Changes In UK Patent Law - The Patents Bill 2004

The Patents Bill¹recently introduced in the House of Lords will make important changes to UK Patent Law. Businesses which apply for or hold UK patents, need to be aware of these changes. This hot topic is an alert to some of the major provisions.

The Bill makes amendments to the Patents Act, 1977 both to deal with the requirements of the amended European Patent Convention of 2000², and to make changes to the domestic patent law. There are also some minor changes to the Act to reflect changes in the regulations made under the PCT.

The Patents Bill is running in tandem with the Regulatory Reform (Patents) Order, 2004³which makes changes to the Act required by the Patent Law Treaty 2000⁴, which harmonises procedures for filing and prosecuting patent applications.

Among many changes the five most important are :-

• New provisions applying to the making of amendments.

• Changes in relation to relief given in proceedings based on a patent which has been amended or which is held to be partially invalid.

• Major changes to employee compensation provisions.

• New rules about threats of patent infringement proceedings.

• Changes to the provisions relating to methods of treatment or diagnosis for humans or animals and the need for Swiss type claims for second medical use.

Under Section 27 and 75, the Court or Comptroller may refuse an amendment on discretionary grounds, even if the amendment as such is allowable. Few if any other members of the European Patent Convention recognise the discretionary ground for refusing an amendment

To bring UK law into line, many thought the discretionary ground of refusal should be removed. The Bill sets out a compromise. In deciding whether to allow an amendment, the tribunal must have regard to the principles applicable to amendments under the EPC. So the court must look at EPC regulations or guidelines or decisions of the EPO. In practice this could spell the eventual removal of the discretionary ground for refusing amendments.

Perhaps anticipating the demise of the discretionary ground for refusing amendments, the Bill introduces a new condition for the recovery of damages for a patent that has been amended or is held to be partially invalid (Sections 62 and 63). The requirement that the specification was framed in good faith and with reasonable skill and knowledge remains. The added condition is that the relief (the claim for damages) was sought in good faith. A court could use this to bar a damages claim if, for example, the patentee knew, or maybe even ought to have known, his patent was too wide.

Sections 40 to 43 of the Act give employees a right to compensation for making patented inventions which are of outstanding benefit to the employer. The provisions have been of very little value to employees. Among other difficulties, the employee had to show that the benefit stemmed from the patent itself rather than the invention.

This impediment is to be removed. The court will now look at the employer’s benefit from the invention or the patent or the combination of both. This is a radical change but it will only affect patents applied for after the date the Patents Bill becomes law. There is no retrospective effect.

Existing Section 70 excluded from the threats provisions a threat relating to the making or importing of a product or using a process. The courts have held this exclusion does not extend to threats relating to the product’s subsequent sale. This somewhat artificial distinction is to be removed. There are also provisions intended to make it easier for patentees to pursue enquiries about the source of infringing products without running the risk of proceedings for threats.

In the Act, methods of treatment and diagnosis are excluded from patentability on the ground that they are not capable of industrial application. To bring UK law into line with the EPC the basis for such exclusion will be changed. They will simply be excluded from those things for which a patent can be sought. The change is not thought to have substantive effect.

The need for Swiss type claims for second medical use of known substances is to be removed. They will be treated in the same way as first uses and can be claimed in the form "Substance X for use in treatment of disease Y".

As always, the fate of legislative changes rests with the courts. In particular, the discretion to refuse amendments has been carefully preserved and it will be particularly interesting to see how the courts deal with the new provisions of Sections 27 and 75.

In the longer run, the amendments to employee compensation rules may have the greatest effect. The changes may open the door eventually to a much greater "employee compensation culture".

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