No question exists that patent eligibility under Section 101 has been, and remains, the most active question in patent law. Watching the rapid flow of cases back and forth between the Federal Circuit and the Supreme Court exceeds the excitement generated by most TV shows in sheer entertainment value. The only question open for discussion is whether we are watching “Game of Thrones,” “Survivor”, or “Modern Family.” Actually, the best choice may be “Lost”.
To understand the Supreme Court’s decision in Alice Corp. v. CLS Bank Int’l, a page of history provides more illumination than a book of Lewis Carroll references. Here we need to pick up at the point when everyone thought the computer patentability wars were over.
By the late 1990’s, the last frontier was business methods. We had absorbed Diamond v. Diehr and moved on to Beauregard claims and propagated signals. Everyone was making, or wanted to be making, tons of money in the Dot.Con era, and little patience remained for outdated rules.
One of the frequent claims made by those in the anti-software patent community relates to Twitter and the clearly erroneous belief that patents are not important to the company. Indeed, recently when I wrote Fairy Tales and Other Irrational Beliefs About Patents the claim arose in the comments suggesting that Twitter is proof that patents are unnecessary to succeed. Quite to the contrary. If you actually concern yourself with facts, Twitter is a perfect case study to demonstrate just how important patents, particularly software patents, are to a start-up company that has aspirations of going public.
Doubt me? Perhaps you will believe Twitter themselves. In repeated filings with the Securities and Exchange Commission since October 2013, Twitter has explained over and over again just how important their patented technology is to the company. They have also repeatedly explained that unlike other companies and competitors, even with nearly 1,000 patents, their own patent portfolio is extremely small by comparison. This poses real concerns for Twitter, which is why they warn the SEC and investors of the ramifications of such a small patent portfolio with every new filing.
Let’s begin our tale about Twitter at the start. Twitter, founded on March 21, 2006, was initially believed to be of the opinion that patents didn’t matter. Behind the scenes and unknown to many, Twitter was actively filing patents very early on in the development of the company. This is hardly shocking news given that Twitter’s initial round of funding dated back to 2007 and the near universal reality that high-tech investors not only love patents, but they demand patents. Investors love patents because if the company does not succeed at least some valuable patent assets will remain, which can be sold to recoup losses.
This article tries to bring a little more clarity to what is a computer-implemented invention —and what is an obvious use of a computer —by reviewing some of the Alice v CLS Bank oral arguments.
Certain things are obvious. It was obvious in the oral arguments that it was a challenge for both the Supreme Court judges and the lawyers to distinguish between abstract ideas, ideas, computer programs, technological innovations, patentable subject matter, and inventions. (This confusion also showed up in the seven different written opinions of the judges in the Appeals Court review of this same case.)
In the oral arguments (P34-L17), Justice Sotomayor in response to a discussion on abstract ideas, inventive contributions and the Mayo test for technological innovation asked Mr. Perry, counsel for CLS Bank, the following…
Justice Sotomayor: “How about email and just word processing programs?”
When the U.S. Supreme Court finishes hearing arguments in the upcoming case Alice Corporation v. CLS Bank International, it will be asked to judge whether or not software and computer-implemented inventions are eligible to receive patent protections through the U.S. Patent and Trademark Office. Should the Supreme Court uphold the original decision and declares that the Alice’s patents on computer-implemented systems for managing risk in financial transactions are patent ineligible, thousands upon thousands of software patents could become invalidated.
We discussed some of the issues in play with this major case in our previous look at amicus briefs filed with the U.S. Supreme Court for this case. We have also profiled the IBM amicus briefthat argued that the abstract idea doctrine was unworkable. These parties, though largely neutral, had a number of disdain for how the judiciary has handled the issue of software’s patent eligibility under Section 101 of Title 35 of the United States Code. Today, we’re taking a look at briefs filed for either side of this historic case to get a broader sense of the viewpoints involved in this issue. A number of major corporations, non-profit organizations in technological fields and renowned scholars have lent their ideas to these briefs, and readers may find their views on the patent eligibility of software programs to be enlightening.
A quick perusal of the amicus briefs published online by the American Bar Association shows that only a few of the briefs filed are supporting the petitioner, Alice Corporation, in this case. In fact, only three briefs in support of the petitioner are shown on the ABA’s official site listing amicus briefs for this case; there are a total of 40 amicus curiae briefs shown on that site, as of this writing.
Much of this negativism is based on the poor job the US patent examiners have done in weeding out those many patent applications where the so-called invention is just one of the almost infinite, but obvious, ways one can automate a manual or semi-automatic process or procedure. But there are also true inventions that use a computer as part, or all, of the implementation of the invention. There is no reason to throw out the baby with the bathwater. So it is of utmost importance that we examine the many falsehoods related to software patents.
In this new article I intend to provide facts about software and the software industry to debunk these misnomers, myths, misconceptions, and just pure misunderstandings about “software patents”.
In a few weeks the United States Supreme Court will hold oral arguments in Alice v. CLS Bank. At stake in this case is the future of software patents. Half of the Federal Circuit de facto ruled that software is patent ineligible. Of course they could not come right out and say that because it would contradict both settled Supreme Court precedent and patent laws enacted by Congress and codified in Title 35 of the United States Code. Nevertheless, the undeniable position of half of the Federal Circuit was that software is not patent eligible because to these Judges none of the claiming techniques that are used to write software patent claims result in patent eligible subject matter being claimed.
In preparation for the oral arguments we are shifting through the briefs. I have already written about the IBM brief, see Supreme Court “Abstract Idea Doctrine” is Unworkable. We plan multiple articles leading up to the oral argument that discusses the various briefs filed, and complete coverage of the oral arguments. Today, however, I write about the brief of the United States Government filed by the Solicitor General, which is simply disingenuous.
Truthfully, to call the Solicitor’s brief disingenuous is being charitable. The logic, if you can call it that, necessary for the Solicitor’s arguments to be correct is extraordinarily tortured, not to mention circular and dependent upon itself for support. The premise of the argument made by the Government is simply false. The Solicitor tells the Supreme Court that the patent claims in question are to an abstract idea, which is flat wrong. But in a bizarre twist the Solicitor pivots to then say that what is covered is not an abstract idea but it is not necessary for there to be an abstract idea protected in order for the claim to be patent ineligible as an abstract idea. Sadly, I’m not making this up.
What follows is the Introduction and Summary of the Argument included in the IBM amicus brief filed at the United States Supreme Court in Alice Corporation Pty. Ltd. v. CLS Bank International. While many attorneys contributed to this brief, as you will see them listed on the front cover, former Solicitor General of the United States Paul D. Clement is the Counsel of Record.
I think it is fair to say that the theme that comes through the loudest in the IBM brief is this: The abstract idea doctrine is unworkable. To that I say a resounding AMEN! If the Supreme Court cannot or will not tell us what an abstract idea is how can we any longer pretend that the jurisprudential path the Court has taken will lead to predictability? At least insofar as software is concerned there is a complete and total lack of predictability. There is also no uniform application of the law, which at least conceptually should raise concerns of disparate treatment of those similarly situated.
Below I provide additional thoughts on the IBM Summary of the Argument in the format of comments from the peanut gallery, or perhaps as a patent law equivalent to Mystery Science Theater 3000. In order to differentiate my thoughts/comments from IBM amicus brief, my comments are italicized, colored, indented and tagged with the IPWatchdog logo.
The United States Supreme Court is poised this term to decide CLS Bank v. Alice Corporation, which could make meaningful strides toward settling once and for all the patent eligibility of software. The Supreme Court is known to like to dodge the most important questions we all need answered, and that trend is almost certainly going to continue in any decision in CLS Bank. But the Supreme Court won’t be able to dodge the fundamental question about whether software is patent eligible. The will likely, and unfortunately, dodge the question about what specifically must be recited in patent claims in order to properly define a software, or computer implemented invention.
Software is now and will remain patentable in the United States even after the Supreme Court’s decision in CLS Bank. The Patent Act is replete with references to software and computer implemented inventions. In fact, in 2011 Congress essentially said that tax strategies could not be patented in and of themselves, but this exclusion relating to tax strategies does not render an otherwise patent eligible software program patent ineligible. Thus, Congress has spoken, and on this particular issue Congress will be the final word because there is no chance the Supreme Court will rule software patents unconstitutional. That issue is not even before the Court.
Congress clearly has stated that at least some software is patent eligible, and so will the Supreme Court. That being said, the real question is how do you describe a software related invention to satisfy the patent requirements? The short answer is that it takes quite a bit more disclosure than you might otherwise think. Long gone are the days of cheap, easy software patents.
James Madison, father of the Constitution and proponent of strong patent rights.
As the end of 2013 approaches and I look back on what has transpired I am saddened to see that through the year patent rights have continued to erode. It is difficult to comprehend just how far the pendulum has swung. At one time strong patent rights were viewed by our Founding Fathers as obviously necessary. Now any patent rights are ridiculed as a relic of the past that simply stands in the way of innovation. The reality, however, is that patents don’t stand in the way of innovation; patents foster innovation. But so many won’t even take the time to inform themselves. Rather they equate “innovation” with a new consumer product. But to innovate is to do something new. Innovation has nothing in and of itself to do with a new products or services.
What those urging a weaker patent system want is the ability to release products and establish services regardless of whether they are infringing others. But those who infringe are not innovators, at least not in the most broad sense. Sure, they may have improved something, but if they are infringing then what they have done is copy an innovator. How and why that isn’t self-evident is a mystery. Copying is not innovating!
And if patents were getting in the way of innovation then why aren’t we seeing a standstill in the smartphone industry? The arguments made by the anti-patent crowd are ridiculous on their face, yet decision makers just nod their head in agreement as if they speak the gospel. The truth is the smartphone industry started with the iPhone in late 2007. It is just 6 years old! The phones from 2007 look and function nothing like the smartphones do today, and every new version has new improvements, better battery life, stronger structural integrity, glass that is harder to break, operates faster, has better cameras, etc. etc. For an area that is allegedly being suffocated by patents there sure is a lot of readily apparent improvement.
This article is the second in a series to provide some help to the Supreme Court as they prep for CLS Bank. See also Help for the Supreme Court in CLS Bank. Now, I realize the Supreme Court has other priorities; but I, as a patent guy, do not. If we (they) screw this thing up, it will have far, far reaching effects which will not be fully known for years to come. This is the Chakrabarty of our age!
There is considerable popular press antipathy to patents right now; big left coast tech and east coast banking are winning the PR battle, and this needs to be turned around. Did you read any of the overblown amici in Chakrabarty about the awful effects of patenting living organisms? Recently the Wall Street Journal just had an Op Ed about the CAFC being Carter’s Costly Patent Mistake. Is there any greater insult a conservative, allegedly business minded rag could hurl? OMG! I think not. It is time for us to head for the sound of the guns! (Perhaps, just perhaps, a little melodramatic. We shall see. But Gene has already responded to the WSJ article at Defending the CAFC, Again, on Software Patents.)
Why am I addressing such a fundamental issue? Because this is, in part, why we’re so fuzzed up right now about software, computer implemented methods, and business methods, etc. and their originality and patentability. It is hard for the lay person to differentiate. You see, the silicon types have made us believe that computers are on the verge of sentient being capability. We have IBM’s Watson, we have the iPhone Siri, self-driving cars, distance maintaining cruise control, self parking cars, etc. I expect people out there really believe you can ask a “computer” a question and expect it to really “think” up an answer. Our brains, we are told, are just sophisticated computers. Likewise we have people believing computers make mistakes, and computer glitches are running amok with our healthcare, crashing trains, performing surgery, etc. None of it is true in the sense of the ordinary definitions we apply to these things; yet it is these definitions that are the crux of our confusion over computers and whether the instructions we provide to control them really result in something patentable or, in anything at all. Isn’t the computer, at some threshold, just doing whatever a computer does? Well, not really; you see a computer does nothing without a program or power supply. Let’s find out why.