Intellectual Property in the ECA Field and Protection of Consumers' Rights

T.B. Barabash

Practically in all countries of the world intellectual property in all spheres of economy is protected by patents and patent laws.

Paraphrasing Winston Churchill's comment on democracy, protection of intellectual property by patent laws may have many faults, but mankind still has not found anything better.

In fact, patent legislation systems of different countries are not similar, sometimes there is considerable difference between them, so, a patent acquired in one country, for instance in Russia, may interfere with obtaining a patent for an identical invention, say, in the USA, but cannot forbid using the invention in the USA if it is not protected by a national patent.

However, it should be noted that patent law provisions of different countries are in the process of gradual alteration and converging, particularly as regards interpreting the legislation norms. The fact that ever more countries join various associations working on simplification and standardization of patent acquisition procedure (PCT, EP) testify to there being no alternatives to patents, rights and based on them relations in the field of intellectual property protection and use.

When in the 1970s the first invention applications of V.M. Bakhir, Yu.G. Zadorozhny and their colleagues were forwarded to the chief patent authorities of the USSR, to All-Union Scientific Research Institute of Patent Expertise (VNIIGPE), the term "electrochemical activation" was not mentioned in protection papers ("electrochemical treatment" was used instead), since it was not common at the time.

In recent years this term has been widely used in patent publications. This fact alone proves that electrochemical activation became an independent trend of applied electrochemistry, and various teams of scientists in different countries research into it. Like any other branch of science having extensive field of application, electrochemical activation has become the center of not only conflict of scientific ideas, but also the conflict in the area of creating multi-purpose technical electrochemical systems for saline solution and water treatment. The present report is dedicated to the studies in this field, because such studies determine the engineering level of the products meant for further use by consumers.

It is worth mentioning that being the Head of the Patents and Licenses Department ( PLD ) of the Scientific and Research Institute of Electrochemical Technologies (NIIELCT), as well as the head of the patent team of the Department of Electrochemical Activation of the Russian Scientific and Research Institute for Medical Engineering under the auspices of the Russian Ministry of Health (VNIIIMT), I deal not only with patents and licenses, but together with technical experts of the PLD perform scientific, technical and patent expertise of various products manufactured using some patents in the sphere of electrochemical treatment of liquids. Another side of the activity of the above-mentioned institutions headed by me is preparing materials and participating in legal proceedings on law suits associated with illegal use of intellectual rights to ECA systems. Recent years' experience revealed definite tendencies in patent conflicts. These tendencies mostly stem from correct and incorrect patent policy and result in fair and unfair competition. Unfair competition obviously affects the end user of the product.

The most commonly accepted form of a guarantee of the right to be in charge of a technology is granting a patent both confirming the invention priority and indicating the owner of the invention. Besides, a patent is issued by state authorities which in most countries is a certain guarantee that the invention is new, is a real invention (i.e. not an evident compilation of solutions well known in the given engineering area) and can be applied in industry. The number of ECA-related patents grows every year and it is noteworthy that Russia holds the leading positions in this field. Due to certain patenting traditions, Russia cannot boast of record abundance of patents, but their quality is su-preme and the scope of problems they embrace is extremely wide. In this respect we should also mention Japan which is traditionally interested in new technologies, especially those associated with water and water solution treatment. Russia 's leading role intensifies severe competition in Russian patenting, as possessing Russian ECA patents is a definite investment guarantee for foreign investors.

In this review I am not going to discuss "correct" patents issued in compliance with the law and coming as a result of the authors' true creative engineering research, except for a situation when a patent issued absolutely legally can be called in question because different inventors could create the same invention independently of each other and in different time, or because of a possible error of patent authorities while issuing the patent.

The Russian Patent Law stipulates that a patent can be called in question throughout the whole period of its action and can be considered completely or partly invalid in cases of disparity between protected industrial property object and patentability conditions, in case if the invention's formula contains elements which were absent in the original materials of the claim or when the author (authors) of the patent or patent holder (patent holders) are indicated incorrectly.

For instance, Russian Patent Office issued two patents:

No. 2054386 for "A device for liquid's electroactivation" and No. 2057081 for "A method of liquid's electroactivation". In essence, both patents described non-contact activation, the technology and results of which long before filing applications for these patents had been reviewed in V.M. Bakhir's monograph "Electrochemical activation", Moscow, VNIIIMT, 1992, 667 pp. V. M. Bakhir handed in protests to Rospatent against these patents' issue on the ground of their non-compliance with a patentability criterion of novelty. The protests were satisfied.

I shall dwell upon some ways of obtaining patents, which can serve as examples of incorrect, and sometimes, to my mind, illegal, methods of entering the market with new products.

1. One of the most common methods is obtaining legal patents in compliance with the Patent Law, but using the Law's potential to by-pass a certain known patent. In fact, such patents are just a cover for using previously patented inventions. They can be called “representative” or “paper” patents.
2. Another method is not that common, though certainly more dangerous. It is a banal method of stealing intellectual property, accompanied with attempts to draw a veil of legality over this theft.
3. And, finally, there are attempts by individuals and legal entities to directly deceive the consumers. In their advertisements or accompanying documents of the product they often indicate patents having no relation to the products sold, present other owners' patents as their own or claim they got the patent holder's permission to use it.

Most patents are based on the preceding level of engineering and are actually essential (but not evident to an ordinary specialist in the field) alterations and improvements of the prototype's invention. The new result is received in the same sphere the prototype was meant for. Existence of several patents for inventions solving the same problem, but belonging to different patent holders, is a proof of competition conflict and requires careful studying of the whole lot of patent data. Otherwise the attempts to manufacture and sell the product according to the invention may lead to superfluous expenditures, impossibility to obtain the intended results and to court trials. I emphasize the fact that it is the patent data which should be thoroughly studied, since conducting comparative technical trials of different inventions, particularly in cases when highly intellectual progressive technology is meant, is not always possible.

1. First of all, one should pay attention to the authors or inventors indicated in a patent. This is one of the most important sources of information about the patent. True inventors are eager to bring their product to perfection, so gradual refining of their inventions is normal for them. Hence a series of patents, and each sub-sequent one is meant to upgrade the previous.

   For example, Japanese inventor Okazaki Tatsuo, also doing research into elec-trochemical activation, from 1983 proceeded with applications 58022461 (1983), 59198900 (1984), 62236869 (1987), 62294579 (1987), 63089993 (1988), 01098184 (1989), 02001377 (1990), 02418121 (1990), 04239058 (1992), 05107614 (1993), and they all are development and perfection of an electrochemical cell with coaxial electrodes; only in 1994, according to new applications, the inventor started designing a new project.

   Similar succession of applications is observed when we examine applications filed by V.M. Bakhir and Yu.G. Zadorozhny describing electrochemical elements (FEM-1, FEM-2, FEM-3 and FEM-4) and possible ways of their putting together into reactors (see pp. 233-251 of the scientific-technical review "Electrochemical activation: history, present state, prospects" edited by Professor V.M. Bakhir . Moscow , VNIIIMT, 1999, 256 pp. Illustrated. Authors: V.M. Bakhir, Yu.G. Zadorozhny, B.I. Leonov, S.A. Panicheva, V.I. Prilutsky, O.I. Sukhova).

   Apart from that, there is a vast number of protection documents (over 300), issued before 1989, in which V.M. Bakhir and Yu.G. Zadorozhny are indicated as the authors of the inventions protected in the USSR by Author's Certificates and in many other countries, by patents. These publications permit to follow the evolution of electrochemical activation development, as well as devices for its implementation and application areas: from using activated solutions in drilling machines in the 1970s, to application in medicine in the late 1980s.
2. Some information can be obtained from learning the name of the patent holder or the patent owner. Leaving aside the cases when the authors, or one of them, are patent holders, we can state that the legal entities which worked in Russia in this field are well known (see pp. 127.133 of the above-mentioned scientific-technical review). A Russian patent belonging to a foreign company, which does not work in Russia and is not registered in Russia , may testify to the fact that the given patent is not meant to protect a real invention, but serves "representative" purposes, and is an attempt to demonstrate high level of activity in this field.
3. And, finally, to estimate a patent, it is essential to examine the prototype's choice, the closest engineering solution solving the same problems as the invention protected by the patent.

 

We shall go on discussing "representative" patents by the example of RF patent No. 2104961, 1998.

1. The names of the authors (N.N. Naida, N.A. Pushnyakov) had not appeared previously in patent publications together, but the name of N.N. Naida is easily found in four or five earlier issued Russian patents in a group of authors headed by V.M. Bakhir and Yu.G. Zadorozhny.
2. The patent owner of the given invention is "Harrison Investments, Ltd", which is not present on the Russian market and is not registered in Russia.
3. The patent is dedicated to the development of a FEM-2 element. In conformity with the Patent Law of RF, it should be done at invention level. To achieve this level, in addition to introducing into the formula a number of elements not affecting the result, a simple method is used: the limits of possible parameter alterations in mathematical dependence indicating optimal ratios between the basic sizes of the interelectrode gap of a FEM-2 element are extended. The result is that by substituting declared values into the mathematical formula we can have a cell with an interelectrode gap measured in millimeters, but with the length in meters; or a cell with interelectrode gap measured in centimeters, but with the cell height measured in millimeters. It is evident that such cells cannot be made, and that the main goal of the authors was to circumvent the existing patent.

This also reveals an error of the expertise, which considered only formal differences from the prototype, but did not pay attention to the absurd combinations of declared parameters. By the way, the same mistake can be observed in the case of the first Russian patent analyzed in this report. Generally speaking, it should be noted that "invention level" as a criterion of patentability is mostly neglected in Russian patent authorities' practice, which resulted in the growing number of inventions protected while proceeding from the particular to the general, which contradicts the world practice.

 

Now, let us examine another method of using patents and other official documents confirming the quality of the product offered for sale. This method is widespread in Russia so far, though impossible outside Russia due to severe penalties for intellectual property right violation.

Printed advertisements of STEL-MT2 and STEL-10 devices manufactured by the firm NPO "Perspektiva" (town of Dubna, Moscow Region) indicate that the devices use the invention protected by RF application No. 94019403, i.e. the application for a FEM-3 element by the authors V.M. Bakhir and Yu.G. Zadorozhny is meant. The above firm has no rights whatsoever to use the element. Besides, the same advertisement points out that STEL-MT2 and STEL-10 devices are approved by the RF State Committee on Sanitary and Epidemic Control (No. 05 PC1928 of 10.07.91 ) and the Committee for New Medical Equipment of the Russian Health Ministry (No. 3 of 5.05.92 ), and have RF certificate POC.RU.EMO2.B00156 of 11.10.1994.

In fact, none of the documents cited above is related in any way to the devices advertised by the firm "Perspektiva".

NPO "Perspektiva" has no right to use RF patent No. 2078737 (issued in compliance with application No. 94019403) as the patent owners did not grant any licenses to NPO "Perspektiva", and any mention of the invention in the advertisement is in violation of the RF Law on Advertising and discredits the invention. Not long ago VNIIIMT of the RF Health Ministry got information according to which the STEL devices manufactured by the firm in question had been sold to consumers, i.e. to medical-prevention facilities (MPF). The information became available because of an MPF staff dissatisfaction with the quality of the device operation. Technical expertise revealed that the STEL devices were supplied with false FEM-3 elements, produced obviously in order to circumvent well-known patent No. 2078737, 1994, belonging to V.M. Bakhir and Yu.G. Zadorozhny. In particular, a solid rod electrode - the anode of an authentic FEM-3 element - was substituted by a tube of the same diameter with thread at its ends. Technical trials showed that the anode coating of this electrode does not conform to the standard. This "novelty" is far from being an invention. However, since the technology of anode coating is the authors' secret, is employed only by NPO "Ekran" (OOO "Let") and is unavailable to outside persons, the device fitted with false FEM-3 elements actually produced a solution whose parameters did not correspond to those of solution certified by the RF Health Ministry authorities.

Risk for consumers resulting from such "business" is evident. However, we are going to use all the rights given to us by the Law and contest "representative" and "paper" patents to prevent making this situation quite legal. We make this declaration, because it is quite possible that the patent authorities of Russia are already in the process of considering an application for a FEM-3 element, probably "enriched" with some pseudo-scientific elements, unimportant for the result. It is, naturally, titled in such a way and accompanied with a description made up in such a way that would mislead the expertise and allow procuring one of the types of patents discussed above. The ground for such a suspicion is the fact that the given firm has had experience of obtaining "representative" ECA -related patents. We do not examine this experience in the present review, because it is typical and in principle was described earlier.

 

Similar situation has emerged with distributing the STEL devices in Russia by the company OOO (Limited Liability Company) "MP Ecomed" ( Moscow ). These devices are known abroad as AQUASTEL or EUROSTEL, and are offered by a group of companies in different countries ( Switzerland , Germany , Ireland , Britain , Holland ) for distribution and sale. Advertising booklets describing the devices published in Russia contain data, exactly corresponding to that of legally certified the STEL devices manufactured by NPO "Ekran" and the companies which were granted the right to produce the devices by NPO "Ekran". The methodical recommendations on using electrochemically activated solutions synthesized by the authentic STEL devices received by other companies on a legal basis are also employed. The only difference is that in reality consumers get devices which have nothing in common with the authentic STEL devices (but the name). It has an electrochemical reactor with flat electrodes and a polymer diaphragm, which, of course, cannot guarantee obtaining solutions analogous to those produced by RFE reactors supplied with FEM-3 elements.

In foreign publications and on Internet sites, on the contrary, the history of electrochemical activation development is completely concealed, numerous inventions in this field are entirely ignored, and it is claimed that all mentioned association of various foreign companies started developing the most efficient in the world technology of electro-chemical activation in 1996, at the time of its generation. Our analysis proves that this lie is absolutely typical for most foreign companies, which do not wish to take into consideration international patent laws and use weakness of Russian patent laws and patent legislation for their purposes.

 

Let us conclude by examining another example of the same kind. NPO "Ekran" often receives letters and requests from different institutions and individuals, in which they ask why water purification devices bought from the company OOO "Emerald" with the following legal address: 3, ul. Kasatkina, Moscow , 129301, Russia (i.e. the address of OAO NPO "Ekran", VNIIIMT of the RF Health Ministry, NIIELCT) manifest poor manufacturing and operational properties (see, for instance, a picture of one of the EMERALD water purification devices made by OOO "Emerald"). One of the letters had attached to it Certificate of Compliance No. 01520763 for an EMERALD device to purify and decontaminate water. OOO "Emerald" received this certificate from authorities dealing with certification of machine-tool industry products, articles of general machine building and equipment for petrochemical industry (!?).

The story of relations between the two institutions: NPO "Ekran" and Joint Russian-British Venture SP "Emerald", each manufacturing household water purifiers IZUMRUD (EMERALD in English transcription) is closely connected with the new system of electrochemical activation ( ECA ) and, upon closer examination, with relations between people.

Joint venture SP "Emerald" (N. Djeiranishvili being its Director General) received the right to manufacture the EMERALD-M and EMERALD-C devices under license agreements with the patent owner V. Bakhir in 1993. However, Mr. Djeiranishvili made some secret attempts to sell the system abroad, though the agreements did not entitle him to do so, and that became a severe violation of the above-mentioned license agreements. In this connection, V. Bakhir, using the right assigned to him by these agreements, unilaterally terminated them on December 24, 1996 , and brought a claim to court to legally support his actions. Besides, it should be noted that the RF Civil Code enacted in 1994 did not stipulate such administrative and legal form of legal entities as joint ventures. In conformity with the law SP "Emerald" was to be re-organized or liquidated before July 1, 1999 . Instead, a new company OOO "Emerald" was established and registered in May 1995, the Director General of the new company remaining the same N. Djeiranishvili. The new company illegally calls itself the successor of the joint venture SP "Emerald" under the pretext that both companies have the same founders: on the Russian side the founder is the company "EPT", and on the British side - the firm "Kirk and Company International Limited", its director and owner being a British citizen Mrs. M. Kirk, N. Djeiranishvili's sister. However, one of the founders of SP "Emerald" was the small enterprise "EPT" (MP "EPT") co-founded by V.M. Bakhir and Yu.G. Zadorozhny. As for OOO "Emerald", its founder is TOO "EPT", in fact, a different enterprise headed by N.V. Djeiranishvili's wife.

By the way, the legal address of OOO "Emerald" is, obviously, also registered with violations of the laws which were in force in 1995, because NPO "Ekran" never gave such a permission. The NPO "Ekran" top managers learned about the fact of unsanctioned use of the legal address only in August 1999.

In our opinion, all this activity resulted in stealing a certain part of Russian elec-trochemical activation system by Russian citizens (Djeiranishvili and others) and British citizens (M. Kirk and others).

These persons deceived not only inventors V.M. Bakhir and Yu.G. Zadorozhny and the staff of NPO "Ekran", who have been working together for over 25 years in the field of ECA engineering and technology development and collectively have more than 600 inventions and foreign patents in this area. They also deceived the people to whom they sold intellectual property which did not actually belong to them, claiming they had the right to use it. The situation has brought about three trials - in Russia , the USA and Great Britain . In Russia , the defendant (SP "Emerald") tries this way or another to avoid legal proceedings, dragging out the examination of the case on its merits under various pretexts.

 

Based on the foregoing I would like to draw the following conclusions:

1. Electrochemical activation proves to be a highly promising technology as numerous foreign companies, on their own or through certain Russian companies and private persons, by all means try to take possession of at least part of the intellectual property originating from a big team of researchers under the scientific direction of V.M. Bakhir.
2. Unfortunately Russian Patent Law and practice of reference to the court on infringement of intellectual property is far from being perfect, and in fact requires change. Hopefully in the third millennium justice in this context will prevail.
3. Buyers of the ECA production and potential investors should regard carefully new products in the area of electrochemical treatment of water and solutions offered to them by unknown people or companies and should ascertain nature and origin of such products.

 

Published in the Papers of the Second International Symposium on Electrochemical Activation (Moscow, VNIIIMT, 1999), edited by author in 2005.