Episode 39
Between late May and early June, a particular book became a hot topic within the patent attorney community: *"Everything About Inventive Step for Patent Practice"* The authors are eight patent attorneys, all with backgrounds in science and engineering, and the supervisor is a lawyer with a similar science/engineering background. Although a bit late to the party, I borrowed a copy from the library to take a look (though I did not read it thoroughly). In Section 1-2 of Chapter 1, under the heading "Basic Concepts Regarding the Determination of Inventive Step," the book simply copies and pastes the JPO's Examination Standards regarding terms such as "person skilled in the art," "construction of logic (logical reasoning)," "common general knowledge," "well-known or commonly used art," and "state of the art." It appears the authors and supervisor believe that discussing "inventive step" is synonymous with copying and pasting the Examination Standards. Additionally, in "Column 3: Hindsight," the book cites and explains the Examination Standards; however, the underlying basis for this is a specific Intellectual Property High Court judgment (IP High Court Case No. 2008 (Gyo-Ke) 10096, decided January 28, 2009). Incidentally, "examination standards" are defined as "standards necessary for determining, in accordance with the provisions of laws and regulations, whether or not to grant a license, approval, or the like requested via application" (Article 2, Item 8(b) of the Administrative Procedure Act). It is generally understood that these examination standards do not possess the force of law or serve as binding norms for judicial decisions (Source: *Article-by-Article Commentary on the Administrative Procedure Act [Updated for the Revised Administrative Appeal Act]*; edited by the Center for Administrative Management Research). Regarding this matter, the Supreme Court has held: "Even if an administrative agency establishes guidelines for the exercise of discretionary power regarding matters entrusted to its discretion, such guidelines are essentially intended to ensure the propriety of the agency's dispositions; therefore, even if a disposition is made in violation of said guidelines, the issue is, in principle, merely one of propriety or impropriety, and the disposition is not automatically rendered unlawful. A disposition becomes unlawful only when it exceeds the scope of discretionary power permitted by law or constitutes an abuse thereof, and only in such cases may a court revoke the disposition; the provisions of Article 30 of the Administrative Case Litigation Act merely clarify this principle." (Supreme Court Grand Bench Judgment, October 4, 1978; Case No. 1975 (Gyo-Tsu) 120; *Minshu* Vol. 32, No. 7, p. 1223). In other words, it goes without saying that examination standards are not legally binding on the courts; nor are they legally binding on examiners or trial examiners. Consequently, even if an examiner or trial examiner reaches a conclusion that differs from the examination standards, that fact alone does not render the decision unlawful. Lawsuits seeking the revocation of a trial decision are subject to the Administrative Case Litigation Act (Article 67, Paragraph 3, Item 9 of the Patent Act). Therefore, the subject of judicial review in such a lawsuit is not whether the decision made during the trial proceedings conforms to the examination standards, but rather whether the decision exceeded the scope of discretionary power permitted by law or constituted an abuse thereof (Article 30 of the Administrative Case Litigation Act). While it may be permissible to cite examination standards when presenting counter-arguments during the examination stage, one should cite judicial precedents or court rulings—rather than examination standards—when presenting counter-arguments during the trial stage. This is because if an administrative appeal results in a decision to reject an application, and that decision is subsequently overturned in a lawsuit seeking its rescission, it reflects poorly on the administrative judge's performance evaluation. Court rulings fall into two categories: *hanrei* (binding precedents) and *saibanrei* (judicial precedents/court decisions). The term "*hanrei*" refers to a judgment containing a legal interpretation applicable to other cases; a judgment that merely sets forth reasoning specific to the case at hand does not qualify as a *hanrei* (Supreme Court Decision, First Petty Bench, Feb. 12, 1953; Case No. (A) 3474 of 1951; *Keishu* Vol. 7, No. 2, p. 211). In other words, whether a judgment was issued by the Supreme Court, a High Court, or a District Court is irrelevant to the distinction between *hanrei* and *saibanrei*. There are *saibanrei* issued by the Supreme Court and *hanrei* issued by District Courts. However, only Supreme Court *hanrei* (or, in their absence, *hanrei* from the High Court that heard the appeal) may serve as grounds for a petition for acceptance of a final appeal (*jokoku*) (Article 318, Paragraph 1 of the Code of Civil Procedure). Notably, there is only one Supreme Court judgment addressing inventive step: ・Supreme Court Judgment, Third Petty Bench, August 27, 2019; Case No. (Gyo-Hi) 69 of 2018; *Shumin* No. 262, p. 51. When discussing the inventive step of a patent, one must first identify *hanrei* from among the various intellectual property judgments; however, it is difficult for a non-lawyer to distinguish *hanrei* from the vast number of court decisions. Therefore, to benefit from expert legal insight, one should refer to the following article: "Considering Inventive Step" by Makiko Takabe (*Patent* magazine, January 2022 issue) https://jpaa-patent.info/patent/viewPdf/3931 The author of this article is an expert in intellectual property litigation who served as the Chief Judge of the Intellectual Property High Court and as a Supreme Court Research Official.