The right of posterior use – how to use a patent without violating the patent holder’s rights

Manufacturers of products, as a rule, make plurality of effort to protect their intellectual property, in particular, they protect manufacturing technology, the very technical solution (device) and the appearance of this technical solution.

An effective measure of the protection is obtaining a patent for an invention, a utility model and an industrial design. Having a patent allows not only to use freely the result of intellectual activity, but also to prohibit its use to third parties.

So, in accordance with Paragraph 1 of Article 1229 of the Civil Code of the Russian Federation, “A citizen or a legal entity possessing the exclusive right to the result of intellectual activity or the means of individualization (a right holder) shall be entitled to use such result or such means at his own discretion in any manner that does not contradict to the law. The right holder may dispose of the exclusive right to the result of intellectual activity or to the means of individualization (Article 1233), unless otherwise is stipulated by this Code.

The right holder may at his discretion permit or prohibit other persons to use the result of intellectual activity or the means of individualization. The absence of a prohibition shall not be considered as consent (permission).

Other persons shall not use the respective result of intellectual activity or the means of individualization without the consent of the right holder, except the cases stipulated by this Code. The use of the result of intellectual activity or the means of individualization (including using them by the ways stipulated by this Code), if such use is carried out without the right holder’s consent, shall be illegal and shall entail the responsibility stipulated by the this Code and other laws, except the cases when the use of the result of intellectual activity or the means of individualization by the persons other than the right holder without the consent of the latter is allowed by the this Code.”

However, the technological process does not stand still, new advanced technologies are being developed, and obsolete devices are being improved and upgraded. Certainly, this can not but makes happy inventors and manufacturers. Except that not every technology and device is patented. This happens due to various circumstances, either it is impossible to obtain a patent, or there are simply not enough resources for this.

There is also a different category of manufacturers, as a rule, these are young entrepreneurs or only manufacturing companies that do not have a possibility or a desire to upgrade something at the expense of their own improvements. At such manufactures, the technical solutions that have already become publicly available are used and their use will not violate anybody’s rights.

The results of intellectual activity can become publicly available when the effect of the patent expires, and also it is allowed to use the patented solutions in case of an early termination of the effect of the patent. Such technical solutions can be recognized as used legitimately.

If it is established that the result of intellectual activity is used legitimately, then the requirement on prohibiting such use and seeking compensation can not be submitted to the manufacturer.

The following can be referred to the legitimate use of the result of intellectual activity (as it is regulated by Paragraph 1 of Article 1359 of the Civil Code of the Russian Federation): importing into the territory of the Russian Federation, applying, offering for sale, selling, another introduction into civil law transactions or storage for such purposes of the product in which an invention or a utility model is used or of the article in which an industrial design is used, if this product or article has been introduced earlier into the civil law transactions on the territory of the Russian Federation by the patent holder or by another person with the patent holder’s permission, provided that such introduction into the civil law transactions has been exercised legitimately in the cases stipulated by the law.

Even in the case of a legitimate use, there are the risks of the claims that can be filed by the patent holder; such risks should be taken into account and it is necessary to think over the consequences of declaring the use as illegal.

The legislation allows the use of the result of intellectual activity, the effect of the patent for which has been terminated early. As it follows from Article 1363 of the Civil Code of the Russian Federation, the effect of the exclusive right to an invention, a utility model, an industrial design and the patent certifying this right may be terminated early on the grounds and in the manner stipulated in Article 1399 of the Civil Code of the Russian Federation.

In accordance with Article 1399 of the Civil Code of the Russian Federation, “The effect of the patent for an invention, a utility model or an industrial design shall be terminated early in case of failure to pay in due time a patent fee for keeping the effect of the patent for an invention, a utility model or an industrial design – from the date of expiry of the stipulated time limit for paying the patent fee for keeping the effect of the patent.”

However, in case of paying in due time the fee for keeping the effect of the patent and for reinstating the missed period, the effect of the patent may be reinstated by the Federal Executive Authority on Intellectual Property upon the petition of the person who holds the patent, or of this person’s successor. The petition for the reinstatement of the effect of the patent may be filed to the above Federal Executive Authority within three years from the date of expiry of the time limit for paying the patent fee.

In the case of the reinstatement of the effect of the patent, the legal protection will be considered in effect and the patent holder will retain the exclusive right to use the result of intellectual activity in any manner that does not contradict to the law. The patent holder also retains the right to dispose of the exclusive right to an invention, a utility model or an industrial design and to prohibit its use to third parties.

In accordance with Paragraph 3 of Article 1400 of the Civil Code of the Russian Federation, “A person, who during the period between the date of termination of the effect of the patent for an invention, a utility model or an industrial design, and the date of publication in the official bulletin of the Federal Executive Authority on Intellectual Property of the data on the reinstatement of the effect of the patent, has begun to use the invention, the utility model or the industrial design, or he has made the necessary preparations for this within the above period, shall retain the right to its free posterior use without expanding the scope of such use (the right of posterior use).”

We often see the development of the following situation.

The patent holder who is not interested in using and keeping the effect of the patent does not pay a patent fee. As a consequence, the effect of the patent is terminated early.

The person, who is interested in using the result of intellectual activity, realizing that the patent is not in effect, organizes manufacture, promotes sales and multiplies profits.

Certainly, the patent holder who is carrying out the activity at the same market watches the development of his competitor. Realizing that the patent is used, the patent holder pays the fees and reinstates the legal protection of his technical solution.

Further steps are clear – filing a letter of claim, applying to court with a claim on the prohibition of the use of the patented invention, the utility model and the industrial design.

Guided by the provisions of Paragraph 3 of Article 1400 of the Civil Code of the Russian Federation, the user files a counter-claim, in which he argues that the actions for using the result of intellectual activity can not be deemed illegal and he demands to retain the right to further free using.

And again the bad news – there is a norm, but judging from the practice the courts support neglectful patent holders, who have “dropped” their patents, and they satisfy their claims, but as to the counter-claims, they refuse to satisfy them.

In this respect, the entrepreneurs should be rather careful when using “alien” intellectual property, even if it is obvious that the legal protection is terminated.