"Proponents of AI models suggest that copyrighted content is not incorporated verbatim and the content is transformed into something new. But if the content is indeed new, who owns it?"
Choosing the latest emerging technologies with implications for IP is somewhat subjective. I say somewhat because Artificial Intelligence (AI)—and generative AI in particular for purposes of this article—is the elephant in the room. AI is reshaping the world and the practice of law at large. No lawyer or legal professional can ignore AI, even if they ultimately dismiss it. Most are at least exploring AI and considering where it may fit, if anywhere, in their law practice. And unfortunately, some continue making news for AI disasters such as disclosing confidential information and citing nonexistent case law.
Other emerging technologies also present—or continue presenting—notable implications for IP. As expected, dependencies may exist between some emerging technologies enabled by advances to another.
Generative AI
Generative AI has implications for IP, but U.S. patent law and policy has implications for generative AI.
In July, the United States Patent and Trademark Office (USPTO) released revised guidance for patent examiners and practitioners considering whether AI-based claims are eligible for patenting. Under 35 U.S.C. § 101 and prevailing law, claims generally must not be directed to patent eligibility "exceptions"—abstract ideas, laws of nature, or natural phenomena (including products of nature)—or must recite features amounting to significantly more than an exception or use of a computer. Previous guidance set forth generally the multi-step test for patent eligibility and various examples involving application of computers. The revised USPTO guidance adds to the previous guidance discussion and examples of patent eligibility determinations specifically for AI-based claims.
In the courts, at least one statutory interpretation question related to generative AI has been raised at the Federal Circuit. Specifically, whether generative AI may be a named inventor on a patent application. The answer for now is "no". In other words, generative AI precipitated and provided a legal precedent for whether an "inventor" or "individual" as written in 35 U.S.C. § 100 was intended to include only natural persons.
Despite interesting issues across IP, generative AI's implications arguably have been felt most in the copyright realm. As one California Judge has noted, analyzing AI tools under the fair use doctrine is still relatively new. The fair use doctrine allows certain uses of copyrighted works without owners' permission. The judge recognized the issues are "cutting edge" and "test[] the boundaries of fair use and copyright law." For example, generative AI uses third-party works for training models on which to base outputs. The training itself raises questions regarding whether using third-party works as inputs is a fair use. And the output may infringe copyrights if, e.g., it misappropriates likenesses or existing works. Copyright infringement claims involving AI-generated images and music are proliferating.
Proponents of AI models suggest that copyrighted content is not incorporated verbatim and the content is transformed into something new. But if the content is indeed new, who owns it? U.S. copyright law requires "human authorship" and AI-generated content would apparently not qualify because a human was not the creator. In other words, the content in any event is not the result of human discretion. And the "content" may include not only traditional creative arts but also pervasive commercial works such as marketing campaigns. The issue is receiving attention from both the U.S. Copyright Office and courts.
On the trademark front, whether (and how) generative AI use or output may raise trademark issues—e.g., cause a likelihood of confusion with a trademarked brand—is not so intuitive as, for example, reproduction of a copyrighted work. However, as generative AI becomes more widely used for everything from legal briefing to social media trends, we are learning how it may happen. In one example, social media users using AI tool(s) to produce images of their pets in a style associated with an original content producer inputted the original content producer's name into the AI prompt. In certain cases, resulting images included the original content producer's trademarked logo. In a different example, a trademark owner has alleged that generative AI diluted its mark by attaching the mark to low quality, unappealing, or offensive images. The trademark community must be extra vigilant for potential concerns because of the sheer volume of work that generative AI enables.
Trademark owners nonetheless have opportunities for using generative AI to their advantage. For example, generative AI may be used for developing intelligent marketing materials and placements based on the most effective aspects determined through inputs. And what if trademark owners offered licenses to generative AI platforms for deliberately attaching marks to controlled outputs from the AI tool, thus taking advantage of the sheer volume as well?
Interestingly, trademark owners' use of generative AI towards these advantages may fall within the issues discussed above, such as whether the AI-based content strengthens the mark under the relevant law and who owns the AI-generated content even if it includes a license to the mark.
Quantum Computing
Quantum computing technology uses quantum-mechanical phenomena such as electron states for storing and processing information in quantum bits ("qubits", pronounced cue-bits). Quantum computers would be a transformative tool in solving complex mathematical problems in boundless contexts.
Accordingly, quantum computing continues to attract much public and private attention and funding. But viable quantum computing will require a host of harmonized developments.
Beyond the extensive hardware and operational tech, the algorithms devised for taking advantage of quantum computing's versatility may also be protectable IP. For example, the algorithm may represent a patentable advancement in the art. The written code may be protectable under copyright law. In other cases, developers may simply keep their algorithms as trade secrets. And the software and techniques may be unique or proprietary, making trademarks vital in staking claims to the advancements.
Quantum computing is also unique in its applicability to national security in the age of cyber threats. Quantum cryptography and other quantum data encryption or protection tools will enable previously unimaginable data and system security. Efficient deployment among critical infrastructure systems—telecommunications, healthcare, power supplies, banking transactions, etc.—will be a substantial priority. However, IP ownership issues across all of a quantum tool's features may need resolution before protected aspects may be used at all.
Medtech
Medical technology ("medtech") has long been a hot spot for patent protection and the business of health care is precipitating its own evolving technology ("health-tech"), much of which is intertwined with medtech. That's why I'm lumping both under the moniker medtech. And medtech at large—including hospital and health administration—is raising IP questions borne not just from technological innovation but the interplay with regulatory issues, court determinations, and contemporary interfaces with consumers of health care.
An example within the realm of medical devices—i.e., "traditional" medtech—involves emerging drug delivery technology for, e.g., controlling the rate, location, or time at which drugs are delivered in-vivo. Many emerging drug delivery technologies are not necessarily "devices" in the traditional sense of a mechanical product such as an inhaler or pre-loaded syringe. Instead, emerging techniques incorporate in-vivo delivery vehicles such as biodegradable nanostructures and microneedles. But recent attention on the propriety of listing drug delivery devices in the Food and Drug Administration's (FDA) Orange Book may impact these new delivery techniques and patent strategies. Patents listed in the Orange Book give the patent owner a right to an automatic 30-month stay against generic competition without obtaining a preliminary injunction (or satisfying the requirements for one).
Under applicable legislation, the Orange Book is reserved for patents that claim the drug for which the applicant submitted the application and is a drug substance (active ingredient) patent or a drug product (formulation or composition) patent or claims a method of using such drug for which approval is sought or has been granted in the application. In other words, patents covering drug delivery devices themselves are technically not eligible for listing in the Orange Book and the FDA or a court may direct a patent owner to delist any patent determined to not meet the requirements for listing. The Federal Circuit recently heard oral arguments regarding whether device patents that don't explicitly claim active drug ingredients may be listed in the Orange Book. Emerging drug delivery technology raises additional questions such as whether the delivery vehicle is a drug formulation or method of using the drug.
Under the "business of health" portion of the umbrella, emerging technologies are seeking efficiency and transparency for patients and hospital/health operations. Data sets built from a patient's individual information are shared and used for everything from hospital administration such as bed assignments to preparing bespoke reports on third-party software and/or platforms. Thus, the data sets must have compatibility across applications, including storage, use, and display requirements. Questions of ownership arise over the data sets but may be subsumed by privacy requirements.
Also, if data sets are viewed and/or analyzed by parties not subject to appropriate confidentiality restrictions, trade secret protection may be compromised. Yet another example of the confidentiality culture surrounding emerging technology.
Bioinformatics and Computational Genomics
Bioinformatics and computational genomics are related emerging technologies with other IP implications. Bioinformatics, as related to genetics and genomics, involves using computer technology to collect, store, analyze and disseminate biological data and information, including DNA and amino acid sequences. Computational genomics is a branch of molecular biology focused on the structure, function, evolution, and mapping of genomes. Each has become increasingly important for biological and genomic research and advances in computing power including AI tools continually expand the volume of information available per unit time. But massive distribution of DNA sequences and genome information presents IP issues down to a personal level.
Intellectual property rights can cover, for example, DNA sequences manipulated in a lab and new biotechnological processes. But the ownership of DNA sequences or genetic innovations can lead to disputes over who has the right to access or commercialize that data. These understandings and advancements may be invisible to the naked eye but they require substantial research and breakthrough techniques, and may be the foundation of further breakthroughs. Genomics and emerging computational techniques have these representative IP implications based simply on the amount of data and calculation involved.
Federally Funded Research
Admittedly, this is a bit of a copout. But in assessing emerging technologies and implications for IP, any emerging technology or advancement supported by federally funded research has unique implications (issues) and considerations (strategies) for IP in view of court decisions (and pending decisions) and proposed rulemaking over the past year, and the attitude and treatment that the post-election regime shows for IP.
Issues from mid- to late 2024 seem to shroud federally funded bio/pharma programs in more uncertainty than other areas. A notable example is a proposed change to the Bayh-Dole Act's criteria under which the government may exercise "march-in rights" to grant compulsory third-party licenses to drug patents in which the claimed subject matter was conceived or reduced to practice using federal funding. The proposed change would add a drug's price to the considerations for determining whether effective practical application exists for the drug. The proposal draws on a view of exorbitant drug prices in the United States.
The Bayh-Dole Act also requires that all grantees provide the government with a royalty-free license to use resultant patented inventions. Accordingly, government funding specified for an inventive solution to a need in a particular field may nonetheless foreclose the IP owner's ability to monetize the invention in other relevant applications. The likely private market for inventions implemented at least in part by the federal government is an important consideration when determining the value of such federal agreements.
Finally, the Supreme Court recently overturned longstanding precedent known as Chevron deference, which held that interpretation of ambiguous statutes was best left to the administrative agency to which the statute is directed. In the post-Chevron world, courts may shape more of the IP implication landscape, including turning some discussed above on their heads.
Happy New Year!
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