Court of Appeal to consider if AI system can be a patent inventor

Background

This case originated from two UK patent applications (GB1816909.4 and GB1818161.0) filed by Dr Thaler in 2018. In the statements of inventorship for the patents, Dr Thaler submitted that the inventor was an artificial intelligence system called DABUS and that he had acquired the right to grant of the patents in question by "ownership of the creativity machine DABUS". He indicated that DABUS was comprised of two artificial neural networks, that had generated and assessed the utility of the inventions, but it had not been created to solve any particular problem.  Dr Thaler also submitted that neither the Patents Act 1977 (the "1977 Act") nor the European Patent Convention restricted inventorship to natural persons and an invention created by a machine should be owned by the owner of the machine. He argued that failure to do so would lead to natural persons who had not significantly contributed to the art being wrongly ascribed inventorship for creations made by AI systems.

The UK Patent Office responded to these contentions by saying that the naming of a machine as an inventor did not meet the requirements of the 1977 Act and that a natural person must be identified as the inventor. Dr Thaler was not satisfied with the response and requested a hearing on the matter, which was held before Mr Huw Jones on behalf of the Comptroller. Mr Jones determined that DABUS is not a natural person and could not be regarded as an inventor for the purposes of the 1977 Act. Mr Jones also stated that, in any event, as DABUS was not capable of owning property, it was also not possible for DABUS to assign any rights it may have to Dr Thaler.

Dr Thaler appealed the decision of the UK Patent Office to the English High Court.  On 21 September 2020, Marcus Smith J handed down his decision dismissing Dr Thaler's appeal.  On 4 December 2020, Floyd LJ granted Dr Thaler permission to appeal the High Court's decision to the Court of Appeal on the basis that the case raises important principles and the decisions had already attracted a degree of international interest.

In this article, we consider the decision of Marcus Smith J in further detail as it may foreshadow the likely arguments before the Court of Appeal. 

Dr Thaler's grounds of appeal in the High Court

Dr Thaler sought to appeal the UK Patent Office's decision on the following three grounds:

1. Mr Jones had prejudged the outcome based on the language of the IPO's Formalities Manual (which states that an AI inventor is "not acceptable");

2. Mr Jones had "'incorrectly focussed' on the inventor's motivation to innovate and disclose"; and

3. s.13(2) of the 1977 Act (which allows the Comptroller to deem a patent application to be withdrawn if an inventor does not set out the position on inventorship and entitlement), had been wrongly used to deny Dr Thaler a right under the 1977 Act, on the basis that s.13(2) should only be applied in situations where no statement of ownership is provided and should not be used to reject statements of ownership that are honestly provided by an applicant.

The IPO responded by stating that Mr Jones had correctly interpreted the 1977 Act as it currently stands and any significant changes in legislation about what the law should be, should be decided by Parliament and not incorporated into current legislation in a piecemeal way.

The High Court's decision

The Judge dismissed the first two grounds of appeal fairly swiftly - the first on the basis that he considered that the wording of the IPO's Formalities Manual had not unduly fettered Mr Jones' decision, and the second because Mr Jones was merely testing the practical implications of a particular statutory construction.

The final ground, about the interpretation of s.13 of the 1977 Act and its interplay with s.7 of the 1977 Act, was the focus of the decision.  Mr Justice Marcus Smith referred to the case of Yeda Research and Development Company Ltd v Rhone-Poulenc Rorer International Holdings [2007] UKHL 43 where the House of Lords expressed the view that s.7 of the 1977 Act contained an exhaustive code for determining who was entitled to be granted a patent.  Therefore, s.7 was the correct starting point and the Judge turned to consider whether Dr Thaler could bring himself within the scope of s.7 of the 1977 Act.

S.7(2) sets out the classes of person to whom a patent may be granted: s.7(2)(a) refers to the actual inventor(s) (or deviser(s)) of the patent, whilst s.7(2)(b) and s.7(2)(c) lists persons to whom a right to be granted a patent may be transferred. The Judge held that Dr Thaler failed on s.7(2)(a) as whilst it was possible for the definition of an inventor to be stretched, in theory, to extend to both persons and things, he rejected that this was how the term should be construed under the 1977 Act.  S.130(1) of the 1977 Act defines "inventor" as the "actual deviser of the invention" and this implied "someone devising something".  The Judge also referred to Yeda in which Lord Hoffman went further and referred to the inventor as a natural person who came up with the inventive concept. The provisions in the 1977 Act regarding inventive step and employee inventions also supported the view that inventive concepts arise from the mind of a natural person.  The Judge concluded that DABUS could not be an inventor within the meaning of the 1977 Act as DABUS was not a person.

The Judge then examined whether Dr Thaler could fall within s.7(2)(b) or s.7(2)(c) of the 1977 Act and held that, DABUS, by reason of its status as a thing and not a person, would be incapable of transferring property as it could not hold property itself, so it could not transfer any rights to be granted a patent to Dr Thaler under these sections.

The Judge left it open for owners/controllers of other AI systems to argue that they should be named as inventors on patents for inventions devised by their AI systems.  Dr Thaler expressly declined to advance this submission, but the Judge observed that he did not regard this to be an "improper" argument.  We wait to see what the Court of Appeal makes of this argument. 

Impact

This decision upholds the decision of the UK Patent Office and mirrors decisions taken by other patent offices worldwide, such as the EPO and USPTO.  The Court of Appeal acknowledged this international interest and the important principles raised by this case in its order granting Dr Thaler permission to appeal the UK Patent Office's decision a second time, to the Court of Appeal.  It will be interesting to see whether the Court of Appeal agrees that owners/controllers of AI systems should be entitled to argue that they devised inventions created by their AI systems and should be named as inventors on any patents.

The questions raised in this case form part of the wider debate as to the future of AI and IP policy. On 30 November 2020, the UKIP Office closed its consultation asking 43 questions, spanning a range of IP rights, on the implications of AI on IP law and practice. A number of the patent questions directly referred to the DABUS case and asked for industry input, as to what extent current AI systems can devise inventions and whether the inability to list an AI system as an inventor would discourage future inventions from being protected by patents. The other questions touched on topics such as the patentability of AI inventions and disclosure, demonstrating the impact that AI may have on other areas of patent law.  The UK IP Office's consultation report is awaited.

The UK consultation is occurring against the backdrop of wider discussions on the impact of AI on intellectual property - the World IP Office has been facilitating discussions with representatives of member states, as well as academic, scientific and private organisations (for example, see here), the US Patent Office published a lengthy report following its own comprehensive consultation and the EU Commission published its own report on the challenges of AI on the Intellectual Property Rights Framework.  The DABUS case is only the start of the international debate on this topic.