Software Patents in Israel – Guidelines on Hold

February 7, 2011

The last act before leaving office of the previous commissioner, Dr Meir Noam, was to announce that there was a new policy regarding the patentability of software inventions and that guidelines would be forthcoming by the end of January. 

See Patentability of Software – Notice from the Israel Patent Office for more details.

 In a not totally unexpected move. Dr Guy Rotkopf has announced that the guidelines are delayed.

It is not clear when the guidelines will issue, but we will endeavor to report developments whilst they happen!


Merck’s patent application for once-weekly alendronate (Fosomax) successfully opposed in Israel

August 10, 2010

WO/1999/004773 titled “Method for Inhibiting Bone Resorption” is a patent application to Merck for a once weekly oral dosage pill for alendronate and other bisphosphonates for the treatment of Paget’s disease and osteoporosis and was filed in Israel as a national stage entry of the PCT as IL 153109.

Alendronate is marketed by Merck as Fosomax®, which has annual worldwide sales of over one billion US dollars.

Once granted, the application was published for opposition purposes, and both Teva and Unipharm, Israel’s leading generic companies opposed the application. We note that Unipharm was responsible for the cancelation of the basic alendronate patent in the Israel Supreme Court. As would be expected, Merck was represented by Richard Luthi, Unipharm by Adi Levit and Teva by Tal Band.

The main claim is as follows:

A pharmaceutical composition useful for inhibiting bone resorption in a human comprising from about 70 mg to about 140 mg of alendronic acid or a pharmaceutically acceptable salt thereof, or a mixture thereof, on an alendronic acid active weight basis, in association with a pharmaceutically acceptable carrier, wherein said composition is adapted for oral administration as a unit dosage form according to a continuous schedule having a periodicity selected from once-weekly dosing and bi-weekly dosing.

The grounds for opposition were lack of novelty, lack of inventive step, lack of utility and non-patentable subject matter. The Commissioner of Patents, Dr Meir Noam, complimented all the expert witnesses, both those recruited locally and those flown in from abroad, for their objectivity and professionalism, and pointed out that he had spent 12 days conducting oral hearings.

In his ruling, Dr. Noam concluded:

  1. That a specific formulation indicated for a specific dosage regime was patentable subject matter in Israel, and fell outside the ambit of section 7(i) which excludes methods of treatment of a human from patentable subject matter.
  2. Although there were suggestions in the literature – specifically in a professional journal called Lunar – to try administering a higher dosage less frequently, including once a week, as away of overcoming certain side effects, these were insufficient to rule out absolute novelty.
  3. The combination of the Lunar references and some of the previously reported filed tests were sufficient to render the invention obvious and lacking in inventive step, since although some of the papers indicated that a higher dosage would cause more gastrological irritation, there was sufficient evidence that the problem was caused by pills sticking in the throat, and so the frequency of dosage was more significant than the size of the dose. This coupled with the well established long half-life of the drug and the Lunar publications actually making the suggestion rendered the idea of reducing the frequency and upping the dose obvious to try. Furthermore, the 70 mg dose and once week administering of the treatment were both found in the literature.
  4. Having ruled the claimed invention as lacking in inventive step, the question of utility was moot, so Dr. Noam excused himself from ruling on the hundreds of pages of evidence submitted on the issue by both sides.

One interesting argument, put forward on behalf of Unipharm by Adi Levit, was that Haber’s rule applied, i.e. that  ”the time of exposure makes the poison”. In other words, where the problem is local irritation, a higher dosage for a shorter exposure time is likely to be beneficial, and thus there was no invnetive step. Merck tried to get this argument suppressed on technical grounds, claiming that it wasn’t in the original opposition as filed.

After ruling the patent invalid, the opposers, Teva and Unipharm, were given 30 days to submit breakdowns of costs incurred.

The case: Opposition to IL 153109 to Merck, titled “Pharmaceutical Composition Useful for Inhibiting Bone Resorption in a Human Comprising Alendronic Acid or a Pharmaceutical Acceptable Salt thereof or a Mixture Thereof”.

COMMENT

The decision as to lack of inventive step is clear and correct. We note that the same patent was disallowed in Korea and the UK as relating to a method of treatment, and in Europe as lacking inventive step. Dr. Noam is correct, however, that a decision in Israel should attempt to interprete the local law in light of local precedent, and that the courts and patent office should be aware of but not bound by decisions in corresponding cases in other jurisdictions.

The applicants claimed that Circular MN 30 allows Swiss type claims, i.e. new uses for old treatment, and the claimed invention was directed to a formulation. I tend to side with the opponents though and find the Commissioner’s ruling on this point not convincing. I see this as a patent for a method of treatment where the dosage regime is an inherent part of the treatment, since the product lacks inherent novelty, and the novelty is a function of the dosage, which is a method step. Arguably, however, because of the long half life, the product is the high dosage pill – regardless of the exact dosage regime.

There is an underlying issue of principle as well. Is it good public policy to allow a manufacturer to ‘evergreen’ by changing dosages and making similar ‘inventions’ to keep a product under patent protection indefinitely?

Section 7(i) strikes a balance between the rights of doctors and their patients on the one hand and those of manufacturers on the other. With Israel’s pharmaceutical industry being heavily skewed towards generic manufacture it is certainly preferably politically to refuse a patent like this on grounds of inventive step rather than on patentable subject matter which could be viewed as protectionist.

That said, the issue of patentable subject matter is a ‘hot potato’ that may require updating from time to time, due to TRIPS, world wide developments and as economic issues change. Nevertheless, I think that interpreting claim 1 as not being a method of treatment goes beyond fair interpretation of the Law and as such, the revision should be for the Legislature not for a Commissioner of Patents to decide. That Dr. Noam has chosen to allow Swiss type claims is indicative of Patent Office Policy but should not be sufficient to overcome Section 7(i) which is a clear statement. In this regard however, it is noted that Israel Patent Law is not frequently the subject of Knesset debate, so creative interpretation is probably required to keep practice up to date.  

The applicant is correct that a new dosage of an old treatment is patentable, but I believe this should be true only if the dosage is indeed new. If the dosage existed previously for a different administration regime, the pill is not new. Only the method of treatment is.


Re Bilski – Not worth the wait

June 29, 2010

On the last day of their sitting, the United States Supreme Court issued the long-waited Re Bilksi decision.

Essentially, Mr Bilski tried to get a patent for hedging, particularly as applied to energy resources. The examiner, the USPTO on Appeal, the Court and the Federal Circuit Court of Appeal (en banc) all held that the invention claimed was not patentable subject matter.

Many observers, including myself, were somewhat surprised that the Supreme Court, which hears maybe one patent case a year, decided to hear this one.

The possible ramifications were wider than Bilski. We wondered whether business method patents per se. – which issued in the US in large numbers over the last decade would be voided or upheld; would software per se. be patentable or would it require to be tied to a particular machine? What about gene sequences and other biological discoveries that arguably were not inventions, and could not fairly be described as processes, new matter, machines, etc.

In the event, perhaps wisely, the decision was to uphold the invalidity of the specific Bilksi business patent as being an abstract idea or not a process, and therefore outside the scope of patentable inventions. The Federal Circuit’s attempt to tie patentable subject matter to technological areas (Meyer) or to the machine or material transformation test was, however rejected. The transformation test remains a useful symptom of patentability but is not axiomatic. It is not in the US Constitution or in the Patent Law, nor is a technological requirement. These indications of patentability are helpful but not sufficient.

Since business method patents are still allowable per se. Those allowed until now have a presumption of validity, but one would be wary to sue others based on them since there is every likelihood that they would be invalidated by the court. Indeed, with a 40% reversal rate on appeal in the US, the presumption of validity is not strong anyway.  

Patent attorneys like myself who cannot understand when to consider an applied method is to be considered an abstract thought and when it is a process will have to tell applicants that the issue is not yet resolved, try to discourage them from filing, and then, since we are professionals in an intellectual version of the oldest profession, simply pocket our fees and try our best.

The case was the wrong to hear and the judges declined to say anything of substance. There were a few interesting facts, like a pre 1790 patent in the UK for a business method,  but long-awaited decision actually clarified very little.

Congress should now amend the Patent Law and introduce definitions. Patentability is, afer all, a matter of policy. Oddities like grace periods and first to invent could be scrapped.

One good way to adopt a fairly sensible system would be to adopt the European Patent Convention. Can’t see it happening…

Many of the arguments used in Israeli decisions and patent office circulars were rejected by the US Supreme Court that saw itself as not being authorized to add terminology into the Law.  I am not sure that business patents or software per se. which the Israel Patent Office considers not patentable subject matter should not be. Nor am I convinced that gene sequences are not better understood as discoveries than inventions.

The trouble is, of course, that the commissioner of Patents, possibly does n’t have the authority to do what he does, but despite arguably lacking legal competence, he is professionally competent. The courts here are not. Nor, from some of their arguments, are the justices in the US.

 The 71 page decision was worth reading. Some paragraphs were even somewhat amusing (in a dry academic sort of way). Does it ellucidate much? No. Worth waiting for? Hardly.


UK Patent Office to share work with the USPTO and JPO

March 12, 2010

The UK Intellectual Property Office (IPO) has announced that the pilot work-sharing programme, the Patent Prosecution Highway (PPH), between the IPO and the Japanese Patent Office  has now been made permanent. Under (or should that be on???) the Highway, once an applicant has received a favourable decision from one office they can request accelerated processing of corresponding patent applications filed in the other, which should significantly speed up the patent prosecution process.

Source: IPO press release, 10 March 2010.

Additionally, the US and UK have now agreed to co-operate on patent processing, with the  two governments having announced that their respective patent offices, the US Patent and Trademark Office (USPTO) and the UK Intellectual Property Office (IPO), will co-operate to develop a plan to optimise reuse of work on patent applications that are filed jointly at the USPTO and the UK IPO. 

The offices will try to identify all potential areas of information utilisation by the end of 2010, and will work on building mutual confidence in the work done by each office.

Source: IPO press release, 10 March 2010.

Under Section 17c of the Law, the Israel Patent Office will grant an Israel patent having the same specification and claims to one allowed by a range of jurisdictions, including the JPO, USPTO and UKPTO, unless the invention relates to subject matter considered non-patentable under Israel Law, such as methods of therapeutic treatment, business methods and software per se. (all currently patentable in the US).  

None of the jurisdictions listed currently take much note of what the Israel Patent Office allows or not, albeit the IDS in the United States does have to relate to the citations from Israel as elsewhere. Now that Israel is becoming an International Search Authority for the PCT, it is possible that other countries will be prepared to rely more on the Israel Examination. 

Australia has a modified Examination procedure like Israel, and will grant a patent based on allowance elsewhere. At present Israel accepts Australian examination.


Israel Commissioner Limits Possibility of Filing Divisional Applications to Lifetime of the Parent Application

February 18, 2010

 Section 24a of the Israel Patent Law 1967 allows for filing a divisional application at any time up to a patent application issuing.

In the interests of clarifying the scope of protection, in Circular 81, the Commissioner of patents has ‘clarified the ambiguity of’ this Section of the Law by interpreting it to mean that divisional applications can only be filed prior to the parent application issuing.

Comment

With the proposed amendment allowing for 18 month publication, this measure is clearly required. Nevertheless, I am not convinced that this is interpretation of the law, but rather amendment thereof.

Arguably this measure requires a formal amendment to the Law by the Knesset and goes beyond the authority of the Commissioner. It should be included in the proposed amendment for 18 month publication (second reading) and it would be fun if someone challenges this Circular on procedural grounds.


U.S. Patent Office cancels some of the claims in the Viagra patent

February 17, 2010


An appeals board of the U.S. Patent and Trademark Office (USPTO) has partially rejected a patent on Pfizer Inc’s impotence drug Viagra because it works in a way similar to the Chinese herb Yin Yang Huo, otherwise known as Horny Goat Weed. See http://en.wikipedia.org/wiki/Epimedium for details of this plant.

This February 12 decision upheld an earlier finding that an element of the Viagra patent did not represent a new invention.

Interestingly the claims were cancelled following the patentee, Pfizer, filing a patent infringement lawsuit against rival pharmaceutical company Eli Lilly and Co, which makes the competing drug Cialis.

The board of patent appeals ruled that a chemical ingredient of Yin Yang Huo, which is used to treat impotence and sometimes sold as an alleged aphrodisiac, is similar to the enzyme inhibitor found in Viagra.

The Pfizer patent which is not due to expire until 2019, enables Pfizer to maintain a monopoly on sildenafil (Viagra) which is apparently used to treat erectile dysfunction. Last years sales of the drug in the US exceeded $2 billion.

There are apparently a lot of horny old goats out there…


The Strange Affair of Israel Patent Application Nos. XXX and YYY to ZZZ

January 8, 2010

Under the Israel Patent Law there is a provision whereby sensitive patent applications affecting national security and the like must be first filed by Israeli inventors in Israel, and the patent office refers such applications to the Minister of Defense who have six months to decide whether to ‘classify’ the application and issue a gag order, preventing the application from being filed abroad or otherwise published.  If the Ministry of Defense does not issue such an order, the application may be filed abroad.

 

Whilst many applications of possible military significance are forwarded to the Ministry of Defense, it is fairly rare for applications to actually be classified, and generally, after six months, the applicant can proceed with his invention.

 

Z had three such applications, all filed in 1981. The first was abandoned, however the other two were eventually were examined and allowed. The State of Israel never did not do anything with the inventions, and only some 12 years later, lifted the restrictions. Z himself did work to bring a product to market, even after the restrictions were lifted.

 

There is a committee that very occasionally convenes to rule on appropriate compensation. The committee, in its current constellation, rather different from that that first deliberated on this issue, has now issued a ruling and this article reports on the deliberations and ruling of the compensation committee regarding this claim.

 

Since there was no utilization by them, there is no patent royalty payable by the State. Z claimed 22 million dollars compensation for damage caused by the restriction order; the sum being an estimate of anticipated profits had the invention been commercialized.

 

According to the decision, after their allowance, the State of Israel requested re-examination of the patents. However, the patent office refused, pointing out that the Ministry of Defense could have conducted secret opposition proceedings, and presented a basis for their claim of invalidity.

 

The patents are therefore valid, but Z apparently did not produce adequate justification for the compensation claimed.

The committee offered to pay for an expert acceptable to Z to do a valuation, but Z didn’t take up this offer. However, when given another opportunity to base his claim for compensation, he provided details of direct expenses laid out, based mostly on 1700 hours work at his consultancy rate of $250 and requested compensation, regardless of culpability of the State. 

 

Z could only produced one receipt showing that in 2005 he could bill at $250 an hour for consulting. The State claimed that the expenses were inflated and not substantiated.  Z claimed that the very fact that a restriction order issued, was grounds for statutory compensation.

 

The case hinged on whether real damage had been done. Could the plaintiff prove his case? Should the fact that the State effectively prevented him from attempting to monetize his invention be taken into consideration when any damage was purely speculative, since there were no sales?

 

The committee appeared to be very uncomfortable with the case before them, but noted that Z was represented by a prominent and very experienced IP litigator and that the Israel system is adversarial and not inquisitional, so they could only rule on the basis of the claims made evidence submitted by the parties.

 

The committee ruled that the law could not be understood as indicative that any application that becomes ‘classified’ automatically deserves compensation as that would be an incentive for filing spurious military inventions. After rejecting that compensation was forthcoming under property rights, unjust enrichment and the like, the committee nevertheless decided that some sort of compensation was in order, and ruled that the wording of the law gave them the rights to rule on compensation based simply on the rule. They assumed that the 200 hours taken to develop the 3rd invention, after the second was conceived, was a reasonable assumption to decide that of the 1700 hours, 1300 were spent on the first, non-compensationable invention, and 200 on developing each of the 2nd and 3rd inventions – bearing in mind the time between the first and subsequent filings, this is not unreasonable.

 

Noting that consultancy fees of $250 or NIS 1000 an hour, obtainable 20 years later after much experience was not a fair basis for calculating how much Z’s time was worth at the time of filing, the committee dismissed this hourly rate as being fanciful.

 

For lack of any better tool, the committee used the most generous Central Govt. Statistics hourly rate of an employed researcher with a Ph.D. in a comparable field in 1981 - the time of the invention. The figure decided upon, and stressed as being the most generous figure they could find in any comparable job description was 6.7 NIS. The committee index-linked this sum, added interest and came up with the almost arbitrary figure of NIS 67,000 which is close to $20,000, or about 1000th of that claimed. 

In the circumstances, they ruled that awarding costs was inappropriate. 

 

Comment

 

Public security should certainly override personal enrichment, and the restriction order, which has its parallels in other patent systems, is therefore reasonable. However, presumably there was some value to the technology or the restriction order would not have issued.

 

The main problem with critiquing the decision is that there are too many unknowns. Was the invention valuable or worthless? Did the Ministry of Defense simply lose the file, or had they tried to implement the invention and only on failing to do so, decided it was worthless. There are, of course, a large numbers of patent applications that are filed that have dubious scientific basis. Many more are not commercially practicable.

 

That said, I am not convinced by the court’s assertion that pending patents cannot be considered property and that they only become property on issuance, and therefore preventing a patent for issuing does not mean that there is no tort under property laws. There are well established speculative markets for options, futures, bonds and the like. I do not think that a patent issuing creates property. Rather it assigns property created by invention to the inventor/applicant for a period of up to 20 years.

 

Whereas many patent applications do not result in commercial goods, there are inventions that have real commercial value and where the inventor is prevented from commercialization by the State, it is difficult for a committee to determine the worth of the invention.

 

Counsel for Z is an eminent IP litigator but is not a scientist. Neither are the committee members. Valuable inventions often appear to be light years away from commercialization at the time of conception, but some are eventually commercialized.

The invention may have required significant development and perhaps was not enabled. The application may, therefore, have been invalid on the grounds of lack of enablement. It’s difficult to tell without running experiments or examining the case. I don’t think the examiner or the committee could tell either.  In cases like this I am not sure whether the attorneys argue the law theoretically, or whether they have full access to the application as filed. I am not sure that it would necessary make a difference.

 

Did the Ministry of Defense attempt to develop the invention and subsequently determine that the concept was fundamentally flawed? Was the application overlooked for 10 years due to applicant negligence, compounded by his attorney, as may be inferred from the decision, or was there nowhere for the applicant to turn? Maybe, he worked on other inventions and this was side-tracked, but was, nevertheless, potentially valuable, and were the military to have encouraged him, could have had real value? The Ministry of Defense argues that even with the patent application restricted, the inventor could have manufactured and requested an export license. I think this may be true, but is irrelevant since without a patent portfolio, manufacturing would have rendered development and marketing pointless. 

 

A famous and significant case regarding restricted inventions was an invention by the actress Hedy Lamarr, the actress who starred in Ecstasy and went on to play Delilah in the Cecil B. de Mille epic.

 

Whilst married to Mandl, a prominent German arms dealer and Nazi sympathizer, and the first of six husbands, she overheard discussions on the problems of torpedo navigation and together with magician George Antheil who provided enablement based on the drum of a mechanical piano, filed a patent application for frequency hopping in 1941, that issued a year later as US 2,292,387, but was restricted for decades. It is now widely used in mobile telephony.

 

Incidentally, instead of using her inventive talent, the US Government decided that her contribution to the War Effort would be selling kisses for War Bonds.


Patentability of human stem cell research referred to the European Court of Justice

November 18, 2009

Greenpeace considers that the German patent office was wrong to issue a patent number DE 19756864 to Oliver Brüstle, and the Germans have turned to the European Court of Justice for a ruling concerning Art. 6 of Directive 98/44/EC which relates to the legal protection of biotechnological inventions.

There are ethical issues concerning patentability of medicine and medical research and granting a monopoly on a treatment, which are generally bypassed with Swiss type claims. The issue here relates to public morals concerns with destruction of fertilized human egg cells, or when an embryo is considered a life.

One cannot get patents for genetic modification of human beings or over human life. The question is what is a human? I think in this issue, the halachic position is actually more lenient than that of the German Law. It is way outside my area of competence though.

In December, we are hosting an event with German Patent Attorney Ulrich Storz and with US Patent Attorney Greg Kirsch to look at whether software, business methods, genes and stem cells should be patentable. No answers, lots of questions.


Round Table on Software Patents at the Israel Patent Office

November 2, 2009

On the 15 October 2009, a round table was held between representatives of the patent practitioner professions and relevant staff of the Israel Patent Office.

Patent Attorney Ehud Hausman took the initiative and worked for 2 years to organize the round table, at which he presented a lecture demonstrating the problems he sees with the current Israel Patent Office practice regarding computer patents, particularly software patents.

Udi together with Michal Hackmey represented the Association of Israel Patent Attorneys. Dr. Kfir Luzzatto and Heidi Brun were also present, presumably as representatives of the AIPPI, as were representatives of the IP section of the Israel Bar.  More importantly, the relevant personnel of the Israel Patent Office, both examiners, the Commissioner of Patents and legal experts were present.

After the event, some members of the AIPA (those lucky enough to be on the mailing list) were sent a Power Point of Hausman’s presentation, which seemed remarkably well put together, and must have been a lot of work. He is thus commended for his initiative.

Briefly, in the past, the Commissioner of Patents has expressed the position that software is protectable by copyright and that it is therefore not patentable by the doctrine of double patenting.

Additionally, software per se. is not considered technical, unless there is a technical effect.

As I have explained in this blog in earlier articles, I consider the copyright double protection idea is problematic since copyright protects the embodiment of the idea and not the idea itself. Why shouldn’t a software invention be protectable against reengineering? Is a 70 year protection against copying of any value in a field where a generation is usually 2 years? Considering software not technical is ridiculous. software is rightly considered an engineering discipline. Since algorithms can be hard-wired into chips or by a machine with valves, the concept of software being different from hardware is somewhat arbitrary. Nevertheless, Lord Justice Jacobs has presented powerful arguments as to why software patents are not in the interest of promoting progress and there is a large open-source community.

The issues are somewhat complicated, and this is not the place to give a full overview of software patenting. However, the issue is a critical one, since Israel is a leading player in software development. We congratulate the organizers on this initiative and hope that the patent office will reconsider their policy and issue clear guidelines.

Nevertheless, I would be happier if Hausman had first presented his lecture to the AIPA at a meeting opened to the members. From reviewing the PowerPoint, I am that many practitioners would have found his lecture interesting. Particularly as many leading Israeli patent attorneys drafting computer applications rarely file and prosecute in Israel. I am sure that quality lectures of the AIPA would lead to high levels of registration. Furthermore, it would be nice if lobbying on behalf of the profession was done by the representative body after giving members the opportunity to express their views.


Israel Patent Office Hosts European Biology/Chemistry Examiners

October 18, 2009

The Israel Patent Office hosted a seminar featuring examiners from the European Patent Office. The focus was on examining chemistry and genetic applications, and presentations covered examining Markush type claims, oppositions and unity of invention.

The presentations were fairly pedestrian and not very exciting. We learned that there is a two year deadline for filing divisional applications, but instead of explaining that annuities were required retroactively, which for the inexperienced can be a nasty shock, or giving useful tips, the presenter labored the straightforward 24 month point with examples! The cakes provided as refreshments were good, but the coffee and tea were Elite Instant, Botz (Turkish-’mud’ coffee, and Wissotzky blue label cheap and nasty tea bags.

One of the examiners spoke briefly in Hebrew albeit with a very strong French accent. the crowd applauded his efforts. Tomorrow, the same presentation is being presented at Haifa university and in Tel Aviv.

In terms of the content, not very interesting and perhaps not worth attending. However, the seminar did provide an opportunity to see the new patent office premises which are very impressive. The lecture theatre seats 120 on leatherette seats. There are good acoustics and nice projector equipment. We hope that the seminars for Examiners only will prove informative and that will improve examining standards.

One clear advantage of the Patent Office hosting seminars for the profession is that people from the different offices feel that the activity is for them, whereas many practitioners feel uncomfortable attending events organized by rival firms. A necessary consequence of official patent office patronage of IP seminars is that controversial and therefore, potentially more interesting topics are avoided.  Indeed, we think that for the patent office to become involved in anything beyond procedure, such as say discussing the scope of patentable material or other gray areas may be problematic as there is a conflict of interest between the profession and the patent office. Like all IP seminars aimed at the profession, the event provided a good opportunity to catch up with acquaintances.


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