UK Supreme Court Issues Milestone Judgment for AI and Software Patentability

“[T]he rejection of the Aerotel approach by the EPO cannot sensibly be described as just a preference for a different methodology or practice among a range of options potentially available. It is a rejection firmly based upon a determination that the Court of Appeal in Aerotel misinterpreted the EPC…” – UK Supreme Court

The UK Supreme Court today issued a landmark judgment on AI patentability that is likely to impact all software patents going forward.

The decision in Emotional Perception v. Comptroller General of Patents, Designs and Trade Marks primarily held that the approach taken in Aerotel Ltd v Telco Holdings Ltd [2006] EWCA Civ 1371; [2007] Bus LR 634; [2007] RPC 7 (Aerotel) should no longer be followed.

Under Aerotel, courts and examiners consider a four-step test for assessing whether a claim is excluded from patent eligibility: 1) properly construe the claim, 2) identify the actual/ alleged contribution, 3) ask whether the contribution is excluded and 4) check if the contribution is technical.

The UK Intellectual Property Office (UKIPO) applied Aerotel to the case at hand to find a patented system for providing media file recommendations based on an artificial neural network (ANN) ineligible. Specifically, the UKIPO Hearing officer said that “the contribution in the present case falls solely within the computer program exclusion and that ‘the ANN-based system for providing semantically similar file recommendations is not technical in nature.’”

The decision of the UKIPO was appealed to the High Court of Justice, which held in 2023 that the claim at issue did not claim “a program for a computer…as such” and therefore the invention was not excluded under the UK statute. The UK Patents Act of 1977 expressly lists categories of patent ineligible subject matter, including business methods and computer programs.

The High Court decision was then appealed to the UK Court of Appeal, which reversed that decision in 2024. Emotional Perception then brought the appeal up to the Supreme Court.

In today’s judgment, the Supreme Court instructed courts and the UKIPO to follow the European Patent Office (EPO) Enlarged Board of Appeal’s interpretation of article 52 pf the European Patent Convention (EPC) on patentable inventions in Bentley Systems (UK) Ltd/Pedestrian Simulation (Decision G1/19) [2021] EPOR 30 (“G1/19”) G 0001/19. “This decision approved earlier dicta of the EPO Board of Appeal to the effect that the approach endorsed in Aerotel was not a good faith implementation of article 52, was incompatible with it and was based upon a misunderstanding of the meaning of the word ‘invention’ as used in the EPC,” wrote the UK Supreme Court.

The G 0001/19 approach says that “if the subject matter of the claim involves the use of any hardware, then article 52(2) is at least prima facie inapplicable,” according to today’s decision.

While the Supreme Court found that the ANN in the present case still falls under the category of “programs for computers,” it held, following the reasoning in G 0001/19, that they do not comprise a program for a computer “as such,” within the meaning of Article 52(2) and (3) of the EPC read together.

Article 52(3) says that “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 Court then pointed to an “intermediate step” under the guidance of EPO G1/19, in which courts should determine which features are “technical” and “non-technical” before assessing novelty and inventive step.

Since the Court found the claims in the instant case did not comprise a program for a computer “as such,” they qualify for assessment under novelty, inventive step and industrial application, so the Court instructed the UKIPO Hearing officer to reconsider “whether the features of the invention which contribute to its technical character can be considered to involve an inventive step.”

The Supreme Court judgment explained its decision to depart from Aerotel had to do in part with the view that Aerotel was a misinterpretation of the EPC:

“[L]eaving aside the references to problem and solution, the rejection of the Aerotel approach by the EPO cannot sensibly be described as just a preference for a different methodology or practice among a range of options potentially available. It is a rejection firmly based upon a determination that the Court of Appeal in Aerotel misinterpreted the EPC, and that its approach was both irreconcilable with the EPC and indeed not to be regarded as a good faith attempt to implement it.”

Commenting on the decision today, Jonathan Ball, of Norton Rose Fulbright called the case “a highly significant moment for UK patent law and a major boost for AI innovators.” He explained that abandoning the Aerotel test and adopting the “any hardware” approach “has brought the UK in alignment with the European practice on when a computer program could be a patentable invention.” Ball added:

“Computer programs ‘as such’ continue to not be patentable. However, AI and software?based inventions that claim ‘any hardware’ as part of the invention – like Emotional Perception’s ANN, which involves hardware both in its physical form and in the computer that runs the software version – would not be excluded matter for the purposes of determining patentability.”

Ball also said the decision “could make it easier for AI companies to secure patent protection in the UK, because the bar for clearing the ‘excluded subject matter’ stage is now ostensibly lower.”

Michael Neilsen of EIP noted that the scope of today’s decision “is much wider than many people anticipated.” Neilsen continued:

“The immediate consequences of the decision will be felt in patent applications currently on file at the UKIPO, where the approach to assessing excluded subject matter will change immediately….

“Novelty and inventive will then only be based on the features that are identified as ‘technical’. This intermediate step is very similar to a step carried out under the EPO’s approach to inventive step, but aside from the inclusion of this intermediate step, the UK approach to inventive step supposedly will not change. This raises many questions about how to reconcile this feature-by-feature assessment taken from the EPO’s approach to inventive step with the much more holistic approach in the UK.”