The IP High Court held that an invention entitled "method for settling Electronically Recorded Monetary Claims and a claim management server” does not meet the requirement of an invention (Article 2 (1) of the Patent Act) on the ground that its essence is exclusively directed to an arbitrary arrangement and does not utilize the laws of nature on nature's phenomena or order and therefore the invention is not a “creation of technical ideas utilizing the laws of nature” (IP High Court No. 2019 (gyo-ke) 10110, judgement issued on June 18, 2020).
1.Background
(1) Case Summary
A patent application entitled "method for settling Electronically Recorded Monetary Claims and a claim management server” (applicant; MUFG Bank, LTD. (the “Plaintiff”), application number; 2018-193836) was rejected, and the Plaintiff filed an appeal before the JPO trial board, however, the JPO trial board decided to reject the application. Therefore, the Plaintiff filed a litigation seeking rescission of the trial decision.
(2) Invention
Claim 1 of the application is as follows:
[Claim 1]
Method for settling Electronically Recorded Monetary Claims comprising;
sending a first transfer signal to transfer an amount in accordance with the amount of the Electronically Recorded Monetary Claims to a creditor's account;
sending a first debit signal to debit an amount corresponding to a discount fee of the Electronically Recorded Monetary Claims from the account of a debtor of Electronically Recorded Monetary Claims; and
sending a second debit signal to debit the amount of the Electronically Recorded Monetary Claims from the debtor's account.
In general, “Electronically Recorded Monetary Claims” mean monetary claims that are electronically recorded in the Registry of the Electronic Monetary Claim Recording Institution through banks or other financial institutions in order to accrue, transfer. etc., claims in contrast to traditional promissory notes.
Electronically Recorded Monetary Claims can be discounted and assigned in the same way as promissory notes, and a financial institution that receives an application for discount and assignment will purchase the Claim after deducting a discount fee equivalent to the interest which would occur by the maturity date.
If a discount and assignment is made in this manner, the creditor bears the discount fee, but the guidelines of the Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors (the “Subcontractors Act”) clearly states that the debtor should bear the burden of the discount fee.
According to the invention of claim 1, the claim management server of the financial institution transfers the "amount in accordance with the amount of the Electronically Recorded Monetary Claims" to the creditor's account and debits the amount corresponding to the discount fee and the Electronically Recorded Monetary Claims from the account of the debtor. Therefore, the debtor bears the the discount fee as the guideline states.
(3) Summary of the trial decision and the argument the Plaintiff made
In the trial, the plaintiff argued as follows;
Each process (e.g., transferring the amount in accordance with the amount of the Electronically Recorded Monetary Claims to the creditor's account, debiting an amount corresponding to a discount fee of the Electronically Recorded Monetary Claims from the account of the debtor, etc.) is accomplished entirely by sending and receiving signals. The transmission and reception of signals are accomplished by the transfer of electrical signals between multiple devices through the flow of electrons or electromagnetic waves.
Therefore, the invention is a creation of technical ideas utilizing the laws of nature.
However, the trial board refused the application, stating as follows.
The invention as a whole only specifies business procedures in financial transactions which are business rules based on arbitrary arrangement and it is not a creation of technical ideas utilizing the laws of nature (Article 2 (1) of the Patent Act), even though it includes inevitable technical matters to use computers such as the first transfer signal, the first debit signal and the second debit signal.
In addition, the invention does not specify any technical features other than the inevitable technical matters. Further, a person ordinarily skilled in the art would have been easily able to make the invention based on the prior art and therefore a patent should not be granted for the invention.
The Plaintiff appealed to the IP High Court.
2. Court Judgement
The IP High Court held that the invention does not meet the requirement of an invention (Article 2 (1) of the Patent Act) as follows and dismissed the Plaintiff’s claim.
“Invention” of the Patent Act means “a highly advanced creation of technical ideas utilizing the laws of nature” and therefore those which do not utilize the laws of nature such as mental activities of humans, purely academic laws and arbitrary arrangements are not considered as an invention.
Considering the fact that an invention is accomplished through the stages of establishing a certain technical problem, adopting technical means for solving the problem, and confirming the effects of achieving the desired object by the technical means, whether the "invention for which a patent is sought" in the claims is considered as an invention or not should be judged based on whether the invention as a whole is considered as a creation of technical ideas utilizing the laws of nature or not in light of the problem to be solved by the “invention for which a patent is sought”, the configuration of the technical means for solving the problem and the technical significance such as effects and the like to be led from that configuration.
Therefore, even if some technical means are presented in the "invention for which a patent is sought", the invention is not an invention if the essence of the invention is directed to mere mental activities, purely academic laws and arbitrary arrangements as a result of comprehensive consideration.
The present invention adopts the structure in order to conform to the operational standards of the Subcontractors Act as amended to protect creditors more generously by requiring the debtors to bear the burden of the discount fees which occurs at the timing of settling transactions with Electronically Recorded Monetary Claims and in order to solve a problem of providing a method of settling Electronically Recorded Monetary Claims that makes the debtors bear the discount fee without increasing administrative burden and cost of the debtors and creditors.
It can be understood that the present invention is comprised of “transferring an amount to the creditor's account in accordance with the amount of the Electronically Recorded Monetary Claims” and “debiting an amount corresponding to a discount fee of the Electronically Recorded Monetary Claims from the account of a debtor of Electronically Recorded Monetary Claims” as a technical means of solving the aforementioned problem.
With respect to the effects of the invention described in the specification of the present application, it can be understood that the effect that the present invention will make it possible to effectively suppress the occurrence of claims which are difficult to discount is the effect of having debtors bear the discount fees in light of paragraph [0051] and [0081] relating to embodiments 1 and 2 (“In addition, if the debtor bears the discount fee for discounting Electronically Recorded Monetary Claims, the creditor can recoup the discount fees which the creditor bear temporarily at the time of the discount from the debtors. Furthermore, the present invention can provide incentives for the debtor to construct measures in order to reduce the burden of the discount fee, and therefore the present invention can effectively suppress the occurrence of late payments and claims which are difficult to discount.”,).
Considering the above, the present invention has the effect of conforming to the amendment of the Subcontractors Act which requires the debtor to bear the burden of the discount fees and the effect of suppressing the occurrence of claims which are difficult to discount by adopting transferring an amount in accordance with the amount of the Electronically Recorded Monetary Claims to a creditor's account and debiting an amount corresponding to a discount fee of the Electronically Recorded Monetary Claims from the account of a debtor as technical means to solve the problem. Therefore, the technical significance of the present invention is that it made the debtor bear the discount fees of Electronically Recorded Monetary Claims.
Considering the technical problem, configuration of technical means for solving the problem and the technical significance such as effect led from that configuration, the technical significance of the present invention is that the invention made the debtor bear the burden of the discount fee relating to Electronically Recorded Monetary Claims and the essence of the invention is directed to exclusively arbitrary arrangement for transaction settlement.
The essence of the present invention is directed to exclusively arbitrary arrangement and the invention does not utilize the laws of nature on nature’s phenomenon or order and therefore the invention as a whole is not a creation of technical ideas utilizing the laws of nature.
In light of the above, the invention does not meet the requirement of an invention (Article 2 (1) of the Patent Act).
3.Comments
The IP High Court held that whether an "invention for which a patent is sought" in the claims is considered as an invention or not should be judged based on whether the invention as a whole is considered as creation of technical ideas utilizing the laws of nature or not in light of the predetermined technical problem of “invention for which a patent is sought”, the configuration of the technical means for solving the problem and the technical significance such as effects and the like to be led from that configuration.
Further, the IP High Court by finding the problem to be solved by the present invention, the configuration of the technical means for solving the problem and the effects of the present invention, held that the technical significance of the present invention is that the invention made the debtor bear the burden of the discount fee of Electronically Recorded Monetary Claims and the essence of the present invention is directed to exclusively arbitrary arrangement and the invention does not utilize the laws of nature on nature’s phenomenon or order and therefore the invention as a whole is not a creation of technical ideas utilizing the laws of nature.
The method adopted by this judgement to determine whether the invention is a creation of a technical idea utilizing the laws of nature or not by considering (a) the problem to be solved by the present invention, (b) the configuration of the technical means for solving the problem and (c) the technical significance such as effects and the like to be led from that configuration has been seen in some court case such as the IP High Court Case No. 2014 (gyo-ke) 10101, judgement issued on January 22, 2015 and the IP High Court Case No. 2015 (gyo-ke) 10130 , judgement issued on February 24, 2016.
Written by Mr. Kazunari Horiuchi (Attorney at Law and Patent Attorney)