Intellectual Property

When utilising AI-based tools, or collaborating with partners or purchasing AI services from third parties, it is important, both from a risk perspective and to ensure value creation, to understand whether IP will subsist in materials used at each stage of the process, who will own them, and whether any restrictions will be placed on the exploitation of the results of AI.

AI can be used in a broad range of applications, each of which may raise specific IP issues.

This section summarises the IP considerations common to the implementation of AI-based solutions across a broad range of industries.

What elements can be protected?

Intellectual property can subsist in numerous aspects of AI processes, including the following:

Several IP rights may cover each of the above categories of material, and the approach to the subsistence and ownership of IP relating to those categories differs significantly between countries.

IP in the data corpus/dataset

Aside from data protection and privacy considerations, the right to use a given dataset may be affected by third party IP rights and by contractual restrictions.

In the EU, databases may be protected by IP rights separate from the contents of the database. Database rights protect against the extraction and/or reutilisation of the whole, or a substantial part of, a database and the repeated and systematic extraction of insubstantial parts of the contents of a database. Copyright (which protects against unauthorised reproduction of copyrighted materials) may also subsist in a database. As such, both raw collections of unlabelled and labelled data may be protected in the EU.

Outside the EU, the IP protection afforded to databases is typically more limited, and generally reliant on the copyright or confidentiality/trade secrets protection.

In many jurisdictions, the aggregation and collection of information, even if the underlying information is available in the public domain, may be protected as a trade secret.

The process of labelling data and parsing a dataset for use in AI processes will typically increase the likelihood of a database being eligible for protection under the law of confidential information/trade secrets, as long as the dataset is not otherwise available in the public domain in that precise form.

While not IP rights per se, access to datasets and underlying data items may have been granted subject to contractual restrictions which affect the use and ownership of IP in databases and works derived from datasets.

When engaging with third parties in relation to any AI-based solution, specifically defining the ownership position and the rights to use in relation to any inputs and modified datasets at the outset of the relationship will help avoid disputes further down the line.

IP in models

The core of any AI process is typically an algorithm or a collection of algorithms. In many cases, the high-level details of the algorithms are widely known in both industry and academia, leaving little scope for making IP claims to wide-ranging methodologies. However, subtle differences in the implementation of existing models and the tuning of weighted parameters can make dramatic differences to the performance of an AI-based process or service. As such, variations on well-known, established algorithms may themselves give rise to valuable new IP.

Patents

Patent protection is widely available for AI-based inventions and significant volumes of AI patent applications are now made every year. In Europe, the fact that mathematical and business methods and programs for computers are excluded from patentability ‘as such’ has not prevented the European Patent Office (EPO) from granting large numbers of patents for AI inventions - the vast majority of which can only be implemented in software. Many patent offices, including the EPO, have issued guidance and convened conferences regarding their approach to the examination of AI-related patent applications.

Although large numbers of AI-related patents have already been granted, relatively few have been tested in court. Patents for software-implemented inventions and business methods have not fared well in US and European courts in recent years; and the USPTO’s Patent Trial and Appeal Board has now become a very important jurisdiction for challenging software and business method patents. Despite the risks of revocation or invalidation, patents for AI-related inventions, and portfolios of AI patents in particular, may give organisations significant competitive advantages – both from an offensive and defensive perspective.

Copyright

The actual implementation of the algorithms in software code may be protected by copyright. Copyright may protect both the executable form of the program and the source code. The scope of copyright protection in software has been narrowed in recent years, and in most jurisdictions it is now difficult to protect algorithms and methods using copyright; copyright will still protect the specific implementation of an algorithm in code form. However, the implementation of the same algorithm, in new independently-created code, may not constitute an infringement of copyright in the original code.

Confidential information/Trade secrets

Trade secrets may protect the algorithms themselves, or the particular way in which an algorithm is implemented or ‘tuned’. The need to maintain confidentiality may influence the way in which AI software is utilised or deployed to customers or clients.

Weighted parameters

Sets of weighted parameters may also be protected by several forms of IP. Database rights may be available in the same way as for datasets generally; and copyright and confidentiality protection may also provide additional protection.

In a collaboration, it is likely to be relatively easy to identify which party is providing the algorithms and who (as between the collaboration partners) owns the IP; but the ownership of weighted parameters may be less clear unless clarified under the applicable collaboration contract(s).

Ownership of the outputs of AI processes

The laws governing ownership differ between individual IP rights and jurisdictions. In many jurisdictions it is unclear whether works or inventions created or devised by AI can qualify for IP protection under existing laws. The policy considerations regarding amendments to the law to take AI into account are the subject of much academic debate.

UK copyright law provides possibly the clearest example for the protection of copyright works created by AI. Ownership of copyright in the UK is typically determined by reference to the author of the work, and UK law deems the author of a ‘computer-generated’ work to be ‘the person by whom the arrangements necessary for the creation of the work are undertaken’.

There is still scope for dispute as to how such an individual is to be identified. For example, a purchaser of an AI-based software tool who uses the tool for their own purposes may be the most obvious ‘author’; however the provider of AI-based software as a service may have competing claims to works created by users of its service, and may be able to argue that the provider, rather than the user, undertook the ‘necessary arrangements’. By contrast, in most other jurisdictions there are clear requirements for a ‘human author’ who has expended ‘independent intellectual effort’ in the creation of the work, which may exclude copyright protection in works resulting from AI.

In respect of inventions created by AI, it is arguable in many countries that a human inventor is required before an entitlement to patent protection can arise. Indeed, an academic study commissioned by the EPO concluded in 2019 that none of the jurisdictions surveyed allowed for AI systems to be considered as an inventor. For example, under UK patent law any ‘person’ may make an application for a patent, which will primarily be granted to the ‘actual deviser’ of the inventive concept or concepts comprised within an invention.

Unlike the position under UK copyright law, there are no provisions in the UK patent legislation by which inventions devised by computers are deemed to have been devised by any identifiable human inventor. Disputes may arise relating to entitlement to, and/or subsistence or inventorship of, patents for inventions devised by AI. The discussion may focus on whether an AI-based application was being used by a human inventor as a ‘tool’, where the inventive concept was in fact devised by the human, or whether the invention had, in substance, been devised by AI working without human intervention.

The laws relating to entitlement to patents and ‘inventorship’ vary significantly between jurisdictions. In most cases the question of ownership of inventions in which AI played a role is likely to focus on the identification of an identifiable human inventor and the contribution made by that individual.

If copyright or patentable inventions do reside in the outputs of AI-based processes, in the context of a collaboration, there may be disputes as to which of the collaboration partners contributed the necessary elements giving rise to the IP rights. As such, ownership of IP in outputs should also be addressed in any collaboration contracts.

Current at 20 November 2020