In this case the Examining Division (ED) had refused the application for lack of inventive step only in view of common knowledge and without any reference to prior art documents.
The Board set aside the decision and remitted the case, expressing its dissatisfaction with the way in which the ED had proceeded:
 A 113 (1) EPC 1973 provides that decisions of the EPO may only be based on grounds or evidence on which the parties concerned have had an opportunity to present their comments. R 68 (2) EPC 1973 further provides that decisions of the EPO which are open to appeal must be reasoned.
[1.1] According to established jurisprudence of the boards of appeal (see e.g. T 763/04 [4.3]), A 113 (1) EPC 1973 is contravened where facts and arguments, which from the appellant’s submissions are clearly central to his case and which may speak against the decision taken, are completely disregarded in the decision in question.
[1.2] Further, established jurisprudence of the boards of appeal explains R 68 (2) EPC 1973 as requiring that a decision must contain, in logical sequence, those arguments which justify the tenor. The grounds upon which a decision is based and all decisive considerations in respect of the factual and legal aspects of the case must be discussed in detail in the decision (see e.g. T 278/00 ) so as to enable the parties and, in case of an appeal, the board of appeal to examine whether the decision was justified or not.
[1.3] In the board’s judgment the decision under appeal violates both fundamental requirements for the following reasons.
 Claim 1 defines a method “for determining how many wells to drill in a plurality of oil and gas field assets” which is defined by a number of algorithmic, mostly mathematical steps operating on variables re la ting to these assets, in particular on decision variables which represent the desired number of how many wells to drill (see step a). Moreover, as part of the method, algorithms making asset-specific predictions are executed, too (see steps a and c3).
[2.1] That a major part of the claimed method is a mathematical one was uncontroversial between the ED and the applicant. It was however controversial whether the mathematical steps according to claim 1 must or need not be taken into account when assessing inventive step.
[2.2] The applicant filed the claims subject to the appealed decision in response to the ED’s objection […] that the claims essentially constituted the implementation of a mathematical method as such on a computer. In the accompanying letter, the applicant argued that and why it considered that the method according to the amended claims was not a mathematical method as such, had technical character and provided the technical solution to a technical problem […].
In its response to the summons to oral proceedings (OPs), the applicant further detailed its position that the claimed invention “employ[ed] technical means” and was “limited to a particular technical application” […]. It further invoked T 1227/05 to justify its opinion that the claimed method cannot be denied a technical effect even though it does not incorporate the physical end product (in this case, the actual drilling of wells) since it “serve[s] a technical purpose” and is also “functionally limited to that technical purpose” […]. A similar argument was based on T 49/99 […]. Therefore, so the applicant’s argument, all method steps, the mathematical ones included, had to be taken into account when assessing inventive step […].
[2.3] Apparently, this issue was the main contentious point when the ED took its decision.
[2.4] In its decision, the ED provides a rather terse summary of claim 1 […] and then states that “all ... features defining the algorithm” except those relating to a “computer processing data” neither have technical character nor “confer technical considerations” on the claim […].
[2.5] The ED does not, however, provide reasons for this allegation. In particular, no reasons are provided as to why neither the claimed fact that “the assets are wells to drill” […] nor the purpose of the claim 1 according to its preamble, namely to “determin[e] how many wells to drill” confer technical character on the claimed method.
 Points 13-15 of the decision cite T 258/03, T 641/00 and T 1173/97 as established jurisprudence and suggest that the ED means to follow the principles laid out in these decisions. This could not have surprised the applicant given that the applicant itself referred to pertinent jurisprudence of the boards of appeal and to a Practice and Procedure Notice of the EPO (PPN 04/08; […]).
[3.1] However, the mere reference to jurisprudence of the boards of appeal does not, by itself, constitute or replace an argument in a first instance decision. If a deciding body, in a decision, wants to rely on an argument put forward in a decision of the boards, be it part of its ratio decidendi or an obiter dictum, it is insufficient merely to refer to it or to recite it. The deciding body must also make clear, by explicit statement or by unambiguous implication, that it adopts the argument and explain why, in what respect and to what extent this argument applies to the case at hand.
[3.2] The decision under appeal however does not explain how the cited decisions apply to the case at hand. Specifically, it does not explain why the ED considers, as it appears to, that the fact that “assets are wells to drill” and the aim to “calculate the number of wells to drill” do not contribute to the technical character of the claim and thus cannot, according to T 641/00 [catchword 1], contribute to inventive step. The decision also does not formulate the technical problem in accordance with T 641/00 [catchword 2] which, if any, the claimed invention is considered to solve, nor argues why it does not consider that the preamble of claim 1 (“how many wells to drill in a plurality of oil and gas field assets”) constitutes this technical problem as the applicant proposed […].
 With reference to T 1227/05 the ED only argues […] that “the specific purpose of the procedural steps of claim 1 is not reflected in the aim of the claim, namely to calculate the number of wells to drill”. This sentence is the only one in the decision under appeal which responds directly to the applicant’s argument based on T 1227/05.
[4.1] In the board’s view, the precise meaning of this statement is unclear as it stands, but it suggests at least that the “steps of claim 1” are, in the opinion of the ED, somehow detached from the “purpose of the claim”. This allegation however appears at least not to be completely accurate, for instance insofar as step a specifies the method to operate on “decision variables represent[ing] the possible outcomes for the number of wells to be drilled”.
[4.2] Even assuming, arguendo, that the “purpose of the ... steps of claim 1” is indeed not “reflected in the aim of the claim”, it remains unclear from the decision why this is an objectionable deficiency and, in particular, what bearing this deficiency has on the overall finding of lack of inventive step. As it stands, the statement in point 16 might also be read as a clarity objection.
 In point 17 of the decision under appeal, the ED argues that “point 7 of T 1029/06 (Toshiba) very well reflects the line of reasoning for the current application”, and cites it: “the majority of the steps are typical tools of operational research that normally have not been considered technical in the established jurisprudence, in particular if only information is processed for the purpose of management decisions”.
[5.1] The board’s view, point 17 is ambiguous as to whether the examining (sic) meant the reference to T 1029/06 to be a constitutive part of its “line of reasoning” or a mere illustration of it. In the former case, it would appear arguable that, in conflict with A 113 (1) EPC 1973, the applicant had hardly any opportunity to present its comments on this part of the grounds for the refusal, since that the ED had introduced T 1029/06 during a telephone conversation a mere two weeks before the OPs and, according to the minutes of this conversation, explained its pertinence with the same terse words as used in point 17 of the decision.
[5.2] Moreover, the appealed decision does not explain in what sense the cited passage of T 1029/06 has any bearing on the inventive step of claim 1 (see point [3.1] above).
First, it would seem from the applicant’s arguments that it would probably oppose the view that the steps of claim 1 are “typical tools of operational research” or are meant to process information only “for the purpose of management decisions”, and this position would appear to be at least prima facie plausible and therefore cannot be silently dismissed by the ED.
Second, the cited passage of T 1029/06 refers only to “the majority of steps” which leaves open the possibility that the remaining steps may be technical and sufficient to establish an inventive step.
 The board further notes that the applicant had argued in favour of inventive step that the claimed invention would “provide a massive amount of parallelism for the overall calculation” “by dispatching the execution of the set of algorithms from the first computer to one or more second computers” […], but that neither the summons to OPs nor the decision under appeal addressed this argument.
 In the board’s judgment, the reasons given in the decision under appeal do not conform with R 68 (2) EPC 1973 because they are insufficient for the applicant to understand why the ED considered the claimed method to lack an inventive step. Moreover, the reasons do not conform with A 113 (1) because they are insufficient for the applicant to understand why the ED dismissed the applicant’s argument provided in the submissions dated 11 November 2011 and 29 December 2009.
 The violation of a party’s right to be heard and insufficiency of reasoning are both substantial procedural violations which require the decision under appeal to be set aside and the case to be remitted to the first instance without the board assessing the substantive merits of the case, see Article 11 RPBA.
The appeal is thus to be allowed and the Board considers it equitable by reason of the substantial procedural violations to reimburse the appeal fee (R 67 EPC 1973).
Should you wish to download the whole decision, just click here; parallel case T 1205/12 is found here.
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