IP ENFORCEMENT. IP Leaders in Spanish and Portuguese speaking countries. Igor Simões
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1 IP ENFORCEMENT Igor Simões IP Leaders in Spanish and Portuguese speaing countries Clare, Modet & Cº 2006 Líderes en Propiedad Industrial e Intelectual en países de habla Hispana y Portuguesa 2012 Clare, Modet & Cº
2 Agenda 1. Industrial Design 2. Subsides to Invest in Brazil: BNDES 3. Licensing 4. Enforcement of Patents in Brazil 5. Discovery and Preliminary Measures (How are damages calculated and estimated costs?) 6. Enforcement Climate 7. Recommended Protection Strategies Clare, Modet & Cº Clare, Modet & Cº
3 INDUSTRIAL DESIGN Clare, Modet & Cº Clare, Modet & Cº
4 Definitions An industrial design is any ornamental three-dimensional form of an object or any ornamental arrangement of lines and colors that may be applied to a product, that obtains a new and original visual result in its external configuration and that may serve as a model for industrial manufacture. Novelty: Applications must be filed before the design is made nown by written or oral description, use, or any other means anywhere Under the International Convention, priority may be claimed within six months of filing the first Convention application Novelty of an industrial design is not voided by disclosure of the design within the six-month grace period preceding the filing date or the priority date of the industrial design application The owner of a registered industrial design may, at any time during the term of registration, request examination as to novelty and originality of the subject matter of the registration. Clare, Modet & Cº Clare, Modet & Cº
5 Registrable An industrial design is a single article, of which a plurality of variations are permitted, provided they are intended for the same purpose and all possess the same predominant distinctive characteristic. Each application is limited to 20 variations. An industrial design is considered original if it results in a visual configuration that is distinctive in relation to existing objects. The original visual result may be the result of a combination of nown elements. Wors of a purely artistic nature are not considered industrial designs. Not registrable: an industrial design is not registrable if: it is contrary to morality and decency; it offends the honor or image of persons; it is contrary to freedom of conscience, belief, religious cults or ideas and feelings worthy of respect and veneration; it is the necessary common or ordinary shape of an object; or is a shape that is determined essentially by technical or functional considerations. Clare, Modet & Cº Clare, Modet & Cº
6 Procedure Applications are subjected to a preliminary formal examination ONLY The industrial design is published automatically, registration is simultaneously granted Documents required: A request for registration A description, where applicable Claims, where applicable Drawings or photographs, which must clearly and adequately represent the article and its variations in such a manner as to permit its reproduction by a person silled in the art The field of application of the article Proof of payment of the filing fee Clare, Modet & Cº Clare, Modet & Cº
7 Procedure Opposition Administrative nullity proceedings may be instituted within five years from the grant of registration at the request of any person having a legitimate interest Duration and renewal Registrations have a term of 10 years from the filing date and are renewable for three successive five-year periods Clare, Modet & Cº Clare, Modet & Cº
8 SUBSIDES TO INVEST IN BRAZIL: BNDES Clare, Modet & Cº Clare, Modet & Cº
9 Brazil is one of the fastest-growing major economies in the world with an average annual GDP growth rate of over 5% Brazilian economy has been predicted to become one of the five largest economies in the world in the decades to come (Global Economics Paper No: 153 Goldman Sachs. Retrieved on ) Clare, Modet & Cº Clare, Modet & Cº
10 Subsides to invest in Brazil BNDES is the largest development ban in Latin America and is the best option for Brazilian and foreign companies to obtain funds to invest in Brazil. According to BNDES rules, the companies must fulfill some requirements, which basically are: fiscal, tax and social obligations must be up-to-date; satisfactory registration must be presented; enough guarantees to cover the ris of the operation; capacity to mae payment; applicant cannot be undergoing credit recovery; comply with legislation related to imports, in case of financing for imports of machinery and equipment; and comply with environmental legislation. There is a lot of options of fund support offered by BNDES and they basically depend on the size of the company and the area of investment (petrochemicals, biotech, etc.) Clare, Modet & Cº Clare, Modet & Cº
11 Innovation Law 10, 973/04 Supports alliances between universities and companies, and provides incentives to boost innovation and investments for public and private enterprises to share resources, raise capital and support IP rights. About 70% of Research and development expenses are financed with public resources. About 78% of Brazilian researches carry out activities within public institutions. Scientific capabilities x patent filings Clare, Modet & Cº Clare, Modet & Cº
12 Positive Law (Law /05) It established some fiscal incentives, such as: Significant reductions in taxes and contributions for companies that invests in research, development and innovation (RDI) Upon determining the actual profit for calculation of the Corporate Income Tax (IRPJ) and the calculation base of the Social Contribution on net Profits CSLL, the company can exclude about 60-80% of the sum of expenses incurred in a technological innovation project, depending on the number of researcher employees hired The exclusion of 20% of the total expenses incurred in a technological innovation project under a patent granted or registered cultivated plant varieties can also be made Direct deduction of 50% of the Excise Tax (IPI) that should be paid on the purchase of equipment destined to innovation can be made. This deduction is made directly on the purchase, which provides an effective and direct gain Clare, Modet & Cº Clare, Modet & Cº
13 LICENSING Clare, Modet & Cº Clare, Modet & Cº
14 Licensing According to Brazilian Law, the recordal of a patent and trademar license agreements with the Brazilian PTO is not mandatory. However, it is always recommendable to record the agreement, due to the following reasons: a. to produce effects against third parties, who will be aware of the agreement b. to allow remittance of royalties abroad c. to allow tax deductions The Brazilian PTO understands that the remittance of royalties must not exceed 1% of the net sales object of the agreement, should the parties are parent company and a local subsidiary Clare, Modet & Cº Clare, Modet & Cº
15 Licensing Royalties can only be remitted abroad in connection with trademars already registered. In other words, assuming that the license agreement includes pending trademar applications, royalties for the use of the pending mars cannot be remitted For the recordal, the following documents are necessary: Power of attorney. The signature must be notarized and legalized The original Patent License Agreement with the signatures of the parties duly notarized and legalized The agreement s translation into Portuguese language Clare, Modet & Cº Clare, Modet & Cº
16 Licensing In general, the term of a trademar license agreement is the same term of the respective registration. Since trademar registrations in Brazil are valid for 10 (ten) years and may be renewed, the license agreement has no specific term As for enforcement, the licensee may be invested by the licensor of powers to act against the infringement of the licensed trademar Clare, Modet & Cº Clare, Modet & Cº
17 Clare, Modet & Cº Clare, Modet & Cº
18 PATENT ENFORCEMENT IN BRAZIL Clare, Modet & Cº Clare, Modet & Cº
19 Patent Rights Extent of protection conferred by patents are determined by claims interpreted on the basis of specification and drawings A Patent confers right to preclude unauthorized third parties from maing, using, reproducing, offering for sale, selling or importing the object protected by the patent or obtained by the patented process, without the owners' consent Such right extends against those who contribute to those acts practiced by unauthorized third parties Clare, Modet & Cº Clare, Modet & Cº
20 Warning Letters Good option: It is a cost effective measure to stop infringement and avoid court actions. As legal proceedings may be expensive and time consuming, many patent owners usually prefer to first attempt settlement out of court before proceeding with court action. Warning letter may be served through Registry of Titles and Deeds; or Via the Courts requesting the cessation of infringing.activities In this case, the judicial notification will be addressed to the judge, who will summon the infringing party Examination of the patent application supposedly infringed may be accelerated, if a copy of the Warning Letter is submitted to the PTO Clare, Modet & Cº Clare, Modet & Cº
21 Enforcement of first instance judgment Competent Court Federal Justice Courts Federal Government or any of its entities State Justice Courts Private Parties Brazilian Justice is divided in two courts, namely: Federal Courts and State Courts. The Federal Courts have competence to judge all lawsuits involving government entities (such as the BPTO) while State Courts have competence to judge all lawsuits involving private companies or individuals Clare, Modet & Cº Clare, Modet & Cº
22 Patent Infringement is both a civil offense and crime two avenues are open to patentees to enforce rights Injunctive relieves are available in both jurisdictions Statistics are difficult as amount of nullity suits is insignificant. Judges are usually pro patents Patent rights are only nullified when very relevant prior art is submitted Clare, Modet & Cº Clare, Modet & Cº
23 Preliminary Injunctions Requirements for obtaining ex parte search an seizure order of infringing products 1. Fumus boni juris 2. Periculum in mora 3. In civil law, a preliminary injunction can be requested and granted at any time and even before Defendant comes aware of action. Patentee will have to convince the judge that failure to effect seizure may cause irreparable damage to him Clare, Modet & Cº Clare, Modet & Cº
24 Patent Infringement Actions in Brazil STJ (Superior Tribunal of Justice) STF ( Court (Federal Supreme State Tribunals State Courts Summons Infringer Clare, Modet & Cº Clare, Modet & Cº
25 Patent Annulment Actions in Brazil STJ (Superior Tribunal of Justice) STF ( Court (Supreme TRF ( Tribunal (Regional Federal of the 2nd REGION Designated Federal Court in Rio de Janeiro Summons Summons Brazilian PTO Patent Owner Clare, Modet & Cº Clare, Modet & Cº
26 Regular Procedures Lodging Initial Petition. Reply by Defendant. Judge s appraisal of case in order to regularize it. Judge appoints technical expert. Indication of technical assistants by parties and submission of questions to be responded by the Expert Clare, Modet & Cº Clare, Modet & Cº
27 Court appointed expert responds to parties questions and presents opinion Judge decides the case usually on the basis of opinion prepared by expert Decision is subject to appeal before a higher court second instance Clare, Modet & Cº Clare, Modet & Cº
28 DISCOVERY AND PRELIMINARY MEASURES HOW ARE DAMAGES CALCULATED AND ESTIMATED COSTS Clare, Modet & Cº Clare, Modet & Cº
29 Damages Valid Patent Calculation of Damages Damnum Emergens (damages caused to plaintiff) Existence of damages has to be shown in cognitive stage of proceedings Lucrum Cessans (lost profits) Clare, Modet & Cº Clare, Modet & Cº
30 Calculation of Damages Article 210 of Brazilian Patent Law 9.279/96 lists 3 options: Benefits that injured party would have gained had the infringement not occurred; or Benefits that were gained by infringer of the right; or Remuneration that infringer would have paid to holder of infringed right by grant of a license that would have legally permitted the use of right. Clare, Modet & Cº Clare, Modet & Cº
31 ENFORCEMENT CLIMATE Clare, Modet & Cº Clare, Modet & Cº
32 The judges of the main cities of Brazil, i.e., those who are in the specialized Courts have a good nowledge of patent law. On the other hand, the judges located in the smaller towns have large gap in this regard. The sentence enforcement is considered as a phase of the primary lawsuit, and it has occurred at the same Court that had rendered the decision. First instance usually taes 3-4 years before a first instance decision is rendered. As in most countries, first instance decisions are appealed and the time for an appeal to be decided depends on the State in which it is filed. Clare, Modet & Cº Clare, Modet & Cº
33 RECOMMENDED PROTECTION STRATEGIES Clare, Modet & Cº Clare, Modet & Cº
34 Definition of a good strategy to solve the problem or to prevent infringement activity is VERY IMPORTANT and will vary in a case by case basis. The specific approach to tae and the strategy to adopt depend on the patent owner s short and long-term goals, budget limitations, time constraints and nature of the infringer s operations. For instance, some forms of legal action may bring about financial costs that are out of proportion to the desired results, whilst the size and nature of the business operations of certain infringers may justify the adoption of both civil and criminal actions. There are more and more court actions being filed involving Patent Law in Brazil, but most of them are filed against the Brazilian PTO or ANVISA, aiming at reversing rejection decisions. Clare, Modet & Cº Clare, Modet & Cº
35 Chances of success will depend on: Strong Claims. Evidence of Infringement. Where to litigate. Judges are impartial. However, depending on the concrete case, they can be mildly pro local companies. Clare, Modet & Cº Clare, Modet & Cº
36 Argentina - Brazil - Chile - Colombia - Mexico - Peru - Portugal - Spain - Uruguay - Venezuela Clare, Modet & Cº Clare, Modet & Cº. All rights reserved. Clare, Modet & Co. refers to the networ of subsidiaries of Clare, Modet y Compañía S.L. each of which is a separate and independent 2012 legal Clare, entity Modet & Cº
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