The UK Supreme Court handed down a rare double bill of key intellectual property law decisions on 11 February 2026. Final decisions in both cases – Emotional Perception AI Ltd v Comptroller-General of Patents and Dairy UK Ltd v Oatly AB – have been eagerly anticipated, and promised to provide clarity on two modern, complex – and yet very different – issues: (1) the patentability of AI-related inventions, and (2) the interaction of UK trade mark law with retained EU law on the marketing of dairy alternatives.
1) Emotional Perception AI Ltd (Appellant) v Comptroller-General of Patents (Respondent)
With what has been one of the most closely watched patent cases in recent years, the Supreme Court was given its first opportunity to examine the patentability of AI related inventions, marking an important moment for innovators and businesses working with machine learning technologies.
Background
In April 2019, Emotional Perception AI (EPAI) filed a UK patent application to protect an Artificial neural network designed to categorise and find semantically similar files. It is, in effect, an AI-driven recommendation system – using artificial neural networks (ANNs) to identify similar media files (e.g. songs).
In 2022, following several rounds of examination and a hearing, the UKIPO refused the application on the basis that it fell within the “program for a computer…as such” exclusion from patentability set out in Section 1(2)(c) of the Patents Act 1977.
In 2023, EPAI was successful in appealing the UK Intellectual Property Office (UKIPO) decision to the High Court, who found that the exclusion did not apply – ANNs did not fit neatly into the concept of a “traditional” computer program for these purposes and, in any event, EPAI’s invention achieved a technical effect that ultimately prevented Section 1(2)(c) from applying. This decision caused real excitement at the time (as well as – in equal measure – concern in certain circles), that the UK would be taking a more permissive approach to the patentability of AI-implemented software.
However, in 2024, the Court of Appeal overturned the High Court’s decision (as we explained in our previous blog) – unanimously upholding the UKIPO’s initial decision to refuse EPAI’s application. Whilst the Court of Appeal acknowledged the differences between how ANNs and “traditional” computer programs work, this did not matter for the purposes of the exclusion and, in any event, EPAI’s invention did not produce the necessary “technical effect” to prevent Section 1(2)(c) from biting.
EPAI was granted leave to appeal the decision to the Supreme Court, with a hearing being held across two days in July 2025, targeted at answering two key questions:
1. Does the statutory restriction on patenting a “program for a computer…as such” apply to ANNs?; and
2. If so, whether the EPAI invention nonetheless makes a sufficient technical contribution to escape the Section 1(2)(c) exclusion.
Supreme Court Judgment
In what is being described as a landmark decision, the Supreme Court has unanimously allowed EPAI’s appeal, holding that the UKIPO and the Court of Appeal had applied the wrong legal approach to the computer‑program exclusion. The Court held that the long‑used Aerotel test should no longer be followed, and that the UK should instead adopt the European Patent Office’s (EPO) “any hardware” approach to identifying an “invention”.
Although the Court agreed that an ANN is, in substance, a “program for a computer”, it also made clear that this does not automatically make the invention unpatentable. As the claimed system necessarily runs on physical hardware, it has the required technical character to qualify as an “invention” and is therefore not excluded “as such”.
The case has therefore been remitted to the UKIPO to reconsider its examination, in light of the Supreme Court’s new guidance and to conduct the newly emphasised “intermediate step” of filtering out non technical claim features before assessing inventive step.
Impact
The decision marks a significant shift in UK patent law – the Aerotel test is no more, and there is instead broad alignment with the EPO on a key (and often-litigated) exclusion from patentability. In doing so, the Court has removed a significant barrier to patentability for AI‑related inventions, as ANNs and other machine‑learning models will no longer be rejected simply because they amount to computer programs “as such”. Instead, they will now be assessed on their technical features and, ultimately, on the usual tests of novelty and inventive step.
This creates a more predictable system for inventors and businesses, and means the UKIPO’s examination practice will need meaningful adjustment – the Court expressly noted that the UKIPO will need to revise its guidance and training and the Court is expected to issue further guidance to the UKIPO on this point shortly.
While EPAI’s specific patent application will now be re-examined by the UKIPO in light of this decision, the wider message is that AI-related inventions are not per se excluded from patent protection in the UK (as some had feared they might be). This will be welcomed as a major victory by AI and tech companies and presents the UK as an attractive forum for investment and innovation in AI-related inventions.
2) Dairy UK Ltd (Respondent) v Oatly AB (Appellant)
This case is now the UK’s leading authority on the extent to which plant based brands can be restricted from using “dairy” terminology (whether directly, indirectly or even playfully), and on the scope of one of UK trade mark law’s lesser used (but remarkably far reaching) provisions, and how it interacts with retained EU law.
Background
In 2019, Oatly AB (Oatly) applied to register the trade mark “POST MILK GENERATION” for its oat-based drinks. The application proceeded to registration in April 2021.
Later that year, Dairy UK Limited (Dairy UK) – the trade association for the UK dairy industry – sought a declaration that the registration was invalid on the basis that “POST MILK GENERATION” was deceptive (which is prohibited under Section 3(3)(b) of the Trade Marks Act 1994), as Oatly was not selling milk and the use of the trade mark could, in any event, be otherwise prohibited by law under Section 3(4) of the 1994 Act. The “law” in question that Dairy UK sought to rely on was Article 78 of Regulation (EU) 1308/2013, a retained EU law which restricts the use of dairy specific “designations” such as milk, butter, cheese and cream to animal derived products only.
In its 2023 decision, the UKIPO rejected the deceptiveness ground, finding that consumers were unlikely to think Oatly’s slogan implied that its products contained dairy. However, it upheld the challenge under Section 3(4), concluding that the use of the term “milk” within the “POST MILK GENERATION” mark was prohibited by Article 78, rendering the trade mark invalid for oat based food and drink goods.
On appeal, the High Court took a different view, finding that Article 78 is principally aimed at controlling “generic” dairy descriptors and that the UKIPO had therefore erred in assuming that any use of the word “milk” in product marketing was problematic per se.
The Court of Appeal overturned this analysis, allowing Dairy UK’s appeal. It held that “POST MILK GENERATION” fell within the concept of a “designation” for the purposes of the 2013 Regulation, such that section 3(4) provided a valid basis for refusing registration.
Oatly were given permission to appeal. The key question for the Supreme Court was, therefore, the proper construction of “designation” for the purposes of Article 78, namely:
- is it limited solely to words or phrases that are solely descriptive of, or are generic terms for, the goods that they designate (as was Oatly’s position, which was endorsed by the High Court); or
- is it, in fact, much broader than this, extending to words or phrases that refer to the product in any way, including as all or part of a trade mark (as was Dairy UK’s position, and the view of both the UKIPO and Court of Appeal).
Supreme Court Judgment
The Supreme Court unanimously dismissed Oatly’s appeal, confirming that “POST MILK GENERATION” is invalid for use in connection with oat‑based food and drink products.
The Court adopted a broad interpretation of “designation”, holding that the slogan does indeed use the term “milk” as a designation within the meaning of Article 78 and Point 5 of the 2013 Regulation. As a result, its use (and registration) may lawfully be prohibited.
The Court also found that Oatly could not rely on the proviso allowing designations that “clearly” describe a characteristic quality of the product – the slogan did not “clearly” do so, even if it indirectly suggests that the products contain no milk.
Impact
This ruling confirms a strict interpretation of the rules that govern the use and registration of “milk” (and, it is assumed, the names of other similar meat and dairy goods). That ruling could have serious implications for the way in which plant-based alternatives can be marketed.
The Court’s reasoning makes clear that even oblique or slogan‑based phrases that simply include dairy terms can count as prohibited “designations” when used for non‑dairy foods (unless they unambiguously describe a genuine characteristic of the product). This will, in turn, make it more challenging for plant-based producers to communicate to consumers what, exactly, their product is intended to replace or imitate – even if (as the courts appeared to have accepted throughout this dispute), the average consumer would not be deceived or otherwise confused.
The decision comes at a time of heighted scrutiny of naming conventions in the plant-based sector. In October 2025, the European Parliament voted to prohibit the use of terms such as “burger”, “sausage”, “steak” and “bacon” when used to denote their vegetarian and vegan alternatives – although the ban is yet to be agreed and signed off by the European Commission.
Concluding Remarks
These two decisions underline the Supreme Court’s pivotal role in shaping the UK’s IP landscape as technology and consumer markets evolve. The Court has opened the door for AI patent protection, while firmly closing it on playful or indirect uses of dairy terminology by plant based brands.
Both rulings will require careful navigation: AI innovators will need to present technical features with precision, and plant based producers will need to approach product naming with renewed caution. Businesses operating in these spaces should evaluate their patent strategies and branding approaches now, ahead of what is likely to be increased scrutiny and, potentially, further legislative refinement.
Please get in touch with any of the contributors to this blog if you have any questions about your IP.
We are also delighted to now offer clients full trade mark services, including assessing and advising on your proposed trade marks, handling the application and registration process on your behalf, and all other trade mark prosecution work. Please get in touch if you would like to discuss further.
Contributors
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Partner
Legal Director
Trade Mark Attorney
