It may not be a binding legal text, but the ‘Guidelines for Examination in the EPO’ manual sits on the desk of every EPO examiner and provides a strong indication of what will and will not be accepted. Unders discussion in this edition’s cover story, familiarity with its contents is strongly recommended. We also report on the recently introduced facility to file 3rd party observations with respect to PCT applications, which may be a powerful tool for bringing prior art and comments to the attention of examiners in a centralised fashion.
Also of interest, following discussions with a group of UK examiners about the latest case law, we review the landscape with regard to patenting computer programs in the UK.
Article 1: Keeping to the Straight and Narrow - Navigating the EPO’s Updated Guidelines for Examination
The European Patent Office (EPO) has issued a new version of its guidelines for examination, which provide guidance for examiners and applicants on European patent law and procedure. Some notable changes are discussed in this article. Guideline references of the form A-IV, 2 refer to Chapter A, part IV, section 2.
Colour photographs may now be filed as drawings for a European patent application (A-IX, 1.2). However, the photographs will be scanned and reproduced in black and white, so any colour detail will be lost. Therefore, we would not advise relying on the colour detail of the photographs for disclosing features of an invention.
Priority search results
If a European application claims priority, then the search results for the priority application must be provided to the EPO (A-III, 6.12). If the examining division finds that the priority search results have not been provided, then it will ask the applicant to file them within 2 months (C-II, 5). If this is not done in time, then the application is considered to be withdrawn.
However, the priority search results do not have to be provided if:
- the search for the priority application was performed by the EPO;
- the priority application is a US, UK or Japanese application; or
- the European application is a divisional application and the priority search results have already been provided for the parent application.
Under European practice, an invention must have a technical effect in order to be considered patentable and involve an inventive step. The new guidelines state that features concerning the graphic design of user interfaces do not have a technical effect, and so cannot provide an inventive step (G-II, 3.7.1).
Also, a data structure is not considered to have a technical effect because it is merely a static memory configuration which does not carry out anything by itself (G-II, 3.7.2). However, the processing of the data structure may achieve a technical effect. Therefore, when an invention involves a new data structure, we would recommend drafting the claims in terms of a method or apparatus which processes the data structure, as this is more likely to succeed than a claim to an isolated data structure.
Generally, methods of treatment of a human or animal body by surgery or therapy are excluded from patentability, since doctors or vets should be able to treat patients without fear of patent infringement. However, the new guidelines provide an exception to this principle. According to the EPO, claims which relate exclusively to a clinical trial of an experimental medicament carried out on human beings should not be excluded from patentability, because they are performed under controlled conditions with the consent of the patient (G-II, 4.2.2).
Prior art status of documents
The new guidelines state that, where there is conflict between an abstract and its source document, the incorrect parts of the abstract are not considered as prior art (B-VI, 6.3). For example, often European examiners rely on an English abstract of a Japanese patent application to support a novelty or inventive step objection, without checking the Japanese description. If the applicant can show that the abstract is incorrect, for example by using a machine translation of the description, then the disclosure of the abstract may be disregarded.
Generally, documents which have only been made available under a non-disclosure agreement (NDA) are not considered to be available to the public and so cannot be considered as prior art or as evidence of a skilled person’s general knowledge.
However, sometimes a document is openly available for sale to interested parties, but under an NDA to protect the income deriving from such sales. For example the CD-ROM, DVD and Blu-Ray disc standards are available for sale in this way. The EPO now says that these standards documents should not be considered as prior art because of the NDA (G-IV, 7.6). If the new guideline is followed, then patent applications which rely on assumed knowledge of these standards for disclosing the invention could be objected to for not sufficiently disclosing the invention. On the other hand, opponents may not be able to use these documents to attack the validity of a patent.
However, applicants and opponents may be able to argue that the new guideline is incorrect because it is contrary to the technical board of appeal’s decision in T50/02 which held that in this situation a document should be considered as available for the public, because it is essentially available to all interested parties who are free to buy the document from its original source.
When the word ‘for’ is used in a claim, it is usually interpreted to mean ‘suitable for’. For example, a ‘device for cooking’ would cover any device which is suitable for cooking, even if the device is not explicitly described as being for the purpose of cooking.
However, the EPO has now said that in applications in the computing/data processing field, ‘means for’ features should be interpreted as means adapted to carry out the relevant functions, rather than merely means suitable for carrying them out (F-IV, 4.13). Therefore, these features can provide novelty over an unprogrammed or differently programmed computer which is not explicitly described as performing these functions.
When the examining division agrees to grant a patent application, a Rule 71(3) communication is issued together with the patent text to be granted. Sometimes the examiner will propose some amendments to the text at this stage. The guidelines contain new examples on what amendments the examining division should, and should not, propose at the Rule 71(3) stage without the applicant’s approval (C-V, 1.1). The examples make it clear that the examiner should only propose amendments which the applicant would be reasonably likely to be accept.
If the applicant files amendments in response to the Rule 71(3), or challenges any amendments made by the examiner, it is no longer necessary to file claim translations or pay fees at this stage (C-V, 4.1). Optionally, the fees may be paid anyway and held on credit ready for when a text is agreed for grant (A-X, 11). If the amended text or arguments against the examiner’s amendments are allowable, a second Rule 71(3) communication will be issued and any credited fees may be used to pay the fees required (C-V, 4.7.2).
The guidelines state that the examining division is not allowed to issue a summons to oral proceedings until at least one substantive examination report has been issued (E-II, 5.1). The search opinion is not enough.
Laptops or other electronic devices, and computer-generated slideshows, may now be used in oral proceedings at the discretion of the division (E-II, 8.2.1, 8.5.1).
Oral proceedings before the examining division may be held by video conference (E-II, 11). However, this is not possible before the opposition division.
Lack of unity for a Euro-PCT application
If the EPO believes that an application claims two or more inventions which do not share an inventive concept, the EPO will raise a ‘lack of unity‘ objection and demand that the claims are limited to one invention. For a European application which stems from an international (PCT) application, the EPO usually performs a supplementary search. The guidelines now state that, where the EPO finds lack of unity during the supplementary search, the applicant must limit the application to the invention searched in the supplementary search (H-II, 7.4.2).
This remains a contentious issue, not least because Rule 164(2) EPC could be interpreted as allowing the applicant to select an invention searched in the international search report in this situation. Furthermore the EPO’s approach causes a disparity between Euro-PCT procedure and Euro-direct procedure (since in the latter the applicant has the opportunity to pay an additional search fee if the EPO finds a lack of unity) and Rule 164(2) was introduced as part of the changes in EPC2000 to harmonize the two application routes. It seems that it will require a Board of Appeal to resolve this conflict, but in the meantime it is to be expected that the EPO will continue to insist that when non-unity is raised, only inventions covered by the EPO’s supplementary search may be pursued in a Euro-PCT application.
A divisional application may be filed only if a) the parent application is still pending, and b) the period for filing a divisional application has not expired.
For point a), the guidelines have been updated to clarify that when a European application is refused, it remains pending until the end of the time limit for filing the notice of appeal (A-IV, 18.104.22.168). Therefore, after a parent application has been refused, a divisional application could still be filed until 2 months after the notification of the decision to refuse the application.
Regarding point b), the period for filing a divisional application based on an earlier European application usually expires 2 years after notification of the first substantive communication from the examining division. The guidelines now clarify that, if the first substantive communication from the examining division is based on the wrong documents, then this does not trigger the 2 year period (A-IV, 22.214.171.124). Therefore, the examining division’s mistake will not disadvantage the applicant.
Also, where a new lack of unity objection is raised later on in prosecution, this can restart the 2 year period for filing a divisional application. The EPO has clarified that when the new objection is raised in oral proceedings, then the 2-year period starts when the minutes of the oral proceedings are notified to the applicant, not on the date of the oral proceedings (E -II, 8.7).
Article 2: Computer-Implemented Innovation - The Test for Patentable Subject Matter in Europe and the UK
Susan Keston & Alan Boyd
The influence of the Internet in directing the knowledge and opinion of software engineers with regard to the patenting of computer programs is significant. Much of the material on the Internet on this topic relates particularly to the US patent system, which differs from that in Europe with regard to the assessment of subject-matter excluded from patentability. For example, a computer program associated with an innovative business method is much more likely to be viewed as patentable subject-matter in the US than in Europe. The emergence of open source software (OSS) as a successful business model has politicised the debate on the patentability of computer programs, with an influential body of computer programmers arguing that patenting of computer programs could inhibit innovation and that in any case, copyright alone offers sufficient protection for computer programs.
A different point of view is that the patenting of computer programs provides a springboard for innovation, encourages investment in research and development and is essential to provide a business with adequate recourse in law against the theft of hard-won innovation.
The contention that copyright alone generally offers sufficient legal protection for an innovative computer program, and provides an adequate remedy for a competitor copying the idea without permission, is a weak one. Copyright law is jurisdiction dependent and in the UK, for example, copyright protection is limited the expression of an idea. Thus copyright alone is unlikely to offer sufficient breadth of legal protection for an innovative computer program that provides a technical solution to a problem. However, copyright may protect a particular ‘expression’ of computer program code in which the invention is implemented.
By way of contrast, a set of patent claims delineates a justifiable monopoly for a computer-implemented innovation relative to the known state of the art at the priority date. This has the advantage of allowing the patent applicant to capitalise on that innovation, for example, via licensing and, upon grant of the patent, to prevent competitors from exploiting the invention without the consent of the patent proprietor.
In Europe the criteria for assessment of the patentability of computer programs have been the focus of heated debate since the landmark 1998 European Patent Office (EPO) decision T 1172/97 IBM, which extended patentability to computer program products. However, there can be divergence between the assessment of computer programs for patentability in Europe and the UK. In the intervening years since the IBM decision, the UK Intellectual Property Office (UK IPO) assessment of computer programs for patentability has vacillated with respect to the EPO’s position, depending upon the prevailing caselaw from the UK Courts. Decisions of the UK courts are binding on the UK IPO whereas decisions of the EPO are only persuasive.
This situation can leave applicants for computer program patents in a state of confusion regarding what innovations are currently excluded under UK law and practice and whether an application has more likelihood of being treated as non-excluded by the UK IPO or by the EPO. The EPO is currently viewed as being an easier route than the UK via which to prosecute ‘borderline’ computer program applications. Accordingly, a software engineer considering seeking patent protection for an invention may have to overcome the dual barriers of: a) an inherent prejudice in parts of the programming community against obtaining patent protection for computer-implemented innovation; and b) the confusion regarding whether or not a computer-implemented invention will be regarded as excluded subject matter in the UK, Europe and the US.
So what is the situation in the UK? In fact, patent protection continues to be available for computer programs in the UK, provided that they fall outside the excluded subject matter provisions of the UK Patents Act (UKPA). The claimed invention must also satisfy the usual criteria of being novel, non-obvious and capable of industrial application.
It can often be difficult to determine whether an invention falls within the excluded subject matter provisions of the UK Patents Act. The authors of this article recently had the opportunity to speak to UK IPO computing group examiners about computer programs and excluded subject matter, and gained a valuable inside view as to how computer-related inventions are currently being assessed at the UK IPO.
Current test for patentable subject matter
The current interpretation of S1(2) of the UKPA is that if the subject matter of a patent application is more than just excluded subject matter, then the application may be allowed. The patentability exclusions relate to a number of different fields including computer programs ‘as such’.
At present, the UK IPO test for excluded subject matter uses a three step test outlined in Aerotel  RPC 1 in view of Symbian  EWCA 1066:
- Construe the claim.
- Identify the ‘actual contribution’, meaning what has been added by the inventor(s) to the stock of human knowledge.
- Is that contribution entirely in the excluded subject matter, and is it actually technical?
The concept of a ‘technical contribution’ can be traced back to the EPO case VICOM T0208/84, where the UK IPO adopted a common position with the EPO. An explicit definition of ‘technical’ remains elusive, with both the UK IPO and the EPO preferring to use an examples-based definition, which provides flexibility for dynamic changes in meaning as both the law and technology evolve.
If the third step of the Aerotel test identifies that the actual contribution is a computer program, the UK IPO then consider whether the computer program is technical in nature. This involves the use of the ‘signposts’ described in AT&T and CVON  EWHC Civ 1371 which include:
- Does the invention control something external to the computer?
- Does the invention affect the architecture of the computer, rather than the data (eg, the memory, cache, or processor)?
- Does the invention result in a new way of operating the computer?
- Does the invention result in the computer being operated in a faster or more reliable manner?
The UKIPO’s practice was independently corroborated by Mann J in Gemstar v Virgin. The signposts provide guidance rather than being a necessary requirement or binding statement of law.
Beware incorrect application of test
The Aerotel test, particularly step 3, can be difficult to apply in practice. If the examiner assesses the contribution made by component parts of the claim rather than the contribution made by the claim as a whole, this can result in the examiner erroneously concluding that the invention is directed to excluded subject matter.
In the case ‘Protecting Kids The World Over (PKTWO)’,  EWHC 2720 (Pat), the judge stated that it is not correct to exclude from the assessment of the contribution features of the claim that form part of the prior art. Recent experience has taught us that examiners sometimes incorrectly separate claim elements into what is known and what is new and then decide upon the contribution made.
This is best understood in the context of an example. In Vicom, the invention related to digital image filtering and a claim to ‘A method of digitally filtering data’ was considered excluded as a mathematical method. However, a claim to ‘a method of digitally processing images’ was considered non-excluded by the EPO Board of Appeal because the ‘physical entity’ ie, the image, was specified as a claim element. Here the novelty of the invention related to the particular implementation of the digital filtering, but the invention was considered non-excluded because of the actual technical activity being performed on a physical entity (the image). Clearly, image processing per se was a known element of the claim yet it formed part of the contribution of the claim as a whole.
Halliburton  EWHC 2508 (Pat) related to simulating the performance of drill bits. The application was rejected by the UK IPO, on the grounds of being merely a program for a computer, a mathematical method and the performance of a mental act.The High Court rejected the UK IPO decisions that the invention was excluded on the basis of a program for a computer or a mathematical method. The former exclusion was ruled to not apply, because the subject matter clearly extended to more than a computer program as such. The second exclusion was ruled not to apply because, while mathematics were used, they were used to represent a drill bit. Consequently, it was not simply an abstract mathematical method that was being used in the invention.
Importantly and with regards to the mental act exclusion, the High Court ruled that the exclusion was to be interpreted narrowly. The inclusion of any hardware would move the invention out of the excluded subject matter category. Consequently, a mental act cannot be carried out on a computer, and so a computer that implements a simulator can also not be said to be carrying out a mental act. Prior to Halliburton, the UK IPO refused an application directed to simulation of programmable devices such as microprocessors in the decision BL O/066/06 ARM Limited. The UK IPO examiners conceded that in view of Halliburton, such cases relating to simulators are now less likely to be categorised as excluded subject matter.
Patenting of computer programs will continue to provide a valuable mechanism for protecting IP rights in computer-implemented innovations. Drafting and prosecuting patent applications in this area should focus on setting out the technical contribution made to the state of the art, which is crucial in obtaining a granted UK or European patent. The Aerotel test will, at least for the time being, be applied by UK examiners with reference to the AT&T signposts where appropriate.
Article 3: PCT Applications - Filing Third Party Observations
The international patent application system administered by the World Intellectual Property Organization (WIPO) allows an applicant to file an international application (also referred to as a PCT application) which is maintained as a single application during the so-called ‘international phase’. At the end of the international phase, the applicant can then turn the PCT application into multiple separate applications in countries of interest. During the international phase, a search for relevant prior art in relation to the PCT application is performed by an international searching authority (ISA), and optionally the applicant may request that a preliminary examination be performed by an international preliminary examining authority (IPEA) on the basis of the prior art identified by the ISA.
Traditionally, third parties have had no mechanism for commenting on a PCT application whilst it is in the international phase. However, via a form on WIPO’s electronic interface ‘ePCT’, it is now possible for third parties to submit an observation on a PCT application during the international phase if they believe that the claimed invention either lacks novelty or inventive step. Some key points of the third party observation mechanism are:
- Observations on a PCT application can be submitted from the PCT publication date until 28 months from the priority date of the PCT application;
- a party may only make a single observation on any particular PCT application;
- a maximum of 10 observations may be submitted on any particular PCT application;
- an observation consists of a list of at least one, and up to a maximum of ten, documents published prior to the international filing date (or patent documents having a priority date before the international filing date), together with a brief indication of how each one is considered to be relevant to the novelty or inventive step of the claimed invention;
- although a user account with WIPO is required in order to file an observation, it is possible to select an option on the form that causes your identity to be kept confidential.
The applicant is permitted to respond to observations by third parties until 30 months from the priority date, but is not required to do so. The observations (excluding copies of the cited documents) and any responses by the applicant will be made publicly available on WIPO’s PATENTSCOPE website. They will also be made available to the ISA if the international search report has not yet been produced, and to the IPEA if the international preliminary report on patentability has not yet been prepared. Furthermore, they will be notified to any patent offices in which applications are derived from the PCT application at the end of the international phase.
It is however up to the individual offices to decide what use to make of an observation filed by a third party. This is a potential disadvantage common to third party observation schemes run by other patent offices, since the third party cannot influence the subsequent discussions that take place between the applicant and the relevant patent office/international authority, and hence will be reliant on the patent office/international authority making effective use of the material provided in the observation.
However, on a positive note, the above PCT third party observation mechanism provides a simple, centralised mechanism for bringing relevant prior art to the attention of the applicant, the international authorities involved in the handling of the PCT application during the international phase, and the patent offices that subsequently handle applications derived from the PCT application. Further, due to the early stage in prosecution that such prior art can be made available via this mechanism, it will be available for consideration by patent offices during examination of the various applications derived from the PCT application, and potentially in time for it to be considered during any international preliminary examination performed by the IPEA.
Further, even if the applicant has filed other applications for the invention that are not derived from the PCT application, that applicant may be obliged to bring the cited prior art to the attention of the relevant patent office. Purely by way of example, it is possible that the applicant may pursue a separate US patent application not derived from the PCT application. Prior to grant of the US application, the applicant will have an obligation to disclose to the US PTO any relevant prior art that the applicant is aware of, and hence is likely to be obliged to forward to the US PTO any prior art identified in such an observation filed on the PCT application.
In summary, this third party observation route may be worthy of consideration in some cases, due to the wide dissemination of the observation, and the relatively early stage that the observation is made. For further information, please contact your D Young & Co attorney.
Article 4: Valuing IP - UK Industry Survey Results
DYoung & Co recently collaborated with Eureka (‘the magazine for engineering design’) to run an IP survey, seeking to gain insight into the approach that UK industry takes to various aspects of intellectual property. We were delighted with the number of responses to our survey. The range of opinion from companies of all sizes was quite incredible. The results emphasised a number of common themes and concerns in UK industry about various aspects of intellectual property. In order to maximise the value of the survey we will soon be publishing a ‘Question & Answer’ section on our website (www.dyoung.com) dealing with specific questions and issues identified in the survey.
The results highlighted that the majority of businesses regularly assess the value of their intellectual property assets (albeit at varying time scales). In particular:
- 92% of respondents know what IP they own
- 83% believe IP is of importance to their company
- 66% consider IP when designing products
- 66% consider that they understand IP issues
However, in spite of numbers which suggest a good level of knowledge about IP and the perceived value to the company, only 48% thought that their IP assets were adequately protected and only 55% thought they exploited their IP assets effectively.
It begs the question; if so many companies believe IP is important to them and that they know what assets they own, then why do so many feel that they are not adequately protected or are unable to exploit their IP assets effectively?
What can be the reason for the mismatch?
Common concerns are cost, complexity and the perceived uncertainty of the IP system. Many respondents complained about the cost of obtaining patent protection in terms of legal fees paid to attorneys as well as government fees. There is no denying that protecting IP rights can be expensive, but remember that a patent is a legal document defining a monopoly for your company within a market. That monopoly can last for 20 years, giving your company an enormous competitive advantage.
That said, there are many ways to control costs and companies need to be tactical in selecting the elements of the IP that they seek protection for and how they do it.
The issue of enforcement costs was also identified by a large number of respondents. High Court litigation is indeed expensive, but what many companies don’t realise is that the Patents County Court was specifically set up to limit costs. It is proving a very popular forum which is fast, largely paper based and has caps on legal cost. It is ideal for SMEs.
In terms of ‘uncertainty’ there is a feeling among respondents that patents are worthless because they can be ‘broken’ or bypassed. Again, there is some truth here. An invalid patent can be revoked and careful analysis of weak patents can sometimes allow you to ‘design around’ them. This is the skill of the attorney. There is a balance in drafting a patent: too broad and it is likely to be invalid, too narrow and it exposes companies to the possibility of design arounds.
It is clear from the survey that in general, UK companies do not understand and appreciate the value of protecting the IP assets they own. The results also highlight that many misconceptions and misunderstandings exist, particularly in terms of how IP assets can be efficiently and effectively employed in a commercially valuable way. Patent attorneys should be able to help devise sensible IP strategies for businesses that fit their legal budget and future direction of the business.
Article 5: EPO Case Law - Ignoring it is a Procedural Violation
At the European Patent Office (EPO), it is almost always the case that the search, examining and opposition divisions will, when making decisions, follow the case law of the Board of Appeal when considering how the EPC ought to be applied. However, a decision of a Board of Appeal is legally binding only on the department of first instance and, likewise, a decision of an Enlarged Board of Appeal in respect of a referral from a Board of Appeal is binding on this Board of Appeal only. It can thus be potentially unclear whether it is required for the divisions to follow established case law rather than, for example, only preferable.
In decision T 313/10, the Board of Appeal considered a situation where the examining division’s reasoning for refusing the application was contrary to the established case law on computer-related inventions. In particular, this reasoning was in opposition to the Enlarged Board of Appeal decision G 3/08, to the now well-established case law of the Boards of Appeal and to the guidelines for examination.
The Board of Appeal found that both a) having a reasoning which was contrary to the established jurisprudence as set out in the guidelines at the time and b) ignoring the applicant’s observations that this approach was in breach of the guidelines were procedural violations.
Despite the appeal being dismissed on other grounds, this decision very helpfully clarifies that well-established case law of the Boards of Appeal has to be taken into account, even though each individual decision forming the case law does not have a binding character on future decisions.