Innovation patents in Australia: a piece of cake?
This article first appeared in the Chinese-language edition of Managing Intellectual Property. To download the article in Chinese, please click here.
In the English language there is a commonly used maxim that says “you can’t have your cake and eat it”. In other words, you can’t have the best of both worlds. Now hold that thought and let me introduce you to a curious beast that lives in the land down under – the Australian innovation patent.
In Australia two types of patent are available – a standard patent and an innovation patent. There are some similarities between the two but some important differences.
The innovation patent has a shorter maximum term than a standard patent (8 years as opposed to 20 years) but is substantially identical to the standard patent in terms of the types of invention that can be protected – the only exceptions are plants and animals per se. Devices, methods, pharmaceuticals etc. that can be protected by a standard patent can also be protected by an innovation patent. In this respect, the Australian innovation patent is very different from the Chinese utility model.
The cost involved with securing an Australian standard patent is relatively modest but there is no way of avoiding the cost associated with substantive examination. This examination is mandatory if grant is to take place and the application will lapse if examination is not requested in time. This is not the case for an innovation patent – “grant” takes place after only a formalities examination, usually in a matter of weeks after filing. Substantive examination is not part of the granting process. It should be noted however that an innovation patent cannot actually be enforced until it has been examined by the Patent Office and found to meet the applicable patentability requirements. This process is termed “certification”.
There is no deadline by which an applicant must request substantive examination (certification) of an innovation patent, although it is possible for third parties to lodge such a request. What this means is that it may be possible to avoid the costs associated with substantive examination until it is actually desired to enforce an innovation patent. When requested, substantive examination of an innovation patent is intended to be rapid. An examination report issues very quickly (a matter of months) and any objections raised must be addressed within a non-extendable period of 6 months from the first examination report.
Importantly, the patentability requirements for an innovation patent are somewhat lower than for a standard patent. The prior art base and the requirement/test for novelty are the same. However, for an innovation patent the invention as claimed is required to have an “innovative step” whereas for a standard patent an “inventive step” is required.
The test for an innovative step is really a modified novelty test and there is no consideration of non-obviousness/inventive merit as is the case when assessing inventive step. As recently confirmed by a decision of the Full Federal Court of Australia (Dura-Post (Aust) Pty Ltd v Delnorth Pty Ltd  FCAFC 81), an innovative step exists where the invention as claimed differs from the prior art by a feature that makes a significant contribution to the working of the invention. In other words, if the feature in question makes some technical contribution to how the invention works, the innovative step requirement should be satisfied. The test therefore requires that the invention as claimed differs from the prior art in a way that is not merely superficial or peripheral to the invention.
An interesting consequence of this is that an innovation patent can be used to protect developments of an invention, even if there has been disclosure of the core technology and/or earlier embodiments of the invention. For an innovative step to be recognised the developments must be new and make some technical contribution to how the invention works.
Once certified an innovation patent provides exactly the same rights as a standard patent in terms of the relief available against an infringement (injunctions, damages, account of profits). Furthermore, the same principles of claim construction should apply to an innovation patent as to a standard patent.
There is some flexibility associated with filing of innovation patents. An innovation patent can be filed as the national phase of an international patent application or as a divisional application of an existing standard patent application. It is also possible to convert a standard patent application into an innovation patent, but not vice versa.
Innovation patents can be used to protect inventions that would not otherwise meet the patentability requirements for a standard patent. However, their use need not be restricted to such inventions – innovation patents are potentially powerful business tools and can used strategically to provide commercial advantage for almost the full range of inventions. The following example illustrates this.
An applicant has a pending Australian standard patent application and becomes aware of an infringement. The applicant could seek to push the standard application through to grant and then use it for litigation purposes. However, an alternative strategy would be to file an innovation patent as a divisional application of the standard patent application and seek rapid certification of the innovation patent so that it may be enforced. This has a number of advantages:
- Subject to supporting disclosure, the claims of the innovation patent may be tailored to read onto the infringement during the certification process
- The innovation patent has a lower threshold for validity and may be more difficult to invalidate than a corresponding standard patent.
- Litigation involving the innovation patent will not compromise the standard patent application. Indeed, the litigation may reveal ways in which the standard patent application could be strengthened.
- It is possible to have a standard patent and an innovation patent to the same invention provided that the invention is not claimed in identical terms.
So, the innovation patent is a fast, cost-effective and easy to obtain protection option. It can be a useful tool in supporting the first to marketplace advantage and a strategically valuable asset when it comes to enforcing patent rights. Use of the innovation patent can reduce some of the financial and commercial risks involved in the research and development of a new invention, and allows an innovator to protect each stage of development of an invention. If that’s not a case of having one’s cake and eating it, I’m not sure what is…