1 PATENT ENFORCEMENT
1.1 Before what tribunals can a patent be enforced against an infringer? Is there a choice between tribunals and what would influence a claimant's choice?
As a rule of thumb, enforcement is a matter of state jurisdiction. Each Brazilian state has a state court system and, therefore, infringement lawsuits can be filed before any state court, provided that other rules of civil procedure are observed. As a general rule, infringement lawsuits must be filed in the state where the accused infringer has its principal place of business or in any place where acts of infringement occurred.
1.2 What has to be done to commence proceedings, what court fees have to be paid and how long does it generally take for proceedings to reach trial from commencement?
An infringement lawsuit starts with the filing of an initial brief, where plaintiffs must assert their claims of infringement alleging that the accused product infringes a patent. Normally, the burden of the proof falls on the plaintiff (except in the case of infringement of a process patent), who often presents documentary evidence upfront, including technical and legal options. After the defendant is duly served of the complaint, he normally has 15 days to file an answer, where all possible defences, including counterclaims of invalidity, shall be presented together with the supporting evidence. In an infringement case, both parties may request the court to allow the submission of further evidence during the proceeding; most importantly, the production of technical evidence by an expert to be appointed by the court at a later stage. The plaintiff then has a 10-day term to file a reply brief, before the judge decides on the requests made by each party regarding production of evidence. At this stage, the court may also identify issues that are not under dispute and decide any preliminary argument raised by the parties. If the production of technical evidence is required, the judge will then appoint a court expert to prepare a technical report that will be used to assist the court. Parties may elect their own experts to interface with the court-appointed expert and provide any clarification which he may need. Parties may also submit technical questions to be answered by the court expert relating to infringement and validity. After the court-appointed expert files his report with the court, and parties submit their own arguments in relation to such report, the judge will then set a date for closing arguments (written) and a date for trial. If no oral evidence is needed, the court may also render a final judgment without a trial. The pre-trial stage may take an average time limit of eight months. In cases where any party contests the court-appointed expert's nomination, and depending on the complexity of the case, this schedule may be substantially delayed.
Costs are generally borne by the losing party, in accordance with Article 20 of the Brazilian Civil Procedure Code. The court may award loss of suit costs covering court fees and the expenses incurred by the prevailing party, as well as the fees of expert witnesses and other related costs of the proceedings. The award may also include an amount covering loss of suit attorney fees, stipulated by the court. Loss of suit attorney fees is normally fixed at 10–20% of the overall award of damages (if any) as per Article 20, item 3 of the Civil Procedure Code. Note that the award of loss of suit attorney fees by the court is independent of the fee agreement reached between the parties and their attorneys; in other words, the prevailing party may still need to pay attorney fees even when the court makes an order for loss of suit fees in favour of his attorney.
1.3 Can a party be compelled to disclose relevant documents or materials to its adversary either before or after commencing proceedings, and if so, how?
Under Brazilian procedural law, there is no general obligation for a party to list or disclose documents, but the parties will usually submit documents which they consider relevant to support their own case. Documents are filed at court, but not served on the other side.
The plaintiff is required to attach to the brief or complaint the documents which support his case, and to allow for further evidence which he intends to adduce in the proceedings. The defendant then does the same when filing the defence, challenging the plaintiff's arguments and evidence.
1.4 What are the steps each party must take pre-trial? Is any technical evidence produced, and if so, how?
Each side submits its written arguments and documentary evidence. Parties may submit almost any kind of evidence before trial, from prior art references to technical and legal opinions. Technical experts are frequently used in patent litigation. Most of the attorneys have no technical background in Brazil. This is because technical experts are key players in infringement and validity litigation. The judge, however, may also appoint a court expert whenever the facts under discussion depend on technical or scientific knowledge, which is virtually the case in all infringement and validity lawsuits. Likewise, plaintiffs and defendants may also appoint technical assistants so as to provide guidance to the court-appointed expert, and to respond to his technical conclusions.
In patent litigation, where almost every case involves technical issues, an outcome on merit will often depend on the knowledge of an expert, or sometimes several experts. It is important to note, however, that the judge has the right to decide notwithstanding the conclusions of the court-appointed expert. In other words, the court expert's report is not binding on the court's ruling.
1.5 How are arguments and evidence presented at the trial? Can a party change its pleaded arguments before and/or at trial?
Ideally, when the trial is set, the court records are already completed, and the parties and the judge have read the briefs. During trial, the parties' attorneys, their experts or witnesses will present evidence mostly orally. Each party may call up to 10 persons to testify, among witnesses and experts, but the judge may limit this number to a maximum of three for each side. The judge will question the witnesses separately and successively, starting with the plaintiff's. The party's representatives may also be called to put forward their evidence. The judge puts forward all questions and the parties may address the court with additional questions, besides the ones being made.
According to Article 264 of the Civil Procedure Code, a plaintiff cannot change his pleadings or causes of action (arguments) once the defendant is served with the complaint, unless the defendant consents. The plaintiff cannot, under any circumstances, change his pleadings or causes of action after the judge renders a decision defining the issues in the case and the scope of the evidence production phase.
1.6 How long does the trial generally last and how long is it before a judgment is made available?
Trials generally take one day, but sometimes take longer depending on the complexity of the case and on the number of experts and witnesses called by each party. After trial, the judge is expected to make a judgment in 30 days. This deadline, however, is rarely met by the judge, who may take months to render a final decision, especially in cases involving a greater level of complexity.
1.7 Are there specialist judges or hearing officers, and if so, do they have a technical background?
Specialist judges are not yet available. However, specialised IP courts have been created in recent years. In 2002, the Rio de Janeiro Federal Courts made some advances, creating four district courts (out of 47) with special jurisdiction to hear cases filed against the Brazilian Patent and Trademark Office (BPTO). These are still the only federal district courts specialised in IP matters in the country. At the appellate level, however, there have been developments. The Federal Court of Appeals for the Second Circuit, which has jurisdiction to decide appeals from Rio de Janeiro and Espirito Santo, for example, has two chambers (out of eight) specialised in IP cases. The Federal Court of Appeals for the First Circuit, with jurisdiction to decide appeals from the Federal District (Brasília) and 13 other Brazilian states, also has two chambers with jurisdiction to hear IP cases. Furthermore, the Federal Court of Appeals for the Third Circuit, with jurisdiction in São Paulo and Mato Grosso do Sul, also has specialised IP chambers (three out of 10).
At state level, all major Brazilian cities have courts specialised in commercial and corporate law, including IP. For instance, the Rio de Janeiro state court has seven state courts with jurisdiction to hear commercial law cases, including IP cases.
1.8 What interest must a party have to bring (i) infringement, (ii) revocation, and (iii) declaratory proceedings?
Infringement lawsuits must be filed by the patent owner or by its exclusive licensee vested with powers, against anyone who may be infringing the patent. As to revocation and declaratory proceedings, the law provides that "any legitimate interested party" may file them (Article 56 of the Patent Law). This requirement is interpreted by courts very broadly; sometimes, it suffices to be a competitor or to work in the same field of technology.
1.9 If declarations are available, can they address (i) non-infringement, and/or (ii) claim coverage over a technical standard or hypothetical activity?
Yes. As long as there is uncertainty over a fact, and this uncertainty is causing an actual or imminent threat to the party's right, a court may be requested to entertain a declaratory judgment, either affirmative or negative.
1.10 Can a party be liable for infringement as a secondary (as opposed to primary) infringer? Can a party infringe by supplying part of, but not all of, the infringing product or process?
Yes, a party can be held liable for contributory infringement or inducement. The Patent Law further provides that supplying a component of a patented product, or material or equipment for carrying out a patented process, provided that the final application of the component, material or equipment necessarily leads to the exploitation of the subject matter of the patent, is considered a crime of unfair competition.
1.11 Can a party be liable for infringement of a process patent by importing the product when the process is carried on outside the jurisdiction?
Yes. According to Article 42 of the Patent Law, a patent confers on its owner the right to prevent third parties from manufacturing, using, offering for sale, selling or importing for such purposes, without his consent, a process, or product directly obtained by a patented process. In addition, in the case of a process patent, the defendant has the burden to prove non-infringement, while in a product patent the burden of proof lies with the plaintiff.
1.12 Does the scope of protection of a patent claim extend to non-literal equivalents?
Yes. It is possible to establish direct infringement by the doctrine of equivalence. The Patent Law expressly provides that the patent infringement may be found "even if the violation does not affect all the claims of the patent or if it is restricted to the use of means equivalent to the subject matter of the patent".
1.13 Can a defence of patent invalidity be raised, and if so, how? Are there restrictions on such a defence e.g. where there is a pending opposition?
Yes. Invalidity may be raised as a defence in any infringement lawsuit. Defendants often use this kind of defence argument, combined with a non-infringement argument, in their response brief. However, it may be raised at any time during the proceedings.
In order to revoke a patent with erga omnes effect, as from its filing date, a declaratory lawsuit of invalidity must be filed. In this kind of lawsuit, the BPTO is a mandatory defendant, together with the patentee, and because the BPTO is a federal entity, the invalidity proceeding must be filed at the Federal Court in Rio de Janeiro.
Note, however, that the defence referred to would be an infringer's reply to an infringement lawsuit. Accordingly, we are referring to a defence raised in an infringement proceeding at the state courts. A spontaneous invalidity lawsuit will have to brought at the Federal Courts, as the BPTO is a federal entity, and consequently a mandatory co-defendant. Post-grant (administrative) oppositions, ex officio or at the request of third parties with legitimate interest, can only be filed within six months from the patent grant at the BPTO.
1.14 Other than lack of novelty and inventive step, what are the grounds for invalidity of a patent?
In general terms, a patent may be invalidated whenever it is in violation of any provision of the Patent Law. Besides lack of novelty and inventive step, the most common grounds for invalidity are the following: (i) lack of enablement (Article 24, "[t]he specification must describe the subject matter clearly and sufficiently so as to enable a person skilled in the art to carry it out and to indicate, when applicable, the best mode of execution"); and (ii) lack of support in the specifications (Article 25, "[t]he claims must be based on the specification, characterizing the particulars of the application and defining clearly and precisely the subject matter to be protected").
1.15 Are infringement proceedings stayed pending resolution of validity in another court or the Patent Office?
As a general rule, yes. However, if the validity challenge is raised when the infringement case is already in a later stage, the court may reject such kind of request.
1.16 What other grounds of defence can be raised in addition to non-infringement or invalidity?
The law guarantees protection to the person who, in good faith, has been exploiting the patented product or process prior to the date of filing or of priority of a patent application. The "prior user" has the right to continue the exploitation, without onus, in the previous form and under previous conditions (Article 45 of the Patent Law).
In addition, although rarely, the laches doctrine in patent infringement lawsuits may be raised and accepted if the court is convinced that the patent owner knew about the infringing activities but delayed substantially to file the lawsuit, so as to increase potential damages.
1.17 Are (i) preliminary, and (ii) final injunctions available, and if so, on what basis in each case? Is there a requirement for a bond?
Yes, both kinds of injunctions are available. Preliminary injunctions may be granted as long as substantive evidence is submitted, and the court is convinced of (i) the likelihood of success on the merits, and (ii) the need for an urgent decision from courts to avoid irreparable harm. In granting a preliminary injunction, courts will balance the hardships and the effect of not doing so in cases where the injunction effects are irreversible. In order to avoid irreparable damages or damages that would be difficult to recover, the judge can even grant an injunctive order to suspend the violation or act of infringement before summoning the defendant (ex parte), ordering the plaintiff to post a bond or a fiduciary guarantee in cases where he deems it necessary.
Permanent injunctions are also available, and are normally granted whenever a judgment of infringement is made, although a stay on the injunction may be determined by the Court of Appeals while the appeal is not decided by the court.
1.18 On what basis are damages or an account of profits assessed?
Under Article 210 of the Patent Law, loss of profits shall be determined by the most favourable of the following criteria: (i) the benefits that would have been gained by the injured party if the violation had not occurred; (ii) the benefits gained by the author of the violation of the rights; or (iii) the remuneration that the author of the violation would have paid to the proprietor of the violated rights for a granted licence which would have legally permitted him to exploit the subject of the rights (Article 210 of the Patent Law). It is possible to obtain compensation for acts of infringement which occurred between the date of publication of the application and that of the grant of the patent, or even before publication, if there is proof that the infringer has knowledge of the contents of application prior to publication (Article 44 of the Patent Law).
1.19 What other form of relief can be obtained for patent infringement? Would the tribunal consider granting cross-border relief?
In addition to damages, it is also possible to obtain search and seizure orders and other immediate reliefs, such as preliminary and permanent injunctions.
The tribunal would consider granting cross-border relief depending on the circumstances; for instance, shipment details, information on the importer, evidence that the incoming or imported product reproduces and/or infringes the patented product in Brazil. In the context of the patent, this is not a simple task for Custom Officials. A generic claim will not be sufficient to obtain relief.
1.20 How common is settlement of infringement proceedings prior to trial?
The Brazilian Civil Procedure Code (CPC) expressly provides for a conciliation hearing to encourage parties to reach an amicable settlement before the evidence phase and before the judgment in the infringement lawsuit. Besides this, parties may, at any time, establish negotiations for an amicable settlement, also requesting a conciliation hearing. Note, however, that the patent holder will prefer to send Cease and Desist letters to the infringing party to avoid litigation. Accordingly, a considerable number of patent infringement cases are settled via Cease and Desist letters.
1.21 After what period is a claim for patent infringement time-barred?
Although the Brazilian Civil Code provides for a general three-year statute of limitations for filing damages lawsuits, the Patent Law establishes a five-year statute of limitations for patent infringement.
1.22 Is there a right of appeal from a first instance judgment, and if so, is it a right to contest all aspects of the judgment?
Yes. Parties can appeal from the first instance judgment, and all aspects of the judgment may be reviewed by the Court of Appeals.
1.23 What are the typical costs of proceedings to first instance judgment on (i) infringement, and (ii) validity? How much of such costs are recoverable from the losing party?
Infringement or validity cases may cost from US$ 60,000 (sixty thousand dollars, in a very straightforward case) to over US$ 250,000 (two hundred and fifty thousand dollars) in more complex cases, especially when infringement and validity are dealt with in the same case.
1.24 For jurisdictions within the European Union: What steps are being taken in your jurisdiction towards ratifying the Agreement on a Unified Patent Court, implementing the Unitary Patent Regulation (EU Regulation No. 1257/2012) and preparing for the unitary patent package? For jurisdictions outside of the European Union: Are there any mutual recognition of judgments arrangements relating to patents, whether formal or informal, that apply in your jurisdiction?
No, not that we are aware of. The BPTO once considered harmonising patent examination proceedings amongst Latin American neighbouring countries, but this project has not materialised. At the moment, Brazil is more concerned with improving its IP system and reducing the backlog of patent cases.
2 PATENT AMENDMENT
2.1 Can a patent be amended ex parte after grant, and if so, how?
No. Amendments are not allowed after a patent grant. However, a patentee may apply for a certificate of addition to protect an improvement or development introduced in the subject matter of the invention.
2.2 Can a patent be amended in inter partes revocation/invalidity proceedings?
Yes, although it is very unusual. There was one case where a court determined amendments to be made in a patent claim. In such cases, the Letters Patent will be subsequently endorsed.
2.3 Are there any constraints upon the amendments that may be made?
Yes. According to Article 32 of the Patent Law, applicants may only amend their claims until the request for examination, and provided that the amendments are supported by the initial disclosure. The BPTO has recently issued new Guidelines for amending patent applications. Voluntary amendments for correcting translation or typing errors can be made after the examination request if the specification fully supports them. Other examples of post-examination voluntary amendments that may be accepted by the BPO are: I) inserting the context of a dependent claim into an independent one; II) restricting parameter range; or III) withdrawing an element originally presented as an alternative. The new Guidelines also indicate that elements originally included into an independent claim cannot be deleted, as this change could also imply that the scope of protection has been expanded.
The Guidelines on voluntary amendments will become an important source and reference point for Brazilian Examiners when performing substantive examination on patent applications.
3.1 Are there any laws which limit the terms upon which parties may agree a patent licence?
Yes. Licence agreements are subject to recordation in the BPTO in order to produce effects against third parties (Article 62 of the Patent Law) and whenever payment is remitted abroad. In the process of recording, the BPTO may provide limitations upon which parties may agree. The most critical limitation is on the consideration clause. The BPTO often issues office actions questioning payment methods whenever the licence agreement does not establish a "fixed amount per unit sold" or "a percentage on the net selling price". The BPTO also limits tax deductions in order to limit the remittance of payments among colligated companies. Furthermore, the BPTO does not permit any compensation for patent applications.
Another limitation provided by the law refers to improvements. Licence agreements executed in foreign countries often contain a clause providing that improvements belong to the licensor, even if made by the licensee. Nevertheless, the Brazilian Patent Law determines that any improvement on a licensed patent shall belong to the person who made it, thus guaranteeing the other party the right of preference with respect to a licence (Article 63 of the Patent Law).
If there is an antitrust concern, the BPTO often questions non-competition clauses when the period is greater than five years after the end of the licence, and limits the term of the licence by the respective patent term.
3.2 Can a patent be the subject of a compulsory licence, and if so, how are the terms settled and how common is this type of licence?
Yes. Patents may be subject to compulsory licence. There are several grounds for granting such licences, including in cases of abuse of patent rights or abuse of economic power, in cases of non-exploitation of the subject matter of the patent in the Brazilian territory, or in cases of a lack of manufacture or incomplete manufacture of the product. In these cases, the licence can only be requested by a party with a legitimate interest, and this has the technical and economic capacity to carry out the efficient exploitation of the subject matter of the patent that should be destined predominantly for the internal market. A compulsory licence, based on lack of local or incomplete manufacture, may only be requested after three (3) years of the grant of the patent.
Compulsory licences may also be declared by the Executive Power, independent of any request, in cases of national emergency or public interest, as long as the patentee or his licensee does not meet such necessity.
Compulsory licences will always be granted without exclusivity; sublicensing is not permitted.
Although there are numerous hypothetical situations when a compulsory licence may be granted, this kind of licence is rare. There was one case in 2007 where a compulsory licence was granted on a pharmaceutical patent on the grounds of public interest.
4 PATENT TERM EXTENSION
4.1 Can the term of a patent be extended, and if so, (i) on what grounds, and (ii) for how long?
As a general rule, no. However, there is a patent category, called the pipeline patent, that may be subject to term extension requests, based on extensions granted in the country where the first application was filed, essentially for the revalidation of patents granted abroad (Article 230, § 4 of the Patent Law).
Brazil has allowed pipeline patent applications to be filed for a period of one year since the enactment of the current Patent Law (Law No. 9,279 of May 15, 1996), for products obtained by chemical means or processes and food and chemical-pharmaceutical products, since this subject matter was not patentable under the previous law.
5 PATENT PROSECUTION AND OPPOSITION
5.1 Are all types of subject matter patentable, and if not, what types are excluded?
No. According to Article 10 of the Patent Law, the following are not patentable: "I. discoveries, scientific theories and mathematical methods; II. purely abstract concepts; III. schemes, plans, principles or methods for commerce, accounting, financing, education, advertising, lottery and control; IV. literary, architectural, artistic and scientific works, or any aesthetic creation; V. computer programs per se; VI. presentation of information; VII. rules of a game; VIII. operating or surgical techniques and methods, as well as therapeutic or diagnostic methods for the treatment of humans or animals; and IX. the whole or part of natural living beings and biological material found in nature or also isolated therefrom, including the genome or germplasm of any natural living being and the natural biological processes."
In addition, Article 18 also provides that the following are not patentable: "I. that which is contrary to [accepted principles of] morality and good conduct and to public safety, order and health; II. substances, matter, mixtures, elements or products of any kind, as well as any modification of their physical-chemical properties and the respective processes of obtaining or modifying them, when they result from the transformation of the atomic nucleus; and III. the whole or part of living beings, except transgenic microorganisms which meet the three requirements for patentability – novelty, inventive step and industrial application – specified in Article 8 and which are not mere discoveries."
5.2 Is there a duty to the Patent Office to disclose prejudicial prior disclosures or documents? If so, what are the consequences of failure to comply with the duty?
No, there is not.
5.3 May the grant of a patent by the Patent Office be opposed by a third party, and if so, when can this be done?
The grant of issue of the patent can be challenged by a third party within six months from said grant or issue date. These are known as administrative nullification proceedings or post-grant proceedings. Before the actual grant of the patent, third parties may file observations in the application. Said observations can be submitted from the publication of the application up to the conclusion of the examination (pre-grant "opposition").
5.4 Is there a right of appeal from a decision of the Patent Office, and if so, to whom?
A decision rendered by the Patent Examiner granting, rejecting or shelving the patent application may be appealed to the President of the BPTO. The final decision rendered by the BPTO may be appealed to the Federal Courts in Rio de Janeiro, considering that the BPTO headquarters are located in Rio de Janeiro.
5.5 How are disputes over entitlement to priority and ownership of the invention resolved?
Disputes over priority or ownership may be resolved by the BPTO or by courts, and, in any case, the BPTO's decisions are subject to judicial review. A priority claim must be proved by means of a suitable document of origin, containing the number, date, title, specification and, when they exist, claims and drawings, accompanied by a simple translation of the certificate of filing or equivalent document containing data identifying the application, the contents of which will be of the entire responsibility of the applicant. If two or more authors have independently devised the same invention or utility model, the right to obtain a patent will be assured to whoever proves the earliest filing, independently of the dates of invention or creation. The withdrawal of an earlier filing without producing any effects will give priority to the first later filing.
5.6 Is there a "grace period" in your jurisdiction, and if so, how long is it?
Yes, there is. The grace period is 12 months, and the disclosure of an invention or utility model shall not be considered state of the art if it occurs during the 12 months preceding the filing date or priority date of the patent application when made by: I) the inventor; II) the National Institute of Intellectual Property through the official publication of the patent application filed without the consent of the inventor based on the information obtained from him or resulting from his acts; or III) third parties, on the basis of information obtained directly or indirectly from the inventor.
5.7 What is the term of a patent?
The term of a patent of invention shall be twenty (20) years and that of a utility model patent shall be fifteen (15) years counted from the filing date of the application. This term shall be no fewer than ten (10) years for an invention patent, and seven (7) years for a utility model patent counted from the date of grant, except where the Instituto Nacional da Propriedade Industrial (INPI) is prevented from carrying out the substantive examination of the application, owing to a duly evidenced judicial dispute, or for reasons of force majeure.
6 BORDER CONTROL MEASURES
6.1 Is there any mechanism for seizing or preventing the importation of infringing products, and if so, how quickly are such measures resolved?
Yes. The Customs Authorities, ex officio or at the request of an interested party, may seize infringing products entering the Brazilian borders. Nevertheless, the interested party is generally required to file a criminal or civil lawsuit within 10 days, seeking injunction relief in order to keep the importation stayed, and eventually requesting the destruction of the goods. This kind of measure is more common (and simpler) in cases of trademark infringement.
7 ANTITRUST LAW AND INEQUITABLE CONDUCT
7.1 Can antitrust law be deployed to prevent relief for patent infringement being granted?
Yes, but this is very unusual in Brazil. During the past year, the BPTO and the antitrust authorities reached some agreements to facilitate tracking and monitoring patent cases, but there are still many uncertainties in terms of how this control will be implemented, what actions will be taken, and on what grounds they will be based.
7.2 What limitations are put on patent licensing due to antitrust law?
The answer to question 3.1 would be applicable here.
8 CURRENT DEVELOPMENTS
8.1 What have been the significant developments in relation to patents in the last year?
Brazil's New Biodiversity Law
On May 20, 2015, the Brazilian president Dilma Rousseff sanctioned the Biodiversity Law No. 13.123/15, which regulates the access to components of Brazilian genetic heritage, the protection and access to associated traditional knowledge, and the sharing of benefits for the preservation and sustained use of Brazilian biodiversity.
The main objective of the new law is to facilitate scientific research and economic exploitation involving access to samples of Brazilian genetic heritage. As a result, there is a great expectation that national and international companies, especially those in the pharmaceutical, agricultural and cosmetic fields, will be encouraged to develop new products containing active ingredients from Brazilian biodiversity. Some of the key changes brought by the new law are:
- new rules for access to Brazilian genetic heritage made by foreign companies;
- legal security for private companies investing resources in RD&I;
- a "Benefit Sharing Program", which supports communities that provide their traditional knowledge to the industry, and the "National Sharing Fund" to manage the financial resources received;
- adoption of the maximum share of 1% of the company's net revenue obtained by selling the final product resulting from the access to a component of Brazilian genetic heritage;
- a guarantee to free negotiation over the traditional knowledge and an additional 0.5% of the profit to the National Sharing Fund while the product is being sold;
- profit-sharing of 1% with the National Sharing Fund if the traditional knowledge is not identified; and
- exemption of small companies and suppliers from sharing their profit, since they have less productive capacity.
It is important to highlight that the companies and researchers will no longer need prior authorisation to start a research project involving an active ingredient from Brazilian biodiversity, but rather simple electronic registration. Based on the provisions of the new Biodiversity Law, an authorisation is only required if the company decides to commercialise a product developed from the results obtained in the research.
An Update on ANVISA's Examination
The National Sanitary Surveillance Agency (ANVISA) introduced a significant change in the pharmaceutical patent examination through publication of a new Resolution. Resolution RDC No. 21/2013 resulted in a new workflow for pharmaceutical patent applications. With the advent of the new workflow, pharmaceutical cases are sent directly to ANVISA for examination supposedly taking into consideration public health issues. ANVISA Examiners determine whether or not an application poses risks to public health, and this will result in either a grant or denial of "prior consent" in respect of the pharmaceutical applications. Those patent cases which receive "prior consent" will be returned to the BPTO for further prosecution.
In practical terms, the applicant receives an unfavourable opinion denying "prior consent" and has 90 days from receipt of said opinion to submit a reply. If the applicant fails or chooses not to submit a reply, ANVISA will deny "prior consent". All written opinions reporting the conclusion of ANVISA's analysis regarding "prior consent" (both granting and denial) are published in the Brazilian Official Gazette. If "prior consent" of an application is denied by ANVISA, the applicant can file an administrative appeal to the Appeal Board of ANVISA within 60 days of receipt of the opinion. In the event that the appeal is held to be unfounded, the denial of "prior consent" will be ratified by ANVISA. After ratification of the denial, the application will be sent back to the BPTO. At this point, the BPTO will essentially "shelve" the application for an unknown period of time. Presently, no patent application for which "prior consent" has been denied, under the current workflow, has been shelved by the BPTO.
The majority of Brazilian attorneys view the "shelving" of a patent application without substantive examination by the BPTO as a violation of the law and unconstitutional. The rationale is that on paying an examination fee to the Agency (BPTO), an applicant is entitled to have its application examined by the BPTO (which is specifically authorised under the Brazilian constitution to review patent applications).
In the event that an application is "shelved" by the BPTO, the applicant can file an administrative appeal. Administrative appeals filed at the BPTO are analysed by a Board of Examiners. If the appeal is rejected, the only available recourse available for the applicant is to file a lawsuit in a Brazilian Federal Court against ANVISA's intervention in the substantive examination of the pharmaceutical patent application and against the BPTO's refusal to examine the application.
Approximately 20 lawsuits have been filed against ANVISA in connection with its denial of "prior consent" under the previous workflow (where applications were first examined by the BPTO and then sent to ANVISA for examination based on public health issues). In the majority of these lawsuits, the court has reversed ANVISA's denial of "prior consent". In these cases, the court has held that ANVISA must limit its review of an applicant's patent application solely to health issues, meaning that if the BPTO approved a patent application directed to a pharmaceutical product of process, a patent should be granted.
Court decisions in favour of patentees have been issued in District Courts in Brasília. Some Courts issued preliminary injunctions ordering ANVISA to grant "prior approval" of patent applications on the grounds that ANVISA did not have the competence to conduct "patentability" examination.
A recent unexpected decision from the Federal District Court in Rio de Janeiro denied a preliminary injunction, and ruled that ANVISA is competent to examine a pharmaceutical patent application in terms of patentability requisites. In all likelihood, this decision will be used by ANVISA to assert its legitimacy to examine pharmaceutical patent applications, and patentees and Brazilian attorneys will have to be creative to overrule this decision.
At the close of 2015, the Brazilian Government and the US signed a Memorandum of Understanding for Patent Prosecution Highway (PPH) in respect of patent applications filed in the Oil and Gas technology. Since then, a Pilot Program has been enacted. Under this Pilot Program of the Patent Prosecution Highway (PPH), an applicant who receives a positive ruling on a patent claim(s) from either the Brazilian National Institute of Industrial Property (INPI) or the United States Patent and Trademark Office (USPTO) may request accelerated prosecution of corresponding claim(s) in the other office. The PPH allows the applicant to obtain a patentability decision in the office of later examination (OLE) more quickly. Furthermore, the PPH promotes patent application processing efficiency by allowing the Examiner in the OLE to reuse the search and examination results from the office of earlier examination, thereby reducing workload and duplication of effort.
8.2 Are there any significant developments expected in the next year?
In May 2016, Brazilian President Dilma Roussef was stripped of her duties on account of an impeachment process. The process has not been entirely completed, but Roussef is out of office until a final decision is rendered by the Brazilian Senate. There is a fair certainty that Roussef will not return to duties. In the meantime, an interim Government stepped in. The priorities of the new Government are many, and the focus is to restore credibility to Brazil and regain foreign investments. There are discussions to restructure the BPTO to become efficient, and this measure will obviously mean increasing the number of Examiners to reduce the backlog. It is not a simple task, but it is a necessity. There are interested parties in the private sector who are willing to invest in the restructuring of the BPTO. There are also discussions to expand the PPH tool to other technological areas, and also to other important jurisdictions such as Europe and Asia. In view of the imminent Olympics event in August 2016, the BPTO has taken measures to expedite industrial design registrations which will favour registration owners.
8.3 Are there any general practice or enforcement trends that have become apparent in your jurisdiction over the last year or so?
The BPTO has recently filed a large number of court actions aiming at the cancellation of several pharmaceutical and agrochemical patents before the Federal Court of Rio de Janeiro. Actually, all patents involved in such court actions are related to pharmaceutical and agrochemical products/processes that belong to the so-called MAIL BOX types (also called black box), i.e., they were filed between January 1, 1995, when the TRIPS Agreement came into force, and May 14, 1997, when the new Brazilian IP Law came into force.
It is important to highlight that the BPTO published on September 10 (one day before filing the court actions), a legal opinion from the Public Office of Attorneys defending that such patents (known as MAIL BOX types – filed between January 1, 1995 and May 14, 1997), must be granted with a 20-year term counted from the filing date (as provided by Article 40 of the Brazilian IP Law), and not with a 10-year term counted from its granting (Sole Paragraph of Article 40 of the Brazilian IP Law). The relevant provisions of the IP law are as follows:
Article 40 – The term of a patent of invention shall be twenty (20) years and that of a utility model patent shall be fifteen (15) years counted from the filing date of the application. Sole Paragraph – The term shall be no fewer than ten (10) years for a patent of invention and seven (7) years for a utility model patent counted from the date of the grant, except where the BPTO is prevented from carrying out the substantive examination of the application owing to a duly evidenced judicial dispute or for reasons of force majeure.
In view of the above, considering that all patents involved in these court actions were granted with a 10-year term from the granting, instead of the 20-year term from the filing date, the BPTO is arguing that they were granted in dissonance with the provisions of the Brazilian IP Law and, therefore, they should be cancelled by the Federal Court of Rio de Janeiro. Alternatively, based on Article 229 Sole Paragraph of Law No. 9279, the BPTO requests that the Federal Court recognise that the patents should not have been granted with the 10-year term, and so apply the 20-year term of protection counted from the filing date.
Six court actions were already decided by trial judges against the BPTO's claim, that is, maintaining the patents in force and reinforcing that their term of protection should be 10 years counted from the grant. These decisions are not binding, and the BPTO can, and will, appeal the first instance decisions.
The BPTO has since filed appeals against the first instance decisions, and the Judges at the Court of Appeals have taken the position that the MAIL BOX patents should have a term of 20 years counted from the filing date of the application. Patentees of these MAIL BOX cases can still pursue the matter at the Superior Court.
Moreover, Brazil has now enacted a new Civil Procedure Code (No. 13.105/2015) which regulates the proceedings of most civil lawsuits from family issues to contracts and intellectual property rights enforcement. The new Law, which came into force in March 2016 for all new and ongoing lawsuits, is focused on meeting the difficulties and challenges of modern litigation. The new Law intends to be less bureaucratic and provide fast and effective solutions to all kind of legal disputes in Brazil, reducing appeals, optimising preparatory actions (there is no longer any need to prove urgency), and encouraging settlement.
Originally published by Global Legal Group.
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