Notes from Day one of WIPO SCP 13

WIPO’s five day 13th meeting of the Standing Committee on the Law of Patents (SCP) began on Monday, and will go through Friday. The agenda is quite full, as the SCP will consider four important reports written by the Secretariat.

SCP/13/2: Standards and Patents
SCP/13/3: Exclusions from Patentable Subject Matter and Exceptions and Limitations to the Rights
SCP/13/4: The Client-Attorney Privilege
SCP/13/5: Dissemination of Patent Information

The first report that is being discussed is SCP/13/3, on limitations and exceptions. The comments from countries and NGOs on L&E will continue on Tuesday. This is the first time that WIPO has looked at this issue in depth since an earlier pre-TRIPS effort to harmonize exceptions, The WIPO Report on the topic is not bad, but does lack detail in some important areas. For example, there is no discussion of goods in transit, a hot topic these days following the seizures of generic drugs in the Netherlands in transit from India to developing countries.

No discussion of Part III TRIPS Flexibilities
The WIPO Report does mention that “in the United States of America, a third party who uses a patented invention in the performance of a Government contract in effect obtains immunity to liability for patent infringement of the patent. This is based on 28 USC §1498(a).” But the WIPO report does not mention that this flexibility is allowed under Article 44.2 of the TRIPS. Nor does the WIPO Report discuss the new practice in the United States to consider a compulsory license as an alternative to the granting of an injunction to enforce a patent, under the 2006 US Supreme Court decision in eBay Inc. v. MercExchange, L.L.C.. This is in fact the fastest growth area for compulsory licenses in the world, with non-voluntary authorizations to use patents recently granted to Microsoft, Toyota, Johnson and Johnson, Abbott Laboratories, Direct TV and others, including those that allow exports outside of the restrictions of Article 31(f) of the TRIPS. Under the eBay standard, before an injunction is granted, a plaintiff must demonstrate:

(1) that it has suffered an irreparable injury;
(2) that remedies available at law are inadequate to compensate for that injury;
(3) that considering the balance of hardships between the plaintiff and defendant, a remedy in equity is warranted; and
(4) that the public interest would not be disserved by a permanent injunction.

This decision has effectively made every request for an injunction a potential compulsory licensing case. The several “running royalty” compulsory licenses issued by US judges are allowed under Article 44.1 of the TRIPS. This is not mentioned at all.

No discussion of curbs on TRIPS Flexibilities in Bilateral, Regional and Plurilateral Trade Agreements.
Highly relevant to everything mentioned above and all other L&E issues are the recent curbs on limitations and exceptions that are being included routinely in bilateral, regional and plurilateral trade agreements, such as the recent FTA, EPA, and ACTA negotiations. Nor is there any discussion of the US Speical 301 list or the planned EU version, which uses unilateral pressure on countries to forgo flexibilities.

Sector specific limitations and exceptions and non-discrimination provisions in TRIPS
Many of the examples of state practice cited by WIPO involve sector specific exceptions or compulsory licensing laws. In Article 27.1 of the TRIPS, there is an important provisions that says “patents shall be available and patent rights enjoyable without discrimination as to the place of invention, the field of technology and whether products are imported or locally produced.” WIPO does not mention the tension here, even though this was the topic of a WTO case involving patent limitations and exceptions, and it is something that developing countries are often lectured about by US and European trade officials.

There are other areas where the WIPO report can be strengthened. That said, it is a useful first step for the SCP in an area that has been avoided for many years.