The English High Court today handed down a decision which promises to shape the patentability of key aspects of AI technology.

Overruling an earlier decision of the UK Patent Office (UKIPO), the High Court ruled that Emotional Perception AI Limited (EPAI), a subsidiary of AI Venture Studio Time Machine Capital Squared (TMC2), could patent a novel technique in artificial neural networks (ANNs) which permits the trained ANN to align its output closer towards how a human semantically perceives content. EPAI originally filed its patent application in 2019.

What are Artificial Neural Networks and Semantic AI?

At a high level, IBM explains that ANNs are a subset of machine learning and are at the heart of deep learning algorithms. Their name and structure are inspired by the human brain, mimicking the way that biological neurons signal to one another. Neural networks rely on training data to learn and improve their accuracy over time. Tasks in speech recognition or image recognition can take just minutes when compared to the manual identification by human experts. One of the most well-known neural networks is Google’s search algorithm.

Semantic AI works by combining machine learning and natural language processing, enabling software to understand speech or text to an almost-human level. Context and user intent are key factors semantic AI analyses along with the meaning of the words and its source.

What does today’s judgment mean for financial services in the UK?

While EPAI has previously succeeded in securing complementary patent rights for this technology in the US, the UKIPO has been slow to move away from what EPAI describes as “entrenched ideas” on patentability of computer implemented inventions (CIIs). Companies specialising in computing innovations have faced challenges when trying to obtain patent protection for software and/or business method inventions at the UKIPO, as these types of inventions are generally considered to be “excluded” from patentability as inherently “non-technical”.

Today’s decision could turn the tide in the UK, opening the door for companies developing new emotional perception technologies to address economic and financial crime detection and sentiment analysis, across markets and financial services.

What do industry players think of the High Court decision?

In a press release on the announcement, Professor Andy Pardoe, an advisor to TMC2 and IBM Watson Top 30 AI Influencer, stated: “This change to the UK law, specifically for AI based patents, is a major breakthrough for the UK AI industry and will dramatically help the UK with its ambitions to be a global leader in this field. Differentiating between the technical complexities of the training of an ANN to that of just running an ANN in inference shows deep understanding of the technical separation of these two elements of AI development and implementation. Changing the law to better allow AI based patents to be approved is a fantastic step forward.”

Bruce Dearling, EPAI Ltd’s patent attorney said: “Closing the semantic gap is the Holy Grail in AI technology. This ruling opens the door for UK AI to now accelerate and puts the UK on a better global footing to reward technical innovation. The impact of this decision and any related patent cannot be understated, not least because it provides clarity about how AI and CII inventions must be assessed. It further acknowledges the conceptual brilliance of the inventors, placing them clearly in the vanguard.”

Dr Joe Lyske, co-founder of TMC2 and co-author of the patent added: “We are really pleased with this ruling. What we have achieved here is not just acquiring another patent for TMC2, it’s a game-changer for the whole AI industry. It also shows yet again, that the UK is a world leader in AI and we are proud to be recognised as such with this ruling.”