UNIT-V

Administration of Industrial Property (Patent System)

Introduction
The organizational structures which need to be established by the government of a
country for industrial property laws to operate effectively fall into three categories:
 bodies operated directly as part of the government machinery — namely an
Industrial Property Office and a Policy Unit;
 bodies outside the government machinery but which may call for government
supervision namely patent and trademark agents;
 special arrangements in the courts.
The Industrial Property Office is often called the Patent Office for short, even though
it handles trademarks and designs as well as patents. In some countries the three functions
are, for historical or other reasons, operated independently by separate offices, but it is
usually more efficient to combine the functions in one office.
The Industrial Property Office is essentially a government institution. Its precise
position in the government organization as a whole can vary according to the administrative
structure of the government of the country in question.
The Office may be integrated completely into a Ministry concerned, being staffed by
civil servants who can be transferred into and out of the Office from other parts of the
Ministry. The advantage of frequent transfers is that the Office receives a regular intake of
staff with wider experience and perhaps fresh ideas; the disadvantage is that experienced
officials are lost as they move elsewhere.
The Office may be organized as a semi-autonomous body, able to recruit and train its
own staff on its own terms, to control its own fees and other charges and to manage its own
finances. It may then have a management board representing both the government and the
people who use the Office’s services. The advantages are freedom from general government
restrictions on manpower and spending, more freedom to finance investment in new
developments, greater ease in responding to user and consumer interests, and more
retention of experienced staff. The disadvantage, particularly for a small Office, is that the
staff’s career is more restricted and that might affect the quality of the recruits to the Office.
Whatever administrative structure is adopted the Office must be judicially
autonomous. The decisions of the Office to grant, refuse or revoke an industrial property
right, or to resolve disputes between parties, are quasi-judicial decisions, not administrative
ones. The Office must, therefore, be free from any interference in particular decisions, being
answerable only to the court in so far as there is a right of appeal from an Office decision to
the court
The Office must be subject to administrative supervision by the Ministry in charge of
its general performance, on the level of its fees and on the appointment of the head of the
Office or members of any management board. In addition, it is highly desirable to establish
an advisory committee of representatives of user organizations (such as patent and
trademark agents’ institutes, chambers of commerce, industrial federations and consumer
groups).
Administrative Structure in the Industrial Property Office
The managers of many of today’s Industrial Property Offices are increasingly called
upon to plan and organize their operations with optimum efficiency in mind. In recent years,
Industrial Property Offices have become much more active in the promotion and delivery of
services related to the role of industrial property information as important factors for
technological development, in addition to the carrying out of the traditional functions of
search and examination related to the granting of industrial property rights.
Most Industrial Property Offices have also experienced, in recent years, substantial
increases in workloads because of rises in filing rates, which have not always been
accompanied by corresponding increases in human resources. Consequently, managers have
been looking at various ways and means, including automation, to increase the efficiency of
their operations and deliver more with the same or fewer resources. In this context,
managers have been studying different organizational set-ups in order to promote the most
efficient use of their human resources.
The current trend is to group all the industrial property activities under one
authority, since this results in the more efficient use of management skills and the
interchangeability of a certain number of employees, particularly in the support areas. Such
an organizational structure allows having managers with specific technical and operational
knowledge and experience at certain levels but liberates others to concentrate on primarily
management issues. The structure also reduces the number of managers requiring in-depth
knowledge of industrial property. Other advantages are:
 providing a variety of advancement paths for employees;
 possibility of amalgamation of certain functions and avoidance of duplication of certain
others;
 management teams with a variety of experience and background;
 making optimum use of management skills by having them applied over wider areas;
 presents the possibility of shared services, often reducing costs and the amount of
equipment and office space required.
This structure also has some disadvantages — of certain employees having to become
generalists rather than acquiring in-depth experience in any one field, and of certain
managers being called upon to deal with a multitude of areas that are quite different in
nature. Others are:
 because the educational requirements are different in the different sectors, the
employees of one sector can tend to dominate the managerial levels;
 because of fewer management positions at certain levels, there are fewer prospects of
advancement to those levels.
There is also an increasing tendency to merge the industrial property administration with
the copyright administration, as in Indonesia, Malaysia, Mongolia, Singapore and Thailand.
Directorate General
The Directorate General is the authority to which all the organizational centers
report. The actual title of this position may vary as, for instance, Commissioner of Patents,
Registrar of Trademarks, etc., as well as that of Director General. The officer holding this
position is responsible for the management of all operations related to industrial property.
In practically every Industrial Property Office, this responsibility would be too vast
for only one manager. The situation may be handled by the appointment of Deputy Directors
General who are responsible for specific operations, or by dividing the Directorate General
into legal and administrative areas of responsibility.
Industrial Property Operations
Industrial property operations are managed by the various centers under the
Directorate General. These centers are the ones which are involved with the activities
leading to the grant of industrial property rights: they deal as appropriate with patent
examination, trademark examination, industrial design examination, support services,
appeals and oppositions, PCT, documentation and information, automation and programs
and research.
 New developments in IPR

Besides to the most recent developments, in order to bring progressive changes

towards a free market society, rapid liberalization of international trade practices and
demonstrating its commitments to the WTO under the Trade Related Intellectual Property
Rights Agreement (TRIPS), the Government of India undertook a series of steps, to conform
India IP legislation to acceptable international standards. The regulations relating to all
forms of IP have been amended or reissued in recent years, mainly in response to India’s
accession to the WTO. Here are some of these developments in IP legislation in India.
1. Trademark law brought at par with international practices
To bring Indian trademarks law in line with international practices and to
ensure implementation of India's commitments under the TRIPS Agreement, India
replaced the Trade and Merchandise Marks Act, 1958, with the Trade Marks Act, 1999.
Some changes under the 1999 Act are as follows:
 Service marks, for the first time, made protectable through registration.
 The definition of "trade mark" now includes graphic representations, shapes,
packaging and combinations of colours, thereby widening IPR protection.
 The procedure for registration of trademarks expedited by removing the earlier
system of Part A and B registration. In addition, only a single application need
now be filed for registration of a trademark in different classes. The 1999 Act
also provides for the classification in conformity with recognized International
Classification of Goods and Services.
 The period of registration and renewal has been increased from seven to ten
years.
 The definition of "trademark infringement" has been broadened to give
protection beyond the use of identical/deceptively similar marks in relation to
goods for which they are registered.
 An action for infringement of trademark/passing-off can be filed in a district
court within whose jurisdiction the plaintiff (trademark proprietor) resides or
carries on business, as against the earlier law which required the suit to be filed
at the defendant's place.
 Under the new law, both registered and unregistered trademarks can be
assigned with or without the goodwill of the business.
 Recently, by way of the Trademarks (Amendments) Rules, 2014, the fee with
respect to trademark filing has been increased in certain cases. The fee for an
expedited examination have also been increased. Further, the Trade Marks
Registry recently issued an Office Order little with respect to alterations that
may be made to an application for trademark registration. This Order enlists
certain ‘substantial alterations’, which would not be allowed; and other
alterations, primarily clerical in nature that would continue to be accepted by
the Registrar.
2. Protection to Geographical Indications Provided
India has enacted the Geographical Indications of Goods (Registration and
Protection) Act, 1999 (the GIG Act). The GIG Act provides for registration and better
protection of geographical indications relating to goods to help identify the place of
origin of goods, quality, reputation and other distinctive characteristics of these goods.
The GIG Act now helps in protecting unique.
Indian products linked to some geographical region of India, such as Basmati
Rice, Darjeerling Tea, Alphonso Mangoes, Malabar Pepper, Cardamom and Hyderabad
Grapes, which are all well known in the international market. For many years, these
products have been exported on a regular basis, demonstrating India's reputation of
high quality of these products and, therefore, require such protection. Under the GIG
Act, assignment of geographical indications is prohibited, being public property. The
 GIG Act also lays down provisions for infringement actions. The GIG Act helps prevent
geographical indications of goods becoming generic which may otherwise lead to a loss
of distinctiveness and consequently loss of protection.
3. Copyright Law Modified
The 2012 amendments in copyright law, which were made to make Indian
copyright law compliant with the WIPO Copyright Treaty (WCT) and WIPO
Performances and Phonograms Treaty, introduced technological protection
measures, ensured that fair use survives in the digital era by providing special fair use
provisions, made many author-friendly amendments, special provisions for disabled,
amendments facilitating access to works and other amendments to streamline
copyright administration.
The Government is considering further amendments to the Indian Copyright
Act to help deter continuing piracy. Future amendments would provide for greater
deterrents against infringement through more effective legislative and administrative
frameworks. These amendments would also offer the police wider powers to conduct
secret raids, seize and destroy infringing products, provide faster criminal
proceedings and increased punishment for piracy.
4. Patents Law more aligned with TRIPS
Modifications in Indian patent laws have been made in accordance with TRIPS
by widening the list of inventions not patentable, incorporating greater rights of the
patentee, reversing the burden of proof in an infringement suit on process patents
and creating a uniform period of patent protection of twenty years for all categories
of invention.
During 2014, the Indian Patent Office released guidelines pertaining to
issuance of pharmaceutical patents. These guidelines primarily incorporate features
of various court decisions so as to assist the Patent Office in establishing uniform
standards of patent grant/examination. These guidelines are expected to bring in
uniformity with regard to examinations of the patent applications across all Patent
Offices in India and by different responsible officers, in addition to giving to the
inventors and corporates much desired certainty on how their application will be
examined by the Indian Patent Office. Furthermore, in the recent past, various
administrative and procedural mechanisms have been improved in the field of
intellectual property law. The infrastructure of the Indian Patent Office has been
improved greatly, so as to develop facilities for proper management of International
Searching Authority/International Preliminary Examining Authority operation under
the Patent Cooperation Treaty.
Indian Patent (Amendment) Rules 2014 recently introduced a third category
of applicant being of "small entity", and provided procedural rules for governing the
same. Furthermore, the fee for basic patent filing have been revised due to the
introduction of the e-filing system of patents wherein the rates for e-filing are lower
than those involved in physical filing.
5. Protection for Plant Varieties and Rights of Farmers established
India, in giving effect to the provisions of the TRIPS Agreement, enacted the
Protection of Plant Varieties and Farmers Rights Act, 2001, to provide for the
establishment of an effective system for protection of plant varieties. The 2001 Act
recognizes and protects the rights of farmers for their contributions made in
conserving, improving and making available plant genetic resources for the
development of new plant varieties. A variety that conforms to the criteria of novelty,
distinctiveness, uniformity and stability is registrable under law. The 2001 Act
provides for a total eighteen years protection for trees and vines and fifteen years for
other plants.
 6. New Designs Law
India enacted a separate law for the protection of copyrights in an industrial
design. The Designs Act, 2000 repealed the earlier Designs Act, 1911. The new law
protects proprietors of novel or original designs and enforces those rights against
infringers. The new law incorporates the definition of the term "original" to specify
what is a registrable design. In relation to a design, the term "original" includes
designs, which though old in themselves, are new in their application. Any design
which is new or original, not previously published in any country, whether India or
outside India, and which is not contrary to public order or morality is registrable
under the Act. The new Act amplified the definitions of "article" and "design" to bring
them in conformity with internationally accepted definitions for providing wider
protection. Designs do not need to be registered in more than one class, which was
not the case under the earlier law. In view of India's accession to the Paris Convention
and India being a signatory to the WTO, the right of priority has been extended to
countries under the Paris Convention. The initial period for copyright in registered
designs has been extended from 5 to 10 years. The new Act removes the earlier
provisions regarding period of secrecy of the design for two years and enables the
public to inspect any registered design during initial period of existence of the
registration.
7. Integrated Circuits Provisions adopted
In compliance with obligations under the TRIPS Agreement, India has enacted
the Semiconductor Integrated Circuits Layout-Design Act, 2000. This Act provides for
registration of original, inherently distinctive and not yet exploited layout-designs.
Any misuse of a registered layout-design can be prevented by way of an infringement
action. The Act provides a term of protection for 10 years.
Although the Indian IP laws are still in the stages of development but the same
are very much in conformity with the international IP laws as India is a signatory to
international conventions and treaties including Paris Convention for the Protection
of Industrial Property, Berne Convention on Copyright and TRIPS Agreement.
Generally speaking, other than period of protection available and the time and cost
taken to register an IP, there are but a few major differences between Indian and
European IP laws and even those primarily relate to less significant procedural
aspects. However, there have been significant concerns over IP enforcement, with a
backlog of cases at both the civil and criminal courts and IP Offices, and this is the
area where Indian needs to work.

IPR of Biological Systems, Computer Software etc.

“Some 200 million Indigenous people (4 percent of the world population) live in
environments ranging from polar ice and snow to tropical deserts and rain forests. They are
distinct cultural communities with land and other rights based on historical use and
occupancy. Their cultures, economies and identities are inextricably tied to their traditional
lands and resources. Hunting, fishing, trapping, gathering, herding or cultivation continue to
be carried out for subsistence—food and materials—as well as for income” (World
Conservation Union, 2001).
Indigenous Peoples also provide valuable resources and knowledge, about plant and
animal use, including methods of preparation, storage and management, which is of global
economic significance. Their biogenetic resources already form the basis of sizeable seed,
pharmaceutical and natural product industries. Natural resource management, soil fertility
maintenance, stream and coastal conservation and forest and agricultural system models
provide viable, time-tested options for sustainable development adapted to microclimate
variations and local socio-political ecosystems.
 Yet Indigenous Peoples confront increasing external pressures on their lands,
territories, resources, knowledge, innovations and practices. Even the recognition of their
past endowments to world food and medicinal sources, as well as their significant
contributions to agriculture, water and forest management, has done little to offset their
political marginalisation.
Role of Traditional Ecological Knowledge (Tek) In Conserving Biodiversity
Traditional Ecological Knowledge (TEK), as defined by Johnson, covers “a body of
knowledge built by a group of people through generations living in close contact with nature.
It includes a system of classification, a set of empirical observations about the local
environment, and a system of self-management that governs resource use” (Johnson, 1992).
TEK not only refers to Indigenous communities, but also incorporates the knowledge
base of hundreds of millions of members of predominately rural societies who depend on
the natural environment for their livelihood. Their knowledge has been passed on over
many thousands of years, accumulating intricate, detailed and sacred understandings of the
local land to form their cultures and knowledge systems (IUCN, 1997). Traditional
communities relationship with nature is such that the concepts of biodiversity and
conservation are not foreign to them. Instead it is an “integral part of human existence, in
which utilisation is part of the celebration of life” (Posey, 1999). These include notions of
stewardship and totems that are fundamental to biodiversity conservation.
It is vital to incorporate TEK into international law and policy, as it will assist
preservation of local knowledge, encourage participation by these communities in
environmental management and (with prior informed consent) provide a framework for
access and equitable benefit sharing. Age-old practices are not only beneficial to these
communities but also provide examples of appropriate sustainable conservation strategies
displaying efficient management techniques for soil, water, fisheries and forestries, which
have wider applications.
Ownership and Protection of Tek
Ownership and property are Western legal concepts that do not easily transpose into
traditional and Indigenous systems. The notion of transferability is the least compatible
element of property. This is because traditional and Indigenous Peoples identify themselves
within communities who are tied to the land, often based on spiritual connections. There is
often no single identifiable individual that could stand as the property owner of lands and
biological resources.
Hansen and VanFleet (2003), argue that traditional knowledge is usually collective in
nature and is often considered to be the property of the community as a whole:
It is transmitted through specific cultural and traditional information exchange
mechanisms, for example, maintained and transmitted orally through elders and specialists
(breeders, healers, etc.), and often to only a select few people within a community.
The rich and complex systems of traditional knowledge protected and transmitted
through customary law regimes are often undermined by dominant legal systems. Attempts
by Indigenous Peoples to assert and protect their own approaches to TEK, in an increasingly
globalised world, has often taken the form of a debate about the appropriateness, use and
abuse of intellectual and cultural property rights.
Source Code and Object Code
Computers do not understand our language. They only understand 'machine language' or
'machine code' i.e. instructions which consist of a series of 0s and 1s; the language of 'yes'
and 'no'. In the earlier days a computer program used to be written in machine code by
punching a punchcard. The punched slot or unpunched slot indicated requisite information
to the computer. This process was slow and tedious. Such a programme, although intelligible
to the computer, was virtually unintelligible to any one except an equally skilled
programmer.
As the computer science progressed, so did the method of writing computer
programmes. It developed 'assembler languages' and then high-level languages—such as
Basic, Fortran, Cobol, Pascal, c++ etc. They simplify the work of a programmer. The use of
these high level languages enables a programmer to write a programme in terms that nearly
resembles ordinary English, unlike those used in the lower level languages. They also permit
complex operations for the computer to be written by a relatively compact commands. Such
writing of the programme―as written by a programmer―are known as the source code.
The source code is compiled by a compiler―converting it into the language that
computers understand. It is then known as the object code or machine code or binary code
or machine language.
Protection of Source Code
Source code is a kind of description; a description of the computer program. If it is
published then it is a literary work within the Copyright Act and is so protected. If it is not
published then it is protected as a trade secret though only, the writer/ owner of the work
has the right/copyright to publish it.
Proprietary Software
In proprietary software, the source code is generally never published; it is secret: it is
protected as a trade secret.
Copylefted and Open Source Software (OSS)
Everyone is not using copyright or trade secret to prevent others from using computer
software without their permission or preserve their rights. They are using copyright in such
a way that it does not become the exclusive property of anyone. They are not copyrighting
but copylefting it. Copylefting is a new word, new concept.
In order to copyleft a software, the copyright holder publishes the source code with
the declaration that everyone has the right to copy, distribute, and modify the software
without any payment of royalty or fee provided in case of redistribution of the same
software or distribution of the modified software, the source code is also disclosed and
similar freedom—as given by the original copyright holder—is given to the others.
Copylefted software is also called free software as there is freedom to modify it. It is
also called GPLed software as general public license (GPL) has a condition that copylefts a
software.
Software where the source code is disclosed may or may not be copylefted and there
can be degrees of copyleftness: it all depends on the terms of the licence under which it is
released.
In 1997 free software enthusiast got together to start 'Open Source Initiative' (OSI) a
non-profit public organisation. It has come out with ten guidelines. In case license
conditions, under which that software is released, satisfies them then that software is
copylefted to some degree. Software released under the licenses satisfying these guidelines
are known as 'Open Source Software' (OSS).
OSI has also identified licenses that satisfy these condition. Among them, in one
extreme is the GPL that copylefts the software to the maximum and is viral. At other end is
Berkeley Software Distributions (BSD); it copylefts the software to the minimum.
All 'GPLed software’/ ‘Free software’/ ‘copylefted software' are also OSS; they lie
within the sphere of OSS but reverse is not true. In OSS source code is always published: it is
always protected as copyright―subject to the conditions of the license under which, it is
published. In case license conditions are violated then it will also amount to copyright
violation.
Protection of Object Code
The question as to how an object code is protected was debateable. The High Court of
Australia considered this question in Computer Edge Pty Ltd v. Apple Computer Inc, (1986)
161 CLR 171. The court held that the object code is not protected as a copyright. Justice
Gibbs, one of the judges in the majority Observed,
‘I have not found anything … that has persuaded me that [the object code] a sequence
of electrical impulses in a silicon chip not capable itself of communicating anything directly
to a human recipient, and designed only to operate a computer, is itself a literary work, or is
the translation of a literary work within the Copyright Act.’
In India legal provisions were similar. However, before this question could be raised
in our courts, we sorted it out by amending the Copyright Act in pursuance of TRIPS by two
amending Acts namely Act no. 38 of 1994 and Act no. 49 of 1999. The definition of the
'literary work' in section 2(o) of the Copyright Act was amended to include computer
programme as well as computer database. The result is that not only the computer
programme (subject code as well as object code) but computer database is also protected as
a copyright.
Patents
Patentability of computer software is controversial as well as debatable.
Patents can be granted for inventions. The word ‘invention’ {section 2(1)(j) of the
Patents Act} read with the word ‘inventive step’ {Section (1)(ga) of the Patents Act} means a
new product or process that is capable of industrial application. Invention must be novel and
useful. It should not be obvious to a person skilled in the art. It must be a significant advance
in the state of the art; it should not be an obvious change from what is already known.
Generally this is the global law but is being applied differently in different countries (see
Endnote-1, for relevant part of TRIPS).
Law – US
Section 3 of the Indian Patents Act explains what are not inventions. Patents cannot
be granted for discoveries and inventions mentioned in section 3 of the Patent Act. There is
no such limitation in the US law as the Congress intended to include anything under the sun
that is made by man, but the US Supreme Court in Diamond vs. Chakrabarty, 447 US 303: 65
L Ed 2d 144 (the Chakrabarty case) (for the facts, see end note-2) held,
‘This is not to suggest that … [law] has no limits or that it embraces every discovery.
The laws of nature, physical phenomena, and abstract ideas have been held not patentable.
Thus a new mineral discovered in the earth or a new plant found in the wild is not a
patentable subject matter. Likewise, Einstein could not patent his celebrated law that
E=mc2; nor could Newton have patented the law of gravity. Such discoveries are
manifestation of nature, free to all men and reserved exclusively to none.’
The US Supreme Court in Parker v. Flook (437 US 584: 57 L Ed 2d 451) also held that
a method for updating alarm limits during catalytic conversion, which is a mathematical
formula, is not patentable.
The US Patents Act neither specifically refers to programmes for computers, nor to
the business methods. The US Supreme Court in Gottschalk v. Benson, 409 US 63: 34 L Ed 2d
273 (the Gottschalk case) held that a computer program—involving a method to convert
binary-coded-decimal numerals into pure binary numerals — cannot be patented for the
reason,
 The method was so abstract as to cover both known and unknown uses of the binary-
coded-decimal to pure binary conversion;
 The end use could vary and could be performed through any existing machinery or
future-devised machinery or without any apparatus;
 The mathematical formula involved had no substantial practical application except in
connection with a digital computer; and
 The result of granting a patent would be to improperly issue a patent for an idea.
 In short, algorithm cannot be patented. A computer program — standing alone or by
itself — cannot be patented in the US, but what would be the position if it were a part of
an industrial or business process?
Industrial Process
Diamond v. Diehr, (1981) 450 US 175: 67 L Ed 2d 155 (the Diehr case) was a case
involving a process for curing rubber that included a computer programme. Rubber in a
mould is to be heated for a given time according to the Arrhenius equation, named after its
discoverer Svante Arrhenius. The inventor had found a process for constantly measuring
temperature inside the mould, which was fed to a computer that opened the mould at the
right time. The court by a five to four decision held that a patentable claim does not become
unpatentable merely if it uses a mathematical formula, or a computer programme, or a
computer. In short, a computer programme may not be patentable as such but may be
patentable as a part of an industrial process.
Business Methods
Traditionally, the processes concerned with technology only could be patented. Many
other activities including business methods, or data analysis which one would consider
processes, were excluded from patents. However, since the Diehr case, there has been a shift
in the US. US Patent and Trade Office (USPTO) has issued a Manual of Patent Examining
Procedures containing guidelines for patenting inventions. Its earlier policy for computer
related inventions {Paragraph 706.03(a)} was as follows {See Hotel Security Checking Co. v.
Lorraine Co., 160 F. 467 (2nd Cir. 1908) and In re Wait, 24 USPQ 88, 22 CCPA 822 (1934)}:
‘Though seemingly within the category of a process or method, a method of doing
business can be rejected as not being within the statutory classes.’
This was deleted and a new paragraph {706.03(a)} was added,
‘Office personnel have had difficulty in properly treating claims directed to methods
of doing business. Claims should not be categorized as methods of doing business. Instead
such claims should be treated like any other process claims’.
The aforesaid change was noticed by the US court of appeal in State Street Bank v.
Signature Financial Group, 149 F. 3d 1352 (the StateStreet case) (for facts see Endnote-3)
and the court held that,
‘Whether the claims are [patentable or not] should not turn on whether the claimed
subject matter does “business“ instead of something else.’
The court also held that,
‘To be patentable an algorithm must be applied in a “useful“ way.
…
We hold that the transformation of data, representing discrete dollar amounts, by a
machine through a series of mathematical calculations into a final share price, constitutes a
practical application of a mathematical algorithm, formula, or calculation, because it
produces a useful, concrete and tangible result’
In short, at present the law in the US is that, an abstract idea by itself never satisfies the
requirements of the Patents law. However an abstract idea when practically applied to
produce a useful, concrete and tangible result satisfies it.
Today, USPTO has one chapter on Patent Business Methods and is granting patents to
software techniques for business methods and data analysis, if they are useful. Australia and
Japan have also followed suit. Some examples of patents of business methods granted in the
US are:
 Single click to order goods in an on-line transaction. This is famous Amazon 1-click
patent. It was ruled invalid by USPTO on 9.10.07 {To read the original document, go
to USPTO PAIR, choose the "Control Number" radio button, enter 90/007,946 and
submit. Choose 'Image File Wrapper' and select 'Reexam - Non-Final Action' of the date
and download).
 An on-line system of accounting;
 In-line rewards incentive system;
 On-line frequent buyer programme; and
 Programmes letting customers set their own prices for hotel booking etc.
However in US, the law whether a computer programme, in conjunction of business methods
is patentable or not, is far from settled. The Federal circuit Court in 'In re Bilski case' has on
1st October 2007 ordered rehearing of the State Street Case framing the following five
questions:
1. Whether claim 1 of the 08/833,892 patent application claims patent-eligible subject
matter under 35 U.S.C. § 101?
 2. What standard should govern in determining whether a process is patent-eligible
subject matter under section 101?
3. Whether the claimed subject matter is not patent-eligible because it constitutes an
abstract idea or mental process; when does a claim that contains both mental and
physical steps create patent-eligible subject matter?
4. Whether a method or process must result in a physical transformation of an article or
be tied to a machine to be patent-eligible subject matter under section 101?
5. Whether it is appropriate to reconsider State Street Bank & Trust Co. v. Signature
Financial Group, Inc., 149 F.3d 1368 (Fed. Cir. 1998), and AT&T Corp. v. Excel
Communications, Inc., 172 F.3d 1352 (Fed. Cir. 1999), in this case and, if so, whether
those cases should be overruled in any respect?
Law – Europe
Article 52(2)(2) of the European Patent Convention 1973 (EPC) specifically states
that ‘schemes, rules and methods for performing mental acts, playing games or doing
business, and programmes for computers’ will not be regarded as inventions. This is also the
law of the member countries of the European Patent convention: computer programmes and
business methods cannot be patented there. However in practise, it is not so. : they are
generally being granted
The European Patent Office (EPO) is an organization formed by the EPC; it does not
work under the European Commission. The EPO and a number of patent offices of the EPC's
member countries have been granting software patents if claims are presented as
technological advancement rather than just software or business applications. However,
there is no consistent practice among them. Nevertheless, the EPO claims that:
 It does not grant patents for computer programmes or computer-implemented
business methods that do not involve a technical contribution.
 Its practice to grant software patents is significantly different from that of the USPTO.
In order to harmonise the practise, the European Commission proposed a draft
directive in 2002 on the subject. But the text was never agreed upon. Some feared that
Europe would get a much more liberal regime, like that of the US. Others feared that they
would lose the patent protection they already enjoyed. As a result, on 6th July 2005, the
proposal was defeated in the European Parliament. However this means that the
inconsistent practice that caused the Commission to seek to clarify the law is still continuing.
Law — UK
The question regarding patentibility of computer software was debated and decided
in England in In re Astron Clinica Ltd. It concerned six applications that claimed to be 'a
method of doing X' and 'a device for doing X' by running a suitably programmed computer
on the device. It is in effect, a computer programme that carries out the method (for facts of
Astron Clinica case, see Endnote-4). These applications were rejected by United Kingdom
Intellectual Property Office (UKIPO).
Justice Kitchin of the High Court of Justice, Chancery division noted the difference in
practise in applying patent law in European countries by stating that:
'UKIPO considers such claims to be prohibited by Article 52 of the European Patent
Convention (EPC). The EPO considers such claims to be allowable if the program has the
potential to bring about, when running on a computer, a further technical effect which goes
beyond the normal physical interactions between the program and the computer.'
(paragraph 1)
...
'it is highly undesirable that provisions of the EPC are construed differently in the
EPO from the way they are construed in the national courts of a Contracting state.'
(paragraph 49)
The court held that:
'In all these circumstances I have reached the conclusion that claims to computer
programs are not necessarily excluded by Article 52. In a case where claims to a method
performed by running a suitably programmed computer or to a computer programmed to
carry out the method are allowable, then, in principle, a claim to the program itself should
also be allowable. I say "in principle" because the claim must be drawn to reflect the features
of the invention which would ensure the patentability of the method which the program is
intended to carry out when it is run.
...
It follows that these appeals must be allowed. Each concerns a computer related
invention where the examiner has allowed claims to, in effect, a method performed by
running a suitably programmed computer and to a computer programmed to carry out the
method. The Hearing Officer has rejected corresponding program claims on the basis they
are necessarily prohibited by Article 52. For the reason I have elaborated, he erred in law in
so doing. These cases must be remitted to UKIPO for further consideration in the light of this
judgement.'
Law – India
Section 3 of the Patents Act provides what are not invention and cannot be patented.
Section 3(k) provides that a mathematical or business method or computer programme per
se or algorithms is not invention for purposes of the Patents Act (see Endnote-5). The word
'computer programme' is modified by the word ‘per se'. This word means standing alone, or
by itself, or in itself. It shows that under section 3(k) a computer programme standing alone
or by itself can not be patented. Nevertheless it also means that if a computer programme is
not standing alone then it may be patented; it leaves doubts regarding its scope. The courts
may interpret it in the same manner as the Europeans are doing or could do all the way as is
being done in the US: of course its finer boundaries will be determined when courts actually
interpret these words.
Patents – Some Difficulties
Period
Many feel that patents may not be granted for doing business on the Internet and in
any case the period of 20 years is too long as computer technology changes every two years
(see ‘Patently Absurd‘ by James Gleick is available at http://www.around.com/patent.html).
Method of patenting
Presently, patent applications for inventions involving computer programme merely
contain flow chart but not the source code. Patents are granted in exchange for a full
description of the invention as well as how to perform it. In case source code is not disclosed
then whether there is full disclosure. These questions need to be addressed judicially.
Software Patents―To be or Not to be
Many feel that patents may not be granted for doing business on the Internet and in
any case the period of 20 years is too long. The question regarding patentibility of computer
software or the period for such patentibility should be settled globally. The sooner it is done,
the better it would be for the computer software industry.
What may be done till the law is settled: get your software patented. In case it cannot
be done due to time or expenses involved, publish it on the website. This would indicate
prior art and at least others will not be able to get it patented.
Conclusion
Michael Lewis wrote a book in 1999 on the success story of the Silicon Valley entitled
‘The new new thing: a Silicon Valley story‘. The most quoted line from this book is,
‘The definitive smell inside a Silicon Valley start-up was of curry.‘
Let’s hope that—with a better understanding of role of IPRs in the computer industry—not
only inside a Silicon Valley start-up, but also inside the e-World, will there be the smell of
curry.
Endnote-1: Clause 27 of the TRIPS defines patentable subject matters. The relevant part of
sub-clause (1) of clause 27 is as follows:
Subject to the provisions of paragraphs 2 and 3, patents shall be available for any inventions,
whether products or processes, in all fields of technology, provided that they are new,
involve an inventive step and are capable of industrial application.
A footnote is inserted here in the TRIPS states,
For the purposes of this Article, the terms "inventive step" and "capable of industrial
application" may be deemed by a Member to be synonymous with the terms "non-obvious"
and "useful" respectively.
Endnote-2: Plasmids are hereditary units physically separate from the chromosomes of the
cell. In a prior research, Chakrabarty and an associate discovered that plasmids control the
oil degradation abilities of certain bacteria. In particular, the two researchers discovered
plasmids capable of degrading camphor and octane, two components of crude oil. In the
work represented by the patent application at issue here, Chakrabarty discovered a process
by which four different plasmids, capable of degrading four different oil components, could
be transferred to and be maintained stably in a single Pseudomonas bacterium, which itself
has no capacity for degrading oil. The new bacteria were not ‘products of nature‘, because
Pseudomonas bacteria containing two or more different energy generating plasmids are not
naturally occurring.
At present, biological control of oil spills requires the use of a mixture of naturally
occurring bacteria, each capable of degrading one component of the oil complex. In this way,
oil is decomposed into simpler substances which can serve as food for aquatic life. However,
for various reasons, only a portion of any such mixed culture survives to attack the oil spill.
By breaking down multiple components of oil, Chakrabarty’s micro-organism promises more
efficient and rapid oil-spill control and his patent application was allowed.
Endnote-3: Signature was the assignee of the patent. The patent was for data processing
system (the system) for implementing an investment structure. The system was developed
for use in Signature's business as an administrator and accounting agent for mutual funds.
The investment configuration provided the administrator of a mutual fund with the
advantageous combination of economies of scale in administering investments coupled with
the tax advantages of a partnership.
State Street negotiated with Signature for a license to use its patented data processing
system. When negotiations broke down, State Street filed a case for declaration that the
patent is invalid. This was allowed by the Massachusetts district court. This judgement was
in appeal that was allowed and the case was remanded. It later on ended in compromise.
Endnote-4: The facts in the application filed by Astron Clinica are as follows:
 University of Birmingham had developed skin imaging techniques. Astron Clinica was
founded to commercialise it.
 The technique enables images of the skin to be processed to identify the distribution
and concentration of underlying skin chromophores.
 Distribution and concentration of underlying skin chromophores undergoes a change
in case of cosmetic or surgical intervention.
 The application filed by Astron Clinica describes the invention as providing a system
and process for generating realistic images representing these changes. It is
implemented by programming a computer to process images in a particular way. This
is achieved by a disc that causes a computer to be configured so as to undertake the
required processing.
Similarly, computer programme was used in the other cases.
Endnote-5: Section 3(k) as it stands today was substituted by the 2002 Amendment. It was
replaced by section 3(k) and 3(ka) by the Patents Amendment Ordinance 2004 (the 2004
Ordinance). Section 3(ka) as substituted by the 2004 Ordinance excluded mathematical
method or business method or algorithms from the field of invention. It was the same as was
provided by the 2002 Amendment in Section 3(k). However, the law regarding computer
programme was further clarified in section 3(k) by the 2004 Ordinance. After the 2004
Ordinance, computer programme per se was further qualified by the phrase 'other than its
technical application to industry or a combination with hardware'. It showed that the
computer programme in its technical application to industry or a combination with
hardware only could be patented: a scope narrower than US approach but perhaps wider
than European approach. The 2004 ordinance has been repealed by the Patents Amendment
Act 2005 (Act 15 of 2005) (the 2005 Amendment) however it left the section 3(k) as was
substituted by the 2002 Amendment intact; it did not incorporate the amendments in 3(k)
or substitution of 3 (ka) as proposed by the 2004 Ordinance.

Traditional knowledge Case Studies, IPR and IITs

In 1995, two expatriate Indians at the University of Mississippi Medical Centre were granted
U.S. Patent 5,401,504 on Use of Turmeric in Wound Healing. The claim covered “a method of
promoting healing of a wound by administering turmeric to a patient afflicted with wound”.
This patent also granted them the exclusive right to sell and distribute turmeric. Initially,
this news was a disbelief and surprise by many people in India.
In India, the turmeric has been “a classic grandmother’s remedy”, applied to cuts of children
as an anti-parasitic agent, used as a blood purifier and in treating the common cold for
generations. It is also used as an essential ingredient in many Indian dishes. It is part of our
traditional knowledge. So, the question was how could someone get an exclusive right to sell
and distribute turmeric?
In 1996, The Council of Scientific & Industrial Research (CSIR), India, New Delhi requested
the US Patent and Trademarks Office (USPTO) to revoke the patent on the grounds of
existing of prior art. CSIR did not succeed in providing that many Indians already use
turmeric for wound healing although turmeric was known to every Indian household for
ages. Fortunately, it could provide documentary evidence of traditional knowledge including
ancient Sanskrit text and a paper published in 1953 in the Journal of the Indian Medical
Association. The patent was revoked in 1997, after ascertaining that there was no novelty.
Now, what is exactly mean by Traditional knowledge?
Traditional knowledge refers to knowledge, innovations and peculiar practices developed
from experience gained over centuries and adapted to the local culture and environment. It
is mostly information held in human memories and not written down. Traditional
knowledge systems do not act in isolation and include spiritual experiences, philosophies,
politics, and technologies and strongly influenced by the indigenous traditions. The holder of
traditional knowledge is the community that has unwritten customary laws which manage
the access and use of traditional knowledge. This knowledge is vast enough to encompass
categories like, agricultural knowledge, medicinal knowledge, biodiversity-related
knowledge, and expressions of folklore in the form of music, dance, song, handicraft, designs,
stories and artwork.
In 2000, WIPO members established an Intergovernmental Committee on Intellectual
Property and Genetic Resources, Traditional Knowledge and Folklore (IGC), and in 2009
they agreed to develop an international legal instrument (or instruments) that would give
traditional knowledge, genetic resources and traditional cultural expressions (folklore)
effective protection.
How can we protect Traditional knowledge?
Only after the patenting of turmeric, neem and Basumati rice, India and many developing
biodiversity rich country woke up to the danger that the traditional knowledge was faced
with. Two types of intellectual property protection are being sought:
Defensive protection and Documentation of Traditional Knowledge: aim to prevent
people outside the community from getting intellectual property rights over traditional
knowledge. India has compiled a searchable database of traditional medicine Traditional
Knowledge Digital Library (TKDL, http://www.tkdl.res.in/) that can be used as evidence of
prior art by patent examiners when assessing patent applications. Defensive strategies
might also be used to protect sacred cultural manifestations like sacred symbols or words
from being registered as trademarks. Documentation helps in preservation, dissemination,
use and management of this knowledge rather than for the purpose of legal protection.
There are also concerns that documentation could lead to misappropriation.
Positive protection is the granting of rights that empower communities to promote their
traditional knowledge, control its uses and benefit from its commercial exploitation. Some
uses of traditional knowledge can be protected through the existing intellectual property
system, and few countries have also developed specific legislation.
Can trade secret protection be applicable to Traditional knowledge?
There are many traditional knowledge systems that operate through groups or communities
or individuals assert and maintain their knowledge through secret regime, especially in the
context of medicinal knowledge. The reason being,
1. Personalised nature of the healing process can induce a de facto private knowledge of
botanical resources. For the healer, these secret plants are a symbolic extension of his
secret knowledge.
2. A lot of traditional knowledge have been accumulated and codified and are available in
Sanskrit, but many of it have been transmitted through secret oral instructions in
various traditional medical lineages.
Is there a need for alternative regime for the protection of Traditional knowledge?
Due to difficulties identified in the application of intellectual property to traditional
knowledge including traditional medicines, there have been calls for establishment of
the sui generis (specific, special) systems for the protection of traditional knowledge. In the
domain of pharmaceutical research, traditional knowledge contributes towards the
identification, development and appropriate dosage of the drug. This useful information is
accumulated through consistent skill, observation and usage by local and indigenous
communities. However, the conventional intellectual property systems do not recognise this
as valuable “innovation”. Access to such information is assumed to be “free”.
This has prompted some countries to develop their own sui generis systems for protecting
traditional knowledge. However, the parameters and modalities are being worked out. The
broad objectives under sui generis systems would be determination of protectable subject
matter, ownership rights and procedure for acquiring rights.
Furthermore, sui generis systems protected under national law may not hold true for other
countries. Therefore, many indigenous, local communities and governments are pressing for
an international legal instrument. Recognizing and valuing traditional mode of creativity and
innovation as protectable intellectual property would definitely be an historic shift in
international law, empowering indigenous communities as well as governments to have a
say over the use of their traditional knowledge by others.
Neem: The Neem tree is a native evergreen species of tropical countries like India and other
such Southeastern countries. Neem is called as “the village pharmacy” in India for its healing
property and it is used in medicine and mostly in Ayurveda from its very beginning, it can be
said to be in use for a period of more than 4000 years ago. The Neem is called as “Arista”
which is a Sanskrit word which means imperishable or complete. Not only the Neem leaves
are used in medicine but the tree itself is used in medicine. It is used as inti-inflammatory,
anti-pyretic, antiseptic, anti-fungal, antiviral medicines.
Bio-piracy: The term bio-piracy means the theft of several genetic resources and materials
mainly the plant varieties in the form of obtaining patent. Once a material is patented, the
owner could possibly prevent that thing form being recovered by any other person even
though the one is real owner of that property. Thus, by patenting the traditional knowledge
of indigenous people the corporate can restrict the people from use of their own traditional
knowledge and thus it affects the livelihood of native people.
Problem raised in Neem Patent: In the year 1971, a timber importer form US imported
neem seeds to plant neem trees in his headquarters in Wisconsin. He also conducted
performance and safety tests upon the pesticidal properties of neem and got clearance from
the US Environmental Protection Agency known as EPA. After three years he sold the patent
to a multinational corporate company which is known as W R Grace and Co. and by the year
1985, several US and Japanese corporations were trying to find and formulation of
emulsions for toothpaste production it of Neem. Subsequently in the year 1992, the
corporate W R Grace and co claimed rights for the pesticide emulsion begotten out of Neem
seeds. And by this, it began to sue Indian companies for making such emulsions.
Dispute: According to India‟s claim, it was stated that Neem is an indigenous product and it
is still in practice as a form of traditional knowledge in India. It was also said that Neem if
granted patent it would affect the poor farmers and by this the Indian economy will also be
harmed.
Neem campaign in India: A group of individuals and several NGO‟s initiated their Neem
campaign and this was done to mobilise the worldwide people for support and to protect the
traditional knowledge systems and also protect Indian traditional products from biopiracy.
The Neem Case was the first initiative to challenge US and European patents with regard to
biopiracy.
Case judgement: On July 30,1997 the European Patent Office (EPO) accepted the arguments
of Indian scientists thus this resulted in rejection of patent granted by the iUS patent office to
W R Grace and co. The argument which was accepted on whole was the use of Neem and its
products in India for a period of more than 4000 years.
Use of turmeric in India: Turmeric is a tropical herb and used widely in India as a cosmetic
agent and also used mostly in all dishes in India as a colouring agent. The turmeric powder
has a deep yellow colour and a slight bitter taste when raw.
Patent issue and Turmeric: In the year 1995, US Patent was awarded to Medical centre Of
University of Mississippi for the use of wound healing property of turmeric.
India’s claim: Dr. R.A.Mashelkar who was the Director of Council of Scientific and Industrial
research (CSIR) during period of 1995 to 2006 opposed the patent granted to the Medical
centre of Mississippi university and worked hard for awakening India‟s traditional
knowledge of Turmeric.
Arguments by Indian scientists: The claim was supported by documentary evidence which
was an old newspaper dated 1953 printed and published by Indian Medical Association, and
there were also evidences produced which includes old and ancient texts in Sanskrit.
Judgement: In 1998 April, the judgement favoured CSIR which was based on the argument
that was proved with string documentary evidence that Turmeric was being in use by Indian
people since ancient period of time.
Conclusion
The traditional knowledge is something that should be protected as a valuable asset as it is
the basic form of indigenous and local communities’ livelihood. Traditional knowledge also
supports Indian economy since most of the tested traditional knowledge which are used for
production of certain novel products have commercial value. Through the traditional
knowledge, the agriculturalists conserve and maintain the biodiversity and make sustainable
agricultural practices. The documentation of traditional knowledge prevents the chances of
bio-piracy whereby the native traditional knowledge is prevented against misuse and
misappropriation of our products by third parties. Thus, there must be updation of
Traditional knowledge Digital Library (TKDL) periodically and a headquarters should be
maintained by a team either by the Central or by the State government. The traditional
knowledge of all indigenous products and ideas out of those products should also be a feed
in the TKDL. India as a developing country while concentrating in development should also
concentrate in protecting the inborn knowledge of country as well.