Patent Law and Space-Bound Inventions: The Conundrum, and Strategies for Combating It

Introduction

As private companies increasingly pioneer space innovation, the spotlight on intellectual property protection beyond Earth’s atmosphere intensifies. Patent laws serve the crucial role of defending against theft and promoting development. With the expanding space tech market, the latest challenge becomes enforcing patents beyond Earth's boundaries.

Patents provide territorial rights. A Canadian patent, for example, provides protection against infringement within Canada (subject to certain exceptions). Accordingly, patentees must consciously select jurisdictions in which to file their patent applications, based largely on the potential for commercial exploitation in the chosen jurisdictions. There is no worldwide patent.

Flags of Convenience

Outer space exceeds the boundaries and jurisdiction of any country.^[1] It follows, then, that use of patented technology in outer space is presumptively non-infringing. Furthermore, space companies may establish themselves in almost any country, and advances in launch technology and domestic capabilities are broadening the number of countries suitable for launch of spacecraft. This gives rise to the problem of “flags of convenience,” which presents an additional barrier to the protection of inventions designed for use in outer space.

As is the case for Antarctica and the high seas on Earth, state assertions of sovereignty may not be valid in outer space. The law of the seas gives vessels the choice of submitting themselves to the jurisdiction of a country which may be different from that of their territory of origin or commercial activity.^[2] In this bargain, the “convenience states” enjoy increased commerce while vessel owners enjoy the benefits of the chosen jurisdiction, such as a relaxation in taxes, labour costs and other regulations by virtue of flying the state’s flag. This practice is known as flying flags of convenience, and it may have implications for patent enforcement in the context of space-bound objects and the treaties that govern them.

Space Treaties

There are five major international treaties that specifically address the legal framework in space. They are known colloquially as the Outer Space Treaty,^[3] the Rescue Agreement,^[4] the Liability Convention,^[5] the Registration Convention^[6] and the Moon Agreement.^[7]

The Outer Space Treaty establishes outer space as res communis – a common area that all can explore but none can appropriate. Based on the treaty, use or occupation of any portion of outer space or a celestial body by one nation cannot hamper the free access of another to the same resource. In stark contrast, patent laws are generally exclusionary in nature, preventing others from unauthorized use of patented inventions for limited periods of time. These opposing principles present a conundrum for holders of patent rights over inventions destined for space; what laws apply up there?

The Outer Space Treaty and the Registration Convention, each ratified by Canada, together provide a step towards patent protection in space, but may not get us all the way there. Art. VIII of the Outer Space Treaty establishes that “a State Party … on whose registry an object launched into outer space is carried shall retain jurisdiction and control over such object… while in outer space or on a celestial body.” The Registration Convention provides the means for this registration and requires a state launching a space object to register the space object on a registry maintained by it, and of which the Secretary General of the United Nations has been informed.^[8] This permits a launching state to retain jurisdiction and control over a space object it launches to space. While such jurisdiction and control may not explicitly extend terrestrial patent laws to infringing activities in space, signatories to the Outer Space Treaty and the Registration Convention may enact domestic laws that apply their patent laws to activities in space concerning space objects under their jurisdiction and control. To date, the United States is the only country to have explicitly done this. Germany, through modification of its patent law prior to its ratification of the 1988 Intergovernmental Agreement (IGA) concerning co-operation on the International Space Station, applies its patent law to space objects registered by the European Space Agency (ESA).^[9]

Section 105 of Title 35 of the United States Code regarding inventions in space provides that “[a]ny invention made, used or sold in outer space on a space object or component thereof under the jurisdiction or control of the United States shall be considered to be made, used or sold within the United States.”^[10] There are two exceptions, including where the space object or component thereof is specifically identified and otherwise provided for by an international agreement to which the United States is a party, and where the space object or component thereof is carried on the registry of a foreign state under the Registration Convention. In other words, U.S. patent law governs a space object that is carried on the registry of the United States of America but may not so govern where otherwise agreed by an international agreement. Further, it would appear that an entity may be able to avoid infringing a U.S. patent by taking advantage of the “flag of convenience” loophole and registering a space object in a jurisdiction other than the U.S. and, in particular, where there is no patent protection for the invention.

Strategies for Patent Protection

Flags of convenience present a unique and pressing issue for companies looking to safeguard their space-bound intellectual property. However, several strategies can be employed to combat this emerging challenge:

• Focus on Earth-Based Infringement: It is generally difficult to monitor space activities. A patent covering a method carried out in space would therefore be difficult to enforce, not just for the reasons mentioned above but also because infringement would likely not be readily detected. Focusing patent protection on the space object itself (i.e., the product per se), or even a method of manufacturing the space object, would capture infringing activity here on Earth, when the product is made, used or sold, even if later used in space. This strategy shifts the point of contention from space (where jurisdiction is nebulous and infringement detection is difficult) to Earth (where patent laws are enforceable and detecting infringement is far less difficult).
• Strategic Jurisdiction Selection: Seeking a terrestrial form of patent protection does not address the fact that infringers may manufacture space objects and launch them where there is no patent protection (the “flag of convenience” loophole). While a Canadian patent is enforceable within Canada, space companies should also consider obtaining patents in other key jurisdictions where significant space activities, such as manufacture or launch, are likely to occur. This includes major space-faring nations like the U.S., China, Russia and members of the European Space Agency, as well as any other countries well-suited for manufacture or launch of space objects, due, for example, to technological advancement or domestic regulations. There are multinational forms of patent protection that would facilitate this strategy. For instance, a European Patent, once granted, can be validated in any of the 39 European Patent Organisation member states, plus five other states. This means that with a single application, companies can potentially secure protection across a vast region. Europe now also offers a single Unitary Patent, which offers uniform protection across all participating EU member states. This eliminates the need for individual validation in each country, providing a more streamlined and cost-effective approach. (There are benefits and disadvantages to each approach, that are beyond the scope of this article). The Patent Cooperation Treaty (PCT) also provides a streamlined application process for many countries around the world, which could represent a cost-savings versus individual filings at the national patent offices of each country, depending on the number of countries in which protection is sought.

Conclusion

Patent laws, rooted in territorial boundaries and exclusionary rights, are generally at odds with the boundless expanse of outer space and its designation as res communis under the Outer Space Treaty. While certain factors, such as flags of convenience, present complexity, there are strategies that can be employed to obtain more effective patent protection over space objects.

The Space Tech Group at Aird & Berlis LLP has the knowledge and experience to assist space technology companies in leveraging these strategies.