Supreme Court Limits Software Patents (Reasonably)

In Ill-Conceived, Even If Competently Administered: Software Patents, Litigation, and Innovation Shawn Miller and I recounted the logic by which software patents had gotten out of control.

The subject matter of a patent is supposed to be a process, a machine, a manufacture, a composition of matter, or a design. Patents are supposed to protect inventions, not ideas. A pharmaceutical patent, for example, protects a specific set of closely related chemical structures, but you cannot patent a particular means of curing cancer as “any means by which cancer is cured” and thereby exclude every other means of curing cancer. In theory, the same rules apply to software, but in practice the courts have allowed software patents to be much broader and much more abstract than in other areas.

…Consider U.S. Patent #5,930,474 (Dunworth, Veenstra, and Nagelkirk 1999). The patent’s primary claim is simply “A system which associates on line information with geographic areas.” The patent gives this example of what they intend to patent: “[I]f a user is interested in finding an out-of-print book, or a good price on his favorite bottle of wine, but does not want to travel outside of the Los Angeles area to acquire these goods, then the user can simply designate the Los Angeles area as a geographic location for which a topical search is to be performed” (ibid.). In any ordinary reading the patentee has a patent on an abstract idea, thus gaining the right to exclude others from using such an idea. In any other area of patent law, this type of patent would not be allowed. It is allowed for software, however, because software patents such as this one go on to detail the means of implementing such a function. Namely,

A…system comprising: a computer network wherein a plurality of computers have access to said computer network; and an organizer executing in said computer network, wherein said organizer is configured to receive search requests from any one of said plurality of computers, said organizer comprising: a database of information organized into a hierarchy of geographical areas wherein entries corresponding to each one of said hierarchy of geographical areas is further organized into topics…. (ibid.)

In other words, the means of the patent is the Internet. By merely adding some entirely nugatory terms such as computer, database, and display—nugatory because any modern method would use these devices—the patentee has turned an unpatentable idea into a patentable, and potentially very profitable, method.

The Supreme Court has today in ALICE v. CLS decisively rejected this process:

…the mere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention. Stating an abstract idea “while adding the words ‘apply it’” is not enough for patent eligibility. Mayo, supra, at ___ (slip op., at 3). Nor is limiting the use of an abstract idea “‘to a particular technological environment.’” Bilski, supra, at 610–611. Stating an abstract idea while adding the words “apply it with a computer” simply combines those two steps, with the same deficient result. Thus, if a patent’s recitation of a computer amounts to a mere instruction to “implemen[t]” an abstract idea “on . . . a computer,” Mayo, supra, at ___ (slip op., at 16), that addition cannot impart patent eligibility.

I see this ruling as a big win for Mark Lemley who focused on the functional claiming issues of software patents and also as a loss in prestige for the Federal Circuit. It’s evident that the Supreme Court thinks, as Dourado and I argued, that the Federal Circuit has become ideologically captured by the patent bar and in a series of cases the SC has imposed its less parochial view and reasserted its dominance over patent law.

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