Patent prosecution highway agreements (“PPH”) appear to be all the rage, and the reasons that patent offices like them are obvious (discussed more fully in a separate post). However, PPH agreements represent an enormous change to patent prosecution that will have profound consequences for patentees, licensees and infringers, patent agents/attorneys, and national patent offices. Some of these consequences will be very positive, and some will not. But considering how significant the changes and challenges ahead are likely to be, it is remarkable how little discussion PPHs have generated.

In a series of posts, I will try to explore the challenges, opportunities, and uncertainties arising from patent offices setting off on these highways, often without much consultation.

First, some terminology. ‘Patent prosecution highway agreements’ are bi-lateral and multi-lateral agreements between nations (or their respective patent offices), which permit patent examiners in one country to recognize (and perhaps adopt or defer to) the work performed by their peers in another country. Most PPH agreements purport to be reciprocal (although the extent to countries and courts will respect that reciprocity is one of the most open issues arising from PPH agreements.)

miltons ip - Canadian intellectual property law

The recent RIM BBX trademark fiasco has all the appearances of being a ‘what were they thinking?’ and “don’t they know the basics of trademark law?” sort of moment.

On December 6, 2011 Research in Motion (RIM) was temporarily enjoined by US Federal District Court, in Alburqurque, New Mexico from using BBX as the name of their newest operating system at an upcoming trade show in Singapore.  The order was issued on the eve of the Singapore show, which surely must have been a bit of an inconvenience to RIM’s trade show reps.

The decision is found here.

RIM has now re-branded the operating system as BlackBerry 10.

The case touches on some very thorny issues of the extra-territoriality of US court decisions (at least thorny to everyone in the world except Americans), but as it does not appear that RIM alleged that it had no intention of ever using the BBX mark in the US, the thorniest of these issues are skirted and I will address them another time.

Assuming that RIM ultimately intended to use BBX in the US, it looks like RIM tried to pull a classic trademark ‘no-no’.

Basis International Ltd. has a US trademark registration dating from 2006 for the trademark BBX for use in association with:

• Computer programs and associated documentation providing tools and programming language to enable software developers to create and prepare business, internet, and applications software

RIM intended to use BBX in association with the operating system on its well-known smart phones.  The Basis mark is OS-agnostic tools for developers; the RIM mark was to be used for an OS.   Holy alarm bells, Batman !

The Court held that the products intended consumers and channels of trade were the same.  And with all due respect to RIM, whether the intended consumers and channels of trade are identical or not, they are clearly pretty similar.  Thus, this is pure trademarks 101: don’t use the same mark on the same or similar products sold to the same or similar consumers in the same or similar channels of trade.

In fact, considering that the incumbent (Basis International) is overtly OS-agnostic, and the newcomer (RIM) wanted to use the mark on an OS, RIM’s position is almost deliberately inflammatory.  What were they thinking?

Perhaps we have missed something but on its face this case stands as an object lesson in how not to approach branding.

What all brand owners should do, before launching a new brand in a competitive globabl market is:

•  Try to devise a very unique name (acronyms are NOT good brands);
• Search.
• Search again.
• Search some more.

And, if despite all of your clearance searches you confront a problem later on, bite the bullet early, and re-brand.

miltons ip - Canadian intellectual property law

A post in yesterday’s Economy Lab blog of the Globe and Mail asks the very pertinent question Is ‘innovation’ another name for corporate handout? 

Wasteful handouts are a frequent result of pressure for ‘an innovation strategy from government’  but this does not need to be the case.  The key problem is that ‘innovation’ is a sexy buzzword, but is usually not defined with adequate rigour.

Innovation is about making something that people want (“need”) “better, faster and/or cheaper”.  Every element of this is important: innovation is about improvemens to a good or service (or the delivery of the good or service) that people want/need, in a manner that makes the good or service delivered better.

Innovation is not invention. Innovation is not research.  Invention may be an important part of innovation, but it need not be.  Innovation is not about simply ‘hi tech’ products, nor should it be restricted to cutting edge activities like bio-tech, nanotechnology, or clean tech. These areas are important, but often the most important innovations are improvements on mature, well-established products and services.

Increasingly, “better” means ‘in a more sustainable manner’.  “Better” can mean using less energy or creating less waste or many similar things. 

However, the most commercially successful innovations are usually ones that make the item cheaper for the payor, as well as better in some other important metric (easier to use, faster …).

The economies of the developed world are overwhelming (over 70%) about the delivery of services (‘doing things’ rather than ‘making things’).  Accordingly, in order to have meaningful economic impact, the most important innovations will be in the service sector.  For example, iTunes and NetFlix are examples of innovative services having profound impact on an entire industry (‘retailing of music’, and ‘retailing of all movies/video’). 

Huge sectors of the developed world are services delivered by government or public sector entities.  For example, in Canada, health (over 10% of the economy), education (also about 10%) are completely dominated by the public sector.  Governments that want to foster meaningful innovation need to avoid the easy, and totally pointless, exercise of handing out money to a few ‘high tech’ businesses.  It is pointless because these industries are a miniscule fraction of the total economy.  It is a waste because it is virtually impossible for government to pick winners.  All that happens is that taxes are taken from those successful enough to generate income to those with grant-writing skills.

The innovation policy of every government in every jurisdiction should be to innovate in the delivery of the services that they deliver.  And, while obviously there is a need for innovation in high profile, large sectors of the economy like education, transportation and health, those are likely to be very politically charged. 

A government that is serious about innovation but wants to avoid being embroiled in high profile controversy should realize that there is enormous opportunity to innovate by tackling the ‘plumbing’ of service delivery by government to make the delivery of  “peace, order and good government” better, faster and cheaper. 

For example, real estate is an enormous chunk of a modern economy (too much in some countries over the past decade), and while in the developed world most real estate development is by the private sector, it is a fundamental task of government to provide a system for registering title to land – and hence for registering charges against title (like mortgages) and transfers of title.   Transaction costs in selling and borrowing against land (mortgages) create enormous waste and delay.   The better the ‘government’, the lower the transaction costs in real estate transactions and the more accurate, fair, and accessible the land registry system (a fundamental problem in many ‘developing nations’ is the lack of proper land titles to land especially in shantytowns, which creates an enormous barrrier to economic development).

In Ontario, the provincial government created an enormously successful on-line land registry system known as Teranet.  It did so in partnership with the private sector (a cash cow of the first rank it has since been sold several times, and now the system is owned by the pension plan for the municipal employees of Ontario !).  Terant was a dramatic innovation resulting in better governance – the entire land registry system in Ontario is now better, faster, cheaper than it was, to the benefit of all Ontarians.

The lessons of Teranet are two-fold:  Ontario should a) try to export Teranet to other jurisdictions, and b) Ontario shouuld take the lesson of Teranet to heart and try to implement similar systems in other areas where it delivers services.  For instance, the equivalent system in Ontario for registering liens against personal property (the “PPSA system”) is not nearly as good as Teranet (although it is vastly superior to CRAC, the system in neighbouring Quebec which is awful).  Or even more acutely, Ontario lacks a proper court registry system: the current state of court registries in Ontario is appalling – paper, paper everywhere as if computers (not to mention the internet) had never been developed.  If the Province of Ontario wants to be serious about useful innovation it should fix this disgrace – not throw money at wind power, and not give handouts to start ups.

miltons ip - Canadian intellectual property law

The Globe & Mail has been running an interesting and useful series on the Canadian economy called Canada Competes on the theme of competitiveness and thus with articles on themes such as innovation, productivity, and trade.

However, this week there is yet another article from employees of one of Canada’s largest companies in which the employees bemoan the lack of innovation among ‘Canadian companies’.  Through no fault of the Globe’s, these talking head pieces are strikingly repetitive and useless.   These articles they share a common (and very dated) assumption that competitiveness and innovation are all about manufacturing and selling products.  Today’s (found here), from Deloitte’s captures this spirit entirely. This mis-conception is dated and highly misleading, and if used to direct public policy will cause significant wastes of money and effort.

The Canadian economy is over-whelmingly about services: doing things, not making things.  The trend towards services has long roots, and will continue.  The high CDN $ (driven there by high commodity prices), means that the future for manufacturing in Canada is dim, and Ontario in particular has an urgent need to focus on improving its service industries as a result.

If Canada wants to move the needle on innovation and productivity, it must do so in the large service sectors of the economy: health, education, government, telecommunications, financial services, and professions like law, engineering and accounting.    It is in these sectors where innovation must occur, and where productivity enhancements are sorely lacking.  In fact, in Canada many of these sectors are deliberately protected from competition (eg. health, telecommunications), are overtly hostile to innovation (eg. all facets of education of the education industrial complex), and consciously resist importing talent (engineering, law, medicine, accounting) and shy away from exporting services (health, education, banking …)

Moreover, to make real headway, the efforts need to be a companies that are large by Canadian standards (likely small by world standards) who are pushing to become world class.  Real progress on a national scale on productivity and innovation will not come from start-ups.

[Our firm is committed to innovation and productivity enhancement, and we are a significant exporter of services, but of course only in our small corner of the world - patent and trademark agency].  If Canada is to enhance productivity, its governments, public sector service providers, and service businesses need to step up.

Enough about manufacturing.  Let’s here from Deloittes how Canadian accountants are taking risks and being entrepreneurial to produce more services ‘better, faster, cheaper’.   And let’s here how BMO is innovating to export its expertise in banking.

As a side note, I commend the marketing departments of Deloittes and BMO for getting these puff pieces into the Globe, and distribution far beyond what the content warrants.

miltons ip - Canadian intellectual property law

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miltons ip - Canadian intellectual property law