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I have developed a technology that will keeps fruits in storage and transport from spoiling prematurely. The problem is global in nature which means that I have to be mindful of where my markets are and protect my IP accordingly.

One of the sectors giving me problems from an IP perspective is trans-ocean shipping because the goods (and my technology) moves from one port to another. I am interested in how jurisdiction is determined and how/where I am exposed if I do not protect adequately. I cannot sensibly patent every nation in the world and I am trying to be strategic about which nations I enter into at national phase.

A potential scenario is this: a shipping container full of bananas is loaded in one nation, bound for another. My inventive device is onboard the shipping container and is owned by the ocean transport company. The invention operates the entire time the bananas are in the shipping container which includes it being loaded onto a ship at Nation A, traversing international waters, and then being off-loaded at Nation B and delivered to a distributor somewhere in Nation B. It is even possible that the container is transshipped from Nation B to Nation C.

Lets say the bananas were loaded in Ecuador and bound for Belgium and the ocean transport company is multinational and has offices on every continent. Should I just protect Belgium because the goods will be landed there or do I need to protect both Ecuador and Belgium? Does the boundary into international waters act like a reset button on jurisdiction or anything like that? Does the multinational reach of the ocean transport company factor into consideration? Should I have broad coverage through the EU to project against transshipments to surrounding nations?

I know just enough about IP to get myself in trouble but nowhere near enough to get myself out of it. I'm really hoping that you might help me understand this type of situation better so that I can plan accordingly.

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The following is a general overview and not legal advice.

Each country is different, but as a general rule patents are geographical and you sue in the country where you have a patent.

More important, you usually sue for patent infringement where it is easy to sue and collect damages. So you could sue in Ecuador, Belgium or in Germany (assuming that is where the bananas end up). But only if you have a granted patent in the country where you want to sue. Below I will explain where you probably should sue.

Taking the USA as an example, 35 USC 271 says (among other things): "Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent."

Who enforces this law? Basically, the customs services is supposed to stop importation. Once an item is imported, most countries allow you to file a civil suit. There are some unique exceptions. For example, China has special outbound custom activity preventing export of items infringing IP.

One more law to consider, the Paris convention, specifically article Article 5ter, which says that "the use on board vessels of other countries of the Union of devices forming the subject of his patent in the body of the vessel, in the machinery, tackle, gear and other accessories, when such vessels temporarily or accidentally enter the waters of the said country, provided that such devices are used there exclusively for the needs of the vessel", with something similar for land vehicles and airplanes.

So, arguable, a device for maintaining the freshness of bananas, might not be infringing anywhere, as long as it is in transit (I am sure there is case law, but I have not looked it up and it is probably country-specific). Also, a company based in the USA does not infringe a US patent if activities only occur outside the USA.

The European union is about to enact a unified European patent system, simplifying your choices in Europe (single patent, single court).

Back to your question. Usually, one files where there are large infringers, where suing is cheap, where market is large, where the courts are pro-patent, where your competitors are located, where there are weak infringers (who cannot fight back) or where you expect licensing revenues (this is not an exhaustive list). Most important, you should consider the cost of actually prosecuting the patent to grant in each country (figure $5k a year until grant and $500 a year after grant, per country.

Keep in mind that international patent litigation is very expensive, so you should consider if it will pay to enforce. For example, a $1M (cheap!) patent lawsuit in a country with a $10M a year infringement value and where courts are unfriendly (to patent holders, outsiders), is not a great investment.

So, how likely are you to prevail in Ecuador? How much bigger is market in Germany than market in Belgium? Must infringers use the port in Belgium? Where is suing easier? where is device not "in transit" any more. On the balance it looks like Germany would be the place to file a patent, as device may not be in transit any more, and Germany is a large market and suing is easy. First, of course, I would check how your device is used in Germany and what law says about such use.

If you are lucky, the technology causes a novel change in the bio/chemistry/structure of the fruit itself and then you may be able to patent this modified fruit and sue for infringement of a patent on the modified fruit, rather than directly on the technology. The fruit is just sitting in the supermarket, not in transit and cannot "hide" from you.

p.s., method patents in the USA, for example, even if infringed only outside the US, can sometimes bar the importation of the result (fresh banana?) into the usa.

  • Thanks very much for taking the time. I think what I am worried about is being knocked-off by a country for which I have not applied for patent protection and having their devices compete with mine in markets for which I have applied for patent protection. From what you've suggested, the situation isn't conclusive because it can be argued that the inventive device may or may not be imported with the fruit(which is the actual shipment). I think my concern speaks to one of your primary points about patenting where you expect infringement and so I will think on that as I revise my plan. Thanks! – Jim Sawada Nov 23 '18 at 2:40
  • “provided that such devices are used there exclusively for the needs of the vessel“ a storage container is not needed exclusively for the vessel (other than a motor or sail for example). – DonQuiKong Nov 23 '18 at 14:40
  • @DonQuiKong, i will now quote the part about trucks and we can decide if a court could argue what "the operation" means:"(ii) the use of devices forming the subject of the patent in the construction or operation of aircraft or land vehicles of other countries of the Union, or of accessories of such aircraft or land vehicles, when those aircraft or land vehicles temporarily or accidentally enter the said country" – tilnow Nov 24 '18 at 16:03
  • @tilnow in my opinion (don't have case law), that would be only integral parts. It might even be that transit doesn't include doing business in a port. – DonQuiKong Nov 24 '18 at 18:32
  • found this review. repository.law.umich.edu/cgi/… page 19 quotes "national steel car II" where a railcar specifically designed for the transport of lumber enjoyed this exemption. – tilnow Nov 25 '18 at 15:58
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It seems the long question and the long answer as well are off beat. To me the relevant aspects are

i. Q. What is the patent protected product ?

A. A storage device. (And not bananas or any other fruit it stores).

ii. Q. Will its entry to another country as a fitted device of a vehicle can be considered as infringement of patent in that country ?

A. No.(The answer of 'tinlow' quotes some related international law). Because, in simplest of terms patent protection is for production and selling in a country in which patent is obtained. The vehicle or its fitments will not be considered indulging in these activities while carrying out normal shipment activities.

iii. Q. Countries of interest for the product.

A. The legal aspect of patent protection is confined to patented product which is, in this case, a storage device. Since this device is to be used on ships, the inventor can concentrate on countries capable of building ships. And number of countries having ship building capability is limited.

iv. Q. Will selling of banana and for that matter any fruit which were stored in your invented container can land you in patent infringement suit ?

A. Unless you intend to manufacture and sell your storage device in that country you need not worry. Selling of bananas and fruits are related to trade (export-import licenses) law and not patent law.

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    I disagree, a patented device entering a country might be considered infringement in that country, whether it is used or not, if it is being imported. Plus, if there are bananas in it, it is being used. Therefore any country where the storage decide might enter is interesting. – DonQuiKong Nov 23 '18 at 14:37
  • I have to comment on "Q. What is the patent protected product ?", as my point is that you should choose the subject of the patent according to who and where you want to be able to sue. – tilnow Nov 24 '18 at 16:04
  • Internationnal Shipping Process has a destuffing arrangement at port of destination where containers are emptied and handed back to shipping company. I think concern of shipping company for their tangible property helps IP right tangle in a great way. – AD Adhikary Nov 25 '18 at 0:27

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