In a recent decision by the Delhi High Court, in the case of Microsoft Technology Licensing, LLC v Assistant Controller of Patents and Designs, the Court reaffirmed that the Guidelines for Examination of Computer Related Inventions (CRI), 2017 (CRI Guidelines 2017), which eliminated the novel hardware requirement, must be applied to determine the patentability of software-related inventions.
Overturning the refusal decision of the Assistant Controller of Patents and Designs (Controller), the Court directed the grant of Microsoft Technology Licensing, LLC‘s (Microsoft) subject patent application (application).
The case revolved around Microsoft Technology Licensing, LLC’s (Microsoft) application for a novel reversible 2D overlap operator to improve the encoding process while maintaining compression quality. This application was rejected by the Controller in 2019.
Microsoft in its appeal finally before the Court, argued that their invention was not a mere computer program but a technical solution to a specific problem. They further contended that the refusal was based on the outdated Guidelines for Examination of Computer-Related Inventions (CRI), 2016 (CRI Guidelines 2016), which required novel hardware to overcome the exclusion of patentability under Section 3(k) of the Patents Act. However, the CRI Guidelines 2017 removed this requirement.
The Controller argued that the invention was solely performed by means of a computer program in C language and being software-based, it squarely falls under the non-patentable category of “computer programs per se” of Section 3(k) of the Patents Act, 1970.
The Court, however, referenced a recent judgement in an SEP dispute, Lava International Ltd. v Telefonaktiebolaget LM Ericsson, to emphasize that an invention incorporating computer programs or algorithms can be considered patentable if it significantly enhances hardware functionality and demonstrates a tangible technical effect or advancement. It must also meet other criteria such as novelty, inventive step, and industrial application.
Additionally, the Court referred to the recent cases of Microsoft Technology Licensing, LLC v The Assistant Controller of Patents and Designs, and Raytheon Company v Controller General of Patents and Designs, to reiterate the inapplicability of the 2016 CRI Guidelines for assessing patentability, and the removal of the novel hardware requirement.
In light of these precedents, the Court observed that the invention has real-world applications and significantly enhances the functionality of the hardware components by enabling efficient and reversible digital media data compression. This directly contributes to reduced storage requirements during processing and hence improves system performance and efficiency of the hardware. Thus, the Court concluded that the application in question did not fall under the exclusions of Section 3(k) and met the criteria for patentability and directed the Controller to grant the application.
The judgement yet again underscores the importance of recognizing technical contributions and practical applications of software inventions, rather than dismissing innovations based solely on their software components. This decision exemplifies the Indian courts’ commitment to ensuring that innovative software-led products and solutions are supported and protected, to foster an environment of technological advancement.