Friday, April 21, 2017

New JPO ADR Decides License Fee

It was reported by multiple media that the Japan Patent Office (JPO) will present an amendment of patent law to the Diet in 2018 for creating JPO alternative dispute resolution (ADR) system.

In this JPO ADR system, it is expected that an arbitrator who is an expert selected by the JPO presents an appropriate license fee, payment method etc., and the arbitrator makes a legally binding ruling. Details of the system will be further discussed.

The purpose of the JPO ADR system is to prevent patent trolls from bringing an unreasonable action and to reduce damage of production companies from patent trolls. Another purpose is to solve disputes between large companies and SMEs, where an arbitrator is supposed to assist SMEs. Many Japanese tend to support for an underdog.

However, the reality in Japan is that there are only around 200 new IP lawsuits per year. In fact, there is an existing ADR system for IP disputes which is run by the Japan Intellectual Property Arbitration Center (JIPAC) established by the Japan Patent Attorneys Association (JPAA) and the Japan Federation of Bar Associations (JFBA). According to statistics provided by JIPAC, it receives less than 10 application cases per year, as shown in the right figure. It is far from active.

First of all, Japan should create an inviting environment for patent holders to utilize their patent right. Don't you think that patent holders are the underdogs?

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