Governments across the world have adopted measures seeking a balance between the primary goal of safeguarding public health and the protection of the economy during the COVID-19 pandemic. Some of the measures directly or indirectly affect IP rights.
When a pandemic alert was issued for some northern Italian localities at the end of February, the government declared a state of national emergency until the end of July 2020. On March 9, the movement restrictions became nationwide. Based on the power conferred by Article 77 of the Italian Constitution[1], the government adopted several emergency decrees: No. 6 of February 23 2020; No. 18 of March 17 2020; and No. 23 of April 08 2020[2]. The emergency laws do not address specific IP issues, but they affected public bodies and businesses.
Impact on the IP Office
Time limits suspended
The Director General of the Italian Patent and Trademark Office (IPTO) issued a decree on March 11 2020[3] suspending all pending deadlines relating to proceedings before the Office for the period between March 9 2020 and April 3 2020, except for mandatory time limits, including the three-month term after the trade mark application publication for filing opposition proceedings. Time limits concerning appeals against IPTO decisions were excluded because appeals before the Board of Appeals are considered judicial proceedings and amended only by legislation.
Decrees No. 18 of March 17 2020 and No. 23 of April 8 2020 have superseded the provisions in the Director General’s decree. Decree No.18 introduced, under Article 103(1), a general suspension of all time limits applicable to administrative proceedings and extended the scope and duration of the suspension to all time limits without exception. No. 23 introduced, under Article 37(1), a further temporary extension of the above measures.
Because of these decrees, both statutory time limits and IPTO time limits for administrative proceedings before the Office as of February 23 or after that date are suspended for the period between February 23 and May 15. The time limits include the deadline for submitting the power of attorney; filing a priority document[4]; replying to office actions; validating a European patent; and opposition proceedings[5].
Renewal of IP rights
A special provision applies to the renewal of certificates of any kind. In fact, according to Article 103(2) of Decree No. 18, certificates, grants and authorisations expiring between January 31 2020 and April 15 2020[6] shall remain valid until June 15 2020.
This provision applies to the renewal of trade marks and designs, including the payment of the corresponding renewal fees, whose expiration date calculated with respect to the filing date is between 31 January and April 15 2020. Their expiry term is therefore extended to June 15 2020 and, with a surcharge, for an additional 6 months. The bill for the law which is to be voted by Parliament to confirm the above decrees should extend the above terms[7]. It is, however, doubtful that this provision could be applicable to patents since no special provision applies to government maintenance fees.
Effects on IPTO-related proceedings
The effect of the suspension is that time limits for pending proceedings will resume from May 16 2020 for the remainder of the time that still has to run, whereas time limits in which the initial date falls after February 22 will only start running from May 16.
In view of the nature of judicial and non-administrative proceedings, time limits relating to appeals before the IPTO Board of Appeals are excluded from the scope of the above provisions regarding administrative proceedings. Their legal basis shall be sought in Article 83(1), which provides for the suspension of time limits relating to judicial procedures, and in Article 36 of Decree No. 23, which extends the length of the suspension (initially set to run until April 15).
By virtue of both provisions, the suspension runs from March 9 until May 11, which means that resumption of proceedings takes place as of May 12 for the remainder of the time that still has to run. The suspension concerns time limits for the notification of appeals before the Board of Appeals and other subsequent time limits that depend upon such notification. Furthermore, if a hearing is scheduled, the date of the hearing will be postponed until after May 11.
Impact on the courts and IP enforcement
As outlined above, the decrees issued by the Italian government set general rules concerning administrative and court proceedings. Therefore, court actions relating to the enforcement of IP rights fall into the scope of the rules.
In general, the above-mentioned decrees[8]have suspended all judicial activities and, in particular, hearings and filing of actions and judicial briefs starting from March 9 until May 11 (a total amount of 83 days). They also suspended the terms for performing other acts done during court proceedings (for example, technical briefs and activities carried out by court-appointed and by ex-parte experts during the technical expertise phase).
With reference to the filing of initial briefs, such as writs of summons or petitions for interim relief, courts will neither schedule hearings nor grant ex parte requests. Moreover, hearings which should have been held in the period between March 9 and May 11 will be rescheduled after the end of the suspension period.
The decrees also suspended terms mandated by the law or by the courts for the filing of defensive briefs and carrying out activities that occur during proceedings. Consequently, terms to file such briefs and perform such acts must be re-calculated according to the suspension period (83 days), as provided for by the decrees. In this regard, there are three possible scenarios:
(i) If the term to file the brief or perform the act started before March 9, the suspension will affect the final date of the term, which will be re-calculated adding 83 days to the original time limit.
(ii) If the initial date of the term to file the brief or perform the act falls within the suspension period, the term will start to elapse once the suspension period ends (therefore, since May 12).
(iii) If the term to file the brief or perform the act is to be calculated going backwards and it falls within the suspension period, the court must reschedule the hearing or the other act in order to make such a term fall after the end of the suspension period.
The courts, in particular the specialised business sections which are competent to hear IP cases, are rescheduling all hearings and time limits as specified by the general provisions in the decrees relating to court litigation.
In a few cases, the courts are trying to hold hearings by video conference, especially those relating to interim relief proceedings scheduled before the time limit suspension. Indeed, according to the decrees, it is possible until June 30 2020 to hold hearings by video conference in order to reduce any backlog caused by the suspension. It should be noted that the general rule on the suspension of judicial time limits and the postponement of hearings applies mutatis mutandis to criminal proceedings involving IP rights.
It should be noted that each court will prepare internal guidelines on the application of the suspension of time limits. The District Court of Milan has already issued its own, stating that the suspension does not apply to fundamental rights and to urgent measures for which a delay could cause prejudice to the parties involved. The urgent measures may include measures against acts that seriously affect business activities or compromise the integrity of goodwill or essential elements of business activity (for instance, the protection of trade marks or other company assets).
Conclusion
The application or interpretation of the COVID-19 emergency legislation in relation to IP rights is not entirely clear. This is particularly the case for the calculation of time limits when filing, prosecuting or maintaining IP rights as well as when enforcing or defending them before the Italian courts.
Furthermore, identifying the acts that are affected by the provisions - and to what extent - is not always straightforward, especially considering the frequency with which legislation needs to be updated. For this reason, an exhaustive and detailed understanding of the interaction between these provisions is necessary to avoid risks to IP rights.
Because of the suspension of judicial activities, a swift enforcement of IP rights appears unlikely, even by means of urgent proceedings such as preliminary relief. In any case, from a practical approach, the lockdown of all non-essential sectors makes the enforcement of orders such as destruction or seizure of counterfeiting and/or infringing goods quite unfeasible. Many businesses will probably resume activities in May, followed by a resumption of normal service for IP enforcement proceedings before the Italian courts.
Footnotes:
[1] A decree has the force of law and it is adopted by the government in times of necessity and urgency. It is issued by the President of the Republic and immediately introduced to Parliament to be transposed into law, something which must happen within 60 days or the decree loses effect from the beginning.
[2]The full text of the decree is available at https://www.gazzettaufficiale.it/eli/id/2020/04/08/20G00043/s
[3]The full text of the executive decree is available at www.uibm.mise.gov.it
[4]Reasonably, this does not include the substantive time limit for claiming priority laid down in international treaty (the Paris Convention). From a practical perspective, it is nevertheless likely that the Italian Patent and Trademark Office will embrace the EUIPO's approach and will therefore consider it to be included among the suspended time limits.
[5] In order to benefit from the suspension, no specific requests are necessary.
[6]The extension of the time limit of April to May 15 2020 provided for by Article 37 of Decree 23/2020 does not apply.
[7]The bill should extend the validity of certificates expiring between January 31 and July 31 2020 by 90 days after the final term of the emergency period declared by the government. This means that their valitity would be extended until October 30 2020.
[8] Article 83 of Decree No. 18 of March 17 2020, which set April 15 2020 as the final date of the suspension, has been amended by Article 36 of Decree No. 23 of April 8 2020, which postponed the date to May 11 2020.