The current President of the EPO claims in his blog that there is a general demand from the users of the EPO – i.e. primarily the applicants – to have a timely delivery of the work product of the EPO. In his words (emphasis added):

But, as with any good service, good products need to be delivered on time. This is particularly so for our users, as innovators and investors look for certainty at an early stage in the process…. Timeliness is therefore a key issue not just for applicants, but also those potentially affected by pending patent rights. Our users have stressed that it is a priority for them and, as such, timeliness is a priority for the EPO.

Based on this premise, the President derives the aim of speeding up all EPO proceedings. In July 2014, the program “Early Certainty from Search” was introduced that is aimed at providing a search report with a preliminary opinion within six months of filing. This idea of streamlining the procedure has now been expanded to the examination and opposition stages. Key to the EPO management’s agenda are two targets:  

For examination, grants will be concluded on average within 12 months after the start of the examination procedure.

For Opposition, we have now committed to ensuring that the overall duration of the procedure is reduced, from the current 26 months for cases with no specific legal complications, down to just 15 months.

In my personal opinion, receiving an early and well-reasoned search report is, indeed, of great value for many users of the EPO. However, as concerns the examination stage, there are practical consequences of the President’s program, which may, in fact, be highly undesirable and will not be liked by applicants and their representatives. 

First and foremost, it is my impression that the pressure exerted by the “Early Certainty” program on the work output of examiners has considerably increased. Perhaps unsurprisingly, several colleagues of mine have started to observe that the quality of the reasoning and the depth of analysis of official communications at least in some technical areas has been declining to a noticeable degree. This is exactly what should not happen. Superficial examination, whatever its outcome may be, helps no one.

Additionally, we are currently experiencing a significant surge in summons to oral proceedings by examining divisions in some technical areas. Some of my colleagues have received the same number of summons by examining divisions in the last half year that they had received in the previous ten years. And not only the frequency of summons is without precedence, but also the stage of the procedure at which summons are issued. Of nine summons received by one of my colleagues for oral hearings before examining divisions this year, five were issued after a single (!) examination report under Art. 94(3) EPC. Such early summons, on such a broad scale, are unheard of and certainly not welcomed by applicants. 

Fortunately, this new practice has not been implemented with the same rigorousness in all technical fields (“clusters” in EPO speak). And it should not (principiis obsta)! This is because such a change in practice would have quite dramatic consequences for applicants and their European representatives, particularly if it is implemented all of a sudden rather than gradually over some years.

a) Workload

An obvious and immediate consequence of the above procedural changes is that both external counsel and in-house patent departments will face a surge in workload in the near future. Proceedings that used to have an average duration of maybe four to five years are now to be compressed into a single year, on average. This means that at least for the “ramp-up” phase of the new system, the frequency of communications, and thus the workload, will significantly increase. 

In addition, the high frequency of summons to oral proceedings would greatly add to this effect. The workload associated with a summons to oral proceedings is much higher than the work required to respond to a “normal” communication, owing to the simple fact that the applicant has one last possibility of presenting written arguments and amendments in the final written submission before the hearing before the EPO has the power to reject the case. The assessment of late filings by the Boards of Appeal, at the same time, has become much stricter over the past years. Hence, the last written submission and the requests included therein should foreshadow not just the oral proceedings, but also a possible appeal. Needless to say, the preparation for the oral proceedings itself requires significant efforts. This is because one has to think about all eventual outcomes, bearing in mind that the examining division has the power to raise any additional issues or arguments, at their discretion, during the hearing.

b) Budget

When the workload for external counsel and in-house patent departments suddenly increases by a dramatic change in practice by the EPO, the allocated budgets, based on long-term experience with the EPO, will become moot and insufficient. Whilst a standard reply to an examination report may be well be within the capabilities of the in-house patent department, preparing a final written submission and for the oral proceedings will typically require substantial input by outside counsel. This results in a dramatic rise in costs for the proceedings, at an early stage. This is particularly the case since a summons at an early stage when multiple objections are still unresolved means that on average the cases are more complex at that stage and this further increases the costs.

Corporate users of the EPO plan their budgets ahead, typically for a fiscal year. And a budget can only be spent once. When there is an unexpected rise in the costs for pending procedures, there is only one way to react, when trying to stay within the budget: stop any spending on new projects. This means that the waste of resources on unduly early summons and rushed proceedings will have a negative impact on the possibility to file new cases. Thus, “early certainty” is likely to be detrimental to innovation and furthering research, at least for several years to come.  

c) Time-pressure

It goes without saying that the proceedings, if compressed by a factor of four to five, will further be affected by tremendous time pressure. An early summons means that the applicant has to decide on its strategy for the case very rapidly and at a very early stage of the proceedings, where it may perhaps not even be clear which of the embodiments disclosed in the patent will eventually make it to the market.
 
d) Conclusion

In summary, I am afraid that the “early certainty” program in examination proceedings, at least if implemented as described above, i.e. if it results in a significant increase in the number of oral proceedings at an early stage of the examination proceedings, will – needlessly – have quite significant negative consequences for most applicants. In my view, there is no need to introduce such an “early certainty” program in examination proceedings at all, provided that the EPO continues its previous practice to accelerate examination proceedings when so requested by the applicant (via a PACE request) or a third party (via observations under Art 115 EPC).

This would also give the examiners the necessary leeway and resources to speed up those (usually more important) cases where an actual dispute needs to be quickly resolved, i.e. contentious examination proceedings and opposition proceedings.

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8 comments

  1. I fully agree with the author. In addition, the dramatic and unexpected increase of grants puts a pressure on the budgets : more validation costs, more oppositions to file.
    Regrarding oppositions, not only the number of patents gets higher, but as their quality is lower, the proportion of patents to oppose will also increase.

  2. I totally agree with Dr. Bausch. We have internally discussed not only problems with early and unnecessary summons to oral proceedings, but especially the decreasing quality of search reports and search opinions: often no attention at all is paid to the dependent claims, which are sweepingly declared to refer to minor design issues, even when this is clearly not the case. Even the independent claims are sometimes dealt with in an apparently careless manner.
    I once had a boss who did not want to spend more resources on the patent department and who tried to solve backlog problems by declaring that priority should be given to certain tasks. At the end of the day all tasks had to be handled with priority. Not very surprisingly, this had an impact on quality.

  3. I consent to that. None of my clients desire a force-closure of the examination proceedings within 12 months. Those who are interested in swift examination proceedings waive their right to receive a Communication under Rule 161 or 70 EPC, file PACE requests and provide quick instructions to Examination reports. None of the PACE proceedings that I’m in charge of leave anything in demand with respect to the speed of the proceedings.

    In my daily practice I also observe an erosion of the quality of examination as well as a rise in prematurely issued Summons to Attend Oral Proceedings. Sometimes this results in a hectic series of informal interviews in order to just settle the case (or the remnants of it) for now and the subsequent filing of a divisional application. In fact, divisional applications are about to become the only recourse for applicants to ease this situation. Filing (a series of) divisional applications, however, is a pretty expensive strategy. This leads to the situation that the “early certainty” strategy of the EPO in examination proceedings discriminates applicants that are SMEs, universities and private applicants.

    Hence, speeding up examination proceedings just for the sake of bragging with production figures fixes a problem that nobody has.

    1. Thank you. And if you consider the most recent statistics of the EPO that just came out and show that 40% more patents were granted last year than in the year 2015, this will give us a feeling about the order of magnitude of the problem…

  4. The idea of early certainty for search is, as such, not bad. It is important for an applicant to receive a good search report as soon as practicably possible, accompanied by an equally good opinion on patentability. But a thorough examination is as important and not just a useless play with words.

    Reality shows that in lots of cases the search is done in a very slovenly way, and any reason to stop the search is a good reason. For instance finding an X document means in general that the search is stopped very early. When the independent claim is not patentable, then none of the dependent claims are. Why then bother with the latter and give a full view on all the claims?

    Even if later it turns out to grant, the clarity of the dependent claims is simply forgotten, with all dire consequences in opposition. Why do you think that in G 3/14 the President has considered it necessary to have clarity examined for every patent opposed? Simply to try to weed out for opposed patents the blunders made during examination.

    In one case, the search examiner has cited as an X document a publication of the inventors. The problem is simply that the document was published, for good reasons, after filing! Unbelievable, but true. This is certainly not what it should be. You can guess that the corresponding opinion was of the same quality. It might look prima facie as a single incident, but it is simply exemplary of what happens now on a large scale.

    Just watch out if the documents cited on the search report are not family members of the documents having been found during other searches, the result of which has to be communicated to the EPO. It is an old trick, but it works.

    I am not entirely blaming the examiners, as they are caught in a system which has degraded them to chain workers. The machine is simply getting mad, and if any examiner does not want to be left behind, meaning that he will get no bonus, or even will be considered incompetent, he has to follow the system. They have nevertheless for a vast majority accepted the system.

    Summons to oral proceedings are merely used to twist the arm of the applicant or its representative. If you do not come to oral proceedings, then your application will be refused, and then you can only continue by filing an appeal. The costs are for you, and we do not care about this point.

    If the Board of Appeal is of another opinion, he will in general remit the case back, either with the order to grant or to continue proceedings. If a case comes back from the Boards of Appeal, unless it is to merely adapt the description to the claims, the counter is reset and the examiner receives the full allocation of points for a final action (grant or refusal) when he has been ordered to continue the procedure. This is valid even if the examining division has committed a substantial procedural violation! Hence the production can be increased again, not only for the single examiner, but also for the directorate. The director will thus not complain at all.

    The idea of early certainty of search and examination has sprung in the minds of the top management of DG1, and has been fully endorsed by the President. It is all benefit for him: the production looks good, and since grant has occurred, the validation states are happy as well, as money flows as early as possible to them and not to the EPO. May be an increase in the procedural fees will have to be decided if hardly any direct revenue from renewal fees comes to the EPO?

    There is one question to be asked: who are the users who have stressed that it is a priority for them [to obtain a quick grant] and, as such, timeliness is a priority for the EPO? One could accept it, if the quality would be there, but alas, this is not any longer the case.

    Beside the meaningless quality marker under ISO 9000 which is regularly trumpeted to be excellent, the EPO should publish the real quality statistics which are set up by the audit department. The figure will probably look quite different, hence a reason why they are well kept secret.

    The tragedy is that SMEs are the direct victims of such a system. Either they get applications refused for flimsy reasons, and often cannot afford to appeal. They may also get patents which are hardly enforceable, as not correctly examined, or they are confronted with patents which are so broad that any attack can bring them on the brink of collapse. We are always told that the EP and UP (so far as it will materialise) systems are good for the SMEs, especially European ones. The contrary is true, as the examiner has no time to consider the application as he should do. I am not pleading that an examiner should give more time to an application coming from an SME, but what is happening now, is directly detrimental to SMEs.

    PACEing every single application is against the needs of the users, but they are there to pay and shut up.

    It is high time that the profession says something, and does not continue to look at the disaster without reacting. It is good that Mr Bausch has taken up the issue. It might be difficult in the long run to get applicants to pay for such a mediocre quality, and one might see in a long run a return to national filings, especially if the number of states in which a validation is envisaged is small. Then good by EPC and UPC.

    The problem is that certainty of everything is ending in certainty of nothing, but the production figures are excellent. It just depends under which point of view one looks at them.

  5. In reply to Not Indifferent’s mention of a possible return to national filings: me and most of my colleagues (based in Spain) have traditionally preferred the EPO for first filings, at least in part due to the value of the search report and, to a substantial extent, the search opinion, including the examiners’ views on issues like clarity and inventive step. However, lately we have started considering using the Spanish PTO as an option for the first filing. We actually think that at present the Spanish PTO may provide equally good or even better search results.

  6. Thank you so much for your support.
    The situation is unfortunately getting out of control at the EPO.
    Management is coming up everyday with new ideas to speed up grant. For example, I hope you are fully aware that from 1.12.2016 also a phone call from us may be considered as first action in examinination (ppn12/2016). This means that we can summon oral proceedings after you get our minutes for the telephone conversation.
    We cannot stop this alone. Please help us to put an end at it.
    Thank you

  7. It was a long standing policy decision that the first action of an examining division could not be a phone conversation. it is only in case of possible grant that small formal amendments should be introduced at the R 71(3) stage, but they had to be discussed with the applicant before sending the R 71(3) communication. Another form of twisting the applicant’s arm…..

    The problem with minutes of telephone conversations is that in the vast majority of the files they are not a true account of what was discussed, but give only the result of the discussion. This makes it difficult for third parties to understand why an examining division comes to grant. It does not seem that this slapdash way of minuting has improved, and looking at files, it has rather gone worse.

    The reasons why a decision to grant has been taken are as such not public. It must however be clear from the evolution of the file what lead to grant. When there are only sweeping statements about dependent claims, it is easy for an applicant to say that they were not justified and then the applicant combines the original independent claim with a dependent, and then a grant follows. For what reason? God knows.

    If the EPO claims to be transparent, a first action might be to publish the reasons why an examining division decides a grant, not only the page containing the signatures of the members of the examining division (page 4 of Form 2035) but also the reasons why the examining division considers that a patent can be granted (page 1 and 2 of Form 2035). Why is the public only informed of the reasons why an application has been refused? It should also be aware of the reasons having led to grant.

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