Research News

Plain packaging for cigarettes does not violate international trade rules: With its confirmation of the original decision of the WTO Panel of 2018 the Appellate Body of the World Trade Organization in June aroused worldwide media interest and ended a legal dispute that had lasted almost a decade.

The backdrop: In 2012 Australia became the first country in the world to introduce uniform sludge-green packaging for cigarettes, with drastic pictures warning of the consequences of smoking. Regarding brands, it decreeds that all logos or trademarks were to be removed from tobacco packages and the brand name should be printed only in small standardised fonts. This prompted the four tobacco-producing countries Indonesia, Honduras, the Dominican Republic and Cuba to file a complaint via the WTO dispute settlement system. They argued the measures constitute a violation of the TRIPS Agreement (Agreement on Trade-Related Aspects of Intellectual Property Rights). After their complaint was dismissed in 2018 by the Panel, Honduras and the Dominican Republic raised an appeal, which was rejected in June.

Impact goes beyond trademark law

The decisions are likely not only to accelerate the implementation of “plain packaging” worldwide, but also to have impact far beyond the tobacco industry. The current publication “The Revitalisation of the Object and Purpose of the TRIPS Agreement: The Plain Packaging Reports and the Awakening of the TRIPS Flexibility Clauses” by Christophe Geiger and Luc Desaunettes-Barbero shows that the impact of the decisions goes beyond trademark law and even opens up new room for interpretation of the whole TRIPS Agreement.

The study focuses on the new application of the so-called flexibility clauses in the "plain packaging" decisions. These clauses entailed in its Articles 7 and 8 describe the objectives and principles of the TRIPS Agreement. While they have so far played only a residual role in the interpretation of the provisions of the Agreement in practice, the WTO dispute settlement bodies for the first time fully engaged with them in the “plain packaging” decisions. As a result, they conclude that public health may constitute a legitimate reason for limiting trademark use. 

The authors show that the new reading of Articles 7 and 8 offer the possibility for a more flexible interpretation of the TRIPS Agreement. This applies in particular to the limitations and exceptions. By refraining from using Articles 7 and 8 in the past, the WTO established a rigid interpretation of these exceptions: The focus was on a strong protection of intellectual property rights without taking into account that such an interpretation could lead to dysfunctional effects in individual cases. The “plain packaging” decisions offer the WTO members more flexibility to adapt intellectual property rights to new realities and the possibility to take into consideration conflicting human rights.   

The publication can be found here.

Digitization poses new challenges for patent protection. In particular, the large number of patent-protected individual components used in some products makes it difficult to identify all the relevant property rights and to acquire the necessary licenses.

Just over ten years after the last amendment to the Patent Act by the (first) "Act to Simplify and Modernise Patent Law" the, the Federal Ministry of Justice and Consumer Protection submitted a discussion draft at the beginning of this year that provides for a selective revision of the Patent Act. At the heart of the amendment is the flexibilisation of the injunctive relief in Section 139(1). This grants the patentee the right to prohibit the use of his patent by third parties. The discussion draft proposes to insert a third sentence to the Section, clarifying that the enforcement of the injunction can be excluded in individual cases if it would be disproportionate.

Suggestions for the further legislative process
 

In practice, such constellations are likely to arise in the case of "complex products" which often comprise a large number of individually patented components that, in themselves, contribute only marginally to the value of the final product. As a result, each patentee enjoys a position of power that is out of proportion with the contribution of its invention to the final product, since the patentee can, under certain circumstances, stop the production of a product with an injunction. In the case of standard-essential patents (SEPs) or “non-practicing entities”, which do not have or do not want to establish any production capacity themselves, the granting of injunctive relief may also be disproportionate in individual cases.
 

The Institute, which issued a position paper on the discussion draft in March, in principle welcomes the proposed limitation of the claim to injunctive relief. However, the Institute does also provide certain suggestions with regard to the further legislative process, for example with regard to the criteria used for the assessment of proportionality. The discussion draft ties in with the principle of good faith; in the statement, the "leverage effect" of the injunction is in the foreground.  The authors are particularly concerned about the prioritisation of the patentee's interests over the interests of other parties or the public. “Such prioritisation is neither desirable as a matter of policy, nor justifiable by the exclusive nature of the patent right”, argues the position paper.
 

The position paper also criticizes the fact that the discussion draft rejects the consideration of third party interests and public interests in the context of the proportionality assessment categorically. The Institute contradicts the argument of the Federal Ministry that general interests are sufficiently and conclusively protected by the institute of compulsory licensing under Sec. 24 Patent Law.

Read the full text of the Institute's position paper here

The Bavarian Research Institute for Digital Transformation (bidt) has examined important questions concerning the spread and acceptance of work from home. To this end, bidt conducted a representative short survey among 1,595 employed adult Internet users in Germany. The analysis shows:

• The use of remote work has increased during the crisis.
• The satisfaction with the current situation of remote working is high.
• Before the Corona crisis, some employers did not allow remote work.
• Employers were generally well prepared.
• The acceptance of remote work has increased.
• The desire for more working from home is strong.

Dietmar Harhoff explains that there is a high level of acceptance among employees for remote work. The economy must take up this willingness, he says. Germany is lagging behind in the EU comparison when it comes to remote working. Home-based work is not only a question of organizational culture. It also leads to new management concepts and strengthens digitalization and innovative ability.

To the detailed bidt study (in German).

Here you can also listen to the podcast “Job Cuts and Remote Work: How Corona Is Changing the World of Work” (in German) in the NDR Info Speaking Time (30 April 2020) with contributions from Dietmar Harhoff.

Position Paper

Science governance and funding seek to promote excellent science output by allocating resources to those projects, researchers and institutions from which outstanding results are expected. But the commonly used measures for scientific quality, such as the number of citations, do not take into account the potential of scientific results for technology transfer and commercialization.

The findings of the new study “Science Quality and the Value of Inventions” by Poege et al. imply that what is considered excellent within the science sector also leads to outstanding outcomes in the technological and commercial realm. Excellent scientific articles are referenced in substantially more patent documents than articles with lower scientific quality. Patents with references to often-cited scientific contributions are of much higher commercial value than patents referring to less-cited publications.

The analysis comprises references to scientific contributions from 4.8 million patent families of the European Patent Office and the U.S. Patent and Trademark Office and approximately 43 million scientific publications in the Web of Science from the year 1980 onwards.

Previously known was the fact that patents with references to scientific publications are substantially more valuable than patents without a direct science link. The new study contributes the insight that the quality of the scientific bases is of crucial importance. Patents with references to excellent scientific publications are particularly valuable, while this does not apply to patents with references to low quality scientific publications.

The results indicate that quality measures commonly used in science can serve as good criteria for a system of science funding which simultaneously provides a basis for societal benefit and technological progress.

Science Advances is a peer-reviewed multidisciplinary open access journal published by the American Association for the Advancement of Science and complements the journal Science, referred to as Science Magazine, which has been published since 1880.

To the publication in Science Advances

The authors: Felix Poege Dietmar Harhoff Fabian Gaessler Stefano H. Baruffaldi

Suggested citation:

Poege, Felix; Harhoff, Dietmar; Gaessler, Fabian; Baruffaldi, Stefano (2019). Science Quality and the Value of Inventions, Science Advances, 5 (12), eaay7323 (11 December 2019). DOI: 10.1126/sciadv.aay7323

Artificial Intelligence (AI) changes - often invisibly - everyday life. In the field of IP law, however, AI raises new questions and challenges. A research project of the legal departments of the Max Planck Institute for Innovation and Competition led by Professor Reto M. Hilty and Professor Josef Drexl is investigating these issues.

The Research Group “Regulation of the Digital Economy” examines whether the existing IP system can fulfil its fundamental functions in the context of AI. Since a sound understanding of technology is indispensable for this task, the members of the group researched technical literature, conducted interviews with practitioners and organized a workshop with international AI researchers. The result is the present paper "Technical Aspects of Artificial Intelligence: An Understanding from an Intellectual Property Law Perspective".

The paper forms the basis for the group's ongoing legal research: How do current IP rights apply to AI? To what extent should the existing IP system be adjusted to adequately reflect social and economic changes due to AI?

With the European Patent Office (EPO), Federal Patent Court (BPatG), German Patent and Trademark Office (DPMA), institutions of the new Unified Patent Court (UPC), the Patent Attorney Chamber, numerous lawyers and patent attorneys, patent services as well as many innovative Bavarian companies with large patent portfolios, Munich applies as the “European Patent Capital”.

The regional court Munich I is one of only 12 German courts responsible for so-called patent matters, in particular patent infringement cases. As a rule, the plaintiff has the choice of which court to call. The regional court Munich I is third in terms of the number of entries behind Düsseldorf and Mannheim. An important factor for the patent location Munich is the “Münchner Verfahren” (Munich Proceedings in Patent Litigation).

Ten years after its introduction, the procedure is now to be evaluated in order to gain knowledge for future improvements. The scientific evaluation is carried out by the Max Planck Institute for Innovation and Competition as part of a research project.

As soon as the results are available, we will report.

For this purpose, a sample of more than 250,000 digitally performable projects from 188 countries with more than 2.5 million wage bill proposals of 65,010 freelancers from 177 countries was analyzed.

Female freelancers are willing to complete projects at a lower wage than their male competitors – which largely explains the observed gender wage gap. However, the analysis also shows that female freelancers are more likely than their male competitors to win the competition for contracts. Overall, this leads to a higher expected wage for female freelancers when making wage bill proposals.

One possible implication of the new Max Planck study by Frank Mueller-Langer, Affiliated Research Fellow at the Institute, and his co-author Estrella Gómez-Herrera, Joint Research Centre of the European Commission, is that online labor markets could help female workers to obtain a higher expected income.

See Publication