On June 7, 2023, the U.S. Senate Committee on the Judiciary, Subcommittee on Intellectual Property hosted a hearing titled “Artificial Intelligence and Intellectual Property – Part I: Patents, Innovation, and Competition.” It’s clear the Judiciary Committee is going to play an active role in the debate on how to regulate artificial intelligence (AI), with many more hearings to come, as this hearing came shortly after the Judiciary Subcommittee on Privacy, Technology, and the Law held a hearing on “Oversight of A.I.: Rules for Artificial Intelligence.”
Senator Christopher Coons (D-DE), Chairman of the Subcommittee, chaired this hearing and opened the proceeding by highlighting how AI is used to innovate. He asked whether “innovations facilitated by AI should be patentable and if so, who should be listed as the inventor?” He made clear that “neglecting IP in an effort to regulate AI would have serious unintended consequences for our innovation ecosystem national security, and economic competitiveness”
Senator Thom Tillis (R-NC), Ranking Member of the Subcommittee, followed Senator Coons’ optimistic perspective, noting that “everyone’s talking about all the bad things that could happen with AI” and chose to highlight “the good things that are going to happen.” He remarked that “even if we chose not to participate as a nation, [artificial intelligence] going to happen, so the question is whether or not the United States is going to maintain a leadership position in innovation?”
Testimony was provided by five witnesses, including:
- John Villasenor, Professor of Electrical Engineering and Law at UCLA and Founder and Faculty Co-Director of the UCLA Institute for Technology, Law, and Policy,
- Ryan Abbott, Professor of Law and Health Sciences at the University of Surrey School of Law and an Adjunct Assistant Professor of Medicine at UCLA,
- Rama Elluru, Senior Director for Society and Intellectual Property Special Competitive Studies Project,
- Laura Sheridan, Head of Patent Policy at Google, and
- Corey Salsberg Vice President and Global Head IP Affairs at Novartis.
The main points from the hearing are highlighted below.
Overview
The hearing highlighted how critical AI has become to innovation, accelerating technological and scientific development across the global stage. As just one example, using AI, new antibiotic drugs that had previously taken years to develop, are being created in only days. In light of that speed of development, rules need to be established and the potential negative impacts cannot be ignored. One obvious first step is to understand whether the existing regulations are able or appropriate to govern AI – these discussions centered around inventorship and conception, prior art, and data sets, as well as AI regulation as a whole and the U.S. relationship with China.
While this hearing focused on AI and IP, additional hearings are already planned and we anticipate Congress to remain focused on this topic, particularly as other jurisdictions such as the European Union attempt to move towards their own AI governance policies.
Details on these main points are highlighted below:
Inventorship and Conception
The granting of patent rights to inventors has been a core value of U.S. patent law since the ratification of the United States Constitution. Furthermore, the U.S. courts have held that the patent laws of the United States define an inventor to be a human being. The five witnesses provided diverse views on how AI technology effects this historical standard of inventorship.
Mr. Corey Salsberg of Novartis testified that the doctrine of law known as conception should not be applied too rigidly as to deprive human inventors of patent rights simply because they utilized generative AI in the inventive process. Because this standard is not used by the rest of the world, Mr. Salsberg stated that it was a critical issue to get right so that our nation’s inventors are not disadvantaged and that America’s strategic and economic leadership is not compromised. Professor Ryan Abbott proposed that Congress should act to amend the Patent Act to protect AI generated inventions by prohibiting patentability from being based on how an invention is made. He stated that, “designation of inventors is less important than patentability, but it would be best to keep legal inventorship based on factual inventorship.” According to Professor Abbott, this change to the Patent Act, would inform the public about how the invention was made and also facilitate ownership determinations of resulting patents.
Professor John Villasenor stated that the present patent laws were sufficient to determine inventorship with the understanding that there must be some nexus between an invention and a human being. Professor Villasenor also testified that AI systems should not be considered inventors as it would require a change in the patent system that may have lasting consequences. Laura Sheridan of Google stated that the patent laws were for humans and not AI. As such, Ms. Sheridan encouraged the U.S. Patent and Trademark Office (USPTO) to provide guidance on inventorship. In addition, Ms. Sheridan suggested that the USPTO encourage patent applicants to document inventor contributions and to implement robust training for any patent examiner examining AI related inventions. Such training would result in the USPTO incurring additional costs, and large entities, such as Google, should pay for such costs by paying larger fees.
Hearing the panel’s varying approaches on incorporating AI contributions to inventorship, the Committee appeared to be unified that Congressional action needed to be taken to make sure that any amendments to the present laws pertaining to AI and intellectual property did not hinder investment in technology in the United States. In response to a suggestion that the courts could provide guidance by applying existing laws to new factual scenarios involving artificial intelligence. Senator Tillis made it clear that he thought Congress should make the law clear instead of leaving it to the courts. Practitioners may agree with Tillis’ assessment, especially when they consider the present chaotic state of the law caused by the Supreme Court’s ruling in Alice regarding patent eligibility.
Prior Art in a Patent Context
While the majority of the panel’s testimony regarding U.S. patent law regarded inventorship of AI generated inventions, other patent issues were briefly discussed. For example, the definition of prior art under U.S. patent law was raised. The law generally states that an invention is patentable unless the claimed invention is not novel or is obvious in view of certain public disclosures made prior to the filing of a patent application. Such public disclosures are commonly called “prior art.”
Until the advent of AI, the universe of prior art was pretty well understood. It could entail prior patents, patent publications, public uses, or public sales. Such prior art always involved humans being the sole inventors of the patented technology, and being the sole parties causing the public uses and public sales. With AI, should prior art be redefined? Should prior art not include AI generated subject matter? Senator Coons suggested that AI could generate volumes of prior art that could prevent humans from obtaining patent protection for their inventive ideas and, thus, disincentivize investment in technology.
As mentioned previously, an invention is patentable unless the claimed invention is not novel or is obvious in view of the prior art. The question of obviousness rests on whether a person of ordinary skill in the art of the invention would have deemed the invention obvious in view of the prior art. There has been much case law on determining what the qualifications of such a person were. Does this change with AI? Could it be argued that everything is obvious in the eyes of a person armed with the tools of AI? If so, it will be very difficult to obtain patent protection for inventions, human inspired or AI-generated.
AI Regulatory Body
Senator Richard Blumenthal (D-CT) brought up the idea that some have floated, including Sam Altman, CEO of Open AI, that there should be a pause in use of AI tools while we figure out an appropriate policy regime. Senator Blumenthal called it a bad idea that would be impossible to enforce, as he also called for a regulatory framework including a new agency. Senator Blumenthal said he didn’t want to alter our current patent enforcement regime, but queried whether a new agency would be useful to take the lead on AI regulation.
In response, the panelists agreed that regulation was needed and that it was important that the federal government coordinate its regulatory effort. Opinions varied among the panelists about whether a new agency would be necessary or whether the regulation of AI would be more appropriately handled by different agencies working in their respective areas of expertise.
Data Sets
Senator Coons asked a question about creating intellectual property protections for data sets. He cited reports that China is allegedly experimenting with new intellectual property rights in data and asked if the United States should be working on creating similar rights. The aim would be to incentivize innovation around data sets and promote disclosure and transparency for their use.
In response, Rama Elluru argued that we need comprehensive strategies for dealing with large data sets that consider issues like data privacy and intellectual property rights. Ms. Elluru said that the estimated market for data in a few years will be over a $1 trillion. Creating certainty about intellectual property rights will incentivize innovation and investment and give the public more access to data sets which otherwise might be closely-guarded as trade secrets. Senator Coons said that this might be a topic the Subcommittee on Intellectual Property would discuss in its next hearing on AI which would center on copyright issues.
Impact on Startups
Senator Blumenthal was sensitive to the impact of both current regulations and any new regulations on startups, or, as he described them, “the folks who are in this room who are going to be inventing stuff in their parents’ garages.” Senator Coons expressed concerns that the AI regulation would wind up favoring “well-funded and established companies.” Mr. Villasenor noted that AI democratizes innovation and the innovation process. The discussion highlighted a difficult balancing act – regulation tends to stifle innovation and makes it more difficult for startups to compete. At the same time, regulation is necessary to ensure that AI is not used in a nefarious manner. In order to paint a clear picture of this sentiment, it is useful to consider these comments together with the comments at the first hearing on AI, where industry leaders from OpenAI and IBM spoke about the impact of regulation.
China
Concerns about AI and China permeated the hearing. Senator Coons’ opening explained that China recognizes IP policy as an “important tool in national strategies for AI and other emerging technologies.”
Rama Elluru explicitly declared that the U.S. is in a race with China to develop the future of AI and that “this innovation competition will shape the world’s future.” She advocated that the U.S. maintain a technology lead by ensuring American innovation is protected by U.S. law. Though she believed that the U.S. is leading with respect to AI technology, she emphasized that China is leading the language models it can use with large data sets it collects from its citizens.
Senator Marsha Blackburn (R-TN) emphasized that in 2021, China was the global leader in patent filings, with numbers double those in the U.S. Of those, China accounts for nearly 75% of the global AI-related filings. In response, Ms. Elluru said that “quantity does not always equate with quality,” but agreed with her general premise and advocated that IP policy be recognized as a national security priority.
Conclusion
Crowell & Moring LLP will continue to monitor these developments given the high stakes of this issue for our clients. We at Crowell & Morning are uniquely positioned to advise on the potential impact of AI regulation, to help companies plan for the future, and to take part in the current policy debate on Capitol Hill and across the federal government. The AI Working Group is a multi-disciplinary group of lawyers, former regulators, and former senior staff on Capitol Hill. We are monitoring hearings and other policy discussions across the government carefully to provide clients with the insights they need to plan, manage risk, and invest in artificial intelligence – one of the most transformational technologies of our time.
For further information, please contact:
Neda M. Shaheen, Crowell & Moring
nshaheen@crowell.com
