Friday 26 April 2024

Conquest Planning: Estoppel & res judicata

There has been some excitement over the past few months among the very niche community of UK patent attorneys specialising in AI, following the High Court judgment of Emotional Perception. I wrote about the case here and it was also written about in a slightly more approving way by one of my work colleagues. It was inevitable while the judgment still stood (an appeal is currently pending with a hearing at the Court of Appeal scheduled for May 2024) that attempts would be made to get applications relating to AI through the UK IPO that would previously have been considered unpatentable, particularly given the change in practice in light of the judgment. At least one such attempt has been made, which has resulted in the decision last month in the case of Conquest Planning Inc. (BL O/0259/24). 

The application, GB2311361.6, was a divisional of an earlier UK application that was a national phase entry of PCT application PCT/CA2020/050275. The abstract on the cover page of the published PCT application is probably enough for the reader to have a good guess as to where this, originally Canadian, application was going to go in Europe. This described the invention as "a financial planning system that comprises a Strategic Advice Manager (SAM) module that utilizes an artificial intelligence (AI) module to automate and optimize the financial planning decision-making process". Unsurprisingly, in decision BL O/988/23 from 24 October 2023, the application was refused because the hearing officer found the claimed invention to be a tool for recommending financial plans in which an AI module was used. This related entirely to an administrative process that was computer-implemented but made no improvements to a computer in a technical sense. This resulted in the invention being found to be excluded under section 1(2) for being a method for doing business and a program for a computer as such. The fact that the invention made use of a computer program did not impart any technical contribution, following the usual reasoning from Aerotel/Macrossan and AT&T/CVON

Probably expecting this negative result, the applicant had already arranged for a divisional to be filed in July 2023. This application then faced similar objections from the examiner and eventually (although rather more quickly this time, due to the compliance period coming up) came before a hearing officer after the examiner decided that the claims on file as of 8 December 2023 were not patentable for essentially the same reasons as were already provided in the earlier decision. By that time, however, the Emotional Perception judgment had come out, so the applicant ran the argument before the hearing officer that, because the application related to AI, the change in practice should be taken into account. A question then was whether the applicant was trying to have a second go at getting the same invention patented. The issue to be considered was what bearing the previous decision had on the divisional application. The hearing officer noted that, in a previous decision BL O/033/09 (Rajesh Kapur), the principle of estoppel was found to apply to ensure that litigation was final and could not be subsequently fought all over again. The Patents Hearing Manual notes at points 1.96 and 1.97:

"Estoppel by record (doctrine of res judicata) applies where a relevant judgment (and that includes a decision of a tribunal such as the comptroller) has already been given. The judgment stands forever, as between the parties unless it is modified by the normal course of appeal (in which case the modified judgment stands in its place). For example, in an infringement action (Poulton v Adjustable Cover & Boiler Block co (1908) 25 RPC 529 the plaintiff was awarded damages which were ordered to be assessed and paid by the defendant in due course. However, before the damages had been paid, the defendant caused the patent to be revoked on the basis of new evidence. Accordingly, he argued that he need no longer pay the original damages since the patent must, at the time of the first action, have been invalid. He was however held to the terms of the first decision. This judgment although old remains good law - see Coflexip SA v Stolt Offshore MS Ltd (No 2) [2004] EWCA Civ 213, [2004] FSR 34, discussed below with regard to abuse of legal process. See also Unilin Beheer BV v Berry Floor NV and Others [2007] EWCA Civ 364 in which it was decided that a later finding of invalidity of an EP(UK) patent in an EPO opposition would not disturb a finding in the UK Courts that the patent was valid and infringed as between the parties in the UK action, so that any damages must still be paid.
There are two types of estoppel by record. The first is "cause of action" estoppel where the same cause of action lies in a final judgment (cf the example given above). The second is issue estoppel which, per Lord Denning in Fidelitas Shipping Co Ltd's v vlo Exportchleb [1966] 1 QB 630 at p640, applies where, within one cause of action, there are several issues raised which are necessary for the determination of the whole case. Once an issue has been raised and distinctly determined (even if the question was in fact not the subject of any dispute or argument) then as a general rule neither party can be allowed to fight that issue all over again. But not always - cf, for example, Rose Bro's (Gainsborough) Ltds Appln [1960] RPC 247 and Hodgkinson & Corby Ltd & anr v Wards Mobility Services Ltd [1997] FSR 178. Cinpres Gas Injection Limited v Melea Limited [2008] EWCA Civ 9 contains a discussion of the difference between cause of action and issue estoppel - see paragraphs 66 to 77. Estoppel was not established in that case, the judgment holding that there had been perjury by a witness closely identified with one of the parties; (see paragraphs 105 to 107), and adoption of the fraud by the party itself; (paragraphs 108 - 120)."

As a result, the hearing officer found that the applicant was prevented from asserting that the claimed invention was outside of the exclusions from patentability if the scope of those exclusions remained unchanged. Did the Emotional Perception judgment change the scope of the exclusions though? The judge had found that a system for recommending data files using an artificial neural network (ANN) was not excluded as a computer program. The claimed invention in this case involved the step of training an artificial intelligence to develop a financial plan, which the applicant argued was sufficient to determine the question of patentability in their favour. The hearing officer, however, found that this did not relate to a trained ANN or to the training of a ANN but instead to a generic AI. It could not therefore be said to engage the exclusions raised in Emotional Perception. Given the identical facts and identical law, the previous decision must be followed. The application was therefore refused. 

The lesson here then is that, although there may have been a change in practice in light of Emotional Perception, the effect while the judgment stands is likely to be very limited, being specific to the question of whether an ANN can be considered to be a computer program as such. If the claimed invention does not relate specifically to an ANN, the change in practice is not going to be of much use. Another point to note is that the other exclusions, in particular that relating to business methods, will still apply, so even if the computer program exclusion is avoided there may be others that can still prevent a patent being granted. 

Friday 26 January 2024

If you like this ...

I was hoping that someone else would by now have critically analysed the recent High Court judgment in Emotional Perception AI Ltd [2023] EWHC 2948 (Ch), which issued on 21 November 2023, but it appears that nobody has yet. There has been a recent article in the CIPA Journal, but the less said about that the better. Even the IPKat has said nothing about it so far, which is a pity. It appears therefore to fall to me to do the necessary explanation and (to give the game away somewhat) point out that the judgment is a definite outlier and is not in line with higher level case law, including several judgments from the Court of Appeal, nor is it in line with case law at the EPO. There have been several articles published that have, rather excitedly, announced the judgment as some kind of breakthrough for AI inventions because it finds, in effect, that a trained artificial neural network (ANN) is not a program for a computer under section 1(2) of the Patents Act 1977. This is, of course, in reality complete nonsense. As a consequence, the reasoning goes, this will result in AI inventions now being much more patentable than they were before. The UK IPO have even changed their practice to instruct their examiners that, as from 29 November 2023, objections should not even be raised to inventions involving an ANN for excluded subject matter. This is great news for inventors working in the field of AI who want patent protection (which may not be all of them), and also great news for their patent attorneys. I, however, am not so sure it will work out well in the longer run, and suspect this will be a temporary aberration, although I may of course be wrong.

I have been following case law on patentability in the UK and at the EPO for the past 17 years or so, coincidentally starting roughly around the time of the Court of Appeal judgment in Aerotel/Macrossan [2006] EWCA Civ 1371, which issued while I was sitting my UK Finals in 2006. Looking at my IPKat posts from around that time (see here for example), there was much discussion in the follow-up to Aerotel about whether the 4-step test was actually in line with the EPO, which instead applied the problem-solution approach according to Comvik (T 641/00). After a bit of disagreement about the validity of computer program claims (see here), the issues in the UK appeared to settle. Although the tests applied at the UK IPO and the EPO are very different, the core issues are essentially the same, which is whether there is a 'technical effect' (which I wrote about in 2013 here). I have revisited this several times in the intervening years, most recently when writing a chapter for the IPKat's 20th anniversary book. Although there has been some tinkering around the edges, the general principles have not really changed for at least 10 years and, for better or worse, have been applied with reasonable consistency by the UK IPO. These principles can be found in any of the numerous decisions that have come from UK IPO hearing officers, which I have had the dubious pleasure of reviewing for the CIPA journal for the past 17 years. You may even have read one or two of my reviews, although I suspect very few people do.

Firstly, according to Aerotel/Macrossan, the way to deal with 'excluded matter' under section 1(2) (i.e. things that are not inventions for the purposes of the Act), was to: 

i) properly construe the claim; 

ii) identify the contribution (which may be the actual or alleged contribution, depending on whether a search has been performed); 

iii) ask whether the contribution falls solely within excluded matter; and 

iv) if step iii) hasn't already covered it, check whether the contribution is actually technical. 

Secondly, in considering whether a computer program makes a technical contribution, the later decision in AT&T/CVON, which was supported and slightly amended by the Court of Appeal judgment in HTC v Apple [2013] EWCA Civ 451, set out the following five 'signposts', any one of which may indicate the presence of a technical contribution according to step iv) of the Aerotel test:

i. Whether the claimed technical effect has a technical effect on a process which is carried on outside the computer. 

ii. Whether the claimed technical effect operates at the level of the architecture of the computer; that is to say whether the effect is produced irrespective of the data being processed or the applications being run. 

iii. Whether the claimed technical effect results in the computer being made to operate in a new way. 

iv. Whether the program makes the computer a better computer in the sense of running more efficiently and effectively as a computer. 

v. Whether the perceived problem is overcome by the claimed invention as opposed to merely being circumvented.

It is worth noting at this point that, although Kitchin LJ stated, "these are useful signposts [...] But that does not mean to say they will be determinative in every case", in practice at the UK IPO, rightly or wrongly, these signposts have been determinative in every case where they have been applied. There has not been a single case where the signposts have been used and yet the invention has still been found to have a technical contribution. I would certainly have noticed and pointed it out with great excitement if there had been. To at least a first approximation therefore, if the contribution in a computer-implemented invention is not found to be within at least one of the signposts, it is not patentable.

With that all established, a computer-implemented method in a patent application such as the one put forward by Emotional Perception AI Limited (previously known as Mashtraxx Limited), would be expected to face a difficult time in getting granted. The application itself related to a method of training and implementing an ANN to identify a pair of similar data files, a particular example being music files. In simple terms, the claimed invention was about matching data files based on closeness of written descriptions and of the data itself. The actual claimed invention is a classic example of technical obfuscation, with the latest version of claim 1 reading as follows:

The IPO examiner objected that the claimed invention was not patentable because it related to a mathematical method and a computer program as such, objecting that the contribution made by the claimed invention (leaving aside clarity and sufficiency issues with claim 1) was to software for training an ANN to identify similar files by extracting measurable signal qualities from two files, assembling a multidimensional feature vector for each file based on these qualities, determining the distance between the two vectors and adjusting the ANN's weights to provide a measure of similarity between the files. In effect, the invention (in my words, not the examiner's) was about analysing music files to provide an output of the type "if you like this, then you might also like this". The examiner found that this did not solve a technical problem, and especially not a technical problem within a computer. The invention was computer-implemented, but used conventional hardware that was programmed to perform a non-technical function. It was not directed to a process outside of the computer, nor did it form part of the internal workings of the computer. In conclusion, the examiner found that the invention was "directed to an excluded process and there is nothing more to it" (examination report 13/10/21, page 10/11). 

After reaching this impasse with the examiner, the applicant then went for a hearing before the (very experienced) hearing officer Phil Thorpe. Among the arguments run by the applicant, one involved a comparison with the seminal EPO Board of Appeal decision from 1986 of Vicom (T 208/84), which decided that an image processing algorithm could be technical because the output was an improved image, which was considered to be technical. The hearing officer did not, however, consider that the comparison was a good one, because in this case there was no change to the data files, but only an output that provided an indication of a pair of semantically similar files. The claimed invention, in the hearing officer's view, did not therefore define a technical process and the contribution was found to relate wholly to a computer program as such, resulting in the application being refused. 

At that point, I would expect any normal applicant to give up and take the loss, given the very low hit rate of getting computer-implemented inventions facing excluded matter objections granted at the UK IPO. In this case, however, the applicant and their attorney did not give up and instead took the matter to appeal before Sir Anthony Mann in the High Court. Although obviously a highly experienced legal mind, Sir Anthony has not come to my attention at all previously in the area of patent cases, let alone the highly specialised area of patentability of computer-implemented inventions. As it turns out, this is I think one of the key problems with the judgment. 

Sir Anthony first set out how he understood the invention, which he considered could be envisaged as a 'black box' "which is capable of being trained as how to process an input, learning by that training process, holding that learning within itself and then processing that input in a way derived from that training and learning" (paragraph 3). He then described the claimed invention as being an improved system for providing media file recommendations to an end user, particularly for music files, the advantage of which was to offer suggestions of similar music in terms of human perception and emotion by passing music through a trained ANN. Claim 1, which had been (rather confusingly) amended from the above claim 1 to a "system for providing semantically relevant file recommendations" was defined by Sir Anthony as "a product by process claim", while another independent claim defined a corresponding method, both defining the steps of training the ANN and providing an output of relevant files. My initial problem at this point is that claim 1 as presented in the judgment (see here) is not really a product by process claim, but is a system defined by its features of operation, which is not in line with how a typical product by process claim is defined (see for example the EPO Guidelines F-IV 4.12). 

My next problem with the judgment is Sir Anthony then going on to "assume for the moment that the ANN itself is a hardware system (as opposed to a software emulation)" (paragraph 8). Why this assumption is made is completely beyond me. There is no justification for it from the application, nor is there any sensible reason why the ANN would be assumed to be hardware. In the Court of Appeal judgment of Gale's Application [1991] RPC 305, which is supposed to be in line with the current Aerotel test, Aldous LJ found that putting instructions on hardware did not make an invention patentable. The invention in that case related to a new way of calculating a square root on a computer. Aldous LJ found that "if Mr. Gale's discovery or method or program were embodied in a floppy disc (software) neither the disc nor a computer into whose RAM that programs had been inserted could be patented, it must, in my view, follows that the silicon chip with its circuitry embodying the program (hardware) cannot be patented either" (para 332). Simply switching from software to hardware did not therefore, based on this reasoning, make an invention patentable if it did the same thing. Sir Anthony, however (who did not appear to be aware of this judgment as he made no reference to it, nor was it pointed out to him by the UK IPO) managed to change the argument about whether the invention in this case was patentable by arbitrarily assuming that the ANN was implemented on hardware and entirely ignoring the valid line of reasoning that this should make no difference. 

The next problem I have with the judgment is another apparent misunderstanding by Sir Anthony, apparently led by the applicant's representatives, where he came to the view that the ANN training model was not programmed to include all its detailed logical steps but adjusted itself through training to produce a model which satisfied the training objective. This led him to ask the question of where the computer program was that was said to engage the exclusion. This resulted in a confused bit of reasoning about where the program would be in the case of a hardware ANN (which had already been wrongly assumed), with the UK IPO's representative implausibly conceding that "there would in that case be no program to which the exclusion applies" (para 43). This inevitably resulted in Sir Anthony, having been well and truly led up the garden path by the applicant's attorney and the IPO's problematic representation, that there was in fact no computer program because the ANN was not operating on a set of program instructions at all but "was emulating a piece of hardware which had physical nodes and layers, and was no more operating or applying a program than a hardware system was". It becomes very difficult at this point to take the judgment seriously any more because the reasoning is so preposterous and wrong that anything further is bound to be wrong. And so it turned out to be, with Sir Anthony concluding that the ANN in substance operated at a different level from the underlying software on the computer and operated in the same way as a hardware ANN, resulting in the emulated ANN not being a program for a computer and therefore not excluded. 

Although it should not be necessary to point out to anyone reading this with any knowledge of computers at all, the single major flaw in the reasoning of this judgment is that the ANN, whether in hardware or software, would in actual fact be defined by software in the form of computer code defining connections and weights of the ANN and how it operates. It should go without saying that computer software does not need to be written by a human being for it to be a computer program. Indeed, all computer software in the form it is ultimately used, i.e. object code, is not human readable at all but is a string of 1s and 0s that is only readable by a computer. It is still, however, a program for a computer within the meaning of section 1(2) or of Article 52(2) EPC. How the computer program is generated, whether this is by compilation of human-written source code or the result of a training process (or, in this case, a combination of both), is not relevant to whether it is considered a program for a computer. It is also not relevant, according at least to Gale's Application, whether the program is implemented on hardware instead of software. Both are defined by code that defines how hardware operates, either by programming a general purpose piece of hardware or by defining a specific arrangement created or burned into circuit form in hardware.

As if the judgment wasn't wrong enough at that point, Sir Anthony then went on to decide whether there would be a technical effect to the invention, having nevertheless already decided that it wasn't excluded. After going through some of the usual case law on the subject, including the somewhat dubious decision in Protecting Kids, Sir Anthony went on to agree with the applicant that "moving data outside the computer system in the form of the file that is transferred [...] provides an external (outside world) effect". This is, of course, entirely out of line with all existing case law on the subject, both in the UK and at the EPO. Sir Anthony nevertheless went on to find that there was a technical effect in providing an (entirely unchanged) file selection to a user as an output of the claimed invention, and allowed the appeal. 

At this point, the only comment I have to add is the following:

Friday 8 December 2023

Does the EPO care about double patenting?

Although it has been a contentious issue in the past, the Enlarged Board of Appeal decision of G 4/19 clearly established that double patenting is not allowed. As the Guidelines for Examination G-IV 5.4 concisely puts it, "two patents cannot be granted to the same applicant with claims directed to the same subject-matter". G 4/19 provides a fuller definition of what is not allowed:

1. A European patent application can be refused under Articles 97(2) and 125 EPC if it claims the same subject-matter as a European patent which has been granted to the same applicant and does not form part of the state of the art pursuant to Article 54(2) and (3) EPC. 
2. The application can be refused on that legal basis, irrespective of whether it 
a) was filed on the same date as, or 
b) is an earlier application or a divisional application (Article 76(1) EPC) in respect of, or 
c) claims the same priority (Article 88 EPC) as the European patent application leading to the European patent already granted.

Given this clear guidance, one might expect that an examiner will raise an objection if, for example, an applicant files a divisional application with the same claim 1 that has already been granted on the parent application. This would be the clearest case possible of what is not allowed according to G 4/19, and something EPO examiners should be well aware of. As I have discovered recently, however, this does not appear to be the case. I have now found three examples of an applicant filing a divisional application with the exact same claim 1 that has already been granted on the immediate parent application, following which the search opinion has found no objections. These are: EP4092953, EP4184856 and EP4209954. Before you ask, the applications have different examiners but the same applicant. The first of these I have already written about here as it related to the question of when third party observations could have an effect. It turns out that double patenting, once it is pointed out, is in fact a serious enough objection that it can cause examination to be reopened after a communication under Rule 71(3) EPC has issued. This made me wonder whether examiners even check for this when preparing their search opinion for a divisional application. In all of the above three cases, it appears that the examiner did not because the search opinion in each of them simply stated:

This would, of course, be the case if the examiner was only looking for the usual things like novelty, inventive step, clarity and sufficiency because the same examiner had already examined the same claim for the parent application and found it allowable. 
Can anyone explain to me how a competent EPO examiner can examine the claims of a divisional application and entirely ignore the possibility of double patenting? In a related question, can anyone explain to me why an applicant would want to file a divisional with claim 1 in the exact same form as their recently granted parent application?

Sunday 19 November 2023

G 1/23 Referral - Is a marketed product prior art?

The question of whether something is made available to the public is fundamental to patent law. Article 54(1) EPC states that "An invention shall be considered to be new if it does not form part of the state of the art". Article 54(2) EPC then goes on to define what constitutes the state of the art, which is "everything made available to the public by means of a written or oral description, by use, or in any other way, before the date of filing of the European patent application". A product that is put on the market is made available to the public either by use or "in any other way", so such a product becomes part of the state of the art once on the market. A later filed patent application claiming the same product would consequently not be novel. 

There is a difference, however, between making available a product by placing the product itself on the market and making the same product available to the public by way of a disclosure, for example by publication of a paper or a patent application. In the latter case, the product itself is not disclosed but is only made available to the public if a skilled person would be able to reproduce the product based on what is disclosed. In other words, the disclosure needs to be enabling. This requirement does not (or at least should not) apply to a disclosure by placing the product on the market simply because the product itself is made available. Consequently, disclosure of the product by placing it on the market does not necessarily disclose to the skilled person how to make the product, while disclosure by publication is in effect the reverse, in that the disclosure must disclose to the skilled person how to make the product. 

Given the above, is there any question to be answered regarding whether a product is considered to be made available to the public if the skilled person might not be able to reproduce the product itself? One might think not, but this is in fact a live question that has been put before the EPO Enlarged Board of Appeal. Technical Board of Appeal decision T 438/19 has raised the following questions:
1. Is a product put on the market before the date of filing of a European patent application to be excluded from the state of the art within the meaning of Article 54(2) EPC for the sole reason that its composition or internal structure could not be analysed and reproduced without undue burden by the skilled person before that date? 
2. If the answer to question 1 is no, is technical information about said product which was made available to the public before the filing date (e.g. by publication of technical brochure, non-patent or patent literature) state of the art within the meaning of Article 54(2) EPC, irrespective of whether the composition or internal structure of the product could be analysed and reproduced without undue burden by the skilled person before that date? 
3. If the answer to question 1 is yes or the answer to question 2 is no, which criteria are to be applied in order to determine whether or not the composition or internal structure of the product could be analysed and reproduced without undue burden within the meaning of opinion G 1/92? In particular, is it required that the composition and internal structure of the product be fully analysable and identically reproducible?
Only question 1 is really of any significance. If this is answered in the negative, the other two questions are essentially pointless and don't add anything. Since it should be obvious by now that I think the answer to the first question should be a clear 'no', I will not even say anything about the other two. 

A first important point to note, which is key to answering question 1, is that it relates to a product and not to a method for making a product. In the patent in question, the product is a “material suitable as an encapsulating material for [a] solar cell” (claim 1 of the patent). The claims of the patent relate only to: i) the material itself; ii) a solar cell comprising the material; and iii) use of the material as an encapsulating material for a solar cell. There is no question regarding a method of making the material or whether such a method was made available to the public at any point. 

A second important point to note is that the alleged differentiating feature in claim 1 of the patent is only the final feature of claim 1, which is “a content of aluminum element of from 10 to 500 ppm”, the purported closest prior art disclosing all other features. Therefore, if the purported closest prior art is considered not to be excluded from the state of the art within the meaning of Article 54(2) EPC, the only question to be addressed is whether increasing the aluminum content to a value within the stated range would be obvious to the skilled person, and not whether a process of making the product in this way would be available to the skilled person. 

Thirdly, although the question of validity of the patent is one of inventive step, the question before the Enlarged Board is one only of novelty, i.e. whether the product was made available to the public before the priority date of the patent. The finding of the Enlarged Board will therefore have an effect on any case relating to whether putting a product on the market makes the product part of the state of the art for novelty or inventive step.

As a general principle, as outlined above, if a product has been put on the market and therefore made available to the public, any claim to the product itself in a later filed patent application would lack novelty. A distinction should be made between a claim to a product and a claim to a method of making the product. The former claim would be invalid over the making available to the public of the product, regardless of how the product was produced or whether the skilled person could have reproduced the product. The latter claim would only be invalid if the method of making the product was known by, or would be obvious to, the skilled person. A new method of making an existing product is patentable. The product itself produced by any other method cannot be patented a second time. 

The referral in this case stems from the following paragraph from the Enlarged Board’s reasoning in G 1/92
"An essential purpose of any technical teaching is to enable the person skilled in the art to manufacture or use a given product by applying such teaching. Where such teaching results from a product put on the market, the person skilled in the art will have to rely on his general technical knowledge to gather all information enabling him to prepare the said product. Where it is possible for the skilled person to discover the composition or the internal structure of the product and to reproduce it without undue burden, then both the product and its composition or internal structure become state of the art” (point 1.4 of the reasons). 
The referring board in T 438/19 indicates that the last sentence of the above passage “could appear to indicate that a product put on the market becomes state of the art and therefore available to the public only when the composition or internal structure of the product can be discovered and reproduced without undue burden” (point 8.2 of the reasons). This would, however, in my view be a misreading of both the sentence itself and the context in which it is used, which is in relation to whether a product can be reproduced. The sentence is only referring to the situation where, if the skilled person can reproduce the product without undue burden, both the product and its composition or internal structure become state of the art. The product itself is state of the art regardless of whether its composition or internal structure could be analysed, not least because the product in the same form would be an infringement of a claim to the product if placed on the market afterwards. The reference in G 1/92 to the skilled person being able to “reproduce it without undue burden” is therefore clearly referring to the skilled person being able to deduce how to “prepare the said product”, not to whether making the product available to the public before the priority date would be prior art for a claim to the product itself. This is regardless of whether the skilled person could reproduce the product with or without undue burden. The answer to question 1 must therefore be no

For a claim to a product, it does not matter whether the skilled person could or did reproduce the composition or internal structure of the product if the same product would be considered infringing if put on the market afterwards. A good example of this is the case of Merrell Dow Pharmaceuticals Inc. v H.N. Norton & Co. Ltd. [1996] RPC 76, a judgment from the UK House of Lords. The key finding of this was that a product (in this case an acid metabolite of an anti-histamine drug terfenadine) was made available to the public before the priority date of a patent to the product because it was an inevitable consequence of taking the drug terfenadine. Although the composition of the acid metabolite product was not made available to the public until after the filing date of the patent in question, following further research by the patentee, this did not matter. This was because, as Lord Hoffmann put it, “one cannot swallow terfenadine without shortly afterwards making the acid metabolite in one’s liver” (paragraph 7). Lord Hoffmann then quoted the Enlarged Board decision in G 2/88 (Mobil), which stated: “It is generally accepted as a principle underlying the EPC that a patent which claims a physical entity per se, confers absolute protection upon such physical entity; that is, wherever it exists and whatever its context (and therefore for all uses of such physical entity, whether known or unknown)” (point 5 of the reasons). Lord Hoffmann then went on to state that the consequence of this is that: “If the use would have been an infringement afterwards, it must have been an anticipation before”. (paragraph 25). If the Enlarged Board in G 1/23 were to find that such a principle was no longer applicable, this would allow patent claims to products already put on the market, thereby turning something that would previously not be an infringing product into an infringement. It ought to be clear that this would be a nonsense, and should not even require considering provisions such as Section 64 to allow what was done before to be continue to be done. I hope that the Enlarged Board see this and decide accordingly.

Monday 25 September 2023

J 5/23 - Electronic Signatures are Invalid

Back in December 2021, I wrote about electronic signatures in light of the then recently published notice from the EPO about them being used as evidence for registering a transfer of rights. Before going any further, I recommend reading my previous post so you are familiar with the concept of digital/electronic signatures, if you are not already. In brief, the situation at the time was that, if a digital signature was to be used it would need to comply with fairly strict requirements to pass the test of being considered valid. It was evident at the time, as I tried to make clear, that a mark on a document that appeared to be a digital signature, but without the required certification, would not pass the test. Evidently, however, not everyone realised this and attempts were made to record assignments at the EPO with such documents. European application 21204983.7, filed in the name of Gyrus ACMI, Inc., is one such example, and appears to be the first one on this issue that has resulted in an appeal decision. 

In March 2022, the applicant's representative filed a request pursuant to Rule 22 EPC to record a transfer of rights regarding the application. The registration fee was paid and the request was accompanied by an assignment document, purportedly signed by both parties. The signature part of the assignment document as submitted to the EPO looked like this:

Both signatures were evidently not done by hand, but an indication that the document had at some stage been electronically signed was provided by a DocuSign Envelope ID at the top of the assignment document, which looked like this:
It is impossible to tell from the EP register whether the document that was submitted was in fact the electronically signed version, since these documents are resampled versions and any signatures would be stripped out. However, it is evident based on what happened next that what was submitted was merely a dumb copy without any actual digital signatures, because an objection was raised shortly afterwards by the EPO Legal Division in a communication dated 24 March 2022, stating:

"With regard to the electronic signatures attached to the Patent assignment submitted on 14 March 2022, we are unable to access the electronic certificates attached to them. We therefore cannot assess whether the signatures fulfil the requirements set out in the notice from the European Patent Office dated 22 October 2021 concerning electronic signatures on documents submitted as evidence to support requests for registration of a
transfer of rights under Rules 22 and 85 EPO and requests for registration of a licence or other rights under Rule 23 EPC (OJ EPO 2021,A86).

Your attention is therefore drawn to the definition and requirements of a qualified electronic signature provided under Article 3(12), (15), (23) Regulation (EU) No 910/2014. Please note that the qualified electronic signatures must be electronically verifiable by an accessible qualified certificate attached thereto. Only the original (digital) format of the electronically signed document allows such verification. Scanned or similarly reproduced documents do not serve this purpose.

You are therefore invited to re-submit the document in question in PDF format bearing either a verifiable electronic signatures or a handwritten signatures within two months of notification of the present communication".

Rather than going back and getting a proper digitally signed document or one with handwritten signatures, the applicant's representative argued back to the Legal Division that, because the assignment document contained text string signatures from both parties, the document should be accepted. The Legal Division disagreed, pointing out that only documents bearing qualified electronic signatures within the meaning of Regulation (EU) No 910/2014 could be accepted, according to the EPO notice of 22 October 2021. Such signatures, as pointed out by the Legal Division, "must be electronically verifiable by means of a digital qualified certificate included in the document filed. Only the original, digital format of the electronically signed document permits such verification". After some more (rather pointless) arguments from the applicant's representative, a final decision was made on 23 February 2023 to reject the request for recordal. An appeal was then filed in March 2023, arguing in part that Rule 2 EPC and the Decision of the President dated 14 May 2021 concerning the electronic filing of documents permitted assignments with text string signatures to be used for recordal purposes. 

The Board of Appeal, deciding on the papers alone, issued their decision in J 5/23 on 4 September 2023 (which, incidentally, is incredibly quick for a BoA decision). The unsurprising aspect of the decision is that the Board did not agree with the appellant that the general rules for filing documents could apply also to recordal of assignments. There was, however, a substantial sting in the tail, which is that the Board have decided that electronic signatures of any kind (qualified or otherwise) do not meet the requirements of Rule 22(1) EPC. The reasoning from the Board was in essence that the definition of the word "signature" in Article 72 EPC has not been changed to allow electronic signatures. At the time the EPC entered into force, and also according to standard dictionary definitions, the word "signature" meant something written by hand. If this were to be interpreted to also include electronic signatures, the question arose as to what kind of electronic signature could qualify within the meaning of Article 72 EPC. Given that Article 72 EPC required there to be clear and unambiguous formal requirements for the transfer of a European patent application, it would be at odds with this rationale if - without any explicit legal basis - any type of text in electronic form could be considered a signature (see point 2.4.5). In the Board's view, the Notice from the EPO concerning electronic signatures could not overrule the definition of a signature in Article 72 EPC. What would be required is agreement between the contracting states to provide an updated interpretation, which would apparently go beyond what the Administrative Council was able to do. The Board's concluding statement was the following:

"In conclusion, the Board, applying the general rule of interpretation pursuant to Article 31 VCLT to the term "signature" in Article 72 EPC, i.e. interpreting this term in good faith according to its ordinary meaning in the applicable context and taking account of the purpose of this legal provision, holds that this term - in the absence of a different definition in the Implementing Regulations (see point 2.11 below) - must be understood as referring to a handwritten depiction of someone's name, written on the assignment "contract" referred to in Article 72 EPC. In the absence of any such handwritten signature, an assignment agreement does not comply with the formal requirements under Article 72 EPC and, under Rule 22(3) EPC, has no effect vis-à-vis the EPO. It follows from Rule 22(3) EPC that it is beyond the EPO's jurisdiction whether or not such a contract, in cases of non-compliance with the requirements of Article 72 EPC, also has no effect between the parties to the contract themselves. If necessary, this question must be decided by the competent national court according to the applicable law regulating the consequences of non-compliance with formal requirements for contracts" (point 2.9, emphasis added).

The Board does then, however, go on to indicate that this might be fixed by changing the Rules:

"While under the present legal framework the term "signature" must be understood as referring to handwritten signatures only, Article 72 EPC does, as such, not prohibit the legislator of the Implementing Regulations to the EPC, i.e. the Administrative Council, from specifying the meaning of the term "signature" in the Implementing Regulations (see G 3/19, Reasons XXVI.4). Taking due account of the rationale underlying Article 72 EPC (see points 2.4.2 and 2.4.3 above), such a definition could include a reference to some form of electronic signature and still respect the boundaries set by Articles 72 and 164(2) EPC. Providing such a definition in the Implementing Regulations would then change the context in which the term "signature" in Article 72 EPC is interpreted pursuant to Article 31 VCLT (see points 2.5 to 2.5.6 above), both by the departments of the EPO and by national courts." (point 2.11)

The upshot of all this is that, not only is it now clear that a "text string" signature in an assignment document is not acceptable but, based on this decision, all types of electronic signatures are now considered invalid for the purposes of recording an assignment. As of right now, all practitioners will need to revise their advice to clients that assignments must have handwritten signatures. It looks like there are only two options available if the EPO wants digital signatures to get accepted. The first option would be to somehow overturn this decision by getting the Enlarged Board of Appeal to decide on the matter, although there is of course no guarantee that the Enlarged Board would decide in any other way. This could in any case only happen once there have been two conflicting decisions, so it would first need another case to decide the other way for the President or a Board of Appeal to kick the issue further upwards. Perhaps there is another appeal currently pending? The alternative, which may be far less appealing but which could be a quicker option, would be to get the Administrative Council to amend the Implementing Regulations to change the context in which the term "signature" is interpreted, as suggested in point 2.11 of the decision. For the time being, however, it appears that using electronic signatures for assignments are effectively dead in the water. 

Postscript: Thanks to the anonymous commenter who has pointed out the final line in the decision (pdf version). Take a look:

Thursday 31 August 2023

Bitcoin File Format

Does copyright subsist in the 'Bitcoin File Format'? This was the question in Wright & Ors v BTC Core & Ors [2023] EWHC 222 (Ch), where Mellor J found earlier this year that it did not because the subject-matter was "not expressed or fixed anywhere" (paragraph 62). On appeal ([2023] EWCA Civ 868), Arnold LJ decided that all that was required was that "the structure be completely and unambiguously recorded" (para 69). The claimants did therefore have a "real prospect of successfully establishing the fixation requirement is satisfied" and the appeal was allowed. Do the claimants now therefore have a prospect, real or otherwise, of establishing that this fixation requirement is satisfied?

Firstly, for those who may be unfamiliar with the term (which is possibly understandable since it appears to have been invented for the legal proceedings), what is the "Bitcoin File Format"? According to the claimants, it is "the original work consisting of the structure of each block of the Bitcoin Blockchain" (referring to a Schedule which is unfortunately not publicly available, but which was written in 2022). The Bitcoin File Format (BFF) is therefore the way that data is arranged in each Bitcoin block. The basics of this are explained on the Bitcoin Wiki page for the Genesis Block, which in raw hexadecimal form looks like this:

Genesis Block (annotated)

My annotations indicate the various parts of the block, which have a particular meaning when read by the Bitcoin software. There is therefore a clear format to the block, which is the same for every subsequent block, but importantly the format is not clear from the block itself. There is in fact no information in the block itself about what each section means. Instead, the meaning has to be inferred from software that knows what to look for. This makes the fixation of the format different to that in, for example, an XML template where the template contains a structure (in <brackets>) that indicates what the content is about. This allows an XML reader to extract information from a file created using that template and order it accordingly. Previous cases have found that copyright can subsist in XML templates, i.e. an XML file with just the placeholders and no content.
An example XML template (from here)

This was the difficulty that Mellor J had when assessing whether the claimants had established that there was a serious issue to be tried. If the claimants could not establish how the format itself (not simply the data output, which was inevitably different every time) was fixed, the fixation issue was not met and there was no serious issue to be tried. The judge attempted to get the claimants to file evidence showing how the fixation requirement was met. The claimants filed various explanations from themselves and third parties that showed how the structure of each block was defined, but none of this was found to be relevant because they were not relevant works identifying the structure, only things that were provided after the event. As Mellor J stated:
"It is most revealing that, despite all these opportunities, the Claimants have not filed any evidence to the effect that a block contains content indicating the structure, as opposed to simply reflecting it. By 'content indicating the structure', I mean, by way of a crude example, a flag or symbol in the block which signals 'this is the start of the header' or 'this is the end of the header', or an equivalent of the sort of content which is found in an XML file format. Whilst I entirely accept that each block conforms to the structure described in Schedule 2 to the Particulars of Claim and is an instance or manifestation of that structure, the absence of such evidence confirms my initial view that, whether one considers the point at which the first, second or subsequent block(s) were written embodying the structure of the file format, nowhere was the structure of Bitcoin File Format fixed in a copyright sense in a material form in any of those blocks" (paragraph 57).

This is the key point on which the judgment was overturned on appeal. It is indeed clear that the format of the block is not evident from the block itself, unless you know what you are looking for, but Arnold LJ considered that this did not actually matter. The block did have a format, but the fixation of this format did not need to be in the same place. He summarised the requirements that the claimant would need to meet in order to establish that copyright subsisted in the BFF, which were set out (in paragraph 61) that: 

i) the Bitcoin File Format is a work; 
ii) it is a work that falls within one of the categories of protectable work specified in the 1988 Act; 
iii) the work has been fixed; 
iv) the work is original; and 
v) the work qualifies for copyright protection under the 1988 Act.

The only point in contention was iii), which Mellor J found was not met. Arnold LJ considered that, while it was correct that the work, that is to say the structure, must be fixed in order for copyright to subsist in it, it did not necessarily follow that content defining the structure was required in order to fix it. All that is required is that the structure be completely and unambiguously recorded. The claimants did therefore have a real prospect of successfully establishing that the fixation requirement was satisfied, provided they were able to provide evidence of the structure being recorded from the right time, i.e. from before the alleged infringements. 

An odd feature of this case is that, in the original Particulars of Claim (PoC), the claimants alleged infringement of: i) Database Right in the Bitcoin Blockchain (discussed by me here); ii) Copyright in the Bitcoin File Format; and iii) Copyright in the Bitcoin White Paper. There was no mention of the Bitcoin software itself, which as it turns out is actually where the Bitcoin File Format is fixed. The structure of the Genesis Block, for example, is in fact completely defined in the original Bitcoin software. It therefore strikes me as strange that the claimants chose not to refer to this as providing the fixation requirement, particularly as Mr Wright claims to have written the software himself and would therefore presumably know where to look. Given that Arnold LJ has decided that the work and the fixation requirements can be met by different things, perhaps this will be what the claimants come up with next in their attempts to enforce copyright in the Bitcoin File Format. 


Friday 25 August 2023

Heraeus Noblelight v First Light Lamps

Since the case of Catnic Components v Hill & Smith came before the House of Lords in 1978, the principle of "purposive construction" has been established in UK law regarding interpretation of patent claims. In the Catnic case, the issue was about whether a patent claim to a lintel having a support member "extending vertically" covered an otherwise identical lintel having a support member that was not quite vertical. According to Lord Diplock's leading judgment, "A patent specification should be given a purposive construction rather than a purely literal one derived from applying to it the kind of meticulous verbal analysis in which lawyers are too often tempted by their training to indulge". This meant that the term "extending vertically" was to be purposively construed to effectively mean that the member should be sufficiently vertical for it to serve its purpose. A few degrees either way would still allow it to serve its purpose, so the term in claim 1 of the patent was not to be construed narrowly and the defendant's lintel was found to infringe. 

Even though the law has since developed into what is now, following Actavis v Eli Lilly, effectively a doctrine of equivalents for patent claims, the principle of purposive construction has not gone away and is still in use when it comes to interpreting specific terms in a patent claim in a way that means they should perhaps not be construed as narrowly as they first appear. 

A nice example, again with a simple mechanical invention, has recently appeared in the form of the judgment of Mr Justice Zacaroli in Heraeus Noblelight Limited v First Light Lamps Limited [2023] EWHC 1950 (Pat), issued on 31 July 2023. The case related to Heraeus' European patent EP1598845B1, which claimed a method for forming a quartz glass lamp, the invention relating to how a seal between a metal electrode and a quartz glass tube was formed during manufacture of the lamp. The problem the invention aimed to address was the previously complicated method of manufacture that involved many different stages and sometimes still resulted in failure of the seal between the electrode and the quartz glass. 

It was already known that an intermediate glass material having a thermal expansion coefficient between that of the electrode and the quartz could be used to reduce the differential stress set up on cooling the seal, but the manufacturing process was still complicated. The invention simplified this by, instead of making two seals with the intermediate glass that were subsequently joined together, forming a direct seal using a bead formed on the electrode that joined directly to the quartz tube, following which an internal pressure in the tube caused a smoothing out of any edges internally. This is best illustrated with two simple drawings from the patent, reproduced below. In the first drawing (Figure 2 of the patent), the electrode 2 has a bead 4 of intermediate glass material around its electrical feedthrough 3. This is inserted into a quartz tube 1 while heat is applied and the electrode is rotated relative to the quartz tube. After the glass bead is sealed against the quartz tube, as shown in the second drawing (Figure 1 of the patent), an internal pressure is applied to the quartz tube to smooth out the internal join with the glass bead, forming a smooth internal radius that reduces the possibility of cracking on cooling. 

Electrode (2,3) with bead (4) prior to sealing with quartz tube (1)

Electrode after being sealed against quartz tube.

The patent claimed the method in the following way (with emphasis added on the key feature in question):

1. A method of forming a quartz glass laser lamp or quartz glass flash lamp containing electrodes (2) at opposite ends within a tube (1) of quartz glass, an end of said tube (1) having an internal diameter, an external diameter and an annulus, wherein said method comprises formation of a glass to metal seal at said one end of the quartz glass tube comprising the following steps:
    (1) the electrode (2) or its electrical feed through (3) is surrounded with a sealing glass (4) comprising a sheath and a bead, the bead being bigger than the internal diameter of the end of the tube (1) but not bigger than the external diameter of the end of the tube (1),
    (2) heating the bead to a soft state while rotating it,
    (3) inserting the bead into the annulus so as to form a seal,
    (4) after the insertion, heating the seal so that the sealing glass (4) wets on and fuses with said one end of the tube (1), both internally and to the end of the tube (1),
    (5) after said fusing of the sealing glass (4) with said quartz tube (1), applying an internal positive pressure while the sealing glass (4) is molten causing the sealing glass (4) inside the tube (1) to move back towards the end of the tube (1) so as to form an internal radius of sealing glass (4) which is directly sealed between the electrode or its electric feed through (3) and the tube (1) of quartz glass.

It is clear that it would be necessary for the bead to be bigger than the internal diameter of the end of the quartz tube, otherwise a seal would not be made. However, did the claim really require that the bead was literally "not bigger than the external diameter of the end of the tube"? The question was important because the alleged infringing method did involve making the bead bigger, only by around 0.1-0.3 mm, but otherwise involved forming a seal in the same way as claimed in the patent.  

Heraeus argued that the term "not bigger" should be interpreted purposively as "not bigger by reference to tolerances that formed part of the common general knowledge [CGK]", claiming that 0.3 mm was within such tolerances. Alternatively, the term should be interpreted to be "not bigger such that it impairs the strength or utility of the seal", encompassing oversized beads. They also argued for literal infringement on the basis that some of the beads used by the defendant would inevitably be not bigger than the quartz tube due to variations, or alternatively that according to the doctrine of equivalents a lamp manufactured with oversized beads would be an equivalent. 

Having heard the arguments from both sides, including expert evidence, the judge found that the skilled person's CGK would include beads of varying sizes, including oversized beads. The question was then whether, as a matter of construction, the words "not bigger than" the outer diameter of the tube was to be read as imposing a stricter tolerance than that which the skilled person would understand to be CGK. The claimant argued that it did not, while the defendant argued it did. The judge considered that, since the requirement for the outer diameter of the finished lamp did not generally require such a tight tolerance, the protection sought in the patent was not limited to a method in which beads were precisely no bigger than the outer diameter of the tube but included variants in which the bead was not materially bigger than the outside diameter of the tube to an extent "which could have no material effect upon the way in which the invention worked" (per Lord Diplock in Catnic). Bigger in this case therefore meant not bigger such that it impaired the strength or utility of the seal, which encompassed any bead made within CGK tolerances. 

For completeness, the question of infringement by equivalents resulted in the same conclusion. Although it was not necessary to consider the question of literal infringement, this was determined not to be found because the evidence did not show smaller beads actually having been used. 

The patent was found to be valid over the prior art cited by the defendant (the arguments for which I will skip over here as they don't seem to me to raise anything of interest), so the patent was found to be infringed by the defendant's process on both a purposive construction of the claimed invention and according to the doctrine of equivalents. 

You might think that the lesson to be learned from this would be that an overly specific patent claim can still be infringed even if some features are not literally present in the alleged infringement, and you would be correct. However, the trouble and expense caused by including such a specific feature in a patent claim can nevertheless be enormous if such a claim is litigated. Patent attorneys, being generally conservative and not wishing to cause unnecessary trouble, will most likely take a different lesson, which is that specific terms in a claim that are not strictly necessary for the invention to work or to provide a distinction over the prior art should be avoided. Following Catnic, drafting practice did not change so that specific terms such as "vertical" were used by patent attorneys, happy in the knowledge that they could be interpreted to mean "vertical enough to do the job required". Instead, the word "substantially" was used ubiquitously to provide more wriggle room, often without realising the reason behind doing it. In a similar way with this case, I would guess that any patent attorney reading it would have a more careful think about the claim in front of them and perhaps try not to use any limiting terms that really do not need to be there. I certainly will.