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EPO – Exercise of the right of priority by the successor in title – requirements of a valid transfer

28 Mar 2017

European Patent Office, Technical Board of Appeal 3.2.05, T 577/11, decision of April 14, 2016, not to be published in OJ EPO – Entitlement to priority

Headnotes 1 and 2 of the reported decision deal with the procedural aspect of admitting new submissions in second oral proceedings, headnotes 3 and 4 read as follows:

3. For a claimed priority to be valid pursuant to Article 87(1) EPC 1973, the applicant of a subsequent application claiming priority from an earlier application (priority application) who is not the person who filed the priority application must, when the subsequent application is filed, be that person’s successor in title in respect of the priority application or of the right to claim priority. A succession in title that occurs after the filing date of the subsequent application is not sufficient to comply with the requirements of Article 87(1) EPC 1973 (see Reasons, point 6.5).

4. Where the applicant of the priority application and the applicant of the subsequent application contractually agree that (only) economic ownership (“economische eigendom” under Dutch law) of the priority application and the right to claim its priority is to be transferred to the subsequent applicant, this is not sufficient to consider the latter a successor in title within the meaning of Article 87(1) EPC 1973 (see Reasons, point 6.6.2).

In the case underlying the decision, a first application had been filed by the Dutch Company TC BV in Italy. Later, a PCT application, claiming in the request form priority from the first application, was filed by TC AG, residing in Liechtenstein and 5 natural persons, the latter as applicants for the US only. No declaration as to the applicants’ entitlement to priority was filed in the international phase nor did the EPO invite the applicant to file such a declaration under Article 81, 2nd sentence, EPC. In opposition proceedings, the right of priority was challenged and the proprietor, meanwhile TC Ltd., registered in Saint Vincent and the Grenadines, submitted an agreement between TC BV and TC AG assigning the priority right. The agreement was dated 3 days after the filing date of the PCT application but stipulated a retroactive effect of the assignment to be effective from January 1 of the respective year. On this basis, the Opposition Division concluded that the priority had been validly claimed.

In appeal proceedings, the appellant/opponent continued to challenge the right of priority. The respondent/proprietor presented 3 lines of argument why TC AG was the successor in title of TC BV:

(i) The date of assignment was prior to the 16-month period for filing the declaration of priority;
(ii) Under Italian and Dutch Law it was possible to assign the priority right with retroactive effect; and
(iii) TC BV and TC AG belonged to the same corporate group TC SA. Under Italian Law, no particular form was required for an assignment of the priority right. The filing of the PCT application constituted “convincing behavior” showing that TC AG was the rightful owner of the priority right.

In first oral proceedings, the validity of the claimed priority was discussed. Based on the instructions to file the PCT application, the proprietor’s representative presented a further line of argument for a valid transfer of the priority right and submitted a declaration as means of evidence in support:

(iv) The transfer of the priority right had been orally agreed between TC BV and TC AG.

Before closing the oral proceedings, the Chairman closed the debate with regard to the issues already discussed.

After summons to second oral proceedings, a further line of argument (v) was developed according to which there was an agreement “manifested by conclusive action” prior to the filing of the PCT application. In support, an e-mail exchange preceding the filing of the PCT application was submitted.

In the second oral proceedings, the submissions related to lines (iv) and (v) were not admitted in the proceedings. They were considered as an amendment to the opponent’s case and, applying its discretion under the Rules of Procedure, the Board found that they gave rise to additional questions or were not highly relevant.

As to approaches (i) to (iii), the Board re-opened the debate.
(i) The Board concludes that the wording of Article 87 (1) EPC makes clear that an applicant different from the applicant of the first application has to be successor in title of the right of priority when filing the European application. This is in line with Article 4A (1) of the Paris Convention, its legislative history and the relevant case law of national courts in EPC contracting states.

(ii) The Board does not decide whether Italian or Dutch law is applicable when assessing the effects of the written transfer agreement. For the Italian Law, the Board finds that the extent to which the retroactive effect would be recognized has not been established. For the Dutch law the Board finds that “economische eigendom” amounts to a limited transfer of rights, as opposed to a transfer of overall rights of ownership. Therefore, the Board does not consider it necessary to decide on the more general and important question, previously raised in the proceedings, whether the retroactive effect of a contractual agreement can be acknowledged under Article 87 (1) EPC.

In this respect, it may be added that the right of priority only exists within the priority period. It is difficult to imagine why a right which can no longer be exercised can still be transferred. As already stated in Roman law: nemo plus iuris transferre potest quam ipse habet. Furthermore, the question arises whether the express requirement of patent law that the applicant has to be successor in title at the filing date can be at the disposal of the parties and may be circumvented by relying on national civil law.

(iii) As to the alleged agreement by “conclusive action” which the Board understands as an agreement implied by conduct, the Board concludes that the sole act of filing a subsequent application of one company of a corporate group which claims priority from an earlier application of another company of the same group does not clearly imply that there was a mutual agreement concerning a transfer of ownership. The Board distinguishes the decision of the German Federal Supreme Court (BGH) decision Fahrzeugscheibe (GRUR 2013, 712) in which the Court interpreted the communication between the parties as an offer of a transfer and as an acceptance of this offer based on an agreement in a cooperation contract.

The Board does not consider a referral to the Enlarged Board of Appeal necessary since its conclusions based on the wording of the EPC and the Paris Convention are confirmed by their purpose and the preparatory documents. Furthermore, they are considered to be consistent with the existing case law of the Boards of Appeal and of national courts.

Read decision T 577/11 here.

Reported by Rudolf Teschemacher