Has “Raising the Bar” actually raised the bar on inventive step?
Published on 02 Mar, 2017
Nearly four years ago, on 15 April 2013, Australian patent law entered a brave new world. Gone were the days of so-called “soft” patentability criteria that were out of kilter with those of our major trading partners – the Raising the Bar Act was going to change all of that. One reputedly soft criterion was that of inventive step. The bar was to be raised by removing any geographical limitation upon the common general knowledge and by doing away with the requirement for a prior art document to have been “ascertained”. These changes would ensure a higher and more consistent inventive step standard for Australian patents granted under the new legislation. At least, that was the theory. In this article, we briefly consider what effect these changes have had in real terms and conclude – at least in respect of inventive step – that Raising the Bar may amount to more of an attitudinal shift.
On 15 April 2013, many of the provisions of Australia’s Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (“RTB”, the “new Act”) came into effect. Among other incentives, the changes were intended to raise the quality of granted patents by more closely aligning Australian patentability standards with those of our major trading partners. Inventive step was championed as one such standard – the inference being that the previous “old Act” criteria were too soft:
“In order to meet its objective of supporting innovation, the patent system must strike a balance. It must provide sufficient protection to reward innovation.. ..Concerns have been raised that the thresholds set for the grant of a patent in Australia are too low, suppressing competition and discouraging follow-on innovation. Particular concerns have been raised that patents are granted for inventions that are not sufficiently inventive..”.
As a starting point, this requires that the new Act amendments should redress any imbalance, be it real or perceived, present under the old Act. Accordingly, this article considers whether the amendments introduced post-RTB have had any discernible effect upon the assessment of inventive step under Australian patent practice. The discussion is largely theoretical; at the time of writing, comparatively few new Act cases have been contested at opposition or court level – and even fewer of these have stood or fallen on the basis of inventive step considerations. Accordingly, with a limited sample size at our disposal, the best we can do at this stage is to make an educated generalisation.
Decisions, deadlines and a deluge
The legislative intent of the RTB changes was disseminated widely throughout the profession, both locally and internationally, for a good 18 months prior to commencement of the new Act. The “bar would be raised”. Australian patents granted under the new laws would be harder to come by. However, in order to “duck under”, all one had to do in order to ensure that their Australian patent application was examined under and subject to the old law throughout its lifecycle was to file a request for its examination before the deadline of 15 April 2013. Any case for which examination had not been requested by this date then became subject to the new Act. Simple.
Standard practice throughout our local industry seems to have been that applicants were encouraged to request examination of any pending Australian patent applications prior to the deadline. There’s nothing too controversial in this statement – and with the over-arching obligation to Act within the best interests of our clients, the reasons for such encouragement are self-explanatory. Applicants were also encouraged to bring forward the filing of international phase applications, divisional applications, etc. – and to capture these as old Act cases by requesting examination prior to the deadline. Again, such advice is easily justified; the new laws purportedly made it more difficult to obtain an Australian patent – and it was therefore in an applicant’s best interests to have their case/s examined under and subject to the “old” (softer) laws.
In this respect, there seems to have been very little by way of counter-argument. Moreover, it seems as though Australian patent applicants took heed of the advice they were given; IP Australia was apparently deluged with nearly 22,000 examination requests in the month leading up to the deadline.
RTB was a whole lot more than just inventive step
It is worth noting at this point – perhaps even by way of disclaimer, that the new laws go considerably beyond inventive step; they also relate to utility/usefulness, sufficiency, descriptive support (formerly, “fair basis”), prior use, and the allowability of certain amendments; inventive step was but one of the many factors an applicant needed to consider when deciding whether or not to request early examination of an Australian patent application. Accordingly, any finding or suggestion that inventive step pre-RTB isn’t likely to be significantly different from inventive step post-RTB should not be taken to imply that the flurry of activity prior to 15 April was in any way unnecessary – far better safe than sorry in this regard.
What’s done is done – at least insofar as the decision to request, or not to request early examination goes. In effect, this was a one-time window of opportunity that closed nearly four years ago. Applicants who did so would have found their patent costs brought forward in a manner perhaps not budgeted for initially. However, the trade-off was that they effectively bought peace-of-mind.
But inventive step was a significant part of RTB
In respect of inventive step, the new law is characterised by two principal changes to the restrictions upon the information and background knowledge that may taken into account:
- The assessment of the common general knowledge (“CGK”) of an ordinary skilled worker in the art is no longer restricted to that which would be CGK in Australia – it is now to be assessed “internationally”.
- Previously, prior art used for the purposes of assessing inventive step must have been shown to have been “ascertained, understood and regarded as relevant” by a person skilled in the art. Under the new law, it is only necessary that the skilled person would understand and regard the prior art as relevant (both of which surely follow from the prior art being in the same, or a related field, to that of the claimed invention). The requirement that a document be ascertained (e., located) has been removed.
The above points paraphrase the post-RTB inventive step changes as prescribed by the legislation. In conjunction with the following points on inventive step practice during examination, one can begin to appreciate that they are, in fact, the only changes; the approach to assessing inventive step, the relevant tests and the standard of proof all remain the same post-RTB:
- Both pre- and post-RTB, an assessment of inventive step under Australian practice applies the Problem-Solution Approach. This has not changed. Indeed the respective “old” and “new” sections of the IP Australia Examiner’s Manual are verbatim.
- The primary test applied during examination was – and remains the classic statement of Aickin J, in Wellcome Foundation, namely, “whether the hypothetical addressee faced with the same problem would have taken as a matter of routine whatever steps might have led from the prior art to the invention, whether they be the steps of the inventor or not”.
- The standard of proof for inventive step was – and remains that the Commissioner must be “satisfied, on the balance of probabilities” that the various criteria are met. The balance of probabilities requires examiners to weigh up all the material before them and decide, on balance, whether an objection is more likely than not to be applicable.
Therefore, by simple comparison of what has changed versus what hasn’t, it is possible to distil our enquiry down to the notion that the bar will only truly be raised on inventive step if CGK (internationally) is tangibly broader than CGK (locally); and/or that the removal of “ascertained” may actually broaden the citable prior art. Addressing each in turn:
Is the CGK likely to be any different post-RTB?
Under Australian practice – and beginning from first principles, an objection on the grounds of an alleged lack of an inventive step can eventuate where one of the essential features of a patent claim has not been previously disclosed, but would nonetheless suggest itself (i.e., be obvious) to the notional skilled addressee. The examiner assumes the mantle of this skilled addressee, apprised of the CGK in the art – and attempting to solve the specific problem addressed by the claimed invention. For an objection to arise, it must be established that the prior art would, as a matter of course, be relied upon by the skilled person seeking a solution to the problem – and that any combination of the CGK with that prior art information would naturally suggest itself to the skilled person.
From an international perspective, the Australian method is fairly standard – for instance, there are distinct elements of the United Kingdom’s Windsurfer test embroiled in the Australian approach. However, as mentioned above, the first of the post-RTB changes removes any geographical limitation upon the CGK. The question therefore becomes “is the CGK in Australia any different to what it is globally”?
Under the old law, where a foreign publication was relied upon as being indicative of the CGK, examiners must also have demonstrated that the publication was well known in the relevant art in Australia. Usually, this followed as a matter of course from the precedent of Bristol-Meyers v Faulding, where it was stated:
“If a patent application, lodged in Australia, refers to information derived from a number of prior publications referred to in the specification or, generally, to matters which are known.. ..the knowledge thus described is.. ..part of the common general knowledge as it existed in the patent area”.
However, there were exceptions under the old Act – occasions in which the geographical limitation upon the CGK was invoked. The seminal case here is that of BHP v Nippon, in which it was held that in a Japanese-originating Australian patent application, an admission that another Japanese patent document was well known did not suffice to establish that the document was in fact CGK in Australia. Whilst it is clear that the BHP precedent will no longer stand post-RTB, it is also worth noting that this case, like any other, turned on specific facts which possibly make it a one-off; the exception rather than the rule.
Furthermore, under the old Act, many arts were considered to be somewhat “international” in nature – and it followed therefore that the CGK in Australia was essentially the same as it was internationally. For example, it was recognised that genetic engineering (Genentech Inc’s Patent) and organic chemistry (Biochem v Emory) were truly “international” arts – and that therefore, the CGK in Australia was taken to be the same as it was globally.
Net effect of globalising the CGK
It is probably no coincidence that the most recent authorities cited above correspond with the dawning of the information/internet age. Even in the absence of the post-RTB changes, one would have to suspect that invoking a geographic limitation upon the CGK would be drawing a rather long bow in an age where information can be disseminated from one side of the globe to the other in milliseconds. As a consequence, other arts – especially those based upon pure or applied sciences – could have been reasonably expected to follow suit.
The bottom line is that under the old Act, the geographical limitation upon the CGK was seldom, if indeed ever invoked. Although RTB doubtless streamlines things, it does seem reasonable to approximate that “CGK now” may be at least substantially similar to “CGK then”. Accordingly, removing the geographical limitation upon the CGK post-RTB may actually have very little effect upon what is and what isn’t taken to be CGK under Australian law.
Is removing the requirement that a prior art document be “ascertained” likely to make a tangible difference?
The second change foreshadowed above is an apparent loosening of the former situation in which not all prior art was strictly “citable” for the purposes of inventive step. Under the old Act, it was necessary to show that a prior art document used for assessing inventive step would have been “ascertained, understood and regarded as relevant” by the notional person skilled in the art. Under the new law, it is only necessary that the skilled person would understand and regard the prior art as relevant; the requirement that a document be ascertained has been removed.
Semantics? Perhaps. In Dyno Nobel v Orica the word “ascertained” was interpreted by the Federal Court as meaning “discovered” or “found”. Moreover, it has been generally accepted that a document dealing with the same technical issues as a subject patent would generally have been ascertained. In Rohm and Haas it was stated:
“A document would be ascertained if it was published in such a manner or form that it could reasonably have been expected to be found by a person skilled in the art. A patent document dealing with the same technical issues would prima facie have been ascertained by a person skilled in the art. The requirements of understood and regarded as relevant are not likely to be an issue where a document relates to the same art as the problem”.
Rohm and Haas thereby establishes the premise that a document would have been ascertained as the rule, rather than the exception. Moreover, the court applied a “diligent searcher” test in determining whether a document was likely to have been ascertained. The following quote actually comes from the UK decision in Technograph v Mills:
“[T]here may be documents which, although available, would never be looked at by anyone making such a search as our hypothetical addressee is supposed to have made.. [the prior art includes] matter which in fact no-one.. ..ever knew or was likely to know, such as the contents of some foreign specifications which no-one had ever looked at and which the most diligent searcher would probably miss. ..the words should have the more natural meaning of what was or ought to have been known to a diligent searcher”.
The combination of a diligent searcher working within a similar technical field makes it difficult to see how a document could ever have been other than ascertained. Furthermore, when applying the old law, examiners would generally proceed on the basis that it could be reasonably expected that the skilled person would conduct a search of the patent literature and that any patent document located in such a search could reasonably be expected to have been ascertained as a result. It follows that the more technical the field of endeavour, the more likely a patent search would have been conducted by the skilled person. For instance, if one was working in the field of genetic engineering, failing to conduct a patent search may be tantamount to negligence; the old law, quite simply, reflected this notion.
That said, there have been exceptions to the general rule expressed above. In the past, prior art documents have been excluded from consideration on grounds including too-recent publication; not being in English; not being directed to solving the same problem as the claimed invention; held in an obscure location; in a technology not generally associated with the patent literature; or even an obscure-yet-relevant statement in an otherwise irrelevant document.
Therefore, although exceptions did exist under the old Act, they were few and far between. It is also worth noting that any such documents would only have been excluded after an exhaustive evidentiary process. In this respect, one can readily appreciate the manner in which the new Act stands to streamline Australian patent practice. Irrespective of whether removing “ascertained” actually raises the bar, it is thought that practitioners will likely welcome this change; it removes one of the more “clunky” features of Australian patent law. Previously, during examination, opposition or revocation matters, the requirement to argue as to whether a document would or wouldn’t have been ascertained (when the outcome, as related above, was largely predetermined) created an undue burden upon applicants, opponents and decision-makers alike.
Net effect of removing “ascertained”
Bottom line: Again, one would be somewhat unlucky if their inventive step assessment under the new Act differed markedly from that conducted under the old Act. As with the CGK changes discussed above, what we’re really talking about here are the minutiae – the “one case in a thousand” that turns on one of these quirks.
Whereas it was clearly advisable to establish an Australian patent application as an “old Act case”, we would obviously want to temper any impression that if an applicant failed to do so, it was necessarily “game over”. As shown above, when it comes to inventive step, one would be fairly unfortunate to fall foul the new Act for an application that would have been successful under the old – and even then, the Australian patent system provides for a relatively “soft landing” by way of the facility to convert a standard patent application into one for an innovation patent.
In summary, we believe that the changes – whether they actually “raise the bar” on inventive step or not, are a good thing. They serve to make Australian patent practice slightly less idiosyncratic and thereby more consistent from an international perspective. From our standpoint, fewer idiosyncrasies equal more certainties; more certainty equals more attractive to foreign patent applicants. As one will doubtless appreciate, determining and arguing inventive step under Australian law had been somewhat unique to our local practice. Imagine, for a minute, the sum total of time and expense spent arguing either the geographical limitation of the CGK, or whether something would have been ascertained. Now apply the teaching of this article – namely, that the outcome may have been largely predetermined anyway. With that, we believe one may discover the true motivation for the RTB changes – consistent and reliable? Sure, but more likely, streamlined and efficient.
Is Raising the Bar more “an attitude”?
Finally, it is worth noting that the above discussion reflects the “letter of the law”. How this is interpreted by the Patent Office (both during examination and opposition) and the courts is probably a better indicator as to whether standards will truly be raised on inventive step under the amended legislation. In other words, in order to truly “raise the bar” on inventive step, all it takes is for one, or indeed all of these authorities to adopt a relatively hard line. By corollary, the bar will then have been raised.
Letter of the law aside, Raising the Bar is an attitude.
Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (No. 35, 2012); An Act to amend legislation relating to intellectual property, and for related purposes
Explanatory Memorandum to the Intellectual Property Laws Amendment (Raising The Bar) Bill 2011, Schedule 1
Patents Act 1990 (Cth), section 7(3)
IP Australia, Patent Manual of Practice & Procedure, sections 126.96.36.199 and 188.8.131.52A “Assessing Inventive Step in Examination”
Wellcome Foundation Ltd v VR Laboratories (Aust) Pty Ltd (1981) 148 CLR 262 at 286
Windsurfing International Inc. v Tabur Marine (GB) Ltd., 1985 RPC 59
Bristol-Meyers Squibb Co v F H Faulding & Co Ltd 46 IPR 553
BHP Steel (JLA) Pty Ltd v Nippon Steel Corporation  APO 69
See also, Beissbarth GmbH v Snap-on Technologies Inc.  APO 20
Genentech Inc’s Patent  RPC 613
Biochem Pharma v Emory  APO 50
Dyno Nobel v Orica 47 IPR 257
Rohm and Haas Company v Nippon Kayaku Kabushiki Kaisha and Sankyo Company, Limited  APO 40
Technograph v Mills and Rockley  RPC 346
IP Australia, Patent Manual of Practice & Procedure, section 184.108.40.206.1 “Ascertained”
Wrigley v Cadbury  FCA 1035
Euroceltique v Sandoz  APO 21
Lockwood v Doric  HCA 58
B.C.D. Mecanique Ltee v Madness Gaming  APO 70
Commissioner v Emperor Sports  FCAFC 26