Thursday, 3 October 2013

Approaching a software patent cliff?

“Is software patentable in Kenya?” This was a question posed at a conference held in Nairobi last year. In this Leo’s opinion, the answer is “yes”, primarily because of a change in the Kenyan patent law in 2001. The old law explicitely excluded software from patentable subject matter, but the revised law conspicuously omitted the exclusion (conspicuous because other exclusions were maintained). If it was once prohibited, but is no longer, then it must be allowed, right?

driving buffalo over the cliff

charles marion russell 

“Should software be patentable in Kenya?” The same conference also posed this question, which is decidedly more difficult to answer. This post focuses on one aspect of the question, namely, whether the current system is likely to replicate the mess that patents have made in the software industry in the United States.

Software patents in the US are hard to define, are numerous in number, and are the subject of endless debates about patentable subject matter. The US courts have completely changed their treatment of such patents at least three times, making it difficult to know at any given time whether a patent is valid or invalid. More problematic is the contention that, during the ‘90s and 2000s the USPTO issued a large number of broad patents that cover many of the most basic online or mobile operations. Furthermore, such patents are frequently categorized as “weak” patents – i.e., patents that barely pass (or probably do not pass) a requirement for patentability such as non-obviousness. Nevertheless, or as a result, such patents are often used by Non-Practicing Entities (i.e., “patent trolls”) to sue large numbers of defendants, confident in the belief that most defendants will prefer to settle out of court for just less than it will cost to litigate.

Is Kenya heading in this direct? The potential is serious for two reasons. The first reason is the importance of the software industry to Kenya. The phenomenal growth of the industry in the last 5 years is unmatched in any other sector, and ICT offers substantial opportunities for high-paying jobs and entrepreneurship.

The second reason is the existence in Kenyan IP law of Utility Model Certificates. “Normal” patents are granted for inventions that are novel, useful, and, critically, non-obvious (or, if you are in Europe, involve an inventive step). Thus any patent system can theoretically weed out “weak” patents before they even become patents simply by rigorously enforcing the rules for granting patents. Weak patents tend to be for obvious inventions, so enforcing the non-obviousness criteria should limit their number.

Utility Model Certificates, on the other hand, are granted for inventions that are merely novel (and useful) – there is no requirement for non-obviousness. Almost by default, then, they are granted for obvious inventions; if the invention is non-obvious the applicant is more likely to file for a regular patent. A Utility Model certificate provides exclusionary rights for “only” 10 years. In the software industry, 10 years is still much longer than the useful lifespan of most inventions.

So, by design of the law, Kenya is destined to have a collection of intellectual property rights granted to novel but obvious inventions, including inventions in software. These are key elements in building a system ripe for exploitation by Non-Practicing Entities.

To date, the number of software-based utility model (or patent) applications filed in Kenya is very low. Nevertheless it took decades for the US to reach its current position, so a bit of crystal ball gazing may be valuable.

Incidentally, the IPKat recently posted on whether Patent Trolls are universal, and observed that they seem to be largely a US phenomenon. This Leo has a similar experience – virtually every time I ask a Kenyan audience whether they have heard of Trolls or NPEs, not more than one or two hands are raised. Let us hope it stays that way!

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