On Thursday, June 19, 2014, the United States Supreme Court issued its much anticipated decision in Alice v. CLS Bank. In a unanimous decision authored by Justice Thomas the Supreme Court held that because the claims are drawn to a patent-ineligible abstract idea, they are not eligible for a patent under Section 101.
In what can only be described as an intellectually bankrupt opinion, the Supreme Court never once used the word “software” in its decision. This is breathtaking given that the Supreme Court decision in Alice will render many hundreds of thousands of software patents completely useless. While the Supreme Court obviously didn’t want to make this decision about software, the holding does make it about software because each of the ways software has been claimed were ruled to result in patent ineligible claims. On first read I don’t see how any software patent claims written as method or systems claims can survive challenge. For example, these claims to IBM’s Watson computer, which is really akin to the first generation omnipotent Star Trek computer, seem to be quite clearly patent ineligible. See Is IBM’s Watson Still Patent Eligible. It is impossible to see how the Watson claims remain patent eligible in light of this ruling and how the Alice claims were written. The only potential solace for IBM and others would be if the Federal Circuit narrowly interprets this decision noticing that the Supreme Court seemed almost preoccupied by the fact that the patent claims covered a financial process. Still, the structure of the claims are nearly identical, with Alice’s claims actually having more recited structure, if anything.
More difficult to understand is how the Court could issue a decision that doesn’t even use the word software. Software is clearly patent eligible if you read the patent statute. Software is mentioned throughout the statute. It was specifically mentioned in the America Invents Act in 2011. Tax strategies are not patent eligible in and of themselves, but the AIA says that software is not patent ineligible just because it incorporates a tax strategy. This is the type of analysis the Supreme Court engaged in the Bilski decision finding that business methods are patentable.
We’re back for our first profile of IBM in a few months here at IPWatchdog’s Companies We Follow series, and as per usual, we’re finding it almost impossible to keep up with the corporation’s recent innovations. IBM is the source of the highest level of patent filings at the U.S. Patent and Trademark Office. We hope that today’s profile of this American multinational corporation can give our readers even just a small glimpse at this company’s intellectual property goals.
IBM is renowned for its development of supercomputing programs, which is the focus of today’s featured patent application. This filed application describes a system of analyzing digital content in various forms in order to automatically determine the appropriate security level for that content, eliminating the need for network users to manually apply security measures on their own. We also found a couple of technologies for migrating consumer services to cloud-based environments, and a unique method of determining broken lamps in public lighting systems by utilizing satellite images.
Pictured (from left) Francis Hamilton (IBM engineer), Clair Lake (IBM engineer) Howard Aiken (Harvard professor) and Benjamin Durfee (IBM engineer) — 2014 National Inventors Hall of Fame inductees for their invention of the Automatic Sequence Controlled Calculator (ASCC)
Later this evening the National Inventors Hall of Fame will induct three IBM (NYSE: IBM) engineers for their invention of the Automatic Sequence Controlled Calculator (ASCC), which was developed more than 70 years ago to rapidly and accurately perform complex mathematical calculations. The ASCC was a precursor to today’s cognitive computing systems like IBM Watson, which rapidly analyze data and learn and interact naturally with people. The ASCC ushered in the programmable computing era, which would ultimately provide the ability to put a man on the moon and to make the Internet a reality.
IBM inventors Benjamin Durfee, Francis Hamilton and Clair Lake, as well as Harvard professor and co-inventor Howard Aiken, will be posthumously honored by the Hall of Fame in a ceremony at the United States Patent and Trademark Office, the home of the National Inventors Hall of Fame. The National Inventors Hall of Fame, Inc. is a not-for-profit organization dedicated to recognizing and honoring invention and creativity, as well as honoring the men and women responsible for the great technological advances that make human, social and economic progress possible.
Durfee, Hamilton, Lake and Aiken will be inducted for their invention disclosed in U.S. Patent No. 2,616,626, which is simply titled Calculator. The patent application was filed on February 8, 1945, but did not issue until November 4, 1952. The invention described in the ’626 patent was the first automatic digital calculator able to retain mathematical rules in its memory and not require reprogramming to solve a new set of problems. It represented a significant advance. Because reprogramming was not necessary, the invention was a powerful improvement, offering far greater speed in performing a host of complex mathematical calculations.
Our second profile of Hewlett-Packard’s innovations for the Companies We Follow series here at IPWatchdog features a range of intriguing technologies for both businesses and individual consumers. We’ve searched the databases of the U.S. Patent and Trademark Office to find the most interesting patent applications and recently issued patents assigned to HP. Today’s column features an interesting array of inventions from this global leader in hardware and software product development.
The featured patent application in this edition of the Companies We Follow series focuses on mapping technology, an area of innovation that we’ve seen from many of the electronic device and software manufacturers we cover. This system enables more effective road map generation from a plurality of sources of GPS data, including taxis and other vehicles on the road which are already equipped with location data sensors and devices. We also discuss a couple of patent applications which would protect printing technologies, as well as a novel system of electronic circuitry to prevent unauthorized access of cash drawers.
Electronics developers and manufacturers always make for great profile subjects in IPWatchdog’s Companies We Follow series, and today we want to take a look at Fujitsu’s patented technologies for the first time. This company, awarded the 12th-most U.S. patents among all companies during 2013, has many patent applications and issued patents published every week by the U.S. Patent and Trademark Office. Just in the last two months, we’re seeing some very interesting technologies related to many technologies, including hardware development and improvements to digital networking systems.
Our featured application today discusses a very useful technology for corporate digital networks for detecting illegal connections with external apparatus created through malware. This system addresses some of the ever growing concerns related to cyber attacks on businesses. We also cover other patent applications which discuss better simulation apparati for determining the effects of devastating water events as well as an improved remote car starter that draws less battery power.
Justice Antonin Scalia, who seemed most favorable to Alice.
Once Chief Justice John Roberts said “[t]he case is submitted,” which occurred this morning at 11:05 a.m., the reading of the tea leaves began.
The Supreme Court was very hot Court, with a lot of questions on the mind of the Justices. After reviewing the transcript I am left believing the Court is likely wondering whether it is possible to find the Alice patent claims to be patent ineligible while also ruling that software patent claims are not all patent ineligible. Surprisingly, it seemed as if Justice Scalia was most persuaded by the patent eligibility of the claims, directly saying at one point that the issues circling the case seem to really be about 102, not 101.
While I support the patent eligibility of the patent claims, particularly the patent claims drawn to a system, it seems undeniable that Alice missed many opportunities to score easy points. Indirect arguments were made by Alice that didn’t seem very persuasive. Indeed, if one is to predict the outcome of the case based on oral arguments alone it did not go well for Alice today. Only three things give Alice supporters hope after this oral argument as far as I can tell. First, the government seems to be asking the Supreme Court to overrule precedent in Bilski that is not even four years old, which simply isn’t going to happen. Second, the egregious overreach and outright misleading nature of the CLS Bank argument should raise a legitimate question or two in the mind of the Justices. Third, the reality simply is that at least the systems claims recite numerous specific, tangible elements such that it should be impossible to in any intellectually honest way find those claims to cover an abstract idea.
BEAR: In Judge Michel’s brief, he writes about not confusing §101 with §102 and §103. I’m also looking at this and thinking that patentability questions regarding “abstract ideas” may, perhaps, be better handled under §112 on specificity grounds. What do you think about that?
QUINN: I totally agree. And I think that that was the way that Director Kappos meant it when he was at the Patent Office and the Bilski case came out. That was what he was urging the examiners to do. Do not to make this a §101 issue but instead get the §112 issue. I think that’s the exact right approach because the real question I think they’re struggling with is whether there is an invention there. You can’t know whether there is an invention there until you ask what does somebody of skill in the art understand by reading the disclosure. And what some want to do is make it a §101 question so that they don’t have to do any analysis or heavy lifting.
Eric Gould Bear knows software. He is a successful inventor, has spent over 25 years working with numerous Fortune 500 corporations and he is also a testifying expert witness for patent infringement cases. With the oral argument in Alice v. CLS Bank scheduled for Monday, March 31, 2014, we recently sat down to talk about the briefs filed and issues in the case. In part 1 of our conversation we discussed the false distinction that is erroneously made between hardware and software, as well as the ACLU amicus brief, which he called “embarrassing.”
In part 2, which follows below, we discuss why software start-up companies need patents. Bear also further analyzes the briefs filed, including the one filed by LinkedIn, Netflix, Twitter, Yelp and Rackspace, which he characterizes as taking “a fairly radical stance.”
Without further ado, here is part 2.
QUINN: I was hoping you might be able to give us an idea of how a software startup company uses patents as an asset to leverage building, growing, and further innovating?
BEAR: Sure. Startups have to move with velocity and with a high level of excellence simultaneously. And they’re fiscally challenged for the most part, so have to operate very lean. There’s a challenge with regards to patent filing because the costs are hard to justify as having any immediate benefit. And when you weigh your weekly or daily burn, it’s really hard to swallow the costs of investing in patents. That’s certainly the case for startups like the ones I advise at the Capital Factory incubator in Austin. Most don’t know with certainty if they’re even going to survive to the next year.