Patents: patentability and validity 2005 developments

United Kingdom

The third of three recent decisions from the House of Lords was rendered in 2005 bringing about a new test for novelty. Software patents also came under review.

Test for novelty of patents reconsidered by House of Lords

In October 2005 the House of Lords handed down its decision in Synthon BV v Smithkline Beecham plc, allowing Synthon’s appeal, and restoring the trial judge’s finding of invalidity for lack of novelty. Of significant interest are the House of Lords’ considerations of the legal requirements for the test of novelty. In particular, the House of Lords determined that there are two requirements for anticipation: a “prior disclosure” and “enablement”. Whilst these concepts have previously been considered together in the concept of an “enabling disclosure”, the House of Lords stated that it is important that the two concepts be kept distinct.

Paroxetine is a compound used to treat depression and related disorders. It has for some time been marketed in the form of its hydrochloride hemihydrate salt under the name Paxil or Seroxat. These proceedings arose out of the more or less simultaneous discovery in about 1997 by the claimant Synthon BV, a Dutch pharmaceutical company, and Smithkline Beecham plc (Beecham), a UK pharmaceutical company, that a different paroxetine salt, paroxetine methanesulfonate (PMS), has properties which make it more suitable for pharmaceutical use. The disputed patent covered a crystalline form of PMS. Synthon challenged this patent in 2001 as being anticipated by its own, unpublished application.

Both Synthon and Beecham discovered this invention at a similar time. Synthon filed an application under the Patent Cooperation Treaty in 1997 for a broad class of compounds, including PMS, and described how to make PMS in crystalline form. Beecham filed a UK priority application in 1998, before Synthon’s application was published, claiming a particular form of crystalline PMS (by reference to its IR and XRD peaks). Beecham’s UK patent, deriving from its priority application, was published in 2000.

Synthon submitted that Beecham’s invention was not new, and that its own application disclosed the same invention as patented by Beecham, and that the ordinary skilled man was able to produce the invention based on the disclosed information and his general knowledge. Synthon convinced the High Court, which in 2002 declared Beecham’s patent invalid. But in 2003 the Court of Appeal overturned the ruling, which Synthon in turn appealed to the House of Lords.

Synthon accepted that the crystalline form of PMS had not been “made available to the public” before the priority date and therefore did not rely on Section 2(2) of the Patents Act 1977 (the Act). They relied on Section 2(3), claiming that it was deemed to be part of the state of art by virtue of having been disclosed in Synthon’s patent application.

The two issues were whether:

  • Synthon’s application disclosed the invention which had been claimed in the patent (the disclosure issue)
  • an ordinary skilled man would be able to perform the disclosed invention if he attempted to do so by using the disclosed matter and common general knowledge (the enablement issue).

Allowing the appeal, Lord Hoffmann stated that disclosure and enablement are distinct concepts, each with its own function and rules and criticised the Court of Appeal for intermingling the two concepts.

Lord Hoffmann said that the matter relied upon as prior art must disclose subject matter which, if performed, would necessarily result in an infringement of the patent. Infringement must not merely be a possible or even likely consequence of performing the invention disclosed – it must be necessarily entailed. It will usually be apparent to someone who is aware of both the prior art and the patent that it will do so. But patent infringement does not require that one should be aware that one is infringing (Merrell Dow v Norton). Whenever subject matter described in the prior disclosure is capable of being performed and is such that, if performed, it must inevitably result in the patent being infringed, the disclosure condition is satisfied. Lord Hoffmann stated that “[t]he flag has been planted, even though the author or maker of the prior art was not aware that he was doing so”.

Lord Hoffmann continued to say that it is this requirement that performance of an invention disclosed in the prior art must necessarily infringe the patent which distinguishes novelty from obviousness. The Synthon application was deemed to form part of the state of the art for the purposes of novelty (section 2(3)) but not for the purpose of obviousness (section 3). The application disclosed an invention which, if performed, would infringe Beecham’s patent. The subject matter described in the patent was crystalline PMS and a skilled person who performed that invention would inevitably infringe it, even though he might on reading the patent believe he would not. There is only one crystalline form of PMS and any crystals would invariably have the characteristics described in the patent. The IR and XRD peaks identified were therefore superfluous.

Lord Hoffmann said that “enablement” means that the ordinary skilled person would be able to perform the invention which satisfies the requirement of disclosure. This requirement applies whether the disclosure is in matter which forms part of the state of the art by virtue of section 2(2) or, as in this case, section 2(3). In this case, the disclosure in the application was PMS and there was no dispute that it would have enabled the skilled person to make PMS. The pertinent issue was factual and related to whether the skilled person would have been able to crystallise the PMS. Synthon specified in their main example a solvent that proved unsuitable for crystallisation. Despite this the judge at first instance found that the skilled man would have tried one of the other solvents mentioned in the application or which formed part of his common general knowledge and would have been able to make PMS crystals within a reasonable time. Lord Hoffmann said this was a finding of fact by a very experienced judge with which an appellate court should be reluctant to interfere. On that basis, he held that the Synthon patent application did satisfy the enablement test and, as a result, the Beecham patent was invalid.

The case is noteworthy for a number of reasons:

  • “Enabling disclosures”: whereas previously, it has been common practice to refer to the concept of “enabling disclosures”, in future it will be necessary to deal with the concepts of “disclosure” and “enablement” separately. Lord Hoffmann stressed that it is very important to keep these concepts distinct and that this will result in less confusion regarding the law of anticipation going forward.
  • “Disclosure”: previously it has been common to consider that there are two forms of anticipatory disclosure – a disclosure of the patented invention itself and a disclosure of an invention which, if performed, would necessarily infringe the patented invention. Lord Hoffmann has clarified that, in fact, these are aspects of a single principle, namely that the anticipation requires prior disclosure of subject matter which, when performed, must necessarily infringe the patented invention.
  • “Enablement”: Lord Hoffmann has confirmed that, as at the EPO, the test of enablement is the same whether it is being considered for the purpose of anticipation or insufficiency – a point on which the Court of Appeal did not comment.
  • The role of the skilled reader and reliance on common general knowledge is different in respect of “disclosure” and “enablement”. In the case of disclosure the skilled reader will rely upon common general knowledge to assist in their construction of the disclosure (along the lines of that discussed by the House of Lords in Kirin-Amgen). In the case of enablement, the common general knowledge will be used by the skilled reader to assess whether he is able to work the invention.
  • Trial and error experimentation will only be possible at the “enablement” stage. The trials that may be conducted will be a question of fact involving consideration of the application of standards, the problem in hand, the assistance provided by the disclosure itself and the extent of common general knowledge.

Statutory exclusions from patentability under review

According to section 1(2) of the Act, the following are not inventions:

  • A discovery, scientific theory or mathematical method.
  • A literary, dramatic, musical or artistic work or any other aesthetic creation whatsoever.
  • A scheme, rule or method for performing a mental act, playing a game or doing business, or a program for a computer.
  • The presentation of information.

Some of these exclusions have been questioned over the years, perhaps none more so than the prohibition against patenting “a program for a computer”. Indeed, this specific exclusion has been criticised as not giving a true reflection of the current position on the patentability of software programs in the UK. A series of cases in the UK have considered computer software to be patentable (in particular, the decisions in Merrill Lynch [1989] RPC 561 (CA), Fujitsu [1996] RPC 511 and [1997] RPC 608 (CA) and Gale [1991] RPC 305). The current position in the UK is that software which shows a technological effect, and has the capability of being applied in industry, will be treated as patentable subject matter. This approach was reconfirmed by the Patents Court in a number of cases throughout 2005, including Halliburton Energy Services Inc v Smith International (North Sea) Ltd (Halliburton) and in the matter of Patent Applications GB 0226884.3 and 0419317.3 by CFPH LLC (CFPH).

The Halliburton decision
Halliburton Energy Services Inc (Halliburton) owned two patents for the design and use of drill bits for drilling in rock in the oil industry, using complex computer simulations and design programs. Both patents related to software programs that used data obtained from the analysis of the performance of different types of drill bits used at different angles and forces, together with other variables involved in the drilling of rock.

Halliburton brought proceedings against Smith International (North Sea) Ltd (Smith) for infringement of its two patents, and Smith counterclaimed for revocation on the grounds that, amongst other things, the patents were invalid for insufficiency and that they were directed to unpatentable subject matter, namely a computer program or a method for performing a mental act.

On the topic of exclusions from patentability, Pumfrey J held that whilst a computer software program that merely produces a design but does not result in a physical object would be excluded under section 1(2) of the Act, previous case law has established that computer software programs are patentable to the extent that they produce a technical effect. Although Halliburton’s patents covered unpatentable subject matter, Pumfrey J envisioned “that this defect could be cured by amendment” of the patent applications. If the claims had been sufficiently linked to the industrial activity, the invention would have been restricted to the use of the relevant physical object and therefore would have been considered patentable subject matter.

The CFPH decision
The two patent applications in issue in this case related to computer-networked interactive wagering on the outcomes of events. The patent applications were rejected by the UK Patent Office (UKPO) on the basis that the relevant inventions were concerned merely with providing an improved transactional process over a computer network, and therefore fell within the business method exclusion of s1(2) of the Act. The UKPO also determined that the invention did not provide a technical contribution – which was required to make an otherwise excluded invention patentable – as the inventions in both applications merely represented non-technical changes to a business method in order to overcome technical problems.

The applicant appealed the UKPO’s decision, submitting that the claimed inventions were patentable since they solved technical problems by technical means.

Mr Prescott QC dismissed the applicant’s appeal. The judgment notably opened with the statement that this case was about the question “[w]hat is an invention?”, and then went on to find that the relevant inventions were not patentable on the basis that they were business methods.

Mr Prescott QC analysed the approaches adopted by the UKPO and the European Patent Office (EPO) regarding exclusions from patentability, and noted that “the difference between the two approaches is that the EPO filters out excluded subject-matter at the stage of considering obviousness – at the last stage – while the [UKPO] does so at the first stage (when considering excluded subject-matter)”. Mr Prescott QC held that the EPO was correct no longer to apply the technical contribution test. The first step should be to identify what was the advance in the art which was said to be new and non-obvious and susceptible of industrial application, and the second step was to determine whether it was new and non-obvious and susceptible of industrial application under the description of an invention, in the sense of Art. 52 of the European Patent Convention 1973.

The Crawford decision
Following the decisions in Halliburton and CFPH, the Patents Court presided over Crawford v The Comptroller General of Patents. In this case, the appellant, Crawford, appealed against a decision that his patent application was excluded from patentability under sections 1(2)(c) and 1(2)(d) of the Act. Crawford’s invention related to a display system for buses, consisting of two separate indicators, so as to facilitate the arrival of buses at regular intervals (rather than in clusters). The Comptroller had found that the invention was no more than a method of doing business or the presentation of information, and that it did not make the technical contribution required to make an otherwise excluded invention patentable.

Mr Justice Kitchen observed that in the Fujitsu case the Court of Appeal “explained the correct approach to be applied in determining whether or not an invention relates to excluded subject matter”. He quoted from Fujitsu, stating “it is and always has been a principle of patent law that mere discoveries or ideas are not patentable, but those discoveries and ideas which have a technical aspect, or make a technical contribution, are”.

Mr Justice Kitchen upheld the findings of the Comptroller, affirming that Crawford’s application was excluded from patentability under sections 1(2)(c) and 1(2)(d) of the Act. This conclusion was reached on the basis that the authorities (including Halliburton, CFPH and Fujitsu) all provide that “an inventor must make a contribution to the art (that is to say the invention must be new and not obvious), and that contribution must be of a technical nature (susceptible of industrial application and not within one of the areas excluded by Art. 52(2))”. The Patents Court therefore dismissed Crawford’s appeal.

The Shopalotto decision
The Patents Court also had cause to consider these issues in Limited v The Comptroller General of Patents. The patent application in question centred on a computer apparatus configured to provide a lottery playable via the internet. The applicant, Limited (Shopalotto), argued that the application was a claim to a game conceptually no different from a board game, and that it was therefore entitled to the benefit of a note of Official Ruling. The Comptroller held that the relevant invention was excluded from patentability under s.1(2)(d) of the Act.

The Comptroller’s decision was upheld by Pumfrey J on appeal, with the court confirming that the Act is to be interpreted in light of the provisions of the European Patent Convention 1973. The court affirmed that the real question when assessing whether a claim relating to software has technical effect (thereby preventing exclusion under Art. 52(2)(c) and Art. 52(2)(d)), is whether there is enough technical effect over and above that to be expected from the mere loading of a program into a computer. According to Pumfrey J, one should employ the following analysis:

First, determine what the inventor has contributed to the art over and above a computer operating in a new way as a matter of substance and, second, determine whether this contribution lies in excluded matter or, on the contrary, whether it consists in a technical contribution or effect.

On the facts, the claim was not founded in any contribution to the art outside the provision of various web pages to any person suitably equipped to view the pages provided by the server. Observing that “an inventive contribution cannot reside in excluded subject matter”, Pumfrey J affirmed that the Comptroller had correctly decided that Shopalotto’s application was excluded.

UKPO position and decisions
A week after the decisions in Halliburton and CFPH, the UKPO issued a notice, publicising a change in the way that patent applications will be examined for patentability. The new, 2-step procedure (as set out in CFPH) is to:

  • identify what is the advance in the state of the art that is said to be new and non-obvious (and susceptible of industrial application)
  • determine whether it is both new and non-obvious (and susceptible of industrial application) under the description of an “invention”.

It is interesting to note, however, that the new approach is not universally supported in all respects within the UKPO. In Fair, Isaac and Company Inc., BL O/392/05 the UKPO Hearing Officer observed that the decisions in Halliburton, CFPH, Crawford and Shopalotto are consistent with the decision in Fujitsu, on the basis that they all prescribe that an invention is not patentable if the relevant advance or contribution lay in excluded subject matter. In contrast, the Hearing Officer in the case of Overture Services Inc., BL O/331/05 could not identify a ready reconciliation between those judgements.

The UK position in relation to the patentability of software (and certain other excluded subject matter) remains in some respects unclear. The 2005 decisions in Halliburton, CFPH, Crawford and Shopalotto demonstrate that the crucial issue in deciding whether an invention falls within the category of “excluded matter” of s.1(2) of the Act is not simply whether the invention is, for example, a computer software program or business method, but whether the invention can be said to amount to a “technical effect” which contributes as a matter of substance to the prior art. A very general rule of thumb is that a method which only produces information is less likely to be patentable, whilst one that results in a physical object is more likely to have a technical effect and hence be eligible for patent protection.

If the only part of an invention that is new and which has a technical effect is a business method or program for a computer (or some other form of excluded matter), the invention will be excluded from patent protection in the UK. However, provided that the part which is new and innovative has a technical effect, the invention will likely be patentable.

Whilst the approaches of the UKPO and EPO are in some respects more in line following the CFPH approach, in others it appears differences remain. The EPO Board of Appeal has confirmed that “[a]n invention may…contain a mixture of technical and non-technical features and still be considered to have a “technical character”” (see T26/86 Koch & Sterzel & T769/92, Sohei). The EPO Board of Appeal is of the view that when an invention consists of a mixture of technical and non-technical features and has technical character as a whole, the assessment of the requirement of inventive step should take into account all the features which contribute to the technical character whereas features making no such contribution cannot support the presence of inventive step” (T641/00, Comvik and T531/03, Catalina Marketing). Following CFPH, however, it is unclear whether the UKPO and Court would allow non-technical features to contribute to the presence of an inventive step.

Full description of creative step and prior art required for sufficiency

An important principle of patent law is that the patentee must disclose sufficient information so that relevant members of the public are able to practice the invention once the monopoly expires. Article 83 of the European Patent Convention (EPC) requires that a European patent application “must disclose the invention in a manner sufficiently clear and complete for it to be carried out by a person skilled in the art”.

The corresponding provision of UK law is contained in section 14(3) of the Act.

In the Halliburton case (see above), Halliburton brought proceedings against Smith for patent infringement. Smith in turn applied for Halliburton’s patents to be revoked, arguing (amongst other things) that the patents were insufficient. Thus, Halliburton was compelled to establish that their patents could be replicated with reference only to the specification and claims contained in the patents, by a person skilled in the art.

In his 84 page judgement in Halliburton, Pumfrey J stressed that those involved in the preparation of patent applications must ensure that the disclosures give a full description of the creative step, and prior art where relied upon. In relation to the claims in the Halliburton patents, Pumfrey J stated that “it was a striking fact” that this had not been the case, as there was no clear description that explained the techniques required to construct certain aspects of the physical object.

In relation to prior art, Halliburton had relied upon disclosures contained in other patents, as well as disclosures which would form part of the common general knowledge. Pumfrey J found against Halliburton on both issues. For the prior art contained in other patents, Pumfrey J held that some of the disclosures were not correctly incorporated by reference and therefore Halliburton could not rely upon them. In relation to the disclosures Halliburton claimed were part of the common general knowledge, Pumfrey J stated that in relation to certain aspects there was no convincing demonstration of any common general knowledge, and the patent applications were consequentially insufficient.

Following the House of Lords decision in Kirin-Amgen (see below) it is important to provide the Court with the “context” of the invention, where possible in the specification itself. Where an invention emanates from scientific research, it is important to ensure that research is properly incorporated into the specification and the common general knowledge properly characterised.

“Obvious to Try” Test – Hurdle Raised

An assessment of obviousness often entails consideration of whether a particular course of action or research avenue was “obvious to try”. The doctrine is considered to derive from Diplock LJ’s comments in Johns Manville Corporation’s Patent. A line of authority from this case (including Brugger v Medic-Aid and Hallen v Brabantia) suggested that there only needed to be a “reasonable expectation of success” for a step to be an obvious one following this approach, although the likelihood of success would be assessed on a case-by-case basis. There appears to have been a raising of the barrier by the Court of Appeal in Saint-Gobain v Fusion last year.

The case concerned the validity of a patent to an invention consisting of using a zinc/aluminium alloy in place of zinc to prevent corrosion of buried pipes. The only issue in the case was that of obviousness. The defendants sought to run an “obvious to try” case citing Johns Manville Corporation’s Patent. The patentee countered that in this case there was simply no likelihood of success – one just did not know what would happen if one tried. After reviewing the expert evidence Jacob LJ dismissed the attack on inventive step since the evidence did not suggest any confidence in the result of any notional test:

“None of this to my mind remotely makes the idea of using Zn/Al alloy for pipes obvious – as something which is simply self-evident to the unimaginative man skilled in the art. The mere possible inclusion of something within a research programme on the basis you will find out more and something might turn up is not enough. If it were otherwise there would be few inventions that were patentable. The only research which would be worthwhile (because of the prospect of protection) would be in areas totally devoid of prospect. The “obvious to try” test really only works where it is more-or-less self-evident that what is being tested ought to work.”

A similar view (although to a different ultimate effect) was expressed by Pumfrey J in Mayne Pharma v Teva. In particular, the Judge refused to speculate on which of two courses of action might be followed by a skilled person where both were “open-ended”. The Saint Gobain “obvious to try” test was also quoted and applied last year in Schering-Plough v Norbrook Laboratories. The case looked at the test in the context of “class effects” of pharmaceutical products and provided interesting commentary also on the delicate balance to be struck in asserting obviousness of such effects on the one hand and insufficiency of the patent claim on the other.

This article first appeared in our UK Patents Review March 2006. To view this publication, please click here to open it as a pdf in a new window.