11, illustrates how European Patent applicants and their advisers should take care to ensure that all the formalities of a transfer are completed in good time before filing the application claiming priority.
Background
Article 87(1) of the European Patent Convention (EPC) governs a person’s entitlement to claim priority from an earlier filed application. Reflecting Article 4A of the Paris Convention on which it is based, Article 87(1) EPC recites:
“Any person who has duly filed, in or for
(a) any State party to the Paris Convention for the Protection of Industrial Property or
(b) any Member of the World Trade Organization,
an application for a patent, a utility model or a utility certificate, or his successor in title, shall enjoy, for the purpose of filing a European patent application in respect of the same invention, a right of priority during a period of twelve months from the date of filing of the first application.”
EPO case law has interpreted Article 87(1) EPC as requiring that if a European patent application is filed in the name of a successor in title, as a result of a transfer of the right to claim priority, the transfer must have been effected before the date of filing of the European patent application.
While Article 87(1) EPC governs the date by which the transfer must be effected, the EPC does not include provisions governing the requirements for an effective transfer of the priority right. It has been held in a number of cases (such as T 205/14 and T 517/14) that to be effective, the transfer must meet the requirements of the relevant national law.
Facts of the case
The decision under appeal was the Opposition Division’s decision to revoke European Patent EP 1540227 on the grounds of lack of inventive step.
EP 1540227 was derived from a PCT application filed by Tenaris Connections AG (AG), a Liechtenstein company, on 6 March 2003. The PCT application claimed priority from an Italian patent application filed by Tenaris Connections BV (BV), a Dutch company.
The question of whether AG was entitled to claim priority from the Italian application was not considered during examination proceedings, but during opposition proceedings the opponent challenged the priority entitlement. In response, AG filed an agreement dated 9 September 2003 (three days after the filing date of the filing date of the PCT application) that transferred the Italian application and the right to claim priority from it from BV to AG. The agreement indicated that the transfer had a retroactive effect to 1 January 2003 (before the filing date of the PCT application), and AG argued that this retroactive effective was valid under national law.
The Opposition Division accepted AG’s argument and decided that the patent was entitled to its priority claim. Nevertheless, they revoked the patent on inventive step grounds.
When AG appealed the decision of the Opposition Division, the opponent once again raised the question of priority entitlement. In its first written opinion, the Board of Appeal indicated that it believed the priority was invalid because, on the date the PCT application was filed, the right to priority was not owned by AG. AG was therefore not the successor in title when the European patent application was filed, contrary to Article 87(1) EPC.
Over the course of the remainder of the appeal, AG submitted wide-ranging arguments as to why the Board of Appeal was wrong. These included:
- The date by which the right to claim priority must be transferred is not the date of filing of the European (or in this case Euro-PCT) application, but the date on which the declaration of priority is made. This can, for European applications, be made up sixteen months from the earliest claimed priority date.
- AG filed further arguments and evidence that the retroactive effect of the transfer would be recognised under the national law of Italy (the country in which the priority application was filed) and the Netherlands (the agreement indicated that it was to be governed by the law of the Netherlands), so that the right to claim priority was, retroactively, owned by AG at the filing date.
- There had been an oral agreement before the filing date of the PCT application that transferred the right to claim priority. AG filed a declaration to this effect.
- The agreement with a retroactive effect was made to formalize a prior agreement, and was made in case the validity of previous agreement was not accepted.
- Under Italian law, the very act of filing of the PCT application by AG transferred the priority right to AG under a doctrine of “convincing behaviour”.
Decision
The Technical Board of Appeal decided that the patent was not entitled to its priority claim.
With regard to the relevant date, the Board confirmed the accepted position – for the subsequent application to validly claim priority, the right to claim priority must be transferred before the subsequent application is filed. The date of the declaration of priority is not important in this respect. The Board noted that several decisions issued by the German Federal Patent Court have held the date of the declaration of priority to be relevant date. However, the Board considered that the wording of Article 87(1) EPC – “duly filed” and “shall enjoy, for the purpose of filing a European patent application” – implies that Article 87(1) applies from the date of filing of the earlier application up to the time the European patent application is filed, but not after.
With regard to the agreement which AG argued had a valid retroactive effect, the Board accepted the case law of T 517/14 and T205/14 that held that the question of who can be a “successor in title” within the meaning of Article 87(1) EPC must, in the absence of EPC provisions governing the question, be answered on the basis of national law. However, the Board also held that AG had not established to the Board’s satisfaction that the retroactive effect would be recognised under the national law of Italy or the Netherlands – in the absence of national legislation or case law specifically to this effect, the Board was reluctant to accept this line of argument. The Board took the same view with respect to the “convincing behaviour” argument: AG had not shown to the satisfaction of the Board that the act of filing the PCT application by AG would be recognised under Italian law to be an effective transfer of the right to claim priority.
With regard to the alleged oral agreement, the Board did not admit the declaration because it has been filed at a very late stage and did not clearly and convincingly show that the right to claim priority was transferred. They also held that the argument that the written agreement was made in case the validity of a prior agreement was not accepted was not supported by any evidence that AG had filed.
Conclusion
The Technical Board of Appeal’s decision in T 577/11 confirms and highlights the importance of ensuring that if the applicant for a subsequent European or PCT application is to be different than the applicant for an earlier application from which the subsequent application is to claim priority, the right to claim priority must have been transferred by the time the subsequent application is filed.
The Board members themselves pointed out that if no transfer can be executed before filing, or if the validity of the transfer is in doubt, it is safer to file the subsequent application in the name of the applicant for the earlier application, or to file the subsequent application jointly in the name of both applicants. While recording a transfer after the application is filed may be inconvenient, it is at least possible. In contrast, it is not possible to restore the validity of a priority claim if the applicant was not entitled to claim priority at the filing date.
While the decision also confirms the role of national law in the transfer of rights, it also highlights that it is desirable to avoid relying on national law provisions that may, possibly, allow transfers to have a retroactive effect, and to avoid relying on oral agreements. This case illustrates the difficulty one could expect to face if this was ever necessary. Further, while we cannot draw any conclusions from what the Boards of Appeal do not say in their decisions, it is notable that the Board stopped short of confirming that a contractual agreement with a valid retroactive effect under national law would actually be acknowledged under Article 87(1) EPC.
Interestingly, the Board also noted that it is unclear from the existing case law whether, in view of the fact that the smallest time unit contemplated by the EPC is one calendar day, the transfer must be effected at least one day before filing date of the subsequent application, or whether it would be acceptable for the date of the transfer to be effected on the filing date. It would be advisable not to test this, and to execute transfers in good time before filing the application claiming priority.
This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking any action in reliance on it.
