J 17/12 – Entry Denied

This decision deals with the question whether a transfer of a European patent application should be recorded in the register although the proceedings for grant have been suspended under R 14.

If you just want a short summary of the Board’s answer, here it is: No.

If you want to know why, please read on.

The application under consideration was filed by Mr Fein in 2006. In 2008, there was a transfer to Reprise Pharmaceutics. On February 7, 2011, a communication under R 71(3) was issued. On March 28, 2011, Ferring instituted entitlement proceedings in the District Court of The Hague. The proceedings were stayed. On April 20, Reprise filed a request to record the transfer of the application from Reprise to Allergan. Allergan requested that the proceedings be resumed. The Legal Division (LD) recorded the transfer but refused to resume the proceedings. Both parties appealed the decision.

Transfer of the application

[2.1] Ferring’s first argument is that once the EPO knew that Reprise’s title to the application had been put in doubt by virtue of the national entitlement proceedings, it should not have accepted on the evidence supplied by Reprise that the application had been transferred to Allergan.

[2.2] The LD rejected this argument and the Board agrees. The general principle under the EPC is that an application for a European patent, as an object of property, is subject to national law and may be transferred (see A 74 and 71). The Board has no reason to doubt that the present application was, as an object of property, transferable to Allergan and that it was indeed transferred, subject no doubt to whatever claims Ferring might establish under national law.

Recording of the transfer in the register: the relevant provisions

[3.1] R 22(1) provides that the transfer of a European patent application shall be recorded in the European Patent Register at the request of an interested party upon production of documents providing evidence of such transfer. R 22(2) provides that such a request may be rejected only if R 22(1) has not been complied with. Subject to Ferring’s argument in point [2.1], above, it is not disputed that the evidence filed by Reprise satisfied the formal requirements of the rule.

[3.2] As to R 14(1), this provides that if the relevant conditions are satisfied (which they were in this case) “the proceedings for grant shall be stayed”. Allergan argues that the recording of a transfer of a patent application in the register is not part of the proceedings for grant. The LD agreed.

[3.3] There are certainly no express provisions of the EPC indicating that R 22(1) and (2) should be put on hold in circumstances where proceedings for grant have been stayed under R 14(1). This is in contrast, for example, to R 15, which expressly provides that in the period during which proceedings for grant are stayed neither the European patent application nor the designation of any Contracting State may be withdrawn.

Recording of the transfer during a stay: the case law

[4.1] So far as the Board and the parties are aware, there is no decision of the Boards of Appeal directly on the point. In the two related cases, J 38/92 and J 39/92, the Legal Board made the general statement that a stay of the grant proceedings has the effect that during the suspension neither the EPO nor the parties can validly perform any legal acts. On the contrary, the grant proceedings remain unaltered in the legal state existing at the point in time of the stay. Taken by itself this general statement might be taken to cover the present case and rule out Allergan’s arguments.

[4.2] It is, however, necessary to have regard to what the facts of those two cases were. A third party had brought national proceedings against the applicant, as a result of which it had obtained a decision of the national court that the two applications were to be transferred back to the third party, and belonged to it (die Patentanmeldung auf die dritte Partei “zurückzuübertragen ist und ihr zusteht.”) The third party had not meanwhile applied for a stay of the grant proceedings but rather, only after obtaining the decision of the national court and then relying on this as evidence, filed a request for transfer of the applications to it. The request was granted but on appeal the Board decided this way of proceeding was wrong: a request under R 20(1) EPC 1973 (now R 22(1)) must be based on evidence of a transfer document, and such evidence was missing. The Board went on to conclude that the request should have been dealt with as a request under A 61(1)(a) by the third party to prosecute the application as its own and that the EPO should have stayed the grant proceedings under R 13(1) with effect from the date of the request. The Board then added the comment cited above, namely that the stay of the grant proceedings meant that neither the EPO nor the parties could validly perform any legal acts and that the grant proceedings remain unaltered in legal state existing at the point in time of stay (“Die Aussetzung des Erteilungsverfahrens hat die Wirkung, daß in dem ausgesetzten Verfahren weder das Europäische Patentamt noch die Parteien wirksam Rechtsakte vornehmen können. Das Erteilungsverfahren verbleibt vielmehr unverändert in dem Rechtsstadium, in dem es sich zum Zeitpunkt der Aussetzung befand.“) See point [2.5] of the reasons in both cases. This was relevant in the particular circumstance of J 38/92 because meanwhile (i.e., after the grant proceedings should have been stayed) the mention of the grant to the original applicant had been published in the Official Journal. The Board thus made it clear this act of the Office had had no legal effect. See points [2.5] and [2(b)] of the reasons and the order, respectively. The factual position was not the same in J 39/92 (where the comment appears in identical terms): in this case there appear to have been no acts by the EPO or the parties which the Board needed to make clear were invalid. The remark therefore appears to have been an obiter dictum.

[4.3] In the light of these facts, the present Board therefore considers that the above general statement cannot be taken as necessarily applying to the facts of the present case. The mention of the grant in the Official Journal, which was the relevant act of the EPO in J 38/92, was undoubtedly a step in the proceedings for grant. It cannot be said with a similar level of certainty that the same is true of the registration of the transfer of the application.

[4.4] Ferring relied on the decision in J 20/05. In that case, the issue was whether an applicant was entitled to file a divisional application at a time when proceedings for grant of the parent application had been stayed. Ferring pointed to the fact that the Board there held that the entitlement to file a divisional application was a procedural right that derived from the applicant’s status as applicant under the earlier application, and thus it had to be examined whether the applicant was entitled to file the divisional application by virtue of being the applicant in the earlier parent application. The Board held that since the rights in respect of a divisional application could only be derived from the parent application, the disputed right of the applicant to file the parent application could not form a sufficient basis for a right to file a divisional application. Ferring argued, applying this reasoning, that when the request to record the transfer of the application was filed by Reprise, there was doubt about who was the person lawfully entitled.

[4.5] While this decision could no doubt support Ferring’s position, the Legal Board there made the point, citing J 2/01, that the entitlement to file a divisional application is a procedural right that derives from the applicant’s status as applicant under the earlier application (point [2] of the reasons). The point was repeated in J 9/12 [3]. The present Board cannot be confident that a right to have a transfer of an application registered following a request under R 22(1), which may be filed by any interested party, is such a procedural right. The Board therefore prefers to approach the question applying more general principles, as set out below.

Stay of proceedings: the general principles.

[5.1] The purpose of R 14(1) is to protect the third party’s interests during entitlement proceedings, at least provisionally (J 7/96 [2.3]; J 15/06 [7]; J 20/05 [3]).

[5.2] Whether or not the recording of a transfer literally constitutes part of the “proceedings for grant” (and thus falls within the express wording of R 14(1)), the decision in J 20/05 demonstrates that the effect of a stay under R 14(1) is not limited to a stay of “proceedings for grant”, understood literally: other acts may also be excluded by a stay if they are inconsistent with the objective of protecting the third party’s rights. Rule 14 EPC 1973 can prevent, as lex specialis, other acts, e.g., as in J 20/05, the filing of a divisional application (see also G 1/09 [3.2.5], and J 9/12 [3,5]). In J 20/05 the filing of a divisional application was held to be excluded because of the need to protect the third party’s rights in the parent application. The Board said:

“... the appellant’s argument that it is not forbidden by R 13(1) to file a divisional application during suspension of the parent application proceedings cannot succeed. 

Even if the filing of a divisional application during suspension of the parent application proceedings is not expressly excluded by R 13 EPC [1973], R 13 is stated in general terms and it is consistent with its objective of protecting the third party claimant’s rights that the filing of a divisional application during suspension should be prevented. 

It would be inconsistent with and contrary to the fundamental objective of the provisions on suspension, on the one hand to suspend the parent application proceedings because of the national entitlement proceedings, but on the other to allow the filing of a divisional application by the applicant whose entitlement is challenged.”

See point [3] of the reasons, and also J 9/12 [5].

Registration of transfer during a stay: the Board’s conclusions

[6.1] The question is thus whether the registration of a transfer of an application is inconsistent with the fundamental objective of the suspension of the proceedings, which is to protect the third party claimant’s rights in the application.

[6.2] The core provision of the EPC so far as entitlement proceedings are concerned is A 61(1), which provides various remedies if “by a final decision it is adjudged that a person other than the applicant is entitled to the grant of the European patent”. In this respect it seems to the Board that if the EPO is to be required to act on such a decision, it needs to be a decision which establishes that the third party rather than “the applicant” is entitled to the grant. The Board considers that “the applicant” here can only mean the person entered on the register as applicant. The Board considers that a decision establishing that the third party rather than the former applicant, or indeed some other person, was entitled to the grant would not be sufficient for this purpose. It seems to the Board that if Allergan was correctly registered as the applicant, it was indeed necessary for Ferring to bring proceedings against Allergan, with all the increased costs which that involved. There would then also be nothing to prevent the application being subsequently transferred and registered in the name of another applicant. It follows that if the registered applicant can be freely changed while proceedings for grant are stayed, the third party’s attempts to obtain the remedies available under A 61(1) could be repeatedly frustrated.

[6.3] The LD originally took the view that following the registration of Allergan as applicant it was necessary for Ferring to bring proceedings against Allergan […]. In its decision, however, the LD changed its view: “… it is not necessary to institute separate entitlement proceedings before a competent court against the now registered applicant after a transfer of the application has taken place from the then registered applicant to the actual registered applicant.” […]. However, the Division does not appear to have taken into account in this context the significance of the reference to the “applicant” in A 61(1). The statement was also in fact made by way of introduction to the point that the entitlement proceedings had been brought against the person who was at the time registered as applicant (Reprise) and this was sufficient to entitle Ferring to a stay of the grant proceedings. As to this point, the LD was clearly correct.

[6.4] Allergan argued that the Board’s reading of A 61(1) is not correct: a final decision which establishes that Ferring is entitled to the grant will necessarily mean that no one else is entitled. It would in effect be a decision in rem. The Board disagrees with this argument. It would mean that a decision against a straw-defendant would oblige the EPO to implement the machinery of A 61. It is not even necessary to go to such an extreme example; it is not difficult to imagine non-collusive national proceedings in which a judgement on entitlement was obtained against some person other than the applicant.

[6.5] Allergan did not in fact argue in the alternative that a final decision obtained against a person who once was the applicant would, so far as the EPO is concerned in the application of A 61(1), be binding against a transferee from this applicant and who had since been registered as applicant. The Board considers that Allergan was correct not to do so. The effect of a final decision on any successors in title to the applicant would be a matter of national law. Rather, Allergan argued that if a transfer of the application was registered during the national entitlement proceedings, or even after a final decision was obtained, the third party could simply institute fresh entitlement proceedings and obtain a decision against that new applicant. It seems to the Board that this is the opposite of protecting the interests of the third party, given the expense and delay involved, and taking into account the fact that such proceedings would have to be brought in whatever was the appropriate jurisdiction according the Protocol on Recognition. A similar point arose in J 20/05, where it was argued, in the context of a divisional application being filed during suspension of the parent grant proceedings, that a third party could simply bring entitlement proceedings in respect of such divisional application, and apply to stay grant proceedings on that divisional application. The Board said:

“It has to be noted that it is not possible for the claimant third party to apply to the EPO for an automatic and immediate suspension of the divisional application proceedings by way of an extension of the suspension of the parent application proceedings. On the contrary, in order to have the divisional application proceedings suspended the third party would first have to bring (“open”) new national proceedings against the applicant in which it sought a judgment that it is entitled to the grant of a patent on the divisional application. The third party would then have to provide evidence that it had brought such proceedings and finally the matter would have to be decided by the EPO. All this would clearly put an additional heavy and undue burden on the third party and would be contrary to the objective of the suspension of the parent application proceedings, which is to protect its interests.”

See also J 9/12 [7].

[6.6] Allergan argued that it was important in the public interest that the register should reflect the true position so that, for example, if someone wished to acquire a licence in this case they would know that they should apply to Allergan and not Reprise. The Legal division also considered this informational role of the register to be an important factor. However, quite apart from the fact that anyone wishing to obtain a licence would presumably be re-directed by Reprise to Allergan, there is nothing to stop the filing, during the suspension of grant proceedings, of a request to transfer the application. The effect of a stay in the light of the Board’s decision will simply be that no action will be taken on the request during the suspension. While the fact of the transfer may not be apparent from the register, it will be apparent from an inspection of the public file, as will the decision to stay the grant proceedings itself. The public will therefore be sufficiently informed.

[6.7] The Board can accept that when it comes to implementing the mechanism of R 14 and R 15 it seems appropriate to consider the interests of the person who prima facie has the real interest in the application (here Allergan) rather than the interests of someone who prima facie no longer has any real interest in the application (here Reprise). However, for the reasons given below (point [8.4]), the Board considers that on such a request it would be appropriate to consider all the relevant circumstances, including the fact that the application had been transferred to a party with commercial interests in pursuing the remedies under A 61(1).

[6.8] Hence, the Board concludes, on the one hand, that the registration of Allergan as applicant while the grant proceedings were stayed failed to protect Ferring’s legitimate interests under A 61(1) as a third party and, on the other, that there are no sufficient practical or procedural objections against the suspension of any action to be taken on the request to register the transfer while proceedings are suspended.

Registration of transfer: referral of a question to the Enlarged Board of Appeal (EBA)

[7.1] In the light of the Board’s conclusion that the registration of Allergan as applicant should be reversed, Allergan requested that a question be referred to the EBA as follows:

“Can a transfer of a patent application be registered during a suspension of proceedings under R 14?”

[7.2] Allergan argued that a point of law of fundamental importance within the meaning of A 112(1) arises. Whether or not this is the case, the Board sees no need to refer the question. The Board has been able to come to a conclusion applying what it considers to be the established principles. It is also not in any doubt about the result and is not aware of any legal view-points expressed either in national case law or in legal commentaries which might cast doubt on the conclusion reached (see J 5/81 [11]).

The procedural consequence of reversal of registration

[8.1] The consequence of the Board’s decision that the registration of Allergan as applicant must be reversed now has to be considered. The LD, having decided that Allergan had been correctly registered as applicant, went on to deal with the competing requests arising out of the suspension of the grant proceedings, in the end reaching a decision not to make any order in this respect. This second part of the decision was also the subject of both appeals. In its communication sent to the parties on 15 July 2013 in preparation for the oral proceedings (OPs), the Board pointed out that if the decision on registration was wrong it would mean that the wrong parties had been before the LD and now the Board in these appeal proceedings.

[8.2] Neither party filed any response to this observation. However, during the OPs before the Board, and after the Board had announced its conclusion that the registration of Allergan as applicant had to be reversed, Allergan for the first time advanced a submission that the appeal proceedings could then and there be continued because even though Allergan was now known not to be the applicant, it was entitled under R 14(3) as an interested party to request continuation of the grant proceedings. As to the absence of Reprise from the proceedings, Allergan’s representatives said that they also represented Reprise, so that there was no obstacle to the appeal being continued on this basis.

[8.3] As to this point, the Board makes the following observations:

(a) The essential purpose of appeal proceedings is to decide whether the decision under appeal was correct. In the present case the essential issues decided by the LD and the issues which then became the subject matter in the appeal proceedings were whether the registration of Allergan as applicant should be reversed, and whether the grant proceedings should be resumed on the request of the applicant and, if so, when. Whether grant proceedings should be resumed on the application of another party, being the transferee of the application, was never an issue in the first instance proceedings. Nor until the afternoon of the OPs before the Board was it raised in the appeal proceedings.

(b) In reality, Allergan’s argument amounted to a request for the Board to exercise its discretion to allow Allergan to amend its case at a very late stage of the appeal proceedings by reconstituting the entire proceedings and continuing with the appeal on that basis (see Articles 13(1) and (3) RPBA).

(c) This request was a response to a state of affairs that had been a clear possibility for over three years, namely from 3 August 2011, the date when Ferring first filed its request to reverse the registration of Allergan as applicant […]. However, Allergan at no time took any steps to guard against this possibility by filing auxiliary requests on behalf of Reprise in the proceedings before the LD or in the appeal proceedings. That it is open to a party to guard against such procedural uncertainties is demonstrated by G 2/04:

“... it is an accepted principle in proceedings before the EPO that a party may file auxiliary requests. When used appropriately, such requests do not impede the course of proceedings. Rather, they make clear at an early stage what the fallback positions of a party are and give the adversary and the deciding body the opportunity to be prepared as soon as the respective request becomes relevant. This is the case when the preceding preferred request turns out not to be allowed by the deciding body.” (Point [3.2] of the Reasons)
“If, when filing an appeal, there is a justifiable legal uncertainty as to how the law is to be interpreted in respect of the question of who the correct party to the proceedings is, it is legitimate that the appeal is filed in the name of the person whom the person acting considers, according to his interpretation, to be the correct party, and at the same time, as an auxiliary request, in the name of a different person who might, according to another possible interpretation, also be considered the correct party to the proceedings.” (Point II of the Order)

(d) The Board would not wish to allow purely formal procedural requirements to get in the way of dealing with the substantive issues. However, the correct constitution of proceedings is not a matter of pure formality. It is important that the correct persons are parties to the proceedings so that they are bound by the decision as a matter of res judicata and can, for example, if appropriate, be made the subject of an order to pay costs. Even though Allergan’s representatives stated that they had power of attorney to act also on behalf of Reprise, no formal application in the name of Reprise to join the proceedings was made. In T 1178/04 [46] the decision was reached that the wrong parties were present in the appeal proceedings (a transfer of the opposition status was held by the Board to have been invalid), with the result that the Board felt compelled to remit the case. In T 1982/09, the factual situation was similar in that the Board decided that the opponent status had not been validly transferred but the Board nevertheless felt able to continue the appeal proceedings. But there the representative had reacted appropriately at an earlier stage of the appeal proceedings to this possibility and both parties wanted the Board to go on and decide the substantive issues. The correct opponent was “deemed to have acquired the appellant status” from the wrong opponent as a consequence of the Board having decided that the opponent status was not validly transferred (point 2.2 of the reasons). That is not the position here.

(e) All these considerations point away from allowing Allergan’s request.

[8.4] The Board is in any event not convinced by the central plank of the Allergan’s argument based on the construction of R 14(3). This states:

“Upon staying the proceedings for grant, or thereafter, the EPO may set a date on which it intends to resume the proceedings for grant, regardless of the stage reached in the national proceedings instituted under paragraph 1. It shall communicate this date to the third party, the applicant and any other party. …”

Allergan argues that since this rule refers to “the third party, the applicant and any other party” (“Beteiligte” in the German version of the rule), it must mean that any person may apply for a resumption of the grant proceedings. As to this, the opening wording of the rule (“Upon staying the proceedings for grant, or thereafter, the EPO may set a date on which it intends to resume the proceedings for grant …”) is in fact perfectly general, and indeed appears to contemplate that the EPO may act on its motion (as happened in T 146/82. The Board is not sure who is intended by the reference to “any other party” (see also the reference to “the applicant and any other party” in R 14(2)). In this the Board was not helped by the fact that Allergan’s submission came out of the blue. But it is not necessary to reach any conclusion because it does not follow from this statement about the parties who must be informed about the date of resumption of the grant proceedings that any person has the right to apply for such resumption, and certainly not in the absence of the applicant as party. It also does not mean, as Allergan argued, that the interests of a party such as Allergan (a contractual transferee of the application) will never be taken into account when considering whether to resume grant proceedings: the Board sees no reason why it should not be relevant for the EPO to take such interests into account if it becomes appropriate to weigh up the various interests. (In this respect it should be noted that Ferring reserved the right to argue that it is never appropriate to weigh up the competing interests).

[8.5] For all of these reasons, therefore, and even on the assumption that Allergan’s amendment to its case were to be admitted […], the Board refused to continue the appeal proceedings with the hearing of Allergan’s request, as a “third party”, for immediate resumption of the grant proceedings.

Referral of further questions to the EBA

[9.1] In reaction to the Board’s indication that it did not intend to continue with the appeal proceedings by hearing Allergan’s request to resume the grant proceedings, Allergan filed a request to refer two further questions to the EBA, as follows:

“Can a party other than the applicant (Beteiligter) make a R 14(3) request? 

If the answer to question 2 is no, then if a patent application is transferred during stay of proceedings for grant how are the interests of a good faith recipient of the patent application to be heard by the EPO?”

[9.2] It was said that answers to these questions were needed because a point of law of fundamental importance arose. As to the first question, the issue has arisen not only in the context of the exercise by the Board of its discretion as to the handling of the appeal proceedings but also in the particular and unusual circumstances of the case. As already pointed out, these have arisen partly because the precautionary step of filing auxiliary requests in the name of Reprise was never taken. The Board does not need the answer to such a question in order to deal with this procedural situation. The same answer can be given in relation to the second question which Allergan asks to be referred, which essentially is a rhetorical question in support of its argument on the first question. As stated above (point [8.4], at the end), the refusal to register a transferee as applicant while the proceedings are stayed does not mean that the economic interests of the transferee cannot be taken into account. It is also no undue burden for the transferor to make the transferee’s interests heard while the grant proceedings are stayed. The Board would also point out that (a) it is not the purpose of a reference under A 112(1) for the EBA to give answers to open procedural questions framed in this way and (b) the question is in any event hypothetical since the status of Allergan as “a good faith recipient of the patent application” (whatever this may mean) is not established and is clearly a matter of dispute so far as Ferring is concerned.

Order […]

 The registration of Allergan as applicant is ordered to be reversed. […]

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J 13/12 – It’s Time To Get Ahead

This decision deals with an appeal against the decision of the Legal Division (LD) to resume proceedings that had been stayed.

The patent application was about to be granted (communication pursuant to R 71(3) issued on February 20, 2009) when the LD stayed the proceedings as of April 16, 2009, because the Doosan Lentjes company had started entitlement proceedings against the applicant, the Hamon Enviroserv company before the Düsseldorf district court.

On June 21, 2011, this court dismissed the complaint. The plaintiff filed an appeal before the Düsseldorf appellate court.

The LD then announced that the proceedings would be resumed in view of the length of the proceedings and the fact that the application was about to be granted.

The Doosan Lentjes company filed an appeal against this decision.

The Board found the appeal to be admissible and then examined its allowability:

*** Translation of the German original ***

[3] The appellant essentially bases its appeal on the fact that in its decision on the resumption of the stayed proceedings the LD had not sufficiently considered and weighed all the relevant objective circumstances and the interests of the parties but had only followed the judgment of the Düsseldorf district court, which had dismissed the complaint.

Based on this the appeal would be allowable if the LD had wrongly exercised its discretion, and, therefore, committed a legal error, by fixing July 1, 2012, as the date on which the grant proceedings – which had been stayed since  April 16, 2009 – were to be resumed pursuant to R 14(3) […] or if the factual circumstances have changed with respect to those on which the impugned decision was based such that they now allowed for and required a different assessment of the question of whether the grant proceedings were to be resumed or further stayed pursuant to R 14(1) […].

Has the decision been based on a wrongful exercise of discretion?

[3.1.1] First of all it should be noted that the extent to which the Boards of appeal can review discretional decisions of the administrative instance is limited. Insofar as the appellant contests the way in which the LD has exercised its discretion when taking the impugned decision, the case law of the Boards of appeal, which has in principle been confirmed by the Enlarged Board of appeal (G 7/93), has established that it is not the function of a Board of appeal to review afresh the factual situation of the case as if it were in the place of the organ of the administrative instance which has taken the impugned decision, in order to decide whether or not it would have exercised such discretion in the same way. If an administrative organ is required under the EPC to exercise its discretion in certain circumstances it should have a certain degree of freedom when exercising that discretion, without interference from the Board of appeal. A Board of appeal should only overrule the way in which the administrative instance has exercised its discretion if it comes to the conclusion either that the latter has not exercised its discretion in accordance with the right principles or in an unreasonable way, and has thus exceeded the proper limits of its discretion.

[3.1.2] As can be seen from the impugned decision, the LD has taken account of both the provisions that are relevant for its decision – in particular A 61 and R 14 – and the relevant case law, in particular G 3/92 and J 33/03; it has realized that it has a discretional power and has weighed the interests of the parties.

Thus it is clear that [the LD] did not wrongly exercise its discretion by not making use of its discretional powers.

[3.1.3] As to an exercise of discretion in accordance with wrong principles, it is necessary to first define the legal framework:

[3.1.4] A 61(1) in connection with R 16 governs the procedural rights of a person other than the applicant (a so-called third party) to whom a final decision of a national court has allocated the right to the grant of a European patent in place of the applicant; it offers this person the possibility of carrying out certain required actions related to the application.

Insofar as the European patent has not yet been granted (R 16(1)(b)) this third party may, no later than three months after the decision recognising its entitlement has become final (R 16(1)(a)), in respect of Contacting States designated in the EP application in which the decision has been taken or recognised or must be recognised on the basis of the Protocol on Recognition:

(a) prosecute the EP application as its own application in place of the applicant (A 61(1)(a));

(b) file a new EP application in respect of the same invention (A 61(1)(b)); or

(c) request that the EP application be refused (A 61(1)(c)).

[3.1.5] R 14 provides for a stay of the proceedings during the period in which the third party seeks a judicial decision confirming that it is entitled to the grant of the European patent; its purpose is to safeguard the rights of the third party for the duration of the proceedings by which the third party asserts its claims. R 15, which provides that from the date on which a third party provides evidence that it has instituted national proceedings by which the third party asserts its claims and up to the date on which the proceedings for grant are resumed, neither the European patent application nor the designation of any Contracting State may be withdrawn, has the same purpose.

[3.1.6] Pursuant to R 14(1), first sentence, if a third party provides evidence that it has instituted proceedings against the applicant seeking a decision within the meaning of A 61(1) the proceedings for grant shall be stayed unless the third party communicates to the EPO in writing its consent to the continuation of such proceedings.

[3.1.7] In the present case the grant proceedings were stayed by a communication of the LD dated April 22, 2009, with retroactive effect as of April 16, 2009, as a consequence of the indication of the appellant dated March 24, 2009, and its further written submission dated April 16, 2009.

[3.1.8] The fact that the LD did not determine a date on which the examination proceedings were to be resumed when it decided to stay the proceedings does not as such allow to draw conclusions as to the further proceedings. This is because pursuant to R 14(3) the grant proceedings may be resumed even if the EPO had not fixed a date for the proceedings to be resumed in its decision to stay, and before a final decision has been issued in the national entitlement proceedings.

[3.1.9] R 14 has to be considered in the context of the EPC as a whole and in particular in connection with A 61, which it further implements, and R 15. As the Board had already explained in its decisions J 7/96 [2.2] and J 8/96 [2.2], these provisions form part of a system of legal process which is provided under the EPC for determining the right to a European patent application when this is in dispute, and for implementing this determination. It is clear from the travaux préparatoires of the EPC that it was considered important to provide such a system in which disputes as to entitlement could be settled by a final decision of a national court but then implemented centrally by the EPO with respect to all the designated States (see document IV/2498/1/61-D, page 17 et seq). The terms of these provisions must be interpreted in this context and in the light of the object and purpose of this system (cf. G 3/92 [1]).

[3.1.10] As the Board has decided in its decision J 33/03 [2.1], contrary to the decision to stay the proceedings according to Rule 14(1), it is in the discretion of the Office to decide whether the proceedings are to be continued under R 14(3). When exercising discretion within the framework of R 14(3) the EPO, i.e. the LD and, pursuant to A 111(1), second sentence, also the Board acting within the framework of the competence of the LD, has to weigh the interests of the applicant on the one hand and the third party who has instituted national entitlement proceedings against the applicant on the other hand. In this context the EPO has to consider in particular the purpose of A 61, which is directed at a “well-balanced and fair resolution of conflicting interests” (G 3/92 [8.4]). The Guidelines for Examination, which are internal Guidelines issued by the administration, may be used as a complement.

[3.1.11] According to the Guidelines developed for the application of R 14(3) in concrete cases, the Guidelines for Examination A IV-2.3:

“If a date is set for the resumption of the proceedings for grant, it should be chosen with due consideration for the interests of the third party who only becomes a party to the proceedings after a judgement has been given in his favour, on the basis of the probable duration of the court proceedings so as to enable them to be concluded within that period of time. If, by the date set, the court has not given a judgement, the proceedings for grant must at all events be further stayed if the judgement is expected in the near future. However, the proceedings for grant should be resumed if it is evident that delaying tactics are being employed by the third party or if the proceedings in the court of first instance have concluded with a judgement in favour of the applicant and the legal procedure is extended by the filing of an appeal.”

[3.1.12] These internal administrative provisions do not support the appellant’s allegations concerning the conditions for resuming the grant proceedings and in particular do not support the legal consequences it seeks to obtain. Rather, the LD has appreciated all relevant circumstances of the case in a way that does not allow to conclude that it has wrongly exercised its discretion.

[3.1.13] In particular, it is not wrong, but it rather follows from the internal administrative provisions of the EPO (Guidelines for Examination) that the LD has not issued a separate communication setting a date for the grant proceedings to be resumed before the order to resume the grant proceedings. The LD was entitled to do so for the first time in the impugned decision.

[3.1.14] Nor can it be derived from the Guidelines for Examination that the LD has to wait for a final decision in the entitlement proceedings, possibly after all possible remedies have been exhausted (first instance, appeal, and review proceedings) or at least for the end of the appeal proceedings, before it can fix a date for the resumption of the grant proceedings, and in any case before the proceedings are actually resumed.

[3.1.15] It is part of the circumstances that the LD has to take into account (and which it has indeed taken into account) that a third party may indeed only exercise its procedural rights pursuant to A 61(1) if there has been a decision to its favour in national proceedings according to which the applicant was not entitled to a patent application, but this does not necessarily mean that the grant proceedings relating to the patent application of the person that was not entitled has to be stayed or remain stayed until that date. Rather, the rights of the third party are not only protected by possibility for it to prosecute said European patent application as its own application in place of the applicant who lacked entitlement (A 61(1)(a)) but also by the possibility to file a new European patent application in respect of the same invention (A 61(1)(b)). The admission of this new application is not limited to the case where the former, irregular application is still pending before the EPO (cf. G 3/92 [headnote]) in case the application has been withdrawn or is deemed to have been withdrawn.

Moreover, even after the Examining Division has decided to grant a patent application filed by an applicant who was not entitled, the entitled third party can exercise its right pursuant to A 61(1)(a) until the formal end of the grant proceedings pursuant to A 97(3) and A 98 and prosecute the European patent application as its own application in place of the applicant who lacked entitlement (cf. J 7/96 [9], J 8/96 [9]).

Insofar as the pursuit of the grant proceedings curtails the procedural rights of the third party, it puts an end to the strong legal position of the third party. However, in the present case possible serious consequences for the appellant are due to the fact that it has instituted entitlement proceedings and filed the request for a stay of the proceedings only at a very late stage of the grant proceedings, i.e. after the communication pursuant to R 71(3) to the applicant, although it was aware of the [existence of the] application. As a matter of fact the third party that prosecutes the EP application as its own application pursuant to A 61(1)(a) takes on the application in the procedural stage in which it was at the time when the proceedings were stayed. This also applies to the impending loss of right to file divisional applications according to the presently applicable provisions for divisionals, which was mentioned in this context by the appellant. Thus the fact that this circumstance was not taken into account cannot constitute a wrongful exercise of discretion.

[3.1.16] Nor can such a wrongful exercise of discretion be constituted by the consideration of the LD that the entitlement proceedings were unsuccessful for the appellant, at least at first instance.

The Guidelines for Examination precisely refer to the case where the judgement is in favour of the applicant – and to the detriment of the third party – who then files an appeal as an example for a situation where the stayed proceedings are continued.

[3.1.17] Insofar as the appellant asserts that the decision of the Düsseldorf district court to dismiss its complaint was mistaken and that it was likely to succeed in the appeal which it had filed, these submissions cannot be taken into account in the grant proceedings in general and in particular in the present appeal proceedings (cf. J 33/03 [2.2]; Benkard-Melullis, EPÜ, 2^nd edition, 2012, A 61, marginal number 21).

Only the national courts have jurisdiction to decide claims, against the applicant, to the right to the grant of a European patent (Article 1(1) of the Protocol on Jurisdiction and the Recognition of Decisions in respect of the Right to the Grant of a European Patent (Protocol on Recognition)). Moreover, neither the LD nor the Board can decide to which party the European patent application might belong or which outcome of the national entitlement proceedings is more likely.

Thus the only aspect that can be taken into account when weighing the interests (and which was indeed taken into account by the LD) is that the entitlement proceedings instituted by the appellant against the respondent has not led to a final decision yet but is still pending as an appeal, which – in view of the previous procedural behaviour of the parties – might be followed by review proceedings before the Federal Supreme Court (Bundesgerichtshof). At least a reasoned judgement of a competent German court that has been issued after inter partes proceedings (im streitigen Verfahren) militates against the claims (Klagebegehren) of the appellant. It is not foreseeable that the appellant will finally succeed in the entitlement proceedings, nor is it foreseeable when there will be a final decision on the entitlement proceedings (before the appellant court or possibly even in review proceedings). Thus a prolongation of the stay of the grant proceedings according to the main request (as well as the first auxiliary request) of the appellant would lead to an indefinite delay of the grant proceedings and thus to a disproportionate disadvantage for the appellant.

[3.1.18] Finally the LD was entitled to – and even had to – take into account that the grant proceedings had been stayed for more than three and a half years (cf. J 10/02 [4.1] where the importance of the duration of the stay was underlined). This fact alone affects the interests of the respondent in a speedy treatment of its application in a significant way; a further stay of the grant proceedings would correspond to a disproportionate burden for the respondent that cannot be justified by the interests of the appellant.

[3.1.19] Insofar as the appellant has asserted that the fact that the examination proceedings were quite advanced, as can be seen from the fact that there had already been a communication pursuant to R 71(3), and that, as a consequence, a grant of the patent could be expected very soon, would hinder it from asserting its rights, this aspect has also been explicitly considered by the LD (point 8 of the impugned decision).

[3.1.20] Thus the Board of appeal is unable to find any error committed by the LD in the exercise of its discretion when it issued the impugned decision.

[3.2] As to new circumstances which could now justify a different assessment of the question of whether the proceedings were to be stayed by the Board of appeal, the appellant essentially refers to a change of the provisions governing divisional applications as well as to the fact that once the patent was granted, it could only assert its claim to entitlement under more difficult circumstances in each state designated by the patent.

[3.2.1] However, the Board of appeal cannot see – although it has asked [the appellant] in its summons to oral proceedings – how the legal position of the appellant could have changed to its detriment since the impugned decision has been issued; as a matter of fact only if and to the extent that this was the case the Board of appeal could take a decision that was not limited to the review of discretional decisions. Rather these circumstances are circumstances that already existed at the time of the impugned decision which, therefore, were already addressed by the discretional decision, which, as mentioned above, was free from error.

[3.2.2] Nor can the Board of appeal discern any new circumstances which have arisen after the impugned decision was issued and which would justify or require a prolongation of the stay of the grant proceedings pursuant to R 14.

Both parties have confirmed that the appeal proceedings before the Düsseldorf appellate court were pending and that one could not expect a judgement, let alone a final decision, in the entitlement proceedings in the near future. The investigations of the Public Prosecutor (staatsanwaltschaftliche Ermittlungen) as such do not provide sufficient indications that would allow to draw the conclusion that the position of the respondent was unlawful, all the more as the EPO and the Boards of appeal have no jurisdiction for assessing the chances of success of the national lawsuit and the investigations of the Public Prosecutor.

Finally, the Board of appeal has no jurisdiction for assessing the pieces of circumstantial evidence cited by the appellant, which it believed were sufficient for establishing an unlawful behaviour of the respondent and its entitlement […]. Only the national authorities (court, public prosecutors) have jurisdiction in this regard.

[3.2.3] Moreover, the discretionary considerations mentioned by the LD and taken into account by it still apply; the Board of appeal, considering all relevant circumstances and the interests of the parties both from a factual and a legal point of view, comes to the conclusion that the stay of the grant proceedings should not be prolonged and that the proceedings should be resumed. […]

The appeal is dismissed. […]

The grant proceedings are to be resumed as soon as this decision is announced (June 17, 2013).

It is interesting to see how important the Guidelines become in this context, isn’t it?

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J 9/12 – When We Stay You Freeze

This is an appeal against the decision of the Receiving Section (RS) refusing to treat an application as a divisional application.

On May 26, 2010, a third party had requested a stay of proceedings concerning the parent application, a few days after the Examining Division had issued a decision to grant.

On June 8, 2010, the applicant filed a divisional application.

The mention of the grant of the parent application was published in the Bulletin.

On June 10, 2010, the Legal Division informed the parties that the proceedings for grant had been stayed as from May 26, 2010, and that the mention of grant would be corrected in due course.

On November 30, 2010, the RS informed the applicant that the application in suit could not be treated as a divisional, due to the stay of proceedings.

The applicant contested these findings and requested a decision. It then filed a decision against this decision.

The arguments of the applicant can be summarised as follows:

(a) The filing of a divisional application was not a procedural act in the proceedings for grant concerning the parent application. There was thus no basis in the EPC for refusing to process the application in suit as a divisional application on the grounds that the grant proceedings relating to the parent application had been stayed.

(b) Notwithstanding decision J 20/05, the purpose of a stay of the grant proceedings - namely to protect the rights of a person who claimed an entitlement - did not justify the legal consequence of refusing to process the application in suit as a divisional application after staying the proceedings in respect of the parent application. The rights of a third party claiming entitlement to the invention could also be preserved by just extending ex officio the stay of the proceedings with regard to the parent application to the newly filed divisional application. Decision J 20/05 should thus be reconsidered.

(c) The decision to grant a patent for the parent application had indicated that the mention of grant would be published on 9 .... The last opportunity to file a divisional application was thus 8 .... At that time, the public was not aware of the stay of the proceedings for grant concerning the parent application. A correction of the decision to grant was published in the European Patent Bulletin only later. The requirements of A 76 and R 36 had been fulfilled on the date of receipt of the divisional application and the subsequent stay of the proceedings for grant concerning the parent application had no impact on the validity of the divisional application.

The Board dismissed the appeal:

Legal basis

[2] The RS held that an applicant may not validly perform any procedural acts while the proceedings are stayed pursuant to R 14(1), and that this included the filing of a divisional application under R 36. The [applicant] objected to this finding, and argued that there was no legal basis for extending the effects of a stay of the grant proceedings concerning the parent application to the filing of a divisional application.

[3] It is established jurisprudence with regard to A 76 and R 25 EPC 1973 that it is the entitlement acquired by virtue of the parent application that gives the right to file a divisional application. This means that the rights derivable for the divisional application from the earlier application correspond to, but are also limited to, the rights existing in respect of the parent application at the filing date of the divisional application. The entitlement to file a divisional application according to A 76 and R 25 EPC 1973 is thus a procedural right that derives from the applicant’s status as applicant under the earlier application (J 2/01 [5.1, 6]; J 20/05 [2]). Therefore, as well as examining the other formal requirements for the filing of a divisional application, the RS has also to examine whether the applicant is entitled to file the divisional application by virtue of being the applicant in the earlier application (J 20/05 [2]). As a consequence, R 13 EPC 1973 was found to prevent, as lex specialis, the filing of a divisional application if the proceedings for grant concerning the pending earlier application had been stayed (J 20/05 [headnote, 3]; see also G 1/09 [3.2.5], confirming this finding).

[4] The principles set out in this jurisprudence are still pertinent under the revised law. R 13(1) EPC 1973 was streamlined and its wording aligned with the revised EPC. It was not changed in substance. R 36(1) as adopted by decision of the Administrative Council of the European Patent Organisation of 7 December 2006 (Special edition No. 1, OJ EPO 2007, 89) and the amended versions which entered into force on 1 April and 26 October 2010 (see decisions of the Administrative Council of 25 March 2009, OJ EPO 2009, 296, and of 26 October 2010, OJ EPO 2010, 568) continue to be based on the principle that a divisional application may be filed “relating to any pending earlier European patent application”. Therefore, the right to file a divisional application still follows from the entitlement acquired by virtue of the parent application.

[5] The board sees no reason to depart from the finding of decision J 20/05 [headnote, 3], confirmed by decision G 1/09 [3.2.5], that R 14 prevents the filing of a divisional application if the proceedings for grant concerning the earlier application are stayed. Even if the filing of a divisional application during stay of the proceedings for grant regarding an earlier application is not expressly excluded by the EPC, it is consistent with the purpose of R 14 and R 36. Since the rights in respect of a divisional application can be derived only from the earlier patent application, such patent application cannot form a sufficient basis for a right to file a divisional application if the right of the applicant to the grant of a European patent in respect of the earlier application is disputed and the proceedings for grant stayed under R 14(1). Furthermore, to allow the filing of a divisional application by an applicant whose entitlement is challenged would be inconsistent with and contrary to the fundamental objective of R 14(1), which is to preserve any potential rights a third party may have to the grant of a patent for the earlier application in dispute.

No automatic extension of the stay to any divisional application

[6] The [applicant] argued that the rights of a third party claiming entitlement to the invention for which protection is sought in an earlier application could also be preserved by extending ex officio the stay of the proceedings in regard to the earlier application to any subsequently filed divisional application. Decision J 20/05 should be reconsidered in this respect.

[7] The board cannot agree. Up to the grant of a European patent, the applicant alone has the status of party to proceedings before the EPO. A person other than the applicant is not a party to the proceedings for grant (A 115, second sentence, despite the use of the term “third party”). He may acquire party status in these proceedings in limited instances only, where the EPC provides for a right of a person other than the applicant to submit requests in respect of a patent application. R 14, which is based on A 61, is one such example. As decision J 20/05 [6] pointed out, it is not possible for a person seeking a decision within the meaning of A 61 to apply to the EPO under R 14(1) for an automatic and immediate suspension of proceedings regarding any divisional application deriving from an earlier application by way of an extension of the stay of the proceedings regarding the earlier application. The EPO is entitled to stay the proceedings for grant under R 14(1) only if there is clear and unambiguous proof that the claimant’s request in the proceedings before the national court is for judgment that he is entitled to the grant of the European patent application which is to be suspended, and not for any other application, however related it may be. Moreover, only proceedings for grant may be stayed which concern European patent applications pending at the date of filing of the request for stay. Furthermore, proceedings for grant cannot be stayed before the publication of the European patent application.

Therefore, R 14(1) cannot be regarded as conferring on the departments of the EPO the power to extend ex officio a stay of the grant proceedings concerning an earlier application to any divisional application proceedings filed thereafter. The EPC thus leaves no room for the alternative interpretation put forward by the [applicant]. In conclusion, the board agrees with the findings of decision J 20/05 that, in order to preserve the rights of a third party claiming entitlement to the invention for which protection is sought in an earlier application, and to prevent the applicant from prejudicing the third party’s possible rights, a European patent application which is filed under R 36 while the proceedings for grant of the earlier patent application are stayed may not be processed as a divisional application.

Immediate effect of the stay of proceedings for grant

[8] There remains the [applicant’s] argument that the requirements of A 76 and R 36 had been fulfilled on 8 June 2010, the date of receipt by the EPO of European patent application […] in suit, and that the subsequent communication ordering the stay of the proceedings concerning the parent application had no impact on the validity of the divisional application. The [applicant] thereby contests the lawfulness of a stay of the proceedings for grant under R 14(1) which is communicated after the date of publication of the mention of grant of the patent for an earlier application and affects a divisional application filed in the interval between the filing of a request for a stay of proceedings and the communication of the stay to the parties involved.

[9] The board notes that the [applicant] has neither objected to the communication from the Legal Division of 10 June 2010 nor requested an appealable decision. The board has thus no power to review the order for the stay of the proceedings for grant concerning the parent application. The further issue addressed by the [applicant] requires an answer in this decision only in as far as it raises the question of whether a stay of proceedings for grant communicated after the publication of the mention to grant is to be regarded as automatically null and void.

[10] The contested decision of the RS relied on decisions J 28/94 [3.1], J 7/96 [headnote, 2.1, 3, 8, 11]) and J 10/02 [3.1] to justify the stay of the proceedings for grant concerning the parent application as from the receipt of the allowable request for a stay on 26 May 2010. However, these decisions do not explicitly deal with the situation where a divisional application is filed before the date of publication of the mention of grant and a stay in regard to the parent application is communicated thereafter.

[11] The jurisprudence of the Legal Board of Appeal is nevertheless consistent in that a request for stay of the proceedings under R 14(1) may be filed up to the day before the date of the mention of grant of the European patent in the European Patent Bulletin (with regard to R 13(1) EPC 1973 see J 7/96 [headnote, 2.1, 3]; J 36/97 [3]). A stay of proceedings under R 14(1) takes immediate effect as from the date on which an allowable request is filed, i.e. as from the date the EPO is provided with satisfactory evidence that national proceedings have been instituted against the applicant seeking a decision within the meaning of A 61(1) (with regard to R 13(1) EPC 1973 see J 28/94 [2.1, 3.1]; J 7/96 [2.1]; [2]; J 10/02 [3.1]). Furthermore, the EPO is responsible for the grant proceedings up to the date of the publication of the mention of grant of the patent. This competence includes the publication of any necessary correction of a publication of the mention of grant (J 15/06 [11]). As a consequence, the publication of the mention of grant does not take away the competence of the Legal Division to issue a communication and, if requested, a decision ordering a stay of the grant proceedings, provided that an allowable request is filed before publication (see J 15/06 [14] with reference to decisions J 33/95 and J 36/97). It would moreover be contrary to the purpose of R 14(1) if procedural acts taken in the interim period between the filing of a request for stay and the decision of the Legal Division on this request were to produce legal effect irrespective of the final decision on the stay of the proceedings (see J 7/96 [8]). For the above reasons, the board cannot accept the argument that a stay of proceedings for grant communicated after the publication of the mention of grant is to be regarded as automatically null and void.

[12] In the present case, an allowable request for a stay of the grant proceedings concerning the parent application was received on 26 May 2010. As from that date, the grant proceedings had to be stayed without the EPO having to take a formal decision. The publication of the mention of grant of a patent for the parent application on 9 ... did not take away the competence of the Legal Division to separately issue a communication on the order of the stay as from 26 May 2010. The application in suit, i.e. European patent application No. […] was received by the EPO on 8 ..., i.e. after the effective date of the stay of the grant proceedings concerning the parent application. R 14(1) together with R 36(1) thus prevented the valid filing of the application in suit as a divisional application of the parent application. As a consequence, the appeal must fail.

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