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European IP Bulletin, Issue 21, April - Patents
Patents
6. EU Ministers Endorse Proposal For a Directive on Computer-Implemented Inventions
In the European Council, EU ministers have recently reached a forward “common position” endorsing the proposal for a Computer Implemented Inventions Directive. The Directive’s aims are to harmonise the interpretation of the European Patent Convention and to codify practice and jurisprudence regarding the treatment of computer patent applications. The positive Council decision, on the text proposed by the Commission seems prudent in the sense that the text rejects the very controversial, if not unworkable amendments proposed by the European Parliament during the first reading. According to the “co-decision” procedure, the approval of the European Parliament is now required for the formal adoption of new Directive.
However, contrasts between the Council and the Parliament remain. The proposal was widely mis-reported as providing a wider legitimacy for the patenting of computer software. Moreover, Denmark, Poland and Portugal had requested the Commission to change it radically, according to Article 55 of the Parliament’s internal rules of procedure, but the Commission refused to reformulate the proposal because in fact it does no more than codify the status quo. Charlie McCreevy, European Commissioner for Internal Market and Services, explained in his Statement to the Parliament that the Commission endorsed the European Council’s common position “primarily for institutional reasons”. In fact, in May 2004, the Council reached a political agreement and the Commission expressed its support for that agreement. Consequently, the latter found itself in a position that would not allow any change to the proposal, because the Council was about to formalise its position. The Commissioner also affirmed that this stand was required in order to avoid “a logjam in an area which is key for innovation”. However, he also recognised that the Parliament considered that its views were not taken into account in the first reading and stated that in the case the Directive were rejected he will not propose a new one.
To conclude, the rift between the Parliament and the “common position” adopted by the Council remains especially on sensitive issues like the definition of “technical contribution”, disclosure, inter-operability, formats for claims, and safe guarding the interests of Small Medium Enterprises. In fact, the Parliament supports the introduction of broad exclusions which would damage the interests of Small Medium Enterprises by precluding protection for any invention holding data in one form or another.
Commissioner
McCreevy tried to reassure the Parliament, underlining that the Directive does
not broaden in any way the scope of computer patents, and that
business methods and computer programs “as such” will remain excluded. He also pointed out that the proposal
will bring uniformity in the EU and a clear differentiation will remain with
respect to the US model, because the expression of technical features in a
patent claim is required. Until this is finally settled, there remains a real
risk that the Parliament’s more controversial amendments may get into the final
text.
7. Best Before’ Entitlement to Patents
On 22 March 2005, the English Court delivered its decision on the
appeal from the Chancery Division in Markem Corp. v Zipher Ltd,
[2005] EWCA Civ 267.
The dispute related to a patent for thermal printers which printed
“best before” on foodstuffs. The invention was made by former
employees of Markem who moved to Zipher. While it was not claimed
that they did anything wrong or unlawful in their work at Zipher, or
in applying for the patent, the issue was whether Markem was
entitled to some of Zipher’s patent claims.
At first instance, in declining to believe the employees’ evidence
as to the making of the invention, the Court held that various
claims of the patents belonged to Markem and/or Zipher. The issues
on appeal were:
- whether the Judge was entitled to make adverse findings
about the truthfulness of the witnesses;
the extent to which section 7 of the 1977 Patent Acts gave rise to any claim for entitlement under section 8; - whether a claim-by-claim approach is within the meaning of section 8; and
- whether further proceedings under breach of confidence would be considered an abuse of process
On the first issue, the trial Judge was found to have erred in
making adverse findings in relation to the witness. The court of
appeal said that because the witness was not cross-examined, his
statement should have been assumed as trustworthy on the ground of
procedural fairness. In addition, the reasons given by the trial
Judge were questioned, namely the scope of the claims should not
have been linked with input based on some information passed at
Markem, but as common practice in patent drafting.
The court also held that section 7 does not create an entitlement
claim under section 8. Therefore, to have an entitlement claim it
was not enough to assert that the concept was known to its
employees. Rather, for such claim, other reasons of law are required
such as breach of contract, breach of confidence or the like.
Thirdly, it was held that the term ‘invention’ under section 8
should be interpreted broadly. Entitlement issues can arise before
any claims even exist. It is the identification of information and
the rights in it that matter at this stage. Therefore, a
claim-by-claim approach was not appropriate under the Act.
Finally, the court said that Markem was under an obligation either
to pursue the issue of breach of confidence or to abandon it. Claims
for breach of confidence after the trial of the entitlement
proceedings were held to be an abuse of process and were struck out.
Zipher’s appeal was allowed and all cross-appeals were dismissed.
This case gives rise to several practical issues:
- A witness must be cross-examined before his or her evidence can be dismissed.
- Entitlement imports the notion of title. It is the right to apply for a property title, and it can only be opposed on issues of lawfulness of the application such as a breach of contract law or confidence. The identification of the inventor is of no relevance at this stage, especially as the European Patent regime is a first-to-file system.
- Employees’ invention ownership is still a problematic issue. Even if an employee is not in breach of contract or confidence, he or she may still carry information that is the property of his or her former employer. Although, it was not the case here as it was held that the inventive concept was devised afterward.
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