06 October 2021
In this article for The Patent Lawyer, Mathys & Squire partner Dani Kramer and associate Dylan Morgan review the response of patent offices to blockchain filings with a particular focus on the United Kingdom Intellectual Property Office (UKIPO), the European Patent Office (EPO), and the United States Patent and Trademark Office (USPTO).
In the last decade or so, blockchain has become an area of increasing interest both commercially and from a patenting perspective. While blockchain has not yet become a part of daily life for most people, the technology can be applied to many fields and offers the potential to improve various existing technologies. Unsurprisingly, many companies are keen to protect their blockchain developments via patents.
Throughout this article, comparisons between patent offices will be drawn in particular by comparing the treatment of exemplary patent families in the various offices. In general, most of these jurisdictions seem to be amenable to blockchain filings. The exception to this is the UKIPO, which has granted relatively few blockchain patents and has objected to many applications on the basis of unallowable subject matter. Thus, at least for the time being, applicants seeking protection for blockchain inventions in the UK might be best served by pursuing patent protection via the EPO.
The majority of patent offices have yet to rule on the patentability of blockchain in any seminal cases, and present guidance from patent offices is typically that blockchain inventions should be treated the same as other computer-implemented inventions.
For example, in a conference report titled ‘Talking about a new revolution: blockchain’ from 4 December 2018, the EPO set out its position that: “… blockchain inventions are essentially computer-implemented inventions (CII), so they are examined by the EPO according to established stable criteria, developed in accordance with CII case law.”. “Realising that blockchain inventions are in fact CII is a big relief,” said Lievens. “We are on known territory. We know how to do this. Applicants will have legal certainty and will get what they expect.”
Other patent offices have taken similar positions, that blockchain inventions should be treated much the same as any other computer-implemented inventions.
Of course, in practice different types of computer-implemented inventions can be treated rather differently by different patent offices. Below, we have compared the treatment of blockchain filings by certain offices to identify any discernible trends.
There have been hundreds of blockchain filings at the UKIPO, with most of these applications being filed within the last five years. Many of these applications have not yet received search or examination reports and so there is a limited pool of filings from which conclusions can be drawn.
However, enough applications have been examined to observe an apparent pattern of UK blockchain filings being rejected on the basis of unallowable subject matter.
An indicative application is GB2555496A, filed in 2017 by Trustonic. Corresponding applications have been filed in Europe (EP3312756B1) and the US (US20180114220A1) – and these applications will be commented upon later.
In a first examination report for the UK application, the Examiner stated:
“I note that the US equivalent to this application has been abandoned following significant amendment, and the EP equivalent granted again following significant amendment (note conflict warning below.) Given also the substantive excluded matter objection, which would not in my view be addressed by either the US or EP form of claims, I have not therefore at this stage completed an updating top up search on this application.”
While this application is still pending, it seems that overcoming these objections will be challenging. This examination report is also interesting because it succinctly expresses a number of conclusions that are borne out of our review of other UK filings. In particular:
This being said, certain companies have managed to secure patent protection for blockchain inventions at the UKIPO (e.g. via GB2549085B and GB2561107B).
Filings that manage to achieve grant in the UK are typically linked to a physical system or input; for example, the claims of GB2561107B require the obtaining of biometric data and the comparison of this biometric data to a biometric hash.
As will be apparent from the Examiner’s comments in the UK examination report cited above, the EPO is generally more amenable to blockchain inventions than the UKIPO.
Indeed, for EP3312756B1 (the EP filing in the above-mentioned Trustonic patent family) the Examiner’s objections were almost entirely related to novelty and inventive step, with the patentability per se of the subject matter attracting very little attention.
This trend is played out across European patent filings. Novelty and inventive step tend to be the determining factors, with patentable subject matter tending to be of subsidiary relevance. This is partially due to the way in which the EPO approaches inventive step – and as with all applications, non-technical aspects are of limited relevance during the determination of an inventive step – but, as a general rule, the EPO seems willing to consider blockchain technologies as being technical and to more readily grant blockchain patents.
Another application that illustrates this difference in approach between the EPO and the UKIPO is EP3577593B1, which was filed by PHM Associates in 2018 claiming priority to a GB application filed in 2017. On the face of it, this is a fairly innocuous European application. Following entry into Europe via a Patent Cooperation Treaty (PCT) application, the Examiner raised various novelty and inventive step objections. Once these were overcome, a patent was granted by the EPO.
Conversely, the corresponding UK application GB2566741A has thus far received a total of four examination reports from two different examiners, with each of these examination reports objecting to the claims as relating to unpatentable subject matter.
Turning then to an application that has fallen foul of EPO subject matter objections, EP3376456A4 is an application filed by Nippon Telegraph and Telephone Corp in 2016 that relates to the determination of whether a party is qualified to add blocks to a blockchain. This application has been refused by the EPO Examining Division and is currently under appeal.
Justifying the refusal, the Examining Division stated:
“The present application relates to decisions for granting the right to generate the next block in a blockchain as typically used in cryptocurrencies such as Bitcoin.”…
“This problem is addressed by a blockchain generation and verification method in which the decision for granting the right to generate the next block in a blockchain is based on the number of “transaction patterns”, i.e. the number of transactions with different transaction partners in which a party has participated (e.g. determined in the form of the sum of the number of unique identifiers of transaction partners in the transaction datasets). This is regarded as an index of trustworthiness of the generating party based on the assumption that a transaction is conducted with trust on the transaction partner built by revealing each other’s identities and knowing who the transaction partner is. …”
“The problems which are thus addressed do not appear to refer to a technical solution of a technical problem, but rather address business-related or behavioral considerations for the selection of a parameter in a consensus algorithm.”
This decision makes it clear that not all blockchain applications will be considered by EPO examiners to be technical in nature and hence allowable by the EPO. In particular, those applications that are interpreted to be business methods per se (and inventions relating to consensus mechanisms might be at increased risk of this) are likely to face difficulty at the EPO, unless – as with any computer-implemented or business method invention – it is possible to demonstrate a clear technical effect. As mentioned above, this application is currently under appeal, and the outcome of this appeal might well have implications for future blockchain applications.
In summary, the EPO has shown itself willing to grant blockchain patents – but applicants should be careful in particular to avoid straying towards business methods.
Turning to US practice, it is useful to consider again the patent families that have been mentioned previously – the Trustonic, PHM, and Nippon families.
The US application in the Trustonic family (US20180114220A1) received a first Office Action that raised numerous patentability objections. The claims were rejected under 35 USC § 101 as being “Certain Methods of Organizing Human Activity”.
Following a response from the applicant, and the issuance of a subsequent final Office Action, the application was abandoned.
Relevant extracts from that final Office Action include:
In contrast, the US application in the PHM family has received no subject matter objections under 35 USC § 101. Similarly, the US application in the Nippon family received no subject matter objections under 35 USC § 101 and has recently proceeded to grant.
While the Trustonic US application received subject matter objections, it is notable from the above extracts that these objections do not focus on the blockchain aspects. Furthermore, the case file contains an Examiner’s summary of an applicant interview that suggests the objections could have been overcome with further amendments.
More generally, it is notable from a review of US applications that the ‘abstract idea’ objections faced by blockchain inventions at the USPTO seem more likely to be surmounted than subject matter objections at the UKIPO or EPO. For example, US10291627B2 is a patent filed by ARM in 2016 and granted in 2019 and US10803022B2 is a patent filed by Uledger in 2018 and granted in 2020. Each of these filings faced initial subject matter objections that were overcome via amendment and argumentation.
Comparatively, blockchain filings seem to be viewed relatively favourably by the USPTO – and in many cases where subject matter objections have been raised, it has proved possible to overcome these objections.
In summary, most patent offices seem to be willing to grant blockchain patents – and although they have not been discussed here, the China National Intellectual Property Administration (CNIPA) and the Japanese Patent Office (JPO) also seem to be willing to grant such patents.
As with other computer-implemented inventions it is helpful to show a clear technical effect and to illustrate that any claimed method could not be performed by humans. And as with other computer-implemented inventions, applications that stray too far towards pure business methods are at particular risk of receiving subject matter objections.
The UKIPO is perhaps a notable outlier that views blockchain filings somewhat unfavourably. Therefore, where UK protection is desired it might well be beneficial to seek patent protection by filing an application at the EPO.
This article was published in The Patent Lawyer Magazine in October 2021.
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