1. Intellectual Property System in Japan
Toshiko Takenaka, Ph.D.
WRF/W. Hunter Simpson Prof. of Tech Law,
Director, CASRIP,
University of Washington School of Law

2. Outline Overview of Japan’s IP System Japan’s National IP Strategy
Int’l Agreements
Infrastructures
Domestic laws
Japan’s National IP Strategy
Basic IP Law and Its Implementation
Evaluation of Impact from National IP Strategy

3. IP System Overview

4. Int’l Agreements Paris Convention (1883) Berne Convention (1886)
Industrial Property
National Treatment; Right of Priority; Independence of Patents
Berne Convention (1886)
Copyright
No Formality Requirement

5. Int’l Agreements WTO TRIPS (1994)
Industrial Property; Copyright; Geographical Indication; IC Layout Designs; Trade Secrets; Licenses
Most favored Nation Treatment
IP Enforcement

6. Overview Industrial Property – JPO-METI
Patents and Utility Model
Industrial Designs
Trademark (Geographical Indications)
Unfair Competition
Trade secrets, trade dress, unregistered TM
IC Layout-Designs
Copyright & Related Rights– MEXT

7. Patents Eligible Subject Matter First-to-File Principle
Living subject matter; software
Medical methods
First-to-File Principle
6 month grace period (scope limited)
Substantive Examination
Domestic Priority System
No opposition proceeding
Patent Term: 20 years from filing

8. Comparative Law Business Method; Computer Software
U.S.: Bilski
Machine-or-Transformation Test
Applicable to process claims
Meaning limits to the claim scope
Tied to a machine, manufacture or composition of matter or
Transform an article into a different status or thing

9. Comparative Law Business Method; Computer Software
U.S.: Bilski
Machine prong
Mere field-of-use limitation insufficient
Insignificant post-solution activities insufficient
Transformation prong
Not limited to a physical object or substance
Include electric signal representative of a physical object or substance

10. Comparative Law Business Method; Computer Software
Japan: Patent Act
Article 2: Definition of Statutory Invention
"Invention" in this Act means the highly advanced creation of technical ideas utilizing the laws of nature.

11. Comparative Law Business Method; Computer Software
JPO Examination Guidelines
Non-statutory Inventions
A law of nature as such
Mere discoveries
Those contrary to a law of nature
Those in which a law of nature is not utilized
Example: A method of collecting money for an electricity bill or a gas bill etc., by rounding off the total amount to be collected to the nearest 10 yen unit.

12. Comparative Law Business Method; Computer Software
As a Whole Approach
Even if a claim includes an element which utilizes a law of nature, claimed subject matter as a whole must utilize a law of nature
Business methods which are not tied to a machine fall into this category.
Computer Software-Related Inventions
A claim utilizes a law of nature and thus patent-eligible if it passes Japanese machine test.

13. Comparative Law Business Method; Computer Software
JPO Examination Guidelines
Japanese Machine Test
Hardware resources must concretely execute information processing through software
Reading the clamed software into a computer results in a machine for a special use
Such machine provides a concrete means in which software and hardware resources are cooperatively working so as to realize the specific use through arithmetic operation or manipulation of information

14. Comparative Law Business Method; Computer Software
JPO Examination Guidelines
Examples of Statutory Inventions
Software providing control of a machine or data processing for the control
Software providing data processing based on the physical or technical properties of an object

15. Patents Exclusive Rights Limitations
Making, using, offering for assigning & exporting, assigning, importing & exporting a patented product
Using a patented process or using, offering for assignment & exporting, assigning, importing & exporting the product obtained by the process
Limitations
Private use; experimental use

16. Patents Scope of Protection Defense of Invalidity
Claims define the scope of exclusivity
Reference to the specification and drawings
Literal Infringement
Doctrine of Equivalents
Defense of Invalidity
Infringement proceeding
Invalidation trial at JPO

17. Utility Model Petite Patent System
Eligible Subject Matter
Method is excluded from eligibility
No Substantial Examination
Eligible subject matter
Limitation on Enforcement
JPO’s validity certificate is necessary
Protection Term: 6 years from filing

18. Industrial Designs Eligible Subject Matter Substantive Examination
Shape, pattern or color or any combination of an article
Substantive Examination
Novelty and nonobviousness
Protection Term: 15 years from filing

19. Trademarks Unfair Competition
Registered mark: Trademark law
Characters, figures, signs, three-dimensional shapes of goods
Limited scope of eligible subject matter
Unregistered mark: UCPL
Well known mark
Famous mark
Trade dress protection

20. Trademarks Unfair Competition
Trade Dress Protection
Difficult to obtain a registration
No inherently Distinctive
Very difficult to establish secondary meaning
No protection for color as such
Unregistered Trade Dress
New design in Japanese Market
Automatic three year protection

21. Trade Secret Misappropriation of Proprietary Information
The act of acquiring a trade secret while being aware that such trade secret has been acquired through improper acquisition or, through gross negligence, not being aware of such matter; or the act of using or disclosing a trade secret so acquired;
The act of using or disclosing a trade secret after becoming aware, subsequent to its acquisition, that such trade secret has been acquired through improper acquisition or, through gross negligence, not becoming aware of such matter;
The act of using or disclosing a trade secret which has been disclosed by the business entity holding it for the purpose of unfair business competition or otherwise acquiring an unfair benefit, or for the purpose of inflicting injury on such holder;

22. Trade Secret
The act of acquiring a trade secret while being aware or, through gross negligence, not being aware that there has been an improper disclosure of such trade secret (defined, in this case and hereinafter, in the case stipulated in the previous item, as an act of disclosing a trade secret for the purpose stipulated in such item, or an act of disclosing a trade secret in breach of a legal duty to maintain secrecy) or that such trade secret has been acquired through improper disclosure; or the act of using or disclosing a trade secret so acquired;
The act of using or disclosing an acquired trade secret after becoming aware, subsequent to its acquisition, that there has been improper disclosure of such trade secret or that such trade secret has been acquired through improper disclosure, or, through gross negligence, not being aware of such matter;

23. Copyrights Author’s Rights Moral Rights
Divulgence: If or how his work is published.
Authorship: how his authorship is represented in the work.
Integrity: Preventing the modification of her work
Economic Rights
Reproduction
Adaptation
Communication

24. Copyrights Neighboring Rights Performer’s rights
Phonogram producers’ rights
Broadcasters’ and wire diffusers’ rights

25. Copyright Conditions for Protection No Formality Requirements
Fixation or registration is not necessary
Creativity
Similar to a modicum of creativity required by US Supr. Ct. in Feist
Thin protection for compilation of facts
Asaban v. Higashi-Nihon Tel, Tokyo Hi. Ct. Sept. 7, 2000

26. Copyrights Limitations A list of exceptions Private use Library use
Quotations
Textbook use
Educational use
Non-profit performance
Press release
Political speech etc.

27. Copyrights Fair Use No general Provision
Can a parody be a defense for Japanese copyright infringement?
Possibly yes under the quotation exception
But no regarding moral right

28. Japan’s National IP Strategy and Its Impact: Comparative Analysis
Toshiko Takenaka, Ph.D.
WRF/W. Hunter Simpson Prof. of Tech Law,
Director, CASRIP,
University of Washington School of Law

29. Background METI-JPO “Pro-Patent Policy” Initiative Political Landscape
Mr. Hisamitsu Arai
Major patent law revisions during his tenure as JPO Commissioner (Damages)
Political Landscape
JPO/METI
Committees (Experts)
Competition with other ministries and agencies
Industry groups (Nippon Keidanren, JIPA, etc.)
IP Professionals (JFBA, JPAA, etc.)

30. Basic IP Law Enacted: November 2002 National Strategies
To enhance competitiveness by enriching Japan with IP rights (IP-based nation)
Intellectual Creation Cycle
Creation of IP Strategy Headquarters within Cabinet
To develop a uniform IP policy
To coordinate activities at the ministry and agency levels

31. IP Headquarters Original Composition
Prime Minister Koizumi and his cabinet members
Secretariat
Headed by Mr. Hisamitsu Arai
Bureaucrats dispatched from related ministries and agencies, and courts
Experts
Industry representatives, professors and lawyers

32. IP Headquarters Annual Strategic Program & Review Expert Task Forces
Set a target for each action plan executed by a ministry or agency
Revise the target if necessary
Expert Task Forces
Medical method patents
Media content
Enforcement

33. First Phase Self-Assessment
Major Advancements
IP Creation
Japanese Bayh-Dole System
IP Protection
IP High Court
Human Resources
Legal Education for IP Professionals

34. Technology Transfer System University Inventions
Japanese Bayh-Dole Act
Enacted: 1999
Universities retain IP rights resulting from publicly funded research
TLO Promotion Act
A variety of support to facilitate university to TLO creation

35. Technology Transfer System University Inventions
Pre-Basic IP Law
Professors retain IP rights in university inventions
Post-Basic IP Law
National universities obtained a legal entity
Majority of Japanese universities adopted an IP policy to obtain IP rights in university inventions from professors

36. Impact of Legislation
Increase in Patent Applications and Royalty Revenues
Domestic Applications
Foreign Applications
Royalty Revenues
(Thousand-Yen)
Domestic Applications
Foreign Applications
Royalty Revenues

37. Technology Transfer System University Inventions
Increase in number of patent applications

38. Technology Transfer
Increase in number of tech. ventures

39. IP High Court IP Enforcement Restructure 2003 Civil Proc. Revision
Exclusive jurisdiction: First instance-Tokyo & Osaka Dist. Ct.; Appeal-Tokyo High Ct.
April 2005: IP High Court
Semi-independent from Tokyo High Court
Patent-Technology expertise in all levels

40. IP High Court Symbol of Pro-Patent Policy Patent Unfriendly Judges
Dist. Courts - Rocket-docket
Patent experienced judges
Chosakan plus external expert committee
Patent Unfriendly Judges
High Invalidity Rate
Low chance of infringement finding
Limited damages

41. Invalidity in Litigation

42. Invalidity through the JPO

43. Legal Education IP Professionals American Style Law School System
Business experience
Science background
Competent in global market
American Style Law School System
Educating in-house counsels and patent attorneys in industry (shakai-jin)
Educating students with science background

44. Legal Education Bar passing rate – lower than expected
Expectation: 70-80%
Justice System Reform Council Recommendation
2006: 48.35%
2007: %
2008: 27-32% (expected)
IP – Optional subject in Bar Exam

45. Legal Education Entering Student Body Total Shakai-jin 2004 5767 486
Engineering
Science
Shakai-jin
2004
5767
486
(8.4%)
2792
(48.4%)
2005
5544
432
(7.8%)
2091
(37.7%)
2006
5784
326
(5.6%)
1925
(33.2%)
2007
5713
273
(4.7%)
1834
(32.1%)

46. Legal Education Focus on Bar Exam Subject Noki-Ben problem
Very little expansion of job opportunities
Marginal or zero compensation
IP Professional Schools
More evening schools
Taught by business people and lawyers
More attractive to Shakai-jin

47. Did Japan complete the mission for National IP Strategies?
Impact on Japan’s Economy and Int’l Competitiveness

48. Technology Trade Balance Major Countries

49. Technology Trade Balance

50. Technology Trade Balance USA
Matoaki Suzuki, Powerful and Overwhelming IP Activities in the Pro-patent Era (

51. Technology Trade Balance Japan

52. Int’l Competitiveness IMD Ranking

53. Int’l Competitiveness Global Competitiveness Report Ranking

54. Conclusion Japan’s mission completed
Japan created a unique IP system by adopting U.S. systems through localization
Japan’s economy shows a strong sign of recovery and its ranking of int’l competitiveness is improving
But the recovery of Japan’s economy is suffering from the impact of subprime loan crisis in the United States and rapid increases in oils and raw materials