Use of innovation patents as enforcement tools

What is an innovation patent?

Australia has a second-tier patent system which offers enforceable protection for inventions that may not meet the inventive step threshold required for standard patents.  An innovation patent requires an innovative step rather than an inventive step, a lower threshold that merely requires the invention to have a novel feature that makes a substantial contribution to the working of the invention when compared to the prior art.  The feature does not need to represent an advancement in the art and the innovative step threshold has been set by courts quite low, which can make challenging the validity of an innovation patent difficult.

An innovation patent provides a relatively quick and inexpensive way to obtain protection for inventions. Unlike utility models in other jurisdictions, an innovation patent can be used to protect methods or processes, including methods of treatment (innovation patents cannot be obtained for plants and animals, or biological processes for their generation). An innovation patent is usually granted within a month of filing the application and without formal examination.  However, an innovation patent cannot be legally enforced until it is certified through examination. The term of an innovation patent is eight years with renewal fees payable annually. 

Enforcement strategies using innovation patents

An innovation patent may be obtained in addition to a standard patent by filing an innovation patents as a “divisional” of a pending standard patent application. Once a competitor enters the market, the claims of the innovation patent be tailored to directly read on the infringing product or method, and the innovation patent certified through examination (which usually only takes a couple of weeks if no objections are raised). Thereafter, the certified innovation patent is available for enforcement.

Innovation patents provide the same relief against infringement as standard patents (e.g., injunctions, damages, account of profits). This coupled with the ease with which innovation patents can be obtained and the difficulty of challenging their validity, makes them an effective enforcement tool without exposing a corresponding standard patent to the risk of revocation. 

Whilst it is not permissible to obtain both a granted standard patent and a certified innovation patent with identical claims, claims of similar and overlapping scope can be obtained in parallel. As such, the enforceable claims of the innovation patent can be crafted such that they do not have any detrimental impact on those of in the standard patent. An innovation patent can be initially filed with any number of claims for optimum flexibility (e.g., with the PCT claims). However, the number of claims must be reduced to a maximum of 5 for certification.

Phasing out of innovation patents

Due in part to the enforcement advantages that innovation patents provide, the Australian Government has decided to abolish such patents and has passed legislation that phases out the innovation patent system over eight years from 26 August 2021 to 26 August 2029.

Critical deadlines

Key dates are as follows:

• Until 25 August 2021, there is no change and innovation patent applications may be freely filed for new inventions, subject to existing limitations.
• After 25 August 2021, innovation patent applications will be granted if they have a filing date of 25 August 2021 or earlier. Pre-existing patent applications or PCT applications designating Australia with a filing date of 25 August 2021 or earlier may serve as the basis for a new divisional innovation patent application or be converted into an innovation patent application.

All granted innovation patent rights are entitled to the normal eight-year term.

Recommendations

If enforcement of patent rights is anticipated (or even a possibility) within the next eight years, you may wish to consider either filing an innovation patent before 25 August 2021, or filing a standard or PCT application before that date that can serve as the basis for a divisional innovation patent filing.