Research On The Risk Of Patent Being Declared Null And Void During The Capitalization Of Patent

Intellectual property rights including copyright, trademarks, patents, etc., belong to the category of intangible assets, which is the innovation of the "property of dematerialization revolution" since the Roman law system. Capitalization of intellectual property rights means that the intellectual property rights are regarded as a special form of investment capital into industry. Early capitalization is mainly concentrated in the fields of copyright and trademark for the reason of relatively more stable and more predictable of the value. But patent has become the latest must-haves in the market because of its higher value and industrialization ability. Specifically, patent capitalization refers to the patentee quantification for capital of the intellectual property rights to invest or transfer and other activities, together with the other factors of production directly involved in the whole process of economic activities such as production, investment and allocation. There are mainly three financing forms of patent capitalization such as patent securitization, patents investment and patent pledge, which are based on the license or transfer of patent. Though patent capitalization has been developing in full swing and our government also has issued relevant policy support, patent industrialization rate is still low in our country(only 10%), showing "the government and enterprises active, financial institutions and investors fear back ". One of the important reasons is that patent value has not been so stability, even with the risk of patent right being declared null and void: patent investors would take the risk of the patent being declared null and void at any time. Another is the policy option of "trading order priority" of the Article 47 of Patent Law has deepened the investors. This paper is focusing on how to reduce the risk of patent being declared null and void and how to eliminate the influence of the patent being declared null and void.Besides the introduction and conclusion parts, this paper is containing the following four parts:In the first part, the inevitability of patent being declared null and void during the capitalization is discussed. Though the forms of patent capitalization such as patent securitization, patents investment and patent pledge are more advanced forms of patent utilization, patent industrialization rate is still low. Patent "a presumption of rights", not so reasonable "patent incentive mechanism", the inadequacies of patent review, fuzziness of the authorization standards have all proved the inevitability.In the second part, the rules of risk of patent being declared null and void in United States, Japan and China are studied. Throughout laws of United States, Japan and our country, we basically used the rules of United States about risk "Once Patent later proved invalid, the licensees don’t have to pay back the patent licensing fees unless fraud or express effective guarantee being proved" and abandoned the unjust enrichment rules of Japan "Unless otherwise specified, the return to unjust enrichment".In the third part, the impact of the legal control of risk of patent being declared null and void on the patent capitalization is specifically stated. In the patent securitization situation where patent in the asset pool was declared null and void, patent licensee will bear the risk because the promoter does not assume the liability for guaranteeing the drawbacks or repurchase, or change the underlying assets and the SPV institutions will not be able to repay capital with interest to investors. In the situation of patent investment, the patent "trading order priority" policy choice was conflicted with "the doctrine of capital maintenance", Shareholders "the doctrine of defective capital contribution" in Company law. In the patent pledge situation, the rule of non-retroactive has a conflict with the function of mortgage ensuring the creditor’s rights achieved and Financial Institutions undertake the risk of creditor’s rights not being achieved.In the four part, countermeasures of adjusting the risk of patent being declared null and void on the patent capitalization is put forward. Criticising and abandoning the ideas of Mark A. Lemley "relying on the procedure of patent invalidation, litigation to fix the authorization of invalid patent" with patent licensing program reducing the possibility of the authorization of invalid patent. Easing and resolving the adverse consequences of patent being declared null and void with "adjusting of scope of law ", "effective date of invalid patent ", "doctrine of estoppels ", " policy leverage " to fix the impact of patent "trading order priority" policy choice. Moreover, the factor that patent would be declared null and void need to be introduced into existing evaluation method so that the artificially high patent value could be eliminate to reduce risk. In the end, building "a kind of insurance of risk of patent being declared null and void" system to reasonably allocate the risk. Only in this way can the patent capitalization operation has vigorous development.