Analysis of G 1/22 and G 2/22

Rechtsprechung | 01.11.2023

G1/22 and G2/22: The EPO's Enlarged Board of Appeal decision on the entitlement to priority

The decision of the Enlarged Board of Appeal (EBA) in the cases G1/22 and G2/22 concerns the right to claim priority from an earlier application under Art. 87(1) EPC. It specifically addresses the aspect of who is entitled to claim priority for its subsequent application, i.e. it regards the so-called “formal priority”. 

The decision is a remarkable reversal of the previous EPO case law. According to the EBA, the applicant is presumed to be entitled to claim priority, shifting the burden of proof to the party challenging the validity of the priority claim (the “Challenger”). Although this presumption is rebuttable, it is a strong presumption so the Challenger must demonstrate that specific facts raise serious doubts as to the applicant’s entitlement to priority. The EBA also held that the priority right, and any related assignments thereof, are subject only to the autonomous law of the EPC and not any national law. As the EPC does not contain any provisions on assignments of priority rights, this means that the lowest standards established by any national law are to be applied and that informal or tacit assignments of priority rights are to be accepted by the EPO in almost all circumstances.

As the EBA also emphasizes, national courts and the UPC are not bound by the EPO’s decision. These courts are operating under more comprehensive statutory provisions, for example conflict of laws rules, which may prevent them from following the EPO in all aspects of the decision. Challenges to the formal priority may therefore in the future have more chances of success in national nullity or revocation actions. Despite the EBA decision, it therefore remains best practice to properly document any transfer of priority right before filing the subsequent application.

Background

The right to claim priority for a European patent application is set forth in Articles 87 to 89 EPC. Art. 87(1) EPC reads:

Any person who has duly filed […] an application for a patent, a utility model or a utility certificate, or his successor in title, shall enjoy, for the purpose of filing a European patent application in respect of the same invention, a right of priority during a period of twelve months from the date of filing of the first application. (emphasis added)

It follows from this provision that the right to claim priority belongs to the “person who has duly filed” the priority application, unless it has been transferred to a “successor in title”. Thus, one of the conditions for a valid claim of priority is that the applicant of the subsequent application is the person to whom the priority right belongs, i.e. that this person is entitled to claim priority for the subsequent application.

While, in the first few decades of the EPO, the entitlement to priority was rarely challenged in EPO proceedings, in the last decade or so it has become common practice to contest formal priority in opposition proceedings, at least where the applicant(s) of the opposed patent were not also the applicant(s) of the priority application. Since the burden of proof was generally held to be on the patentees, for the opponents it was sufficient to point out the difference in applicants. Then patentees had to prove that the priority right was acquired prior to the filing of the subsequent application. Since information about such transfers was usually entirely in the hands of the patentees, the standard of proof was mostly held to be the very strict "beyond reasonable doubt" standard. Patentees faced a very high threshold which could usually only be overcome by contemporary written evidence.

Many of these cases originate from priority applications filed in the U.S., mostly preceding the America Invents Act (AIA) when U.S. patent applications had to be filed by the inventors. This often resulted in a situation where a priority application was filed in the name of employee inventors, and where the subsequent PCT application named the employee inventors as applicants for the U.S. only and the employer as applicant for all other designated states. This scenario is referred to herein as “PCT joint applicants” scenario.

Where the entitlement to priority was decisive for the outcome of the case, the Opposition Divisions and Boards of Appeal therefore pored over assignments, other contemporary documents and expert opinions on national law, and revoked patents when the proprietor could not sufficiently demonstrate to have acquired the priority right prior to the filing of the application underlying the patent in dispute. One of the most high-profile cases was the Broad Institute’s CRISPR-Cas patent (T 844/18), which was revoked by the Board of Appeal without referring questions to the EBA.

Eventually, Technical Board of Appeal 3.3.04 referred questions in this respect to the EBA in cases T 1513/17 and T 2719/19, in consolidated proceedings. These questions were:

I. Does the EPC confer jurisdiction on the EPO to determine whether a party validly claims to be a successor in title as referred to in Article 87(1)(b) EPC?

II. If question I is answered in the affirmative:

Can a party B validly rely on the priority right claimed in a PCT-application for the purpose of claiming priority rights under Article 87(1) EPC in the case where

1) a PCT-application designates party A as applicant for the US only and party B as applicant for other designated States including regional European patent protection and
2) the PCT-application claims priority from an earlier patent application that designates party A as the applicant and
3) the priority claimed in the PCT-application is in compliance with Article 4 of the Paris Convention?

The EBA decision

On October 10, 2023, the EBA answered the referred questions in its decision in G 1/22 and G2/22.

As regards the first question, i.e. the competence of the EPO to assess the entitlement to claim priority under Art. 87(1) EPC (“formal priority”), the EBA agreed with the position of the referring Board of Appeal and held that the EPO must assess whether the applicant(s) were entitled to claim priority.

At the same time, however, the EBA – quite creatively – introduces a novel legal concept, the rebuttable presumption of priority. According thereto, the applicant claiming priority is presumed to be entitled to claim priority, which shifts the burden of proof to the Challenger. As will be addressed below, the details of this presumption and its legal basis make it very difficult for a Challenger to rebut this presumption.

The EBA provides a similarly nuanced answer to the second question, namely whether applicants for the territory of the EPC in a PCT application are entitled to claim priority if the PCT application is filed jointly with the applicant(s) of the priority application whereby the latter are only applicants in the PCT application for a territory other than the territory of European regional patent protection (“PCT joint applicants approach”). The EBA appears not convinced that in such a situation the applicant for the EPC territory could be deemed to be entitled to the priority right, i.e. without requiring any transfer of the priority right, but it does not provide a definitive answer to this legal question. According to the EBA, the rebuttable presumption in most cases should lead to the same result since the joint filing of the PCT application implies an agreement between the co-applicants, unless there are substantial factual indications to the contrary.

The EBA decision renders inapplicable a quite extensive body of case law and prior practice by the EPO’s Opposition Divisions and Boards of Appeal. It completely reverses the positions and chances of success of patentee and opponent when challenging priority. We expect that the routine challenges of formal priority in EPO proceedings will come to an end and that such cases will become as rare as in the first years of the EPO, if not rarer. The EBA itself also expects its decision to have such a dampening effect:

The rebuttable presumption concerning priority entitlement […] substantially limits the possibility of third parties, including opponents, to successfully challenge priority entitlement.
(Reason 117; emphasis added)

To be clear, this decision by the highest judicial body of the EPO is not binding on national courts or the Unified Patent Court (UPC), although the decision, which is well-reasoned, may be persuasive. Therefore, it remains best practice to properly document any transfer of priority right before filing the subsequent application.

It should also be noted that this decision will not always favor patentees. Where the opponent relies on an Art. 54(3) EPC document for a novelty attack and if the Art. 54(3) EPC status of the document depends on its priority being valid, the rebuttable presumption of validity of the formal priority also applies. In such cases it will be the patentee who must provide specific facts supporting serious doubts as to the validity of the priority claimed in the prior art patent document.

The priority as a right under the autonomous law of the EPC

As part of its reasoning, the EBA also categorizes the priority right as an autonomous right under the EPC which is not subject to any national laws. Since the EPC does not contain any conflict of laws rules, in the past, it was intensely debated which national laws govern the transfer of a priority right. The EBA has put an end to these debates. Because the priority right is held to be an autonomous right under the EPC, the priority right and any transfer of this right are only to be assessed under the EPC, according to the EBA. The application of national laws for assessing the validity of a (purported) transfer of a priority right is thus excluded.

Given that the EPC also does not contain any property or contract law provisions for the transfer of priority rights and does not impose any requirements for such transfers, the EBA concludes:

[…] the EPO should adapt itself to the lowest standards established under national laws and accept informal or tacit transfers of priority rights under almost any circumstances. 
(Reasons 99, emphasis added).

While it will have to be awaited how the decision is implemented in practice by the Opposition Divisions and Boards of Appeal, it is very likely that arguments such as that a transfer is not in writing, not signed by both parties, that the priority right is not explicitly mentioned in an assignment, or that it is not a present assignment but a mere undertaking to assign, will not prevail in opposition proceedings anymore. The transfer will likely be deemed to have taken place by informal or tacit assignments “under almost any circumstances”, as the EBA writes. 

The EBA even slightly opens the door to retroactive assignments, albeit in an obiter remark only. Thus, in the rare cases where this may be necessary, a retroactive assignment may be attempted. 

The only aspect where the EBA sees limited room for national law to apply relating to a priority right is regarding “the existence of legal entities being parties in transfers of priority rights”.

Note, however, that these points expressly do not apply to the right to a European patent. The EBA emphasizes and confirms the distinction between a right to a European patent and a priority right. While the right to a European patent originates in the inventor, the right to priority originates in the person filing the priority application. And, most importantly, the right to the subsequent patent remains subject to national laws and will continue to be assessed by national courts (Articles 60 and 61 EPC).

The effects and justification of the rebuttable presumption

The rebuttable presumption that an applicant is entitled to claim priority (formal priority) firstly reverses the burden of proof. The burden is now on the Challenger. In addition, the EBA considers it to be a "strong presumption," meaning that the Challenger must provide specific facts that raise serious doubts as to the subsequent applicant's entitlement to priority. Mere speculation is not sufficient. The bar for rebutting this presumption is therefore set very high:

The presumption should be rebuttable since in rare exceptional cases the priority applicant may have legitimate reasons not to allow the subsequent applicant to rely on the priority. Such circumstances could, for example, be related to bad faith behaviour on the side of the subsequent applicant or to the outcome of other proceedings such as litigation before national courts about the title to the subsequent application.
(Reasons 108, emphasis added)

As justification for the rebuttable presumption the EBA considers mainly: (i) the absence of formal requirements for the transfer of the right (which follows from the categorization as an autonomous right under the EPC), (ii) a balancing of the respective interests and, most importantly, (iii) the cooperation between the applicant of the priority application and the applicant of the subsequent application, which almost always is factually indispensable.

Regarding (ii), the EBA confirms an earlier decision of the Board of Appeal (T 15/01), which had already underlined the purpose of the priority right, namely to facilitate international patent protection. Inventors and their successors in title accordingly have a legitimate expectation that their international patent protection should not be jeopardized by inadvertently failing to comply with not objectively justified formal requirements. In the EBA's view, the general public's interest in legal certainty is also served, as the rebuttable presumption means that the right to priority can generally be relied upon, unless there are specific reasons that give rise to serious doubts. And while opponents may have an interest in challenging a lack of priority entitlement, the EBA notes that under the EPC third parties can never fully rely on the invalidity of the priority right. To illustrate this point, the EBA refers to the situation where a third person is entitled to the patent. Such a person can file their own patent application which under the EPC is deemed entitled to the priority of the application filed by the “wrong applicant” (Articles 61(1) and 76(1) EPC).

A central consideration in the EBA decision is (iii), the necessary collaboration of the applicant of the priority application. To be able to claim priority from an earlier application, usually the extensive and timely cooperation of the applicant of the priority application is required. A priority application is usually not published or otherwise made available to third parties before the expiry of the 12-month period for claiming priority in the subsequent application, and the applicant of the subsequent application must file a copy of the priority application certified as correct by the authority where the priority application was filed (Rule 53(1) EPC, Article 4D(1) Paris Convention). The EBA therefore held that the act of claiming priority itself already constitutes strong factual evidence of the priority applicant’s consent to the claim of priority by the subsequent applicant.

It follows from this consideration and the further explanations in the decision that a key to successfully challenging formal priority in the future will likely be to present specific facts which disprove that the right holder of the priority right must have cooperated with the applicant of the subsequent application, and thus implicitly agreed to a transfer of the priority right.

The rebuttable presumption is limited to the entitlement aspect of priority. For example, the applicant must still ensure they fulfill all procedural requirements for claiming priority under Article 88(1) EPC.

The PCT joint applicant approach

Regarding the PCT joint applicants approach, as described above, the EBA considered the joint filing of the PCT application as sufficient evidence of an implied, tacit agreement conferring the right to benefit from the priority for the EPC territory, absent substantial factual indications to the contrary. The EBA also noted that this does not eliminate the “all applicants approach”, i.e. the requirement that all applicants of the priority application must either be co-applicants of the subsequent application, or must have transferred their priority right, but notes that the rebuttable presumption also applies in this case.

Consequences in practice

For patentees:

• the risk of losing the priority on formal grounds in EPO opposition proceedings is now significantly reduced;
• the opponent must raise substantial doubts which can overcome the strong presumption, in particular against the expectation that the initial holder of the priority right has consented to the filing of the subsequent application; and
• in the unlikely scenario that an opponent presents “specific facts [which] support serious doubts about the subsequent applicant’s entitlement to priority”, the patentee should consider submitting additional evidence (e.g., declarations) confirming the existence of the (tacit) consent and/or, as a last resort, aim to obtain a retroactive assignment.

For opponents:

• conversely, challenging the formal right to priority of the patentee will require arguments that go beyond mere speculation or lack of formalities, so that only challenging the (tacit) consent by the priority right holder appears to have a significant chance of success; and
• where the opponent relies on an Art. 54(3) EPC document for a novelty attack and if the Art. 54(3) EPC status of the document depends on its priority being valid, the rebuttable presumption of validity of the formal priority will also apply, meaning that it will be up to the patentee to raise specific facts supporting serious doubts about the validity of the priority claimed in the prior art patent document.

 

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