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Patentable Subject Matter : 

Patentable Subject Matter Software Related Inventions Patent and Trade Secrets Law James Longwell Lawyer, Patent and Trade-mark Agent Toronto January 20, 2005

Introduction : 

Introduction United States – the fundamental issue has shifted from “What is patentable?” to “What is the best way to protect the invention?” Europe and to a lesser degree in Canada – we still struggle with “What is patentable?”

United States: 

United States Patentability of software and business methods has been resolved for years Software and business method inventions are patentable when they produce a “real, concrete, and tangible result” State Street Financial v. Signature Financial Group Inc.

Europe: 

Europe Inventions require industrial applicability, novelty, an inventive step, and a “technical character” Specific exemptions to patentability relate to computer programs and business methods The European Patent Office (“EPO”) has determined that certain computer-implemented inventions are patentable but has stopped short on business methods

Europe: 

Europe EPO’s decisions are controversial Courts of Member States enforce the patents but have interpreted the patent laws differently European Commission has undertaken a number of initiatives to reform the patent law

Europe: 

Europe European Commission – Proposed Directive intended to clarify and codify patent law generally in accordance with EPO practice Reaction to the Proposed Directive from the Open Source Community and others resulted in an amended Directive so diverged from its underlying policy it is unlikely to proceed

Canada – Statutory Definition : 

Canada – Statutory Definition Must be an “Invention” under the Patent Act “Invention” means any new and useful art, process, machine, manufacture or composition of matter … (s.2) No patent shall be granted for any mere scientific principle or abstract theorem (Sub-s. 27(8))

Other indicia of patentability: 

Other indicia of patentability Is there a change of state of matter? Is there a vendible product?

Canada – Case Law: 

Canada – Case Law Shell Oil Co. v. Commissioner of Patents (1982) 67 C.P.R. (2d) 1 (S.C.C) “art” is a word of very wide connotation and not to be confined … but extended to new and innovative methods of applying skill or knowledge provided they produce effects or results commercially useful to the public

GATT/TRIPS: 

GATT/TRIPS Make patents available for “any inventions … in all fields of technology” (Article 27(1)) Can’t discriminate against technologies (except biotech)

Software Patents: 

Software Patents

The Common Principles: 

The Common Principles You can’t patent math or science You can patent applied science Where’s the dividing line?

Where’s the dividing line? : 

Where’s the dividing line? Hardware (signal processing, control systems)

Where’s the dividing line? : 

Where’s the dividing line? Hardware Software control system

Computer as control system : 

Computer as control system Pre solution activity Post solution activity computer

?: 

? computer

U.S.A. : 

U.S.A. 1996 Guidelines

U.S.A.: 

U.S.A. AT&T v. Excel Communications method of processing long distance carrier data was patentable does the number crunching produce a useful, concrete and tangible result

Computer program products are patentable in Other Jurisdictions: 

Computer program products are patentable in Other Jurisdictions U.S.A. Beauregard inventive program on a disk Japan as of April 1, 1997 you can get Beauregard claims Europe 1999 IBM decisions

Canada: 

Canada Schlumberger Canada Ltd. v. Commissioner of Patents (1981), 56 C.P.R (2d) 204 (FCA) computer analysis of seismic data on soil characteristics for oil and gas exploration not patentable: “mere scientific principle or abstract theorem”

Canada : 

Canada Schlumberger Canada Ltd. v. Commissioner of Patents “What the appellant claims as an invention here is merely the discovery that by making certain calculations according to certain formulae, useful information could be extracted from certain measurements. This is not, in my view, an invention within the meaning of s.2”

Canada: 

Canada Schlumberger test: 1. What has been discovered? 2. Is it patentable regardless of whether a computer is used?

Canada: 

Canada The 1994 CIPO Guidelines: 1. Unapplied mathematical formulae are not patentable 2. Computer programs neither add to nor subtract from patentability 3. Computer program integrated with traditional subject matter is patentable

Canada: 

Canada The Motorola decisions – Nov. 3, 1998: 86 C.P.R. (3d) 76 Output = bx Where x is input

Canada: 

The Motorola decisions – Nov. 3, 1998: 86 C.P.R. (3d) 76 Where x is input Canada X J

Canada: 

Canada The Motorola decisions – Nov. 3, 1998: PAB: There is a specific piece of computer hardware: “(C) read-only memory (ROM) coupled to the modification means for determining the first exponential value having the predetermined base;”

Where’s the dividing line? : 

Where’s the dividing line? Hardware Software control system software

Data Structures: 

Data Structures

Data Structures : 

Data Structures Represent a physical implementation of a data model for organizing and representing information which is used by a computer program The physical organization is responsive to the attributes of the data rather than specific content E.g. MP3, customer database, or DVD data structure: organized and linked compressed video data portions having an indexing system or interface such as chapters, pointers, etc. to access particular portions of the video;

Data Structures - U.S.A. : 

Data Structures - U.S.A. In re Lowry (1994) data structure of database was patentable dictated how application programs managed information; allowed the computer to operate more efficiently

Data Structures - Canada : 

Data Structures - Canada No case law CIPO Guidelines support patentability Claimed as a product

Where’s the dividing line? : 

Where’s the dividing line? Hardware Software control system software data structure

Methods of Doing Business: 

Methods of Doing Business

Business Methods – U.S.A.: 

Business Methods – U.S.A. State Street Bank v. Signature Financial data processing system for administering mutual funds hub and spoke method calculated final share price = useful, concrete & tangible result was patentable there is no “business methods” exemption

Methods of Doing Business - Europe: 

Methods of Doing Business - Europe Per se, not patentable Point of invention requires technical character If the invention relates to a new or improved manner of conducting business, not technical so not patentable If the invention can be characterized as having technical character and makes a technical contribution – improved processing technique for example, then may be patentable

Canada: 

Canada Progressive Games, Inc. v. Canada (Comm. Patents) (2000) 9 C.P.R. (4th) 479 (F.C.A.) affirming (1999) 3 C.P.R. (4th) 517 (F.C.T.D.) Method of playing poker Is shuffling cards an “art”? Shell Oil Co. v. Commissioner of Patents

Approach of the Canadian Intellectual Property Office: 

Approach of the Canadian Intellectual Property Office Re: Application 564,175 to Atkins, Sep. 1999, (Comm. Patents) Post Motorola Applicant substitutes a computer programmed in a specific manner to make decisions which were formerly made by a financial advisor - professional skill An operation which is not patentable when carried out by an individual cannot be made patentable merely by having it carried out by a computer

Approach of the Canadian Intellectual Property Office: 

Approach of the Canadian Intellectual Property Office Re Patent App. No. 2,203,302, Dec. 9, 2004 (Comm. of Patents) – Rankin Research Corp. Vehicle tracking system using a cellular network to track a stolen vehicle. Rejected by Examiner for requiring human intervention PAB concludes human intervention limited to steps which are of a routine nature and do not require a high degree of training, judgment and decision making are permissible

Approach of the Canadian Intellectual Property Office: 

Approach of the Canadian Intellectual Property Office Business Method Patents in Canada (IPC G06F 17/60) Examiners are allowing computer-implemented business method cases with method-type claims: Patent Number 2280476 : Portfolio Structuring Using Low-discrepancy Deterministic Sequences

Approach of the Canadian Intellectual Property Office: 

Approach of the Canadian Intellectual Property Office Business Method Patents in Canada (IPC G06F 17/60) Patent Number 2186113 : Computer System and Method for Determining a Travel Scheme Minimizing Travel Costs for an Organization Patent Number 2273971 : In-store Points Redemption System and Method

Where’s the dividing line? : 

Where’s the dividing line? Hardware Software control system software data structure Business methods

Proposed MOPOP Guidelines: 

Proposed MOPOP Guidelines Part of larger Manual of patent Office Practice (MOPOP) amendment initiative to conclude by September 2004 Guidelines – re-draft Chapter 12: Utility and Subject Matter; and Chapter 16: Computer-Implemented Inventions

Proposed MOPOP Guidelines: 

Proposed MOPOP Guidelines Moving in right direction to make guidelines and office practise more transparent Remains a concern among the profession that non-statutory subject matter is too broadly defined and will be used to exclude proper inventions

Proposed MOPOP Guidelines: 

Proposed MOPOP Guidelines Introduce claim categories with examples Section 2 – Three categories of claims possible for computer implemented inventions: (i) process (method) claims (ii) machine (apparatus and systems) claims (iii) manufacture or device (computer media including signal and data structure) claims U.S.-style Beauregard and Lowry-type claims and propagated signal claims accepted as per current practice Patent Number 2286935 : Translation System

Proposed MOPOP Guidelines: 

Proposed MOPOP Guidelines Guidelines do not have the force of law “This manual is to be considered solely as a guide, and should not be quoted as an authority. Authority must be found in the Patent Act, the Patent Rules, and in decisions of the Courts interpreting them”

Other Implications: 

Other Implications Consider location of system parts, providers and users Where will infringement occur? NTP v. RIM (Dec. 14. 2004) (C.A.F.C.) System located abroad, Court finds infringement in U.S. Freedom Wireless, Inc. v. Boston Communications Group, Inc., 198 F.Supp 2d 11 (D. Mass) 20 System billing database located in U.S. but “controlled” from Canada, Court finds no infringement in U.S. by Rogers Menashe Business Mercantile Ltd. et al. v. William Hill Organization Ltd. [2002] EWCA Civ 1702 System located abroad, Court finds infringement in U.K.

Patentable Subject Matter : 

Patentable Subject Matter Software Related Inventions Patent and Trade Secrets Law James Longwell Lawyer, Patent and Trade-mark Agent Toronto January 20, 2005

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