Newsletter Edition 07 - October 2019


An IP Honorary Member

Lawyer Luiz Leonardos wrote his name very early in the history of Intellectual Property in Brazil. At 15 he was already working at his father’s office, Thomas Othon Leonardos, and three years later he graduated as an industrial property agent accredited by the BPTO (Brazilian Patent and Trademark Office). Founder, alongside other peers, of ABPI (Brazilian Intellectual Property Association), as well as former president, president of honor and member of the board of directors, Luiz Leonardos is a member of several international IP institutions. At the end of the 1960s, he joined the Brazilian delegation at the Stockholm Conference of the Paris and Berne Conventions (at which time the WIPO was created). He does not miss any AIPPI meeting, entity of which he is a former executive president and is an honorary member.

At 84, Luiz Leonardos maintains the daily routine in the office that since 2012, after a split, takes his name. Below you will find the best excerpts from the interview he gave at his office in a work break. In a good mood and with a great memory he addressed various topics on the IP agenda, including patents, the Madrid Protocol, Schumpeter, and artificial intelligence.

 An annoying teen in The Night

“When I was 15 and a teenager or an annoying teen, working was a way of clearing the air at home. I started in my father’s office, which joined Momsen and became the Momsen, Leonardos and Cia office, dedicated to Industrial Property and corporate law. I worked in the bureaucratic area, carrying papers, etc. In 1953 after graduating from high school I went to Law School. During the course, I took the Industrial Property Agent exam. I was 18 years old and already emancipated since by the Civil Code of the time the legal majority was only 21 years old. From then on I got into IP work.

At the time our office was in The Night Building, in the Mauá Square (Rio de Janeiro), where the BPTO (Brazilian Patent and Trademark Office) operated for many years. When the BPTO became part of the Ministry of Industry and Commerce, the government took the building back, which always belonged to the Union. Then we left The Night Building, but we would always stick around the same area.

 Substantial Entrepreneurs at ABPI

Today, of the founders of ABPI, we are only three survivors, Peter Siemsen, Geraldo Dannemann and me. As a matter of course, in this age group, few are still active. It turns out that in our business intellectual property is highly internationalized. We used to attend AIPPI (The International Association for the Protection of Intellectual Property). At the Paris and Vienna circuit, which was the center of the Austro-Hungarian empire, at the beginning of the twentieth century, it was agreed that the Brazilian Association for the Protection of Intellectual Property – ABPPI should be founded as the national group of AIPPI. Today, by the name of ABPI (Brazilian Intellectual Property Association) it is an important AIPPI national group, just remember that we have already held two AIPPI congresses in Brazil.

ABPI started with substantial presidents in the Brazilian business scenario. The first was our late Mauricio Vilela from the Vilela Laboratory, followed by Guilherme Vidal Leite Ribeiro from Klabin Cellulose. ABPI has always had a mix of companies and law firms, such as ours at the time, Dannemann, Daniel and others. This composition remains to this day, with the presence of offices and many companies that are ABPI members. This is important. Companies need protection, and ABPI is a center for debates, studies and forwarding intellectual property issues in Brazil. It is an entity recognized by the Legislative, Executive and Judiciary powers.

Initially, ABPI congresses were held every three years, then went on for two years until they became annual. There are always panels with entrepreneurs, professionals, and magistrates, which is of the utmost importance since there is an exchange of understandings, appreciations of legal theses that will be applied later in court proceedings.

 The BPTO is an old problem

The fact that the DNPI (National Department of Industrial Property) became an autarchy, namely the BPTO, did not lead to what we thought or dreamed at the time, that is, an increase in the administrative capacity of the entity. You can see that this is an old problem. They set up this office to conduct a thorough examination of patent applications, a more complex process than the examination of trademark applications, but not equipped with well-trained examiners. Note that today, to be a BPTO examiner, the candidate is required to have a master or doctorate in the technical field, which is correct, it works this way all over the world. But the fact is that the BPTO has never been sufficiently equipped to perform its functions.

In his treaty of commercial law, Carvalho de Mendonça, an old commercial lawyer, already said that the effectiveness or success of the protection of industrial property, with this thorough examination, especially of patent applications, depended essentially on the ability of the public office to perform its role successfully. As this has never happened in Brazil, hence we have this huge backlog of patent applications.

To this day, to cope with the workload at the BPTO, it would be necessary to hire more patent examiners. But Brazil has been going through a period of great economic and financial constraints.

It is true that past and current BPTO management leaders have worked hard and are still working hard to counter the backlog. The current administration’s measures, continuing those already being adopted in the previous administration, are beginning to take effect, allowing the BPTO to release patent applications more quickly. Trademark applications are quite up to date.

Autonomy: it is in the Law

What was expected by turning the DNPI into an autarchy – and which is authorized in the current Industrial Property Law – is that the entity would have administrative and financial autonomy. But the government has never implemented this, and it returns a sum that is never equivalent to what was collected. If the BPTO’s collection could remain with the BPTO itself, it would probably have the resources to perform successfully and independently. By the way, there are bills in Congress complementing the current law, stating that these resources should always remain with the BPTO, that it should not be collected for the Treasury. Thus, the BPTO would be able to accelerate patent examination, which in certain areas may take up to 12 years to be granted. It sounds incredible, but Mechanics is one of the most time-consuming fields in patent examination.

Madrid Protocol

International trademark registration, which will now be done in Brazil through the Madrid Protocol, may not come out as cheap as it has been touted, as there are numerous fees levied at several procedural stages. A Brazilian wishing to protect his trademark within the more than 120 signatory countries of the Protocol will have to apply in English or Spanish. He will pay both the BPTO and WIPO fees and any other country where he wants protection.

There are certain provisions of the treaty that conflict with our industrial property law. One of the items that the Industrial Property Law (Law 9.279/96) has implemented rigorously and aims to protect national businesses is that contained in Article 217, obliging the foreign applicant, either in the registration of a trademark or in a patent application in Brazil, to have a Brazilian prosecutor empowered to receive service in the administrative area or for judicial proceedings. Previously, anyone wishing to carry out a legal action in Brazil for a trademark or patent registration against a foreign owner had to follow a procedure called letter rogatory to the country of origin, so that the applicant could be summoned and respond to the case in court in Brazil. It was a lengthy process, and some countries, such as the United States, hardly accepted these letters rogatory.

Interestingly, the United States has recently amended its Trademark Act to oblige a foreigner seeking to register a trademark there, including via the Madrid Protocol, to constitute an American prosecutor. Brazil should take this example and apply what is already in its law.

 Fallacies in Geographical Indications

There is a fallacy in saying that Geographical Indication would only be protected by this agreement between Mercosur and the European Union. The old Paris Convention of 1883 was already talking about the protection of Geographical Indications, at the time called Indications of Origin. In parallel to the Paris Convention, another treaty was approved, which is also from Madrid, but should not be confused with the trademark registration one. It is from the late nineteenth century and deals with the protection of false indications of origin.

 Schumpeterian innovation

Industrial property has always been contemplated in Brazilian constitutions, except that of the Estado Novo (New State). But as soon as we returned to the democratic regime in 1946, the constitution of the time again included the protection of industrial and intellectual property in general. Subsequently, the following constitutions, even those of the time of the military regime, explicitly provided for the protection of industrial property, as contained in the current 1988 Constitution.

There was a misunderstanding of Intellectual Property, but it wasn’t just in Brazil. Internationally there has also been very strong criticism of this patent protection system. One of the greatest proponents of the economic theory of the patent system, economist Joseph Schumpeter, spoke of the process of creative destruction, in which one innovation is being replaced by another, just as it has been happening. Note that in his time computers were not even considered, let alone artificial intelligence, a topic widely discussed in these industrial property associations.

From its theoretical conception, all protection of industrial property is to favor investment and, for that to happen, what is required is a guarantee, which is the exclusivity established by the patent. But it is also necessary that, in practice, a country’s economy is ready to attract this technology and apply it industrially and commercially. There is already a lot of inventions developed in Brazil, but comparing worldwide, the number of patents originated in the country is still very small.

Intelligence has an owner

In the case of artificial intelligence, the big discussion is about who should own the intellectual property rights. The computer is programmed to act in a certain way. Who should be protected? What created that program that makes the computer work in a certain way or the system that already makes the computer work in its own way? Who would own the technology? This is generating great discussion in the international forums, and we will see where it will end”.