27 April 2022

DABUS Exited with Fatal Exception: Human Agency Required in Development of an Invention

System ErrorIn a decision handed down on 13 April 2022, a panel of five judges of the Federal Court of Australia (‘Full Court’) overturned last year’s controversial ruling by Justice Jonathan Beach, determining that the (alleged) ‘AI inventor’ DABUS cannot be named as an inventor for the purposes of applying for a patent in Australia, and that the law requires the inventor to be a natural person or persons: Commissioner of Patents v Thaler [2022] FCAFC 62 (‘Thaler FC’).  Regular readers of this blog will recall that I tentatively predicted this outcome after observing the Full Court hearing earlier this year.  As it turns out, I need not have been so tentative in my prediction.  The decision of the appeals court was fast, unanimous and unequivocal.

The Full Court has taken a conventional approach to determining the meaning of the term ‘inventor’ in the Patents Act 1990, observing (at [83]) that ‘[t]he duty to resolve an issue of statutory construction is a text-based activity’ and that while it is ‘appropriate to consider policy considerations … the surest guide to ascertaining the legislative intention is the language of the text of the legislation itself’.  In the absence of an express definition of ‘inventor’ in the Patents Act, the Court turned its attention to the legislative history, and the overall statutory context, with particular (though not exclusive) reference to the provisions regarding entitlement to the grant of a patent set out in section 15(1) of the Act. 

The Court found (at [105]) that:

…the law relating to the entitlement of a person to the grant of a patent is premised upon an invention for the purposes of the Patents Act arising from the mind of a natural person or persons. Those who contribute to, or supply, the inventive concept are entitled to the grant. The grant of a patent for an invention rewards their ingenuity.

As to whether Dr Thaler, as the owner of DABUS and the person responsible for its creation and operation, could be entitled to the grant of a patent naming the AI machine as inventor, the Full Court found (at [113]) that:

It is not to the point that Dr Thaler may have rights to the output of DABUS. Only a natural person can be an inventor for the purposes of the Patents Act and Regulations. Such an inventor must be identified for any person to be entitled to a grant of a patent under ss 15(1)(b)-(d).

The Court also observed (at [115]) that while ‘the development of patent law since 1624 has not until now been confronted with the question of whether or not an inventor may be other than a natural person’, the law has ‘proceeded on the assumption that only a natural person could be an inventor’.  This includes the key High Court decisions in National Resource Development Corporation v Commissioner of Patents [1959] HCA 67 (‘NRDC’) and D’Arcy v Myriad Genetics Inc [2015] HCA 35 (‘Myriad’), in which the Court proceeded on the basis – as the Full Court put it at [116] – that ‘human agency was required in the development of the invention in suit’.

In criticising the approach taken by the primary judge, the Full Court stated (at [120]) that ‘the Court must be cautious about approaching the task of statutory construction by reference to what it might regard as desirable policy, imputing that policy to the legislation, and then characterising that as the purpose of the legislation.’  Furthermore, the Full Court noted (at [121]) that the case was decided subject to the agreed facts that DABUS was an inventor and that Dr Thaler was not, but that ‘the characterisation of a person as an inventor is a question of law’ and ‘[t]he question of whether the application the subject of this appeal has a human inventor has not been explored in this litigation and remains undecided.’ 

The decision brings Australia back into line with other jurisdictions, including the US, the UK, Germany, the European Patent Office and Taiwan, where the naming of a machine as inventor has been found to be incompatible with patent laws.  However, Dr Thaler’s legal avenues are not yet exhausted in Australia.  In an email to Law360 (paywalled, unfortunately) Professor Ryan Abbott (whose Artificial Inventor Project is the true driving force behind the DABUS patent applications and court cases) has confirmed that they ‘plan to seek leave to appeal’ to the High Court.  I am going to be less tentative this time, and predict that the High Court will deny any application for special leave.  The Full Court’s decision is plainly correct, and any amendment of the law to permit non-human inventors is now a matter for legislators, following appropriate public consultation and consideration of the full consequences of such a development.

Read on for a more detailed analysis of the Full Court’s decision.

The Full Court’s Reasoning in More Detail

A delegate of the Commissioner of Patents determined that Thaler had failed to comply with a requirement under regulation 3.2C(2)(aa) of the Patents Regulations 1991 that an international (PCT) application entering the national phase in Australia must ‘provide the name of the inventor of the invention’, and therefore that his application should be deemed to have lapsed in accordance with regulation 3.2C(5).

The Full Court observed (at [84]) that the requirement to name the inventor:

…as the Explanatory Statement makes clear, is for the purpose of ensuring that the entitlement of the applicant to be granted a patent is clear. The reference in the Explanatory Statement to “entitlement” picks up that term as it is used in the Patents Act to refer to the eligibility of an applicant (or “nominated person”) to the grant of a patent for an invention: see ss 33, 34, 59 and 113. Accordingly, we would understand the reference in reg 3.2C(2)(aa) to “inventor” and “invention” to have the same meaning as used in the Patents Act. “Inventor” is used in the Patents Act in s 15(1). The “invention” as that term is used in reg 3.2C(2)(aa) must be the invention the subject of the patent application.

The person who is, first and foremost, entitled to be granted a patent for an invention is, under section 15(1)(a), the inventor, while the definition of an ‘invention’ under the Act is expressly linked to the concept of a ‘manner of manufacture’ originally introduced in the English Statute of Monopolies enacted in 1624 (see Thaler FC at [85]).

In considering the history of the patents legislation, the Full Court noted (at [88]) that ‘the consideration for “the reward” of the grant of the patent in the form of a statutory monopoly has long been the disclosure of the invention to the public in a manner that enables a person skilled in the art to perform the invention upon the expiry of the term of the patent’ and that ‘a person’s entitlement to that reward is closely linked to the act of invention by the true and first inventor.’

Moving on through the historical cases and legislation, the Full Court subsequently observed (at [90]) that ‘[t]he role of the inventor has been repeatedly emphasised in the context of Australian patents legislation’ and (at [92]) that ‘the modern ground of revocation under s 138(3)(d) of the Patents Act – that the patent was obtained by fraud, false suggestion or misrepresentation – proceeds on the assumption that the language of the patentee in the specification reflects the representations made by the inventor to the Crown’.  Considering the history, the Full Court concluded (at [93]) that this ground of revocation is premised upon the fact that it is the inventor who makes representations in the specification about the nature of the invention to the authority responsible for the grant of a patent’ (emphasis in original).

The Full Court then looked to the entitlement to apply for a patent under earlier Australian legislation, and observed (at [98]) that ‘the ability of a person to make an application for a patent was predicated upon the existence of an “actual inventor” from whom the entitlement to the patent was directly or indirectly derived.’  Furthermore, when the current Patents Act 1990 was enacted, based in large part on the recommendations of the Industrial Property Advisory Committee (IPAC) in its report Patents, Innovation and Competition in Australia, there was no recommendation or subsequent indication of legislative intention that ‘the role of the inventor, as the person from whom the entitlement to the grant of the patent should be derived, would change’ (Thaler FC at [99]).

Unsurprisingly, the question of inventorship most commonly arises where there is a dispute over entitlement (e.g. ownership of a patent or application), and this is often because the identity and/or the contribution of one or more alleged inventors is contested.  In considering recent case law relating to inventorship under the 1990 Act, the Full Court made a number of further observations, including:

  1. ‘“Inventor” has long been held to bear its ordinary English meaning, being the person(s) responsible for making the invention, namely, “the person who makes or devises the process or product”’ (at [100]);
  2. ‘The inventor for the purposes of s 15(1)(a) is the person who is responsible for the “inventive concept”’ (at [101]);
  3. ‘Identification of the inventor within s 15(1) is of central relevance to the operation of the Patents Act and is intertwined with concepts material to the validity of patent applications and patents’ (at [102]);
  4. If the final concept of the invention as described in the specification and claimed in the claims would not have come about without a particular person’s involvement, then that person has an entitlement to the invention’ (at [103]).

The Full Court accepted (at [105]) that no court had previously been faced with the question of whether an AI machine could be an ‘inventor’, and thus that references to ‘person’ in the cases could not be taken definitively to mean that an inventor must be human.  However, considered in their totality and in context, the Full Court reached the conclusion that I quoted in the introduction above, and which bears repeating, that:

…it is plain from these cases that the law relating to the entitlement of a person to the grant of a patent is premised upon an invention for the purposes of the Patents Act arising from the mind of a natural person or persons. Those who contribute to, or supply, the inventive concept are entitled to the grant. The grant of a patent for an invention rewards their ingenuity.

Furthermore, the Full Court found that for any person other than the inventor to be entitled to the grant of a patent ‘there must be a legal relationship between the actual inventor and the person first entitled to the grant’ (at [107]).  In this, the Court (at [112]) disagreed with the primary judge that:

…one may construe each of ss 15(1)(a), (b), (c) and (d) as alternatives to the effect that, by operation of (b) and (c), a person identified, such as Dr Thaler, may draw entitlement to the grant of a patent from an inventor who is not the person identified in (a) (or indeed a natural person at all). To so find overlooks the scheme of the Patents Act that we have described, and fails to give s 15(1) a natural reading. It also overlooks the history of the development of the law of patents to which one is directed by the term “invention” in the chapeau to s 15(1), defined in the Patents Act by reference to the Statute of Monopolies.

Relevance of the High Court’s Words in NRDC and Myriad

In NRDC (1959) and Myriad (2015) the High Court was concerned not with inventorship, but with inventions – specifically with whether the subject matter claimed in each case was an ‘invention’ that was within the concept of a ‘manner of manufacture’ and thus eligible for patenting.  In Myriad (at [6]), the plurality of the High Court observed that:

As appears from s 6 of the Statute of Monopolies, an invention is something which involves “making”. It must reside in something. It may be a product. It may be a process. It may be an outcome which can be characterised, in the language of NRDC, as an “artificially created state of affairs”. Whatever it is, it must be something brought about by human action.

(Quoted by the Full Court in Thaler at [115], with emphasis added by the Full Court.)

The Full Court observed (at [116]) that:

The references to “human action” were deliberate. They pick up the requirement set out in NRDC that a manner of new manufacture bring about an artificially created state of affairs …. The assumption in both cases was that human agency was required in the development of the invention in suit. That approach accords with the legislative history to which we have referred, namely that the origin of entitlement to the grant of a patent lies in human endeavour, which is rewarded by the grant of a limited term monopoly.

Conclusion – an ‘Urgent’ Need for Consideration of AI Inventors?

The Full Court recognised (at [119]) that Dr Thaler (though, in reality, the puppet master here is Ryan Abbott) ‘no doubt intended to provoke debate as to the role that artificial intelligence may take within the scheme of the Patents Act and Regulations’ and that this debate is ‘important and worthwhile’.  I agree – although whether this justifies provoking test cases that occupy the resources of Australia’s federal court system is another matter.  The Full Court identified just a few of the questions that may require consideration:

  1. Whether, as a matter of policy, a person who is an inventor should be redefined to include an artificial intelligence?
  2. If so, then to whom (of many possibilities) should a patent be granted in respect of the output of an AI machine?
  3. Would the recognition of AI inventors require a recalibration of the standard of inventive step?
  4. How should the ground of revocation for false suggestion or misrepresentation be treated in circumstances where the inventor is a machine?

This highlights the great merit (and correctness) of the ‘whole of statute’ approach taken by the Full Court.  A central flaw the approach taken by the primary judge lay in his failure to properly consider the full consequences of expanding the concept of an inventor in the context of the legislative history and overall operation of the Patents Act.  The Full Court, in contrast, has recognised that the patent law is a complex edifice with a long history and many interrelated parts, and that to change one key element without due regard to the whole has the potential to produce unintended, and perhaps undesirable, effects.

I disagree, however, with the Full Court’s observation (at [120]) that ‘[h]aving regard to the agreed facts in the present case, it would appear that [the issues] should be attended to with some urgency.’  This presupposes that the agreed facts are actual facts, for which there is scant evidence.  Indeed, if the agreed facts are true then we must accept that Dr Thaler, working alone and without the massive financial resources devoted to the field by big tech companies such as Google, Meta (i.e. Facebook), Amazon, Microsoft and others, has uniquely succeeded in devising a truly creative machine capable of autonomous invention!

Personally, I am more inclined to take the word of IBM which, in a submission to a USPTO consultation on ‘Patenting Artificial Intelligence Inventions’, stated that:

The most intelligent machines are able to find relationships between many parameters, but they cannot independently recognize or confirm the value of such relationships, and thus have no cognition that an invention has been made. Even machines with the intelligence to adjust their own algorithmic coefficients – in a sense, reprogramming themselves – have no appreciation of the technical or societal value of those adjustments absent humans. Intelligent machines will remain tools that assist humans, rather than invent independently, for a considerable time.

While this may come as a disappointment to enthusiasts cheering on the ‘rise of the machines’, for the rest of us it is good news.  Certainly machines are becoming ever more powerful tools enabling new developments and discoveries across many fields of science and technology.  But for the foreseeable future, at least, they will not be supplanting human ingenuity.  And this also allows us ample time to consider the impact of these developments on patent law – and, indeed, intellectual property laws more broadly.  Let us not be enticed by a false sense of urgency into making hasty decisions that we may one day come to regret.


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