U.S. Patent and Trademark Office Releases Memorandum on Recent Subject Matter Eligibility Decisions

On April 2, 2018, the U.S. Patent and Trademark Office released a memorandum to the Patent Examining Corps regarding recent subject matter eligibility decisions issued by the Federal Circuit. The memorandum discusses two recent decisions that found claims that improve computer technology are directed to patent-eligible subject matter rather than to an ineligible abstract idea. The memorandum and decisions are instructive for practitioners who draft patent applications, confront subject matter eligibility challenges or respond to USPTO rejections under 35 U.S.C. § 101.

In Finjan, Inc. v. Blue Coat Systems, Inc., 879 F.3d 1299 (Fed. Cir. 2018), the Court (Dyk, Linn, Hughes) found no error in the district court’s subject matter eligibility determination and unanimously held that the claims were patent-eligible under § 101 because they improved computer technology by protecting users against previously unknown viruses and enabled more flexible virus filtering. The invention recited specific steps to accomplish the desired result, and was a non-abstract improvement over traditional computer functionality and virus scanning techniques which only recognized the presence of previously-identified viruses.

Relying on recent Federal Circuit precedent, the Court stated that in cases involving software inventions, the inquiry into whether the claims are directed to an abstract idea often turns on whether the claims focus on a specific asserted improvement in computer capabilities. The claims at issue in Finjan are directed to a method of providing computer security by scanning a downloadable program for suspicious code such as viruses, and attaching the results of the scan to the downloadable program in the form of a security profile. The Court adopted a district court claim construction in finding that the behavior-based virus scan approach improved computer functionality because it determines whether the program performs hostile or potentially hostile operations.

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Covington Artificial Intelligence Update: House of Lords Select Committee publishes report on the future of AI in the UK

Reflecting evidence from 280 witnesses from the government, academia and industry, and nine months of investigation, the UK House of Lords Select Committee on Artificial Intelligence published its report “AI in the UK: ready, willing and able?” on April 16, 2018 (the Report). The Report considers the future of AI in the UK, from perceived opportunities to risks and challenges. In addition to scoping the legal and regulatory landscape, the Report considers the role of AI in a social and economic context, and proposes a set of ethical guidelines. This blog post sets out those ethical guidelines and summarises some of the key features of the Report. Continue Reading

Covington Internet of Things Update: CPSC to Consider Safety of IoT Products

Recently, the U.S. Consumer Product Safety Commission (“CPSC”) issued a Public Notice announcing that it will be conducting a hearing on May 16, 2018 to receive information from all interested parties about potential safety issues and hazards associated with Internet-connected consumer products.

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Covington Internet of Things Update: The FCC Gets Ready for 5G Spectrum Auctions

As we explained in a prior post, 5G deployment will be a critical component to the ever-evolving Internet of Things (IoT). On April 17, the Federal Communications Commission (FCC) adopted a Public Notice seeking comment on the competitive bidding procedures for auctions involving spectrum in the 28GHz and 24 GHz bands. The auction of 28 GHz spectrum will begin on November 14, with the 24 GHz auction following after that. But what does this mean, and why is it important?

For those new to the world of FCC Auctions, a Comment Public Notice, such as the one just released, seeks input on the application process for the auctions and the procedures to be used while bidding. It is similar in form to a Notice of Proposed Rulemaking, in which the FCC seeks comments on a proposal and asks a variety of questions. After the comment and reply comment deadlines pass (May 9 and May 23, respectively), the FCC will take into consideration the input on the record. Next, the FCC will release a Procedures Public Notice, akin to an Order, that will lay out the rules that will be in force for the auction. The FCC will also announce the application windows to participate in the auction, and interested parties will apply to participate. This will all take place before the start of bidding in November. Continue Reading

Covington Internet of Things Update: FCC Looks to Bolster the Communications Supply Chain

Updated (5/3/2018)

On April 17, the Federal Communications Commission (“FCC”) broke new ground in the agency’s role in national security policy by voting unanimously to approve a Notice of Proposed Rulemaking captioned “Protecting Against National Security Threats to the Communications Supply Chain Through FCC Programs” (the “NPRM”).  The deadline for filing comments is June 1, 2018, and reply comments are due July 2, 2018.

As the title indicates, the NPRM seeks comment on a framework to reduce supply chain risks for telecommunications equipment and services deployed throughout the country. The item acknowledges a specific role for the FCC in this arena: to ban use of Universal Service Fund (“USF”) subsidies in ways that undermine or pose a threat to national security. In short, the FCC proposes to use the power of the purse—in the case of USF, about $9 billion in subsidies per year—to dissuade companies from using equipment sourced from companies or countries that pose a national security concern.

Although the approach is narrow in scope, in practice the NPRM could produce a final rule that would significantly affect the selections of equipment and services by some USF recipients, particularly rural and smaller providers who reportedly are more likely to have purchased equipment from targeted suppliers. Additionally, as explained below, this proposed rule could affect USF recipients that do not use prohibited equipment and service providers, depending on whether some of their subcontractors use them. Continue Reading

The UK Government Seeks Views on the Regulation of Digital Markets for a Post-Brexit Great Britain

The UK Government’s Department for Business, Energy and Industrial Strategy has just released a 75-page Green Paper on Modernising Consumer Markets, setting out the Government’s main priorities for the digital economy in a post-Brexit Britain. The Green Paper reflects on the current state of consumer markets and regulation, and lays down the key challenges and opportunities which will be the focus of the UK’s regulatory and competitive framework going forward. This poses consultation questions to stakeholders on hot topics in digital markets, including questions on: the adequacy of the current competition rules and privacy protections, supporting consumer-friendly innovation, use of and access to big data, whether personalised pricing should be regulated, sufficiently protecting customers without stifling innovation, and alternative dispute resolution solutions.

It also includes various proposals to ensure new technology and data are used to benefit customers, strengthen national enforcement of consumer rights, modernise the approach taken by regulators, and improve consumers’ access to alternative dispute resolution services. In this Covington blog post, we explore some of the key messages and questions posed by the Green Paper.

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Covington Internet of Things Update: China Strengthens IPv6 Deployment

At the end of 2017, China’s Communist Party Central Committee and the State Council jointly circulated an Action Plan for Promoting Scale Deployment of Internet Protocol Version 6(IPv6)(“Plan”), and set detailed targets and steps for the next few years, aiming full transition to IPv6 by 2025.

According to the Plan, China is aiming to establish the world’s largest commercial network deploying IPv6, and formulate a next generation internet technical system and industrial ecosystem with independent intellectual property rights, within five to ten years. The target numbers of active users for the proposed IPv6 are 200 million by the end of 2018 and 500 million by the end of 2020, accounting for more than 20% and 50% of internet users in China, respectively. Finally, China is aiming to have the largest IPv6 network in the world by the end of 2025, in terms of network scale, quantity of users, and network traffic scale.

China is in urgent need of a more developed IPv6 network because IP addresses originating from the existing IPv4 network are nearly exhausted, and will be unable to meet the fast development of internet industry, including mobile internet, IoT, big data, cloud computing, and artificial intelligence. According to publicly available statistics, each Chinese internet user was allocated only 0.45 IPv4 address, which is not only insufficient for actual needs, but also leads to cybersecurity problems. By generating IP addresses consisting of 128 bits (instead of 32 bits under IPv4), the number of IPv6 addresses enormously expanded, allowing for an almost unlimited number of appliances in China being connected to the internet.

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UK House of Lords Inquiry on ‘The Regulation of the Internet’

The UK House of Lords Select Committee on Communications has recently opened a Public Consultation on ‘The Regulation of the Internet’, with submissions being accepted until Friday 11 May. The Call for Evidence can be accessed here.

The nine questions posed are relatively broad in scope, including: whether there is a need to introduce specific regulation for the Internet, the legal liability of online platforms, responsibility for online community standards, measures for online safety, information on the use of personal data, and the transparency of business practices – such as the use of algorithms. The last question posed asks stakeholders for their views on what effect the UK leaving the European Union will have on the regulation of the Internet in the UK.

The aim of this Inquiry is to examine how the regulation of the Internet in the UK should be improved, including options of self-regulation and governance – and whether a new regulatory framework for the Internet is necessary – or general UK law is adequate. It follows on from the UK Government’s October 2017 Internet Safety Strategy green paper, which was underpinned by the principle ‘what is unacceptable off-line should be unacceptable online ‘. It also follows the Government’s Digital Charter introduced in January 2018.

In response to the current Inquiry, stakeholders are encouraged to focus on their areas of expertise and therefore do not have to answer every question. They are also permitted to address any additional relevant issues of their choosing not covered by the set questions, provided that they explain the significance of such issues, widening the potential ambit of this Inquiry. As with the standard House of Lords Inquiry process, stakeholders who submit written evidence may be invited to give oral evidence at Westminster – currently tabled between April and September 2018. Any stakeholder wishing to make a submission on this important debate should submit their written evidence online here by 11 May. The Covington Inside Tech Media blog team will post further updates on related developments of significance, in the UK, and across Europe, Asia and the US.

Covington Internet of Things Update: BEREC Confirms European 5G Strategy Priority and Opens Public Consultation on the European Net Neutrality Rules

BEREC, the Body of European Regulators for Electronic Communications, recently held its 34th public debriefing in Brussels. It confirmed, among other developments, that it has made 5G a strategic European priority for the next 3 years, and has opened a public consultation on the European Net Neutrality Rules – which will run until April 25 2018.

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Covington Artificial Intelligence Update: Industry Leaders Discuss the Future of Artificial Intelligence at Washington Post Transformers Series

Computer code on a screen

In its latest installment of the Transformers series, The Washington Post hosted key industry and thought leaders to discuss the current and future implications of artificial intelligence (“AI”).

A number of themes emerged from the two-hour discussion.

First, all panelists agreed that AI will be a useful tool to amplify and extend human skills, but most also noted that humans are still a necessary part of the equation.

Second, panelists acknowledged the need to combat bias in AI and some explained their current work to continually improve against biases. Many stated their goal was ensuring individuals with diverse experiences and backgrounds are infused at all stages of AI development; others similarly emphasized the need to test and validate not only in laboratory settings, but in the environments and communities in which the AI will be implemented.

Third, the question of whether and how to regulate this field remains open, as some panels favor self-regulation while others favor government-imposed transparency and oversight.

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