In light of recent events, the Russian Federation issued a decree for a new methodology for compensating for patent infringement where a patentee originates from an unfriendly country.[1] While the decree does not preclude a patentee from seeking relief, it reduces the maximum relief available to those patentees to $0, rendering such actions fruitless. It may surprise many to learn that this is not the first instance of such draconian methods being employed, particularly during war.
During WWI and WWII, the United States took it one step further seizing, and in some cases keeping secret, tens of thousands of enemy owned patents.[2] However, unlike WWI and WWII, improvements to computer technology have revolutionised the ability to receive and distribute information through the internet. As such, the ability to hide patent information has become virtually impossible due to widely accessible databases such as Espacenet, maintained by the European Patent Office, in combination with machine translation tools.
Furthermore, the decision to discriminate based on a patentee’s nationality directly contradicts the TRIPS Agreement,[3] which most major countries are signatories, and undermines confidence in the patent system worldwide. One of the side effects of these types of legal mechanisms, particularly keeping technical data secret, is a decrease in follow-on invention.[4] More easily understood, the output of invention from one inventor may be used as the basis for the input for the start of invention from another inventor.[5]
As a patentee from an “unfriendly” country, what can you do to best protect your rights? Unfortunately, the answer is not much. Historically, during a war it appears unlikely that you will receive the appropriate compensation for unauthorized use of your technology. However, it appears that the patentees who had their patents seized by the United States received nominal compensation.[6] Notably, their inventions were also directly related to defence. Accordingly, it may be prudent to consider the likelihood that your invention could be used for warfare and what benefits, if any, you receive from maintaining a patent which may never be available to be exploited or prevent others from exploiting.
The good news is that the majority of countries appear to be committed to the obligations as set out in the TRIPS Agreement. Deviating from these well-established obligations can result in harsh sanctions capable of debilitating a country’s trade and commerce sector immediately, as well as perception of future patentees to seek protection in those countries in the future. While it is not always possible to anticipate how or when a war will commence, recent conflict has reminded us of the fragility of international law and the potential disruptions caused by war.
If you have a Russian patent or patent application and you have any further questions, please let us know.
[1] On Amendments to Clause 2 of the Methodology for Determining the Amount of Compensation Paid to a Patent Owner When Deciding to Use an Invention, Utility Model or Industrial Design without His Consent, and the Procedure for Its Payment (Russian Federation) Government of the Russian Federation, Decree No 299, 6 March 2022.
[2] Alexander Holtzoff, ‘Enemy Patents in the United States’ (1932) 26(2) The American Journal of International Law 272, 272; Michael White, ‘Patents for Victory: Disseminating Enemy Technical Information During World War II’ (2008) 22 Science & Technology Libraries 5.
[3] The Agreement on Trade-Related Aspects of Intellectual Property Rights, opened for signature 15 April 1994 (entered into force 1 January 1995) art 3.
[4] Daniel P. Gross, ‘The Hidden Costs of Securing Innovation: The Manifold Impacts of Compulsory Invention Secrecy’ (Working Paper No 25545, National Bureau of Economic Research, 2019) 2.
