7.5.3 Defense of invalidity
The defense of invalidity of a patent involves an alleged infringer asserting that a plaintiff’s patent should be invalidated.202 Alleged infringers assert the defense of invalidity in about 80 percent of patent infringement cases.203 An alleged infringer may also request a JPO trial for invalidation (see Section 7.4). These trials are often conducted in parallel with a court’s determination of invalidity, and sometimes conflicting decisions are reached (see below).
Alleged infringers will sometimes adopt a strategy of not filing for a trial for invalidation because they think that a court is more likely to find invalidity than the JPO, particularly in cases in which matters of fact are contested, such as fraud, violation of the rules relating to joint applications, or publicly worked inventions. Like any other claim, the defense of invalidity of a patent will be dismissed if the assertion is not made in a timely manner or if the case would be unduly delayed.204
The statutory basis for the defense of invalidity was introduced by an amendment of the Patent Act in 2004 in response to a decision by the Supreme Court (Kilby Case), which held that the defense of abuse of rights could be asserted even before a trial for invalidation by the JPO becomes final and binding.205 While the Supreme Court’s decision in Kilby suggested that a patent would have to be invalid due to lack of inventive step to allow the defense to be raised, Article 104-3(1) of the Patent Act did not include such a restriction. However, there is no substantive difference between the level of “obviousness” required as set out in the Supreme Court decision and Article 104-3(1).
7.5.3.1 Grounds for invalidity
The grounds for invalidity that can be claimed in a defense of invalidity are violations of the following patent requirements:
- amendment requirement (addition of new matter; Patent Act, Article 17-2(3));
- novelty (Patent Act, Article 29(1));
- inventive step (Patent Act, Article 29(2));
- prior art effect (Patent Act, Article 29-2);
- enablement requirement (Patent Act, Article 36(4)(i));
- support requirement (Patent Act, Article 36(6)(i));
- clarity requirement (Patent Act, Article 36(6)(ii)); and
- usurpation (Patent Act, Article 49(7)).
Various court decisions that have addressed these grounds for invalidity are outlined below.
7.5.3.1.1 Amendment requirement (addition of new matter; Patent Act, Article 17-2(3))
In the Solder Resist Case, a Grand Panel of the IP High Court stated that
[t]he “matters described in the description or drawings” are technical matters derived by a person having ordinary skill in the art putting together all statements in the specification or drawing. If a correction introduces no new technical matter in relation to those thus derived, the correction may be deemed to be within the scope of matters described in the description or drawings.206
The patentee who amended the patent bears the burden of proof for this ground for invalidity.207
7.5.3.1.2 Novelty (Patent Act, Article 29(1))
The IP High Court has held that
[i]n order for an “invention of a product” to be described in a “publication,” it is necessary to first disclose the structure of the invention in the publication, and as the invention is a creation of technical ideas (see Patent Act, Article 2(1)), it is necessary not only to disclose the structure of the invention but also to disclose the technical ideas of the invention to the extent that a person having ordinary skill in the art who has access to the “publication” can easily work the technical ideas.208
The alleged infringer bears the burden of proof for this ground for invalidity.
7.5.3.1.3 Inventive step (Patent Act, Article 29(2))
In Bridgestone Co., Ltd v. Commissioner of the Patent Office, the IP High Court found that
[t]he invention of this application arranges a surface rubber layer having a low elastic modulus so that the tire can exhibit the performance on ice even in the initial stage of use, whereas the cited invention enables the body layer to exhibit the specified performance quickly by removing the surface layer by peeling easily. Therefore, the concrete problem for enabling the body layer to exhibit the performance even in the initial stage of use is different, and the technical idea of each invention’s surface layer conflicts with each other.209
When problems solved by the invention and a cited invention are different, such a difference is considered to support a finding of inventive step. The alleged infringer bears the burden of proof for this ground for invalidity.
7.5.3.1.4 Prior art effect (Patent Act, Article 29-2)
Requirements for this ground are:
- another application (the other application) was filed on a day earlier than the filing date of the application concerned;
- the publication of the other application occurred after the filing date of the application concerned;
- the inventor of the invention in the other application was not the same as the inventor of the invention claimed in the application concerned; and
- the applicant for the other application was not the same as the applicant for the application concerned as of the filing date of the application concerned.
The Tokyo High Court has held that
[w]here the invention claimed in the application concerned and the cited invention are different but share substantial identity, it is deemed “identity” regarding the prior art effect.
Substantial identity referred to herein means a case where a difference between the invention claimed in the application concerned and the cited invention is a very minor difference (an addition, deletion, conversion, etc., of common general knowledge or commonly used art which does not yield any new effect) in embodying means for resolving a problem.210
The IP High Court has stated that
[e]ven if there is no particular statement in the description etc. of the prior application, the invention of the prior application can be found taking into consideration the common general technical knowledge of a person having ordinary skill in the art in order to understand the invention of the prior application. On the other hand, in the case where an invention is abstract, or technical content of an invention is insufficiently disclosed even taking into consideration the common general technical knowledge of a person having ordinary skill in the art, such invention does not fall under the “invention” mentioned above and does not have the effect of excluding the later application provided for in this Article. Further, created technical content which is not configured to the extent that any person having ordinary knowledge and experience in the art can repeatedly work the technical content to achieve an intended technical effect is not yet an “invention” and it should not be deemed that such technical content falls under “invention” as referred to in Article 29-2 of the Patent Act.211
The alleged infringer bears the burden of proof for this ground for invalidity.
7.5.3.1.5 Enablement requirement (Patent Act, Article 36(1)(i))
The IP High Court has held that
[i]n order to satisfy the enablement requirement for a process, the detailed description of the invention is required to have a description to such a degree that a person having ordinary skill in the art can use the process without requiring excessive trial and error on the basis of the contents described in the detailed description of the invention and the common general technical knowledge as at the time of filing, and the presence of the description to such a degree is sufficient.
In order to satisfy the enablement requirement for a product, the detailed description of the invention is required to have a description to such a degree that a person having ordinary skill in the art can make the product without requiring excessive trial and error on the basis of the contents described in the detailed description of the Invention and the common general technical knowledge as of the time of the filing.212
The IP High Court has also held that
[i]n order to fulfil the enablement requirement for a process for producing the product, the detailed description of the invention is required to have a description to such a degree that a person having ordinary skill in the art can use the process and also can use the product produced by the process without requiring excessive trial and error on the basis of the contents described in the detailed description of the invention and the common general technical knowledge as of the time of the filing.213
The patentee bears the burden of proof for this ground for invalidity (as long as it is the same patent that is the subject of an invalidation trial before the JPO (common view)).
7.5.3.1.6 Support requirement (Patent Act, Article 36(6)(i))
In the Polarizing Film Manufacturing Process Case, a Grand Panel of the IP High Court held that
[c]laim recitations are first compared with the detailed description of the invention; then the fulfillment of the Support Requirement is determined according to whether the claimed invention was described in the detailed description of the invention, whether a person having ordinary skill in the art could have solved the problem of the claimed invention based on its recitations, or a person having ordinary skill in the art could have solved the problem of the claimed invention based on common technical knowledge at the filing date given that the recitations were not included nor suggested in the detailed description of the invention.214
The patentee bears the burden of proof for this ground for invalidity (as long as it is the same patent that is the subject of an invalidation trial before the JPO (common view)).
7.5.3.1.7 Clarity requirement (Patent Act, Article 36(6)(ii))
The IP High Court has held that
[Article 36(6)(ii) of the Patent Act] was established in view of the fact that, if the invention presented in the claims is not clear enough, the technical scope of the invention protected by the patent would be unclear and could cause unexpected disadvantage to third parties. The objective of this provision is to prevent such inconvenience. A determination as to whether or not the invention claimed in a patent application is clear should be determined based not only on the information presented in the claims but also on the information presented in the description and drawings attached to the patent application. Moreover, that determination should be made from the perspective of whether the information presented in the claims can be considered to be so unclear that it would make third parties suffer unexpected disadvantages in light of the common general technical knowledge of persons having ordinary skill in the art as of the time of the filing of the application.215
However, the IP High Court has also held that
[e]ven if a process for manufacturing a product is described in the scope of claims for a product, if it is clear from the scope of claims, description, drawings, and common general knowledge that the structure or properties of the product are represented by the process, the benefit of a third party is not unreasonably harmed, and therefore, it does not constitute a violation of the clarity requirement.216
The patentee bears the burden of proof for this ground for invalidity (as long as it is the same patent that is the subject of an invalidation trial before the JPO (common view)).
7.5.3.1.8 Usurpation (Patent Act, Article 49(7))
The IP High Court has held that
[i]n a trial for patent invalidation requested on the grounds of a usurped application, it is the patentee that bears the burden of allegation and proof in relation to the fact that “the patent application was filed by the inventor of the invention for which a patent was sought or by a person to whom the right to obtain a patent was assigned from the inventor.” Even if such interpretation is adopted, it would not mean that the patentee of an invention who faces such a trial is always required to present independent, specific, concrete, and detailed allegations and proof with regard to how the invention was made. The required breadth and depth of the patentee’s allegations and proof should be determined based on the nature of the specific grounds that allege that the patent was granted based on a usurped application and also based on the breadth and depth of the allegations and proof of the person who requested a trial for invalidation, and also that, if the person who requested a trial for invalidation fails to provide any specific grounds to allege that the patent was granted based on a usurped application and also fails to provide any evidence for such allegation, the patentee is merely required to provide relatively simple allegations and proof. Whereas, if the person who requested a trial for invalidation provides specific grounds to allege that the patent was granted based on a usurped application and also provides evidence for such allegation, the patentee cannot be considered to have fulfilled the burden of allegation and proof unless the patentee provides allegations and proof that outweigh the allegations and proof provided by the former person.217
The alleged infringer bears the burden of proof for this ground for invalidity. However, for this ground, the burden of proof will pass to the patentee if the appellant of a trial for invalidation identifies circumstances in support of usurpation.218
7.5.3.2 Parallel Japan Patent Office trial for invalidation
As noted above, an alleged infringer may request a JPO trial for invalidation in addition to asserting the defense of invalidity in a patent infringement lawsuit. JPO trials are frequently conducted in parallel to a court’s proceedings, and conflicting decisions are sometimes reached. However, an invalidity determination by the court affects only the parties and therefore does not invalidate the patent with respect to third parties. Only the JPO can invalidate a patent with erga omnes effect.
When a JPO trial for invalidation results in a decision that a patent is invalid, and that decision become final and binding, the patent is invalid for the parties and any third parties. Therefore, the patent will also be invalid for the purpose of a patent infringement lawsuit, and so the case will be decided against the patentee.
When a JPO trial for invalidation results in a decision that a patent is valid and should be maintained, and the decision becomes final and binding – and the defendant does not appeal the JPO decision to the IP High Court – it will be impossible to assert a defense of invalidity on the same grounds in a patent infringement lawsuit. This is because it would be a violation of the doctrine of good faith and fair dealing.219 Therefore, if an alleged infringer in a patent infringement lawsuit is not successful in a parallel JPO trial for invalidation, the alleged infringer must appeal to the IP High Court.220
7.5.3.3 Limitations on assertions in retrials
In patent infringement proceedings, a defendant may assert a defense of invalidity, and a plaintiff may assert a defense of correction, and both parties will present their views as to the validity and scope of the allegedly infringed patent. However, there is the potential that a JPO decision in a trial for invalidation or a trial for correction – that differs from the judgment in a patent infringement lawsuit in relation to the validity and scope of a patent – becomes final and binding after the judgment in the patent infringement lawsuit becomes final and binding, thereby reversing that judgment. Thus, in 2011, the Patent Act was amended to impose certain limitations on the assertions that may be made in a retrial under Article 338(1)(viii) of the Code of Civil Procedure (when a civil judgment has been modified by a subsequent administrative decision).
Article 104-4 of the Patent Act provides that if a JPO trial or appeal decision – that a patent is to be invalidated or corrected – becomes final and binding after a final judgment in a patent infringement lawsuit becomes final and binding, a person that was a party to the patent infringement lawsuit may not assert that JPO trial or appeal in a retrial of the final decision in the patent infringement lawsuit, including in any action claiming compensation for damages and restitution for unjust enrichment.
For example, a person who has been found liable for infringement in a patent infringement lawsuit cannot, in a retrial of the lawsuit, demand the return of compensation for damages or restitution paid if the JPO later finds the patent to be invalid. In these circumstances, an injunction order issued in a patent infringement lawsuit would no longer be effective because the basis for infringement would have disappeared. Any compensation or restitution already paid cannot be reclaimed.
In addition, although not originally envisaged by Article 104-4, the IP High Court has held that
because the Patent Act provides that an alleged infringing item that does not fall within the technical scope of the patent invention before a correction does not fall within the technical scope of the patented invention after a correction, an allegation by a patentee in a retrial that an alleged infringing item falls within the technical scope of the patent invention as a result of a JPO decision upholding a correction but after a judgment that dismissed the request on the grounds that the alleged infringing item did not fall within the technical scope of the patent invention, is not envisaged by the Patent Act.221
Therefore, an alleged infringer must strongly argue the defense of invalidity, and a patentee must strongly argue the defense of correction in patent litigation proceedings. Otherwise, even if a favorable JPO trial decision becomes final and binding after the judgment of a court in a patent infringement lawsuit becomes final and binding, the judgment of the latter may not be reversed in a retrial.