The China National Intellectual Property Administration (CNIPA) published its Revised Draft Provisions Concerning Regulating Patent Application Behavior (Draft for Public Comment) (关于规范申请专利行为的若干规定修改草案[征求意见稿]) on May 6, 2021 (the “Draft Provisions”). The purpose of this draft is to address “abnormal” applications characterized by multiple applications with very similar or identical content. These rules are part of an effort to increase the influence of “good faith” obligations in IP prosecution, and improve overall patent quality. Improvements in patent quality have mostly notably included an end to CNIPA’s extensive subsidy program. IPO’s comments on the Draft Provisions are available here.
In IPO’s view, “abnormal application behavior” is primarily driven by those applicants seeking subsidies or other incentives. The Draft Provisions therefore should apply primarily to only those applicants who, at the time of application filing (such as in an Application Data Form), identify themselves as eligible for and intending to seek financial subsidies or related incentives in China based on the patent application. IPO also proposes that these rules be made to apply only to utility model and design patents (where applicable), which are not routinely subject to substantive examination upon filing. IPO also recommends that, in determining whether a patent application is “abnormal” and filed “for the purpose of seeking illegitimate interests or falsifying innovation performance or service performance,” CNIPA also take into consideration evidence (e.g., as provided by a challenging party) relating to breach of contract or breach of confidentiality in connection with a patent filing.
One issue that IPO does not discuss in great detail involves misappropriating confidential technology to file patent applications in China. Such applications may also use anonymous filing procedures to hide the identity of the inventor, and are not limited to utility model or design patents Although rare, there has been at one recent federal criminal case directed to misappropriation of proprietary technology for a patent application in China, where the record showed that one co-conspirator was advised to remove his name from the application (United States v. Shan Shi, (D. DC 2021). There has also been one US civil case where anonymous filing procedures were alleged to be used. The Magistrate Judge, Joel C. Hoppe, in his civil case report and recommendation in response to a 12(b)6 motion in Bonumose Biochem, LLC v. Yi Heng Percival Zhang et al (W.D. Va. 2018), described the situation as follows:
The Amended Complaint contains well-pled facts supporting a reasonable inference that Zhang used Bonumose’s proprietary information “to file the Tianjin [Institute] Application,” Am. Compl. ¶ 97, “by having himself listed as an anonymous co-inventor” on a patent application that “could not have been written” unless someone involved in that project either used a copy of “the confidential, unpublished provisional patent application” that Bonumose acquired from CFB in April 2016 or otherwise disclosed the “Tagatose Trade Secrets, the confidential or trade secret information underlying the Tagatose Invention,” id. ¶¶ 33–35. It also plausibly alleges that Zhang disclosed the Tagatose Trade Secrets to the Tianjin Institute after he promised not to do so. See id. ¶¶ 14–20, 32–25.
The defendant in the civil case, Percival Zhang was later convicted on criminal charges related to his research work. The on-line record in this case with respect to the patents is incomplete. The difficulties of tracing an anonymous applicant for the Chinese patents in this case were reported by National Public Radio.
In my view, anonymous patent filing practices should be limited or eliminated in order to improve “patent application behavior” by ensuring that patents are awarded to deserving inventors and not as a reward for trade secret theft. The anonymous filing procedures referenced in the Judge Hoppe’s report are set forth in Chinese Patent Examination Guidelines Sec. 4.1.2. Chinese patent agents are most likely to encounter the option to file anonymously when they complete CNIPA’s patent application form, Section 8, which is reproduced partially above, and includes a checkbox to mandate non-disclosure of the name of the applicant (不公布姓名). The instructions to this form also state that the applicant “can request that the name of the inventor not be disclosed by CNIPA” ( 3.本表第⑧栏发明人应当是个人。发明人可以请求国家知识产权局不公布其姓名).
IPO’s comments were submitted by IPO’s President, Daniel Staudt (Siemens Corp.), and prepared by its Asian Practice Committee, including Hsin Lin (Exxon Mobil Corp.), Kurtis Macferrin (Google Inc.), Edward Blocker (IPO Board Member Emeritus), Ying Dong (Shell Oil Company), Robert B. Furr, Jr. (Koch Industries Inc.), and Toby Mak (Tee & Howe Intellectual Property Attorneys).
Thank you IPO!
If you have corrections or further information or examples of anonymous patent filing cases, please send them along to me!