Comparative & International Software Patent Issues

6/27/20181
Comparative & International Software Patent Issues
Jay Erstling
August 18, 2011
Software patents in Europe
Software patents in the United Kingdom
Software patents in Germany
Software patents in Canada
Software patents in Japan
Software patents in China

SM
© 2011 Patterson Thuente Christensen Pedersen, P.A., some rights reserved - www.ptslaw.com
DISCLAIMER: This presentation and any information contained herein is intended for informational purposes only and should not be construed as legal
advice. Seek competent legal counsel for advice on any legal matter.
Comparative & International
Software Patent Issues
Jay Erstling
William Mitchell College of Law – St. Paul, MN
Patterson Thuente IP – Minneapolis, MN

Agenda
Convergence of Laws
Increasingly, there is a greater general acceptance of
software patents and computer implemented inventions. The
issue isn’t whether software patents are patentable subject
matter, it is how you go about making them patentable.
Software Patents – A Global Snapshot
Special thanks to Charmaine Harris (Patterson Thuente IP;
William Mitchell, Class of 2011).
June 27, 20183

Software Patents in Europe
Business method and software patents not patentable subject matter
Must solve a technical problem using technical means
June 27, 20184

EPC Article 52(2) and (3):
Methods for doing business and computer programs are not
patentable where the patent application relates to this subject
matter as such.
Article 52(2) excludes from patentability:
Discoveries; Scientific theories and mathematical methods;
Aesthetic creations; Schemes, rules and methods for performing
mental acts, playing games or doing businesses; Programs for
computers and presentations of information
June 27, 20185

Example:
A business method claim consisting of a series of steps to achieve an
economic goal, with each step carried out by a general purpose
computer
Remove the method of doing business, leaving only a general
purpose computer performing a series of steps as the claim’s
technical features
EPO would argue computer is just implementing well-known
functions, not solving a technical problem
A person of ordinary skill would be able to program such a general
purpose computer to perform the steps of the business method
without any inventive skill.
June 27, 20186

Boards of Appeal: Evolving views
Computer implemented inventions can qualify for patent protection
but may lack inventive step
• Inventive Step: “Solving a technical problem using a
technical means”
Contribution approach: if inventive step resides only in the
contribution of excluded matter – not patentable
Technical effect approach: if the invention as defined in the claim
does not make a technical contribution to the known art – not
patentable
BUT
Any hardware approach: If the claim involves the use of physical
hardware or is a piece of it – patentable
June 27, 20187

Boards of Appeal: Examples
Software methods for calculating pension benefits – Not Patentable
Computerized auction method – Not Patentable
Enhancing a graphical display – Patentable
Exchanging data between application programs on a computer –
Patentable
8/16/118

Result: Confusion among Member States:
Tension between EPC Article 52 approach to patent eligibility and
Boards of Appeal’s more fluid analysis based on inventive step
Some national courts followed the new approach based on
inventive step; others continued to use the old approach
This left national jurisdictions with the last word for judging the
patentability of a European patent
June 27, 20189

Software Patents in the United Kingdom
UK Patent Law
Aerotel v. Telco
June 27, 201810

UK Patent Law
Intended to implement similarly worded provisions of the EPC
Section 1(2)(c) of the UK Patent Act 1977
Anything which consists of a program for a computer is not an
invention for the purposes of the Act only to the extent that a
patent application for a patent relates to that things as such.
June 27, 201811

Aerotel v. Telco, October 2006
A new 4-step test implemented partly in response to the seemingly
contradictory decisions of the EPO Boards of Appeal
1. Properly construe the claim
2. Identify the actual contribution
3. Does the contribution fall solely within excluded subject
matter
4. Check whether the actual or alleged contribution is actually
technical in nature
June 27, 201812

Aerotel v. Telco, October 2006
“People are applying for business method and computer program
patents in significant numbers. The pressure stems in part form
the fact that people have been getting patents for these subject
matters in the USA. Since they can get them there, they must as a
commercial necessity apply for them everywhere. If your
competitors are getting or trying to get the weapons of business
method or computer program patents you must too. An arms race
in which the weapons are patents have set in….”
8/16/1113

Enlarged Board of Appeal (EBA)
June 27, 201814

EBA Opinion G03/08, May 2010:
Decisions rendered by the Boards of Appeal can be different due to
the normal evolution of case law without being divergent. “Case law
in new legal territory does not always develop in linear fashion, and
earlier approaches may be abandoned or modified.” (point 7.3.1)
“The technical boards often have to subject their established case
law to critical review” (point 7.3.3) “Even a radical shift in
jurisprudence need not necessarily be construed as a different
decision […] vis-á-vis earlier case law […] provided that the Board
[…] declares its earlier practice to be no longer relevant” (point
7.3.5)
The evolution between decisions that appears different in fact
constitutes “a legitimate development of the case law […]” (point
10.12)
June 27, 201815

EBA summarized existing case law:
“While the Enlarged Board is aware that this rejection for lack of
inventive step rather than exclusion under Article 52(2) EPC [lack
of eligibility] is in some way distasteful to many people, it is the
approach which has been consistently developed […] and we
consider it not to be the function of the Enlarged Board in this
Opinion to overturn it.” (point 10.13)
Patent applications claiming computer implemented methods,
computer programs and storage media storing a computer
program are patentable provided that the claimed subject matter is
inventive, where only features contributing to the technical
character of the claimed subject-matter are taken into account for
the assessment of inventive step.
June 27, 201816

Summary:
Method claims that interact with a tangible hardware device in an
intimate fashion, alter the nature of an operating system, or affect
the way a computer operates are more likely to be granted in the
EPO than claims directed to pure software applications that execute
on a general purpose computer and that do not affect physical
devices or systems.
June 27, 201817

Case law after Aerotel
June 27, 201818

AT&T Knowledge Ventures Application and CVON Innovations Ltd’s
Application, 2009
UK High Court set out 5 signposts to indicate the patent eligibility of a
computer program, in lieu of the Aerotel test:
Whether the claimed technical effect
1. Has a technical effect on a process which is carried on outside the
computer;
2. Operates at the level of the architecture of the computer;
3. Results in the computer being made to operate in a new way;
4. Increases the speed or reliability of the computer;
5. Overcomes the perceived problem as opposed to merely being
circumvented.
June 27, 201819

The AT&T/CVON Signposts
Subsequently used by the English High Court in Gemstar v. Virgin
Currently being applied by UKIPO hearing officers
No UKIPO practice notes on patentability of computer implemented
inventions in light of G03/08
June 27, 201820

Software Patents in Germany
Business method and software patents not patentable for specific subject
matter
Must solve a technical problem using technical means
June 27, 201821

Section 1 of the German Patent Act
“Patents are granted for inventions in all fields of technology if they
are new, involve an inventive step and are susceptible to
commercial application.”
Schemes, rules and methods for performing mental acts, playing
games or doing business and programs for computers are
excluded from patentability only to the extent to which the
protection of such subject matter or activities as such is requested.
• Computer program may be patentable if it has “technical
character”
June 27, 201822

Past Federal Supreme Court has found that a computer program is
technical if it:
Operates, controls or supervises the activity of a technical device –
“ABS brake”, 1980
Relates directly to the operability of a computer and enables the
interaction of its elements – “Page Buffer”, 1992
“Controlling device for examination modalities” – 2009:
• “the program has to include instructions aimed at solving a
specific technical problem with technical means.”
June 27, 201823

“Dynamische Dokumentengenerierung (Dynamic Generation of
Documents),” invalidity proceedings, 2010
German Federal Supreme Court
Issue: what is needed to fulfill the requirement of technical character
In order to fulfill the requirement, Court held that:
Subject matter of the claim may be defined by both technical and
non-technical features
Not relevant which features dominate the claimed teaching
Patentability depends only on whether combination is new and
inventive
June 27, 201824

“Dynamic Generation of Documents,” 2010
The Court has thus set the requirement that an invention have
technical character quite low
• Data processing systems always have technical character
• Products/devices/apparatuses have technical character
• Methods have technical character if they employ technical
means, even conventional ones
But to be patentable, claimed invention must solve a concrete
technical problem with technical means that are novel and inventive
• Technical means can be a general purpose computer (i.e.,
programmed computer that does not require the modification
of system components)
June 27, 201825

Software Patents in Canada
Patentable subject matter
Amazon.com v. Canada
Software and business method
patentability still uncertain
June 27, 201826

Canadian Patent Law
Similar to United States law
• “Any new and useful art, process, machine, manufacture or
composition of matter,” or any improvement thereof.
June 27, 201827

Schlumberger v. Commissioner of Patents, 1981
“If those calculations were not to be effected by computers but by men,
the subject-matter of the application would clearly be mathematical
formulae and a series of purely [unpatentable] mental operations.”
Merely performing mental operations on a computer would not transform
these operations into patentable subject matter.
Nearly 30 years later the Canadian Federal Court takes a fresh look
June 27, 201828

Amazon.com v. Canada, 2010 (one-click patent application)
Federal Court of Canada
Canadian Commissioner of Patents rejected the application as being
directed to unpatentable subject matter
Federal Court reversed and sent the application back to the CIPO for
expedited re-examination
• “A ‘business method’ can be patented in appropriate
circumstances”
• The Commissioner engaged in inappropriate policy-making by
determining that an invention must be technological in nature
Case on appeal to the Federal Court of Appeal
June 27, 201829

Amazon.com v. Canada, 2010 – Interpreting the Patent Act
“The Patent Act is not static; it must be applied in ways that recognize
changes in technology such as the move from the industrial age to the
electronic one of today.”
“In an area of the law where advancing human ingenuity often creates
novel legal questions to which there may be no immediate answer in
Canadian jurisprudence, it can be useful to look to other regimes.
However, this must be done mindfully…. While international
jurisprudence can provide guidance, these cases and the particular
Canadian context of the question before the Court… must correspond
to Canadian law. Some jurisdictions will be more applicable than
others.”
• US law more persuasive than that of EP, UK, or AU
8/16/1130

A broader test should be used for determining patentable art:
It must not be a disembodied idea but have a method of practical
application;
It must have a new and inventive method of applying skill and
knowledge; and
It must have a commercially useful result.
Purposive construction should be used
Intention of the author is determinative
8/16/1131

Amazon.com v. Canada, 2010
The system claims were “machine” claims as per the definition of
“invention” in §2 and were therefore patentable
The court applied the three-part test for the method claims and held
those claims were also patentable
Amazon.com’s claimed invention was a novel approach to online
ordering that added to the state of knowledge, consisted of a
practical application and was not simply a disembodied idea, and
was “undisputed” in achieving a commercially useful result.
June 27, 201832

Amazon.com v. Canada, 2010
There was no basis in Canadian law for a per se prohibition against
business methods
• Noted that the majority in Bilski v. Kappos rejected calls for
categorical exclusions of business methods from patentability
No basis for a “technological” requirement or test in Canadian law
• It would render the system “overly restrictive and confusing”
• Need for flexibility in the changing state of technology
Court stated for the first time in Canada that in appropriate
circumstances inventions that might be characterized, at least
loosely, as “business methods” are patentable in Canada.
June 27, 201833

Software Patents in Japan
Middle of the road approach
Patentable invention – a highly advanced creation of technical ideas utilizing
natural laws
Hardware and software must work in
a cooperative manner
June 27, 201834

Software Patents in Japan
Japanese Patent Law defines a patentable invention as
“a highly advanced creation of technical ideas utilizing natural
laws”
Software inventions and software implemented business methods
are eligible for patent protection if a specific interaction with a
hardware resource is defined in the claims.
Must be described in a claim such that software and hardware
resources are working in a cooperative manner
A technical aspect is necessary for a computer-implemented
business method to be eligible for patenting. This can be
achieved by drafting a patent claim to specify a computer or by
combining a process with a technical apparatus.
June 27, 201835

Software Patents in China
Patentable even if the software forms the major part of the invention
3-pronged test
Solve a technical problem by a technical effect
• Algorithms and business methods
generally do not pass
Claim to a method
performed by the
software or a device
running on the software
June 27, 201836

Chinese Patent Law defines an invention as
“Any new technical solution relating to a product, process or improvement
thereof.”
3-pronged test for ‘technical solution’
1. To solve a technical problem;
2. by a technical means;
3. to produce a technical effect.
June 27, 201837

Technical Solution
Algorithms and pure business methods generally do not satisfy the test,
referred to as “rules and methods of mental activities”
• If the claim includes technical features along with rules and methods
of mental activities it may be patentable
For software-related inventions, the first-step (technical problem) and the
third-step (technical effect) are the hardest to satisfy
June 27, 201838

Obtain patent protection in the form of a claim to a method performed by the
software or a device (system) running on the software:
Viewed as a functional module architecture that realizes the technical
solution provided by the software invention
Not a claim to protect the physical device itself
A flowchart used to illustrate the functions of the software
Each component in the device claim is considered as the functional
module for carrying out each step of the flowchart or each step of the
method
June 27, 201839

Thank You
Jay Erstling | jay.erstling@wmitchell.edu
June 27, 201840

Comparative & International Software Patent Issues

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