Overcoming Obstacles: Securing Intellectual Property Rights For CRI-Based Inventions In India

Artificial intelligence is the use of computers and other devices to simulate human decision-making and problem-solving abilities. The well-known concepts of artificial intelligence (AI) and machine learning ensures big data to be more accessible through advancements in computer hardware. The development of machine learning, easier access to large data, and advances in computer technology have all contributed to the rise in the production of AI-based software. In a similar way, the other concepts, such as the Internet of Things, which uses networked devices to transfer data and perform automated tasks, and blockchain technology, which has the potential to revolutionize entire industries, are also developing quickly and encourage innovation in a variety of fields.

Today not only in India, but in the entire world, researchers are coming up with the inventions based on computer related inventions or AI-based, blockchain and Internet of Things inventions. So, the question again arises, is an inventor coming up with an innovation in this field of technology can apply for a patent in India?

A significant change is taking place in the nation's technological advancement due to the increasing use of CRI-based software applications. CRI-based inventions have led numerous patent offices to review their own software patentability rules in response to a spike in CRI (computer related inventions) patent submissions in India. This is mostly because these innovations are classified as excluded subject matter. Thus, the most important query is how to review patent applications for CRI-related technologies.

In India, a software patent was proposed in the 2005 Patent Amendment Act. The proposed amendment in clause 3(k) of the Act was to include a computer programme as such, apart from its technical application in industry or in combination with hardware, as well as a mathematical method, a business method, or an algorithm. However, this amendment was rejected by the Indian Parliament, which chose to retain clause 3 (k) as it is. The changes suggested in the ordinance were taken back.

There are divisions between those who support software patents and those who oppose them, as the Patent Act makes it clear that computer software in and of itself is not patentable.

Another argument would be that the Act's prohibition on patenting software in and of itself would only apply to software included in a bigger invention, so long as the larger invention satisfies the Act's patent requirements. This demonstrates that under Indian law, software cannot be patented "standing alone". It is important to note that software running on a general-purpose data processing machine (computer) is not eligible for patent protection since software cannot function independently of hardware. A software program does not become an invention only by adding traditional data processing hardware to it. The innovation can only be patented in its entirety if the software application is a component of a larger system and the system is patentable as a whole. In Section 3 (k), it is mandated that the computer programs are 'per se' not patentable. Now what does this 'per se' mean?

"The insertion of the word 'per se' has been proposed because sometimes a computer programme may contain other things, ancillary to or developed thereon," as reported by the Joint Committee on Patent Second Amendment Bill 1999 in its report. If they are inventions, the intention here is not to reject them for grant of patents. To be patentable, CRIs -based innovations must satisfy the essential legal standards of novelty, inventive step, and industrial applicability. The provision of Section 3(k) of The Indian Patents Act, 1970 defines the subject matter and activities that are excluded from patentability to the extent that they relate to the subject matter as given under the IPO's non-exhaustive list of "not-inventions," rather than providing a definitive definition of inventions. Under this provision, mathematical methods, business methods, computer programmes per se and algorithms are not considered as patentable subject matter.

The mathematical methods are considered to be acts of mental skill which are method of calculation, formulation of equations, finding square roots, cube roots and all other methods are therefore not patentable. With the advancement in computer innovation, numerical strategies are utilized for composing calculations and computer programs for distinctive applications and the claimed development is in some cases camouflaged as one relating to the innovative advancement instead of the numerical strategy itself.  These methods, claimed in any form, are considered to be not patentable.

The term Business Methods involves whole gamut of activities in a commercial or industrial enterprise relating to transaction of goods or services. As technology advances, e-commerce and B2B/B2C business transactions have increased significantly. In some cases, the claims are not explicitly described as business methods but appear to have some technical characteristics such as internet, network, satellites, telecommunications, etc. This exclusion is applicable to all business methods. Therefore, if the claims are essentially business methods, even using technology, they do not qualify as a patent subject matter.

All forms of algorithms, including but not limited to a set of guidelines, a series of actions, or a method articulated through a finite set of predefined instructions, are not eligible for patent protection. This is true whether the algorithms are used for problem-solving or not, and whether they use recursive or non-recursive logical, mathematical, or computational methods.

Patent applications, with computer programme as a subject matter, are first examined with respect to (1), (2) and (3) above. If an application's subject matter does not fit into one of these categories, it is examined to determine whether it qualifies as a computer program in and of itself.

If the claimed subject matter in a patent application is only a computer programme, it is considered as a computer programme per se and hence not patentable. As computer programs are stored in a computer readable medium, claims made about computer program products are not permitted. It is investigated whether the claimed subject matter—which includes, among other things, non-computer program material—is adequately disclosed in the specification and constitutes a necessary component of the invention.

If the subject matter of a patent application is not found excluded under the foregoing provisions, it shall be examined with respect to other criteria of patentability.

The four Indian patent offices (Kolkata, Mumbai, Delhi, and Chennai) did not have uniform policies when it came to granting software patents until 2015. The Intellectual Property Appellate Board (IPAB) brought attention to this fact in the Yahoo v. Controller and Rediff case. It was discovered that while some patent offices declined to give software patents, others were more likely to do so in the lack of any standards on the issuance of patents on computer-related inventions (CRI). In order to remove inconsistencies related to grant of software patents in India, the Controller of Patents issued guidelines related to CRI. The Indian Patent Office (IPO) first released a draft of the computer-related inventions (CRI) rules on June 28, 2013. The IPO met with a range of stakeholders and took their input into account. On August 21, 2015, the final guidelines were made available. Nevertheless, on December 14, 2015, the final standards were suspended through a public notice that lacked a clear explanation for the modifications. On February 19, 2016, a revised set of recommendations that were thought to be more stringent than the prior set were released. Stakeholders, offended by the restricted language, asked the IPO and the Department of Industrial Policy and Promotion (DIPP) to reevaluate the updated rules. The most recent version, which was released on June 30, 2017, reverts to the liberal stance.

The DIPP-established expert committee's suggestions served as the foundation for this edition. In order to take into account a wide spectrum of opinions, the committee looked over several representations and engaged in lengthy stakeholder meetings.

Examiners may use the following three-stage examination for reviewing CRI applications, according the CRI Guidelines of 2016: Interpret the claim correctly and determine what the real contribution is. If the contribution is limited to a mathematical approach, business method, or algorithm, deny the claim. If the contribution is focused on computer programming, see if it is claimed in connection with any innovative hardware, and take further action to ascertain whether the invention is patentable. A computer program cannot be patented in and of itself. Reject the claim if the computer application is the only thing that contributed. Go to the next stages of patentability if the contribution is found in both the hardware and the computer software.

Algorithms are frequently used in computer programs to make method or system assertions, with certain "means" denoting the ways in which flow charts or process steps work. It is common knowledge that the core idea of the invention—rather than the specific form it is claimed in—should be the primary consideration for determining patentability. With respect to the computer-related invention guidelines, there was a lack of transparency in the process used to arrive at the current set of guidelines and the guidelines reflect a seemingly narrow interpretation of the relevant law, both of which raise concerns and threaten to undermine an important sector of India's economy.

The official position of Indian Patent Office as quoted by PTI on the 2017 guidelines is that the new guidelines only present clarification to the patent office's earlier guidelines. The policy regarding the issuance of patents to CRIs remains unchanged. The phrasing used in the February 2016 recommendations may have given the impression that a "new hardware" provision was required in order to pursue patents for CRIs, even though this was not the case. But the Indian Patent Office has revised those guidelines and clarified that this clause is not mandatory."

Claims directed as "Computer Programme per se" are covered by the Office of the Controller General of Patents, Designs, and Trademarks' Guidelines for Examination of Computer Related Inventions (CRIs) 2017 clause 4.5.4. Patentability is not applicable to claims pertaining to computer programs in and of themselves. Examples of such claims include those pertaining to computer programs, sets of instructions, routines, and/or subroutines; also, claims pertaining to "computer program products," "storage medium having instructions," "database," and "Computer Memory with instruction" recorded in a computer readable medium are not eligible for patent protection. In the end, it is believed that the new CRI guidelines adopt a stance akin to that suggested by the court of appeal of England and Wales in the Aerotel/Macrossan case, even though they address the "computer programme per se" exclusion under Indian patent law. In discussion of the same, Justice Pratibha Singh at the Delhi High Court, in its 2019 decision in Ferid Allani v. Union of India and Ors, acknowledged that the future of innovation lay in AI, blockchain and related technologies, all of which are based on computer programmes, but they “would not become non-patentable inventions – simply for that reason.” It held that “technical effect” or “technical contribution” must be determined to decide patentability of CRIs, and that an invention merely being implemented using a computer program is no bar to its patentability.

In the aforesaid illustration of the Delhi High court, the main focus was drawn towards “technical effects”, “technical advancement” and “technical contribution” to qualify the applications related to computer programmes.

So, in the judgment, it was illustrated that:

“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 strategies;

More effective data compression techniques;

Improved use interface;

Better control of a robotic arm; and

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 same has been once again reasserted by the Hon'ble Delhi High Court (DHC) in Microsoft Technology Licensing, LLC Vs The Assistant Controller Of Patents And Designs, C.A.(COMM.IPD-PAT) 29/2022:

“The Court would thus reinforce the views expressed in Ferid Allani (supra) concerning the meaning of the term “computer program per se” in Section 3(k) of the Act. The patent applications should be considered in the context of established judicial precedents, Section 3(k) of the Act, extant guidelines related to CRIs, and other materials that indicate the legislative framework.”

“If a computer-based invention provides a technical effect or contribution, it may still be patentable. The technical effect or contribution can be demonstrated by showing that the invention solves a technical problem, enhances a technical process, or has some other technical benefit. The mere fact that an invention involves a mathematical or computer-based method does not automatically exclude it from being patentable. The invention can still satisfy the patentability requirements, including the requirement for a technical effect or contribution, to be eligible for patent protection. In other words, method claims in computer programme patents may be patentable if it involves a technical advancement and provides a technical solution to a technical problem and has an improved technical effect on the underlying software.”

To understand the above reasoning, it is required to understand that how the said technical effects or contribution will be showcased on AI-based technologies. AI-based inventions have essential layers of data, application and system. In eligibility framework of AI, data and application layers are not considered as such a technical aspect of the invention as they relate to purely abstract theories. Then, what is patentable? The answer to this question is system layer which is termed to be user-interaction layer of AI-based technology which runs software, displays output etc. In simple words, a system which gives physical or practical significance is patentable.

There are some of the patents that have received grant in India with a specification of demonstrating technical effects. Some of those patents are as below:

Indian Patent Application no.: 60/CHE/2010, titled as “artificial intelligence-based assessment and tutoring system and method thereof”, granted on demonstration of technical solution by providing emotional elements, such as encouraging tones, to enforce learning.

Indian Patent Application no. 3323/CHENP/2012, titled as “a system and method to model and monitor an energy load”, granted upon a demonstration of the technical effect of reducing the energy consumption of an air conditioning system.

Indian Patent Application no.: 202041003260, titled as “artificial intelligence enabled automated system for targeted content on display devices”, granted upon a demonstration of the technical advancement solving conventional technical problems.

Therefore, to make the AI like technologies to qualify as a patentable subject matter, and avoiding its fall under excluded subject matter, it is required to significantly integrate essential elements or features of AI in a practical aspect.

Hence, it can be concluded that CRI-based inventions are not completely ineligible for patents in India. The Indian Patent Office has begun reviewing CRI-related inventions, analyzing the "technical effect" triggered by these inventions. To objections raised regarding the patentability of CRI-based inventions, it is imperative for applicants to explicitly specify the technical effect or contribution of their invention. This entails defining broader terms in reference to a specific technical result and, if possible, highlighting how their invention sets itself apart in a practical and physical aspect from existing prior art.

Authors: Gopi Trivedi (Senior Partner) And Yashvi Khatri (Patent agent) At YJ Trivedi & Co. Views are personal.