Saturday, 17 April 2010

Impecuniosity and renewing patents

Owning intellectual property is just a bit like owning a dog - you can't leave it to fend for itself: it will cost you money from time to time. There, I think, the resemblance ends, and out of respect for the Dog's Trust's trade mark rights I won't say "A patent is for life ...".
The law recognises that sometimes people will fail to pay the renewal fee on time, or even within the extra period during which they can renew with a penalty (six months, under section 25(2) o f the Patents Act 1977). Under Section 28(3) if you fail to renew and the patent lapses you can still seek to have it restored: 19 months is allowed for this by allows Rule 41(1)(a) of the Patents Rules 1995. But the comptroller has to be satisfied that you took reasonable care to see that the renewal fee was paid in time.
In Betson Medical (Ireland) Ltd v Comptroller General of Patents [2010] EWHC 687 (Pat) the unfortunate Mr Betson found himself unable to pay the renewal fees for a patent that he had assigned to the claimant company, which he had set up to exploit it (and other patents). It's a state of affairs that, with variations, I have come across many times, and every practitioner has probably seen. The problem was that the evidence, though it showed that he was struggling to make ends meet and was being bailed out by friends, did not reveal anything that looked like reasonable care to renew the patent. He raised money from a private investor, but the investor seems to have done so much due diligence that by the time the money became available it was too late. But, more to the point, it seems that Mr Betson didn't ask for a relatively small investment to secure the patent (which presumably was a significant part of what the investor was investing in), he was after a much bigger sum to finance subsequent activities too. And most important of all for the Comptroller, he treated the patent portfolio as a whole whereas for the purposes of the Act he should have tried to get hold of the €359.37 needed to renew the European patent UK. What happens with the other patents in the collection is of no interest to the Comptroller, under our legislation - and that, I think, is the lesson to be learned from this case.
The court (to which the case came on appeal from the Hearing Officer) noted that although the appellant company was said to be impecunious (a word probably getting more use in this judgment than it has since Dickens passed away) it seemed to be racking up an impressive overdraft, indicating that had it sent a cheque to the Patent Office when the renewal originally fell due all would have been well. The judge (Kitchin J) also observed that the friends who were providing the wherewithal to pay utilities bills and the like might have been prepared to put their hands in their pockets again for the UK renewal fee, but there was no evidence that they were asked. It doesn't mean that asking in a similar situation will make restoration possible, but it does show the sort of evidence that is needed, and which, sadly, Mr Betson did not adduce.

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