Since 1994,
various amendments have been made to the Patent Law to improve
the intellectual property protection in Japan. The latest
revisions to the Patent Law, together with the revisions
made to the Patent Law in April, 1998, mark a great advance
toward the adequate protection of intellectual property.
The primary objective of the revisions is to enable patent
rights to be acquired, maintained and protected (1) strongly,
(2) quickly, (3) at lower cost and (4) by simplified procedures,
as briefly described below.
I. Strengthening
of Patent Protection
1.
Reduced Burden of Proof in Litigation
(1) Amendments to the Civil
Procedure Law
In the former civil procedures,
heavy burden of proof imposed on the plaintiff was an
obstacle to prompt protection of rights. This tendency
was particularly noticeable in patent infringement cases
where proof of infringement was difficult.
Amendments to the Civil
Procedure Law came into effect on January 1, 1998. These
amendments have brought about a substantial reform in
the procedures of civil action. Noteworthy revisions
concerning the burden of proof include imposition of
greater obligation of document production and introduction
of interrogatories.
(a) Higher Duty for Document
Submission:
According to the former
Civil Procedure Law, one party could request the other
party to submit only a limited range of documents. The
Civil Procedure Law has now been amended to impose general
obligation of document submission on both parties, whereby
each party is required to submit documents unless the
requested documents are specifically exempted* in the
Law.
*Exemption: The document
is exempted from submission if it includes information
"relating to technical and trade secrets"
or "which is to be held in confidence by an attorney
at law or a patent attorney."
(b) Introduction of Direct
Interrogatories:
According to the amended
Civil Procedure Law, each party may make inquiries directly
to the other without routing through the court. This
amendment is expected to enable either party to make
quicker access to the necessary information. However,
the amended Civil Procedure Law provides no sanction
against the party refusing to reply.
(2) Proof of Infringement
(a) Document Submission
Order for Proof of Infringement (revised 1999, effective
as of January 1, 2000):
To facilitate the proof
of patent infringement, the Patent Law has been amended
to empower the court to order either party, at the request
of the other party, to submit a document needed for
the proof of infringement. However, the party holding
such a document may refuse its submission if there is
a reasonable ground for refusal. (Patent Law, Section
105(1))
(b) In-camera Procedures
to be Followed for Refusing Court's Order for Document
Submission (revised 1999, effective as of January 1,
2000):
In case where a party
ordered to submit a document for the proof of infringement
refuses to do so, the court may make the party submit
a document needed for judging if there is a reasonable
ground for refusal. No one can request the disclosure
of the document submitted for this purpose.
If any party does not
obey the court's order to produce such document, the
court may acknowledge (1) "the other party's assertion
as to the document to be true," or (2) "the
other party's assertion as to the fact to be true"
if it is extremely difficult to prove by any other evidence.
Though submission of documents
may be refused for reasons of trade secrets, it is expected
that an appropriate judgment be made by the court through
the in-camera procedures.
(c) Defendant's Obligation
for Clarification of Acts to Deny Alleged Infringement
(revised 1999, effective as of January 1, 2000):
According the amended
Patent Law, if a patentee alleges a specific product
or process as constituting an infringement, the other
party will have to disclose its own acts for denial
of the infringement with respect to the alleged product
or process unless there is a reasonable ground for refusing
to do so. (Section 104bis)
Before amendment, the
plaintiff under obligation to identify the defendant's
acts for proof of infringement (of a product or process
patent) often needed much time and/or found it impossible
to point out what specifically constitutes an infringement.
The new provision of Section 104bis is expected to substantially
reduce the plaintiff's burden of proof in identifying
the allegedly infringing act.
(3) Proof of Damages
Suffered by Patentee
Article 709 of the Civil
Code stipulates that any infringer should compensate
for the damages caused by an infringement. Such compensation
is made only if there are (1) an infringement, (2) an
intent or negligence of the infringer, (3) damages suffered
by the patentee, and (4) a causal relationship between
the infringement and the damages.
In view of difficulty
of proof as to the damages, the former Patent Law provides
that "the profits earned by the infringer is presumed
to be the damages suffered by the patentee," or
the patentee may seek to recover at least "the
amount which is normally received for the working of
a patented invention." However, because of the
difficulty of proving the causal relation, namely the
requirement (4) above, there were many cases in which
the patentee could recover only the amount equivalent
to the normal royalties for the licensing of the patent.
In view of this situation,
the following amendments were made in 1998 and 1999:
(a) The word "normally"
was deleted from the "amount which is normally
received for the working of a patented invention"
(revised 1998, effective as of January 1, 1999):
As a result, it is possible
to prevent the recoverable amount from being unjustifiably
low due to the interpretation of the word "normally."
(b) Simplified Calculation
of Damages (revised 1998, effective as of January 1,
1999):
Under Section 102(1) of
the amended Patent Law, the patentee may request compensation
for the damages determined according to the following
equation.
Damages = (number of infringing
products sold) x
(unit profit that could
have been earned by patentee)
Under this new provision,
the patentee has only to prove the number of infringing
products sold by the infringer and the unit profit.
Therefore, the patentee's burden of proof is significantly
lessened especially when the patented invention is worked
by the patentee itself. The burden of proof is imposed
on the defendant for requesting any reduction from the
damages determined as above. Thus, the burden of proof
is equally shared by the plaintiff and the defendant.
(c) Appraiser Appointed
by Court (revised 1999, effective as of January 1, 2000):
Under Section 105bis,
the court may appoint an appraiser for evaluating any
matters necessary for calculation of the damages at
the request of either party. The parties have to provide
necessary information to the appraiser.
There were some litigation
cases where the court had an appraiser calculate the
profits and/or damages, but the parties had no obligation
to cooperate with the appraiser. However, under the
new provision, it is obligatory for the parties to give
the information which the appraiser deems necessary,
thereby realizing more accurate determination of the
damages.
(d) Determination of Reasonable
Damages by Court (revised 1999, effective as of January
1, 2000):
Under new Section 105tert,
when it is extremely difficult to prove the damages
in a litigation where infringement is acknowledged,
the court may award reasonable damages on the basis
of the hearings and evidences as a whole.
2.
Severer Penalties for Infringement
Criminal penalties are stricter
for patent infringement, as briefly described below. In
particular, fines for a corporate infringer are markedly
raised. The heavier penalties are expected to provide
an improved deterrence against patent infringement.
(1) Initiation of Public
Prosecution without Lodgment of Complaint against Patent
Infringement (revised 1998, effective as of January 1,
1999):
Before the amendment of
the Patent Law in 1998, public prosecution could be
initiated only upon lodgment of a complaint. (Section
196(2) now abandoned) Such
a restriction for the initiation of public prosecution
has been removed in order to more effectively deter
patent infringement.
(2) Heavier Fines for Corporate
Infringer (revised 1998, effective as of January 1, 1999):
When an officer or employee
of a corporation commits a patent infringement in business
of the corporation, the corporation itself may also
be held liable. The upper limit for the fines imposed
on the corporation has been raised to 150 million yen
from current 5 million yen.
(3) Heavier Fines Imposed
on Cooperation for Fraudulent Conducts against Patent
Office or for False Patent Marking (revised 1999, effective
as of January 1, 2000):
When an officer or employee
of a corporation obtains a patent, a patent term extension,
a decision in an opposition case or a decision in a
trial case through fraudulent conducts, the corporation
may also be held liable. The same also applies to false
patent marking. The upper limit for the fines imposed
on the corporation in such a case will be raised to
100 million yen from current 3 million yen.
3.
Other Improvements for Stronger Patent Protection
(1) Improvements in Patent
Term Extension (revised 1999, effective as of January
1, 2000): Currently, the following requirements must be
met for obtaining a patent term extension.
(a) The period in which
the patentee cannot exploit the patented invention due
to the need for governmental approval for safety confirmation
etc. has to be 2 years or more.
(b) An application for
extension must be filed at least 6 months prior to the
expiration of the patent.
These two requirements
will be deleted. Thus, a patent term extension may be
obtained even if the unexploitable period is less than
2 years, provided that an application for such an extension
is filed prior to the expiration of the patent.
(2) Closer Communication
between the Court and the Patent Office (revised 1999,
effective as of January 1, 2000)
The court should inform
the Patent Office as to the filing and termination of
an infringement suit. On the other hand, the Patent
Office should inform the relevant court of any trial
filed against the patent involved in the litigation,
the decision in the trial, or withdrawal of the trial
demand. (Patent Law, Sections 168(3), (4)).
This amendment is expected
to result in a timely decision for avoiding such a situation
that the court awards damages in an infringement litigation
of a patent which is later invalidated by the Patent
Office.
(3) Improvements of the
so-called "Hantei" Procedures Calling for Non-binding
Official Opinion of the Patent Office as to the Scope
of Patented Invention (revised 1999, effective as of January
1, 2000)
A patentee or an interested
third party may seek for a non-binding official opinion
of the Patent Office as to the scope of the patented
invention. This administrative action made by the Patent
Office is called "Hantei".
Since a "Hantei"
opinion is made by three trial examiners who are technically
experienced, it is considered reasonably reliable. For
further enhancing utility and reliability of the "Hantei"
procedures, the following features will be newly introduced.
(a) The inspection of
evidence will be performed in accordance with the relevant
provisions of the Civil Procedure Law.
(b) The court may request
the Patent Office to issue a "Hantei" opinion
if necessary.
II. Early
Grant and Protection of Patent
1.
Shorter Period for Requesting Examination (revised 1999,
effective as of October 1, 2001):
The period for filing
a request for examination will be shortened to 3 years
(currently 7 years) as counted from the filing date.
The period in which substantive examination may be requested
is an uncertain period where a third party may not know
the subsequent fate of the application with a possibility
for amendments of the claims as published. Consequently,
anyone making a decision on new research and development
projects or business investments would have to run a
risk. This has been one of the discouraging factors
in making research, development and investment.
Statistically (for applications
filed in 1990), substantive examination was requested
for 48% of all patent applications, and 51% of the requests
was made in the last 2 years of the 7year
period. This means that many applications (about 1/4
of all applications) were held uncertain or unstable
for at least 5 years from the filing date.
The shortened period for
requesting examination will correspondingly shorten
the uncertain period while realizing a quicker grant
of a patent.
2.
Early Laying-open of Application (revised 1999, effective
as of January 1, 2000):
The applicant of a patent
application may request that the application be laid
open even if 18 months has not lapsed from the filing
date (or the earliest priority date). The following
advantages may be expected from the early laying-open.
(1) Earlier establishment
of provisional protection (for demanding a compensation
for the unauthorized exploitation of the claimed invention
as laid-open), which is enforceable after grant.
(2) Earlier establishment
of prior application status prevailing over later-filed
applications directed to the same invention on the basis
of the whole content approach.
(3) Earlier disclosure
of invention for defensive purposes.
The applicant of an international
application can enjoy the earlier provisional protection
for demanding a compensation only if a Japanese translation
of the international application is published.
3.
Improved Treatment of Prior Application Status (revised
1998, effective as of January 1, 1999):
Before the amendments
of the Patent Law in 1998, a prior-filed application
was accorded a "prior application status"
prevailing over a later-filed application with a double-patenting
relationship even if the prior-filed application was
later rejected decisively or abandoned. According to
Section 39(5) of the amended Patent Law, by contrast,
if a patent application is finally rejected or abandoned,
it loses its prior application status prevailing over
later-filed applications. This change eliminates the
irregular situation where an application has a prior
application status even without disclosure of its content
to the public if it is finally rejected or abandoned
before its laying-open.
Consequently, an applicant
should consider requesting early laying-open of the
application to avoid final rejection before it is compulsorily
laid-open. If the application is rejected before the
laying-open, it cannot be cited against later applications
directed to the same invention.
4.
Facilitation of Trial Procedures before the Patent Office
(1) Expedition of Invalidation
Trials (revised 1998, effective as of January 1, 1999):
Before the revisions
of the Patent Law in 1998, an amendment of grounds
for invalidation, including submission of new grounds,
was unlimitedly allowed until the parties were notified
of the termination of the trial. This often caused
a delay of the trial prosecution, resulting in delayed
issuance of a decision.
Under the 1998 revisions,
it is no longer permitted to amend the gist of grounds
for invalidation specified at the time of filing a
trial, thereby expediting the trial prosecution.
(2) Appointment of Trial
Secretary (revised 1999, effective as of January 1,
2000):
A new provision is introduced
to empower the Commissioner of the Patent Office to
appoint, besides the Board of Trial, a "trial
secretary" in a trial case. (Section 144bis)
The trial secretary is responsible for matters concerning
notarial acts, such as preparation of records.
The purpose of this
new provision is (1) to accelerate oral hearings through
the strengthened notarial function for shortening
the time up to the decision, and (2) to speed up the
trial
procedure by reducing
the work load of the trial examiners, thereby enabling
them to concentrate on the trial proceedings. The
responsibilities of the trial secretary include (1)
preparation of records, (2) jobs relating to serving
notices and (3) other jobs as ordered by the trial
examiner-in-chief.
A similar provision
has been also introduced with respect to the post-grant
opposition procedures.
5.
Change of Requirements in Entering Amendment during Opposition
Procedures and Invalidation Trials (revised 1999, effective
as of January 1, 2000):
In a post-grant opposition
and an invalidation trial, the patentee may amend the
specification and the drawings at the time of responding
to an Official Action. Under the current Patent Law,
an amendment may be entered only when the invention
after the amendment is patentably defined. Therefore,
the Examiners in charge must first consider whether
or not the amendment should be entered in view of this
requirement.
However, the above requirement
for entry of the amendment actually coincides with the
grounds for opposition or invalidation. Thus, according
to the revised Patent Law, the amendment may be entered
even if the claimed invention as amended lacks patentability,
but the patent will be canceled or invalidated for lack
of patentability.
III. Cost
Reduction in Obtaining and Maintaining Patents
1.
Decrease of Annuities for Maintaining Patent
(1) Leveling of Annuities
(revised 1998, effective as of July 1, 1998):
The annuities for the
10th and any subsequent years have been leveled for
a given number of patented claims. This has realized
a considerable decrease of fees for maintaining the
patent.
(2) Further Decrease of
Annuities (revised 1999, effective as of June 1, 1999):
In addition to the above
leveling, the annuities for additional claims (other
than the first claim) have been decreased.
2.
Decrease of Fees for Requesting Examination (revised 1999,
effective as of June 1, 1999):
Further, the fees for
requesting examination with respect to additional claims
(other than the first claim) have also been decreased.
3.
Broadening of Entities Entitled to Exemption from Fee
Payment etc. (revised 1999, effective as of January 1,
2000):
Under the current Patent
Law, only inventors or their heirs who cannot afford
to pay annuities or examination fees may be entitled
to decreased fee payment, deferred fee payment or fee
payment exemption, subject to approval of the Commissioner
of the Patent Office. The revised Patent Law broadens
the scope of entitled entities to include legal entities
such as small business concerns.
IV.
Simplification of Procedures
1.
Exemption from Submission of Priority Documents under
Paris Convention (revised 1998, effective as of January
1, 1999):
In accordance with the
discussion of three patent offices (Japan, U.S.A. and
EPO), the provision regarding the submission of the
priority documents was revised. An applicant claiming
priority under the Paris Convention is not required
to submit the priority documents, provided that the
Japanese Patent Office can exchange priority data through
electronic means with the office with which the basic
home application was filed.
At present, this exemption
applies only to an application claiming priority based
on an European Patent application. In this case, the
applicant needs only to make the priority claim at the
time of filing the application and later specify the
application number of the basic home application within
16 months from the priority date.
2.
Exemption from Document Submission at the time of Converting
or Dividing Application (revised 1999, effective as of
January 1, 2000):
Presently, when converting
or dividing an application, the applicant is required
to re-submit the priority documents and/or the documents
for supporting the applicant's entitlement to exception
to the loss of novelty at the time of the conversion
or division. According to the revised Patent Law, these
documents will no longer be required.
V.
Other Revisions for Adjustment
1.
Change in the Definition of Novelty (revised 1999, effective
as of January 1, 2000):
In view of the present
situation where much information is globally available
not only through printed publications but also otherwise,
Section 29(1) of the Patent Law is amended to include
"publicly known or used abroad" as a new ground
for the loss of novelty. In whole, Section 29(1) provides
that novelty is lost if the claimed invention is:
(1) publicly known in
Japan or abroad;
(2) publicly used in Japan
or abroad;
(3) described in a printed
publication distributed or become publicly available
through electric telecommunications in Japan or abroad.
2.
Broader Exception to Loss of Novelty (revised 1999, effective
as of January 1, 2000):
The revised Patent Law
provides for a broader scope of exception to the loss
of novelty. For example, an invention disclosed in a
printing or at a technical conference will not be considered
to have lost novelty if a patent application is filed
for the disclosed invention is filled within 6 months
from the date of disclosure.
In practice, the invention
for which exception to the loss of novelty is claimed
in an application may not be exactly the same as the
previously disclosed invention. Thus, for encouraging
research and development, exception to the loss of novelty
is also applied to an invention is obvious from the
disclosed invention. Therefore, Section 29(2) (provision
for lack of inventiveness step) of the Patent Law will
not be applied to such an invention.
3.
Treatment of Inventions Disclosed through Internet (revised
1999, effective as of January 1, 2000):
Since a large quantity
of information are available through Internet at the
present time, it is confirmed that the invention disclosed
through Internet will be treated in the same was as
that disclosed in a printed publication.
Specifically, Section
29 of the Patent Law is amended to read:
"an invention which
is described in a distributed publication or become
available to the public through electric telecommunications"
Similarly, Section 30
of Patent Law regarding exception to the loss of novelty
is amended to read:
"published in a distributed
publication or published through electric telecommunications."
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