The EPO’s Enlarged Board of Appeal decides how the EPO should assess entitlement to priority

The Enlarged Board of Appeal of the EPO has now issued its long-awaited answers to the legal questions referred to it in cases G 1/22 and G 2/22, and in doing so the EBA have set out a new approach for assessing entitlement to priority which EPO departments must now apply to the cases before them. With a few exceptions, the new test is emphatically pro-applicant and pro-patentee.

Background to the referral

The background to the referred questions was explained in our earlier blog here. The referral was made from two related cases: T1513/17 and T2719/19. In each of those cases, the application derived from a PCT application claiming priority from a US provisional application filed by three inventors (collectively so-called “Party A”). The PCT application named co-applicants i.e. the same three inventors as applicants for the US only, but only a corporate entity (so-called “Party B”) as applicant for other states including the EPO. On the evidence, only one of the inventors had transferred their priority rights to the corporate applicant before the PCT was filed. Party B’s entitlement to priority was challenged in EPO opposition and appeal proceedings, and it was agreed that clarification of the EPO law in this area was required.

Two questions were posed by the referring Board of Appeal:

Question 1 was rephrased slightly by the EBA to “Is the EPO competent to assess whether a party is entitled to claim priority under Article 87(1) EPC?”

Question 2, in essence, asked whether Party B could rely on the priority right at the EPO, despite the fact that Party A (who filed the US provisional) was not named as a co-applicant for the EPO designation.

The answers to the questions

The EBA answered the questions as follows (with emphasis added):

1. The European Patent Office is competent to assess whether a party is entitled to claim priority under Article 87(1) EPC. There is a rebuttable presumption under the autonomous law of the EPC that the applicant claiming priority in accordance with Article 88(1) EPC and the corresponding Implementing Regulations is entitled to claim priority.
2. The rebuttable presumption also applies in situations where the European patent application derives from a PCT application and/or where the priority applicant(s) are not identical with the subsequent applicant(s). In a situation where a PCT application is jointly filed by parties A and B, (i) designating party A for one or more designated States and party B for one or more other designated States, and (ii) claiming priority from an earlier patent application designating party A as the applicant, the joint filing implies an agreement between parties A and B allowing party B to rely on the priority, unless there are substantial factual indications to the contrary.

Thus the EBA have said that the EPO should apply its own (“autonomous”) law to assessing the question of entitlement to priority.

As they go on to explain in the decision, the new approach generally assumes that entitlement to priority exists, and that any transfer of the priority right needed to put this into effect can be inferred to have taken place. There are apparently no formal requirements at all under the EPO autonomous law for transfer of the relevant rights between the relevant “priority” applicant and the “subsequent” applicant.

When applying the new approach to the “joint PCT applicants” situation underlying Question 2, the assumption would be that the EPO priority entitlement is valid, absent substantial evidence to the contrary.

This approach will undoubtedly benefit applicants and proprietors who have either entirely or partly failed to formally transfer the required priority rights before filing a subsequent PCT or EP application. Similarly, it will make things harder for opponents seeking to challenge the priority claim on the basis of an imperfect transfer. However, as we explain below, it is not a complete panacea and situations will still exist where priority may be put into question in EPO proceedings.

Why arrive at these conclusions?

In terms of deciding that it was competent to assess priority entitlement, a key factor for the EBA was apparently that if the EPO was barred from assessing priority entitlement, situations could arise in which the EPO had evidence potentially affecting the patentability of an invention but could not use such evidence in its decision on patentability.

In terms of applying autonomous EPO law, the EBA apparently agreed with the proposition that since the creation, existence, and effects of the priority right are governed by the EPC, the priority right must be considered an autonomous right under the EPC and should therefore be assessed only in the context of EPC law (regardless of any national laws). Furthermore, applying only the autonomous law of the EPC to the transfer of priority rights removed the need for “conflict of laws” rules and the application of national laws.

In terms of applying a rebuttable assumption of priority entitlement, the EBA argued that this assumption reflects the fact that the priority applicant can typically be presumed to accept the subsequent applicant’s reliance on the priority right because, for example, their cooperation is required in supplying documents and so forth. Furthermore, this approach provides for legal certainty as all those involved can assume that the subsequent applicant is entitled to priority unless there are specific facts which support serious doubts about such entitlement. There will be a high burden of proof on those challenging the assumption.

In terms of applying a “low standard” for the transfer of the priority right, the EBA argued that this not only served the purpose of harmonisation with national laws (some of which apparently accept “informal” or “tacit” transfers of priority rights, under almost any circumstances) but also served the fundamental purpose of priority rights i.e. facilitating international patent protection, by reducing the risk that the relevant parties’ interests are jeopardised by inadvertently failing to meet formal requirements. The EBA cited, apparently with approval, the statement from the UK courts that there was “no obvious public interest in striking down patents on this ground, unlike all the other grounds of invalidity.”^[1]

Effect on PCT applications with co-applicants for different states

As explained above, in relation to Question 2, the rebuttable assumption concerning valid transfer of the priority right applies to EP applications deriving from PCT applications with co-applicants for different states, as with any other EP applications. Additionally, and independently, the EBA considered that such a joint filing was in itself proof of an implied agreement to validly transfer such rights. However, where one co-applicant of the priority application (e.g. an inventor named on a US provisional) is not involved at all in a subsequent application, such an implied agreement cannot be inferred.

In the reference to the EBA, the referring Board of Appeal had queried whether the so-called “PCT joint applicants approach” might be a yet further basis for concluding that priority was validly claimed. That approach argues that because the PCT applicants overall have the right to priority, this right also applies to the EP designation and later EP application, irrespective of any actual transfer of rights, since the priority right in the PCT application has a unitary character for all designated states. The EBA left open the question of the correctness of this original approach, although they were apparently sceptical of it.

The EBA did sound a note of caution in relation to PCT applications, observing that the PCT does not exclude that different priority rights might exist for different designated territories, whether for material reasons (e.g. the “same invention” criterion as applied to the claimed subject-matter claimed before the respective patent office) or formal reasons (e.g. the applicant for one territory is in fact simply not entitled to a priority right while another applicant for another territory is). Thus, third parties should not simply assume that all priority rights are shared by all applicants for all subject matter in all territories.

Other limitations to the EBA’s new approach – interaction with national laws

The EBA stress in the decision that the presumption must be rebuttable since in rare cases the priority applicant may have legitimate reasons not to allow the subsequent applicant to rely on the priority. The EBA suggests that this might arise, for example, from bad faith behaviour on the side of the subsequent applicant or to other disputes, such as litigation before national courts about the title to the subsequent application.

Although the EBA allow no room for the application of national law in relation to the general rebuttal of legal presumptions, they acknowledge that in specific cases, national laws may need to be considered as well e.g. to decide on the existence of legal entities who may be parties in the transfer of priority rights.

Of course, as with any finding of patentability, the EPO’s decision on priority cannot be binding on separate proceedings in national courts.

One scenario which has arisen in earlier decided cases of the EPO Boards of Appeal is where the priority application and right is clearly assigned to a third party, but then some yet different, wrong, party is named as the applicant in the subsequent application^[2]. This may happen, for example, because the intervening assignment was forgotten about, or simply because of some error in naming the subsequent applicant.

In such scenarios, while a rebuttable assumption of priority entitlement to the ‘wrong’ subsequent applicant presumably still exists under the new EPO approach, it would seem to be completely rebutted by the effective intervening assignment to someone else (unless the third party had some intention of transferring the rights on to the ‘wrong’ applicant). In such scenarios it may be necessary to consider other ways of perfecting priority, such as correction with retroactive effect^[3] or entitlement proceedings both to correct the applicant and to perfect priority.

Interestingly the EBA appear to find it “questionable” whether the transfer of the right of priority needs to be concluded before the filing of the subsequent patent application, thereby perhaps opening up the possibility of retroactive assignments. However the EBA apparently avoid a clear position on this. The general principle that entitlement to priority must be correct at the time of filing is thus seemingly still good law.

Conclusions

As predicted in our earlier blog here, the EBA has taken the opportunity to confirm the EPO’s competence in deciding issues of priority entitlement, and has also found a way to avoid what they clearly see as the disproportionate outcome that patents might be invalidated through lack of priority entitlement, despite all the parties involved in the priority and subsequent application intending that the priority claim be valid.

These decisions (consolidated G 1/22 and G 2/22) arguably continue a trend of more pro-applicant decisions by the EBA in relation to priority, after earlier more negative ones. Decision G3/93 in 1994 overturned earlier cases in deciding that if the content of the priority document was published in the priority interval, this could be cited against any claims in a subsequent application not entitled to priority. Decision G2/98 in 2001 established a strict test for substantive priority entitlement analogous to added subject matter, although the EBA could have decided a lesser degree of correspondence was appropriate for the “same invention” test. However, more recently, G1/15 in 2016 took a more pro-applicant approach, and allowed some flexibility in relation to how partial priority can be attributed to claimed subject matter, which meant that (amongst other effects) there was a reduced risk that a broadened claim in a subsequent filing could self-collide with earlier narrower definition in a priority filing (so-called “poisonous priority”).

The new test created by the EBA in these latest decisions will make it harder to challenge entitlement to priority, both in terms of setting a very high burden of proof on the challenger, and in deciding that no formal requirements are required to transfer title to the priority right. The new law applies to opponents seeking to undermine a priority claim, but also to patent applicants or patentees faced with an earlier EP application cited as intervening prior art under Art 54(3). The priority entitlement of such an earlier EP application will also be assumed by default to be valid. Although there are situations where the new tests may not be relevant (for example where an entirely non-entitled applicant is named) we can expect to see significant changes in how the Opposition and Examining division decide on priority entitlement as the autonomous law develops.

References

1. Accord v RCT [2017] EWHC 2711 (Ch) (point 77)
2. See e.g. T725/14
3. PCT Rule 91.1; EPC rule 139