Curtain Call For Computer Related Inventions in India: An Analysis of the Ferid Allani Case

The precedent with respect to the patentability of Computer Related Inventions in India ranges from little to non-existent; but not for lack of trying. In December 2019, the High Court of Delhi in Ferid Allani v. Union of India (2019 SCC Online Del 11867) examined the rejection of a patent by the Indian Patent and Appeal Board (IPAB) to a Computer Related Invention (CRI). The Bench set forth three propositions:

• that “most inventions are based on computer programs” and “it would be retrograde to argue that all such inventions would not be patentable”.
• that “the words “per se” were incorporated in the patent law?? so as to ensure that genuine inventions which are developed based on computer programs are not refused patents”.
• “Patent applications in these fields would have to be examined to see if they result in a ‘technical contribution’”.

The bench observed that new guidelines [then “the Guidelines for Examination of Computer related Inventions (CRI) 2016”] were published by the Patent Office after the order of the IPAB. Hence, the Court remanded the application to the IPAB on the ground that the patent evinced consideration “in the context of settled judicial precedents,…the Guidelines and other material including the legislative material”. The Court directed the IPAB to reconsider the matter on grounds of “technical contribution or technical advancement”.

However, the Patent Office, in an order dated January 7, 2020, refused to grant the patent on the grounds that the invention lacked novelty. Nevertheless, the order showcases the stance of the IPAB with respect to CRIs. The litigation, spanning a period of seven years, also exhibits the reluctance of the IPAB and the High Court of Delhi to lucidly define the term “technical effect”/ “technical contribution”. This article will focus on the fallacies of such an approach and it shall seek to analyze the current stance of the IPAB with respect to CRIs.

The Patent in Question

The patent [IN/PCT/2002/00705/DEL] was for a “method and device for accessing information sources and services on the web”. The claims in the patent consisted of both method and device claims. However, on first examination, the patent office rejected the application on the ground that it lacked novelty and was not patentable under Sections 2(1)(j) [“invention”] and 3(k) [“What are not inventions”] respectively. Furthermore, another examination report was issued on September 21, 2005, stateing that “despite the amendments made in the claims by the Petitioner, the application was still hit by Section 3(k)”. Aggrieved by the order of the IPAB, the Petitioner appealed to the High Court under Article 227.

Issues Before the High Court

The issues placed for consideration before the High Court were two-fold;

• Should a patent be granted under Section 2(1)(j) of the Patents Act?
• Is the patent exempted by the operation of Section 3(k) of the Patents Act?

Findings of the High Court

The Petitioner contended that the patent required a “particular method of implementation” and therefore, the interpretation of the IPAB was incorrect. The petitioner, citing the definition of “technical effect” as used in the Draft Guidelines for Examination of Computer related Inventions (CRI) 2013, submitted that the invention satisfies the criteria for technical effect. The definition is as follows:

Technical Effect: It is defined for the purpose of these guidelines as solution to a technical problem, which the invention taken as a whole, tends to overcome. A few general examples of technical effect are as follows: Higher speed, Reduced hard-disk access time, More economical use of memory, More efficient data base search strategy, More effective data compression techniques, Improved user interface, Better control of robotic arm, Improved reception/transmission of a radio signal.

Technical advancement: It is defined for the purpose of these guidelines as contribution to the state of art in any field of technology. It is important to divide between software, which has a technical outcome, and that which doesn’t, while assessing technical advance of the invention. Technical advancement comes with technical effect, but all technical effects may or may not result in technical advancement.

The Petitioner stated that the invention allowed the user to efficiently conduct a database search and made a more economical use of memory or higher speed, etc. Therefore, the Petitioner submitted that the invention sufficiently satisfied the criteria of “technical effect” as stated in the guidelines. Furthermore, the Petitioner also said that “Section (3)(k) ought to be interpreted in the context of the guidelines…” [corresponding to the 2013 Guidelines].

The Respondents contended that the High Court did not have jurisdiction under Article 227. The Respondents also made use of the alternative remedy doctrine. They submitted that the IPAB, a technical Tribunal, had already considered the situation, and therefore the Court need not reconsider the arguments.

The Court, confirming the arguments of the petitioner, held that Section 3(k) of the Patents Act must be interpreted in light of the recent guidelines [the 2016 Guidelines]. The Court observed that Section 3(k) placed a bar only on computer programs “per se”. It held that, since most inventions of the current era made use of computer programs, it would be discriminatory to reject a patent to such inventions for merely making use of computer programs in its functioning.  Therefore, it held that an application is to be evaluated with respect to its technical contribution.

However, I would argue that the Court’s analysis is cursory, at best. The Court’s judgment includes several errors:

• Though the Court noted that the definition of technical effect was to be evaluated in the context of settled judicial precedents and legislative materials, it failed to elucidate or present a definition of what can be construed as an invention exhibiting a “technical effect” or a “technical contribution”.
• The Court did not elaborate on the scope of Section 3(k) and 2(1)(ja). Instead, the Court merely noted that Section 3(k) was to be interpreted in line with the then 2016 guidelines.
• Most importantly, the Court did not state any clear grounds on which the petition was to be remanded back to the IPAB. It merely stated that the case warranted reconsideration in line with the then 2016 guidelines. This may have a cascading effect on other patent applications that may have been affected by the issuance of the then 2016 guidelines and the present 2017 guidelines. If the same line of reasoning is to be adopted, then the all such petitions may also have to be reconsidered.

We may infer that the Court refrained from elaborating on the definition of “technical effect/technical contribution” by deferring to the wisdom of the IPAB and the guidelines. But the Guidelines do not provide a lucid definition of what may be construed as “technical effect/technical contribution”.

Guidelines for Patentability

The 2017 guidelines state that the “examination procedure of patent applications relating to CRIs is the same as that for other inventions to the extent of consideration of novelty, inventive step, industrial applicability and sufficiency of disclosure, etc”. By the guidelines, the novelty criterion is to be adjudged under the various provisions of the Patents and based on the procedures laid down in 08.03.02 of the then Patents Manual of 2011. The Manual is sufficiently lucid about the criteria that an invention must conform to in order to pass the test of novelty.

The conundrum presents itself with the second criterion: Inventive Step. As suggested by the guidelines, if the determination of an inventive step with regard to CRIs is carried out in the same manner as in other categories of inventions, such an invention must necessarily conform to the standard of “technical advance”. The guidelines refer to the judgement of F Hoffman la Roche v Cipla Ltd [(2008) 148 DLT 598], wherein the Court stated that, “what constituted an inventive step is to be seen from the standpoint of technological advancement as well as obviousness to a person who is skilled in the art”.

Though the guidelines provide a clear idea on the criteria for obviousness (see Guidelines p. 10), the present guidelines also do not elucidate on what is technological advancement. The guidelines merely reiterate the position of law as laid down in Yahoo Inc v. Assistant Controller of Patents (OA/22/2010/PT/CH, December 8, 2011) and states that the “technical advance comparison should be done with the subject matter of invention and it should be found it is not related to any of the excluded subjects” (see Guidelines p. 11).  Therefore, we may infer that the guidelines offer little to no guidance in ascertaining the meaning of the term “technical advance”.

Reexamination by the Patent Office

In order to ascertain the legal position of the EU and of the UK with respect to the patentability of CRIs, the Court referred to the following judgments:

• Aerotel Ltd v. Telco Holdings Ltd & Ors
• The Vicom case
• AT&T Knowledge Ventures/Cvon Innovations v. Comptroller General of Patents
• IBM Case I and Case II
• Merrill Lynch case
• Gale case
• Fijitsu case
• Hitachi case
• Symbian Ltd v. Comptroller General of Patents
• Pension’s Benefits (Case no. (2000) T 931/95)
• Microsoft case – Board of Appeal
• Halliburton v. Smith
• Halliburton v. Comptroller General
• CFPH’s Application
• Duns Licensing, Boards of Appeal decision
• HTC v Apple

On perusal of the 30-page analysis made by the Controller, we may infer that the Court was on a quest to find the answer to two specific queries: (i) Whether CRIs are excluded by the usage of the term “per se” in Article 52 of the European Patent Convention and Section 1(2) of the Patents Act of UK; (ii) The meaning of “technical effect”/ “technical contribution”.

However, the order ultimately failed to do so, instead declaring that:

• Each case is to be decided in accordance with its own facts (Para 42).
• There is no agreed definition on technical advancement in the EU or in the UK since the term is inherently vague.
• As held in HTC v, Apple, the contribution made by a CRI, irrespective of the technical contribution, would fail the test of patentability, since computer programs would fall in the excluded category.

The order, on analyzing the merit of the patent over its prior art (dubbed ‘D1’), concluded that the basic features of the present application had been anticipated by the features of D1. It went even further to state that “D1 is a technical advancement over the present application”. Therefore, it concluded that the application would fail the test of novelty and it would fall within the bounds of Section 3(k).

However, the order failed to define the term “technical advancement”, which forms the crux of the present dispute. It has also not defined novelty for the purposes of a CRI. Ironically, the order’s perplexing analysis has simply not elaborated enough on these grounds to settle the confusion regarding the patentability of CRIs.

Time to Take a Stance

Both the High Court and the IPAB have declined to define the term “technical advancement”. Consequently, according to precedent, the position adopted by the High Court still stands, i.e., a CRI, if it adequately showcases technical advancement, is patentable. And the conundrum still remains unaddressed. If the Courts were to take a stance on defining the term rather than promoting the “case by case” analysis, it would be more fruitful to the development of intellectual property law in India. Moreover, in the Hoffman decision, the Court has observed that the observations made in foreign judgments are not the guiding factors to ascertain the true sense of the meaning of terms in the Indian scenario. Therefore, the only solution is for Indian Courts to take a stance.