Comparing the US and European Patent Systems

Introduction

Difference in US and European Patent System.

2.1 Authoritative Institutions and their effect on jurisdictional protection

2.2 Non-Patentable Inventions and Patentability Requirements

2.2.1 Patentability of Software Technology

2.3 Publicly Disclosed Inventions and Publication of Patent Application

2.4 Patent Application Requirements and Drafting patent Claims

2.5 Rights Conferred after grant of the patent

Conclusion.

Introduction

The advent of modern technologies such as electric mobility, artificial intelligence, the Metaverse, NFTs (Non-fungible token), cloud computing, geotargeting, and assistive technology is clear proof of the scientific innovations and developments occurring all across the globe.

Intellectual property rights, especially patents, have become significantly one of the most indispensable tools for any innovator to protect their invention and leverage it as per their interests in this age of technological development. According to the WIPO World IP Indicators 2021 Report, there was a surge of 1.6% patent applications as recorded.

Patents provide the owner with an exclusive limited monopoly over the patented invention according to the various national and international laws. Patents are however territorial in nature, that is, a particular patent protects the invention only within the country granting it and its grant is regulated according to the national patent system of that country.

Numerous international treaties and conventions (such as the Patent Cooperation Treaty) provide a harmonious method for filing patent applications in many countries at once.

In this article, we shall look into the differences and similarities in two of the most prominent patent systems of the world namely, the United States and the European Union who are among the top five jurisdictions wherein patent protection is sought.

The Major Differences between the US and European Patent System

2.1 Authoritative Institutions and their effect on jurisdictional protection

It is cardinal for every applicant to understand the correct forum and its jurisdictional extent before filing the patent application irrespective of the targeted country. Thus, the first difference discussed herein is the respective authoritative institutions for the grant of patents in the two said jurisdictions and the territorial extent of protection. Generally, a patent office receives applications and subsequently examines them according to the patentability criteria of the country, publishes them in the respective national journals, and collects the renewal fees as per the country’s patent law.

The United States Patent and Trademark Office (USPTO), a federal agency, has been established for managing its patent and trademark filings with its headquarters in Virginia. There is a uniform patent system in the United States and any patent granted by the USPTO operates throughout the US.

The USPTO provides for online filing of the patent application along with fee details, a comprehensive database for prior art searches, and application assistance apart from basic information regarding the US patent law. Recently, the USPTO launched a new Patent Public Search Tool that offers a more convenient, remote, and full-text-based searching of all US patents both granted and published applications.

On the other hand, the European Patent System is guided by the European Patent Convention (1973) that provides for a harmonious and easier procedure for filing patent applications in the member countries of Europe that includes the member states of the European Union and some non- EU countries as well.

Currently, there are 38 contracting parties to the European Patent Convention (EPC). Further, there are two extension states namely (1) Bosnia and Herzegovina and (2) Montenegro. Furthermore, there are four validation states with agreements in force, the states are (1) Cambodia (2) Republic of Moldova (3) Morocco, and (4) Tunisia. Georgia is one validation state with agreement but it’s not in force. For grant of patent in the remaining countries of Europe other international treaties such as the Paris Convention, Patent Cooperation Treaty can be utilized or the applicant can file in each of the remaining countries individually with the help of a local patent attorney.

Article 4 of the European Patent Convention establishes the European Patent Organization headquartered in Munich, is composed of the European Patent Office and Administrative Council. The said article expressly confers the power to grant patents on the Organization. The European Patent Office shall be established in Munich, Hague, and other countries as deemed necessary. The European Patent Office provides the procedure for online filing of the patent application, fee details, and a prior art search database called “Espacenet”. Article 3 of the European Patent Convention titled “Territorial Effect”, states that one or more contracting States may be requested for the grant of the European Patent.

2.2 Non-Patentable Inventions and Patentability Requirements

Every country has its own national patent law expressly providing the essential criteria for patentability and non-patentable inventions. Knowing the intricate details of the targeted country’s patent law is imperative to filing the application, because drafting of claims while filing varies for each country according to its law. In general parlance, inventions that are novel, involve an inventive step and are capable of industrial application are patentable. Let’s now discuss in detail what the United States and EPC law provides regarding this concept.

The United States patent law provides for three kinds of patents namely, utility patents, design patents and plant patents. Our focus of the study is utility patents.

35 U.S Code §100(a) expressly provides that “invention” means invention or discovery. This very definition gives us the idea that the United States has a very liberal and broad acceptance of what constitutes an invention.

On a combined reading of 35 U.S Code §100 and §101, there are four essentials for patentability in the United States-

Statutory subject matter- There are four subject matters under the law namely, process, machines, articles of manufacture, and compositions of matter. Books, music, abstract ideas, data structures are some examples of non-statutory subject matters as per US law.
New invention– Public knowledge of the invention, descriptive printed publication of the invention, and granted or published patent applications describing the invention before filing of the application negates the novelty of that invention. However, the United States patent law provides for a grace period of one year stating that if the invention in question has been patented or described in a printed publication anywhere in the world (including the US) or was in public use or on sale in the US for more than one year before the filing of the application then the novelty shall be adversely affected.
Useful invention (utility) – The aspect of “capable of industrial application” has been enshrined in this utility principle adopted by the US patent law which essentially categorizes “utility patents” separate from the other types. The utility can be practical utility, beneficial utility, or operability.

Brenner v. Manson

This landmark judgment on the utility principle established that a process patent wherein there is no identified use or whose use has not been sufficiently defined will be held to lack utility. There must be a claim of specific utility for process patents and general use such as use in research purposes will not suffice. Furthermore, the utility of the end product formed from the process in question shall be decisive for the utility of the process, irrespective of whether the end product is novel/inventive in itself.
Non-obvious invention- The bar of non-obviousness is subject to whether the invention has an inventive step and whether it is obvious to a person with ordinary skill in art. However, the US patent law expressly mentions that the patentability of any invention will not be adversely affected by the mode in which the invention was made.

KSR International Co. v. Teleflex, Inc.

Mosaicing or combining of different resources available in public for the examination of non-obviousness was discussed in this case. The US Supreme Court established that if such a practice results in predictable outcomes, it is reasonable to combine the used references.
Regarding non-patentable inventions, it is pertinent to note that the United States patent law is one of the most broad in terms of accepted patentable inventions. In fact, as early as 1980s’ the United States had developed the principle that “Anything under the sun made by man” is patentable. Where patent laws of most jurisdictions clearly define non-patentable inventions, the United States patent law only gives a one line liberal approach under 35 U.S.C. 101 titled “Inventions patentable”

Diamond v. Chakrabarty

A landmark judgment discussing patentability of biotechnological patents in the United States and one of the cases wherein it was observed that the “Congress intended statutory subject matter to include anything under the sun that is made by man.”
In this case, the respondent had filed a patent application wherein the invention was a human made genetically modified bacteria having the novel ability of breaking down crude oil not naturally present in any other naturally occurring bacteria. However, the claims regarding the new bacteria were rejected on the ground that “living organisms” are not statutory subject matter as provided in 35 U.S.C. 100.

However, it was held that human made microorganisms very much fall under 35 U.S.C. 100 as they constitute “manufacture” or “composition of matter” within this section. The term “any” within this section proves that the Congress intended to give wider meaning and scope to the patent law. Only natural laws, physical phenomena, and abstract ideas are excluded from patentability.

In contrast, the European Patent Convention under its Article 52 establishes four criteria for patentability, vis-a-vis, it must be an invention belonging to any field of technology, it must be susceptible to industrial application, it must be new, and involve an inventive step.

The “susceptible to industrial applicability” requirement though analogous to the “utility” principle under the US patent law is different in scope and interpretation.

Article 52(2) expressly prohibits the following from the ambit of “invention” for the purpose of patent grants-

Scientific theories, discoveries, mathematical methods
Aesthetic creations
Methods, schemes, rules for performing mental acts, playing a game, doing business, and programs for computer
Presentation of information

Further, unlike the United States patent law, the European Patent Convention establishes three exceptions to patentability –

Inventions whose commercial exploitation would be contrary to public order and morality. However, commercial exploitation will not be considered to be contrary merely on the ground that it is prohibited by laws in some or all of the member countries of Europe.
Inventions that relate to plant or animal varieties, biological processes for production of them. However, this exception does not apply to microbiological processes or their products.
Inventions concerning the treatment methods such as surgery, therapy, diagnosis of the human and animal body. However, products, especially particular substances, used for any of these methods are not included within this exception.

Copolymers/Dupont, T124/87, OJ 1989 (1988)

In this case, the European Patent Office Boards of Appeal denied the patentability of a category of compounds on the ground that they were not novel and lacked an inventive step. It was held that “If a prior document describes a process for the production of a class of compounds, the members of the class being defined as having any combination of values of particular parameters within numerical ranges for each of those parameters, and if all the members of the defined class of compounds can be prepared by a skilled person following such teaching, all such members are thereby made available to the public and form part of the state of the art.”

Georges, Bradford John vs. Robert Pettit

In this landmark judgment, the Court explained that a particular subject matter is excluded from patentability if it makes no contribution to the art in a field which is not excluded from patentability under the EPC. The contribution in the field could be in the form of a problem to be solved, in the solution of the problem, or in the effects achieved. Further, given that the list of non-patentable inventions under the EPC is not an exhaustive list, the requirement for contribution as mentioned above is generally equated with the requirement for a “technical contribution”.

E.I. du Pont de Nemours & Co.

In this case, an invention related to cosmetic process was denied patent for the want of fulfillment of the “susceptible to industrial application” requirement under the European Patent Convention. However, the Court granted the patent to the invention stating that it did comply with Article 57 as it could be utilized by companies whose aim is to beautify human/animal bodies and such companies do fall under the ambit of “industry”.

2.2.1 Patentability of Software Technology

Inventions in the field of computer software, artificial intelligence have increased many folds over the last years. The patentability of these inventions is always a mystery and most often varies from case to case.
In earlier times, even the United States patent offices were reluctant to grant patents to software technologies. In Gottschalk v. Benson, US Supreme Court stated that software was substantially mathematical formulae, thereby being nothing more than abstract ideas, and thus not patentable, as it was just a mere algorithm without any practical/industrial application.
However, later in Diamond v. Diehr, the US had started to adopt a broad approach towards patents and held that merely on the ground that the claims contain mathematical formulae it won’t be denied.

Finally, one of the landmark judgments that provided clarity on patents relating to computer programs and software in the US came in 2014, Alice Corp. v. Cls Bank that established a two part test of patentability. Firstly, the court must determine whether the claimed invention relates to an abstract idea and secondly, if it does, then the court must consider whether the other components of the claims form a patent eligible concept.

Applying this two part test, in Uniloc USA, Inc. v. LG Electronics USA, Inc.(one of the recent 2020 cases), software patent claims were held eligible and reconfirmed that by overcoming a problem arising in computer networks makes the invention patent eligible.
Depending on how the claims in the patent application have been drafted, a software invention could now easily fall into one of the subject matters provided in the US patent law such as, a claim for software per se which has been presented as a process that would be eligible. Thus, if an abstract idea is claimed in the United States, it must be annexed to practical application.

The European Patent Office, on the other hand, requires a stricter “technical effect” when it comes to software inventions. We have noted previously that the European Patent Convention provides for certain inventions which are excluded from patentability including programs of the computer. However, these are not considered non-patentable under all cases and many precedents have been laid down wherein patentable subject matter has been distinguished from subject matter excluded “as such”. Thus, only computer programs “as such” would be excluded. Software related inventions have been called “computer implemented inventions (CII).

The EPO firstly determines whether the said invention specifies any technical use because this is the first ground of patentability. Subsequently, the EPO determines the novelty of the invention.

Lastly, it will examine if the distinguishing features of the claimed invention contribute to the technical effect and the same are inventive over the prior state of the art available. One of the best examples of patent eligible software technology is the modern washing machines which use a combination of hardware and software instead of traditional mechanical controls.

In fact, the European Patent Office had recently released a new directive “Artificial Intelligence and Machine Learning” that assigns calculation models and algorithms to inventions in these fields. The directive mandates that it must be proved that the invention produces a technical effect thereby serving a technical purpose. Thus, while drafting a patent application for such an invention, all essential technical features must be properly included.

In re Vicom Sys., Inc.

In this landmark judgment it was established that even if the idea elementary to the invention falls under any excluded matter under Article 52, the invention may still be patentable if it has a technical effect/use/process up to the extent not forming a part of excluded subject matter.

In another case, it was held that optimization of business methods, that is essentially a non-technical process being implemented on the computer, is not patentable. However, if this process contains technical considerations on the internal functioning of the computer, it may be patentable. The decision for such cases is based on a specific technical effect produced through the execution of the program.

2.3 Publicly Disclosed Inventions and Publication of Patent Application

The United States patent law and the European Patent Convention have different views on publicly disclosed inventions and their effect on novelty.

Under the US patent law, an invention can lose its novelty if it is-

Known/used by others in the US
Patented pr described in a printed publication anywhere in the world
Used publicly or on sale in the US

However, a grace period of one year is provided under the US law and so if the inventor does any of the above mentioned acts he would still be eligible to file for a patent.

On the other hand, under the European Patent Convention there is no such provision of a grace period. Everything available to the public in written or oral form, through use, or any other way before the filing of patent forms state of the art under the EPC and negates novelty.

So, essentially if an inventor publicly discloses his invention he might still get a patent in the US within one year but will not get a patent granted under the EPC.

Publication of the patent application is a procedural step after filing of the patent invention and has no relation to the above explained “publicly disclosed” invention. The publication of the patent application is necessary to intimate third parties of the application.

Up until 2001, patent applications were published in the United States only after the patent had been granted. Now, the patent application gets published promptly after 18 months (or earlier if requested by the applicant) from the earliest filing date.

However, one peculiar exception has been provided under the US law regarding the publication of patent applications. When an applicant certifies that his invention has not and will not be the subject matter of a patent application filed in any other country (other than the United States) or under any multilateral agreement wherein the publication of application occurs within 18 months, and further requests that his application should not be published, it will not be so published. Such a request of non-publication can be rescinded anytime by the applicant.

The European Patent Office, on the other hand, publishes the patent application as soon as possible either after the expiry of 18 months from filing or earlier if requested by the applicant. Further, the application has to be published at the same time as the specification of the European patent when the decision to grant the patent becomes effective before the expiry of the period referred to above.

Under both the laws, a patent application does not get published if it has been withdrawn.

2.4 Patent Application Requirements and Drafting patent Claims

Drafting a patent application and the necessary documents required for filing the application in the USPTO and the EPO requires very different approaches. Both the offices now follow the first-to-file system after the Leahy-Smith America Invents Act came into effect in the United States in 2013.

An applicant can file either a provisional or non-provisional patent application for a patent in the United States. However, a provisional application is automatically abandoned after 12 months of its filing. Only a non-provisional application is examined in the United States and most applicants file that only directly. A non-provisional application can be filed at the USPTO through EFS-Web (online filing system), mail, or hand delivery at the office in Virginia. However, an additional fee of $400 ( $200 for a small entity or micro entity status applicant) is charged when the EFS-Web is not used, that is when the application is not filed electronically.

Application requirements for a non-provisional application are-

Utility Patent Application Transmittal Form
Fee Transmittal Form– For a non-provisional patent application, the basic filing, search, and examination fees are due at filing for all applicants. Excess claims fees and application size fees may also be due if certain limits are exceeded.
Application Data Sheet– It is a form that lists bibliographic data including inventor information, applicant information, correspondence address, application, domestic benefit, foreign priority, and assignee information. This form can also be used to request that the application not be published.
Small and Micro Entity Status (if applicable) on the basis of gross income or higher education.
Specification – The specification must be in clear, full, concise, and exact terms to enable any person skilled in the art or science to which the invention pertains to make and use the same.
The Inventor’s Oath or Declaration – An oath must be sworn to by the inventor before a notary public. A declaration may be submitted instead of an oath. A declaration does not need to be notarized.
Translation of the application in English if it is in any other foreign language, a statement that the translation is accurate, and an additional fee.
Before the Leahy-Smith America Invents Act, it was mandatory to include the best way to practice the invention in the patent application, but now this is a formal requirement only and would not invalidate the application.Under the EPO in contrast, there is no such requirement. Further, in addition to English, the official languages of the European Patent Office also include French and German. Other formal requirements of a patent application under the EPC are–
1. Request for grant of patent
2. Description of the invention- The invention must be disclosed in a manner sufficiently clear and complete for it to be performed by a person skilled in the art.
3. Claims and drawings (if applicable)
4. Abstract
Apart from these, other documents such as the designation of the inventor, request for accelerated prosecution, request for participation in patent prosecution highway, priority documents, declaration for SMEs, etc. are also needed. Further, no amendments to the description, claims, or drawings are allowed after the application has been filed. For an EPC patent application, claims must be drafted in a manner that defines the invention in terms of its technical features. The claims should consist of two parts comprising of a-
1. Prior art portion
2. Characterizing portion

In the first claim and all other independent claims, the prior art portion should designate the subject-matter of the invention and the technical features which are needed to define it but which, in combination, form part of the prior art. The characterizing portion should state the technical features for which protection is sought in combination with the features in the prior art portion. Pertaining to this idea many a times the examiners from the patent office ask the patent applicant to characterize the independent claim during prosecution stage of the patent application.

Further, an independent claim must state all the essential features of the invention and the application may not contain more than one independent claim in the same category.

Each independent claim may be followed by one or more “dependent” claims concerning particular embodiments of the invention.

The scope defined by the claims must be as precise as the invention allows. As a general rule, claims that attempt to define the invention in terms of the result to be achieved are not allowed. Furthermore, references to the description or drawings, particularly in the form of “as described in part … of the description” or “as illustrated in figure … of the drawings”, are not allowed unless they are absolutely indispensable.

Also, a claims fee is charged for each additional claim after the 15th claim. The claims fee becomes higher after the 50th claim. If the application has several sets of claims, then the fee is payable for each claim beyond the 15th in the set that contains the highest number of claims.

In contrast, drafting of claims for a US patent application does not involve this two-part system and multiplicity of independent claims is also allowed. If the “two-part” system is used in the US, anything written before the characterizing portion is deemed to be prior art. Thus, even if this portion had any novel feature it will be regarded as prior art and adversely affect the patentability.

Further, in US applications, the dependent claims refer to only one main claim and multiple dependent claims are often avoided as they are subject to extra fees.

The “means plus function” method used while drafting claims is generally used in an EPC application and covers all the ways of performing the said function. But in a US application this method has restricted scope and is only limited to specific disclosures in the specification

Lastly, in the US, an extra fee is charged for each additional claim after the 20th claim or if there are more than three independent claims.

2.5 Rights Conferred after grant of the patent

The end goal of each applicant applying for a patent anywhere in the world is the rights he is entitled to after the patent is granted.

When a patent is granted by the USPTO, the patentee is entitled to complete protection rights and commercialization rights to his invention in all of the United States. The patent owner can enjoy full patent rights and make sure that none can manufacture, market, or make use of the invention in the USA without prior approval.

In the United States, there was no system for opposition in a strict sense until 2011. The Leahy-Smith America Invents Act established the option for challenging the patent validity known as “post grant review”. This is a time bound inter parties review mechanism. The time period of nine months after the grant of patent is provided for filing a petition for post grant review.

Prior to this Act, a third party could challenge the validity of the patent by filing for an ex-parte reexamination(EPR), wherein he was not a part of the proceedings other than filing his petition and reply to the patent owner. Later, in 2000 another procedure was established called “inter partes reexamination” which permitted more participation of the challenging party. This “inter partes reexamination” has been replaced with “Inter partes review (IPR)” proceedings.

Unlike EPRs and IPRs, a post grant review must be filed within 9 months after the issuance of a patent, so a decision to file a PGR needs to be made promptly after a patent issue.

A post grant review petition can be filed on the ground of non-eligible subject matter, anticipation, obviousness, lack of sufficient description, etc. But an inter parte review can be based on only two grounds, that is, anticipation and obviousness and is limited to only patents and printed publications.

On the other hand, as discussed above, the European Patent Convention has 38 member countries. A European patent confers rights on the proprietor from the date of publication in the

European Patent Bulletin, in each Contracting State where patent has been granted same rights as would be conferred by national patent granted in that country. Any infringement of a European patent is dealt with by national law.

The right to a European patent belongs to the inventor or his successor in title. If the inventor is an employee, the right to a European patent is determined in accordance with the law of the State in which the employee is mainly employed. If two or more persons have made an invention independently of each other, the right to a European patent will belong to the person whose European patent application has the earliest date of filing, provided that this first application has been published.

Opposition can be filed to the European Patent Office by any third party against the granted patent within nine months from date of issue of patent. Such opposition will apply to the European patent in all the member countries in which the patent has effect.

Opposition under the European Patent Convention can be filed on the ground that subject matter is non-patentable, disclosure is not clear and complete to be carried out by a person skilled in art, subject matter extends beyond the content of the application, etc.

Conclusion

These major differences in patent applications, patentability criteria, non-patentable inventions, rights conferred, etc play a major role in shaping the right strategy before seeking patent protection in the United States and Europe. Patents often require a lot of monetary investments and many times the inventor might have to choose between the two jurisdictions. In such a scenario, understanding these differences becomes very crucial. Right from understanding both the process regarding software inventions and inventive concept to how to draft the patent claims, it requires a lot of experience and homework on the invention

However, there also occur certain similarities between the two. The term of protection granted in both the jurisdictions in 20 years. Further, in 2013 the USPTO had shifted from the United States Patent Classification (USPC) to the Cooperative Patent Classification System (CPC) which is a jointly developed system with the European Patent Office.

Comparing these differences and similarities can leverage any company’s growth and commercialization using their invention in the United States and Europe.

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