04 March 2010

Utility Model Protection for Computer-related Inventions in Germany

In Germany inventors may chose from protecting their intellectual property by a patent according to the German Patent Act (Patentgesetz, PatG) or by a utility model according to the Utility Model Act (Gebrausmustergesetz, GbmG). For a number of reasons - which are briefly outlined below - the utility model appears to be an ideal IP right for software-related inventions. However, even though both IP rights provide identical rights to exclude others from using the protected subject-matter (§ 11 GbmG), there are some major differences between patents and utility models that have to be considered before deciding for any of the two:

  • Novelty: According to § 3 (1) GbmG, an invention is novel if it has not been disclosed in writing and there has not been a public prior use in Germany before or at the filing/priority date. Prior public use outside Germany is not considered, unlike with patents.
  • Unlike with patents, there is no substantial examination done by GPTO for utility models. Before registering a Utility Model only formal requirements are checked (§ 8 GbmG).
  • Method claims are allowable only in patents, but not in utility models (§ 2 Nr. 3 GbmG), original based on an old legal doctrine according to which the subject-matter of a utility model has to fulfil a “requirement of physical expansion” (Raumformerfordernis).
  • A patent expires after 20 years starting with the application date if properly renewed whereas a utility model expires after 10 years starting with the application date if properly renewed (§ 21 (1) GbmG).
  • There is a grace period for utility models, unlike with patents. A description or use within the six months preceding the priority date of the application will not be considered as prior art if it is based on the own conception of the applicant or his predecessor in title (§ 3 GbmG).
  • A utility model is much cheaper than a patent. 
Since a utility model is (i.) cheaper, (ii.) provides a quicker full protection, ((iii.) has reduces novelty requirements and a six months grace period and (iv.) has a reduced term of protection as compared to a patent, the utility model is far better adaptred to the innovation and product cycles of software industry than a patent. And, a German utility model may represent a basis for internantional PCT filing as well (see here for an FAQ of the GPTO).   

Further to that, the unique splitting off procedure of German utility model law (§ 5 GbmG) may subsequently provide a full IP right if a filed patent application turns out to not fulfill the substantial requirements of patent law. A utility model can be split off from a patent application having the same contents - also to obtain flanking protection during the otherwise unprotected patent pendency period - since upon registration of the split-off utility model the invention enjoys full protection and the priority of the underlying patent application irrespective of the outcome of the patent grant procedure. Splitting off a utility model is allowable within 10 years from the date of filing of the original patent application, whereas the utility model application must be submitted within two months from the rejection or withdrawal of the patent application at the latest.

The substantial requirements as to inventiveness of a registered utility model are examined only in cancellation proceedings before the German Patent and Trademark Office (DPMA). The utility model unit registers the utility model without previously examining if the substantive requirements are met (§ 8 GbmG). In case of a dispute, cancellation proceedings will clarify whether the registered invention is in fact new and involves an inventive step (§ 15 GbmG), in contrast to an “inventive act” as required for patent protection. However, other than this terminological difference might anticipate, established case law clarifies that the inventive step requirement of the utility model act cannot be regarded being a lower level of inventiveness as compared to the inventive act requirement of patent law (Demonstrationsschrank, BGH X ZB 27/05, 26.06.2006). 

Protection of Computer-implemented Inventions: Despite the statutory exclusion of “processes” (§ 2 Nr. 3 GbmG) and “programs for computers as such” (§ 1 (2) Nr. 3, (3) GbmG), the decision “Signalfolge” (X  ZB 9/03, 17.02.2004) of the German Federal Court of Justice (Bundesgerichtshof, BGH) opened as door to utility model protection for computer-impelmented inventions. The underlying application claimed a system, a computer program product and a computer related to variable tariffing of Internet charges.

The Utility Model Section of the GPTO rejected the application because the system claims were considered to relate to a method, whereas and amended claims that related to a signal sequence representing data to be transmitted via the Internet have been rejected by the Federal Patent Court (Bundespatentgericht, BPatG) in a second instance decision, also based on the understanding that the signal sequence is directed to a non-statutory method.

However, in the third instance decision of the BGH, the Patent Court’s sentence was overruled since the BGH took the view that the signal sequence to rather represent a physical entity for which utility model protection is in deed available, based on the understanding that the “requirement of physical expansion” (Raumformerfordernis) of the Utility Model Act in force until 1968 was not applicable any more. The BGH reasoned further that exclusions from patent protection, such as the exclusion of methods from utility model protection, should always be interpreted narrowly. Further, the BGH explained that § 2 Nr. 3 GbmG rather relates to “conventional” methods such as production or operation methods but not to a signal sequence.

That is, the BGH merely decided that a signal sequence cannot be excluded from utility model protection only due to the fact that the signal sequence may represent data to be processed by a computer. The case was thus referred back to the Patent Court to decide whether the invention relates to a computer program as such according to § 1 (3) GbmG, which would the of course render the invention unstatutory subject-matter.

Conclusion: As a general rule of thumb, the BGH confirmed that computer-implemented inventions may - under certain circumstances - be protected by a utility model, since they cannot any more be excluded from protection for the sole reason that they may represent a method. As is known for conventional operation methods that can be protected by instead claiming a "means adapted for conducting the method" enriched with a reasonable level of structural features, a computer-implemented method may also be protected by a "computer (program product) adapted to ...". However, as a consequence of the BGH ruling, a computer-implemented invention may now also be claimed as a signal sequence representing data to be executed by a computer - as long as the executed data does not represent a computer program as such.