Naked Law

Mental arithmetic ...

Recently I came across the judgment of Floyd J in Kapur v Comptroller General of Patents, Designs and Trade Marks [2008] All ER (D) 142. Mr Kapur wanted to get a patent for a new way of recovering documents which had been deleted from or overwritten on a document management system. The application for the patent (which (if successful) establishes the scope of any patent protection that is ultimately granted) couched the new method in terms of a computer system only.

The issue arose because the law, as implemented in the UK by section 1(2) of the Patents Act 1977, says that certain things are to be excluded from the “patentable inventions” category. The list includes:

“(c) schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers; and (d) presentations of information".

For those of you who have been following these cases, you’ll remember that the Court of Appeal, in the Aerotel case in which it was trying to decide how to apply section 1(2), came up with a four step test of patentability:

1. Properly construe the scope of the patent applied for;

2. Identify the “new” contribution the invention makes to the field;

3. Ask whether the invention falls solely within the categories excluded by section 1(2); and

4. Check whether the invention meets the requirement for the invention to have some “technical effect”.

So, the court in Kapur duly attempted to apply this four-step test, and, in doing so, it had to look at whether the invention was excluded on the grounds that it was a “method for performing mental acts”.

In previous case law, this had been interpreted both widely and narrowly. Should the exclusion from patentability be narrowly restricted, to methods actually carried out by the human mind, or should it be widened so as to include methods of the kind carried out by the human mind even where in practice it is a computer which carries them out? The judge decided that the narrow interpretation was the correct one. Provided that any patent granted with this scope could not be infringed merely by a third party himself performing some sort of mental act, the exclusion would not apply.

The case is interesting in that it confirms that the courts are minded to construe the “mental act” exclusion narrowly, which is good news for patent holders as they, at least in respect of this exclusion, have a better chance of obtaining the patent if the exclusion is more narrow. Of course, the pragmatic conclusion is that it’s likely that many inventions of this kind are likely to be excluded under the “business method” exclusion in any event, but that is a whole new post in the making!

Searching for the truth

There has long been a belief in the independence in the English Courts. Probably those elsewhere in Europe characterise this as bloody mindedness, as yet another decision diverges from the European norm. Colin Birss QC, who appeared on behalf of the Treasury in the Astron Clinica case I have just posted about, shed a rather different light on the matter in a recent talk (18 Feb 2008) at the Queen Mary Intellectual Property Research Institute (QMIPRI), drawing on the saga of patentability of computer software.

English Courts try to follow what they understand the law as interpreted by the European Patent Office to be; they then state this law in a relevant decision. However, the European Patent Office then changes its view of the law, but the English Courts are bound by their earlier decision.

This explains the bumpy ride software patents have had in the UK, and that there is (in theory at least) still a difference between the UK courts and the European Patent Office on what is patentable, as reflected in the English decision of Aerotel v Macrossan. What can be learnt from this analysis is that one cannot be certain what is patentable; even if it is (or is not) now, that may change. Which is good for lawyers but not necessarily good for innovation and those who have to invest in patents. Of course patents are not alone in creating uncertainty – there are plenty of other happenings in, for example, the internet arena which make innovation in this area exciting from a legal perspective.

Treading softly where the European Patent Office boldly go

In another case in the saga of whether software is patentable, the UK Patents Court has attempted to close the gap between UK case law and the European Patent Office by confirming that software, on its own, whether or not recorded on a recording medium or operating in a computer IS PATENTABLE, apparently defying a common sense in interpretation of the words that “computer software” is not patentable “as such”.

In a sleight of hand, which surely has more in common with an unpatentable business method or playing a game, David Kitchen J. decided in Astron Clinica to complete the previously (apparently) incomplete element of the jigsaw of UK caselaw on software patents. This decision confirms that, in the UK, a computer programme, in abstract and on its own, but which when used has a technical effect, is potentially patentable – subject of course to the usual questions of novelty and obviousness.

Part of the rationale is that this would allow the patent owner to sue a person in the UK where that person exports software to another jurisdiction, rather than equipment containing it. It reflects a modern appreciation of the way in which technology works – software, and real value, is often distributed without any physical embodiment being created, such as by direct distribution to a mobile telephone.

If somewhat giddying, this approach does have the distinct benefit of bringing this aspect of UK law closer to the European Patent Office, although leaving (as he had to do) the question of how you determine what technical effect is relevant. This remains governed by the case of Aerotel v Macrossan. We will have to wait a while before seeing what happens to that rule, as the EPO has curtly dismissed Jacob LJ’s suggestion that the issues be reviewed by an enlarged board of appeal at the EPO.

These decisions show a serious problem is looming in the software field. This is that the law in the EPO changes, and the law in the UK may try and change to follow it; and both do so in timescales which are significantly less than the life of a patent. It is perhaps better that a patent now be granted in respect of subject matter which is later shown to be unpatentable – when the law next changes – than vice versa, but what is good for patent owners if often an extra burden for the competitive innovative environment, and is likely to result in yet further costly problem solving in the courts.

Software Patents - the basics

Last night I was at a British Computing Society Young Professionals Group event on software patents, hosted by Marks & Clerk in their rather nice office next to Covent Garden. They ran an informative session intended to give the diverse audience an understanding of what sofware patents were and which way the wind was blowing.

For those of you familiar with the software patent debate, there is a considerable amount of controversy as to whether software patents should actually be allowed.  Broadly speaking, in the EU and UK certain things are excluded from patentability, which includes 'programs for computers....... as such'. No problem you might say, that seems clear, no patents for software.

The problem concerns the 'as such' wording. This has been interpreted to mean that a computer program is patentable, provided it is not 'just' a computer program. So if a computer programme combined with something else makes a non-obvious technical contribution or solves a technical problem, then it is theoretically capable of being patentable (subject the continuously changing law in this area). So software patents have been granted for voice recognition software and photograph imaging and filtering software - they solve a technical problem or they produce a technical effect. The US has no such prohibition on software patentability, but patentable inventions must still meet all the requirements for patentability.

The speakers highlighted some of the divergences in practice between the EU, UK and US on software patents - US patents for software are a lot easier to obtain. Software patents are granted in the UK and the EU, but the examination threshold require to reach patentability is considerably higher than the US.

I was particularly interested to see that there were a number of undergraduate students and their teacher (Dr Adil Hameed) from Supinfo, a french IT institution. Given the relevance of the ongoing debate and the issues it raises, it is interesting to see future software developers taking a keen interest at such an early stage in their careers.

If you would like to know more about software patents there are some good sources, including wikipedia and this article in the Guardian by Richard Stallman.

Gemstar v. Virgin

Gemstar a US TV listings company part owned by Rupert Murdoch's News Corporation is suing Virgin Media over 3 alleged European patent infringements. Gemstar, whose prolific past litigation record has apparently led to its former chief executive being branded a "patent terrorist" alleges infringement of three European Patents by Virgin for its use of certain Interactive Programme Guide (IPG) technology. The action comes after negotiations over patent licensing broke down.  The executive Vice-President of Gemstar is quoted in the Guardian as saying:

"We have worked diligently to license Virgin Media for their distribution of various set-top boxes that contain IPGs covered by our patents, but negotiations did not lead to a resolution... While we would have preferred to reach a commercial solution with Virgin Media, we ultimately have a responsibility to our shareholders, licensees, and other stakeholders to protect the value of our intellectual property."

IPKat points out that the broad claims of the patents do seem to match what a Virgin Media set top box does and that Virgin Media's dismissal of the action as 'flagrant opportunism' and 'without merit' may be a little premature. However, IPKat also notes that "the English courts are notoriously difficult to please with infringement actions, and will certainly take a long hard look at the validity of the patents (if the proceedings ever get to that stage). As always, the devil will be in the details of what the patents can validly claim, and of course how far each side is willing to go in defending its position".

But don't hold your breath. With much of Gemstar's previous US litigation ending in settlements (eg. here and here), it's just as likely that the court may not get a chance to pick apart the patent claims.

Wireless fight

A Canadian company (Wi-Lan Inc.) is reportedly bringing action against up to 22 firms for infringing its wireless fidelity (wi-fi) and digital subscriber line (DSL) related patent portfolio.

The companies who are facing the legal action include some of the biggest in the IT industry, such as Dell and Intel.

The case has reportedly been brought in the Eastern District of Texas Court, which has a reputation for setting quick timetables for patent disputes, and some commentators think that the Court generally favours patent owners.

Lawyers shown the door in Seagate decision

Lawyers will be weeping. For 24 years patent attorneys in the US have had a lucrative business in writing "non-infringement" opinions with the object of defeating claims for punitive triple damages for willful patent infringement. Each opinion had to involve substantial work or it could be attacked as superficial. However, in In re Seagate the Federal Circuits Court of Appeal has just overturned those happy years. The CAFC decided that the test for such punitive damages is a much higher threshold: the infringement must be reprehensible. This requires that: (1) there was "an objectively high likelihood that [the infringer's] actions constituted infringement of a valid patent", and (ii) this was known or so obvious that it should have been known to the infringer. And incidentally there is no requirement to obtain counsel's opinion to this effect to avoid liability for punitive damages. (For the full text see http://www.patentlyo.com/patent/2007/08/in-re-seagate-t.html).

This could have a major benefit. For years in the electronics and software sectors, where doubtful patents abound (as well as other areas) businesses have steered clear of carrying out patent searches or looking at published patent resources, for fear that, if they find something relevant, they run the risk of triple damages, or the cost of an infringement opinion -- running at US$10,000 and upwards -- or worse still both if the opinion is not unequivocal. Now, with a second chip out of the US pro-patentee stance -- in May 2007, the Supreme Court ruled in the KSR v Teleflex decision that that there is some level of inventive threshold for US patents (http://www.supremecourtus.gov/opinions/06pdf/04-1350.pdf)-- businesses can take a peek at competitor patents, and rely on their own common sense views (with guidance from patent specialists) on whether they are likely to be valid and whether they are likely to be infringed.

Of course it is unlikely that the lawyers will really be impoverished.

The EPO strikes back

Following Peter's post on the High Court decision in IGT v Comptroller [2007] EWHC 1341 (Pat), a November 2006 decision of the European Patent Office (“EPO”) Board of Appeal (T 0152/04) has just come to light which holds, in no uncertain terms, that the Court of Appeal decision in Aerotel Ltd. v Telco Holdings Ltd & Ors Rev 1 [2006] EWCA Civ 1371 is bad law.

The Board of Appeal held that the technical effect approach adopted by Aerotel was “irreconcilable” with the European Patent Convention (“EPC”). The Board of Appeal held that the correct approach was to treat the claimed invention as a whole when assessing patentability, as the combination could be technical even if features taken individually had to be considered non-technical.   A patentable invention could have a mix of technical and non-technical features appearing in a claim, in which the non-technical features may even form a dominating part.  However, non-technical features, to the extent that they do not interact with the technical subject matter of the claim, are ignored in assessing novelty and obviousness. 

Essentially, where the Board of Appeal differs from the Court of Appeal is that, in determining whether a claimed invention is in fact an invention, one applies a two stage test: (1) identify the invention claimed; and (2) check whether the claimed invention produces a technical effect.

One does not (as opposed to the Aerotel approach), also identify the contribution made and then determine whether the contribution falls solely within any of the matters excluded from subject. However, applying the Board of Appeal approach, novelty and obviousness can only be determined only with regard to the technical features of an invention.  Therefore if the contribution made by the invention lies only in its non-technical features,  it follows that the technical features would not be novel or would be obvious, and the invention would not be patentable.

It seems to me that the two different approaches will generally reach the same destination by a different route, the difference being that the Aerotel approach will cause the patent application to fall down at the “invention” hurdle whereas under the Board of Appeal approach, it will clear this hurdle only then to fall down at the next hurdle.

Software patents "lost in lawyer land"

Or at least so says the EPO, according to Lucy Sherriff at The Register: "the system is overwhelmed, overly bureaucratic, and hopelessly lost in lawyer land".  Readers might be surprised to hear that actually we lawyers don't live in a different land and, perhaps even more surprisingly, on the whole we tend to approve of increasing clarity in what we do (at least in the UK following the principles of the Woolf reforms).

This is one reason why, in contrast to many of the vocal individuals who opposed the old software patent directive that was shot down in 2005, we've tended not to dismiss outright the concept of reforming the principles around the grant of software patents (see various previous posts on Naked Law for examples).  As Lucy says: "Even though the European Parliament rejected the CII directive, that doesn't mean the status quo is OK. It just means that the CII directive was not the right update."

The concern from practitioners is that there is no uniform approach to patenting software across the EU (let alone in the rest of the world).  It is encouraging that Alison Brimelow, the new head of the EPO, recognises this: "What we need is not more patents, but more good patents".  IPKat has more information about Ms Brimelow here.

More from cross man Macrossan

IPKat flagged a question this week from Neal Macrossan, the inventor behind the high-profile Aerotel v Telco Holdings case on software patenting (in essence, should Macrossan appeal to the House of Lords?).  Note also the interesting exchange between Macrossan and another commenter on IPKat's earlier post here.  I am afraid that I don't propose to answer Macrossan's question today, but thought this was a good opportunity to observe that the High Court again recently considered the Aerotel case in IGT v Comptroller [2007] EWHC 1341 (Pat).

The Court of Appeal in Aerotel laid down a 4-step approach to be followed in determining whether or not such a claimed invention is patentable:

1. Properly construe the claim – in other words, identify the invention claimed
2. Identify the actual contribution – in other words, determine what the claimed invention has really added to human knowledge
3. Ask whether it falls solely within the excluded subject matter – in other words, is this contribution solely in relation to any of the above excluded subject matters
4. Check whether the actual or alleged contribution is actually technical in nature- this follows from previous case law that in order for a software to be patentable, the claimed invention must make a technical contribution over and above the excluded subject matter mentioned above (the Court of Appeal expressed the view that the fourth step may not be necessary because the third step should have covered that, but felt obliged to include it in the light of previous case law).

The IGT case was an appeal against the decision of the UK Intellectual Property Office refusing four patent applications relating to gaming systems.  The judge noted that in the virtual world it is possible to emulate existing games from the “physical world”, in which case it might be possible to argue that the rules of the game are the same as the rules of the real game and that the computer program is excluded as a scheme, rule or method for playing a game.  The judge stated that if the contribution included something else (e.g. new physical combination of hardware), it may be entitled to protection. However, in this case there was no new physical combination of hardware; the novelty was in the software (a computer program, which was not as such patentable); if that novel software produced a contribution which lies only in the excluded field of rule, method or scheme for playing a game, it could not be the subject of a valid patent.

The court held that in applying the Aerotel four stage test, the key question is not whether a contribution is technical, but whether it lies solely in an excluded area. The important question was therefore not whether the subject matter of the claim was patentable and outside the excluded subject matter, but whether the contribution was within the excluded subject matter.  In the IGT case, the court held that the contribution made lay in the excluded field of a scheme, rule or method for playing a game and upheld the refusal of the applications.