Does the Court of Appeal's 2:1 split in Thaler underline the need for legislative review?

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Can machines be inventors? The US, the European Patent Office, and Australia all have considered this question. None of their decisions however are helpful in the UK, since the relevant statutory provisions in those disputes were different from the law of the UK.  This point was made by the Court of Appeal at [94]-[96] of their recent judgment in Thaler v Comptroller [2021] EWCA Civ 1374 which IPKat friend friend, Brussels-based trainee patent attorney, Henry Yang, breaks down and cuts through the noise for our readers.

Over to Henry:

"Background

Dr Stephen Thaler is the inventor of an artificial intelligence machine called DABUS. DABUS made inventions. When applying for a patent in the UK, if the applicant is not the inventor it is required to file the statement of inventorship under s.13(2) of the UK Patents Act 1977 to indicate how the applicant derived the right from the inventor to be granted a patent. For his patent applications Dr Thaler replied ‘by ownership of the creativity machine “DABUS”’ ([6]). The UK Intellectual Property Office considered that the statement of inventorship did not satisfy s.13(2) and consequently the applications were deemed withdrawn ([1]).

Dr Thaler appealed to the English High Court which dismissed the appeal for three reasons ([18]). First, the natural meaning of s.7(3) was that the inventor is a person ([19]). Also, the 1977 Act was based on the footing that patents can only be granted to persons. s.7(2)(a)(b)(c) only concern persons since only persons can have, grant, or be granted rights ([21] – [22]). As DABUS was not a person it could not be an inventor. Secondly, s.7(2)(b) and (c) both require the inventor to transfer the right to apply to the applicant. As DABUS was not a person, it could not have done that ([23]) and thus Dr Thaler failed to establish the right to be granted the patent. Thirdly, the UK Intellectual Property Office was correct to find that the applications were deemed withdrawn under s.13, because if all that is needed from the applicant under s.13 is honest but ill-founded belief in his right to grant, this would render s.7 useless ([25]).

Judgment

In a 2-1 split, Arnold and Elisabeth Laing LJJ dismissed the appeal. Birss LJ dissented and would have allowed it. The recording of the hearing is available here (morning) and here (afternoon).

Statutory framework

Modern patent law is almost entirely a creature of statute’ ([136]; also [100]). It is thus central to examine the relevant statutory provisions. Two sections of the 1977 Act are key in this case ([9]). s.7 provides:

"Right to apply for and obtain a patent.

(1) Any person may make an application for a patent either alone or jointly with another.

(2) A patent for an invention may be granted—
(a) primarily to the inventor or joint inventors;
(b) in preference to the foregoing, to any person or persons who, by virtue of any enactment or rule of law, or any foreign law or treaty or international convention, or by virtue of an enforceable term of any agreement entered into with the inventor before the making of the invention, was or were at the time of the making of the invention entitled to the whole of the property in it (other than equitable interests) in the United Kingdom;
(c) in any event, to the successor or successors in title of any person or persons mentioned in paragraph (a) or (b) above or any person so mentioned and the successor or successors in title of another person so mentioned;
and to no other person.

(3) In this Act “inventor” in relation to an invention means the actual deviser of the invention and “joint inventor” shall be construed accordingly.

(4) Except so far as the contrary is established, a person who makes an application for a patent shall be taken to be the person who is entitled under subsection (2) above to be granted a patent and two or more persons who make such an application jointly shall be taken to be the persons so entitled."

s.13 states:

"Mention of inventor.

(1) The inventor or joint inventors of an invention shall have a right to be mentioned as such in any patent granted for the invention and shall also have a right to be so mentioned if possible in any published application for a patent for the invention and, if not so mentioned, a right to be so mentioned in accordance with rules in a prescribed document.

(2) Unless he has already given the Patent Office the information hereinafter mentioned, an applicant for a patent shall within the prescribed period file with the Patent Office a statement—

(a) identifying the person or persons whom he believes to be the inventor or inventors; and (b) where the applicant is not the sole inventor or the applicants are not the joint inventors, indicating the derivation of his or their right to be granted the patent;

and, if he fails to do so, the application shall be taken to be withdrawn.

(3) Where a person has been mentioned as sole or joint inventor in pursuance of this section, any other person who alleges that the former ought not to have been so mentioned may at any time apply to the comptroller for a certificate to that effect, and the comptroller may issue such a certificate; and if he does so, he shall accordingly rectify any undistributed copies of the patent and of any documents prescribed for the purposes of subsection (1) above."

Birss LJ

Birss LJ summarised the grounds of appeal into three questions ([27]):

i) Does the 1977 Act require that an inventor be a person?

ii) What is s.13 of the 1977 Act for, and how does it work?

iii) What is the right response to the information Dr Thaler has provided under s.13(2)? 

To analyse these issues Birss LJ first examined the legislative history for the interpretation of the 1977 Act ([32] – [46]), summarised in [47] as i) The inventor was limited to the person actually devised the invention; ii) Patent applications can be made by anyone. When the patent office grants a patent it is not ratifying the applicant’s claim to the grant; iii) The applicant is only required to state whom he believed to the inventor; iv) Arguments as to entitlement to the grant is to be resolved by a separate procedure initiated by the person disputing ownership.

i) Does the 1977 Act require that an inventor be a person?

The legislative history showed that s.7(3) required the true and first inventor to be the actual deviser of the invention ([50]). Since the actual deviser is a person (see [38] and [47] i)) and is thus the inventor under the definition of s.7(3), the inventor must be a person ([51]). In addition, if inventors do not have to be persons this contradicts the argument that other provisions in the 1977 Act which refer to inventors as persons positively require that the inventor must be a person ([52]).

ii) What is s.13 of the 1977 Act for, and how does it work?

Birss LJ considered that all that s.13(2) requires is that the applicant must identify who he believes is the inventor ([58]). s.13(2)(a) is satisfied if the applicant states his genuine belief as to who the inventor was ([60]). For s.13(2)(b), Nippon Piston Ring [1987] RPC 120 provided helpful insight. According to Nippon Piston Ring no great detail is required to satisfy s.13(2)(b) ([65] – [66]); the purpose of the twin requirements to identify who is believed to be the inventor and to indicate how the title is derived is for appearance on the public record ([67]), an interpretation thought to be consistent with the legislative history ([68]).

For the present case, Birss LJ considered the Judge wrong who had held that any granted patent can be revoked if it does not satisfy s.7, because this ground of revocation is only available when a third party already held entitled to the grant by the court initiated the request ([70]). Birss LJ indicated that two further matters supported his interpretation. One is that under the 1977 Act deemed withdrawals happen when the applicant fails to file documents while refusals occur when applications do not comply with the 1977 Act ([73]). The failure to file s.13(2) information logically leads to a deemed withdrawal rather than a decision on the merits about the applicant’s entitlement ([74]). Second is that third parties’ observations only concern patentability, not entitlement ([75]).

iii) What is the right response to the information Dr Thaler has provided under s.13(2)? 

Birss LJ considered Dr Thaler to have complied with the s.13(2)(a) requirement. s.13(2) cannot be found to be unsatisfied if it is clear why no name had been provided and the applicant was giving his genuine belief. The Comptroller in this case does not have to mention any name on the patent as the inventor ([80]). It is also notable that inventors, here it potentially being Dr Thaler, can waive his right to be mentioned under s.24(3), and Dr Thaler should be regarded as having waived whatever right to be mentioned that he had ([81]).

On s.13(2)(b) Birss LJ considered it satisfied as well. He held it unnecessary to examine whether there is indeed such a rule of law (Dr Thaler contended he had derived his right to the grant under s.7(2)(b)) that the owner and operator of an invention-creating machine is entitled to apply for a patent for that machine’s invention ([84], [82]). If someone thought he has a better right than Dr Thaler he could come to the Comptroller to establish that he should be entitled to the grant instead ([83]). Also on such a rule of law, Birss LJ said in obiter that it did not have to be found in the Act itself ([91]).

Another reason why the Comptroller should not have jurisdiction to evaluating the claim to derivation is that this would bring back s.32(1)(b) of the Patents Act 1949 or argue about fraud on the patent office ([86]).

Arnold LJ

Arnold LJ also summarised the present case into three issues, albeit slightly differently to Birss LJ:

i) Does DABUS qualify as an ‘inventor’ within the meaning of the Patents Act 1977? 

Upon a systematic interpretation of the 1977 Act Arnold LJ held that only a person can be an inventor ([116]): s.7(2)(a)(b)(c) all require inventors to be persons ([116]); s.2(4) refers to ‘from the inventor or from any other person’ ([117]); s.8 makes it clear that only persons can be entitled to the grant ([119]); s.13(1) confers a right upon the inventor or joint inventors, and only persons can have rights ([121]); s.13(2)(a) requires the applicant to identify ‘the person or persons whom he believes to be the inventor or inventors’, making it implicit that only persons can be inventors ([122]). Accordingly DABUS was not an inventor since it was not a person ([123]).

ii) Is Dr Thaler entitled to apply for patents in respect of the inventions? 

Dr Thaler contended that he was thus entitled under s.7(2)(b) ([124]). Arnold LJ cited case law to point out that an invention is a piece of information, and that there is no property in information even if confidential ([125]). The parties appeared to agree that what s.7(2)(b) means by ‘the whole of the property in [the invention]’ was the entitlement to file an application ([128]).

Dr Thaler relied on the common law doctrine of accession as the rule of law in s.7(2)(b) ([130]). But there is no authority that the rule of accession applied to intangible property (here the entitlement to file an application) produced by tangible property (here DABUS) ([130] – [134]). This is logical, because the rule of accession was based on one’s ability of exclusive possession of both the pre-existing tangible and the new tangible, while neither can new intangible property be exclusively possessed nor does exclusive possession of the intangible follow from exclusive possession of the pre-existing tangible ([133]). As illustration if A takes a digital photo with B’s camera, then A may own copyright in the photo but not B; B does not own the data stored in the cloud either ([135]). As modern patent law is based almost wholly on statutes ([136]), the lack of any rule of law that a new intangible produced by a pre-existing tangible is the property of the owner of the original tangible was fatal to Dr Thaler’s contended entitlement ([137]).

iii) Was the hearing officer correct to hold that the applications are deemed to have been withdrawn by virtue of s.13(2) of the 1977 Act?

Arnold LJ disagreed with Birss LJ’s conclusion from Nippon Piston Ring ([140]). Arnold LJ considered that case as laying down the condition that the s.13(2)(b) requirement cannot be ignored. The Comptroller’s role included checking whether the filed statements appeared to comply with the statutory requirements or were bad on their face ([142]). Here, not only did Dr Thaler deliberately identified a non-person as the inventor ([143]), he also failed to indicate how he derived his right to the grant as he had simply relied on his possession of DABUS ([144]). As such the hearing officer was right to deem the applications as withdrawn ([148]). In addition, contrary to the opinion of Birss LJ in [60] Arnold LJ considered that another purpose of s.13(2)(a) is to give effect to the inventor’s paternity right (the right to be identified as the creator of something) conferred by s.13(1). Yet machines cannot have rights ([146]).

Elisabeth Laing LJ

After agreeing with Birss and Arnold LJJ that an inventor must be a person ([102]), Elisabeth Laing LJ held that the s.13(2)(a) requirement was not satisfied when Dr Thaler positively stated that the inventor was not a person ([105]). Contrary to [60] by Birss LJ, stating one’s genuine belief about who the inventor was was not considered to satisfy the s.13(2)(a) requirement by Elisabeth Laing LJ; instead the applicant needs to identify the person who he believes to be the inventor ([108]). This was enough to dismiss the appeal ([108]).

In obiter Elisabeth Laing LJ also disagreed with Birss LJ that the only purpose of s.13(2) is to provide the Comptroller with information which will be published ([109]), and agreed with Arnold LJ that Dr Thaler’s contention that he acquired the right to the patent by ownership of DABUS did not indicate a derivation of the relevant right known to the law ([111]).

Comments

The Court of Appeal was unanimous that under the current law machines cannot be inventors. The source of this position was that when enacting the 1977 Act Parliament did not have it in mind that machines could make inventions ([103]). Consequently even if this case continues to the highest court, whether a machine can be the inventor is ultimately a policy question which Parliament is better positioned to answer. On one hand recognising machines as a new class of inventors may promote innovation in the UK; on the other this may create numerous issues which with machines assuming the place previously occupied only by humans can prove tricky: a key problem is that machines may churn out inventions but have no rights. A potential question could be how to consent to transferring the right to the grant if a machine and a person jointly contributed to an invention?

To solve the difficulty that machines do not have rights I think it would be necessary to link an inventive machine to a person in some way, such that the person can act on behalf of the machine. I had also argued that it is probably not entirely right to regard a machine as the sole inventor sui juris. in AI, teaching a machine how to innovate (a role of human beings) is at least just as important as the innovation process itself carried out by the machine.

Finally for countries under a centralised granting system such as the European Patent Convention states, it is desirable to achieve at least some degree of harmonisation among them on whether to recognise machines as inventors. Otherwise a granted patent by the central agency may be regarded as deficit in one country where it is subsequently in force, causing legal uncertainties both to the patentee and to third parties.

In response to the call for views on artificial intelligence and intellectual property, the UK government indicated in March 2021 that it would launch a consultation later this year on how to protect inventions created by artificial intelligence machines which do not qualify as inventors. Potential options included legislative changes. Courts are bound to interpret the law as it is. In order to make it recognised a new class of inventors which had not been in the mind of the previous legislature it is probably more effective to argue for a change in the law, if one is needed."