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1. CHAPTER 1- Fundamentals of Patent Law
1.1 Objective
The objective of this chapter is to give an understanding of patent law fundamentals. It gives an insight into evolution of patent law, objectives of patent law and patentability requirements.1
1.2 Introduction
A patent grants exclusive rights over an invention for a limited period of time to an inventor in exchange of full disclosure of his invention. The objective of the patent system is to promote the progress of science and technology for public benefit. It achieves this objective by granting exclusive rights to inventors. Through grant of exclusive rights, the patent system provides the incentives to invent, invest, design around and disclose, which encourages creation of inventions and their utilization for public benefit.
1.3 Evolution of the patent system
The concept of patent is not of recent origin but has developed over a period of time. In the year 1323, a German engineer was granted the first known privilege for the construction of a model grain mill, which could cater the storage needs of entire Venice. In the early 14th century, certain special privileges were requested by a section of water millers who had a unique set for the purpose of using it before mining. The grant of those special privileges to those water millers can be taken as marking the birth of the patent system. The first patent law in the sense of a promise of exclusive rights to inventors was enacted in 1474 by the Republic of Venice. Such enactment was supposedly the consequence of a long war between Venice and the Turks where Venice lost most of its trading empire in the eastern Mediterranean and as a result, had to refocus on manufacture than trade. Further, when the trade relations between Venice and East weakened, Venice adopted a number of measures to establish and maintain a preeminence in manufacture including law prohibiting emigration of skilled artisans and the export of certain material, while at the same time encouraging the immigration of skilled workers from other countries, for example by a tax holiday for two years after their arrival in Venice.2 The development of the Venetian system later influenced the development of the British and the French system.
During the reign of Elizabeth, England, which was then industrially less advanced, followed the footsteps of Venice by starting to encourage skilled artisans to migrate and develop new industries and trades in England. The encouragement was given in the guise of awarding patents, which were considered as a permission to practice new technology or trades, to such skilled artisans for having brought their new technology into England. Usually, such permissions were granted by local groups who were controlled by the crown and who held monopolies over particular industries. As England marched towards an industrially advanced territory, patents emerged as an instrument of industrial regulation. Patents came to be largely used as revenue generating means and tools for bestowing personal favors. Further, patents were extended to cover industries and trades already well established.
In 16th century the parliament of England enacted Statute of Monopolies. The Statute of monopolies excluded monopolies per se unless they came within the exception of Section 6. Section 6 of this statute can be regarded as laying the foundation of modern patent law. According to Section 6, the granting power of monopoly to inventions by the Crown was restricted to a period of 14 years. The statute laid down the condition that monopoly can be granted only for “any manners of new manufacture” to the “the true and first inventor”.
1 Author: Som Shekar Ramakrishna - rsshekar@brainleague.com
2 http://www.ladas.com/Patents/USPatentHistory.html, visited on August 28, 2010

2. India had its first patent statute passed in the year 1856. The first patent statute was passed in response to the recommendations made by a committee appointed to revise and update the laws to serve the society‟s changing needs. Thereafter, there were several modifications and re-enactments of patent Act ultimately resulting in the Patent Act of 1970 which came into force on 20th April, 1972. Out of these several changes, the modification of Patent Act in response to the report submitted by Ayyangar committee in 1959 is of significance because the report recommended for granting of only process patents to drug related inventions as opposed to granting of product and process patents. Such recommendation of the Ayyangar committee was due to the domination of Indian drug industry by foreign multinationals that imported drugs into the Indian Market and set the prices of life saving drugs high making them unaffordable to a common man. Based on the recommendation, only process patents were granted to drug, chemical, food and certain other inventions under the 1970 Act.
The Patents Act of 1970 was amended thrice after India became a member of WTO. As a WTO member, India had to adhere to a set of agreements, which included the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS). The agreement provided basic standards to be followed with respect to intellectual property by all member countries. One basic standard is the principle of non-discrimination, which provides that inventions must not be discriminated based on the field of science and technology to which they belong. As India was discriminating drug, chemical and certain other inventions by granting only process patents, it had to amend its patent law. It was given a transition period of ten years from 1995 to do so.
In response, India amended the Patents Act thrice in 1999, 2002 and 2005. During the transition period, India was required to grant exclusive marketing rights over drugs, which was implemented through the 1999 amendment Act. The amendment in 2005 remove the discriminatory treatment by granting both product and process patents to drugs, chemicals, food inventions and certain other inventions. A mail box was made available during the transition period for applicants desiring to acquire product patents over drugs and so on after 2005.
1.4 Patentability Requirements
In order to be patentable, an invention must be worthy of a patent grant. The patent worthiness of an invention is assessed by the government through patentability requirements. The five patentability requirements are:
1) The invention should be directed to Patentable Subject Matter;
2) The invention should have Industrial Application;
3) The invention should be Novel;
4) The invention should involve an Inventive Step; and
5) The invention should be described in detail in a Specification and must be enabled.
To get a patent grant, an invention should satisfy all of the afore-mentioned requirements. Grant of a patent is a cumulative effect of satisfaction of all the requirements. As per Dr. Kalyan‟s patent filter model, the patentability requirements may be visualized as filters in a funnel and inventions correspond to the particles entering the funnel. A patentable invention is one which passes through all the filters. If an invention gets blocked at one of the filters, it means that the invention has not satisfied that requirement and hence is not a patent eligible invention. Figure 1 shows the patent filter model propounded by Dr. Kalyan.
According to Dr. Kalyan, the filters must be analyzed in the proposed order for optimum efficiency and effectiveness. The configuration of each patentability filter differs from country to country based on social and economic conditions. However, each country

3. has latitude to configure its filters only over and above certain basic standards that have
to be followed as a result of their conformance with the International Agreements.3
Fig. 1 – Dr. Kalyan‟s Patent Filter Model
Patentable Subject Matter
Patentable subject matter requirement is the first and basic filter for assessing patentability of an
invention. Through this filter, the government defines the list of subjects that are eligible and ineligible
for a patent grant. The list of eligible subjects are defined in broad terms like any invention in Europe
or product or process in India or process, machine, manufacture or composition of matter in USA.
[Foot Note of sections in all three countries.]
In addition to eligible subjects, the subject matter requirement consists of a list of ineligible subjects
enumerated by the law, which are also called as exclusions or non-patentable inventions. While the
exclusions have been judicially created in USA, they have been laid down under the statute in India
and Europe. USA has only three exclusions, which are abstract ideas, physical phenomena and laws
of nature. [Foot note.] On the other hand, India and Europe have a long list of exclusions. The
exclusions or non-patentable inventions in India are:
1. An invention which is frivolous or which claims anything obviously contrary to well
established natural laws is not patentable in India.4 For example, a perpetual motion
machine alleged to be giving output without any input would not be patentable as it
would be contrary to well established principles of natural law.
2. An invention the primary or intended use or commercial exploitation of which would
be contrary to public order or morality or which causes serious prejudice to human,
animal or plant life or health or to the environment is not patentable in India.5 For
example, a machine for creating violent environment would not be patentable as it
would be prejudicial to public order.
3 Id at page 3
4 Section 3 (a) of the Indian Patent Act as amended in 2005
5 Section 3(b) of the Indian Patent Act as amended in 2005
INVENTIONS
Subject Matter
Usefulness
Novelty
Non-obviousness
Specification
Patents

4. 3. The mere discovery of a scientific principle or the formulation of an abstract theory or discovery of any living thing or non-living substance occurring in nature would not be patentable.6 For example, Einstein‟s theory of relativity is not patentable.
4. The mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant is not patentable.7 For the purposes of the provision, salts, esters, ethers, polymorphs, metabolites, pure forms, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance are considered to be the same substance, unless they differ significantly in properties with regard to efficacy”. [Foot Note.] For example, if a substance X is known to treat muscle fatigue, a chloride form of X, Xcl, will not be patentable as it is a new salt form of a known substance.
The validity of this provision was challenged before the Madras High Court in the Novartis case. [Foot Note – Madras High Court decision.] In the case, an invention relating to beta crystalline form of Imatinib Masylate was rejected patent grant based on the ground that it is a new form of an already known substance, „Imatinib‟. The patent applicant filed a writ petition before the Madras High Court claiming that the provision, which provides that new forms of a known substance are not patentable is invalid as it violates Article 14 of the constitution because it is arbitrary and also stated that the provision is not in compliance with the TRIPs Agreement. After hearing the parties, the Court held that the provision does not violate Article 14 and refused to go into the TRIPs Agreement compliance issue. The Court also pointed out that a new form is patentable under the provision if it showed enhanced efficacy, which may be shown through objective scientific evidence.
5. A substance obtained by a mere admixture resulting only in the aggregation of the properties of the components thereof or a process for producing such substance is not patentable. In the absence of any synergistic combination a mere physical admixture will not be entitled for a patent.8 For example, mixture of sugar with pieces of coconut to make a coconut sweet is not patentable because it is a mere admixture.
6. The mere arrangement or re-arrangement or duplication of known devices each functioning independently of one another in a known way is not patentable.9 For example, a wrist watch with a compass attached to it is not patentable as both devices function independently of each other.
7. A method of agriculture or horticulture is not patentable in India.10For example, a method of growing plants on the roof is not patentable.
8. Any process for the medicinal, surgical, curative, prophylactic, diagnostic, therapeutic or other treatment of human beings or any process for a similar treatment of animals to render them free of disease or to increase their economic value or that of their products is not patentable.11 For example, a method of performing acupuncture for treating muscle pain is not patentable. Furthermore, a method of performing a surgery to remove cancerous tissue is not patentable.
9. Plants and animals in whole or any part thereof including seeds, varieties and species and essentially biological processes for production or propagation of plants and
6 Section 3(c) of the Indian Patent Act as amended in 2005
7 Section 3(d) of the Indian Patent Act as amended in 2005
8 Section 3(e) of the Indian Patent Act as amended in 2005
9 Section 3(f) of the Indian Patent Act as amended in 2005
10 Section 3(h) of the Indian Patent Act as amended in 2005
11 Section 3(i) of the Indian Patent Act as amended in 2005

5. animals are not patentable.12 For example, genetically modified mouse being animal, rose plant being plant, a process of selection and propogation of coffee plant being essentially biological process are not patentable whereas a genetically transformed bacterium being micro organism is patentable.
10. A mathematical or business method or algorithm or a computer programme per se is not patentable.13 For example, a method of procurement, sale, and distribution of furniture is not patentable. Furthermore because it is a business method, a computer program for displaying screen savers is not patentable because it is a computer program per se.
11. A literary, dramatic, musical or artistic work or any other aesthetic creation including cinematographic works and television productions are not patentable.14 For example, Books, theatrical plays and so on are not patentable.
12. A mere scheme or rule or method of performing mental act or method of playing a game is not patentable.15 For example, a method of playing chess is not patentable.
Furthermore, presentation of information in any format is not patentable in India.16 For example, a patent will not be granted over a power point presentation.
13. Topographies of integrated circuits are not patentable subject matter in India. They are protected under a different legislation.
14. An invention which, in effect, is traditional knowledge or which is an aggregation or duplication of known properties of traditionally known component or components is not patentable.17 For example, use of ginger for stomach problems is not patentable.
15. Inventions relating to atomic energy are not patentable18
Just like in India, Europe has a long list of non-patentable inventions. To summarize, patentable subject matter has two prongs, eligible subjects and exclusions. An invention to be patentable must fall withint the list of eligible subjects and outside the list of exclusions or non-patentable inventions.
Industrial Applicability/Utility
The industrial applicability or utility requirement assesses whether an invention is useful to merit patent grant. In India, an invention is considered to have industrial application, if the invention is capable of being made or used in an industry.19 However, if the applicants indicate vague and speculative objectives of the invention, then the invention is considered to lack industrial application. For example, stating that the invention would be very useful for locomotion when human beings live on moon would lack industrial applicability because it cites a speculative or future use for the invention.
The requirement in Europe is similar to that of India. [Foot note –cite article of industrial applicability under EPC.] However, in USA this requirement is referred to as utility. The utility requirement can be satisfied only if the invention has substantial, credible and specific use. [Foot note of section and guidelines.] The standards of this requirement are generally higher in USA when compared to India and Europe.
12 Section 3(j) of the Indian Patent Act as amended in 2005
13 Section 3(k) of the Indian Patent Act as amended in 2005
14 Section 3(l) of the Indian Patent Act as amended in 2005
15 Section 3(m) of the Indian Patent Act as amended in 2005
16 Section 3(n) of the Indian Patent Act as amended in 2005
17 Section 3(p) of the Indian Patent Act as amended in 2005
18 Section 4 of the Indian Patent Act as amended in 2005
19 Section 2(ac) of the Indian Patent Act as amended in 2005

6. Novelty
This requirement verifies if an invention is new in the light of what is already existing (prior art) and therefore, worthy of a patent grant. Novelty of an invention is assessed based on any disclosure (Prior Art) which relates to the invention and which is in the public domain before the filing of patent application for that invention. One may imagine the assessment of novelty by considering a conventional weighing balance in which the invention in question is placed on one of the plate and the Prior Art references will be placed on the other plate. The plate on which the invention in question is placed should weigh more for the invention to pass the novelty filter.
The Indian Patent Act defines „new invention‟ as any invention or technology which is not been anticipated by publication in any document or used in the country or elsewhere in the world before the date of filing of patent application with complete specification.20 The prior art which anticipates an invention and negates novelty of an invention can be categorized as follows:
1) Anticipation by publication;
2) Anticipation through public knowledge and public use;
3) Anticipation by public display; and
4) Anticipation by sale.
Each of the aforementioned prior art category, to negate novelty or anticipate an invention, should disclose every feature of the invention as claimed. Further, to determine novelty of an invention single prior art reference will be considered. The disclosure in that single prior art should negate the novelty or anticipate the invention.21
i. Anticipation by publication
For a publication to become a prior art to an invention, the publication must satisfy the following conditions:
a) The publication must disclose each and every feature of the claimed invention; and
b) i. The publication should be of an Indian patent application, which is published before the filing of complete specification for the invention22; or
ii. The publication should be of an Indian patent application filed before the filing of the complete specification for the invention and published after the filing of the complete specification for the invention23; or
iii. The publication may be any kind of publication any where in the world before the date of patent application relating to the invention.24
In other words, an invention will be novel if there is no patent application with respect to the same invention filed in India before its filing date and if there is no publication with respect to the same invention any where in the world before the filing date of the patent application with respect to the invention. However, there are some exceptions to this rule.
Exceptions to Anticipation by prior publication:
Prior Publication is not considered to negate the novelty or anticipate an invention if the publication falls in either of the following circumstances:
20 Section 2(l) of the Indian Patent Act as amended in 2005
21 Manual of patent practice and procedure , 2008, section 3.3.4
22 Section 13(1)(a) of the Indian Patent Act as amended in 2005
23 Section 13(1)(b) of the Indian Patent Act as amended in 2005
24 Section 13(2) of the Indian Patent Act as amended in 2005

7. 1) The applicant/patentee proves that the matter published was wrongfully obtained by the person who has published from the applicant and patentee; and the applicant/patentee has filed an application for patent as soon as reasonably practical after learning about the publication.25
2) A complete specification was filed by a person and thereafter the invention is published or used by contravening the rights of the true and first inventor or any person deriving rights from him.26
3) The invention is communicated to the Government or to any person authorized by the Government to Investigate the invention or its merits.27
4) If the invention in a paper is read by the true and first inventor before a learned society or published with the inventor‟s consent in the transactions of such a society and IF an application for a patent relating to the invention is filed within twelve months of the date of publication.28
ii. Anticipation by public knowledge and public use
If an invention is in the public domain in the form of public knowledge before the filing of a patent application for the invention, then the novelty of the invention is lost. However, in such a case, the knowledge should be easily accessible to the public. Further, if the invention is in public use before the filing of the patent application for the invention, then such public use will amount to the invention being considered as lacking novelty. The invention is considered to be publicly used only if it is used in India. However, if the use of the invention was under secrecy, then such use will not be considered as public use
iii. Anticipation by public display
Public Display of an invention before the filing date of the patent application will anticipate the invention. However, if an invention is displayed by the inventor at an exhibition notified by the Central Government in the official gazette, such a public display or use of the invention at the exhibition or publication of details of the invention as a consequence of the exhibition will not anticipate the invention provided a patent application is filed within twelve (12) months from the date of such public display
iv. Anticipation by sale
If an invention is on sale or is commercially worked in India by the applicant before the date of the patent application, it will not be considered to be novel. However, if the invention was on reasonable trial, it will not be anticipated provided the application is filed within twelve months of the date of first trial.
The novelty requirement is more or less similar to India in Europe and slightly broader in USA. The US law provides grace periods for publication and sale, which are either narrow or non-existent in India and Europe. Furthermore, the US law follows the first to invent system and provides provisions for interference of a prior inventor to negate novelty of an invention.
Inventive Step/Non-Obviousness
Inventive Step or Non-obviousness is an extension of novelty and analyzes whether an invention is worthy of a patent grant in the light of combined prior art from a point of view of a person skilled in the art. An invention is said to possess an inventive step or non-obviousness
25 Section 29(2)(a) and 29(2)(b) of the Indian Patent Act as amended in 2005
26 Section 29(3) of the Indian Patent Act as amended in 2005
27 Section 20 of the Indian Patent Act as amended in 2005
28 Section 31(d) of the Indian Patent Act as amended in 2005

8. if it is not obvious to a person skilled in the art in the light of prior art. In India, an invention is said to have inventive step if the invention is
1) technically advanced in light of prior art or has economic significance; and
2) was not obvious to a person skilled in the art.
The Patents Act of India does not define the terms “technical advance” and “economic significance.” The person skilled in the art is presumed to be an ordinary practitioner aware of what was common general knowledge in the art at the relevant date.29 If such a person feels that the invention is obvious, the invention would not satisfy the inventive step requirement.
To assess inventive step, all information in prior art references can be combined provided they are all in the same art. Some of the questions that will be considered in determining inventive step are
what was the problem which the patented development addressed?;
how long had that problem existed?;
how significant was the problem seen to be?;
How widely known was the problem and how many were seeking a solution?; and so on.30
The Indian patent office follows a problem-solution approach. The first step is to identify the problem solved by the invention and whether the solution proposed by the invention is obvious in the light of existing solutions. Secondary indications such as commercial success, long felt but unresolved need and other secondary factors will also be considered for assessing inventive step.
In the most important case on inventive step in India, Bishwanath Prasad Radhey Shyam v. M/s Hindustan Metal Industries, the Supreme Court of India stated that in order to be patentable an improvement on something known before or a combination of different matters already known, should be something more than a mere workshop improvement and must independently satisfy the test of invention or inventive step. [Main foot note of the case.] The court further stated that to be patentable the improvement or the combination must produce a new result, or a new article or a better or cheaper article than what was already existing. As per the court, an invention would have an inventive step if the combination of old known integers may be so combined that by their working inter relation they produce a new process or improved result.
The inventive step requirement in Europe is similar to that of India. However, the case law with respect to the requirement in Europe unlike in India has developed to a large extent. The requirement is referred to as Non-obviousness in USA and has been expounded by many court decisions. In both Europe and USA, non-obviousness is assessed based on combination of prior art, person skilled in the art, maturity of the field of invention and predictability of the art. While perception of each of the said criteria may vary from country to country, similar factors are considered in both regions. Despite the large volumes of case law on the requirement, the non-obviousness requirement is considered to be the most ambiguous requirement and is referred by some as meta-physics of meta-physics.
EXAMPLE FOR ASSESSING NOVELTY AND INVENTIVE STEP
A complete specification directed to an invention related to a water bottle cap (as shown in the figure below) is filed with the Indian Patent Office. Claim 1 (independent claim) of the complete specification recites:
29 Manual of patent practice and procedure, 2008, section 3.51.2
30 Manual of patent practice and procedure, 2008, section 3.14.1

9. Claim 1: A water bottle cap, said cap comprising:
a base defining an opening, said base having a locking mechanism configured to engage said base with a bottle;
a water outlet pipe adapted to be received inside the opening, said pipe attached to said base; and
a closure member hingedly engaged to said base, said closure member adapted to move between an open position, where the closure member moves away from said pipe, and a closed position, where the closure member moves towards said pipe and abuts said base.
Prior Art
Prior Art references uncovered by the Patent Examiner for this invention are:
Prior Art 1:
Prior Art 1 discloses a water bottle cap having a base with an opening. Further, a straw adapted to be received inside the opening is disclosed. The straw extends inside the bottle. The straw has a closure member just enough to close an opening defined in the straw. Further, the straw has a sealing mechanism which seals the opening defined by the base.
Prior Art 2:
Prior Art 2 discloses a water bottle cap having a base. The base of the water bottle cap defines an opening. Further, a closure member is hingedly attached to the base. The closure member moves between an open position, where the closure member moves away from the opening of the base, and a closed position, where the closure member moves towards opening of the base. The projection of the closure member, in the closed position, extends inside the opening and thus seals the opening.
Following is the table comparing the claimed elements and the elements disclosed in the prior art.
INVENTION
PRIOR ART 1
PRIOR ART 2

10. Base
√
√
Water outlet
√
×
Closure Member
×
√
√= corresponding element is present; and
×= corresponding element absent.
Novelty Assessment
The invention will be considered novel if all elements of the water bottle cap are not present in a single prior art reference. Therefore, let us consider Prior Art 1 and Prior Art 2 separately.
Prior Art 1 does not anticipate the claimed invention because as seen in the table, the closure member as required by claim 1 of the invention is not disclosed by Prior Art 1. The disclosure of Prior Art 1 is limited to a member that closes the straw and the member abuts the straw as opposed to abutting the base as required by claim 1.
Prior Art 2 does not anticipate the claimed invention because, as seen in the table, the water outlet as required by claim 1 of the invention is not disclosed by Prior Art 2. Prior Art 2 simply fails to disclose the existence of pipe in the cap, which are present in the invention.
As either of the prior art references do not disclose all elements of the invention, it can be considered to be novel.
Inventive Step Assessment
To assess inventive step, all information in prior art references can be combined provided they are all in the same art. An invention will be considered to be non-obvious if a person skilled in the art does not find it obvious based on combined prior art.
Prior art 1 discloses a base and a water outlet, which are present in the invention as well. Prior art 2 discloses the base and the closure member, which are also present in the invention. On combining the prior art references, a person skilled in the art can easily think of making a bottle cap with a base, piple or water outlet and a closure member. It would be obvious for such a person to combine the two prior art references to arrive at the invention. No undue experimentation is required for such a combination. Therefore, the invention may be considered to be obvious. However, if the inventor can prove that such a combination cannot be arrived at by the skilled person based on prior art, then the invention would be non-obvious and therefore, would possess an inventive step.
Specification
In order to obtain a patent, the applicant must file a patent application containing a specification. The specification should start with a title and end with one or more claims defining the scope of the protection sought. The invention that is claimed must be described in the specification in a detailed manner. This is called as written description of the invention. The specification must be framed in such a way that the invention is enabled. Enablement of an invention means that the invention must be capable of being worked by a person skilled in the art based on the written description without any undue experimentation. India and Europe have similar written description and enablement requirements. However, in USA, unlike in Europe and India, written description and enablement are treated as two different requirements, which must be independently satisfied. Written description must show that the inventor is in possession of the invention and enablement must ensure that the invention is workable.

11. 1.5 Summary
The objective of patent law is to promote progress of science and technology through grant of exclusive rights. The exclusive rights provide the necessary incentives to encourage creation of inventions. In order to be patentable, an invention must satisfy five patentability requirements. They are patentable subject matter, industrial applicability, novelty, inventive step and specification. As per Dr. Kalyan‟s patent filter model, these requirements are like filters arranged in succession. Grant of a patent is the cumulative satisfaction of the requirements or passing through all the filters.
1.6 SELF EVALUATION QUESTIONS
1) X files a patent application with complete patent specification in the Indian Patent and Trademark office on 25th August, 2010 relating to an invention. Y published an article, relating to the same invention as that of X, in a journal in the United States of America on 1st June 2010. Will the invention of X be anticipated by Y‟s publication?
2) X and Y are colleagues. X tells Y about his invention. Y leaves the company. X files a patent application with complete patent specification in the Indian Patent and Trademark office on 25th August, 2010 relating to the invention. Y published an article, relating to the same invention as was told by X to Y, in a journal in the United States of America on 1st June 2010. Will the invention of X be anticipated by Y‟s publication?
3) What is patentable subject matter? Explain exclusions in India relating to computer programs.
4) What is novelty and how is it assessed?
5) What is inventive step and how is it assessed?