Software patents under the European Patent Convention

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Even though the European Patent Convention and its Article 52 excludes the patentability of programs for computers as such and despite the fact that the European Patent Organisation (EPO) subjects patent applications in this field to a much stricter scrutiny ^[1] when compared to their American counterpart, that does not mean that all inventions including some software are de jure not patentable.

1 Article 52 EPC
2 Patentability under European Patent Office case law
3 Enforceability before national courts
4 Directive on the patentability of computer-implemented inventions
5 Statistics
6 Further reading
7 See also
8 References
9 External links

[edit] Article 52 EPC

The European Patent Convention (EPC), Article 52, paragraph 2, excludes from patentability, in particular

discoveries, scientific theories and mathematical methods;
aesthetic creations;
schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers;
presentations of information. (emphasis added)

Paragraph 3 then says:

(3) The provisions of paragraph 2 shall exclude patentability of the subject-matter or activities referred to in that provision only to the extent to which a European patent application or European patent relates to such subject-matter or activities as such. (emphasis added)

The words "as such" have caused patent applicants, attorneys, examiners, and judges a great deal of difficulty since the EPC came into force in 1978. The Convention, as with all European law, should be construed using a Purposive Approach. Unfortunately, the purpose behind the words and the exclusions themselves is far from clear.

Some people believe that the words "as such" should be interpreted to mean "if any computer program (or anything else in paragraph 2) is in the claim of the patent application", but this is an extreme interpretation which would result in any invention that even peripherally involves a computer program being rejected as unpatentable.

A second interpretation is that any invention in which the novel and inventive characteristics are realised by a computer program should be excluded, even if that computer program is being used to control something that is exterior to the computer in a useful or advantageous way.

A third intrepertation is that patents involving computer programs should be acceptable (so long as they meet the other requirements for patentability such as novelty and inventive step) provided that they result in a useful effect outside of the computer - e.g. controlling a robot arm or an automated factory. See T26/86, Koch and Sterzel, X-Ray apparatus for an example of such an invention. A variation on this interpretation is that patentable inventions should relate to the control of natural forces.

The lobbying association, Foundation for a Free Information Infrastructure (FFII), appears to be in favour of an interpretation that is along the lines of either the second or third interpretations listed above [1].

Another interpretation, which is followed by the Boards of Appeal of the EPO, is that an invention is patentable if it provides a new and non-obvious technical solution to a technical problem. The problem, and the solution, may be entirely resident within a computer such as a way of making a computer run faster or more efficiently in a novel and inventive way. Alternatively, the problem may be how to make the computer easier to use, such as in T928/03, Konami, Video Game System.

The position of the EPO can be contrasted with that of other patent offices with more liberal policies concerning the patenting of computer-implemeted inventions such as the US Patent and Trademark Office and the Australian Patent Office. In these countries, the mere use of a computer is sufficient to make a business method patentable even if the computer is not being used in a novel or inventive way and only the underlying business method provides the patentable features. Such a position has been specifically rejected by the EPO in decisions such as the Hitachi/Auction method decision.

[edit] Patentability under European Patent Office case law

Like the other parts of the paragraph 2, computer programs are open to patenting to the extent that they provide a technical contribution to the prior art. In the case of computer programs and according to the case law of the Boards of Appeal, a technical contribution typically means a further technical effect that goes beyond the normal physical interaction between the program and the computer.

Though many argue that there is an inconsistency on how the EPO now applies Article 52, the practice of the EPO is fairly consistent regarding the treatment of the different elements of Article 52(2). A mathematical method is not patentable, but an electrical filter designed according this method would not be excluded from patentability by Article 52(2) and (3).

According to the jurisprudence of the Boards of Appeal of the EPO, a technical effect provided by a computer program can be, for example, a reduced memory access time, a better control of a robotic arm or an improved reception and/or decoding of a radio signal. It does not have to be external to the computer on which the program is run; reduced hard disk access time or an enhanced user interface could also be a technical effect.

[edit] Patentable subject-matter test

Rather recently, a shift occurs in the case law. The "contribution approach", used to assess what was regarded as an invention within the meaning of Art. 52(1) and (2), was dropped. According to the "contribution approach" (see for instance T 52/85), the claimed subject-matter did not concern an invention within the meaning of Article 52(1) EPC when no contribution was made in a field not excluded from patentability. The "contribution approach" was a disguised inventive step assessment. Recent decisions, such as T 258/03, have made it clear that the contribution approach was no longer applicable. Indeed

"The structure of the EPC (...) suggests that it should be possible to determine whether subject-matter is excluded under Article 52(2) EPC without any knowledge of the state of the art (including common general knowledge)" (T 258/03, Reasons 3.1).

It now suffices that a physical entity or activity involves technical means to be considered as an invention within the meaning of Article 52(1) EPC.

But the patentable subject matter test of Article 52(2) and (3) is only the first step towards patentability. Computer programs can also be refused and are often refused on the ground of lack of inventive step, which can be relatively easier to assess in certain cases. As a Board of appeal put it in T 258/03 (Reasons 4.6) in relation to the fact that the "contribution approach" was no longer applicable,

"[we are] aware that [our] comparatively broad interpretation of the term "invention" in Article 52(1) EPC will include activities which are so familiar that their technical character tends to be overlooked, such as the act of writing using pen and paper. Needless to say, however, this does not imply that all methods involving the use of technical means are patentable. They still have to be new, represent a non-obvious technical solution to a technical problem, and be susceptible of industrial application."

[edit] Inventive step test

The broad interpretation of the term "invention" in the patentable subject-matter test, as used by the Boards of Appeal, has come with an adjustment of the case law relating to the inventive step requirement. It has now become clear that any non-technical feature, i.e. a feature from a field excluded from patentability under Art. 52(2), cannot be taken into account for the assessment of inventive step. Likewise, the "state of the art" (used as the starting point from the inventive step assessment) should be construed as meaning the "state of technology" (T 172/03 [2]), and the person skilled in the art is the person skilled in the relevant field of technology (T 641/00 [3]). Fields excluded under Art. 52(2) are not considered part of the technology for the assessment of inventive step.

Thus an expert in marketing or insurance policies for instance cannot be chosen as the fictional person skilled in the art, while a computer hardware or memory management expert may be chosen as the reference fictional person. This means that the mere implementation of a business method on a computer or computer network rarely involves an inventive step, while improving a computer-assisted industrial process or providing a more efficient memory management within a computer may involve an inventive step.

The case law of the EPO Boards of Appeal is not binding on the first instance departments of the EPO (i.e. the Examining Divisions), and different Examining Divisions of the EPO may assess patentability differently. Likewise, during an opposition procedure before the EPO, where the grant of a recently granted European patent may be opposed by a third party (opponent), the patent may be revoked if the Opposition Division form a different view on whether or not the invention in question was patentable.

[edit] Relevant decisions

In chronological order (with date of decisions).

T 208/84, VICOM [4] - July 15, 1986
T 26/86, Koch and Sterzel, X-Ray apparatus [5] - May 21, 1987
T 38/86, IBM, Text processing [6] - February 14, 1989
T 52/85, IBM [7] - March 16, 1989
T 158/88, Siemens [8] - December 12, 1989
T 769/92, Sohei [9] - May 31, 1994
T 1173/97, IBM [10] (on the "further technical effect") - July 1, 1998
T 931/95, Pension Benefit System [11] - September 8, 2000
T 1001/99, Geodynamik, Measuring compaction degree of a surface [12] - June 27, 2002
T 641/00, Comvik, Two identities [13] - September 26, 2002
T 258/03, Hitachi, Auction Method [14]- April 21, 2004
T 914/02, Nuclear core loading arrangement [15] - July 12, 2005
T 0049/04, Walker, Text Display [16] - October 18, 2005
T 0424/03, Microsoft, Clipboard [17] - February 23, 2006
T 928/03, Konami, Video Game System [18] - June 2, 2006

[edit] Enforceability before national courts

The case law of the EPO Boards of Appeal is not binding on the EPO member states and different national courts acting on different cases may take a different view of patentability under Art. 52(2) EPC. A European patent on a computer-implemented invention, like each and every European patent no matter what it relates to, may therefore be issued by the European Patent Office, but subsequently it may potentially be revoked in a patent infringement lawsuit or revocation proceedings before a national court if new evidence or prior art arises, or even if the national courts just believe the EPO made an error in granting the patent.

Although the national courts are independent of the EPO, the patentability of software related inventions is, to some degree, consistent across Europe. This is exemplified by the statements of Peter Prescott QC, while sitting as a Deputy Judge in the UK High Court, in consideration of CFPH's applications. He noted that the EPO decisions are prescriptive, but not binding on the UK courts, but also recalled the judgement of the Court of Appeal in Fujitsu's application which stated that it would be disastrous if there was any substantial divergence between the interpretations given by the UK courts and the EPO to Article 52(2) EPC.

The judgement in CFPH's applications was the first in a flurry of UK court cases since 2005 involving re-consideration by the High Court of patent applications refused by the UK Patent Office. Software patents under United Kingdom patent law refers to a number of leading cases, but the judgement in CFPH's applications is notable due to its many references to the practice of the EPO.

The two patent applications in question both involved networked interactive wagering on the outcomes of events. Each application was refused as relating to a method of doing business as such. The applications were not refused as relating to a computer program as such, because the computer program was simply a tool that was being used to implement a new set of business rules and the invention was not really about the computer program. Although the judgement stressed that the reasoning used was quite different from the type that would have been applied by the EPO, the judge appeared satisfied that the EPO would have come to the same conclusion using their own reasoning.

The CFPH judgement is often held up by anti-software patent campaigners as an example of a national court being critical of the practice of the EPO. However, the judgement does not criticise the EPO's practice of granting patents to inventions that involve or even rely entirely on software. Instead, the EPO's reliance on the word "technical" is criticised, but the judgement goes on to say that the two modes of reasoning used by the UK courts and by the EPO, although different, would usually produce identical results on the same set of facts if properly applied. Another criticism actually suggests that the EPO are being too strict by insisting that an invention must provide a technical contribution, and not merely a business based contribution since, as evidenced by the judgment in Dyson v Hoover the commercial background to an invention may be important when determining the presence or otherwise of an inventive step.

In Research In Motion UK Ltd. v Inpro Licensing SARL, the UK High Court had the rare opportunity to consider a patent that had been granted by the EPO. The patent involved the 'pretreating' of web pages before they were downloaded to machines of modest processing capacity. Mr Justice Pumfrey came to the conclusion that the claimed invention was obvious, but specifically rejected the allegation that it was excluded from patent protection as a computer program as such. He noted that "all modern industry depends upon programmed computers, and one must be astute not to defeat patents on the ground that the subject matter is excluded under Article 52 unless the invention lies in excluded subject matter as such" (emphasis added).

In Germany in the case Logikverifikation (13 December 1999), the German Federal Court (German: Bundesgerichtshof or BGH) ruled on a case involving a European patent claiming a computer-implemented invention, namely a "method for hierarchical logic verification of highly-integrated circuits". Going against the run of previous case law, it overruled the German Federal Patent Court (German: Bundespatentgericht or BPatG), and came to the conclusion that the claimed subject-matter did properly meet the 'technical' requirement, was not excluded from patentability and therefore the patent should be allowed.

BPatG objections were also overruled in the decisions Sprachanalyseeinrichtung (German BGH, 11 May 2000) and Suche fehlerhafter Zeichenketten (German BGH, 17 October 2001) [19]; but it should be remembered that in the civil law tradition of mainland Europe legal precedent does not necessarily acquire the same formally binding character that it assumes in the common law traditions typical of most English-speaking countries.

In fact, more recently the same court has repeatedly upheld the rejection of monopoly claims to computers and programs operating theron, as in Erfassung und Übertragung von Betriebsdaten eines ersten medizintechnischen Geräts an eine zentrale Datenbank [20] as well as in Verfahren zum Betrieb eines Kommunikationssystems [21].

[edit] Directive on the patentability of computer-implemented inventions

Main article: EU Directive on the Patentability of Computer-Implemented Inventions.

Proposed in 2002, one motivation at least for the controversial draft EU Directive on the Patentability of Computer-Implemented Inventions was to have been to establish common practice for the national courts; and, in cases of doubt as to its interpretation, to have created a requirement for national courts of last instance to seek a ruling from the European Court of Justice. Even though Switzerland for instance is a member of the European Patent Organisation but not a member of the European Union, the EPO also signalled that it would have been likely to adjust its practice, if necessary, to conform with whatever text had finally emerged from the EU legislative procedure,

However, the directive became highly controversial, drawing increasing legislative notoriety to this area of European law. Proponents of the Directive claimed its purpose was to clarify the meaning of Article 52, by consolidating existing EPO practice. Opponents claimed the Directive would dismantle perceived more stringent restrictions against software patenting employed or employable by national courts, and lead to an increased assertion of patents on software Union-wide across the EU. After a history of procedural wrangling, and sustained lobbying and publicity efforts from both sides, the Directive, which had largely been supported by the European Commission and most member-state governments in contrast with their the national parliaments, was overwhelmingly rejected by the European Parliament on 6 July 2005, terminating the legislative procedure.

This failure to reform the exclusion of software followed the failed attempt to delete programs for computers from Art. 52(2)(c) of the convention in 2000 at the diplomatic conference in Munich. At the time the reform was explicitly derogated in order to await the outcome of the consultation process for this EU Directive.

Final interpretation of the law in this area thus continues to be the responsibility of national courts, following national case-law (except when a European patent application is refused or when a European patent is revoked in opposition proceedings before the EPO, in which case the EPO has the final say regarding the interpretation of the EPC). A decisive supra-national authority for European patent law cases could be created under either proposals for the Community patent or the European Patent Litigation Agreement. As of early 2006 these are the subject of a public consultation by the EU Commission, preparatory to new expected legislative activity.

[edit] Statistics

According to a European Commission press release of 2002, "since the EPC came into force in 1978, at least 30,000 patents for computer-implemented inventions have already been issued [by the EPO]". ^[2]

[edit] Further reading

Keith Beresford, Patenting Software Under the European Patent Convention, Sweet & Maxwell, 2000. ISBN 0-7520-0633-9.
European Patent Office, Case Law of the Boards of Appeal of the European Patent Office, Fourth Edition, 2002, European Patent Office DG3 - especially sections I.A.1, I.A.1.1 and I.A.1.2 on pages 1 to 8, (2.4 Mb pdf document- pdf pages 31 to 38)