The prior use right to an invention, utility model or industrial design

In accordance with Article 1361 of the Civil Code of the Russian Federation, “The prior use right to an invention, utility model or industrial design,”

1. A person, who, before the priority date of an invention, utility model or industrial design (Articles 1381 and 1382), has used in good faith on the territory of the Russian Federation an identical solution created independently of the author or the solution that is different from the invention only with the equivalent features (Paragraph 3 of Article 1358), or who has made the necessary preparations for this, shall retain the right to the further gratuitous use of the identical solution without expanding the scope of such use (a prior use right).

2. The prior use right can be transferred to another person only together with the enterprise, where the use of the identical solution has taken place or the necessary preparations for this have been made.

As it follows from the above Article, the effect of the prior use right implies the availability of the following conditions:

- the good faith use of the identical solution (or the good faith necessary preparations for such use) on the territory of Russia before the priority date of the invention, utility model or industrial design;

- the creation of the identical solution that is independent of the author of the invention, utility model or industrial design;

- the non-expansion of the scope of the use of the identical solution.

Thus, the prior use right can be qualified as the case of the free (gratuitous) use of the invention, utility model or industrial design created in parallel (i.e., one’s own, but not someone else’s).

The prior use right is a subjective civil right that has an individual character and operates within the territory of Russia.

Paragraph 2 of the Article stipulates the only way of transferring the prior use right to another person: only together with the enterprise, where the use of the identical solution has taken place or the necessary preparations for this have been made.This means that the prior use right as a part of the enterprise shall not be allowed, a transaction in relation to the enterprise as a whole is necessary, and an independent transfer of this right being separate from this enterprise is not allowed as well.

Here are the examples of how the prior use right is considered by courts.

Example 1. Some Limited Liability Company filed a statement of claim to the Arbitration Court against some company on stopping the use of the utility model in its manufacture activities.

Satisfying the claim, the Court proceeded from the fact that the plaintiff had been granted a patent for the utility model. The defendant had violated the plaintiff’s exclusive rights to its use, because while manufacturing its products, it was using every feature presented in the independent claims of the utility model.

The Court of Appeal, while upholding the decision of the first-instance court, rejected the defendant’s arguments that before the priority date of the utility model, the defendant had created an identical solution independently of the plaintiff and retained the right to its further gratuitous use without expanding the scope.

At the same time, the Court of Appeal pointed out to the fact that the person’s availability of the prior use right was to be established through the legal proceedings. The defendant did not file to the court the correspondent claims, it did not file a counterclaim on the recognition of the prior use right, therefore, it did not prove according to the procedure established by the law the fact of the recognition for itself the prior use right within a particular scope.

The Court of Cassation canceled the adopted judicial acts and sent the case for a new consideration under the following grounds.

As it is known from the patent law norms, the exclusive right to the utility model belongs to the patent holder. No one shall be entitled to use the patented utility model without the permission of the patent holder, including to import into the territory of the Russian Federation, to manufacture, to use, to offer for sale, to sale or to introduce in other way into the civil circulation, or to store for these purposes the product, in which the patented utility model is used, except in the cases, if such actions are not the violation of the exclusive right of the patent holder.

Any person, who, prior to the priority date of the utility model, has used in good faith on the territory of the Russian Federation the identical solution created independently of its author or has made the necessary preparations for this, shall retain the right to its further gratuitous use without expanding the scope of such use.

The disputes on the violation of the exclusive right to the utility model and on the prior use right shall be considered in court.

In addition, the courts had not investigated the issue on the prior use right and the scopes of its use by the defendant. In this regard, the Court of Cassation canceled the decision of the first-instance court and the resolution of the Court of Appeal, and sent the case to the first-instance court for a new consideration.

Here is another example.

Example 2. If there are two patents for the utility model with the same features that are presented in the independent claim, before the patent with the later priority date is recognized as invalid according to the established procedure, the actions of the holder of this patent regarding its use cannot be considered as the violation of the patent with the earlier priority date.

Some Limited Liability Company filed a statement of claim to the Arbitration Court against some individual entrepreneur on stopping the violation of the exclusive rights to the utility model. To justify the claims, the plaintiff pointed out to the use by the defendant, while manufacturing his products, the utility model, which patent holder was the plaintiff. The defendant did not recognize the statement of claim explaining that he was also the holder of the patent for the utility model, and he was using that particular utility model, while manufacturing his products. The individual entrepreneur referred to the use by him in the manufactured products of the technical solution that was different from the plaintiff’s one.

The Court satisfied the claim under the following grounds. The plaintiff had the exclusive rights to the utility model with the earlier priority date than the defendant had. The patented utility model shall be recognized as used in a product or method, if the product comprises and the method uses every feature of the utility model presented in the independent claim of the utility model and that has become known as such in this art.

According to the examiner’s opinion based on the results of carrying out a patent examination appointed by the Court, every feature of the independent claim of the plaintiff’s utility model was used in the product manufactured by the defendant. An agreement on the transfer of the exclusive rights to the use of the utility model had not been concluded between the patent holder and the defendant. In such circumstances, the defendant’s actions for the use of the plaintiff’s utility model were the violation of the patent. The Court of Cassation canceled the decision of the first-instance court and dismissed the statement of claim pointing out to the following.

The first-instance court did not take into account the fact that both the plaintiff and the defendant had registered the right to the corresponding utility models. According to the examiner’s opinion, the defendant had used every feature of the independent claim of the plaintiff’s utility model in the manufactured product, however, at the same time, he was the holder of the rights to the utility model with the same features of the independent claim.

As it is known from the patent law norms, if there are several protection documents for the utility model with the same features presented in the independent claim, the issue on the recognition of any of these patents as invalid is referred to the competence of the Chamber for Patent Disputes. In the case that one of the patents is recognized as invalid, the holder of the rights to another patent shall be entitled to address again to the court for the defense of his rights, including by the way of damages for the entire period of the use of his patent, taking into account the fact that the recognition of the patent as invalid means the absence of the legal protection of such patent from the moment of filing an application for the grant of the patent to the Federal Service for Intellectual Property, Patents and Trademarks (hereinafter referred to as Rospatent).

If there are two patents for the utility model with the same features presented in the independent claim, before the patent with the later priority date is recognized as invalid according to the established procedure, the actions of the holder of this patent regarding its use cannot be considered as the violation of the patent with the earlier priority date.