Upcoming Online Conference on ‘Inventorship in Patent Law’

On Monday 16 May 2022 the European Patent Office (EPO) is running an online conference on ‘Inventorship in Patent Law’.  It commences at 1.30pm Central European Summer Time (CEST), which is 9.30pm on the east coast of Australia (AEST), 9.00pm in South Australia, and a positively civilised 7.30pm in Western Australia.  It is, unfortunately, a little less accessible to people in New Zealand, where it will be 11.30pm.  The total running time is two hours and forty minutes, so the event will finish a little after midnight here in Melbourne.

I am promoting the conference because I will be participating on a panel discussing the DABUS ‘AI inventor’ decisions in various jurisdictions.  It is not in doubt that I will be the least illustrious of the panellists.  The other participants are:

1. Wolfgang Sekretaruk, who is Chairman of the Legal Board of Appeal of the EPO, Deputy of the President of the Boards of Appeal and Head of the Legal Services of the Boards of Appeal, and will be discussing the EPO decisions on the DABUS applications;
2. Professor Duncan Matthews, of the Queen Mary, University of London School of Law, who will be discussing the UK decisions;
3. Professor Dr jur. Ansgar Ohly, of the Ludwig Maximilian University of Munich, and the University of Oxford Faculty of Law, who will be discussing the German case; and
4. Professor Dan L Burk of the University of California, Irvine, who will be discussing the US case.

I will, of course, be talking about the position in Australia – which is arguably the most interesting, given that we were the only country to (briefly) recognise DABUS as a legitimate inventor.

Our session of the conference will comprise a series of brief (10 minute) presentations on the position in each jurisdiction, followed by a 30 minute panel discussion.

Prior to the panel session, there will be a 20 minute presentation from Axel Voss, Member of the European Parliament, on the European approach to AI.  This will be followed by an introduction to the DABUS applications by the EPO’s Heli Pihlajamaa as a lead-in to the panel.

The panel session will be followed by a presentation on ‘the right to a patent, its origins and the consequences of the fundamental principle that the right to the patent is originally vested with the inventor’ from Martin Stierle, Associate Professor in Intellectual Property Law at the Faculty of Law, Economics and Finance at the University of Luxembourg.

The conference is free of charge, however registration is required in order to obtain the link to the online session (via Zoom).  Registered trans-Tasman patent attorneys should be able to claim 2.5 CPE hours for attendance at the full event.

 Read full article ► 

Tags: Artificial intelligence, Australia, DABUS, European Patent Office, Germany, Inventorship, UK, US

DABUS Again Denied in the US and the UK, Part III – Implications for Australia

In both the US and the UK, patent offices have refused to allow applications filed by Dr Stephen Thaler to proceed, on the basis that the named inventor – an ‘AI’ machine dubbed DABUS – is not a human being.  In the first article in this series I looked at the US approach to the role of the inventor in patent law and practice, and at the recent decision of Judge Leonie M Brinkema in the United States District Court for the Eastern District of Virginia (‘EDVA’) upholding the USPTO’s decision.  In the second, I discussed the split decision of the Court of Appeal of England and Wales, which upheld (by a 2-1 majority) the decisions of the UK Intellectual Property Office (UKIPO) and the High Court.

In Australia, the Patent Office also refused to allow a corresponding application by Dr Thaler to proceed.  In contrast to the US and the UK, however, that decision was overturned by Justice Beach in the Federal Court.  The Commissioner of Patents has now appealed that ruling to a Full Bench of the Court (case no. VID496/2021).  In this article, I will be looking at the potential implications of the recent US and UK decision for the conduct and outcome of the appeal in Australia.

It should be said at the outset that the US law is very different to that of Australia, and it is therefore unlikely that anything in Judge Brinkema’s legal reasoning will be influential upon the Full Court.  It has also become apparent through the UK High Court and Court of Appeal decisions that while the UK law shares some similarities with the corresponding provisions of the Australian Patents Act 1990, there are also some significant differences.  Even so, there are aspects of the reasoning of Lord Justice Arnold in the Court of Appeal that the Australian appeals court may consider persuasive, and that could therefore influence the outcome here.

There are two key questions likely to be addressed in the appeal, both of which also arose in the UK, although only the first received substantive attention in the US.  These are:

1. Can DABUS, as an ‘AI’ machine and not a human being, validly be named as an inventor on a patent application?
2. Can Dr Thaler, not being (at his own insistence) the inventor, establish a proper legal basis for entitlement to the grant of patents on inventions said to be generated by DABUS?

I shall look at each of these questions in turn.

 Read full article ► 

Tags: Artificial intelligence, Australia, DABUS, Inventorship, Patent law, UK, US

DABUS Again Denied in the US and the UK, Part I – the Approach in the US

On 27 August 2021, the Commissioner of Patents lodged an appeal (case no. VID496/2021) against the decision of Justice Beach in the Federal Court of Australia finding that the ‘AI’ machine known as DABUS could be named as sole inventor on an Australian patent application.  Unusually, and presumably in recognition of the media and public interest generated by this case, IP Australia took the step of announcing the filing of the appeal, while emphasising that ‘[t]he appeal is centred on questions of law and the interpretation of the patents legislation as it currently stands’ and that ‘[t]he decision to appeal does not represent a policy position by the Australian Government on whether AI should or could ever be considered an inventor on a patent application.’  The appeal will most likely be heard by a Full Bench of the Federal Court comprising three judges, although in rare cases deemed sufficiently significant a five judge panel may be assigned.  A hearing could take place as early as November this year, but at this stage it seems more likely to be scheduled for early in 2022.

In the meantime, however, parallel test cases initiated by Surrey University Professor Ryan Abbott’s Artificial Inventor Project have been making their way through the US and UK courts.  On 2 September 2021, Judge Leonie M Brinkema in the United States District Court for the Eastern District of Virginia (‘EDVA’) rejected Dr Stephen Thaler’s appeal against the USPTO’s decision to refuse two patent applications on the basis that DABUS is not a human being and therefore cannot be an inventor under US law (Stephen Thaler v Andrew Hirshfeld and the US Patent and Trademark Office, Mem. Op. [PDF 998kB]).  And on 21 September 2021, a majority of the Court of Appeal of England and Wales (Lord Justice Arnold and Lady Justice Elisabeth Laing, Lord Justice Birss dissenting) upheld a decision of the High Court which agreed with the UK Intellectual Property Office (UKIPO) that Thaler’s applications should be deemed withdrawn because of his failure to identify a natural person as inventor (Thaler v Comptroller General of Patents Trade Marks And Designs [2021] EWCA Civ 1374).

These cases are, of course, of interest because they concern the fascinating question of whether non-human machines can be inventors for the purposes of obtaining patent.  But they are also interesting for what they reveal about the differences between the treatment of inventors under US and UK law.  In the US the inventor is central and indispensable – a position that arguably derives ultimately from the Constitutional authority for Congress to make laws ‘promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries’.  In the UK, however – and in the view of Birss LJ in particular – the identity of the inventor is almost irrelevant in the majority of patents applied for, prosecuted and granted.

I will cover these latest developments in the DABUS saga over a series of three articles.  In this first article, I will look at the approach taken to the role of the inventor in the US, how it differs from other jurisdictions, and the recent decision from the EDVA.  The second article will cover the split decision in the UK, and how the differing opinions of eminent patent jurists Arnold LJ and Birss LJ stack up.  Finally, in the third part I will look at where Australia sits, and consider whether either of the US and UK decisions may be of any relevance in the upcoming Full Court appeal.

 Read full article ► 

Tags: Artificial intelligence, DABUS, Inventorship, Patent law, UK, US

Latest Annual US Patent Litigation Data From Lex Machina Provides Insights Into the ‘Troll Narrative’

Although there are various accounts of the story – particularly as people’s memories start to fade – there is little doubt that the term ‘patent troll’, as currently employed, has its origins at Intel at around the turn of the 21^st century.  As Brenda Sandburg reported at the time (in 2001), Intel’s Peter Detkin defined a ‘patent troll’ as ‘somebody who tries to make a lot of money off a patent that they are not practicing and have no intention of practicing and in most cases never practiced.’  Ironically, Detkin subsequently went on to become a founder of Intellectual Ventures (IV), a company that has made a great deal of money from patents that it is not practicing, has no intention of practicing, and has never practiced.

Sorry – it seems I have that wrong.  According to IV’s profile of co-founder Nathan Myhvold, the company is actually ‘building a market for invention’ to enable inventors to ‘realize the value of their ideas’. It ‘manages one of the largest and fastest growing intellectual property (IP) portfolios in the world, with more than 40,000 assets and more than $6 billion in total committed capital’ and its investors include ‘many of the world’s most innovative companies and renowned academic and research institutions.’  All of which actually sounds kind of like a good thing, and not at all troll-y.  It is also notable that Detkin’s original definition would encompass most universities and research institutes.

So, where does the truth lie?  Somewhere between the two extremes, no doubt, as technology analyst Roger Kay has eloquently explained in an article on Medium this week, Where did the Patent Troll Narrative Come From?  At one end of the spectrum, there are certainly genuinely predatory ‘trolls’ using the patent system to extort payments from companies that lack the resources to fight back.  At the other end, however, are big tech companies, like Intel, Google, Facebook, and Apple, which have adopted a strategy of ‘efficient infringement’ – the practice of using a technology that infringes on someone’s patent, ignoring the patent holder entirely, and when (or if) the patentee decides to sue, tying them up in court by challenging the patent’s validity.  As I have argued in the past, slapping the positive word ‘efficient’ on the front does not alter the reality that this is also an abuse of the system, and of the infringers’ superior economic power.

In other words, it’s complicated.  As Kay notes:

Among combatants in the patent wars, entities are divided along multidimensional lines: practicing vs. non-practicing, dominant vs. upstart, technological vs. financial, inventing vs. acquiring, licensing vs. using internally, R&D-oriented vs. manufacturing-oriented, invention-focused vs. product-focused. While some of these creatures are truly odious, using the word “patent troll” to describe any of them would be to allow Intel and its allies ownership of the narrative. There are no hard and fast rules to separate them into good and bad buckets.

The latest Patent Litigation Year in Review report, from legal analytics company Lex Machina, provides some insights pertinent to the troll narrative, and in particular the impact of changes in US patent law driven, in large part, by lobbying from the ‘efficient infringer’ constituency which, as noted in this IAM Media article, ‘invested large sums in spreading a narrative around the problems posed by “patent trolls” that has been used to justify the need for a re-engineering of the US system to make it less friendly to all rights owners.’

Lex Machina’s analysis shows that since the commencement of the US patent law reforms introduced by the America Invents Act (AIA), rates of patent litigation have been in steady decline in real terms.  Furthermore, while the list of top plaintiffs remains dominated by non-practising entities (NPEs), in 2017 two pharmaceutical companies entered the top ten, with two more filling out the top 15.  And while headlines tend to be captured by a small number of very high awards of damages against big infringers, the reality for most plaintiffs is sobering.  Just 11% of all cases terminated since 2000 reached a final judgment, with around three-quarters settling.  While patentees are victorious slightly more often than defendants (around 60/40), compensatory damages are awarded in less than half of the cases won by plaintiffs, and for those cases in which ‘reasonable royalty’ damages were awarded during the three years up until the end of 2017, the median amount was just US$4.4 million – perhaps barely enough to justify litigation in a jurisdiction where the usual rule is that each party must bear its own costs of the proceedings.

While this might be bad news for the genuine trolls in the system, it is at least as bad – if not worse – for individual inventors, research groups, universities, and other innovators who are better-placed to invent than they are to commercialise their inventions, and therefore rely on licensing to secure a return from their efforts.

 Read full article ► 

Tags: Economics, Patent litigation, Trolls, US

New USPTO Data Set Reveals Extent of Patent-Eligibility Confusion and Carnage

A new research dataset released by the US Patent and Trademark Office (USPTO) reveals that since the Supreme Court of the United States (SCOTUS) issued its 2010 ruling in Bilski v Kappos, the rate at which US patent applications are rejected on subject-matter grounds (as compared with other grounds of rejection) has increased from 8% to 13%.  (A hat-tip, by the way, to Dennis Crouch at the Patently-O blog for bringing this new dataset to my attention, and using it to compare rates of anticipation and obviousness rejections over the period covered by the data.)

As interested followers of patent-eligibility (you know who you are) will be aware, during this period the Supreme Court has issued four opinions restricting the scope of patentable subject matter: Bilski v Kappos 130 S.Ct. 3218 (2010), relating to ‘pure’ business methods; Mayo v Prometheus 132 S.Ct. 1289 (2012), relating to diagnostic methods; AMP v Myriad 133 S.Ct. 2107 (2013), relating to isolated genetic materials; and Alice v CLS Bank 134 S.Ct. 2347 (2014), relating to computer-implemented business methods.  Each of these decisions resulted, at least initially, in an increase in subject-matter rejections by the USPTO in the corresponding fields of endeavour.  And while there have been subsequent declines in the rates of Bilski- and Myriad-based rejections, the signs are that rates of rejection based on Mayo and Alice are at least steady, and possibly increasing.

Notably, updates to USPTO examination guidance on subject matter eligibility in July 2015 and May 2016, which were regarded by many as providing much-needed clarification expected to reduce the rates of rejection, do not appear to have had any impact on overall subject-matter rejection rates, or on the rates in the specific fields most affected by Bilski, Alice, Myriad, and Mayo.

Overall, the SCOTUS impact since 2010 appears to have been an increase in the relative number of patent-ineligible inventions for which applications are filed at the USPTO, averaged across all fields of endeavour, of around 60%!  Another, more pragmatic, way of looking at the data is to say that for every 100 applications filed, around five (i.e. one in 20) will now be rejected on subject-matter grounds, that would not have been rejected prior to June 2010.  Of course, the retrospective effect of the Court’s determinations on eligibility means that patents previously granted are not saved by preceding the recent decisions, which is why there has also been carnage in the US Federal Courts.

This all creates additional uncertainty around the availability and value of patents in affected technology areas, to the detriment of investors, innovators, and the patent system itself.

 Read full article ► 

Tags: Biotechnology, Business processes, Computer programs, Diagnostic methods, Patent analytics, Patentable subject matter, US

The USPTO Art Groups That Are Patent Application Purgatory

A very common question asked by patent applicants is ‘how long will it be until I receive a patent?’  The usual legalese answer to this is, of course, ‘it depends’.  But upon what does it depend?  Some of the factors are within an applicant’s control, such as whether they request examination at the earliest opportunity (in jurisdictions where a separate examination request is required), whether they request expedited/accelerated examination (where it is possible to do so), and how quickly they respond to office actions, pay required fees, and so forth.  But after taking all of this into account, there is still a great deal that is beyond the control of the applicant.

Additional factors that can delay grant of a patent include the backlog of applications in the relevant patent office, the nature of any objections raised by the examiner, and the difficulty of overcoming the objections – either due to their inherent merit, or to the determination of the examiner to maintain the objections in the face of the applicant’s best efforts to present amendments and persuasive arguments.  After all this, however, if the applicant perseveres and is looked upon kindly by the fates, a patent will eventually issue.  But how long after filing will that happen?

The US Patent and Trademark Office (USPTO) has a goal of reducing the average value of what it calls ‘Traditional Total Pendency’ (TTP) to 20 months by 2019.  The TTP is defined as the time between the patent application filing date (which is the date of national phase entry in the case of an international application under the Patent Cooperation Treaty) and ‘final disposition’, i.e. issued as a patent or abandoned.  According to data that can be viewed via the USPTO’s Data Visualisation Center Patents Dashboard, the TTP as of June 2017 is 24.7 months.  However, this number really does not tell the whole story for many applicants.

For one thing, this TTP metric does not take into account applications in which a Request for Continued Examination (RCE) has been filed.  An RCE is typically necessary where an applicant has not managed to secure allowance of an application following a second round of examination, but is not ready to give up and abandon the application.  In many technical fields, the filing of at least one RCE in the course of examination is extremely common.  When RCEs are taken into account, the TTP sits at around 32 months.

Furthermore, ‘average pendency’ characterises the complex process of examination, which occurs across applications in all fields of technology, using just a single statistic, which can be very misleading.  As I will show in this article, average pendency (inclusive of RCEs) varies from 22 months in the fastest examination group to more than 57 months in the slowest (and that is assuming that a patent ever issues at all).  Additionally, the distribution of application pendency varies enormously between different technology groups.  In the slowest group, over an eighth of all applications that ultimately issue as patents take more than eight years to do so.  If your application ends up in that particular cohort, it is of little comfort to know that the average pendency in the group is less than five years!

For rapid processing of your US patent applications, the best fields to be in include semiconductor device fabrication, vehicular technology, telecommunications, and pharmaceuticals.  The worst (perhaps unsurprisingly) include fintech and e-commerce, genetic technologies, and surgical methods and devices.

 Read full article ► 

Tags: Patent analytics, PEDS, US

Identifying Patent-Eligible Software Claims... Using Software

As I have previously reported, the major and immediate impact of the US Supreme Court’s Alice decision in June 2014 was to reduce the rate of ‘business method’ patents issued by the US Patent and Trademarks Office (USPTO) by three-quarters, while having a negligible effect on ‘technical’ software-implemented inventions.  While the data in my earlier article ended in December 2015, I have now been able to update my results to the end of March 2017, as shown in the chart below.  There has been no change in the overall trend during the intervening 15 months, with ‘business method’ patent grants still running at around 50% of 2007 numbers, while technical software patents, and patents across all areas of technology, are issuing at rates nearly twice those of 2007.

In a recent post on the Bilski Blog, US patent agent Mark Nowotarski has made similar observations about the impact of Alice on ‘business method’ patent grants, going on to analyse the characteristics of those patent claims are are still being allowed in the USPTO’s business method Art Units.  He has noted that it is commonly by including ‘physical limitations’ (e.g. reciting hardware such as ‘mobile devices/sales kiosks’ or ‘physical sensors’) and/or ‘software limitations’ (e.g. reciting technical functionality such as ‘graphics/ image processing’ or ‘cryptography/security’) that applicants have been able to overcome Alice-based subject-matter rejections.

This got me thinking.  If there are common forms of technical language that arise in patent-eligible claims, then might it be possible to train a machine-learning system to predict whether a particular claim is, or is not, likely to be patentable?

It turns out that this does indeed appear to be possible.  I built a machine-learning model using data published by the USPTO, including the claims of 24,462 recently-abandoned 4967 recently-allowed applications, all examined within ‘software’ and ‘business methods’ Art Units.  In cross-validation tests (i.e. using a portion of the known data for training, and the remainder to test model performance) I was able to achieve around 75% prediction accuracy.  In trials of a hand-picked ‘random’ sample of more recent patents and published applications, not in the training/test set, the model correctly classified all actually allowed claims (of four examples) as patentable.  It also classified the claims of four abandoned applications as unpatentable, and two published-but-rejected-and/or-amended claims as unpatentable.  In only one case did the model classify a claim that had been rejected on subject-matter grounds as likely-patentable.

The model may thus be capable, with a probability of success of over 70%, of determining whether or not a proposed claim to a computer-implemented invention includes sufficient technical content to overcome a subject-matter-based rejection, at least under the Alice test as it is applied by the USPTO.

 Read full article ► 

Tags: Business processes, Computer programs, Machine learning, Patent analytics, Patentable subject matter, PEDS, US

University of California Unsurprisingly Appeals Decision to Terminate CRISPR Patent Interference

In February, I reported the decision of the US Patent and Trademarks Office (USPTO) Patent Trial and Appeal Board (PTAB) in the patent interference proceedings initiated by the University of California (‘UC’) against the Broad Institute of MIT and Harvard (‘Broad’) in relation to CRISPR/Cas9 gene editing technology.  That decision was that there is ‘no interference in fact’, meaning that Broad’s development of the CRISPR/Cas9 system for use in eukaryotic cells (i.e. complex cells with, among other characteristics, distinct nuclei) was a non-obvious advance over UC’s development of the system for use in simpler prokaryotic cells (specifically, bacteria), and that there is thus scope for both parties to hold distinct patents.  At the time, I noted that the PTAB decision was subject to a possible appeal to a US Federal Court – most likely the specialised Court of Appeals for the Federal Circuit (CAFC) – and predicted that UC would file an appeal, in view of the substantial commercial interests at stake.

I am therefore not at all surprised to now be reporting that UC has indeed appealed to the CAFC.  In a press release announcing the appeal, UC has confirmed that it ‘seeks to have the PTAB reinstate the interference’, and quotes Edward Penhoet, a ‘special adviser on CRISPR to the UC president and UC Berkeley chancellor’ as saying that:

Ultimately, we expect to establish definitively that the team led by Jennifer Doudna and Emmanuelle Charpentier was the first to engineer CRISPR-Cas9 for use in all types of environments, including in non-cellular settings and within plant, animal and even human cells

Broad has responded with its own media statement saying, in relation to the appeal, that:

Given that the facts have not changed, we expect the outcome will once again be the same.
We are confident the Federal Circuit will affirm the PTAB decision and recognize the contribution of the Broad, MIT and Harvard in developing this transformative technology.

 Read full article ► 

Tags: Biotechnology, CRISPR, Genetic technology, Interference, US

New USPTO Data Set Reveals Recent Trends in Software and Business Method Patent Grants and Filings

The US Patent and Trademarks Office (USPTO) has released a new public patent data service, which it calls the Patent Examination Data System (PEDS).  PEDS is intended to replace the PAIR Bulk Data (PBD) service, and has a very similar interface for filtering, viewing and downloading bulk US patent data, as well as an application programming interface (API) for live access.  Although PEDS is still under development, is missing some data fields that are present in PBD, and currently provides fewer filtering options than PBD, it is already ahead in a number of important respects. 

Firstly, where I have previously noted that the PBD set was incomplete in relation to patents granted in 2016, this problem seems to have been resolved in PEDS.  Secondly, PEDS includes the ‘transaction history’ for each application in the data set.  Readers familiar with the USPTO’s Patent Application Information Retrieval (PAIR) online system will be aware that the PAIR interface includes a ‘Transaction History’ tab that displays a list of all actions and events that have taken place on the file, along with their corresponding dates.  This information is now included in PEDS.  The USPTO has indicated that, in future, PEDS may include enhancements to search additional fields, additional data from tabs in Public PAIR, and the Image File Wrapper (IFW).

The availability of this new, and more complete, data set has enabled me to revisit the analysis of software and business method patents that I reported back in January, with the benefit of more than a year of additional data.  As a result, I have been able to observe how the trends in patent grants have progressed since the end of 2015.  In short, there has been no further change.  The rate of grant of patents assigned to software Art Units within the USPTO continues to track – and even slightly exceed – the overall rate of grants across all technologies, while business method patent grants remain in the doldrums, flat-lining at the rate to which they fell shortly after the US Supreme Court’s Alice decision in June 2014.

The additional data has also enabled me to look at trends in filing behaviour, which may be indicative of how applicants have responded to Alice and the USPTO’s subsequent changes in examination practice and guidance as applied to software and business method patent applications.  Interestingly, this data indicates that the rate of applicants filing for patents in relation to ‘business method’ inventions has been in steady decline since June 2014, but that there has been an equally steady increase in the rate of filing of applications for software inventions.

 Read full article ► 

Tags: Business processes, Computer programs, Patent analytics, Patentable subject matter, PEDS, US

USPTO Board Terminates CRISPR Patent Interference

On Wednesday 15 February 2017, the US Patent and Trademarks Office (USPTO) Patent Trial and Appeal Board (PTAB) handed down its much-anticipated decision in the patent interference proceedings initiated by the University of California (‘UC’) against the Broad Institute of MIT and Harvard (‘Broad’) in relation to CRISPR/Cas9 gene editing technology.  That decision, in short, is that there is ‘no interference in fact’.  That is to say, the three judges making up the PTAB panel have determined that Broad’s development of the CRISPR/Cas9 system for use in eukaryotic cells (i.e. complex cells with, among other characteristics, distinct nuclei) was a non-obvious advance over UC’s development of the system for use in simpler prokaryotic cells (specifically, bacteria), and that there is thus scope for both parties to hold distinct patents.

In its full decision [PDF, 412kB], the PTAB summarises its findings as follows:

Broad has persuaded us that the parties claim patentably distinct subject matter, rebutting the presumption created by declaration of this interference. Broad provided sufficient evidence to show that its claims, which are all limited to CRISPR-Cas9 systems in a eukaryotic environment, are not drawn to the same invention as UC’s claims, which are all directed to CRISPR-Cas9 systems not restricted to any environment. Specifically, the evidence shows that the invention of such systems in eukaryotic cells would not have been obvious over the invention of CRISPR-Cas9 systems in any environment, including in prokaryotic cells or in vitro, because one of ordinary skill in the art would not have reasonably expected a CRISPR-Cas9 system to be successful in a eukaryotic environment. This evidence shows that the parties’ claims do not interfere. Accordingly, we terminate the interference.

This is a considerable win for Broad which, subject to a potential appeal, has for now delivered a fatal blow to UC’s hopes of invalidating a number of Broad’s CRISPR-related patents and applications.  Unsurprisingly, Broad has reacted to the decision by declaring its full agreement with the PTAB, while UC maintains its belief that the evidence is on its side.  The stock market also reacted quickly to the news, adding US$200 million to the value of the Broad-connected biotech company Editas Medicine Inc.

 Read full article ► 

Tags: Biotechnology, CRISPR, Genetic technology, Interference, US

The Importance of Continuing Professional Education (And of Not Lying About It!)

If you are the client of a patent attorney, you probably expect that your experienced (and, perhaps, expensive) professional adviser is keeping up-to-date with the latest developments in their chosen field. Indeed, in many professions some form of continuing professional education (CPE) – alternatively known as continuing professional development (CPD) – is not just an expectation, it is a mandatory requirement.

The Australian patent attorney and trade marks attorney professions are among those in which a mandatory CPE requirement exists.  Some outsiders might be surprised, however, to learn that this has only been the case since 1 July 2008, and that regular compliance audits of attorneys only commenced in 2011. It has therefore been just a little over five years that anybody has been monitoring the efforts of Australian attorneys to keep our skills and knowledge current and relevant.

The formal CPE requirements are fairly minimal, being just 10 hours per year in order to remain registered as a patent attorney or trade marks attorney only, or 15 hours for patent attorneys who wish to remain registered as both.  Even so, I am occasionally surprised to encounter attorneys who do not appear to be as familiar with recent developments that I would have expected.

I do not imagine that anyone who reads this blog regularly will be surprised to hear that I believe that CPE is incredibly important.  Since entering the profession as a trainee in 2002, I have been on a constant learning curve.  The Australian law has, of course, evolved over this time through legislative change and through interpretation and development by the courts.  Keeping abreast of developments in other major jurisdictions, including the US, Europe, and China, has also been vital, given that many Australian companies wish to pursue IP rights in key export markets.  And the patent attorney profession itself has changed considerably, with clients having an increasing expectation that their attorneys will have a sound understanding of their business strategies and objectives, and be able to tailor a IP strategy recommendation accordingly.

The reason I have been thinking about the importance of CPE is a story I read recently out of the US, about a Californian IP attorney who falsely claimed that he had completed his mandatory 25 hours of continuing legal education (CLE) – notably quite a bit more than is expected of Australian patent attorneys, but still not hugely onerous – when he had, in fact, completed none!  Which made me wonder, could it happen here?

 Read full article ► 

Tags: Australia, Patent attorney profession, Professional conduct, US

How the Fate of Software and Business Method Patents has Turned on USPTO Directors and the Courts

The ‘death of software patents’ in the US has been greatly exaggerated.  That is, so long as you exclude patents covering computer-implemented business/financial processes and schemes, which may well be, if not quite yet deceased, for the most part (about 75%, in fact) mortally wounded. 

But for those ideologues who are trying to convince themselves, and others, that software-implemented inventions are simply no longer validly patentable, I am afraid I have bad news.  I have analysed US Patent and Trademark Office (USPTO) data covering millions of patents issued over the past decade, which shows that patents covering computer-implemented inventions, outside the particular fields of ecommerce, business and finance, not only are not in any form of decline, but have never, at any time over the past decade, shown any significant difference in grant rate from the bulk of patents issued by the USPTO across all fields of technology.

Patent claims classified by the USPTO as relating to ecommerce, business methods and finance, are another matter.  The Supreme Court’s Alice decision, issued in June 2014, led to an immediate, dramatic and sustained fall in the number of patents being granted in these fields of endeavour.

Interestingly, the top US Court’s previous pertinent decision, Bilski (issued in June 2010, shortly after I started this blog), had no noticeable impact on the rate of grant of business method patents.  This is, perhaps, unsurprising given that Bilski was the result of an appeal against a rejection of the application at issue by the USPTO, which had already been upheld by the Court of Appeal for the Federal Circuit (CAFC).  Thus it did not represent, or require, any significant change in policy or practice at the Patent Office which the Supreme Court confirmed had been right to reject Bilski’s application.  To the extent that Bilski changed anything with regard to business method patents, it was following the CAFC decision, rather than that of the Supreme Court.

In fact, the last event prior to Alice that had a significant effect on rates of grant of business method patents was the 2009 transition from Jon Dudas to David Kappos as Under Secretary of Commerce for Intellectual Property and Director of the USPTO (via John Doll, who was acting in the role between Dudas’ resignation on 20 January and Kappos’ confirmation on 9 August).  Granting of business method patents had been in decline under Dudas, however this trend was soon reversed under Kappos, with issue of business method patents once again tracking rates across all technology areas by the first quarter of 2010.

My analysis also shows that the CAFC’s Bilski decision and the early months of the Kappos era are associated with an increase in the average word-count of independent claims in granted business method patents, and also in patents directed to other forms of computer-implemented invention, along with a significant jump in the average number of claims in issued business method patents.  These effects are almost certainly a result of changes in examination practice at the USPTO, likely influenced at least in part by Bilski.

 Read full article ► 

Tags: Business processes, Computer programs, Patent analytics, Patentable subject matter, US

CRISPR Patent Interference Hearing – How to Define an ‘Invention’ and Why It Matters

On 6 December 2016, and for the first time since the University of California (‘UC’) first sought to provoke interference proceedings over CRISPR/Cas9 gene editing technology in April 2015, the parties in dispute over just who has the rightful claim to inventorship appeared at an oral hearing before three judges of the US Patent and Trademark Office (USPTO) Patent Trial and Appeal Board (PTAB).  Remarkably, considering the complexity of the scientific, technical and legal issues involved, UC and opposing claimant the Broad Institute of MIT and Harvard (‘Broad’) each had just 20 minutes to present its arguments, plus an optional five minutes for rebuttal of the other side’s submissions.  According to a journalist present at the hearing, it was all over in 45 minutes total.

It is important to understand, however, that while the judges’ decision here (which is expected within about two-to-three months) could put an end to the interference proceedings at the PTAB, the hearing was not actually about the ultimate question of who was first to invent the CRISPR technology at issue.  It was more about what each party may, or may not, have actually ‘invented’, and whether there is even any interference to be decided.

For any readers coming across this story for the first time, you could go back and read all of my articles on the topic (and the many good sources of information linked therein).  However, the key points may be briefly summarised as follows:

1. UC Berkeley Professor of Chemistry Jennifer Doudna and her collaborator Emmanuelle Charpentier were the lead researchers on a team that, in around 2012, developed CRISPR/Cas9 – a biotechnology system consisting of an engineered RNA and a ‘cutting’ protein that can be used for highly-targeted gene editing;
2. a US patent application is pending (serial no. 13/842,859), which is based on the UC team’s work and a series of filings beginning in May 2012;
3. the UC team’s original work related to the discovery of the CRISPR system in relatively simple bacterial cells (examples of ‘prokaryotes’, or simple cells without distinct nuclei), but in January 2013 they were successful in applying the technology to human cells (examples of ‘eukaryotes’, or more complex cells with, among other characteristics, distinct nuclei);
4. roughly in parallel, a team led by Feng Zhang at the Broad reported similar success using CRISPR to edit human genes;
5. a number of US patent applications were filed, beginning in December 2012, based upon the Broad team’s work (i.e. more than six months later than Doudna’s earliest filing);
6. the Broad requested prioritised examination under the USPTO’s Track One program and, as a result, was awarded the first patent on the basic CRISPR technology – US Patent No. 8,697,359, ‘CRISPR-Cas systems and methods for altering expression of gene products’, issued on 15 April 2015.

The UC applications, and the earliest Broad applications, were filed under the ‘old’ US system, according to which the applicant entitled to receive a patent is the first one to invent the claimed subject matter.  This differs from the ‘first-to-file’ priority system that has long existed throughout the rest of the world, and in the US since 16 March 2013.  Under the first-to-invent system, the administrative procedure used to determine who should receive a patent when there are competing claims is called an ‘interference’.

Therefore, the UC parties suggested that the USPTO should institute interference proceedings, in order to determine who is really entitled to own the patent rights to the CRISPR/Cas9 technology, which it did on 11 January 2016.  However, the purpose of the recent hearing was not to determine who was the first inventor, but rather to decide exactly what is the invention at issue, and whether the interference should proceed any further at all.

 Read full article ► 

Tags: Biotechnology, CRISPR, Genetic technology, Interference, US

Does Australia Have a (US-Style) Two-Step Test for Patent-Eligibility?

In its Mayo/Myriad/Alice series of cases, the US Supreme Court has established a two-step test in order to determine whether a claimed invention defines patent-eligible subject matter or not.  In the first step, the claims are examined to determine whether they are ‘directed to’ a patent-ineligible concept, i.e. an abstract idea, law of nature or natural phenomenon.  If not, then the subject matter of the invention is eligible for patenting.  Otherwise, the analysis proceeds to step two, in which the claims are further analysed to determine whether or not they comprise some additional element, or combination of elements, that is ‘sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.’

In contentious cases the focus has generally fallen upon the second step of the analysis.  This is not surprising, considering that the reason these cases are contentious in the first place is because they are typically those in which the claims appear on their face to encompass ineligible subject matter, e.g. abstract ideas in the case of computer-implemented inventions such as in Alice, or natural phenomena such as the isolated DNA in Myriad or the presence of metabolites in blood samples in Mayo.  It might be said in such cases that ‘the vibe’ of the claim is that it looks like it might be ineligible, and that it is therefore necessary to proceed to step two in order to determine whether or not this initial impression is correct.

However, two recent decisions of the US Court of Appeals for the Federal Circuit (CAFC) confirm that the first step of the Mayo/Myriad/Alice framework is not merely a formality, but must be given proper consideration.  Enfish, LLC v. Microsoft Corp. (Fed. Cir. 2016) [PDF, 605kB] concerned software-implemented methods and systems operating on a new and more efficient database format.  The court found at the first step of the Alice analysis that the claims were not directed to an abstract idea, on the basis that ‘[s]oftware can make non-abstract improvements to computer technology just as hardware improvements can’ and that it is ‘relevant to ask whether the claims are directed to an improvement to computer functionality versus being directed to an abstract idea’.  In McRO, Inc. v. Bandai Namco Games America Inc. (Fed. Cir. 2016) [PDF, 341kB] the court found that claims directed to generating automated lip-synchronization and associated facial expressions for 3D animated characters (e.g. in video games) were, similarly, not abstract, and patent-eligible at the first step of the test.

It should not come as any great surprise that the first step of the Alice framework actually has some teeth.  The test is supposed to apply to patent claims in all fields of technology, and clearly there are very many patents and applications that relate to wholly uncontentious subject matter for which patent-eligibility is barely a consideration.  In all such cases, the claims are effectively passing at the first step of the test.  The surprise, for many, is that the CAFC has finally started to recognise and apply this reality in relation to computer-implemented inventions.

This raises the question of whether there is an analogous process that takes place in Australia.  As a practical matter, I believe that there is, however it has not been explicitly set out by the courts, and it remains an unacknowledged aspect of examining patent claims for eligibility.  This is unfortunate, because the existence of an implicit step in the eligibility analysis is an obstacle to consistency and objectivity in the assessment of patent claims.

 Read full article ► 

Tags: Australia, Business processes, Computer programs, Genetic technology, Patentable subject matter, US

After US Loss, Sequenom Takes Its Patent Battle With Ariosa Down-Under

One of the many benefits of genetic testing is the ability to carry out prenatal diagnosis of genetic disorders, most notably including (but certainly not limited to) Downs Syndrome.  This can be particularly valuable when one or both parents are known to be carriers of a genetic mutation such that the baby may be at significant risk of developing a serious condition or abnormality.  The conventional method of obtaining foetal DNA in order to conduct such tests is via amniocentesis, which is an invasive procedure in which a small amount of amniotic fluid is sampled from the amniotic sac surrounding the developing foetus using a needle.  Unfortunately, amniocentesis presents a risk to both foetus and mother.

A test that would enable screening of foetal DNA in a noninvasive manner would therefore be an important breakthrough.  Fortunately, just such a breakthrough was made in 1997 at Oxford University, when researchers Stephen Wainscoat and Dennis Lo discovered the presence of cell-free foetal DNA (cffDNA) in maternal blood serum, and developed techniques to isolate this DNA for testing.  Their discovery led to the grant of patents in a number of countries, including US patent no. 6,258,540 and Australian patent no. 727,919.  Oxford University, through its commercialisation arm Isis Innovation (now renamed as Oxford Innovation, for sadly obvious reasons), licensed the technology exclusively to US company Sequenom, Inc.

Last year, the US Court of Appeals for the Federal Circuit (CAFC) found the US patent to be invalid on the basis that the claimed invention was essentially the discovery of the pre-existing, but hitherto unknown, natural phenomenon of cffDNA being present in maternal blood: Ariosa Diagnostics, Inc.v. Sequenom, Inc. (Fed. Cir. 2015).  The claims were therefore considered to be directed to ineligible subject matter under the standards established by the US Supreme Court in its Myriad and Mayo decisions.  The CAFC subsequently declined to rehear the case en banc.  However a number of the Federal Circuit judges, including Judge Linn on the original panel, and Judges Lourie and Dyk in the decision refusing en banc rehearing, indicated that they felt bound by the Supreme Court precedents, but did not agree with the result in this case.  Judge Newman went further, stating her view that the case had been wrongly decided, and was distinguishable from the facts in Myriad and Mayo.

Many observers therefore felt that the Sequenom case was ripe for review by the Supreme Court, which would then have an opportunity to further develop and clarify its Myriad and Mayo guidance.  However, on 27 June 2016 the Supreme Court denied Sequenom’s petition, sealing the US patent’s demise once and for all.

However, in the meantime (on 7 June 2016) Sequenom has commenced proceedings in the Federal Court of Australia, also against Ariosa Diagnostics, Inc, for infringement of the equivalent Australian patent.  This raises the question of whether the invention that was found ineligible for patent protection in the US may nonetheless be upheld under Australian law.  This will be the second time in recent history (the other being the Myriad BRCA breast cancer gene case) that subject-matter eligibility has been considered for corresponding patents in the US and Australia.

 Read full article ► 

Tags: Australia, Biotechnology, Diagnostic methods, Litigation, Patentable subject matter, US

Be a USPTO Patent ‘Examiner Ninja’

If you have any involvement or interest in the prosecution of US patent applications – particularly in the contested fields of computer-implemented inventions or biotechnology – you will probably be aware that disturbing things are afoot at the US Patent and Trademark Office (USPTO).  Specifically, in the wake of the US Supreme Court’s decisions in the Alice, Mayo and Myriad cases, patent allowance rates have plummeted in examination sections devoted to subject matter that could be regarded as relating to computer-implemented ‘business’ processes, diagnostic methods, and genetic technologies.

In this hostile environment, applicants and their advisers need every tool they can get their hands on to understand what they are up against, and to create the best possible strategies for staying out of – or, if necessary, getting out of – trouble.  And, as in many other fields of endeavour, so-called ‘big data’ is being touted as a possible solution. 

In particular, the contents of the USPTO’s Patent Application Information Retrieval (PAIR) database, which records all information about every patent application making its way through the office procedures, are increasingly accessible to anyone wants to use that data, whether for commercial or non-commercial purposes.  PAIR Bulk Data is now available directly from the USPTO, and includes the information included in the bibliographic (‘application data’), published document and patent term extension data tabs in Public PAIR dating back to 1981.  Additional examination information for many recent applications is available in the USPTO’s Patent Examination Research Dataset (PatEx).  Up until 2015, Google maintained bulk-downloadable USPTO PAIR data sets.

All of this information can be used to obtain and analyse a variety of statistics.  For example, if you are dealing with a ‘difficult’ examiner it is possible to find out whether it is just your case that is problematic, or if the examiner has a history of rejecting a majority of applications he or she has reviewed.  The data might also tell you whether the examiner is more likely to allow an application following an interview and/or whether filing a Notice of Appeal may lead to a more favourable outcome.

Of course, all of the sources I have listed above supply ‘raw’ data, in such exciting formats as CSV, XML and JSON, which is of limited use unless you have the time, and the technical skills, to convert it into a form that is more suitable for analysis.  Fortunately, there are people out there who are already doing this for us all.  Commercial offerings include LexisNexis PatentAdvisor and Juristat, while free services are provided by Examiner Watchdog and Examiner Ninja.  So I am going to provide a quick review of these services, and what they can do for you.

 Read full article ► 

Tags: Examination, Patent analytics, Patent Office, US

Patentable Subject Matter Continues to Confound in the US Despite Hopeful Signs

The past couple of weeks have brought some slightly brighter news for innovators in life sciences and software fields seeking patent protection in the United States.  First, the US Patent and Trademark Office (USPTO) issued an update to its Interim Guidance on Subject Matter Eligibility which provides some much needed clarification on what is expected from examiners, as well as additional examples which will give new hope to applicants with inventions relating to diagnostic methods.  Second, the US Court of Appeals for the Federal Circuit (CAFC) issued a rare decision (Enfish LLC v Microsoft Corporation, appeal no. 15-1244 [PDF, 604kB]) finding that a computer-implemented invention is not ‘abstract’, and is therefore patent-eligible.

The USPTO’s updated guidelines require examiners to provide more detail in their rejections, to provide distinct rejections for every claim, and to provide more reasoning when maintaining rejections in the fact of applicant arguments.  They also prohibit examiners from expanding the scope of unpatentable subject matter beyond the specific examples provided by court rulings.  These clarifications will hopefully create greater certainty and consistency in the approach taken by examiners across all fields in which subject matter eligibility is commonly at issue.

The new life sciences eligibility examples will also be welcomed, especially by applicants with inventions in the field of diagnostics.  At the same time, however, at least one of those examples also serves to highlight just how absurd the approach to subject matter eligibility has become in this area, thanks in large part to the US Supreme Court tying itself in knots trying to establish a consistent approach, while at the same time avoiding setting down any hard and fast rules about identifying excluded subject matter within the established categories of ‘abstract ideas’, ‘laws of nature’ and ‘mental steps’.

Interestingly, the USPTO’s ‘diagnostic’ example, and the patent-eligible computer-implemented invention in Enfish have something in common – both demonstrate that the most effective way to avoid a finding of ineligibility is to bypass the eligibility analysis altogether, by ensuring that the patent claims are not ‘directed to’ (i.e. ‘recite or describe’) any recognised judicial exception, such as a law of nature or abstract idea.

 Read full article ► 

Tags: Biotechnology, Computer programs, Patentable subject matter, US

CRISPR Patent Dispute – Is It Just Too Big to Settle?

The proceedings at the US Patent and Trademark Office (USPTO) Patent Trial and Appeal Board (PTAB), to determine who is entitled to foundational patent rights relating to CRISPR/Cas9 ‘gene editing’ technology, have been steadily progressing since my last update back in January.  As a reminder, the parties vying for ownership of these rights are a group led by Berkeley Professor of Chemistry Jennifer Doudna and her collaborator Emmanuelle Charpentier, and a group led by Feng Zhang at the Broad Institute, Inc and MIT.  Although a little reductive, it is convenient for me to refer to these two groups as ‘team Doudna’ and ‘team Zhang’ respectively. 

In a very recent development, on 11 April 2016, the ‘senior party’ in the proceedings (team Doudna) filed a notice stating that ‘in accordance with Standing Order ¶ 126, Senior Party hereby notifies the Board that the parties have discussed settlement, and have made a good faith effort to settle the interference, but no agreement has been reached at this time.’  It was necessary for the notice to be filed on or before this date, because the PTAB encourages parties to settle priority disputes between themselves where possible, and the referenced paragraph of the Standing Order in fact makes it compulsory for settlement discussions to be initiated by the ‘last named party’ (which, again, happens to be team Doudna in this case) within three months of an interference being declared.  The CRISPR interference was declared on 11 January 2016.

Interestingly, however, when the PTAB judges raised the matter of settlement discussions during a telephone conference on 10 March 2016, counsel for team Zhang stated that ‘we have not had that opportunity one way or the other to discuss settlement’ while counsel for team Doudna confirmed his understanding that ‘there has not been any formal discussions between the parties’.

So up until two months after the interference was officially declared there had been no discussions about a possible settlement.  Then, during the final month of the period for commencing mandatory discussions, suddenly ‘a good faith effort’ was made to settle the dispute, but no agreement was reached.  Pardon my cynicism, but if you believe that the timing of these events reflects a genuine effort at settlement, then perhaps I can interest you in the purchase of a nice bridge!  On the contrary, it seems pretty clear that at least team Doudna (whose obligation it was to initiate mandatory settlement discussions, and file the notice) has no desire to settle the interference.  In fact, it is quite likely that neither party has any real interest in settlement.

Although I have previously expressed the opinion that a settlement agreement may provide a better outcome for all concerned, I no longer believe that this is a viable option.  I now think it likely that the technology is just too valuable for either party to give ground, particularly at this early stage.  In all likelihood, these interference proceedings are going to run their full course.  Yes, they will be incredibly expensive, but the cost is just a drop in the ocean compared to what is at stake in the main game of commercialising CRISPR/Cas9 technology.

 Read full article ► 

Tags: Biotechnology, Commercialisation, CRISPR, Genetic technology, Interference, US

How to Patent Your Invention in Australia and the US

For many of the Australian clients I work with, the most important markets are Australia (i.e. the ‘home’ market) and the US (because of its size and relative accessibility).  This means that when it comes to protecting their innovative technologies, obtaining patents in these two countries is at the top of these clients’ lists of priorities.  I am therefore often asked how best to achieve this objective, how much it will cost, and how long it will take.

The typical ‘lawyer’ answer is, of course, ‘it depends’!  Do you want patents only in Australia and the US, or are there other countries of interest?  When and why do you require these patents?  Do you want to obtain patents as quickly as possible, or are there strategic advantages in drawing out the pendency (and finalisation of the scope of rights) for as long as possible?  What is your budget for the patenting program, both in the short term and over the coming years?

Assuming that you are able to answer these questions, it should be possible to develop a strategy that meets all of your requirements.  In this article I will go into further detail of one fairly typical and effective approach, along with some of the relevant considerations and potential variations.

 Read full article ► 

Tags: Australia, Examination, Paris Convention, Patent filing, PCT, PPH, Strategy, US

US Federal Circuit Maintains the Status Quo on International Patent Exhaustion (and Mentions Australia)

Back in November 2015 I wrote on the topic of ‘international patent exhaustion’ in anticipation of a decision by the US Court of Appeals for the Federal Circuit (CAFC) in the case of Lexmark v Impression Products.  In doing so, I expressed my hope that the court would uphold the existing position, established by its own precedent in Jazz Photo Corp. v. International Trade Commission 264 F.3d 1094 (Fed. Cir. 2001) that foreign sales do not exhaust US patent rights. 

The CAFC has now issued its decision in the case [PDF, 612kB] and has, by a 10-2 majority, affirmed Jazz Photo, maintaining the established position that US patent rights are not exhausted by a foreign sale.  In the absence of a valid defence (more on which later) it is therefore an infringement to import a patented product into the US even if it is a genuine product manufactured and sold by, or with the authority of, the patentee in a foreign country.  The minority would not have categorically overturned Jazz Photo, insofar as it holds that a foreign sale does not in all circumstances exhaust US patent rights.  In their view, a foreign sale should result in exhaustion unless an authorised seller explicitly reserves the US patent rights.

My primary reason for supporting the status quo is that I believe it is, on balance, beneficial for innovative companies to be able to use patent rights to maintain price disparities in different markets.  The fact is that those of us fortunate enough to live in developed nations have, on average, higher incomes, higher living standards, and a greater ability to fund innovation via the prices we pay for goods and services than people in developing nations. 

If patent rights in a country such as the US are exhausted by the sale of a product in, say, India or Kenya, the only effective option left open to patentees will be to charge similar prices globally.  Clearly, the more that new technologies (including innovations in food production and health care) can be made available at affordable prices to developing nations, the more rapidly they will be able to advance.  (Obviously, development is much more complex than this, but intellectual property laws are one piece in the overall puzzle, and it is desirable that they make a positive, rather than negative, contribution.)

 Read full article ► 

Tags: Australia, Exhaustion, Patent law, US