USA

DABUS “over there”

Judge Brinkema, sitting as a District Court Judge in the Eastern District of Virginia, has upheld the USPTO’s rejection of Thaler’s DABUS applications on the basis that DABUS cannot be an inventor under the US Act.

In the United States, Dr Thaler has two patent applications – US Application Serial Nos 16/524,350 and 16/534,532. In both, DABUS was the nominated inventor and Dr Thaler claims entitlement on the basis of assignment.

As you will no doubt recall, DABUS is a “creativity machine” or artificial intelligence.

To highlight the ludicrousnessfictional nature of the universe we are operating in, Dr Thaler as the owner of DABUS executed the assignment to himself:

In view of the fact that the sole inventor is a Creativity Machine, with no legal personality or capability to execute said agreement, and in view of the fact that the assignee is the owner of said Creativity Machine, this Assignment is considered enforceable without an explicit execution by the inventor. Rather, the owner of DABUS, the Creativity Machine, is signing this Assignment on its behalf.

When the America Invents Act was passed, amongst other things it inserted a definition of “inventor” into the Act so that 35 USC §100(f) provides:

(f) The term “inventor” means the individual or, if a joint invention, the individuals collectively who invented or discovered the subject matter of the invention.

Perhaps (with respect) unsurprisingly, Judge Brinkema ruled that “individual” meant a natural person.

In doing so, her Honour was fortified by the natural or ordinary meaning of the word. Contextually, there were also other references in the Act where Congress had used the term “individual” in reference to the inventor. (For example, §115(a)(1) and (b)(2).)

In addition, the Supreme Court had construed the term “individual” in the Torture Victim Protection Act as referring to a “natural person”. And several Federal Circuit decisions had declared that “inventors must be natural persons” albeit not in the context of the meaning of §100(f).

Judge Brinkema then explained that Dr Thaler “having neither facts nor law to support his argument” contends that policy considerations and the general purpose of the Constitution’s Patent Clause required the statute to be interpreted to permit AIs to be inventors:

Allowing patents for AI-Generated Inventions will result in more innovation. It will incentivize the development of AI capable of producing patentable output by making that output more valuable …. Patents also incentivize commercialization and disclosure of information, and this incentive applies with equal force to a human and an AI-Generated Invention. By contrast, denying patent protection for AI-Generated Inventions threatens to undermine the patent system by failing to encourage the production of socially valuable inventions.

Patent law also protects the moral rights of human inventors and listing an AI as an inventor where appropriate would protect these human rights …. [I]t will discourage individuals from listing themselves as inventors without having contributed to an invention’s conception merely because their name is needed to obtain a patent. Allowing a person to be listed as an inventor for an AI-Generated Invention would not be unfair to an AI, which has no interest in being acknowledged, but allowing people to take credit for work they have not done would devalue human inventorship.

Judge Brinkema considered that binding rulings of the Supreme Court and the Federal Circuit repeatedly held that policy arguments could not override a statute’s plain language. Her Honour also pointed out that, when Congress passed the America Invents Act, AIs were in existence and it was aware of them. Moreover, the USPTO’s own consultations had not exposed any strong support for AIs to be inventors.

Ruling against Thaler, Judge Brinkema concluded:

As technology evolves, there may come a time when artificial intelligence reaches a level of sophistication such that it might satisfy accepted meanings of inventorship. But that time has not yet arrived, and, if it does, it will be up to Congress to decide how, if at all, it wants to expand the scope of patent law.

What does this mean for Australia?

Plainly, the American context is not directly applicable to Australia since, as Beach J pointed out at [118], our Act does not have a definition of “inventor”. So, there is much greater scope for policy arguments to operate.

In that connection, the USPTO report cited by Judge Brinkema can be found here.

Ordinarily, I would be on the side of progress: the NRDC view of the world rather than D’Arcy v Myriad. Our courts, of course, must fit within the D’Arcy v Myriad world view unless Parliament were to bestir itself.

Apart from South Africa (which I understand does not undertake substantive examination of patent applications), Dr Thaler’s applications have been rejected on the ground that an AI is not an inventor by the UKIPO and EPO as well as in the USA. Government policy, which appears to have aligned with the Productivity Commission‘s argument that Australia as an intellectual property importing nation should not be out of step with the international environment, would suggest that an AI should not qualify as an inventor. Can we really afford to keep repeating the mistake made in the 3M case? However, an appeal is pending in the EPO. Maybe there will be an appeal in the USA too but the Federal Circuit’s prior indications do not augur well for the success of that.

It is also difficult to comprehend why, if as our Courts have ruled, that authors for copyright purposes must be humans, the same does not apply to inventors. Of course, our law now explicitly recognises moral rights as part of an author’s rights and there is no corresponding provision under Australian patent law. But both types of rights are justified by the same rationales – natural law or Lockean theory of property and, even, the so-called utilitarian theory.

I guess we shall see.

Thaler v Hirshfield ED VA, 2 September 2021 1:20-cv-903 (LMB/TCB)

Lid dip, Prof. Dennis Crouch at Patently-O.

US DMCA Safe Harbors Review

The US Copyright Office has published a report about its review of §512 of the Digital Millenium Copyright Act – the service provider safe harbors. (Australia has its own safe harbour provisions in section 116AA and following of the Copyright Act 1968 but, as their availability is limited to a much narrower classe of “service providers”, they have not proved of much interest.)

According to the US Copyright Office’s report, this is the first comprehensive review of the operation of the safe harbors in the 20 years since their enactment.

The Copyright Office says its report does not recommend any wholesale changes to the scheme. However, there are “certain areas where Congress may wish to fine-tune” the section to better balance its operation. There are 12 recommendations about:

  • the definition of service provider who may qualify for the safe harbors;
  • the requirements for a repeat infringer policy
  • what level of knowledge of an infringing activity should a service provider have before the safe harbor no longer applies
  • appropriate identification of the allegedly infringing content and its location
  • the penalties for misrepresenting infringement claims or counter-notices
  • the extent to which a rights holder must take into account fair use before issuing a take-down notice
  • the extent to which notification standards reflect current technological developments
  • the time frames for response to counter-notices disputing a take-down notice
  • the mechanisms for subpoena-ing service providers for information about alleged infringers
  • the scope of injunctions
  • possible non-statutory approaches
  • alternative stakeholder proposals including web-site blocking and notice and staydown proposals which the Copyright Office considers require further study.

In addition to the review of the operation of the safe harbors and recommendations, there are also chapters on how the “online ecosystem” has developed since the enactment of the DMCA and legal approaches in other countries including our very own “site blocking” laws.

US Copyright Office summary

Full Report: Section 512 of title 17, May 2020

The Hague Agreement: a cost benefit analysis

IP Australia has published a cost benefit analysis for Australia joining the Hague Agreement for registration of designs.

You are no doubt thinking that sounds very exciting (not). But, even if you are not into registered designs, you SHOULD READ IT. This is the Government’s first attempt at applying the Productivity Commission’s call for any proposals to reform intellectual property laws to be economically justified. As the Report says in the first paragraph of the Executive Summary:

The report assesses the impacts [i.e., the costs and benefits to Australia of joining the Hague Agreement] with reference to the Productivity Commission’s (PC) guiding principles of effectiveness, efficiency, adaptability and accountability. This report is intended to form part of the evidence base in relation to whether Australia should join the Hague Agreement.

So, unless it involves an acronym that is like TPP, this could well be a harbinger of things to come.

And what does it conclude find:

  • IP Australia’s best estimate of the net benefit for Australian designers is $1.7 million;[1]
  • IP Australia’s best estimate of the net cost to Australian consumers from higher prices resulting from the longer term of design protection is $58 million;[2]
  • to add a little bit more spice to the debate, IP Australia’s best estimate of the net cost to Australian IP professionals is $2.5 million;[3] and
  • IP Australia’s best estimate of the net cost to the Australian government of implementing new systems etc. to comply with Hague is $2.8 million.[4]

The big question IP Australia is asking you is how realistic are these estimates?

Now, in arriving at these numbers, the Report does include quite a lot of hard data.
For example, most Australians who file designs overseas do so in the EU, the USA, NZ and China. On the other side of the coin, most incoming design registrations were from the USA, the EU, Japan, NZ, Switzerland and China.[5]

On the other hand, the Productivity Commission reported that less than 20% of registered designs are renewed beyond the first 5 year term.[6] According to IP Australia, however, approximately half of all design registrations are renewed for the second 5 year term and non-residents are more likely to renew than Australians.[7]

Will we become better at designing if we “stick” with our current settings – 19th out of the top 40[8] – or should we “twist” and sign up? Of course, there is an anterior question: do we even care about good design in the first place?

IP Australia is seeking feedback on its cost-benefit analysis and its proposed methodology to elicit additional evidence and views with the aim of finalising the analysis in 2018. You should get your say in by 31 May 2018.

The Hague Agreement Concerning the International Registration of Industrial Designs: A cost-benefit analysis for Australia March 2018


  1. This represents the costs savings from the simplified application procedure and the increased profits from taking new designs overseas. IP Australia estimates the range of benefit is from $0.03 million to $6 million.  ?
  2. This represents how much Australian consumers would pay to overseas owners of registered designs if the term of a registered design was extended from 10 years (currently) to the minimum 15 years required under Hague. IP Australia estimates a resulting range of net outflows from $23 million to $114 million.  ?
  3. IP Australia anticipates that “IP professionals” will garner some extra work at the examination stage but will lose work at the filing stage as the Hague Agreement provides for one central application to WIPO rather than multiple individual application to each separate jurisdiction. IP Australia estimates a range from a benefit of $0.3 million to a cost of $12 million.  ?
  4. The Government (presumably that means IP Australia) will incur costs between $2.3 and $3.4 million in upgrading its IT systems.  ?
  5. Report p. 10. It’s not clear from this part of the Report whether Australian applicants filed in all, some or only one of those destinations.  ?
  6. Productivity Commission, Intellectual Property Arrangements: Final Report, p. 337. These were the figures from ACIP as at 2013.  ?
  7. Report p. 11. In 2010, 66% of non-residents renewed. How the discrepancy between the Productivity Commission’s figures (i.e.,
    ACIP’s figures) came about is not clear.  ?
  8. Report Appendix 3 table 4.1.  ?

Widespread dissatisfaction in US with Supreme Court’s patentable subject matter tests

The USPTO has published a report on its public review of the rules patent eligible subject matter under US law – what we would call a “manner of manufacture”.[1]

The Report does not appear to be the US Commissioner’s recommendations, but rather the results of consultations with the public.

As the Report notes, it is widely accepted in the USA that the Supreme Court’s decisions between 2010 to 2014 in Bilski, Mayo, Myriad and Alice have substantially altered what is patentable subject matter under US law and what not. The most dramatic effects being experienced by the life sciences and computer-related technologies.

While some submissions considered that it would sufficient to let the common law process of evolution unfold or the Commissioner could take administrative action to alleviate the effects of the Supreme Court’s decisions, “a majority, however, recommended legislative change”:

According to these participants, the Court’s precedent is having such a harmful impact on innovation and business development that a legislative solution is critical. ….

There appears to have been rather less uniformity about what the legislative solution should be.

  1. Some submissions called for a legislative requirement only that the claim be for a technological or useful art, without a requirement for “newness”.
  2. Some submitted that the requirement should be something having a practical application.
  3. Some submissions argued that express legislated exceptions should replace the Supreme Court’s common law exceptions. AIPLA for example contended for an exception:

    A claimed invention is ineligible … only if the claimed invention as a
    whole exists in nature independent and prior to any human activity, or
    can be performed solely in the human mind.

  4. Some submissions called for the legislation to make it clear that patent eligibility is a separate requirement to the other requirements such as novelty and obviousness, and to be considered separately from those requirements.
  5. Several commentators thought that the problem of “pre-emption”[2] could be addressed by introducing a specific exemption from infringement for research.

Our High Court in its own Myriad decision managed to adopt an even more alarming approach to patentable subject matter notwithstanding that Parliament had introduced an explicit research defence in s 119C. While it would appear likely to be some time before a clear solution emerges in the USA, maybe these developments should also give us pause for thought, given how enthusiastically the Patent Office and, under its guidance, the Full Court has jumped on the Alice type bandwagon, albeit drawing on the even more curious European approach.

Lid dip: Patently-O

Patent Eligible Subject Matter: Report on Views and Recommendations from the Public (pdf)[3]


  1. Patents Act 1990 s 18(1)(a)  ?
  2. That is, “concerns that patents on foundational technological tools may stifle scientific progress by tying up the basic building blocks of human ingenuity”.  ?
  3. For a rather more humorous take, see IP Musings.  ?

US Supreme Court adopts international exhaustion for patents

Last week, in Impression Products v Lexmark the US Supreme Court declared that an authorised sale of a patented product abroad exhausts the patentee’s rights within the United States of America. This follows on from 2013’s Kirtsaeng ruling adopting international exhaustion for copyright.

There is lots of analysis already, including Patently-O and Scotusblog, so this will be brief:

The underlying issue is printer manufacturers’ ongoing attempts to extract value according to usage of the printer by “metering” usage through charges on toner cartridges.

Lexmark has a number of patents over its toner cartridges. It offered patented toner cartridges for sale in two ways: at full price, with no restrictions or, for a 20% discount in return for a signed contractual condition that the customer would not refill the cartridge but return it to Lexmark.

Remanufacturers (vendors of refilled toner cartridges) had been acquiring Lexmark toner cartridges, circumventing the microchips preventing refilling then and reselling them.[1]

In this action, Lexmark had sued two groups of remanufacturers . The first group had obtained the cartridges they refilled within the United States (presumably the original owner of the cartridges was in breach of its contract by passing its used (empty) cartridges along). The second group had acquired their cartridges outside the United States and imported them into the United States for resale.

In summary, the majority of the Supreme Court[2] held:

We conclude that a patentee’s decision to sell a product exhausts all of its patent rights in that item, regardless of any restrictions the patentee purports to impose or the location of the sale.

In the majority opinion, Robert CJ noted that the 1890 decision of Boesch v Graff – the Supreme Court’s only previous consideration of this issue, did not concern parallel imports, but products made in Germany legally by someone other than the US patentee.

Given Lexmark itself appears to have sold the cartridges overseas, Prof. Wasserman Rajec notes that the Supreme Court’s decision does not settle what qualifies as an sale abroad authorised by the patentee.

Ginsburg J dissented

As her Honour did in Kirtsaeng, Ginsburg J dissented from the adoption of international exhaustion:

Because a sale abroad operates independently of the U. S. patent system, it makes little sense to say that such a sale exhausts an inventor’s U. S. patent rights. U. S. patent protection accompanies none of a U. S. patentee’s sales abroad—a competitor could sell the same patented product abroad with no U. S.-patent-law consequence. Accordingly, the foreign sale should not diminish the protections of U. S. law in the United States.

Her Honour also considered that patent law and copyright law were sufficiently different that the rule applicable in copyright (in the USA) should not apply to patent law:[3]

the two “are not identical twins,” id, at 439, n. 19. The Patent Act contains no analogue to 17 U. S. C. §109(a), the Copyright Act first-sale provision analyzed in Kirtsaeng. See ante, at 13–14. More importantly, copyright protections, unlike patent protections, are harmonized across countries. Under the Berne Convention, which 174 countries have joined, members “agree to treat authors from other member countries aswell as they treat their own.” Golan v. Holder, 565 U. S. 302, 308 (2012) (citing Berne Convention for the Protection of Literary and Artistic Works, Sept. 9, 1886, as revised at Stockholm on July 14, 1967, Arts. 1, 5(1), 828 U. N. T. S. 225, 231–233). The copyright protections one receives abroad are thus likely to be similar to those received at home, even if provided under each country’s separate copyright regime.

What’s the position in Australia?

Until the High Court makes another one of its ex cathedra policy declarations,[4] the position in Australia is different.

First, when a patentee sells a patented product in Australia, the purchaser gets an implied licence to exercise all the rights in the patent: National Phonograph Co v Menck.[5] Being an implied licence, it could be excluded by appropriate contractual terms.

Secondly, where a patentee itself sells the product in an overseas market, there is also an implied licence to import it into Australia.[6] If the sale in the overseas market was made by a licensee from the patentee which did not also have a licence to sell in Australia, however, parallel importing would infringe.[7]

Impression Products Inc v Lexmark International Inc (30 May 2017)


  1. Lexmark had previously failed to stop these types of practices using the anti-circumvention provisions of the Digital Millennium Copyright Act.  ?
  2. Ginsburg J dissented from that part of the Court’s ruling relating to international exhaustion.  ?
  3. In International Parcel Express v Time Life, the High Court considered that copyright law involved different considerations to patent law and distinguished the patent law treatment in the context of parallel importing of books.  ?
  4. See for example iceTV and D’Arcy v Myriad.  ?
  5. The Time Life decision affirmed the continuing validity of National Phonograph v Menck, albeit in dicta.  ?
  6. Betts v Wilmott (1871) LR 6 Ch App 239.  ?
  7. Société Anonyme des Manufacturers de Glaces v Tilghman’s Patent Sand Blast Co Ltd (1883) 25 Ch D 1.  ?

Selected links,from last week

Here is a selection of links to IP-related matters I found interesting this week:

Patents

Trade marks

Copyright

Remedies

Not categorised

I hope you find some interesting. If you did or have a question, leave a comment or send me an email

Google Books = fair use in USA

Just in time for the 2015 Copyright Symposium, the Second Circuit Court of Appeals has ruled that the Google Books Project is “fair use” of copyright and so not infringing.

Judgment here (pdf). Opinion authored by Circuit Judge Leval.

Eleanora of the IPkats first look here; Rebecca Tushnet focuses on the fourth factor discussion here. The “four factors” from §107 are:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.

Before responsibility for copyright was transferred to the Department of Communications and the Arts, the Commonwealth Attorney-General had commissioned a study of the economic effects of the ALRC’s recommendation to introduce “fair use” into Australian copyright law.

The Authors Guild v Google Inc. (CA2 Oct 16. 2015 13-4829-cv)

Software patents in the USA

Yesterday, the US Supreme Court heard oral argument on the question of the patentability of Alice Corporation’s software system for a method of payment, in denying the validity of which 10 judges of the Federal Circuit famously came up with 7 different opinions.

Several patents and claims are in issue, all relating to a computerized trading platform used for conducting financial transactions in which a third party settles obligations between a first and a second party so as to eliminate “counterparty” or “settlement” risk.

The question presented:

Whether claims to computer-implemented inventions-including claims to systems and machines, processes, and items of manufacture-are directed to patent-eligible subject matter within the meaning of 35 U.S.C. § 101 as interpreted by this Court?

As petitioner, the patentee (Alice Corp) will argue first. Respondent’s time will be split between CLS Bank and the US Government who has filed an amicus brief highlighting a misguided argument that “the abstract idea exception is patent law’s sole mechanism for excluding claims directed to manipulation of non-technological concepts and relationships.”

Transcript here. Some extracts here

One interesting point: the questioning of the advocates about which of the competing options proposed by the amici they preferred as solutions to the issue.

Summary of briefs with links to the briefs

Washington Post preview

Our own battles in this front are still proceeding with a decision awaited in the Research Affiliates appeal and RPL Central.

Meanwhile the USPTO has issued revised guidelines: 2014 Procedure For Subject Matter Eligibility Analysis Of Claims Reciting Or Involving
Laws Of Nature/Natural Principles, Natural Phenomena, And/Or Natural Products
.