EPO - Exhaustion of Priority Right

In a decision published in June 2004 (Decision T0015/01), the Technical Board of Appeal revisited the doctrine of “exhaustion of property right” and disagreed with the earlier controversial 2003 decision of the Technical Board of Appeal which held that it was not allowable to claim priority from a first filing for more than one application in the same designated European Patent Convention state (European Union country) in respect of the same invention. This was thought to be the first application of the doctrine of “exhaustion of priority rights” by the examining or opposition divisions of the EPO or in the case law of the Boards of Appeal. In that case, Organogenesis Inc. appealed against a decision granting a patent to L’Oreal, a patent which claimed the same priority as a previous application had claimed. The appellant called into question the validity of the patent on grounds of novelty in view of a prior document, because, appellant contended, L’Oreal had exhausted the priority on the previous application. The Board agreed.

The “doctrine of exhaustion of priority” rights refers to the legal proposition that a priority right which has been claimed in a patent application is thereafter exhausted and cannot be claimed again in the same territory. Though some support for such a doctrine exists in the French national case law dating back to the 1960’s, and in the legal literature, clear reservations were expressed about the doctrine. The Guidelines for Examination in the EPO do not mention the issue at all in relation to priority. Decision T 998/99 acknowledged that the EPC is silent on the issue of whether or not the same priority for more than one application filed for the same state is possible, and that pursuant to Article 87(1) EPC, the priority right is enjoyed for the purpose of filing a European patent application in respect of the same invention. While susceptible to different interpretations, the Board in the T 998/99 decision felt obliged to consider which interpretation fit better into the priority system of the EPC as a whole. It stated that, while the convention provides for multiple and partial priorities (Article 88(2) and (3) respectively), it does not provide for claiming the same priority several times in respect of applications filed in one and the same country of the Union relating to the same invention.

Decision T0015/01 addressed the same issue. In this case, the Technical Board of Appeal disagreed with the view of T 998/99, and held that the priority system of the EPC does allow patent applicants to claim and enjoy the same priority right in more than one European application. In its Reasons (21 41), the Board stated that notwithstanding the doctrine’s applicability to serve to prevent double patenting, there are situations in which a practical need exists for allowing applications to claim the same priority right in more than one European patent application.

First, an applicant may split up the subject matter of the priority application in order to avoid a non unity objection. Application of the doctrine would result in losing the priority for the second subsequent application. In clear contrast to such a result is the divisional application of a prior European application, covered explicitly by Article 4G of the Paris Convention and Article 76(1) (second sentence), and which enjoys the benefit of both the filing date of the parent application and also the benefit of any right to priority. The Board saw no reason for not allowing the applicant to achieve the same result by immediately dividing the subject matter of the priority application between two separate European applications both claiming the priority right for the respective part of the subject matter.

Second, the patent applicant should be allowed to remedy any deficiency in his application that was realized before the expiry of the priority period by filing a second European application. Application of the doctrine would prevent such a means of redress.

Third, application of the doctrine would thwart innovation and the ability to file later applications covering newly found related subject matter. The patent system of the EPC encourages a filing strategy in which improvements and additional embodiments developed during the priority period may be filed in possibly several subsequent European applications, always claiming the priority of all the previous applications. The Board reasoned that if the EPC encourages such a “combination strategy” it would not make sense to then restrict it by application of the doctrine of exhaustion.

It is worth noting that in the case of Decision T0015/01, the Board considered the question of referral to this Enlarged Board of Appeals, but concluded that referral was not necessary for the purposes set out in Article 112 EPC since it was not known that the doctrine of exhaustion of priority rights has ever been applied or explicitly addressed in the first instance practice of the EPO, or, with the exception of decision T 998/99, in the case law of the Boards of Appeal. Under such circumstances, the Board decided that referral was for the time being not necessary (see Reason 40). This cautious language, however, leaves open the possibility of future revisiting of the issue, particularly as the perplexing Decision T 998/99 appears to have been sidestepped.