The team is joined by GuestKats Mirko Brüß, Rosie Burbidge, Nedim Malovic, Frantzeska Papadopolou, Mathilde Pavis, and Eibhlin Vardy
InternKats: Rose Hughes, Ieva Giedrimaite, and Cecilia Sbrolli
SpecialKats: Verónica Rodríguez Arguijo (TechieKat), Hayleigh Bosher (Book Review Editor), and Tian Lu (Asia Correspondent).

Sunday, 31 January 2010

Letter from AmeriKat II: bits 'n bobs

Poster poser faces a criminal investigation: Last year the AmeriKat wrote briefly about the Shepard Fairey copyright case, involving the creator’s famous tri-toned “Obama Hope” poster. In February 2008 Fairey brought a pre-emptive claim against the Associated Press (AP), seeking a declaration that his poster did not infringe AP’s photograph (taken by Mannie Garcia, who is also suing for copyright). Last October Fairey admitted to lying about which AP photograph he used for the work and also to destroying and fabricating evidence. As reported by Am Law Daily, Fairey now faces a criminal investigation into his behaviour during the litigation. The news came as a result of Judge Hellerstein denying Fairey’s lawyers’ (Jones Day) motion to extend the discovery deadline by six months in order, in part, to permit Fairey to delay his deposition in the face of a criminal investigation. The extension was denied by Judge Hellerstein, who stated:

“Everything in this world is time sensitive. Especially news. Especially photographs.”
For further information see this article in the New York Times.

Motorola v BlackBerry: Last Friday Motorola filed a complaint with the US International Trade Commission (ITC) requesting an investigation into alleged infringing use of several of Motorola’s patents by RIM, the maker of BlackBerry. The complaint also asked the ITC to ban RIM from importing, selling, marketing and advertising any of the allegedly infringing products. The patents include technology related to controlling Wi-Fi access, power management, and a method for storing received messages. According to an email from Motorola to The Register, RIM had entered into a licence agreement for this technology in 2003, however their use of the patents continued after the deal expired in 2007. The ITC complaint follows the 2008 lawsuits brought by Motorola against RIM in Texas and the UK which have yet to be resolved. Jonathan Meyer, Motorola’s VP of IP, declared:
“[i]n light of RIM’s continued unlicensed use of Motorola’s patents RIM’s use of delay tactics in our current patent litigation, and RIM’s refusal to design out Motorola’s proprietary technology, Motorola has no choice but to file a complaint with the ITC to halt RIM’s continued infringement.”
For more information see this article in the Wall Street Journal.

USPTO’s interim procedures for patent term extensions: Last week the AmeriKat reported on the important decision of Wyeth v Kappos which held that the USPTO misapplied patent term calculations resulting in shorter patent terms for patentees than what they should have been. Last week the USPTO announced interim procedures for re-calculating and extending patent terms. The USPTO will process recalculation requests for patents issued prior to 2 March 2010 that are requested no later than 180 days after the issue date. After 2 March 2010 the USPTO expects that their software modifications will calculate patent terms correctly. Here’s hoping….

Final push of opposition to Google Book Settlement: In the past week the Google Book Settlement has faced a further deluge of opposition with authors such as JK Rowling and Philip Pullman opposing the Settlement. As reported by The Times, Rowling’s lawyer stated that the settlement “purport[s] to change US and international copyright rules.” The AmeriKat says, however, that the Settlement does not change copyright rules, it just attempts to bypass them. Sci-fi author Ursula Le Guin (right) also joined the opposition last week stating, in a petition signed by almost 400 other authors, that, like France and Germany, the US should
“also be exempted from the settlement. We ask that the principle of copyright, which is directly threatened by the settlement, be honored and upheld in the United States.”
The final fairness hearing is scheduled for 18 February 2010 at 10AM. The AmeriKat recommends that readers review the letters of opposition filed last week, including those from France and Germany.

Letter from AmeriKat I: Putting the iP in iPad

Yesterday afternoon the AmeriKat was searching her closet in vain for some snazzy little number to wear to a party. The dress she had deemed worthy of such an occasion –- a frilly black number -- had two layers of stitching hang askew, demanding desperate attention. Having only paws and no real opposable thumbs to speak of, any sewing seemed out of the question. Following consultation with her trusted advisors and a one-hour perusal of her clothing (which only revealed that she had little to wear except work clothes or ball gowns), the AmeriKat did what any fashionable kitten would do -– she went and bought the same frilly number in navy blue. Because, thought the AmeriKat, why mess with something that already works?

Putting the iP in iPad

Apple seems to have apparently adopted this line of thinking when naming its latest must-have product, the tablet known as the iPad. Eight years earlier, however, Fujitsu released a colour touch-screen computing handset, also named the iPad. According to the New York Times, Fujitsu applied for a trade mark in March 2003 but this application was stalled due to an earlier filing made by an information technology security company, Mag-Tech, relating to another device. Fortunately for Apple, however, this consequently had the effect that the USPTO declared that Fujitsu had abandoned the iPad mark in early 2009, leaving it free for the taking by Apple. Fujitsu, however, had other ideas.

Later that year the Japanese company decided to revive their application. A month later, Apple filed an international trade mark for “iPad” and has since continued to oppose Fujitsu’s application. Apple is reported to have until 28 February 2010 to contest Fujitsu’s claim to the name. A Fujitsu statement issued last Thursday stated that the company was discussing “the possible infringement on our trademark” with lawyers. No further comment was issued by Fujitsu. An Apple spokesperson declined to comment.

If all this sounds familiar, the AmeriKat reminds readers that this dispute is similar to the argument between Apple and Cisco systems over the iPhone name in 2007. The two parties entered into a confidential settlement agreeing to share the rights to the name, the remaining terms of the agreement have never been disclosed.

For further information see these articles in the Wall Street Journal and the Financial Times.

How genuine is OMEL/ONEL?

The IPKat has caught the distant sound of Dutch trade mark personalities discussing the recent and still controversial OMEL/ONEL case, in which use of a Community trade mark in just one of the 27 Member States was not considered to be genuine use of an earlier mark in Benelux opposition proceedings (see the IPKat here, here and here). What the Kat heard, from a little bird, runs like this:

"ONEL -- the opponent in the proceedings in question -- is believed to be related to another firm, Knijff (the two share the same address and PO Box number), and some folk have asked whether this may case may have been cleverly crafted in order to stir up debate and perhaps obtain an authoritative ruling on an issue which certainly needs clarification.

OMEL, the opposed trade mark application, was filed by Hagelkruis Beheer B.V., a holding/real estate company with no employees and just a single shareholder, his wife being the "acting" director. The company registered a Benelux mark without a trade mark attorney. That is not very odd by itself, but rather odd if you consider that this application was filed only in the Benelux in order to secure a basic registration in order to obtain through the Madrid system some registrations in Scandinavia. I have never heard of small, non-represented clients in the Benelux using the Madrid system. What's more, the arguments that Hagelkruis raised are "too good" to have come from a person who has not specialized in trade mark law ...".
The IPKat is prepared to keep an open mind, since the ways of both businesses and trade mark practitioners around Europe are bound to differ from country to country; what's more, any lay person who regularly reads this blog and Class 46 would soon be expected to obtain a good education in European trade mark law. Merpel's not so sure: she still wonders about the European Court of Justice references in Case C-283/01 Shield Mark and Case C-273/00 Sieckmann, where the principal actors were IP practitioners themselves. Nothing to wonder about, says the IPKat -- intellectual property attorneys are allowed to use trade marks too, and any system that leaves gaps in its legislative details deserves to have those gaps filled in. But even so, it would be good to know a bit more about the background of this dispute.

Saturday, 30 January 2010

EQEs - Watch Out!

The IPKat spotted this morning the latest issue of the EPO Official Journal. There isn't really anything of much interest, assuming you have been paying attention to announcements such as Montenegro becoming an extension state (which the IPKat noted here), unless you have a particular interest in new fees in Sweden, the EPO's holidays in 2010 or what happened at last month's meeting of the Administrative Council (which has been written about more extensively elsewhere).

What struck the IPKat, however, was the EPO's new Instructions to candidates concerning the conduct of the European qualifying examination, which includes the following rule:

The IPKat is fairly sure the rules weren't this strict last year, otherwise he would have worried about taking his new Casio watch into the exam hall with him, but maybe he has missed out on the latest advances in digital watch technology. Given all the stuff that it is possible to legitimately take to the exam, how is it possible to cheat at the EQEs with a digital watch? Or is this perhaps about the possibility of annoying bleeps? Can anyone assist with a reasoned explanation?

Friday, 29 January 2010

Genuine use of a Community trade mark: MARQUES speaks out

Wasting no time in (i) issuing a decisive statement and (ii) agreeing with the position taken by the IPKat himself, European trade mark organisation MARQUES has come down firmly against the controversial ruling of the Benelux Office for Intellectual Property (BOIP) that the use of a Community trade mark in just one of the 27 Member States of the European Union did not constitute "genuine use" on the part of an owner relying on that mark in opposition proceedings against a later and undeniably similar mark.

Right: MARQUES has roared -- but will BOIP hear the message?

Says MARQUES (in relevant part):
" ... MARQUES works actively to ensure that businesses are involved and duly represented in the debate surrounding developments of the systems they use to protect their trade marks. That is the reason why MARQUES wishes to make a statement in connection with the recent ruling by the Benelux Office for Intellectual Property (the Leno Merken B.V./Hagelkruis Beheer bv case [on which, see earlier IPKat postings here and here, together with some perceptive comments by readers on both sides]).
The referred Decision from the Opposition Division of the BOIP of 15 January 2010 states in summary that use of a CTM in one EU Member State is not sufficient to constitute genuine use within the meaning of the Trade Mark Directive and CTM Regulation.
MARQUES disagrees with the interpretation of the concept of genuine use contained in the ruling of the Benelux IP Office on the basis of the following considerations.
MARQUES considers that the ruling is contrary to the concept of one single unitary trademark right conferred under the CTM system and seriously jeopardises this concept. Neither the CTMR nor the case law of the ECJ gives any support to the ruling of the BOIP. Genuine use in the EU has been interpreted as meaning that the mark is used in accordance with its functions, which are to guarantee the identity of the origin of the goods or services for which it is registered, to constitute a guarantee of the products/services in question, and those of communication, investment or advertising (Case C-487/07 L’Oreal SA and Bellure NV).
When assessing that, regard must be had to all the facts and circumstances relevant to establishing whether the commercial exploitation of the mark is real (Case C-40/01 Ansul BV and Ajax Brandbeveiliging BV).
Furthermore, it has also been stated that use of the mark may in some cases be sufficient to establish genuine use within the meaning of the Directive, even if that use is not quantitatively significant (Case C-259 La Mer Technology Inc. and Laboratories Goemar SA). Indeed, the European Court of Justice ruled that even minimal use can be sufficient to qualify as genuine, on condition that it is deemed to be justified, in the economic sector concerned, for the purpose of preserving or creating market share for the goods or services protected by the mark. The question whether use is sufficient to maintain or create market share for the goods or services protected by the mark thus depends on several factors and on a case by case assessment (Case T-191 Anheuser Busch Inc and HIM).
By way of analogy, the Court of Justice was already asked to state whether “reputation in the Community” was satisfied in case where the CTM had a reputation in only one Member State (Case C-301/07 Pago International GmbH and Tirolmilch registrierte Genossenschaft mbH). The Court ruled that the condition should be considered to be fulfilled when the CTM had a reputation in a substantial part of the territory of the Community. At that case, the territorial requirement was considered satisfied with regard to a single Member State, namely Austria. As a conclusion, the territory of a single Member State may be considered to constitute a substantial part of the territory of the Community.
In the light of the foregoing, MARQUES is of the opinion that the BOIP Opposition Decision in question contradicts the uniform interpretation of the concept of genuine use in the EU. We are of the opinion that the question whether use is sufficient to constitute genuine use relies on all the circumstances relevant to establishing that the use is real. The implementation of such criteria shall not depend on the number of Member States affected by the use of the mark. The opposite interpretation would affect the main principles of the CTM system.
The CTM is one of three options for protection of trade marks in Europe, and the number of CTMs proves the business interest in the system. MARQUES strongly believes in the principle of the unitary character of the CTM and will continue to support this concept".
This statement is signed by Guido Baumgartner (Chairman of Council) and Tove Graulund (who represents MARQUES on the OHIM ABBC). Bravo, says the IPKat. Merpel says, I thought there were only two options for protecting trade marks in Europe -- CTMs and national/regional registrations. Then I remembered, most trade marks are registrable as Community designs too!

Friday fantasies

Once again it's Friday, time to take a break from the tests and traumas of the working week ... and to check the IPKat's fabled sidebar for news of forthcoming events.

Reverting to Smarties, following his post last week the IPKat has received further correspondence regarding the proper generic term by which the ubiquitous confection might be correctly indicated. IP commentator Rebecca Dimaridis (Jeffrey Green Russell) speculates: "Using the KISS principle, I would have thought "candy" is sufficient (i.e. 'Smarties candy', following the mark with a descriptive name, as suggested by Ch.127 of the Trade Mark Handbook". Denise McFarland (3 New Square) brazenly suggests giving Smarties an entirely new name -- "Rushons" (a sort of condensed version of "rainbow coloured sugar buttons". Or is that too reminiscent of Red Square and the steppes, leading everyone to think the sweets contain vodka ... ? At least that would leave the word 'smarties' free for use by Nestlé's competitors.

Now here's something completely different. The IPKat's friend, UK-based fellow blogger Shireen Smith writes:
"Given all the discussions generated by Richard Susskind’s ‘End of Lawyers?’ and the Legal Services Act 2007, which comes fully into effect in 2011, I've been wondering how to deliver an alternative to legal services based on an hourly rate of £250 (albeit quoted as a fixed fee), or providing document templates for sale. This latter option has never appealed to me, so my firm (Azrights) has never sold precedents. That’s because few transactions will be standard, and I fear that people who purchase precedents will feel comforted that they have something in place, without realising that the template they have bought needs to be tailored to fit their circumstances. Unless they understand the commercial context of the contract how are they even to know that the contract does not cover the particular point they have just agreed?
I have been particularly concerned about internet transactions, because so few small businesses seem to bother with legal advice when they commission websites or buy search engine optimisation (SEO) services. When I began to run workshops at the British Library’s Business and IP Centre, I realised that it is not that there is no interest by small businesses to understand the commercial and legal issues. It is just that their resources cannot stretch to paying expensive legal fees in order to receive advice. So, that’s how I came up with the idea of a new product, which is priced affordably, and is also available for licensing by lawyers. Here's my press release about it.

I am looking for internet lawyers in common law countries to approve the contract that comes with the product, so that it can be sold internationally, given that it is an internet transaction that is covered. Can anyone who is interested please contact me".

Animal logos are always popular, some because they enable a business to bask in the reflected characteristics of the animals themselves. Thus Puma and Jaguar, for instance, suggest speed and/or acceleration [it doesn't work for all creatures, notes Merpel: the Lacoste crocodile and Caterpillar are two examples] . The Kat has now been alerted by Duncan Bucknell to Save Your Logo, a brilliant idea if ever there was one: "Many companies and organizations use plant or animals in their logos ... Save Your Logo creates an opportunity for companies represented by a plant or animal in their logo to contribute to the conservation of that species". It costs money, but it's all in a good cause, as the website explains.

The Kats are all great admirers of Richard Arnold (left) who, as a judge of the Patents Court (England and Wales), has made some notable contributions to the development of intellectual property jurisprudence during his relatively short term in office. Some would say that his performance on the Bench has been little short of incredible, which is possibly why the IPKat has received emails from time to time on the subject of his resemblance to Mr Incredible's boss (right) in the Disney production of The Incredibles. Readers are invited to consider whether there is indeed some resemblance and, if so, which is the infringing copy ... [says Merpel, the word "incredible" actually means "not capable of being believed". While that sobriquet might be applicable to some witnesses -- and most counsel -- it should never be applied to a member of Her Majesty's judiciary].

Thursday, 28 January 2010

Patentable subject matter - Where are we now?

Various members of the IPKat's human team were at the 2010 CLT IP Conference earlier today, and IPKat helper David Pearce gave a presentation on where we are now with patentable subject matter in Europe. This post is an edited version of the paper that accompanied the presentation, and is being reproduced here for the benefit of those who didn't attend, and also for those who did and want an easier way of getting to all the internet references.

The presentation concentrated on developments over the past few years in the law on patentable subject matter, in particular relating to so-called software patents (or, according to the EPO's more accurate general term, 'computer-implemented inventions'), with emphasis on how the UK Patent Office and courts have dealt with the issue, and how this compares with the approach taken by the EPO and their Boards of Appeal.

What subject-matter is patentable?

In Europe, all inventions that are new and not obvious are patentable [Article 52(1) EPC], but this is subject to various exceptions and exclusions. The exceptions [Article 53 EPC] are:

  • inventions the commercial exploitation of which would be contrary to "ordre public" or morality;
  • plant or animal varieties or essentially biological processes for the production of plants or animals; and
  • methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practised on the human or animal body.
The exclusions, being things that are not considered to be inventions [Article 52(2) EPC] are:

  1. discoveries;
  2. scientific theories;
  3. mathematical methods;
  4. aesthetic creations;
  5. programs for computers;
  6. presentations of information; and
  7. schemes, rules and methods for performing mental acts, playing games or doing business.
These are, however, only excluded from patentability to the extent that a patent application (i.e. the claimed invention) relates to one or more of these things as such.

As an aside, Lord Hoffmann (who was, until recently, the most senior IP judge in the UK) has come up with two reasons that could be used to at least explain these exclusions. Exclusions 1-6 above fall within what he considers to be the 'practical application principle', that these things cannot be the subject of a patent in themselves, but this would not necessarily stop practical applications being patentable (for example, the practical application of the discovery of the electrical nature of lightning to the invention of a lightning rod). The last exclusion falls within the 'human behaviour principle', since mental acts, playing games and doing business are all aspects of human behaviour that should not (presumably for practical as well as ethical reasons) be patented, even though they may be new, useful and inventive. See here for more details.

There is no single reason that can be used to explain all these exclusions and exceptions, largely because the reasons for including them in the first place were different. Nonetheless, courts and appeal boards have, over the years, tried to come up with legal reasoning to cover at least the exclusions (the exceptions under Article 53 are usually dealt with separately, and are not the subject of this paper). This goes back all the way to the 1980s, when the European Patent Convention and the UK Patents Act 1977 were still fairly new.

Although there are different issues and complications with many of the above exclusions, one that has stood out from all the others over the last 25 years or so is that of programs for computers. This is mainly because computer programs, which are now much more separable from the hardware on which they can be run than they were in the past, have become much more important commercially in themselves. It is often said by opponents of the current patent system that the rise of Microsoft in the 1980s and 1990s did not depend on patents being available for software, but it is certainly now the case that Microsoft, along with every other major commercial software provider, use the patent system as a matter of course in their businesses.

Many people think that the computer program exclusion means that there should be no patent protection available for computer programs at all. This was not necessarily what the framers of the EPC had in mind when the Convention was being drawn up, otherwise the words 'as such' would presumably not have been included. As a consequence, what has been considered to be a non-invention has subtly (and sometimes not so subtly) changed over time, as the law has been reinterpreted over the years. Particularly in the case of the EPO, these changes have perhaps not been as dramatic as some might like to make out, as there has in reality been quite little movement for over 20 years on the substantive issue of whether inventions implemented purely by means of software are patentable.

At the moment, the law across Europe about how to decide what is and is not patentable is not settled, even though the same law should effectively apply in all member states of the EPC (comprising all 27 EU states together with a few other non-EU states). The relevant Articles of the EPC are intended to have the same effect as the corresponding Sections of the Patents Act 1977 in the UK. Section 130(7) of the UK Patents Act 1977 states that the relevant sections of the Act "are so framed as to have, as nearly as practicable, the same effects in the United Kingdom as the corresponding provisions of the European Patent Convention". Nevertheless, how the law has been interpreted has led to different reasoning being used. The UK Patent Office, following the lead given by several (equally binding) Court of Appeal judgments, deals with patentable subject matter in one way, whereas the EPO, following the developing lines of reason in the case law of the (non-binding but usually persuasive) Technical Boards of Appeal, deals with patentable subject matter in quite a different way.

The fact that the UK and EPO approaches to patentable subject-matter are different should not in practice matter, since the law is the same and the same result should be (and usually is) arrived at regardless of the reasoning. Each case will however rely on its own facts and circumstances and, at the borderline, there is always an element of subjectivity involved that could, in some cases, swing a decision either way. At the borderline of what is and is not patentable (which will of course always exist for as long as there are patent applications to be prosecuted), there are current strong disagreements between how the law is applied in the UK according to the Court of Appeal, and how it is applied at the EPO according to the EPO Technical Boards of Appeal. Although some may view these differences as being like arguments over how many angels could dance on the head of a pin, the issues are quite serious at least to those directly involved and can cause much annoyance and confusion to the rest of us.

The EPO Approach

The EPO views Computer-Implemented Inventions (CIIs) as follows:

"A CII is usually defined as an invention that works by using a computer, a computer network or other programmable apparatus. To qualify, the invention also needs to have one or more features which are realised wholly or partly by means of a computer program

To be patentable, CIIs must fulfil the same basic patentability requirements as inventions in all other fields. These are set out in the European Patent Convention (EPC).

Accordingly, CIIs can be patented if:

· They have technical character and solve a technical problem.
· They are new.
· They involve an inventive technical contribution to the prior art.

With this definition as a basis, the patenting process for CIIs at the EPO is very restrictive as it puts emphasis on new technical solutions. The most striking consequence of this definition is that computer programs, which do not solve a technical problem, are not patentable in Europe".

Examples of clearly patentable CIIs include anti-lock braking systems, encryption/decryption methods and audiovisual processing techniques (e.g. MPEG audio/video technology). An early EPO case relating to image processing was that of Vicom (T 208/84), which was decided in 1986. The invention related to a new mathematical technique applied to matrices of input data, which would typically represent digital image data. Provided the invention was claimed in the form of a method for processing images, rather than a purely mathematical method applied to data in general, the EPO considered that the method was patentable, because the technical effect of the invention was about processing images more efficiently.

Another key early case was that of Koch & Sterzel (T 26/86), which related to a software-implemented method of controlling an X-Ray apparatus for radiological imaging. Even though there was no new hardware required (the invention could work on existing known machinery), the EPO Board of Appeal considered that the invention was patentable because the invention resulted in a new and inventive technical effect. The fact that this was enabled by software on known hardware was, in the Board's view, irrelevant.

The decisions of Vicom and Koch & Sterzel are largely consistent with the case law that followed over the next 20 years. There is essentially not very much that has changed in the way that CIIs have been dealt with by the EPO. The problem areas have in the main been largely to do with where computer programs are used for implementing other excluded things, in particular business methods.

The EPO approach to patentable subject-matter is inseparable from the established problem-solution approach to assess inventive step. According to this approach, if a claimed invention is new, the proper way to assess whether there is an inventive step is to look at what technical problem the invention solves, in light of the known prior art. Firstly, the difference between the invention and the prior art is identified. Secondly, the technical effect of this difference (if any) is identified. Thirdly, the objective technical problem is identified, given this technical effect. Finally, an assessment is made of whether, given this objective technical problem, the skilled person would find it obvious to arrive at the claimed invention.

Many of the problems associated with patenting CIIs have been more to do with computer-implementations of what are effectively business methods. Two influential cases at the EPO have addressed this issue, Hitachi (T 258/03) and Comvik (T 641/00). This first of these related to implementing a modified Dutch auction on a networked computer system, i.e. over the internet. The EPO Board of Appeal decided that, although the claimed invention was not excluded as an invention because it involved technical means (even a pen and paper would suffice for this test), it was not patentable because any objective technical problem derived from the prior art was merely avoided by the use of a different business method. Implementing the new business method on a computer did not make it patentable.

The other decision of Comvik related to a SIM card allowing for two 'identities', which allowed call charges to be allocated to different accounts. The Board of Appeal rejected the application, deciding that an invention having 'technical character' had to be assessed as a whole, but that features making no contribution to the technical character of the invention could not be used to support the presence of an inventive step. The idea of using two identities on a single SIM card did not make a contribution to solving a technical problem, and it was obvious how it would be implemented, so the invention failed under Article 56.

Following Comvik, the usual approach at the EPO is to move all of the features that do not contribute to the technical character of the invention into the problem part of the PSA, rather than part of the solution. As a result, most business method-type applications fall at the Article 56 hurdle, from the reasoning that implementing a new business method on a standard computer would be normally be obvious to the skilled person, who is typically judged to be a computer programmer.

The UK Approach

Unlike at the EPO, the UK Patent Office, the High Court and the Court of Appeal are all bound by previous judgments of the Court of Appeal (there have not yet been any House of Lords or Supreme Court judgments in the area of excluded subject-matter). This has made things more complicated, and often quite difficult to follow.

There have been five Court of Appeal decisions over the past twenty years on the subject of the exclusions to patentability, being:

Merrill Lynch's Application [1989] RPC 561 - effectively a business method case, in which a method of automated trading of securities was judged to be not patentable, but established a link with the EPO case law on computer programs by explicitly approving the Vicom decision.

Gale's Application [1991] RPC 305 - a new method of calculating square roots using software does not become patentable merely due to the medium on which the computer program is stored (in this case a ROM chip).

Fujitsu Limited's Application [1997] RPC 608 - a method of visualising chemical bonds in a similar way to a conventional ball and stick model does not become patentable merely by virtue of being implemented in software.

Aerotel v Telco & Neal Macrossan's Application (Aerotel/Macrossan) [2006] EWCA Civ 1371 - a telephone exchange (Aerotel) allowing for a different method of charging phone calls would be patentable if it involved new hardware (although this turned out not to be as new as was first thought, and the patent was finally revoked for a lack of inventive step in the later decision of Aerotel v Wavecrest); a method of assembling documents for establishing a company (Macrossan) is not patentable, whether implemented on a computer or not.

Symbian Ltd v Comptroller General of Patents [2008] EWCA Civ 1066 - a way of addressing DLLs in a computer that results in improved reliability provides for a technical effect that could be used to justify the invention being patentable.

The above decisions are all equally binding on the lower courts and the Patent Office, and on the Court of Appeal itself, but it was Aerotel/Macrossan in October 2006 that kicked off a (sometimes rather heated) pan-European discussion that has gone on now for the past three years and is still not properly resolved (as of January 2010).

Because the Patent Office wanted to have a more reliable way of assessing what would and would not be patentable, in Aerotel/Macrossan a new four-step test was proposed which was argued to be compatible with the existing case law. This test was agreed by the Court of Appeal judges, and goes like this:

  1. Properly construe the claim;
  2. identify the actual contribution;
  3. ask whether it falls solely within the excluded subject matter; and
  4. check whether the actual or alleged contribution is actually technical in nature.
This deceptively simple test is in practice a minefield of difficulties, the most difficult part arguably being that of defining what the actual contribution of the alleged invention is. For a while, the Patent Office interpreted step 1 to mean that any claims to computer programs (which had been judged to be allowable at the EPO and the UKPO for several years) could not be allowed, because the scope of monopoly (which Jacob LJ said was an integral part of the step of construing the claims) was that of a computer program as such. This contradicted the established case law of the EPO, which in 1998 had established, in IBM/Computer Program Product (T 1173/98) that a computer program could be claimed by itself if it referred to the features of an allowable method claim.

The Patent Office practice of refusing computer program claims was then reversed by the decision in the Patents Court of Astron Clinica in 2007, in which it was emphatically stated that such claims should continue to be allowable, partly because to do otherwise would contradict what the EPO had been doing consistently for years.

Another difficulty, which the later decision of Symbian tried to address, was whether step 4, which was included to conform the test with the previous case of Merrill Lynch (which introduced the 'technical effect' test), meant anything at all. The Patent Office had been effectively ignoring this step when deciding on patentability, because they considered that if the contribution was only in excluded subject matter it could not be technical. Symbian resolved this to some extent, but only by effectively fudging together the third and fourth steps.

The Controversy: October 2006 to present

Jacob LJ, leading the judgment in Aerotel/Macrossan, threw down a gauntlet to the EPO, in the form of a series of questions that he proposed should be put to the Enlarged Board of Appeal, so that certain apparent 'contradictions' in the EPO case law could be resolved. Jacob LJ reviewed many EPO Board of Appeal decisions on the area of excluded subject-matter, and decided that none of them could be followed because they inevitably led to different conclusions.

"It is formally no business of ours to define questions to be asked of an Enlarged Board of Appeal. What we say now is only put forward in case the President of the EPO finds it helpful. If he thinks it pointless or arrogant of us to go this far, he is of course entirely free to ignore all we say. Nonetheless in the hope that there is a spirit of co-operation between national courts and the EPO we ventured to ask the parties what questions might be posed by the President of an Enlarged Board pursuant to Art.112. As we have said the British Comptroller of Patents has encouraged us in this course.

The Comptroller and Mr Thorley provided a joint suggestion and Mr Macrossan helpfully his. Having considered the drafts, the questions which we think might be put are as follows:

(1) What is the correct approach to adopt in determining whether an invention relates to subject matter that is excluded under Article 52?
(2) How should those elements of a claim that relate to excluded subject matter be treated when assessing whether an invention is novel and inventive under Articles 54 and 56?
(3) And specifically:
(a) Is an operative computer program loaded onto a medium such as a chip or hard drive of a computer excluded by Art.52(2) unless it produces a technical effect, if so what is meant by 'technical effect'?
(b) What are the key characteristics of the method of doing business exclusion?" (Aerotel/Macrossan, paragraphs 75-76)

Shortly after Aerotel/Macrossan came out, an EPO Technical Board of Appeal responded in rather emphatic fashion to Jacob LJ's suggestion, the Board stating that the four-step test was "not consistent with a good-faith interpretation of the European Patent Convention" (T 154/04, point 12 of the reasons), and refusing to consider referring the questions to the Enlarged Board:

"[T]he practice and case law of the Board [...] have a sound legal basis in the Convention and are consistent with the case law of the boards of appeal and the Enlarged Board of Appeal. To decide on the present appeal, an answer of the Enlarged Board of Appeal to any of these questions is thus not required, and hence the request of referring these questions must be refused." (Reasons, point 17)

The then EPO President, Alain Pompidou also refused to refer the questions to the Enlarged Board, stating in a letter of reply to Jacob LJ in March 2007:

"On the basis of [discussions within the EPO] I have decided that at the moment there is an insufficient legal basis for a referral under Article 112(1)(b) EPC. Leaving aside Board of Appeal case law the line of reasoning of which has been abandoned by later case law, I believe there are insufficient differences between current Board of Appeal decisions dealing with Article 52 EPC exclusions on important points of law that would justify a referral at this stage".

Alison Brimelow, who had previously been the Comptroller of the UK Patent Office, became EPO President a few months later, and was clearly more amenable to referring some questions to try to resolve the apparent conflict in the EPO case law, even though her predecessor and the Boards of Appeal clearly thought that such a conflict did not exist. The following questions were referred by Ms Brimelow to the Enlarged Board in October 2008:

1. Can a computer program only be excluded as a computer program as such if it is explicitly claimed as a computer program?

2.(a) Can a claim in the area of computer programs avoid exclusion under Art. 52(2)(c) and (3) merely by explicitly mentioning the use of a computer or a computer-readable data storage medium?

2.(b) If question 2(a) is answered in the negative, is a further technical effect necessary to avoid exclusion, said effect going beyond those effects inherent in the use of a computer or data storage medium to respectively execute or store a computer program?

3.(a) Must a claimed feature cause a technical effect on a physical entity in the real world in order to contribute to the technical character of the claim?

3.(b) If question 3(a) is answered in the positive, is it sufficient that the physical entity be an unspecified computer?

3.(c) If question 3(a) is answered in the negative, can features contribute to the technical character of the claim if the only effects to which they contribute are independent of any particular hardware that may be used?

4.(a) Does the activity of programming a computer necessarily involve technical considerations?

4.(b) If question 4(a) is answered in the positive, do all features resulting from programming thus contribute to the technical character of a claim?

4.(c) If question 4(a) is answered in the negative, can features resulting from programming contribute to the technical character of a claim only when they contribute to a further technical effect when the program is executed?

So Where Are We Now?

As far as the EPO Technical Boards of Appeal are concerned, nothing has changed. However, as far as the UK Patent Office and the Court of Appeal are concerned, the EPO case law is so full of contradictions that it cannot be followed in any meaningful way. Before the recent referral was made, the situation was at an apparent stalemate, with neither side willing to give way or refer to a higher authority that might be able to resolve the conflict (leave to appeal to the House or Lords, as it then was, for the Macrossan part of the Aerotel/Macrossan decision was refused, apparently because there were no sufficiently important issues to be decided).

The way that patentable subject-matter is decided at the EPO is in fact largely the same (with a few modifications and refinements along the way) as it has been for the past 25 years. The referral to the Enlarged Board is therefore, in the view of this author as well as other more eminent commenters on the issue, unlikely to have any effect if, as seems likely to happen, the referral is judged to be inadmissible under Article 112(1)(b). Even if the Enlarged Board do decide to answer some or all of the questions, it seems likely that they will merely refer to the current line of reasoning being followed by the lower Boards of Appeal as being correct, and will refrain from making any definitive statements on where the boundary of patentability should lie.

In the UK, the situation remains more difficult to assess given the difficulty of reconciling five different, equally binding, Court of Appeal judgments. For now, examination at the Patent Office continues to follow the Aerotel/Macrossan four-step test, with the qualification applied by the later decision of Symbian. Perhaps once the Enlarged Board arrive at their decision, some clarity will return to the UK approach, but this might require a trip to the Supreme Court to sort out the issues properly.

Although there has been much discussion of the differences between how patentable subject-matter is dealt with in the UK and European Patent Offices, it should be remembered that, in the great majority of cases, the same result will nonetheless be achieved.

What Next?

It is generally expected that the EPO Enlarged Board will come to a decision within the next few months. Regardless of what this decision is, it should help to resolve at least some of the differences between the EPO and UK approaches. The author, who predicts that the Enlarged Board will rule the referral as being inadmissible, suspects that the issue is unlikely to be fully settled for quite some time to come, if at all.

IP Update Conference: some comments

Speaking first at the CLT Intellectual Property Law Conference this morning, Trevor Coook (Bird & Bird) opened with a review of global developments. He mentioned that the World Intellectual Property Organization (WIPO) currently seemed a good deal happier than it had in the past, and also that WIPO's figures for international filings were somewhat down [Could these two statements be in some way related? Merpel wonders]. He reviewed the activities of the various Standing Committees, as well as the current status of the Development Agenda, which appears to permeate so many areas of WIPO's work; the Development Agenda has moved beyond the point of being a talking shop, as tasks are being set for specific action.

The World Trade Organization's TRIPS Agreement, Trevor reminded the audience, now set the basic international norms for IP law as well as establishing an effective means ("with teeth") of resolving disputes when TRIPS members accused one another of failing to comply with the treaty's norms. He detailed both the manner in which the US-China copyright dispute of 10 April 2007 was adjudicated, and its (aftermath) and the "teeth" -- cross-retaliation by countries injured by breach of WTO rules by infringing IP rights from the countries in breach (Brazil's retaliation in respect of US cotton subsidies being a case in point).

Next to speak was Liz Coleman (Patents Directorate, Intellectual Property Office), who picked two topics on which to focus -- the patent prosecution highway (PPH) and the activities of the Strategic Advisory Board for Intellectual Property (SABIP). The PPH, essentially a set of bilateral arrangements between national/regional patent offices initiated by the offices of the US and Japan, now covers 14 countries [adds Merpel, it's so good to hear the words 'Japan' and 'pilot' associated with something so much more positive than Kamikaze ...]. Liz also displayed this lovely figure to illustrate the current state of full implementation, pilot projects and proposed highways.
Moving on to SABIP, Liz described the need for research-based evidence on which to build IP policy, reviewing its current programme of funded research as well as the points revealed in the research results released so far (see SABIP's website for details). Following some bright and breezy questions and answers, we all went off for coffee ...

Wednesday, 27 January 2010

Wednesday whimsies

If you are in Central London this Thursday, 28 January, and aren't too far from Holborn, various members of the IPKat blogging team will be having a refreshing drink at the Melton Mowbray pub, in High Holborn, near Chancery Lane tube station between around 5.15pm and 6.15pm. If you'd like to pop in and say hello to us, please feel free to do so. If you have to fill in a time sheet to explain your absence, just put this down to "serendipitous networking".

The IPKat has learned from his friend Pamela S. Chestek (Red Hat's Senior IP Attorney) that Red Hat just launched a website about open source and open collaboration at ("where open source multiplies"). It has a "Law" channel, where (Pamela says) we can all discuss legal issues, which are generally IP issues, as they relate to open source and collaboration. Warns the IPKat, be careful not to confuse this site with, or ...

Apple has been in the news a lot this week, with talk of the Tablet (says Merpel, "If an Apple a day keeps the doctor away, who needs to keep taking the Tablets ...?"), but the IPKat's favourite apples are Golden Delicious, withered to perfection and just about to ferment. Be that as it may, the produictive "pear" of Professor Paul J. Heald and Susannah Chapman have been at it again. This time he has produced an Apple Diversity Report Card for the Twentieth Century: Patents and Other Sources of Innovation in the Market for Apples. As he explains:
"Contrary to popular belief, the twentieth century was a good one for commercial apple varietal diversity. As measured by availability in commercial nursery catalogs, significant gains were made in both absolute number of apple varieties and the available number of pre-1900 historic varieties. In 1905, an estimated 420 different apple varieties were commercially available, approximately 390 of which dated from the 19th century or earlier. By 2000, 1469 different apple varieties were offered in commercial catalogs, at least 435 of which were pre-1900 century varieties. And, if one counts apple varieties maintained in the USDA orchards as commercially available (one can obtain scions by making a simple on-line request), hundreds more apples, including many historic varieties, can be added to the count. Most importantly, the data collected reveals the sources of diversity gains in the twentieth century, including an analysis of the percentage of varieties resulting from patented innovation, non-patented local innovation, preservation of old varieties, and importation. Although patented apples constitute a relatively small percentage of available varieties, they exhibit stunningly high commercialization rates and surprisingly low obsolescence rates. A unique list of all patented apples, their varietal names, and present availability is included in an appendix."
The IPKat really appreciates this research, since it is based on real and verifiable data that shows how the patent system, properly used, can confer not merely market advantage but environmental benefit too. This paper may be accessed via SSRN here.

A studious friend of the IPKat who finds herself going off to work for a company which uses Belgian law in its international contracts has asked him a question. He doesn't know the answer but hopes his readers might: "Is there are any intensive course (up to one week) on the applicable law in international contracts which I can study in order to get a good debrief on the peculiarities of the Belgian Law as compared to the law of England and Wales?" If you can help, please email the IPKat here and he'll pass the information on.

Another student friend of the IPKat hopes to study for a Masters Degree in Intellectual Property. He notes with sadness that the best-known courses in the best-known institutions are quite expensive and, since he comes from a country whose currency suffers from a disadvantageous exchange rate, he has asked the Kat if he can recommend a Masters course that is affordable, or at least relatively so. Once again, suggestions are welcome: mail them to the IPKat here and he'll both pass them on and, if possible, publish a list on this weblog.

Tuesday, 26 January 2010

Are you aware of IPEuropAware?

Until today, the IPKat was not aware that there was a European-wide effort aimed at helping small and medium-sized enterprises (SMEs) protect their intellectual property, and certainly had no idea that such a thing might be based in Alicante.  The existence of the (rather clunkily-named) IPEuropAware was, however, brought to his attention by this announcement from the UK IPO dated today (26 January).  The announcement says in part,
"IPeuropAware is holding its next [Implying that there have been previous ones?] free intellectual property rights event for SMEs on Wednesday 27 January 2010 at Manchester United’s Old Trafford Stadium. 
The event aims to ensure local businesses recognise the value and importance of IP, and are aware of the help that is available to protect them. The day will focus in particular on the textiles, clothing, footwear and leather industries. 
All attendees will receive a new guide; tailored to these industries is packed full of information about IP and how businesses can enforce their rights. 
A new website, ‘InnovAccess’ will also be launched, providing free up to date information and support on all important IP matters for SMEs in Europe."
The IP minister, David Lammy, excitedly states that the event provides the perfect platform to give SMEs access to free, local and expert advice on intellectual property and how they can exploit their assets and creativity. Mr Lammy thinks it’s great to know that this opportunity is available to people and that they are being shown how to use their statutory rights to benefit their business, their customers and the economy.

The IPKat tends to agree, but wonders how many SMEs will be able to respond to the announcement and get themselves to Old Trafford by tomorrow. He also wonders if any patent attorneys will be there, but suspects that they might have been left out of this particular loop.

More exciting (to some) things happening at Old Trafford here and here.

Butters in court, as IP deal trumps public policy

A news flash from London-based law firm Herbert Smith brings tidings that the Court of Appeal for England and Wales has today reversed the decision of Mr Justice Peter Smith in Butters and others v BBC Worldwide Ltd and others (noted here on IP Finance, with a short summary of the facts). The trial judge had held that contractual provisions in a joint venture agreement, when taken together with termination provisions in an IP licence, were void since their effect was to deprive creditors' access to assets on an insolvency and was therefore contrary to public policy.

The trial judge sought to apply what is known as the "anti-deprivation principle". By this principle there cannot be a valid contract that a man’s property shall remain his until his bankruptcy but that, on the happening of that event, the propertyy goes over to someone else, and be taken away from his creditors. In the judge's view the interlinking of (i) a provision in a joint venture agreement that, on the occurrence of the insolvency of one JV partner or a member of its group, the other JV partner was entitled to serve a notice to acquire all of the shares in the joint venture company, with (ii) a provision that terminated a valuable IP licence on the service of that notice, had the effect of depriving assets from creditors and were therefore void.

The Court of Appeal disagreed, saying that these interlinked provisions were unobjectionable, even if it took effect after the insolvency of the licensee, since their operation merely involved the termination of the licensee's limited interest. The provision in the JVA provided for the shares to be acquired, in effect, at market value, which could not be objectionable. On the basis that each provision was independently acceptable, their combination could not be objectionable merely by virtue of their coexistence. The Court of Appeal added that the anti-deprivation rule does not apply where the deprivation has been effected by the time the winding-up (or administration) order is made against the company which is deprived. In other words, the anti-deprivation rule can in any event be avoided by careful drafting.

The authors of this news flash note the statement of the Court of Appeal that it was ultimately up to Parliament to legislate against anti-deprivation devices in the insolvency field, as it has already done in sections 238 (transactions at an undervalue) and 239 (preferences) of the Insolvency Act 1986.

Says the IPKat, while careful drafting can side-step the anti-deprivation principle, this is just the sort of thing that can be missed during the adrenalin rush to sign the JV which drives its parties, dragging their lawyers in their wake, towards the first document that appears to reflect the main items on which agreement has been reached. Says Merpel: tricky issue, trial judge reversed on appeal, public policy issues relating to the protection of creditors -- does anyone fancy an appeal to the Supreme Court?

This decision had not yet been posted on BAILII at the time the news flash was received and this item posted.

Anti-deprivation here (not for the hard-hearted)
Monetary deprivation here
Sensory deprivation for $50 an hour here

Big surprise in Lego trade mark dispute: AG refers to logical business expectations

This morning Advocate General Mengozzi delivered his Opinion to the Court of Justice of the European Union in a case eagerly followed by all parents of small children who enjoy playing constructively with their toys -- Case C‑48/09 P Lego Juris A/S v Office for Harmonisation in the Internal Market and MEGA Brands, Inc. The background to the dispute is summarised by the Advocate General in his Introduction:

"‘2. This is an appeal by Lego Juris A/S (‘Lego Juris’) against the judgment of the Court of First Instance of 12 November 2008 in Case T‑270/06 Lego Juris v OHIM. It does not involve assessing the merits of Lego, whose instructional value and value in fostering logic and creativity are undoubted, but rather ascertaining whether the Court of First Instance’s interpretation of the Community trade mark legislation and of the only precedent of the Court of Justice are vitiated by the errors alleged by Lego Juris.

3. The Lego company and its main competitor, MEGA Brands, dispute whether it is possible to register as a trade mark a photographic representation of a typical Lego brick or whether its design contains essential characteristics of the shape of the brick which, because of their functionality, must remain available to any toy manufacturer and are therefore prohibited from registration".
After Lego secured registration of the illustration of the toy brick shown here, Mega Brands successfully sought cancellation of the registration. The decision of the Cancellation Division was upheld by the Board of Appeal, whose decision was in turn upheld by the Court of First Instance. In this, the final appeal, Lego Juris based its claim on three grounds:

"... the judgment under appeal provided an incorrect interpretation of Article 7(1)(e)(ii) of Regulation No 40/94 that bars from trademark protection all shapes which perform a function, independently of whether the criteria of that provision are fulfilled or not. It submits that the Court of First Instance departed from the judgment in Philips, in which the Court of Justice distinguished between ‘technical solutions’ and ‘technical results’, associating the requirement to maintain availability with technical solutions so that competitors are not obliged to seek different solutions leading to the same result, but calling on them to find different shapes using the same solution. That misinterpretation on the part of the Court of First Instance led it to hold that the functional shape itself must be available to all, whereas it is apparent from the judgment in Philips that only the functional characteristics of the shape itself must be available to all.

46. Second, ... the judgment under appeal used incorrect criteria in order to ascertain the essential characteristics of three-dimensional signs. Where a trade mark right is used effectively, the concept of ‘essential characteristics’ is synonymous with that of ‘dominant and distinctive elements’, which must be assessed from the perspective of the average consumer who is reasonably well informed and reasonably observant and circumspect. However, ... the Court of First Instance disregarded the rule that the perception of the consumer must be taken into account, following the circular approach of determining the essential characteristics precisely from the task performed by various parts of the shape.

47. Third, ... the judgment under appeal [uses] incorrect functionality criteria. It submits that the best way to assess whether a specific characteristic of the shape of an object fulfils a function is to alter that characteristic. If altering it has no impact on the function, then that characteristic is not functional. In that context, alternative shapes must be taken into account, since they would show that the grant of a trade mark in respect of a specific shape will not lead to a monopoly, and thus the shape is not caught by the absolute prohibition on registration contained in Article 7(1)(e)(ii) of Regulation No 40/94".

At this point, the IPKat respectfully reminds his readers that we are talking about a picture of a plastic interlocking toy brick and that there would appear to be a degree of over-intellectualisation of the issue which sometimes makes one think that, if you haven't got a clearer argument than these ones, you're probably going to lose. Anyway, not to be outdone, the Advocate General thought he'd do a bit of intellectualising of his own, laying down the methodology by which Lego's appeal would be measured:
"49. It is necessary in the present appeal to explain to economic operators the relevant criteria for registering as a trade mark the shapes of goods which are adapted to the technical functions which they must perform.

50. Undoubtedly the judgment in Philips set out the principles for interpreting the provision at issue, albeit by reference to the directive. However, the facts of that case resulted in a somewhat emphatic judgment as regards the registrability of signs composed of functional shapes. It is apparent from the judgment that there was a certain consensus that the graphic representation of the head of the electric shaver marketed by Philips was purely functional.

51. By focusing so narrowly on the facts of the case, the reply from the Court of Justice to the Court of Appeal (England and Wales) emphasised the grounds on which it was appropriate to refuse registration of a mark having those characteristics, but it scarcely set out for undertakings the guidelines for registering functional signs as trade marks. The judgment, faithful to the spirit of the legislation, did not absolutely preclude marks composed of functional shapes from being registered, although it did not make this easy. To use a metaphor, the Court did not close the door on registering functional signs, but rather left it ajar; and this appeal must determine the size of the gap left by that half-closed door.

52. ... the appeal must consider both substantive aspects, that is to say the possible errors of interpretation, and methodological aspects, namely the modus operandi for assessing the characteristics of objects and defining their functionality.

53. I believe that there has been only one precedent, and that this appeal is the second opportunity in 10 years for the Court to explore the intricacies of the provision at issue, which justifies the attempt to provide a reply which goes beyond the limits imposed by the grounds of appeal put forward by the appellant, before then examining those grounds. Furthermore, I hope thereby to meet the logical expectations of the business community as to the requirements for registering functional signs, which is anxious to receive clarification on this complex issue".
Applying his methodology, the Advocate General recommends rejecting all three grounds of appeal and affirming the decision of the Court of First Instance.

The "logical expectations of the business community" -- the IPKat welcomes the Advocate General's recognition of the importance of this concept, but wonders (i) why it has taken so long for the ECJ to be introduced to this very practical notion, (ii) who is the custodian of the interests of the business community before the ECJ and (iii) how many of the members of the court will be responsive to it? [Merpel bets the words "logical expectations of the business community" -- which have never appeared online until this very day -- will not appear in the Court's final judgment].

Business logic here
Cat logic here
Legal logic here

Subscribe to the IPKat's posts by email here

Just pop your email address into the box and click 'Subscribe':