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Wednesday, 15 December 2010

SMEIA grabs the headlines -- but fails the "Merpel" test

If the IPKat ever had to do any lobbying, this is his dream lobby
First to send this link to the IPKat for his perusal was stalwart patent practitioner and early riser Ron Camp (Kilburn & Strode). The link leads to an article in The Telegraph which is unkindly and a little misleadingly entitled "Tech body: patents are 'useless'". It runs like this (with Kat comments in red):
"John Mitchell, of the SME [Small and Medium-sized Enterprise] Innovation Alliance (SMEIA), does not blame politicians of any particular stripe – "the voice of innovative small businesses has been ignored by Whitehall for the past 10 years", he says – but the 18-month-old organisation is currently attempting to engage with the Coalition. He sent an open letter to Business Secretary Vince Cable and Chancellor George Osborne on December 2, which contains its recommendations, including a public "patent defence fund" that would allow companies to protect their intellectual property (IP) through the courts, but was told the ministers wouldn't be able to meet him due to "enormous pressure" on their time. 
The primary problem that needs addressing, he says, is that UK small businesses cannot afford the legal costs of enforcing their IP. David Cameron announced a review of IP laws in November, but Mr Mitchell has little faith that it will deliver the changes required to allow the UK to support scalable technology firms. "It does not require another review of IP to establish this fact yet again [correct: the IPKat said much the same thing last week here], it requires immediate change." 
He says the principle of security for costs – which allows a defendant to ask that a claimant pay a sum into the court up front to cover costs if it loses – allows large companies to breach IP rights and then assemble an expensive legal team that a small company could not hope to pay for, forcing the abandonment of any legal attempt.[There's a reason for security for costs, which also acts to protect SMEs]

Any patent can be challenged by a lengthy and expensive court process, making them "practically unenforceable" for small companies, he adds. "The UK patent system allows infringers with deep pockets to copy innovations knowing a legal challenge is unlikely." [But we've got a slick new Patents County Court now, with rules that are aimed at redressing this -- and a judge who is prepared to make a success of it]
Mr Mitchell, who has mounted legal challenges related to alleged patent infringement for his own business, voice recognition company Allvoice Developments, against IBM and Microsoft in the United States, believes the public 'patent defence fund’ would be a better use of Government money than university innovation [If there is such a fund, its very existence might act as a deterrent to unmeritorious actions, but its scope and availability would have to be very carefully thought out]. “There is little link between British universities and innovation,” he claims, pointing to the 2008 Wellings report which found that £989.9m of innovation investment into universities returned just £56.3m. [Is 'innovation' only measured in terms of return on investment? How does this ratio compare with private sector investment in various sectors? Isn't most investment in innovation lost because the market determines its success on the basis of preferences in terms of price, performance etc?]
He adds that the SMEIA is now offering free membership to small businesses in the science and technology sectors in an effort to compete with Government-sponsored bodies and build its lobbying voice [The IPKat doesn't think SMEIA has a lobbying voice right now.  He might have missed it, but he couldn't find anything on its website to say how many members it currently has.  Merpel adds, SMEIA doesn't have much of a web presence either: a Google search for 'SMEIA' this morning produced just 11,300 hits, most of which were nothing to do with the organisation at all.  In contrast, if you search 'Merpel' you get 19,400 hits, most of which are for me.  A lobby group that has a lower online profile than a fictional feline intellectual property commentator, despite being in existence for 18 months, is the sort of organisation that government ministers are too busy to see because of the "enormous pressure" on their time]. 
A spokesperson for the Intellectual Property Office said: "The review will look at the cost and complexity of enforcing IP rights. It is expected to report in April next year.""
The IPKat will keep an eye on the SMEIA, despite the "enormous pressure" on his time.  SMEs do need a voice; they are small, disunited and mainly ill-resourced -- and their commitments make it difficult for them to take time off to go around lobbying.  Merpel says, SMEIA may have a problem making its voice heard above the Confederation of British Industry (CBI), which also claims to speak for SMEs, and indeed BBCs [B***** Big Corporations] too.

Earlier IPKat post on the SMEIA here

6 comments:

Anonymous said...

Why don't you post your comments on the Telegraph website?

I’m a patent attorney. UK SME's are massively deterred from seeking patent protection in the UK because the costs of litigation are prohibitive. It's extremely disingenuous to say that the security for costs cuts both ways. The BBCs know that a small turnover SME can’t easily stump up £100K to take action. Some BBCs abuse the UK litigation system simply because of the costs issue. I have plenty of examples of SMEs that required nerves of steel to defend a spurious threat of patent infringement instigated by a Big Co. Security as to costs was not the problem; they still had to pay their lawyers and patent agents up front. Even though it was 95% certain they would win the ongoing costs could not be handled and many give in. Happily I have one with nerves of steel and the money who is now the exclusive supplier to the key players in UK market (because his kit is the best by a mile) despite the appalling abuse of the IP system by a Big Co.

I wish SMEIA the best of luck; they will need it!

Jeremy said...

@Anonymous

I post my comments on my weblog rather than on the Telegraph website since I this blog has been discussing issues of this nature for a long time and it is a useful reference point for readers wanting information on the subject.

As for the rest, we can debate this for ever. The vast majority of patent applications never come close to being a litigated patent, and I don't know how anyone can weigh the chilling effect of possible expected litigation against the demands of prospective licensees etc that key elements of an innovation be patented.

We clearly agree that too much is spent on patent litigation and the revamping of the Patents County Court seems to be at least a small, sensible step in the right direction. With firmer and more focused case management from the judges and with some hitting of heads together (is it really never feasible for the parties to share the same expert?) we can make some real improvements.

amafundi said...

This bears all the hallmarks of a smeia campaign...

Anonymous said...

It seems a trifle odd for the SMEIA to blast the poor (by their estimation) return on innovation investment in universities, when it is those very universities which provide the training for the very scientists, engineers, technicians, designers etc who eventually find employment in our SMEs. But then I never did really understand the subject-matter of dismal scientists.

Please excuse my ignorance, but are there provisions to make arbitration or ADR of any form compulsory for David v Goliath cases? Might that enforce a degree of equality of arms, and leave the adversarial stuff (and costs!) to cases in which rights have intentionally been breached? Or is this perhaps within the power of the Patents County Court?

Anonymous said...

Well, I've just Googled the SMEIA and I ended up here.

Merpel said...

@Anonymous - well of course you've got there now, silly! Getting on for three months after the IPKat posted on the SMEIA and his hordes of readers all set off in pursuit of the SMEIA, its Google-ability was bound to rise!

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