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Amici Urge Caution on Software Patents at the Supreme Court


Written by Gene Quinn (left), Founder of IPWatchdog, Inc.
Steve Brachmann (right), Freelance Journalist
Posted: March 13, 2014 @ 12:54 pm

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Former CAFC Chief Judge Paul Michel filed an amicus brief in Alice v. CLS Bank.

In a few weeks, the Supreme Court of the United States will begin to hear arguments in Alice Corp. v. CLS Bank International. This case involves the very basics of U.S. patent law, namely what is considered patent eligible, and will have wide-reaching effects in the American technological sector. The case before the Court will ask it to decide upon the patent eligibility of software based on the most foundational aspects of patent law: Section 101 of U.S. Code Title 35. If a category of innovation is not patent eligible under Section 101 it does not matter whether the invention is highly useful, new and non-obvious. In fact, an invention can even be pioneering and revolutionary and not deserve a patent if it is deemed patent ineligible under Section 101. Because a determination that an entire area of technological pursuit can be deemed patent ineligible under Section 101 historically that has been only infrequently used so as to not unnecessarily kill innovative developments in their infancy.

In recent years, however, the Supreme Court has shown far more willingness to find things patent ineligible, which is a disturbing trend. In fact, In Mayo v. Prometheus, the Supreme Court conflated Section 101 with 102 to say that something that a patent claim that does not related to a law of nature was still nevertheless patent ineligible as a law of nature because the additional steps added that made it different than a law of nature were merely conventional. Up until Mayo such an analysis had been mandated by the Supreme Court to occur under Section 102. Indeed, the statute the Supreme Court ostensibly must follow requires novelty and conventionality to be addressed under 102. Thus, as the result of Mayo, and the Supreme Court’s decision in Myriad, there is great concern about the future of patent eligibility because it seems the Supreme Court now seems to prefer to find inventions patent ineligible without the mandated statutory analysis under 102, 103 and 112.

Software innovations are ubiquitous in our country, in use by machines and systems from consumer devices on to basic utility grids. There are numerous individuals who are keenly interested in the outcome of this case, and many have volunteered to participate and provide their insight, opinions and arguments to the Supreme Court. With this in mind we wanted to share some of the most informative amicus curiae briefs that have been filed with the U.S. Supreme Court. We have already published articles about the IBM amicus brief, the brief filed by the Solicitor General and the Trading Technologies amici brief joined by another 45 companies. Now as a part of our ongoing coverage of this case, we’ll look at what several other interested parties have to say about the patentability of software, and how our country’s patent system should be treating this issue.

 

Brief of Amicus Curiae Paul R. Michel in Support of Neither Party

The United States Court of Appeals for the Federal Circuit is the body involved in ruling on major patent validity litigation in this country, and Paul R. Michel is the only retired living Chief Judge of this court. As the brief states, he would have an ability to provide expert and objective opinion because of his 22 years deciding on matters much like this. In fact, few people are as capable of providing relevant, helpful commentary on any patent issue.

Chief Judge Michel’s brief makes two major recommendations regarding the essential question of software’s patentability. First, Michel states that the criteria for patent eligibility under Section 101 should only exclude those inventions that are clearly patent-ineligible. Some suggest that software is brought into question as possibly patent-ineligible because a computer program relies on mathematical algorithms to perform a process. However, Michel points out that real world applications of natural laws, such as an algorithm, should be patentable if claimed in conjunction with a computer. Although the computer is known prior art, the software serves to specialize the machine, which again would indicate the patentability of software. Furthermore, the tethering to a machine means that the software does not preempt ideas.

Another recommendation regards splitting claims into new, “patentable” material and older material that is sometimes thrown out as irrelevant in patent validity claims. The whole of the claims are the scope of the patent grant, as has been affirmed many times by the Federal Circuit and other courts. Some have advocated for removing old material from the claims, but this is ill-advised. Michel argued:

If a claim can be sliced-and-diced, however, it is likely that each element of the claim is, by itself, old and conventional, and is preemptive of a truly broad range of implementations, as no one works from scratch but God.

Because these patents protect a process implemented on a computer, some features of that process are likely going to rely on prior art, but that alone shouldn’t be enough to render the patent claims ineligible. If the whole of the process is novel, removing prior art material from the claims would create claims that don’t adequately reflect what is being protected. Essentially, removing the conventional re-writes the claim and the re-written claim is then evaluated, which means that patent eligibility would be decided not on the claimed invention but on some judicially re-written version of what was originally articulated as the claimed invention.

In his conclusion, Michel argues that, although all patent applications must first be reviewed under Section 101 for eligibility, the evaluations that take place under Sections 102, 103 and 112 should be applied in the overwhelming majority of patent validity cases. In the case of an implied exclusion under Section 101, as in this case, ineligibility should only be applied in the clearest cases where the patent would preempt the most fundamental building blocks of technology.

 

Brief of the Intellectual Property Law Association of Chicago as Amicus Curiae in Support of Neither Party

More than 1,000 members make up the Intellectual Property Law Association of Chicago (IPLAC), a voluntary bar association operating since 1884. It is the country’s oldest bar association that has a sole focus on intellectual property law. Its members are often involved in intellectual property litigation on either side of the aisle, whether as a plaintiff or as a defendant.

The summary of arguments in the IPLAC amicus brief reiterates the low threshold of Section 101, stating that the elasticity of this section “has made the U.S. patent system one of the strongest in the world.” In order for a patent to be ineligible under Section 101, it must by necessity include natural phenomena, laws of nature or abstract ideas, including mathematical algorithms or fundamental business principles. By utilizing Section 101 as an inclusive threshold, the U.S. patent system can continue to foster “innovation and public disclosure over a wide variety of useful arts.”

IPLAC also advises against various patent eligibility tests adopted by members of the court to handle cases of patent validity. This has led to a diverse spectrum of standards where continuity in decision making is more desirable. Many of these tests also introduce the problem of defining inventiveness, which the IPLAC brief seems to argue is a job that Section 101 was not written to perform. The lack of a uniform definition for “invention” also proves problematic in this regard.

The IPLAC brief concludes by urging the court to continue to apply prior precedents regarding patent eligibility exceptions to computer-implemented inventions under Section 101. The one test for patent eligibility advocated by IPLAC is a simple two-question test which could be summed up as: Do the claims include an abstract idea, mathematical formula or similarly unpatentable material? And, are these natural laws applied to a new and useful end? This is an effective way to judge the patent eligibility of software inventions, IPLAC argues, because at some level every software patent relies on a mathematical algorithm or abstract idea.

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Brief of Amicus Curiae International Business Machines Corporation in Support of Neither Party

IBM’s position as a global leader in technology development is impossible to ignore. Since being founded more than 100 years ago, the company is responsible for the development of virtual machines and the relational database. Its employees have included a number of scientists and engineers whose work with IBM have earned them honors such as the National Medal of Science and the National Medal of Technology. Over the last 21 years, no organization has been awarded more patent rights from the U.S. Patent and Trademark Office than IBM.

Even in its neutral stance, IBM uses a lot of pointed and harsh language to describe the current status of patent law as applied by the USPTO. As the corporation argues, software has been around in some form since the 1950s, it is critical to our nation’s economy and it currently has become an important medium for systems in many other industries, including automobiles and medicine. “The fact that the court is now – in 2014 – actively considering such a basic question as whether computer-implemented inventions such as software are even eligible for patent protection is deeply troubling,” the brief states.

This brief reiterates many of the problems stemming from the court’s inability to find a working test for determining the patent eligibility of software, especially under the terms of Section 101. Although some have taken the view that most software simply takes an abstract idea and applies it to a computer-implemented medium, IBM argues that “even the most problematic computer-implemented invention will be meaningfully different from and narrower than the associated abstract idea.” Instead of declaring software ineligible under Section 101, which could create a reaction that seriously affects software development in our nation, Section 103 and its requirements for non-obviousness should be applied to determine patent eligibility for software. Section 101 rejections won’t foster technological development and improvements to patent granting structures for software in the same way that Section 103 rejections would.

IBM concludes by encouraging the court to consider software inventions as patent-eligible under the terms of U.S. Code Title 35 Section 101. Questions as to the validity of software patents must be evaluated under other sections of Title 35. The official position of IBM is that most of these evaluations regarding software should focus on Section 103 of Title 35.

 

Brief of the Association of the Bar of the City of New York as Amicus Curiae in Support of Neither Party

The Association of the Bar of the City of New York, first founded in 1870, is a non-profit organization of more than 24,000 members involved in a wide range of law-related activities. It’s Committee on Patents is one of more than 150 standing and special committees supported by the organization. This brief, which supports neither party, is filed with the aim of improving the administration of patent laws, one of the goals of the Association.

The Association’s arguments begin with a look at what they deem is Federal Court misapplications of precedents in two cases: Diamond v. Diehr (1981) and Mayo Collaborative Serv. v. Prometheus Lab., Inc. Decisions in these cases have led to a variety of approaches with how to handle patent eligibility claims. A focus on considering claims as a whole to determine whether the claim is patentable, akin to Paul R. Michel’s suggestions above, is heavily promoted here.

Like many other briefs we’ve looked through, this one also focuses on the drawbacks of using Section 101 as the major determinant of patent eligibility in this case. Even in cases where an invention is “routine, well-understood, or conventional,” ineligibility should be determined under Sections 102 for novelty, Section 103 for non-obviousness and Section 112 for claims specification.

This organization is a proponent of any decision that considers patent claims as a whole, as is consistent with the finding in the Diehr case. It also supports the analysis of claim construction as a prerequisite for invalidity analysis prior to any Section 101 inquiries. Finally, it encourages the Supreme Court to decide in a way consistent with the view that patent eligibility determinations under Section 101 don’t take analysis of novelty or obviousness into account.


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Posted in: Computers, Gene Quinn, Guest Contributors, IP News, IPWatchdog.com Articles, Patentability, Patents, Software, Steve Brachmann, US Supreme Court

About the Authors

is a US Patent Attorney, law professor and the founder of IPWatchdog.com. He is also a principal lecturer in the top patent bar review course in the nation, which helps aspiring patent attorneys and patent agents prepare themselves to pass the patent bar exam. Gene started the widely popular intellectual property website IPWatchdog.com in 1999, and since that time the site has had many millions of unique visitors. Gene has been quoted in the Wall Street Journal, the New York Times, the LA Times, USA Today, CNN Money, NPR and various other newspapers and magazines worldwide. He represents individuals, small businesses and start-up corporations. As an electrical engineer with a computer engineering focus his specialty is electronic and computer devices, Internet applications, software and business methods.


Steve Brachmann is a writer located in Buffalo, New York. He has worked professionally as a freelancer for more than five years. His work has been published by The Buffalo News, The Hamburg Sun, USAToday.com, Chron.com, Motley Fool and OpenLettersMonthly.com. He also provides website copy and documents for various business clients.




22 comments
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  1. The year is 2014….

    We have zillions of those CPUs, GPUs, DSPs, FPGAs, ASICs all around us in zillions of products for several decades…

    And now they are arguing the very basics of patent law as applied to all of those things ???

    Are those people crazy ????

  2. angry …. yes … they are

  3. It is worth reading US7725375 to which Dennis Crouch has drawn attention and also the Alice brief.

    In essence the problem that the invention addresses is settlement risk, which was a real world and long-standing problem in financial transactions, especially those involving derivatives and foreign exchange. The invention seeks to reduce settlement risk which in the context of these high volume automated transactions is arguably technical. If the Alice invention reduces settlement risk in a new and better way, rather than merely automating existing practice, then patent-eligibility should be a given.

    Most amici briefs filed appear to be from academic and similar sources not altogether ion touch with the reality of the case. Abstract law is not the point in any case – what is crucially important is the underlying factual matrix, which in this case for at least some of the disputed claims may point towards eligibility. But there is no short cut – the judges or their associates should get their hands dirty with the facts before reaching their conclusion.

  4. Paul,

    What realy annoys me (and I believe it equally annoys other engineers with patents) is how court patent cases involving purely business methods and financial transactions ruin patent laws for the rest of us – electrical, mechanical, computer etc. engineers working on real technological advances

    We had Ebay SCOTUS decision on some ecommerce auction transactions and voila – we lost injunctions for patent holders with patents on real tangible mechanical and electrical devices, not some financial schemes

    I am sick and tired of this

  5. While the brief by his Honor retired Chief Judge Michel may be accurate, I think that the called-for repudiation of Flook (an aberration is strong language), and a call to clarify the muddle of Mayo will not be well received by the current members of the Supreme Court.

    angry dude, while I may sympathize with your annoyance, I too am annoyed as your view is too much engineer and not enough lawyer. Your desire for “real technological advances” is not the only thing meant to be covered by patent law. Such a NIMBY attitude is exactly the wrong attitude to have.

  6. Anon,

    be careful what you wish for because you might get it:
    a society populated with lawyers, politicians and business types… and also minimum wage workers serving food … if there is enough food to feed all of you guys by then…

  7. angry dude,

    You are letting anger cloud your judgment and you are showing a lack of reason. Innovation in business methods is not synonymous with minimum wage, only menial service type jobs.

    Your bias is showing. Blind enmity towards any group – be they engineers, lawyers, or whomever is a poison of the mind and soul. Being too technical leaning simply is not good, healthy, or balanced. Do not assume that having balance and understanding in both the technical world and the legal world is a bad thing.

  8. Bad facts make for bad laws. This case and Bilski are appealing to the “I hate software patents” crowd because they deal with something that seems trivial to implement. Unfortunately, the overall effect they want is to ban ALL software patents, no matter what.

    They need to realize that software is used in all electronic devices. And if they ban software patents, consumer products like cell phones, cameras, GPS, will all be affected. And I don’t know if they realize that. The anti-software patent people seem to think that the only thing software patents are used for are hedging and escrow, not realizing software is used to process cell phone signals, images, and satellite data. (And, although I just mentioned three types of devices, software is obviously used in many, many more devices.)

  9. It may be hard for those of us involved in the patent system to understand the visceral hostility that exists towards it, but fundamentally you have to understand the socialist mindset – hatred of individual merit, competition, unequal outcomes vs. equality of opportunity, the profit motive, etc. In their view every patent holder is a troll that is bent on oppressing the masses. They don’t understand why we can’t just all share and share alike, rotwithstanding the repeated historical failures of that philosophy. That is really what it boils down to.

  10. Anon,

    I don’t assume anything anymore, except that if an individual is not compensated for his work and expenses coming up with a technical invention and getting a valid patent on it, next time he will not have any incentive to do it again

    Is this too much of an assumption to make ?

  11. The patent system does not actually provide a direct incentive to innovate. Creative people can’t help but innovate. It’s in their DNA. But the patent system does provide a powerful incentive to commercialize innovation, which is the real issue from a practical economic standpoint. It incentivizes investment in disruptive technology. Without it, the inherent risk involved would greatly retard high-tech economic growth.

  12. Once again angry dude your words betray you.

    Why the artificial limit on ‘justice’ constrained only to technical inventions?

    Innovation rightfully comes in more flavors than merely technical.

  13. I have no objection to business method patents per se, but when they are merely the computerization of a known business method, which should be rejected on 103 grounds, but end up being used to buttress the anti-software patent 101 argument, then they jeopardize genuine software patents as a whole.

  14. Ron,
    you are saying : “Creative people can’t help but innovate” – this is just plain wrong.
    I can sit all day long on a beach, watching birds, sipping beer, doing nothing, every day…

    Anon,
    I didn’t say innovation is limited to technological inventions (please, read it broadly – mechanical, electrical, computer software, chemical, biochemical, genetical, agricultural etc etc)
    You can be very innovative lawyer or trader or banker or politician (those are probably the most innovative…)
    But at the end of the day, whole society-wise, it is technological invention and subsequent innovation that puts bread and caviar on your table (and protects you and your family from those evil countries overseas dreaming to end US dominance…)

  15. Angry dude, I bet even while you’re sitting on that beach doing “nothing” you can’t stop the gears from turning and coming up with new ideas. The profit motive is what gets you up off the beach to go and do something with those ideas.

  16. Sorry angry dude, you are still showing an immaturity and lack of reason with your selective rationale that it is the ‘technical innovations’ that are the ‘worthy’ ones.

    There is just no basis for holding this selective view and attempted misapplication of patent law. It is rather backwards to be honest with you, and I start to lose sympathy big time for your anger. Innovation is not as constrained as you would have it.

    It is not.
    It should not be.
    It should not be rewarded differently.

    You may have surmised by now (or may not – I do not know your level of legal knowledge) that our exchange mirrors the larger debate going on across several blogs about what should patents cover: the Useful Arts or the Technical Arts. I am pretty sure you could guess what the US law covers.

  17. anon,

    I am not a lawyer and have no interest in discussing legal concepts with you or anyone else for that matter

    I just pointed out that it is technological innovation going on in the US for the last couple centuries (the very broad category including mechanical and electrical engineering, computer software, chemical and biochemical engineering, agriculture etc etc etc) that ultimately feeds you and your family and protects your lifestyle from other countries without working patent systems and consequently with less incentives to innovate

    not all “useful arts” are so useful to the survival of this country in the long run

  18. angry dude,

    Thank you for letting me know that you are not a lawyer.

    If you do not want to discuss legal concepts, though, may I suggest that you do not post here. I would like to discuss legal concepts on a blog for discussing legal concepts. If all you want to do is vent from a tech standpoint regardless of what the law is, I suggest you go t,o and stay at, slashdot or techdirt.

    If you think the only thing that protects me and mine is ‘tech,’ your ego is as over bloated as your misconceptions of law. I do not deny the importance of tech – I just do not blind myself to what else is out there.

  19. Response caught in filter – please release.

  20. Released.

  21. Anon,
    Thank you for your kind suggestions
    I believe I can still teach you a thing or too about risks/rewards of patent trials to your clients, like application of Rule 11, discovery requests, motions for summary judgement .. you know.. the important stuff… not talking some meaningless claim semantics to poor PTO examiners
    You are not a real trial lawyer, are you ?

    And you can talk yourself to slashbots and techdirt miky masnick – they will straighten you out about patents:)

  22. angry dude – thank you and please continue to post on those things that would add value. It is the items that do not add value, that sound only in misplaced griping that I would ask you to refrain from.

    And I will kindly turn down your offer to be ‘educated’ by Mike Masnick. If I ever do need a lobotomy, I may look you up and ask for an introduction.