Intellectual Asset Funding

 

Jane Lambert

Intellectual assets are the creations of the mind that give a business a competitive advantage over all others.  Examples include inventions, computer programs and goodwill.  They are not to be confused with intellectual property such as patents, copyrights and trade marks which protect them.

For many businesses, intellectual assets are their most valuable property.  However, their value has not always been appreciated.  Recently, lenders such as the NatWest Group have begun to accept intellectual assets as security for advances.  For instance, the NatWest Group teamed up with Inngot Limited to launch an IP-based lending proposition for high-growth businesses (see NatWest launches Intellectual Property-based lending to fuel high growth businesses 12 Jan 2024, NatWest website).

Following the former Chancellor's Mansion House speech, the British Business Bank announced a £6.5bn uplift to the Growth Guarantee Scheme to unlock further lending to smaller businesses over the next four years and up to £500m of ENABLE Guarantee capacity ringfenced over the next 12 months to support Intellectual Property-rich smaller businesses (see British Business Bank welcomes Chancellor of the Exchequer’s announcement of package of new measures to support smaller businesses 12 July 2026).

In that press release, the British Business Bank observes that many innovative businesses have significant value in intellectual property but lack the physical collateral that lenders traditionally rely on, which makes it difficult and prohibitively expensive to access debt finance.  Recognising this, the British Business Bank is making up to £500m of existing funding capacity available over an initial 12-month period to support lending to IP-rich smaller businesses. That is expected to help increase the availability of finance for IP-rich businesses, enable more competitive pricing and develop stronger lender capability to assess IP-driven business models.

The value of intellectual property rests ultimately in its ability to prevent unfair competition and resist applications for revocation and invalidation.  These matters are decided ultimately in the courtroom.  The persons best placed to advise on the likely outcome of infringement and invalidity proceedings are the advocates who would have to argue those points before judges and hearing officers.

Anyone wishing to discuss this article may call me on +44 (0)20 7404 5252 during office hours or send me a message through my contact form at any time.

Sir Adrian Hill wins the European Inventor Award Research Category

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Jane Lambert

The European Inventor Award is a biennial "celebration of the inventive spirit, the individual contributions of talented inventors, and the European patent system that protects inventions and encourages innovation" established by the European Patent Office in 2006.  Prizes are awarded for inventions in the following categories:

• industry
• research
• Non-EPO countries
• SMEs
• lifetime achievement, and
• popular prize.

Winners of each category receive a trophy in the form of a sail designed by Miriam Irle.

The research category celebrates inventors working at universities, research institutions or their spin-offs. The winner of this year's research category is Professor Sir Adrian Hill, Founding Director of the Jenner Institute and Chair of the Centre for Clinical Vaccinology and Tropical Medicine at the University of Oxford.  The invention for which this year's research award was granted was the R21/Matrix-M vaccine against malaria, more particularly described in European patent specification EP2945649 B1

According to Wikipedia, Sir Adrian was born in Ireland.   He attended Belvedere College SJ in Dublin, read medicine at Trinity College Dublin and Magdalen College, Oxford and carried out his doctoral research on the molecular genetics of thalassemia at Oxford.   As well as being a leader in malaria vaccine development, Sir Adrian was a co-leader of the research team that produced the Oxford–AstraZeneca COVID-19 vaccine.  He was knighted for his services in 2021.

Anyone wishing to discuss this article or the European Inventor Awards in general may call me on +44 (0)20 7404 5252 during normal office hours or send me a message through my contact form.

Knowledge Asset Management Hub

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Jane Lambert

The Knowledge Asset Management Hub is a resource to help universities and other research institutions identify, protect and commercialise their intellectual assets.  It brings together a comprehensive set of practical resources.  According to the announcement on the Intellectual Property Office website, the Hub consists of the following components:

• "Institutional IP strategy guidance — practical frameworks to help universities and research organisations develop and implement IP strategies and policies at an organisational level
• Project-level IP risk and opportunity tools — resources to help teams identify and manage IP considerations within individual research projects, from early-stage collaboration agreements through to commercialisation
• Patent data analysis and IP due diligence resources — tools to support the assessments that underpin licencing, spin-out formation, and investment decisions
• Knowledge Asset Management Toolkit — guidance recognising that effective knowledge asset management requires strategic and operational management."

The following guides were published with the announcement:

• KAM Guide: Introduction and intellectual property policy:  an excellent introduction to those unfamiliar; 
• KAM Guide: Intellectual property management: a more detailed guide on the different IP rights and how they mayh be acquired; 
• KAM Guide: Further resources and glossary of terms: links to the relevant statutes, guidance on funding and licensing and glossary;
• Knowledge Asset Management Guide:  very handy document, particularly for those with a grounding in IA management; 
• Knowledge Asset Management(KAM) Toolkit: useful charts, checklist and basic infor; and 
• IP due diligence quick guide: introduction to due diligence and an explanation of why it is important.

Useful though these guides are they cannot cover everything.  Anyone wanting to discuss any of these topics is welcome to give me a bell on +44 (0)20 7404 5252 during UK office hours or send me a message at any time.

How will the Emotional Perception Case affect Inventors in the UK?

Supreme Court of the United Kingdom

Author Kelsey Farish Licence CC BY 4,0  Source Wikimedia Commons

 

Jane Lambert

The Supreme Court's judgment in Emotional Perception AI Ltd. v Comptroller General of Patents, Designs and Trade Marks [2026] UKSC 3 which was handed down on 11 Feb 2026, reverses nearly 20 years of case law on the meaning and application of s.1 (2) (c) of the Patents Act 1977:

"It is hereby declared that the following (among other things) are not inventions for the purposes of this Act, that is to say, anything which consists of—
......
(c) ........ a program for a computer;
......

but the foregoing provision shall prevent anything from being treated as an invention for the purposes of this Act only to the extent that a patent or application for a patent relates to that thing as such."

Ever since the Court of Appeal delivered its joint decision in  Aerotel Ltd. v Telco Holdings Ltd and others Rev 1 [2006] EWCA Civ 1371 (27 Oct 2006) the courts of England and Wales, Scotland and Northern Ireland and the patent examiners and hearing officers of the Intellectual Property Office ("the IPO") have applied the following test:

"(1) Properly construe the claim.
(2) Identify the actual contribution (although at the application stage this might have to be the alleged contribution).
(3) Ask whether it falls solely within the excluded matter.
(4) If the third step has not covered it, check whether the actual or alleged contribution is actually technical."

In Emotional Perception, the Supreme Court held at para [20] of its judgment that Aerotel should no longer be followed.   I explained why in Emotional Perception AI Ltd v Comptroller in the Supreme Court on 12 Feb 2026 in NIPC Law:

"The Justices noted that the Enlarged Board of Appeal of the Europeam Patent Office had approved in G1/19 Bentley Systems (UK) Ltd/Pedestrian Simulation (Decision G1/19) [2021] EPOR 30) cases that stated that the Aerotel/Macrossan approach was not a good faith implementation of art 52 of the European Patent Convention which s.1 (2) (c) of the Patents Act 1977 is supposed to implement in the United Kingdom. One of those cases held that the Aerotel/Macrossan approach was incompatible with art 52 because that approach had been based on a misunderstanding of the word "invention" as used in the Convention."

As is to be expected, there is a note on the Manual of Patent Practice that the IPO is reviewing the Supreme Court's judgment and that its guidance between para 1.07 and 1.51.7 is subject to change.   

How much difference this new guidance may make in practice is uncertain.   Mr Justice Birss (as he then was) remarked in para [9] of Lenovo (Singapore) PTE Ltd v Comptroller General of Patents [2020] EWHC 1706 (Pat), [2020] RPC 18), that “although in methodological terms the approach in the UK and the approach in the EPO may look different, in practice they reach the same result, at least usually.”Also, most UK patent attorneys with experience of software patent applications will have applied for patents to the European Patent Office as well as the IPO and will be familiar with its practice.   For those who are uncertain, para 3.6 of the April 2025 edition of the Guidelines for Examination in the European Patent Office should provide most of the answers.

Anybody wishing to discuss an issue related to this topic under my Initial Advice and Signposting Scheme should complete the form.  I plan to call an online meeting of the NIPC Inventors Club to explain the Emotional Perception case.   Anyone wishing to talk to me can call me on +44 (0)20 7404 5252 during UK office hours or send me a message through my contact form.

Further Reading

Jane Lambert Emotional Perception AI Ltd v Comptroller in the Supreme Court 12 Feb 2026 NIPC Law:

If only ...........

Jane Lambert

 

Barristers are called upon to advise or provide representation when something has gone terribly wrong.  Often, we are called in far too late. When that happens, we say to ourselves, "If only the client had taken professional advice sooner."  That is particularly true of intellectual property law where a right of action can be lost because the client did not seek legal protection for his or her invention, brand or product design or he or she stumbles into an infringement claim because he or she did not carry out the necessary patent, trade mark or registered design searches before launching his or her business or product.

There are two reasons for this.  The first is that clients do not always know whom to consult.  There are many different types of professionals in intellectual property, such as patent and trade mark attorneys (formerly known as "patent" and "trade mark agents"), patent searchers and specialist IP counsel and solicitors that the public rarely encounters.    I counted 23 separate professions in How to Get Into IP.  The other reason is that they are worried about intellectual property practitioners' fees which can be pricey.

The initial advice and signposting service that I have offered for many years in London, the North of England and Wales meets both concerns.  In many instances, I can give you the answer to your question immediately for nothing.  In others, I may have to refer you to another professional, such as a patent or trade mark attorney, a specialist IP tax consultant or a product design consultant who will also give you at least 30 minutes of his or her time free.

It is important to note that not everything is free.  We will analyse your needs and explain your options pro bono, but if you ask any of us to advise or act for you further, we will charge for our service, albeit at a competitive rate.

It gives me great satisfaction to report that the Barnsley Business Village, which hosts some great innovative businesses, is promoting my initial advice and signposting service to its tenants.   It is important to stress that anyone can register for the service by completing this form.  This scheme is not restricted to Business Village tenants or even to residents of Yorkshire.   

The Initial Advice and Signposting service is only one of several offered by NIPC Inventors' Club.   We also hold events, give online talks.  The next event will be a conference at the Business Village in February on writing an IP strategy and integrating it into a company's business plan.  Finally, we publish the NIPC Inventors Club blog. 

If you want to learn more about our service, call me on 020 7404 6262 or send me a message through this form.

European Patent Applications from the UK in 2024

European Patent Office, Munich

Author Carsten Steger  Licence  CC BY-SA 4.0   Source  Wikimedia Commons

 

Jane Lambert

The European Patent Office ("EPO") is the fifth-largest patent office in the world.   The other four are the China National Intellectual Property Administration, the United States Patent and Trademark Office, the Japan Patent Office and the Korea Intellectual Property Office.  The EPO grants patents for the territories of its contracting parties on behalf of their governments.  The United Kingdom is one of those parties.  A patent granted by the EPO designating the UK (known as a "European patent (UK)") is treated as equivalent to a patent granted by the Intellectual Property Office in Newport for all practical purposes.

According to EPO figures published earlier this year, there were 6,076 applications from the United Kingdom in 2024.  That was an increase of 3.1% over the previous year, and it placed this country 9th in the list of countries of origin for European patent applications.   The countries ahead of us were the United States with 47,787 European patent applications, Germany with 25,033, Japan with 21,062, China with 20,081, South Korea with 13,107,  France with 10,980, Switzerland with 9,966 and the Netherlands with 7,054.  Immediately behind the UK was Sweden with 4,936 applications.  Italy was 11th with 4,853, and Spain was 15th with 2,192.  In the top 10 countries of origin, only South Korea and Switzerland exceeded the UK's percentage increase in European patent applications, though Hong Kong and Norway, which are further down the list, saw double-digit percentage increases.

Britain's 3.1% uptick is less impressive when the number of European patent applications per country is compared to its population.   Switzerland produced  1,112.8 applications per million inhabitants.   It was followed by Sweden with 467.79, Finland with 428.28 and Denmark with 425.92. With 87,88 applications per million, this country came 18th in the list which is surprising for the country that pioneered the industrial revolution and has some of the finest universities in the world.

The following graphic shows the fields for which applications from the UK were filed in 2024.

Consumer goods came top, followed by computers, med-tech and biotech.   The top 10 applicants were as follows:

British American Tobacco Plc	636
Unilever Plc	613
Rolls-Royce Plc	254
BAE Systems Plc	184
British Telecommunications Plc	175
Linde Plc	173
Imperial Brands Plc	140
AstraZeneca Plc	121
Shell Plc	116
Johnson Matthey Inc.	105

One of the reasons why the UK has underperformed its competitors in patenting was thought to be the risk and costs of IP enforcement.   The Arnold reforms which I discussed in New Patents County Court Rules on 31 Oct 2010 NIPC Law, were intended to be an answer to that problem.  It seems to be taking a long time for news that IP enforcement need not be ruinously risky and expensive to filter down to industry.

Small and medium enterprises can protect themselves against such risk and cost by taking out IP insurance cover.  The Intellectual Property Office has published useful Guidance on Intellectual Property Insurance, and the Chartered Institute of Patent Attorneys maintains a comprehensive list of brokers, underwriters and insurers on its website.

Anyone wishing to discuss this article may call me on +44 (0)20 7404 5252 during normal office hours or send me a message through my contact form at any time.

Hydrogen Technology Inventions and the World Hydrogen Summit

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Jane Lambert

The World Hydrogen Summit will take place at Rotterdam Ahoy between 20 and 22 May 2025.  It will consist of a conference and an exhibition (see the conference programme, the list of speakers and the list of exhibitors).  This event will be of particular interest to the residents of Anglesey (described by their local authority as "Energy Island") because Menter Môn will represent Wales in Rotterdam (see press release 14 May 2025 Ynys Môn to represent Wales at World Hydrogen Summit 2025).

The importance of this source of energy was highlighted in the European Patent Office's press release of 10 Jan 2023 to announce the publication of Hydrogen patents for a clean energy future - A global trend analysis of innovation along hydrogen value chains, a joint report by the European Patent Office and the International Energy Agency.   António Campinos, President of the European Patent Office, said:

"Harnessing the potential of hydrogen is a key part of Europe's strategy to achieve climate neutrality by 2050...."

 Fatih Birol, Executive Director of the International Energy Agency, added:

"Hydrogen from low-emissions sources can play an important role in clean energy transitions with potential to replace fossil fuels in industries where few clean alternatives exist, like long-haul transport and fertilizer production,"

According to the press release, the joint report is the most comprehensive and up-to-date study of global trends in hydrogen technologies for 2011-2020.  Patenting related to hydrogen is led by the EU (28%) and Japan (24%), while the US (20%) is the only major innovation centre to lose ground in the past decade.  Within the EU, Germany (11%), France (6%) and the Netherlands (3%) rank first for patenting hydrogen technologies.  Among end-use applications, automotive continues to be the biggest focus of innovators.  The press release stated that start-ups holding patents attracted more than half of the US$10 billion in venture capital investment into hydrogen-related firms in the last decade.

Anyone wishing to discuss this topic may call me on +44 (0)20 7404 5242 during UK office hours or send me a message through my contact page.

Online Inventors Academy: Tips for Inventors - Confidentiality Agreements

F, Jouffroy Premier Secret confié à Vénus

Photographer Christophe Moustier Licnece Set out in Wikimedia Commons

 

Jane Lambert

Most inventors will have been told by their patent attorneys, Business and IP Centre librarians or other advisors to keep their invention secret until they apply for a patent.  The reason for that advice is that a patent can be granted only if the invention is new.  Once the public knows about it, the invention is by definition no longer new.   It is also worth mentioning that a lot of inventions will never be patented for one reason or another.   In some cases that may be because their subject matter is unpatentable.  In other cases, it may be because the invention is not worth the cost of patenting. 

Inventors often need to discuss their inventions with others such as possible collaborators, product design consultants, business angels, manufacturers or potential licensees.  When they do so, they are often advised to obtain the signature of the person to whom they disclose the invention ("the confidante") on a confidentiality or non-disclosure agreement ("NDA"). Such agreements require the confidante to use the information only for a specified purpose and either not to disclose the information at all or to disclose it only to designated personnel.

It is important to note that the obligation not to disclose or use such information arises not from the agreement but from the law of confidence. Mr Justice Megarry explained the principle in Coco v A.N. Clark (Engineers) Limited [1968] F.S.R. 415, 419:

"In my judgment, three elements are normally required if, apart from contract, a case of breach of confidence is to succeed. First, the information itself, in the words of Lord Greene, M.R. in the Saltman case on page 215, must 'have the necessary quality of confidence about it.' Secondly, that information must have been imparted in circumstances importing an obligation of confidence. Thirdly, there must be an unauthorised use of that information to the detriment of the party communicating it. I must briefly examine each of these requirements in turn."

Probably the most frequently found circumstance in which the imparting of information gives rise to an obligation of confidence is when the person confiding the information ("the confider") and the confidante enter a confidentiality agreement.  It is not, however, the only circumstance.   Another instance is where a client seeks advice from a solicitor or patent attorney.   No NDA is required because it is obvious that the client is disclosing, and the solicitor or attorney is holding, such information in confidence.  

In Coco, the judge said that the information must have the necessary quality of confidence about it.  That means that the information must have some value in that its unauthorized use or disclosure must either benefit the confidante or harm the consider. The information must be secret or at least not generally known.   It could be sensitive technical or commercial information or personal information such as the state of a celebrity's marriage.   A third requirement is that the confider must take reasonable steps to prevent the information's disclosure or misuse perhaps by keeping the document containing the information under lock and key or in a restricted file on a computer.

Obligations of confidence are usually enforced by proceedings in the civil courts.  In There's more to the Law of Confidence than NDAs 14 Oct 2019 I wrote:

"If, as sometimes, happens I am instructed to resist an application for an interim injunction where the applicant relies on an NDA I have a field day. First, I ask whether the information was ever confidential in the first place. Sometimes it is something that has been common knowledge in the industry since Adam was a boy. Other times there has been no attempt to keep the information secret. I was once negotiating terms of a licence which negotiations were taking place in serviced offices when I found the other side's supposedly confidential document in the publicly accessible ladies' loo. There is often room to dispute whether the confidentiality agreement was ever intended to apply to the information in question. One way or another, a halfway competent intellectual property specialist can drive a coach and horses through a bog-standard standalone non-disclosure agreement."

It is essential to specify in the NDA the information that is confidential, the occasion on which it is communicated, the documentation or media in which it is held, the persons to whom it can be disclosed, the purpose of the disclosure, the use to which the information can be put, the deadline for the return of the documents, media and any copies and so on.

In the above article, I suggested:

"If you want to rely on the law of confidence, print a form in duplicate on no carbon required paper with boxes for:

• The name and full postal address, job title, email, telephone and other contact details of the confidante and those of his or her employer if they are different.
• Identify the information to be delivered and the way in which it is to be passed (that is to say, private conversation, whether it is is a document and if so what it contains).
• An acknowledgement that the information has been disclosed in confidence.
• A finite period in which the confidante can contend that the information is not confidential at all and a rapid and cost-effective way of resolving such contentions such as expert determination or expedited arbitration.
• The use to which the information may be put.
• A deadline for the return of confidential documents and may have been made.
• Submission to the jurisdiction of the English courts.

Every single confidential conversation and the delivery of every single document should be recorded and logged separately. If any of the conditions is breached, the confider should call the confidante at once. If it is still not put right the confider should consider legal action including possibly an interim injunction."

Interim injunctions are not cheap to obtain because a lot of work has to be done by solicitors, patent attorney or other authorized litigators and counsel or other advocates in a very space of time.  There is always a risk that the application may fail and the applicant will be required to contribute to the respondent's costs in addition to his or her own.  But if the information is essential to the success of an enterprise there may be no other way.  

For most startups and many other small and medium enterprises, the only way in which enforcement litigation can be funded is by obtaining before-the-event insurance.   I have been urging inventors to take out such cover since 2005 (see IP Insurance  3 Sept 2005),   I repeated my message every year until 2020 2020 when the Chartered Institute of Patent Attorneys published its own guidance on IP insurance to its members (see IPO Guidance: Intellectual Property Insurance 25 Feb 2020).  I now refer inventors and all SME to CIPA's Advice on IP insurance which complements comprehensive Guidance on Intellectual Property Insurance from the Intellectual Property Office.

Last September I launched the Online Inventors Academy with a talk on Patents and Alternatives to Patenting.   Although the audience was not large we had a very lively and informed discussion that exceeded the advertised time by a whole hour,  Unfotunately the response to the next event was disappointing.    As Christmas was approaching we decided to relaunch the Online Inventors' Club and the Online Inventors' Academy until the New Year.   I will kick off the new season with a talk on confidentiality on 23 Jan 2025 at 18:00.   Attendees can join by clicking this link.

Anyone wishing to discuss this article or the Online Inventors' Club or Academy generally should call me on 020 7404 5252 during normal UK office hours or send me a message through my contact page, 

European Universities' Patenting Activity

 

Jane Lambert

In October 2024 the European Patent Office published The Role of European Universities in Patenting and Innovation, A Study of Academic Inventions at the EPO.  The study claims to be "the first-ever comprehensive overview of the role European universities play in patenting and innovation on the European scale." 

The study notes that Europe is often perceived as a world-class academic power with top universities and publications. Europe faces difficulties transforming science into commercial activity compared to other advanced economies. The mismatch between academic excellence and commercial underperformance is sometimes called the 'European paradox'. The study states that this so-called European paradox has become a central policy issue in most European countries and also for the EU.

The study focuses on European universities' patenting activity as a way of addressing that paradox because a patent is essential to knowledge transfer. That is because an applicant for a patent is required by art 83 of the European Patent Convention to disclose the invention in a manner sufficiently clear and complete for it to be carried out by a person skilled in the art.   

One of the study's key findings is that the contribution of academic researchers to European patent applications has increased steadily in recent decades, and now exceeds 10% of all patents filed by European applicants at the EPO. The study finds that more than 1,200 European universities have generated patent applications at the EPO. Annex 2 to the study lists the top 10 universities for Germany, France and the UK and the top 5 for other countries between the years 2000 and 2020. There are 7 universities with over 1,000 academic patents in Germany, 6 in France and 4 in the UK (Oxford, Cambridge, Imperial and UCL). Denmark, Sweden and Switzerland have 2 such universities each and Belgium, Finland and the Netherlands one each.

It is undeniably a good thing that knowledge is widely disseminated while being properly protected it has to be remembered that universities are not businesses though most have knowledge transfer offices and licensing companies.  It is my experience that they occasionally claim greater legal protection than they need or in some cases to which they are entitled to the detriment of the businesses that pay for the research,  
 

Any business contemplating research cooperation with a British university should seek advice either from a patent attorney or a solicitor or counsel specializing in IP with experience in licensing.  The Intellectual Property Office publishes several model university and business collaboration agreements known as "the Lambert toolkit".  The name of the toolkit refers to Sir Richard Lambert and not to me though I did attend one of the drafting sessions and thus made a small contribution towards their drafting.

Anyone wishing to discuss this article may call me on +44 (0)20 7404n 5252 during UK office hours or send me a message through my contact form at all other times.

Online Inventors' Club: Patents and Alternatives to Patenting

Patents and alternatives to patenting.pdf from Jane Lambert

Yesterday, I launched the NIPC Inventors' Club Online Inventors' Academy with an introduction to patent law and patenting for independent inventors. The slides appear above.  Those who missed the talk can download the slides here or from Slideshare.  There will also be a link to the presentation from the NIPC Inventors Club group page on Linkedin.

Although not everybody who had registered joined the call, those who did enjoyed a very lively discussion.  The session, which was due to last an hour, finished at 19:58 almost two hours after it began.  It was particularly gratifying to welcome one of the regulars at the Sheffield Inventos' Club which I chaired for many years.  

The objective of the exercise is to reproduce the mutual support for independent inventors that used to subsist at inventors clubs that met in Central Libraries, universities and other venues around the country until a few years ago.  Some of those clubs disbanded after several of the libraries joined the British Library's Business and IP Centre's national network.  Others ceased to meet during the COVID-19 pandemic.  

The next talk will be on the resources that are available to independent inventors.   It will take place on 17 Oct 2024 between 18:00 and 19:00.  As I said in The Online Inventors' Academy on 29 Aug 2024:

"The next talk will be on the services that are available to inventors. I will start with the British Library and its national network of Business and IP Centres. I will mention patent clinics and search services at the Centres and other PatLib libraries. I will talk about the help that is available from local authorities in England, Business Wales in Wales and its counterparts in Scotland and Northern Ireland. Lastly, I will consider the online resources that are available for inventors from the IPO, EPO, WIPO, British Library, UKRI and other agencies."

I shall post the registration invitation later today and look forward to welcoming everybody interested to that event.

Finally, I was asked a couple of questions about IP insurance yesterday.   I have written a lot about the topic as can be seen from the bibliography at the end of my article  IPO Guidance: Intellectual Property Insurance which I, posted on 25 Feb 2020.  The most up-to-date guidance is CIPA's and the Intellectual Property Office's.

Anyone wishing to discuss this article can call me on 020 7404 5252 during UK office hours or send me a message through my contact form at any time.

The Online Inventors' Academy

Jane Lambert

Independent inventors (that is to say, inventors who are not employed in research and development in a company or university) have contributed much to the economies of many countries including our own. Unlike some other countries, we do not do much to encourage them.  The United States Patent and Trade Mark Office lauds American inventors in a National Inventors Hall of Fame. The Korea Invention Promotion Association has a slogan "One Person with One Invention." Our government did fund an Inventor Prize in August 2017 but terminated that initiative the following year.

British inventors might do better if they were better informed of the steps to be taken between having a bright idea and earning money from it.  Until the pandemic, some of that information was provided by inventors' clubs.  The Wessex Round Table of Inventors has maintained a page of links with inventors' clubs for many years.  I tried all those links yesterday and found many of them were broken.  There may well have been some new clubs.   I recently wrote about the launch of an inventors club at the British Library but I have not heard of any more.  

I have long campaigned for an inventors' academy along the lines of the USPTO's Annual Independent Inventors' Conference at its head office in Alexandria.  Many have agreed that such a conference would be a good idea and nobody has rubbished it but everyone has always had more immediate priorities.  It seems to me that nothing will happen unless I make a start.  To that end, I am offering a course of online lectures between 18:00 and 19:00 on the third Thursday of every month between  19 Sept 2024 and 17 July 2025.  As I chaired the Leeds, Liverpool and Sheffield Inventors Clubs for many years I think I have a pretty good idea of what independent inventors need to know and just as valuable what they don't need.

The first talk on 19 Sept will be on the legal protection of new technology,   I will, of course, discuss patents and how to apply for them and how to apply for them but I will also discuss alternatives.  Prosecution and enforcement costs, renewal fees and other expenses will be mentioned as well as the risks of revocation.  Steps to mitigate the risks and expenses such as before-the-event insurance will be addressed.  I shall also deal with inventions that cannot be protected by patents.  Finally, I will talk about patent attorneys, where to find them and how to select and instruct them.

The next talk will be on the services that are available to inventors.  I will start with the British Library and its national network of Business and IP Centres.  I will mention patent clinics and search services at the Centres and other PatLib libraries.   I will talk about the help that is available from local authorities in England, Business Wales in Wales and its counterparts in Scotland and Northern Ireland.  Lastly, I will consider the online resources that are available for inventors from the IPO, EPO, WIPO, British Library, UKRI and other agencies.

Other talks will focus on manufacturing, outsourcing manufacturing and licensing.  I will also discuss enforcement in this country and overseas.   Anybody who attends the full programme will receive a transcript which may assist them in fundraising or employment,

The Online Academy will be just one of many benefits of the NIPC Inventors Club;  Others will be the Initial Advice and Signposting service that can be offered online or in Yorkshire, North Wales or London. There will also be a vast library of articles and precedents (template forms) which can be accessed through this publication.

Anyone wishing to discuss this article may call me on 020 7404 5252 or send me a message through my contact form.   Anyone wishing to register for the first talk on 19 Sept 2024 should click here.

Computer Programs Exception Applies to Artificial Intelligence

Diagram made and uploaded by Jimhutchins Licence CC BY-SA 3.0 Source Wikimedia

Jane Lambert

It is well known that a patent cannot be granted in the United Kingdom for computer programs "as such" but that does not prevent patents from being granted for software-implemented inventions,  The difference between what is patentable and what is not was explained by the Court of Appeal in two cases that were heard together, Aerotel Ltd v Telco Holdings Ltd and Re Macrossan [2006] EWCA Civ 1371, [2006] Info TLR 215, [2007] BusLR 634, [2007] RPC 7, [2007] Bus LR 634, [2007] 1 All ER 225:  Aerotel was successful because the invention was a new system even though the only thing that distinguished it from previous systems was the addition of a component called "a special exchange" that consisted of known hardware.  Macrossan was not because it was essentially a process carried out by a computer that had previously been carried out by hand.

Considerable interest was aroused last year in a judgment by Sir Anthony Mann that a system for analysing a user's tastes in music and selecting and recommending a track from any genre with which he or she might not have been familiar was patentable. There were already systems that divided music tracks into genres such as classical, folk, rock and so on which were capable of recommending a track from the same genre to a music fan based on his or her previous choices,  The clever aspect of the invention in the case before Sir Anthony was that it trained itself to analyse a user's emotional and subjective preferences using artificial intelligence rather than relying on the user's previous record selections.

The invention could perform that task because it ran on an artificial neural network ("ANN"). That was an information processing system that mimicked the processing in the brain rather than the binary switching of transistors in a conventional computer.  In an ANN the system trains itself in the process of analysing a user's preferences by adjusting qualifiers known as "weights" and "biases" to the information processing apparatus of individual artificial neurons.  Once the process is complete the weightings can be transferred to another system.  Sometimes that system is permanently wired (a process known as "hard wiring").  It is also possible to program a conventional computer to function in the same way as an ANN with neurons that have the transferred weightings.

The reason why there was so much interest in Sir Anthony's judgment was that he did not appear to consider that a hardwired ANN was a computer at all and that it certainly did not have a program.  That appeared to be true even of an ANN running on a conventional computer.   That was enough to put such systems outside the computer program exception altogether.

His judgment did not stand.  The Comptroller-General of Patents, Designs and Trade Marks (the official title of the head of the UK Intellectual Property Office) appealed to the Court of Appeal against Sir Anthony's decision.  The appeal was heard by a bench that included Lord Justice Arnold and Lord Justice Birss (two of this country's most distinguished intellectual property judges) as well as Lady Justice Nicola Davies who presided over the proceedings.  The hearing has been filmed and can be viewed on the Court of Appeal's YouTube channel here and here.   

Delivering the judgment of the Court, Lord Justice Birss defined a computer as "a machine which processes information" and a computer program as "a set of instructions for a computer to do something."  An ANN fell within his definition of a computer and it made no difference as to whether it was hardwired or software implemented.  The training process by which a user's preferences were analysed including the adjustment of weightings in individual artificial neurons fell within the definition of computer program even though it was automatic.  He could see no reason why a program had to be written by a human.   That was enough to haul the invention within the statutory exclusion of computer programs "as such."

The only thing that remainder for the Court to decide was whether the invention was a computer program "as such" or something more.   In Aerotel the application got through because it was for something more, namely a new telecommunications system.  Macrossan didn't because it simply automated a manual process.  In other words, it was a computer program "as such."  Lord Justice Birss decided that the same was true of the invention in the case before him.   There was nothing technical about the choice of music tracks.   As he put it:

"What makes the recommended file worth recommending are its semantic qualities. This is a matter of aesthetics or, in the language used by the Hearing Officer, they are subjective and cognitive in nature. They are not technical and do not turn this into a system which produces a technical effect outside the excluded subject matter."

This case note greatly simplifies - many would say oversimplifies - the Court of Appeal's decision.   If you want to read it for yourself, click Comptroller General of Patents, Designs and Trade Marks v Emotional Perception AI Ltd [2024] EWCA Civ 825 (19 July 2024.   I have also written a more detailed note entitled Patents - the Appeal in Comptroller v Emotional Perceptions on 26 Aug 2024 in NIPC Law.  Anyone wishing to discuss this article is welcome to call me on  +44 (0)20 7404 5252 during UK office hours or send me a message through my contact form.

How to Value a Patent

Crown Copyright  Open Government Licence 3.0

Jane Lambert

On Thursday 9 May 2024 I attended the Finance and Innovation Conference which took place at the Menai Science Park on Anglesey.  I wrote about my visit in M-SParc's Finance and Innovation Conference on 10 May 2024 in NIPC Wales.  Two of the most interesting conversations were Gwenllian Owen's discussion with a group of business angels and Edward Thomas's discussion with Steve Livingston and representatives of several local financial institutions.  All of those angels and institutions offered funding of various kinds to early-stage enterprises whose assets were likely to consist of little more than a patent or patent application or sometimes just an idea for an invention or business,  A question that I was bursting to ask them was how do you value the assets of such a business?

Because of the very full programme, there was not enough time for me to ask that question to either group of speakers so I decided to research it for myself.  This is what I have come up with.   The short answer is that a patent (or any other intellectual property right for that matter) is what a willing and informed assignee would pay a willing and informed assignor bargaining at arms' length.  I reached that conclusion after reading Valuing Your Intellectual Property which was published by the UK Intellectual Property Office on 12 Dec 2014 and last updated on 4 Jan 2022, How do you measure patent value? published by the European Patent Office and Valuing Intellectual Property Assets published by the World Intellectual Property Organization, the United Nations specialist agency for intellectual property.   The IPO's guidance incorporated the above animation.

Each of those publications refers to three methods of valuations:

• the cost method
• the market value method, and
• the income or economic benefit method.

The "cost method" is the owner's expenditure on developing the intellectual asset and is likely to include such costs as labour, cost or hire of premises, plant and equipment, raw materials, consultancy fees, prototyping and testing and patent prosecution.  The attraction of this method is that the purchaser does not have to incur those costs but the drawback is that the assignor may well have gone about his or her research and development work in the most efficient way.  Also, the IP right may not protect the asset as well as it might.   Expect a lot of horse-trading between the owner and his or her buyer, investor or lender. 

The "market value" method is to compare the proposed transaction with similar transactions relating to similar intellectual assets.   That is likely to be more accurate than the cost method where the relevant information is available because it is about transactions that have actually taken place.  One problem is that the parties may not wish to publish information about their deals.  Another is that the times may have been different.  A transaction that makes sense when interest rates or low or market demand is strong may be unviable now.  Yet another problem is that there may be significant differences between the invention in one transaction and the invention in another.   Also, newly formed businesses or businesses operating in a new technology or market may not be able to point to comparable data,

The "income" or "economic benefit" is the deduction of past and anticipated costs of developing the asset from the past and anticipated revenues that it may have and may continue to generate.  The problem with this method is that it requires a lot of crystal ball gazing and is likely to be subject to a lot of wishful thinking. However, if there are some licensing deals producing verifiable royalties or an income-generating invention it may be the most accurate method yet.   According to the WIPO, the income method is the most commonly used method of valuation.

There are businesses like Ocean Tomo that hold IP auctions from time to time.  I have no personal experience of them so I can neither recommend nor not recommend them. Readers contemplating such services should make their own enquiries, take their own advice and form their own views as to whether an auction would benefit them.

There are also businesses like Inngot which offer valuation services.  Inngot was co-founded by a distinguished academic lawyer who has recently retired as Principal of Bangor University.  I have shared a platform with one of its former employees on two occasions very successfully and have high regard for its publications.  However, I have no experience of its valuation services.

A first step for any business which wishes to value its IP would be an IP audit.  Readers may wish to consult How to Use an IP Audit which I wrote in NIPC News on 13 Jan 2022.  They may also wish to use the IPO's handy IPR Valuation Checklist.   While I do not carry out IP audits myself I can certainly address legal issues that may arise in the course of such exercises such as construing patent claims.   Anyone wishing to discuss this article may call me during office hours on 020 7404 5252 or send me a message through my contact form.

The British Library Inventors' Club

British Library
Author Jack1956  Public Domain  Source Wikimedia Commons

 

Jane Lambert

I am delighted to report that the British Library has set up an "Inventors Club". and I wish its organizers and members every success,  The Club meets on the last Monday of every month. The next meeting will take place between 18:00 and 19:30 on 29 April 2024. According to the Eventbrite registration card, there will be talks by innovators who have already brought their products to market or have licensed their intellectual property,   The organizers are Mr Bob Lindsey who set up and chaired an inventors' club in Kingson and Mr Mark Shehan who has been the British Library's "inventor in residence",

I have written a longer article about this initiative in NIPC London.

Anyone wishing to discuss this article may call me on 020 7404 5252 or message me through my contact page.

Invention Con 2023 - Practical Advice for Inventors, Makers and Entrepreneurs from across the Pond

Author US Patent and Trademark Office Licence Standard YouTube Licence Source USPTP

Jane Lambert

An important difference between the United Kingdom and the United States lies in the public's appreciation of independent inventors. The life of an American inventor is not exactly a bed of roses as the story of the film Joy shows, but it is fair to say that independent inventors in the USA are encouraged in a way that British independent inventors are not.  One of the ways in which they are encouraged is an annual online conference called Invention-Con which I discussed in Invention-Con 2022: The US Patent and Trademark Office's Online Conference for Inventors, Makers and Entrepreneurs on 22 July 2022.

It will be obvious from the video clip above that another Invention Con has taken place since I wrote that article.   This time some of the proceedings have been recorded on YouTube.   They include:

• A welcome from Derrick Brent, Deputy Under Secretary of Commerce for Intellectual Property and Deputy Director of the United States Patent and Trademark Office; 
• A welcome from Vaishali Udupa Commissioner for Patents, 
• Licensing your intellectual property;
• Branding and trademark protection;
• Sean Wilkerson, Robyn James and Eric Peterson: Turning passion to profits; and 
• Understanding Manufacturing.

All those clips are well worth watching.  Much of the information and advice would apply here though it has to be remembered that the USA is a different country with different laws, different institutions and a very different business culture.

In my article, I wrote:

"There is no reason why other countries (including ours) should not stage similar conferences. We do stage events like the British Invention Show but there is nothing like Invention-Con. There is a great need for practical advice on patent, design and trade mark prosecution, grant, equity and loan funding, setting up businesses and scaling up which Invention-Con appears to deliver."

For the last 20 years, I have founded and chaired inventors' clubs, given talks, run IP clinics and given practical advice to independent inventors in this and my other publications.  I think the time has come to consolidate these activities in one place.  I am assembling my articles and case notes into a single pdf manual which will be free to download.   I shall continue to canvass support for a British equivalent to Invention-Con.

Anyone wishing to discuss this article may call me on 020 7404 5252 during office hours or send me a message through my contact form,

How to avoid Entitlement Disputes

 

Jane Lambert

In Disputes over Ownership of Inventions 6 Aug 2015 NIPC South East I wrote:

"According to the Intellectual Property Office at least 30 disputes are referred to its tribunals every year over who should own or be entitled to apply for a British or foreign patent or be named as an inventor (see the table on page 50 of the IPO's Facts and figures for 2013 and 2014 calendar years)."

As I said in the next sentence, disputes over ownership of patents or patent applications are known as "entitlement disputes."  Of the 41 inter partes hearings, and reasoned decisions made without a hearing in 2014 mentioned in that table, 31 were entitlement disputes.  The situation had not changed much by 2018 which is the last year for which I have been able to find comparable statistics.  According to the table on page 60 of Facts and Figures 2018, entitlement disputes accounted for 24 of the 38 inter partes hearings, reasoned decisions made without a hearing and reviews of opinions in 2017 and 21 of the 32 in 2018.

Entitlement disputes are often heartbreaking because they arise from a breakdown of hope and trust and sometimes friendship.   The right to a patent or patent application is contested fiercely even when the patent is clearly invalid or of little commercial value.  There are three types of relationships from which entitlement disputes tend to arise:

• The first is between friends or acquaintances where one of them has a bright idea and the others pitch in to help him or her develop it.   
• The second is where the inventor hires a product design consultant, engineer or some other contractor to help with the product's design or development.
• The third is where the inventor or the original collaborators accept investment from an angel, venture capitalist or some other third party.

In the first situation, the friends or acquaintances fall out when they meet the first hurdle.   That can occur in a variety of ways.  One of them may want to apply for a patent or make a prototype and the others do not because they will have to dip into funds that they had earmarked for other purposes.  The second situation may arise because the inventor and third party fail to draw up a proper consultancy agreement or rely on the standard terms of business of the third party which do not reflect the parties' intentions.   The third situation can arise where the investor has paid for everything and the inventor has contributed nothing other than his or her initials idea but still insists on the application proceeding in his or her name alone.

Each of those situations can be avoided if the parties take independent legal advice and negotiate a written agreement that reflects the parties' intentions before any time or money is committed.   By independent, I mean a barrister, solicitor or patent attorney who is unconnected with the patent attorney who prosecutes the patent application.   I say that because in every entitlement dispute in which I have been instructed the attorney has been instructed by one of the parties.   It is next to impossible to act for a client but also safeguard the often conflicting interests of the other parties.

A properly negotiated and drafted agreement will anticipate the possibility of the parties falling out over minor as well as major issues and provide machinery for resolving them such as expert determination in the case of minor issues and mediation or some other form of alternative dispute resolution in the case of major issues.  Taking independent legal advice may be daunting at a time of rising interest rates and flattening demand but it is chickenfeed in comparison to the costs of the sort of entitlement dispute that I describe in my 2015 article.   And in relation to that article, the only thing that has changed since 2015 has been the costs of litigation which have increased along with everything else,  

So if you are thinking of collaborating on the development of an invention or investing in such a collaboration have a word with me or some other specialist lawyer or attorney first.  If you are unfortunate enough to be caught up in an entitlement dispute, I (or someone like me) may be able to advise you on how to resolve it without going before a hearing officer.   If a tribunal hearing cannot be avoided, you will need some skilled and experienced specialist representation before it.  Once again, there are members of the Intellectual Property Bar Association (of which I am one), the Chartered Institute of Patent Attorneys and specialist solicitors who can help you,

Anyone wishing to discuss this article may call me on 020 7404 5252 or send me a message through my contact page,

Further Reading

For an example of an entitlement dispute, read Jane Lambert Patents - Bionome Technology Ltd v Clearwater 14 Dec 2024 in NIPC Law.