CJEU ruled that Directive 2004/48/EC and Directive 2009/24/EC must be interpreted as meaning that the breach of a clause in a licence agreement for a computer program relating to the intellectual property rights falls within the concept of ‘infringement of intellectual property rights’ and therefore owner of copyright must be able to benefit from the guarantees provided for by that directive, regardless of the liability regime applicable under national law.

IT Development brought proceedings against Free Mobile before the Regional Court, Paris, France for infringement of the copyright of the ClickOnSite software package. IT Development alleged that Free Mobile had modified the software, in particular by creating new forms. In IT Development’s opinion Free Mobile did not have the right to make such modifications because the provisions of the licence agreement stated that the customer expressly undertakes not to modify, correct, adapt, create second works and add, directly or indirectly, to that software.

Regional Court of Paris declared the claims brought by IT Development based on Free Mobile’s tortious liability inadmissible. The court held that there are two separate sets of rules relating to liability in intellectual property matters, one being tortious liability in the event of infringement of the exploitation rights of the author of the software, as determined by law, the other being contractual liability in the event of infringement of a copyright reserved by contract, and that, in the present case, Free Mobile was clearly alleged to have failed to perform its contractual obligations, providing a basis for an action for contractual liability, and not for the tortious act of infringement of software copyright.

IT Development brought an appeal against that judgment before the Court of Appeal, Paris, France and  seeked a declaration that the modifications to the software made by Free Mobile constituted copyright infringements, for which Free Mobile should be ordered to pay IT Development the sum of EUR 1 440 000 as compensation for the damage suffered and, in the alternative, that Free Mobile should be ordered, on a contractual basis, to pay IT Development the sum of EUR 840 000 as compensation for that damage.

According to CJEU determination of the applicable liability regime  falls within the competence of the Member States. However, the application of a particular liability regime should in no way constitute an obstacle to the effective protection of the intellectual property rights of the owner of the copyright of that program as established by Directives 2004/48 and 2009/24. Further, the national court is required, to the greatest extent possible, to interpret national law in conformity with the requirements of EU law and to thus ensure, the full effectiveness of EU law when it determines the dispute before it.

In the light of all the foregoing, the Directives 2004/48 and 2009/24 must be interpreted as meaning that the breach of a clause in a licence agreement for a computer program relating to the intellectual property rights of the owner of the copyright of that program falls within the concept of ‘infringement of intellectual property rights’, within the meaning of Directive 2004/48, and that, therefore, that owner must be able to benefit from the guarantees provided for by that directive, regardless of the liability regime applicable under national law.

See the Judgement.

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• SAS Institute Inc. v World Programming Ltd, Case C‑406/10, Read More: Copyright can protect elements other than source and object code or in Wikipedia
• Nintendo v. PC Box, Case C-355/12, Read More at EU Law Blog
• The Czech government v.  BSA, Case C-393/09, Read More: European Court Rules on User Interface Copyright

The post Software Copyrights appeared first on Competum.

On a related note, the Commission also recently published recommendations for a better presentation of information to consumers (available here). These recommendations primarily apply to an online context where there is no direct physical interaction with the consumer.

The post Commission Guidance on Unfair Contract Terms appeared first on Competum.

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Some extracts of the case:

“On their face, the claims before us are drawn to the concept of intermediated settlement, i.e., the use of a third party to mitigate settlement risk. Like the risk hedging in Bilski, the concept of intermediated settlement is “ ‘a fundamental economic practice long prevalent in our system of commerce.’”

“…the mere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention. Stating an abstract idea “while adding the words ‘apply it’” is not enough for patent eligibility.”

“The representative method claim in this case recites the following steps: (1) “creating” shadow records for each counterparty to a transaction; (2) “obtaining” start-of-day balances based on the parties’ real-world accounts at exchange institutions; (3) “adjusting” the shadow records as transactions are entered, allowing only those transaction for which the parties have sufficient resources; and (4) issuing irrevocable end-of-day instructions to the exchange institutions to carry out the permitted transactions.”

“…the relevant question is whether the claims here do more than simply instruct the practitioner to implement the abstract idea of intermediated settlement on a generic computer. They do not.”

Read the full decision

Links and other Commentaries:

A Post-Alice Playbook: Practical Strategies for Responding to Alice-Based Rejections by Robert Plotkin, Esq.

The Supreme Court invalidates a software patent in Alice Corp. v. CLS Bank by Rob Tiller

Preliminary Examination Instructions for Determining Subject Matter Eligibility in view of Alice Corp. v. CLS Bank by The USPTO

The post Patenting Software in the U.S. does not reach to abstract ideas: Alice v CLS Bank appeared first on Competum.

Claim 1 recites: A device profile for describing properties of a device in a digital image reproduction system to capture, transform or render an image, said device profile comprising:

    first data for describing a device de-pendent transformation of color information content of the image to a device independent color space; and

    second data for describing a device de-pendent transformation of spatial in-formation content of the image in said device independent color space.

Court: “Claim 1 … recites an intangible arrangement of information, and therefore does not fall into any of the categories of § 101.” Further, claim 10 “recites a process of taking two data sets and combining them into a single data set, the device profile.”   “[w]ithout additional limitations, a process that employs mathematical algorithms to manipulate existing information to generate additional information is not patent eligible.”

• Read the Decision
• Commentary by Patent Docs

BUYSAFE, Inc. v. Google, Inc. Decided by Federal Circuit September 3, 2014

Claims for underwriting transactions over a computer network were ineligible under § 101. The creation of such financial relationships was an abstract idea and that the use of generic computing components such as a “computer application” or “computer networks” did not render that abstract idea patent-eligible.

Court stated e.g. “The claims’ invocation of computers adds no inventive concept. The computer functionality is generic—indeed, quite limited: a computer receives a request for a guarantee and transmits an offer of guarantee in return. There is no further detail. That a computer receives and sends the information over a network—with no further specification—is not even arguably inventive….At best, that narrowing is an “attempt[] to limit the use” of the abstract guarantee idea “to a particular technological environment,” which has long been held insufficient to save a claim in this context .

So what did Claim 1 actually state:

A method, comprising: receiving, by at least one computer application program running on a computer of a safe transaction service provider, a request from a first party for obtaining a transaction performance guaranty service with respect to an online commercial transaction following closing of the online commercial transaction;

processing, by at least one computer application program running on the safe transaction service provider computer, the request by underwriting the first party in order to provide the transaction performance guaranty service to the first party,

wherein the computer of the safe transaction service provider offers, via a computer network, the transaction performance guaranty service that binds a transaction performance guaranty to the online commercial transaction involving the first party to guarantee the performance of the first party following losing of the online commercial transaction.

• Read the Decision

Ultramercial, LLC v. Hulu, LLC, Decided by Federal Circuit November 14, 2014

In simplified terms, the Court characterized the invention as “a method for distributing copyrighted media products over the Internet where the consumer receives a copyrighted media product at no cost in exchange for viewing an advertisement, and the advertiser pays for the copyrighted content.”

The Court wrote e.g. that “[t]he process of receiving copyrighted media, selecting an ad, offering the media in exchange for watching the selected ad, displaying the ad, allowing the consumer access to the media, and receiving payment from the sponsor of the ad all describe an abstract idea, devoid of a concrete or tangible application.”

Court concluded also that “[a]dding routine additional steps such as updating an activity log, requiring a request from the consumer to view the ad, restrictions on public access, and use of the Internet does not transform an otherwise abstract idea into patent-eligible subject matter.”  The claim included only “conventional steps, specified at a high level of generality.”

• Read the Decision
• Commentary by Patent Docs

The post Post Alice Federal Circuit decisions related to Patenting software in the US appeared first on Competum.

XimpleWare has also made argument that Versata’s customers infringed XimpleWare’s patents by using the software, because GPLv2 does not grant a patent license-only a copyright license.

Links to further information:

Larry Rosen: A Case Study In Understanding (and Enforcing) the GPL

Lawsuit threatens to break new ground on the GPL and software licensing issues, by Aaron Williamson

Versata Can’t Dodge XimpleWare’s Software Copyright Suit By Beth Winegarner

The Versata case: Third party beneficiary possibly able to enforce copyleft obligation in state court

Documents available from RECAP’s docket reports for Versata v. Ameriprise and XimpleWare v. Versata.

The post Enforcing FOSS: XimpleWare vs. Versata, Ameriprise et. al. appeared first on Competum.

What made Myriad Composition claims patent-eligible

The principal claims of the patents relate to isolated DNA molecules. The isolated DNA molecules are not found in nature.  They are obtained in the laboratory and are man-made, the product of human ingenuity. While they are prepared from products of nature, so is every other composition of matter. But, as such, they are different from natural materials, even if they are ultimately derived from them. Isolated DNA is a tangible, man-made composition of matter.

Myriad’s claimed isolated DNAs exist in a distinctive chemical form from DNAs in the human body, i.e., native DNA.  Natural DNA exists in the body as one of forty-six large, contiguous DNA molecules.  Each of those DNA molecules is condensed and intertwined with various proteins to form a complex tertiary structure known as chromatin that makes up a larger structural complex, a chromosome. Isolated DNA, in contrast, is a free-standing portion of a larger, natural DNA molecule.  Isolated DNA has been cleaved or synthesized to consist of just a fraction of a naturally occurring DNA molecule.

The isolated DNAs of the present patents constitute a situation, where they are different from the natural products in “name, character, and use.”  In nature, the claimed isolated DNAs are covalently bonded to other materials.  Thus, when cleaved, an isolated DNA molecule is not a purified form of a natural material, but a distinct chemical entity that is obtained by human intervention.

Rejected Arguments

Invalid arguments by Plaintiffs: isolated DNAs retain the same nucleotide sequence as native DNAs

Plaintiffs argued that because the claimed isolated DNAs retain the same nucleotide sequence as native DNAs, they do not have any “markedly different” characteristics.  This approach, however, looks not at whether isolated DNAs are markedly different from naturally occurring DNAs, but at one similarity: the information content contained in isolated and native DNAs’ nucleotide sequences.

It is the distinctive nature of DNA molecules as isolated compositions of matter that determines their patent eligibility rather than their physiological use or benefit.  Patent eligibility of an isolated DNA is not negated because it has similar informational properties to a different, more complex natural material. The claimed isolated DNA molecules are distinct from their natural existence as portions of larger entities, and their informational content is irrelevant to that fact.  Genes are in fact materials having a chemical nature and, as such, are best described in patents by their structures rather than by their functions. In fact, many different materials may have the same function (e.g., aspirin, ibuprofen, and naproxen).

“Magic Microscope” test rejected

Court rejected the government’s proposed “magic microscope” test. The ability to visualize a DNA molecule through a microscope when it is bonded to other genetic material, is worlds apart from possessing an isolated DNA molecule that is in hand and usable.  It is the difference between knowledge of nature and reducing a portion of nature to concrete form, the latter activity being what the patent laws seek to encourage and protect. The government’s microscope could focus in on a claimed portion of any complex molecule, rendering that claimed portion patent ineligible, even though that portion never exists as a separate molecule in the body or anywhere else in nature, and may have an entirely different utility. Visualization does not cleave and isolate the particular DNA; that is the act of human invention.

Method claims of “Comparing” or “Analyzing” Sequences abstract mental steps, not patent-eligible

Myriad argued that its claims to methods of “comparing” or “analyzing” BRCA sequences satisfy the machine-or-transformation test because each requires a transformation—extracting and sequencing DNA molecules from a human sample—before the sequences can be compared or analyzed.

The claims recite, for example, a “method for screening a tumor sample,” by “comparing” a first  BRCA1 sequence from a tumor sample and a second BRCA1 sequence from a nontumor sample, wherein a difference in sequence indicates an alteration in the tumor sample. This claim thus recites nothing more than the abstract mental steps necessary to compare two different nucleotide sequences: one looks at  the first position in a first sequence; determines the nucleotide sequence at that first position; looks at the first position in a second sequence; determines the nucleotide sequence at that first position; determines if the nucleotide at the first position in the first sequence and the first position in the second sequence are the same or different, wherein the latter indicates an alteration; and repeats the process for the next position.

Method of Screening Potential Cancer Therapeutics patent-eligible

This claim 20 of the ’282 patent, is directed to a method for screening potential cancer therapeutics via changes in cell growth rates of transformed cells. Those transformed cells arose from human effort; i.e., they are not natural products.  Plaintiffs nonetheless challenge claim 20 as directed to the abstract idea of comparing the growth rates of two cell populations and as preempting  a basic scientific principle—that a slower growth rate in the presence of a potential therapeutic compound suggests that the compound is a cancer therapeutic.

The claim 20 does not simply apply a law of nature. Claim 20 applies certain steps to transformed cells that are a product of man, not of nature. By definition, performing operations, even known types of steps, on, or to create, novel,  i.e., transformed subject matter is the stuff of which most process or method invention consists.

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1. Domain name is identical or confusingly similar to a trademark
2. The one who registered domain name has no rights or legitimate interests in respect of the domain name
3. Domain name has been registered and is being used in bad faith.

Based on above, trademark is one necessary element to claim rights to domain name registered by another, but not enough.  Now Paris Court of Appeal has given interesting decision under French law, in which claim for trademark infringment was denied, but claim for domain name transfer was granted.

The case related to arcotel.fr domain name, and the court noted that the defendant had established that it had used the term ‘Arcotel’ as part of its company name since 1986.  The court ruled that it could not justify prohibiting use of the term ‘Arcotel’ by the defendant.  However, even if the court considered that while the use of the term ‘Arcotel’ could not be separated from the name of the hotel and its physical premises, the use of this term in a domain name could be separated from the hotel and could thus create a risk of confusion with the claimant’s trademark. On this basis, the court ordered the transfer of the domain name to the claimant.

In other words, the court applied one set of rules to the defendant’s offline use and another to its online use of the domain name. This is also interesting example how both case by case considerations as well as jurisdiction by jurisdiction considerations are important in every case.

For more information  see international law office newsletter (registration may be required).

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