The dispute started when an examiner at the Japan Patent Office (“JPO”) rejected a patent application that named “DABUS, an AI that autonomously generated the invention”, as the inventor, after the applicant was instructed to name a natural person (i.e., a human) as the inventor, but did not make the necessary amendments. In the administrative appeal decision dated October 12, 2022, the JPO found that the rejection was lawful and reasonable, and dismissed the applicant’s appeal. The applicant (plaintiff) challenged the JPO’s rejection before the Court, but the challenge was dismissed by the Court on the grounds that it is reasonable to assume that “inventors” under the Patent Act are limited to natural persons and that the JPO's rejection was lawful.

The plaintiff argued that there is no provision in the Patent Act limiting who can obtain patent rights, and the mere fact that AI-generated inventions were not envisaged when the Patent Act was enacted is not a reason to deny protection for AI-generated inventions. Further, the plaintiff, referencing to Article 27(I) of the Agreement on Trade-Related Aspects of Intellectual Property Rights (the “TRIPS Agreement”) and Article 52 of the Europe Patent Convention (“EPC”) as global trends, argued that the Patent Act in Japan should be interpreted as not excluding AI-generated inventions from protection. The plaintiff also argued that because, in this day and age, AIs are capable of generating products autonomously (i.e., without any configurations, preferences and instructions provided by natural persons), such inventions should be protected.

However, the Court did not uphold plaintiff’s arguments due to the following reasons.

• The wording of the relevant provision in the Patent Act does not anticipate non-natural persons.
• An AI cannot be the subject of rights related to patents, and further, the Patent Act does not provide a clear legal basis as to who can exercise the rights relating to the inventor.
• At this moment, it is difficult to determine whether the creativity of natural persons and the autonomous creativity of AIs, which may further evolve in the future, should be considered the same. As such, it is not reasonable to use the current patenting standards for AI-generated inventions.
• The TRIPS Agreement does not necessarily obligate its Member States to recognize AIs as “inventors”, and while the opinion of the European Patent Office is helpful in light of international harmonization, it does not have an immediate impact on the interpretation of the Patent Act in Japan.

The Court concluded that, taking into account all the circumstances, the term “inventor” under the Patent Act is interpreted to be limited to natural persons. However, this decision is not final and may be subject to further appeal.

On a separate note, it is worth noting that, recently, the Japanese government has issued guidelines and presented ideas on AIs. For example, in April 2024, “AI Guidelines for Business” was issued by the Ministry of Internal Affairs and Communications (“MIC”) and the Ministry of Economy, Trade and Industry (“METI”). In February 2024, the Agency for Cultural Affairs (“ACA”) has presented possible ways of thinking about AIs and copyrights under the current Japanese law in its report titled “An Approach to AIs and Copyright”. A risk-based approach is generally adopted in dealing with risk and uncertainty, and these guidelines and ideas are intended to propose desirable measures and/or possible logic applicable to practice, and do not prescribe any obligation to take certain measures pertaining to AI technologies specifically in Japan.

In areas where progress is rapid, the demand for legal solutions increases rapidly, and thus, we must continue to keep an eye on the legal trends related to AIs.