Quick IP Related Stories from the Economist

There were a few IP-related stories in this week’s Economist:

Innovation in Asia: Trading Places – How China is about to overtake Japan in patent applications.

Financing Small Business: The Mother of Invention – Innovative new funding models step in when the banks retreat (see http://www.fundingcircle.com/).

Books and arts: Well, what a good idea! – The release of two interesting books on innovation.

“Software” Patents in Europe

Well, to be precise, computer-implemented inventions under the European Patent Convention.

The Enlarged Board of Appeal has just issued a decision in referral G03/08 (for background see here). The Enlarged Board have decided that the referral is inadmissible. The accompanying opinion states that previous decisions of the Boards of Appeal are not sufficiently “different” (i.e. “conflicted”) to warrant clarification from the higher Enlarged Board.

Better men than I have summarised the decision here:

http://www.ipjur.com/blog2/index.php?/archives/150-EPO-EBoA-Opinion-in-re-G-0308-Patentability-Of-Computer-Implemented-Inventions.html

http://ipkitten.blogspot.com/2010/05/g-308-software-patents-decision-is-out.html

[Update] and here: http://www.iam-magazine.com/blog/Detail.aspx?g=cc296bce-5de8-484c-ac43-95d5b6ce68df featuring Gill Jennings & Every‘s Peter Finnie

To be honest, the decision was pretty much expected: the European Patent Office (EPO) has been taking a fairly consistent approach to computer-implemented inventions and has a growing body of learning materials on the subject. In fact, by no small coincidence, the book “Patent Law for Computer Scientists“, written by EPO Patent Examiners was released a few days ago. I have ordered a copy and will let you know if it is of any use. A review can be found here.

However, the opinion is not without merit. Its 60-odd pages set out the current state of the law on the issue and may provide a useful caselaw summary. I will attempt to read through the pages of dense courier font shortly.

Time Limits & Volcanic Ash (R.134 EPC)

The European Patent Office has declared a dislocation in the delivery of mail from 15 to 28 April 2010.

As the dislocation affected inter alia Germany and the Netherlands, time limits to be observed vis-à-vis the EPO, which would have expired in the period from 15 to 28 April 2010, have been extended to 29 April 2010 (see Rule 134(2) EPC).

As far as time limits under the PCT are concerned, applicants are referred to Rule 82 PCT. This provision, however, does not apply to the priority period. If an international application was received at the EPO after expiry of the priority period, restoration of the right of priority may be available (Rule 26bis.3 PCT).

Short Thoughts: HP, Palm and IP

Just read the news that Hewlett Packard (HP) has bought Palm for a rumoured $1.2 billion.

Even though this seems like a lot of money I think HP has snagged a bit of a bargain. Recent Palm shares were trading at 30% of their 52-week-high value, following the relatively meagre sales performance of the Palm Pre.

It also seems a shrewd strategic move with regard to intellectual property (IP). Palm likely has an extensive patent portfolio covering touch screen technologies and mobile devices, areas into which HP has recently moved. Considering Apple’s recent assault on HTC the acquisition of Palm will naturally beef-up HP’s portfolio allowing a more aggressive defensive or counter-claim if Apple come a-knocking.

A strong patent-portfolio will become important if HP looks to use webOS on the Slate and go head-to-head with Apple’s iPad.

Can software be patented?

Can software be patented? If so, in what form?

This post provides some general background on the issue and briefly considers two pending cases in Europe and the US.

The patentability of software has important consequences for the way in which individuals and businesses protect, and make money from, their creations under the law.

Nearly all modern inventions make use of a computer, whether in their design, construction or operation. The Internet is simply a network of computers.

On one side of the debate are those calling for the abolition of patents for software; on the other side are those calling for clearer protection.

Quick Crib Sheet

A patent is a property right granted by a state which allows its holder to prevent third parties from commercially exploiting an invention for a set period of time.

The enforcement of a patent is governed by national law.  The procedure for obtaining a patent is governed by at least one of national law (e.g. the UK Patents Act), regional treaty (e.g. The European Patent Convention) and international treaty (e.g. The Patent Cooperation Treaty).

The era of revolution, both industrial and political, gave birth to substantive patent law.  Modern patent law was codified in the post-war period.  British, European and international codes were drawn up in the 1970s.

Since the 1970s, the growth in computing has been exponential.

From this:

Computer - 1970s c/o Ecksemmess

to this:

iPhone c/o Masaaki Komori from Tokyo, Japan

Under British and European patent law, a patent cannot be granted for “business methods” or “computer programs” “as such”.  However, certain inventions may be patented as “computer-implemented inventions” (CIIs).  The law in the UK and Europe should be harmonised but in practice differs on points of interpretation.  This prompted Lord Justice Jacob, in the Court of Appeal, to ask the European Patent Office for clarification in 2006.  The European Patent Office refused the request.

In the US, case law developed at the turn of the last century was used to demonstrate a “business method” exclusion for patents.  This changed in the late 1990s when, under pressure from the dot-com boom, the US Patent Office began to grant patents for “business methods” implemented using a computer.  The explosion of such patents, which were considered by some to be of “potential vagueness and suspect validity”, has recently seen a legal backlash.

Cases:

Europe:

Points of law are considered by the Enlarged Board of Appeal.  On the 22 October 2008 the (British) President of the European Patent Office referred a series of questions to the Board.  These questions were formulated to seek an answer to the question above and provide guidance for national harmonisation.  The Board may dismiss the referral.

The referral was rigorously debated by the high-tech community.  Amicus curiae briefs were filed by many well-known companies, including Apple, IBM, and Philips, as well as by groups such as the Foundation for a Free Information Infrastructure and the Pirate Party.

US

The US Supreme Court is presently considering a case concerning a 1997 patent application filed by Bernard Bilski on a business method for hedging financial trades (known generally as “Bilski”).  The application was rejected by the U.S. Patent Office and this decision was upheld by the Federal Circuit Court.  As in Europe, the case has ignited fierce debate; amicus curiae briefs have been filed on behalf of, for example, Microsoft, Google, and Bank of America, as well as associations both for and against patents for software.

Digital Economy Bill

I attended an interesting talk hosted by Queen Mary Intellectual Property Research Institute (QMIPRI) and the Institute of Computer and Communications Law on the Digital Economy Bill last night.

Speaking were Richard Mollet of British Phonographic Industry (BPI) and Jim Killock of Open Rights Group (ORG), with Graham Smith of Bird & Bird offering an introduction to the debate.

The Digital Economy Bill has just been through the House of Lords (in the UK) where a number of amendments were proposed. It is due to enter the House of Commons for debate with MPs shortly.

I have to admit I am not familiar with the details of the Bill  (a summary is provided at the above link). There are Notification Provisions which concern ISPs matching subscriber details to IP (internet protocol) addresses supplied in the form of Infringement Reports from the rights holders. ISPs may also have to notify rights holders of persistent infringers.  The more controversial measures of “suspension/disconnection” are set out in the Technical Measures section of the Bill. Many articles on the Net refer to a “three strikes” policy – interestingly this does not appear to be in the Bill (please correct me if I am wrong) but will be in the implementation details.

While not trying to excuse my own ignorance, a lack of clear information surrounding the provisions of the Bill may be a cause of some of the debate; Richard Mollet stated that at times it appeared the BPI and ORG were looking at different Bills: this could be explained by each party having a different intepretation of the Bill’s wording. Many of the implementational details of the Bill are designed to be implemented by secondary legislation (i.e. not defined in the wording of the law).The reasoning behind this is that technology moves faster than the law, so the law needs to be flexible enough to adapt. However, it does lead to ambiguity – both parties may be correct in their interpretation depending on how the Bill is implemented. My personal view is that secondary legislation is, unfortunately, one of the only practical ways to keep up with technology changes, but that safeguards have to be encoded in the Bill to prevent abuse. Richard Mollet referred in his presentation to “the aims of the Bill” and “what the Bill is designed to do”; however, he may underestimate the ability of a less benign government to exploit ambiguous legislation for their own ends.

To be fair to both parties, they each had valid points. Condensed:

  • BPI: Infringement (i.e. illegal copying of copyright material) is taking place and is harming sales. The industry (and I believe this is not necessarily appreciated by many in the opposite party) has tried hard to combat piracy through multiple “soft” initiatives such as discussions with ISPs. However, infringement (and the losses) are still occurring.
  • ORG: The Bill gives too much power to authorities to disconnect households and organisations from the Internet. It is also worried about the effect on “free” or municipal wifi. They also raised valid points that the Bill needed debate and/or revision.

However, both parties also disminished their case through their polemic:

  • BPI: At times Richard Mollet carried an air of indignant entitlement: the world is doing something wrong and stealing our material, they should stop and someone should stop them, and not necessarily considering the deeper issues. Psychologically and physically there is a difference between digital goods and real-world goods; the BPI tends to ignore this difference but for any law to be enforceable it needs to match how we see, produce and interact with goods. DRM has not been successful because it restricts people’s expectations of use (I had to pay Apple £100 to get DRM-free copies of my purchased music to play the music on a Linux PC). However, the Apple App Store and DRM-free digital singles have been successful and profitable. The law only be used as a last resort when a change in industry and business cannot work.
  • ORG: The argument that the Internet is a fundamental human right for me fell a little flat, a little indulgent and middle-class, like insisting that a Waitrose within 5 miles is a human right. While it is important, equating it with water stretches the argument thinly. Also I think ORG is maybe too commercially naive, money needs to be made from copyrighted content to support the creators and their entourage, hence something needs to be done to reduce illegal copying (or at least monetise it). However, the tortured tale of Napster shows us this is far from easy.

I do sympathise with the BPI a little, comment in the press and on the Internet and “blogosphere” has a distinct anti-commercial tone. This makes necessary balanced debate difficult. The former “comment” often has a hint of student or dinner-table debate, underestimating the compromises and Realpolitik necessary in successful commercial enterprise.

In summary, both parties are needed for successful and balanced legislation and a compromise does seem possible – encoding the three strikes policy in statute, replacing disconnection with fines, supplying safeguards for municipal wifi. However, whether there will be time for debate in parliment is another question. Is a poorly drafted Bill better than no law?

Some links:

Panorama

Guardian News Report (the most recent online news article – choice of paper is not intentional)

Google “location-based” advertising patent

Another day, another fluster online about a US patent granted to a well-known company.

This time the company is Google and the patent (7,668,832) is directed towards “controlling serving of an ad using its relevancy to a request” using “geolocation information“.

How NOT to interpret a recently granted patent (as demonstrated by most web-related news sites):

  1. Don’t refer to the claims of the patent in the news article, even though these define the scope of legal protection.
  2. Perhaps instead quote a section from the “Field of Invention” or “Background of Invention” sections (these sections respectively locating the patent subject-matter in a technology field and broadly describing what has been before – neither section gets to the heart of the invention).  Quoting from the “Background of Invention” is particularly favoured as this section is typically drafted broadly and typically is of the least relevance to the claimed invention.
  3. If you do locate the claims of the patent, summarise their subject-matter in a single sentence (even though they may in practice comprise several paragraphs of essential features), e.g. “patent on location-based ads” – wherein the independent claims actually require at least: –
  4. A computer-implemented method for controlling serving of an ad using its relevancy to a request, the method comprising: a) accepting, by a computer system including at least one computer, geolocation information associated with the request; b) comparing, by the computer system, the accepted geolocation information associated with the request with geolocation targeting information associated with the ad to generate a comparison result; c) determining, by the computer system, the relevancy of the ad using at least the comparison result; d) controlling, by the computer system, the serving of the ad, for rendering on a client device, using the determined relevancy of the ad; e) determining, by the computer system, whether the ad has geolocation price information corresponding to the geolocation information accepted; and f) if it is determined that the ad has geolocation price information corresponding to the geolocation information accepted, then determining, by the computer system, a score using at least the geolocation price information, otherwise determining, by the computer system, the score using at least general price information of the ad, wherein the act of controlling the serving of the ad further uses the score of the ad, and wherein the geolocation targeting information associated with the ad corresponds to an area defined by at least one geographic reference point.
  5. (In the present case, the latter features concerning a “score” appear to restrict the scope of the patent. This presents the possibility of a design-around.  However, the claims are sufficiently broad to require careful consideration if working in this area.)
  6. Gain lots of comments from Internet users about how “patents destroy creativity” and allow “big corporations to shut-out hard-working all-[insert country] inventors / start-ups” (even though it is nigh-on impossible to obtain a granted patent with a scope as broad as that insinuated in the article and you can equally argue patents allow “hard-working all-[insert country] inventors / start-ups” to compete on an equal footing with “big corporations ).
  7. Ignore all possibility of licensing; even if company X did obtain a broad patent to Y, if you were a small start-up you could still request a reasonable licence from X. Whether they would be willing to grant such a licence is another issue but several countries allow compulsory licensing where a reasonable licence is unobtainable.

Facebook “news feed” Patent

There has been a bit of a stir in the online community on hearing the news that the Facebook team (Zuckerberg et al.) have been granted a patent (US 7,669,123).  The patent has claims directed to “displaying a news feed in a social network environment”.

As with many reports concerning patents, there has been a lot of misinterpretation (“Facebook patents news-feed”) of the facts. Hence, I will try to remedy some of that below:

  • A patent appears only to have been granted in the US.
  • When analysing a granted patent the first place to start is the independent claims that set out the scope of legal protection.  In this case the independent claims are 1, 16 and 24.  They are directed to the standard set of “method”, “system” and “computer readable medium”.  Each independent claim has a similar feature-set.
  • Claim 1 specifies:
  • 1. A method for displaying a news feed in a social network environment, the method comprising:
  • monitoring a plurality of activities in a social network environment; storing the plurality of activities in a database;
    generating a plurality of news items regarding one or more of the activities, wherein one or more of the news items is for presentation to one or more viewing users and relates to an activity that was performed by another user; attaching a link associated with at least one of the activities of another user to at least one of the plurality of news items where the link enables a viewing user to participate in the same activity as the another user;
    limiting access to the plurality of news items to a set of viewing users; and displaying a news feed comprising two or more of the plurality of news items to at least one viewing user of the predetermined set of viewing users.

  • As you can see, this requires several steps over-and-above simply “providing a news feed”.  However, at first glance, the claim seems pretty broad; I can foresee several “news feeds” implemented by parties other than Facebook falling within the claim.
  • The filing date is 11 August 2006.  It appears that a fair few documents were cited as prior art.  However, the US Examiner was convinced of patentability.  If the online community is concerned they could possibly locate relevant art pre-dating the filing date.  I can see arguments brewing over the precise meaning of “in a social networking environment”; does this cover project management or calendar applications?
  • It will be interesting to see whether Facebook decide to enforce the patent against anyone.  My gut feeling is that there could be relevant prior art out there that was not presented to the US Examiner.