Open Sesame! (part 2)

This is the second part of Aujain Eghbali’s walk-through post on the Sesame decision on business methods.

In the first part, Aujain demonstrated that the Paris Cour d’appel confirmed the refusal of Sesame’s application by applying the same general principles as those relied upon by the EPO.

As he is a man of paradox, he will now show us that the French judges did in fact not use an EPO-compliant approach in their ruling.

Here is to him.

First, a few words on the EPO-compliant approach.

The EPO nowadays almost systematically rejects business method software claims on the ground of a lack of inventive step.

Art. 52 EPC provides:

(1) European patents shall be granted for any inventions, in all fields of technology, provided that they are new, involve an inventive step and are susceptible of industrial application.

(2) The following in particular shall not be regarded as inventions within the meaning of paragraph 1:(…)(c) schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers;(…).

(3) Paragraph 2 shall exclude the patentability of the subject-matter or activities referred to therein only to the extent to which a European patent application or European patent relates to such subject-matter or activities as such.

The Boards of appeal wanted to clear all debates on the interpretation of the expression “as such” in the Convention. Furthermore, they departed from the so-called “contribution approach”, and came to consider that the exclusion of subject-matter under Art. 52(2) EPC had to be determined without any knowledge of the prior art. As a result, the established case law is now that any tangible element or tangible action in a claim qualifies as a technical feature and allows the claimed subject-matter to pass the hurdle of Art. 52(2) EPC.

Any patentability issues related to the non-technical aspects of a claimed subject-matter are then addressed within the assessment of inventive step.

This is explained in landmark decision T 258/03 (Auction method/HITACHI):

4.6. The Board is aware that its comparatively broad interpretation of the term “invention” in Article 52(1) EPC will include activities which are so familiar that their technical character tends to be overlooked, such as the act of writing using pen and paper. Needless to say, however, this does not imply that all methods involving the use of technical means are patentable. They still have to be new, represent a non-obvious technical solution to a technical problem, and be susceptible of industrial application.

Another landmark decision T 641/00 (Two identities/COMVIK) established the framework for assessing inventive step of a claimed subject-matter consisting of a mixture of technical and non-technical features (“mixed-type claims”): all features which contribute to said technical character should be taken into account, whereas features making no such contribution cannot support the presence of an inventive step.

The reasoning is basically a three-step process:

a. What is the technical character?

b. Which features contribute to the technical character?

c. Do these features (and these features only) form a non-obvious technical solution to a technical problem with respect to the prior art?

When the EPO believes that a claim relates to a mere automation of a business method, as the Cour d’appel considered in Sesame, the answers to these three questions are the following:

a. Automation of human and business activities (in this case related to haulage).

b. A system with hardware and data structuring and communication capabilities.

c. No, because the hardware and the data structuring and communication capabilities are conventional. (This last assertion can possibly be held merely on the basis of common knowledge.)

Thus, the reasoning leads to a finding of lack of inventive step for business method software claims.

It seems that French judges do not want to bother with such theoretical and complex legal reasoning. For instance, as already reported on this blog, the Paris Tribunal de grande instance recently held that a claim directed to a “storage medium storing [a computer program]” fell under the exclusion of computer programs as such – although the EPO would have given weight to the presence of the “storage medium” feature in the claim.

The Cour d’appel de Paris confirmed this stance in Sesame. It was held that, although a computer system is recited in the claims, the subject-matter was excluded from the scope of patentability under Art. L.611-10-2° of the Code de la propriété intellectuelle (that is, the equivalent of Art. 52(2) EPC). Said the Court:

The legislator was not concerned with the phrasing of the claims.

The spirit of the statutes is to exclude patentability of solutions that are not at a technical level but at a business level.

The director of the INPI should thus appreciate the existence of an invention without being bound by the wording used in the claims.

By proceeding in this way, he did not alienate the claims. 

It even seems that the judges did not consider the different invalidity grounds to be exclusive from one another. Indeed, the court additionally found that the claims were manifestly not novel:

It obviously results from [the fact that the invention is directed to a mere automation of a business method] that the claims do not call for any search as they manifestly lack novelty.

Sesame is also the name of a famous street.

Sesame is also the name of a famous street.

But there is certainly another (procedural) reason for the Court’s approach in the present case.

Under French law, the INPI does not assess inventive step in examination proceedings. The grounds under which the director of the INPI may refuse a patent application are listed in Art. L. 612-12 and lack of inventive step is not one of them. Lack of inventive step is only a ground for patent invalidation in an inter partes trial.

As a direct consequence, the INPI cannot, from a legal standpoint, follow the Comvik approach to refuse an application directed to a business method, when the claims incorporate tangible features. Such an application can only be refused under Art. L. 612-12 if:

  • it relates to subject-matter which can manifestly not be considered as an invention (exclusion from the scope of patentability), or
  • it has not been amended, after an invitation to do so, although the lack of novelty manifestly results from the search report.

In the Sesame case, the INPI retained the first solution and did not even conduct a prior art search, declaring that no relevant comparison with the prior art could be performed, as no technical features were claimed except for a very conventional computing system.

The Court not only approved but also considered that the explanations of the director of the INPI regarding the impossibility to establish a search report were “unnecessary”, as the actual ground for refusing the application was not the lack of novelty but the exclusion from the scope of patentability.

So, it is true that the INPI reached the same conclusion that the EPO probably would have reached, i.e. the invalidity of the haulage platform claims. But by relying on the ground of ineligibility, the INPI totally discarded the raison d’être of the Comvik approach.

In fact, the patentability assessment of mixed-type claims is often a complex question. This is probably why the EPO established the sophisticated Comvik approach.

This Comvik approach starts by determining the claim’s technical character and those features that contribute to said technical character. But the EPO is well-aware that these first steps of the reasoning are not always easy to conduct (see T 1749/06).

Therefore, one often has to perform the first steps with some knowledge of the prior art. The Comvik approach provides exactly for that, because non-technical aspects are assessed within the inventive step analysis.

This is explained in the EPO Guidelines for examination (G-VII, 5.1):

Determination of the features contributing to the technical character of the invention should be performed for all claim features in step (i) (T172/03, T154/04). However, in practice, due to the complexity of this task, the examiner can normally perform the determination in step (i) on a prima facie basis only and perform the analysis at the beginning of step (iii) in a more detailed manner. In step (iii), the technical effects achieved by the differences over the selected closest prior art are determined. The extent to which the differences contribute to the technical character of the invention is analysed in relation to these technical effects. This analysis, limited to the differences, can be performed in a more detailed manner and on a more concrete basis than the one performed at step (i). It may therefore reveal that some features considered in step (i) prima facie as not contributing to the technical character of the invention do, on closer inspection, make such a contribution. The reverse situation is also possible. In such cases, the selection of the closest prior art in step (ii) might need to be revised.

When performing the analysis in steps (i) and (iii) above, care should be taken to avoid missing any features that might contribute to the technical character of the claimed subject-matter, in particular if the examiner reproduces his understanding of the subject-matter of the claim in his own words during the analysis (T 756/06).

For that reason, EPO examiners nowadays often conduct a prior art search anyway, even when they are to refuse the application for a lack of any other technical contribution than a mere automation of a non-technical method. This is however not how the EPO examiner who was in charge of conducting the search on behalf of the INPI behaved in Sesame. Indeed, the EPO examiner did not issue a search report but rather declared that no meaningful search could be performed.

By allowing the INPI not to conduct any prior art search in such a case, the Sesame decision could be broadly construed as authorizing examiners to directly refuse applications when they are faced with mixed-type claims, based on their sole interpretation of the application.

Examiners could do so even in cases in which it is not so clear which features contribute to a technical character and which ones do not.

In the present case, the Cour d’appel held that both the absence of an invention and the lack of novelty were clear. However, looking at the decision in detail, it seems that a significant reasoning actually had to be conducted in order to reach such a conclusion.

Why is the INPI not entitled to refuse an application on the ground of lack of inventive step but only on the ground of the manifest absence of an invention or a manifest lack of novelty? One explanation is that the INPI is not supposed to rely on a subjective analysis to refuse an application. The law reserves the exercice of such subjectivity to litigation.

But the question of whether a business method software invention only relates to mere automation or implies further technical considerations is usually not an easy one which can be answered without any subjectivity. Even experts in that field cannot give an answer in a straightforward manner.

It is thus questionable that the INPI should suddenly be entitled to do so. The only explanation would be that granting a patent which is invalid because it merely relates to a business method is somehow worse than granting a patent which is invalid because it relates to a solution made obvious by a combination of two prior art teachings – for example from the standpoint of legal certainty. But the decision does not provide any hint in this respect.

We thus have to wait and see how INPI examiners will behave. It will notably be interesting to monitor if they rely on Sesame to refuse mixed-type claims on a regular basis. Also, it will be interesting to see how they behave in case the EPO conducts the search (instead of declaring it meaningless) and accompanies the search report with a written opinion where the ground of invalidity is… a lack of inventive step. Will the INPI bypass the reasoning of the EPO examiner and merely refer to Sesame?

Many thanks, Aujain. So, we are left with the question of whether Sesame has planted a seed at the INPI. If readers have any intel on this, comments are welcome as usual.


CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 2, February 26, 2016, Sesame Active System v. Directeur général de l’INPI, RG No. 15/01962.

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