Mid-Year 2024 Update: U.S., EPO, and Chinese Software-Related Patent Grants Remain Steady

As an update to my previous posts from 2017, 2019, 2020, March 2021, August 2021, 2022, 2023, and February 2024, the tenth anniversary of the U.S. Supreme Court’s Alice Corp. v. CLS Bank decision has just passed. Yet, there is still no end to the debate over when a software (or computer-implemented) claim is patentable versus being simply an abstract idea “free to all men and reserved exclusively to none” (as eloquently phrased over 76 years ago by then-Supreme Court Justice Douglas in Funk Bros. Seed Co. v. Kalo Inoculant Co.).

As software continues to eat the world, and Artificial Intelligence (AI), quantum computing, cybersecurity, and Information Technology (IT) continue to dominate the headlines, job markets and venture investments, we continue to look at what percentage of issued patents by the U.S. Patent and Trademark Office (USPTO), the European Patent Office (EPO), and the China National IP Administration (CNIPA) are “software-related”?

As usual, we utilized the same methodology the United States Government Accountability Office employed in a 2013 report to Congress to determine what patents are “software-related.” That report relied on certain United States Patent Classification (USPC) classes and subclasses of applications most likely to include software-related claims as selected by expert advisors to the USPTO. With the assistance of IP services firm Clairvolex (and after converting from the USPC system to the Cooperative Patent Classification (CPC) system), data was pulled from the PatSeer Global Patent Database.

We also attempted to capture the percentage of software-related patents granted by the USPTO, EPO, and CNIPA focused on AI and similar concepts such as Machine Learning, Neural Networks, Fuzzy Logic, Supervised Learning, Unsupervised Learning, and the like in the Title, Abstract, Claims, and the Summary of Invention fields of the patents. What are the recent results?

For the first half of 2024 (i.e., January 1 – June 30, 2024):

• 61.0% of issued U.S. utility patents were “software-related” (a slight decrease from the 62.7% in 2023)
  • 7.9% of issued U.S. utility “software-related” patents were “AI-related” (compared to 7.8% for all of 2023)
• 50.2% of granted EPO patents were “software-related” (a slight increase from the 50.1% in 2023)
  • 3.5% of granted EPO “software-related” patents were “AI-related” (compared to 2.9% for all of 2023)
• 40.7% of granted Chinese patents were “software-related” (down from 42.4% in 2023)
  • 8.0% of granted Chinese “software-related” patents were “AI-related” (compared to 7.4% for all of 2023)
• The top 15 software-related granted U.S. utility patent assignees for 1H2024 were:

Despite the significance of the above numbers, the entirety of the patent bar awaits further action from Congress. The 118^th Congress is unlikely to act on the Patent Eligibility Restoration Act of 2023 [S.2140] introduced by Senators Chris Coons (D-DE) and Thom Tillis (R-NC). Given this is an election year and partisan squabbles abound, we will just look forward to the 119^th Congress in 2025. We’ve waited 10 years already, so, what’s one more!? Our patent-drafting fingers are still crossed.