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.
Eric Gould Bear is an inventor on over 100 patents and patent applications in the software space. He has spent over 25 years working with numerous Fortune 500 corporations with respect to assisting them in the creation of new user experiences. He is also a founder of the design studio MONKEYmedia, who signed onto the Trading Technologies amici brief filed in Alice v. CLS Bank at the Supreme Court. Bear is also a testifying expert witness for patent infringement cases. He is an expert in the software/patent space, and has seen the industry from multiple different angles over the years.
With the oral argument in Alice v. CLS Bank scheduled for Monday, March 31, 2014, I reached out to Bear to see if he would go on the record to discuss the issues he saw in the various briefs filed, what was good, what was problematic, and how he as a software expert would try and convey the issues to a layperson, or scientifically untrained jurist such as the Justices on the Supreme Court. He agreed and we spoke on the record about the issues, using as our focal point several of the high profile amici briefs filed.
What appears below is part 1 of my 3 part substantive software converation with Bear. In part 1 we discuss the false distinction between hardware and software, and Bear goes into deal with examples, saying at one point that most of the innovation today relates to software. He also takes issue with the ACLU amicus brief, calling it “embarrassing.”
There are numerous briefs listed on the ABA’s brief publication webpage for Alice Corp. v. CLS Bank that are filed in support of the respondent, most of which make specious claims about software patents blocking innovation, or which make arguments that claims that specifically recite computers, data storage units, devices and more are somehow abstract and imaginary. These arguments should be easy enough to dispose of as ridiculous on their face, but who knows how the Supreme Court will respond. Still, one would hope that the Supreme Court would notice that neither patents generally or software patents specifically have done anything to block innovation in the smartphone industry.
Whereas the Alice supporters feel that the U.S. Patent and Trademark Office’s issuance of software patents are important for protecting and spurring innovation in many fields, the supporters of CLS Bank have largely responded that software patents hurt innovation. But that can’t be! One of the areas critics always say has been allegedly hamstrung by patents, the smartphones industry, is barely over 6 years old. Have patents stopped innovation of smartphones? Hardly. In fact, with every new version companies tout just how much more the phones do and how they are so far superior to the previous model. Thus, it is easy to see that those claiming that software patents block innovation simply ignore market reality and how the functionality of current devices (which is thanks to software) match up with previous generations of devices over the last 6 years. Corporate critics must also ignore their own marketing of new smartphones, which directly contradicts the ridiculous claim that software patents are preventing innovation. Still they make these and other specious arguments as if they are true.
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.
On January 6, 2014, I had an on the record conversation with Donald Chisum and Janice Mueller, both exceptional and well known patent scholars in their own right. Together Chisum and Mueller form the faculty of the Chisum Academy, which offers a three-day intense seminar that is limited to ten (10) participants.
In part 1 of the interview we discussed patent reform and started to discuss patent eligibility, particularly as it relates to software. We pick up the discussion there.
QUINN:In looking back, Justice Stevens’ decision in Bilski had pieces that would have made for a much easier régime to live under because he did say in one in particular area that the innovation in question in State Street was patentable because it was a device. I’m optimistic that we’re going to get something good out of the Supreme Court in CLS Bank. But having said that, I’m still worried, because it seems to me that they totally missed the boat in Mayo where they said we’re not going to follow the solicitor’s invitation to let sections 102, 103, or 112 invalidate that claim. That wasn’t really an invitation, that’s what the statute mandates and up until then Mayo that was always what the Supreme Court had mandated. So you just never know what you’re going to get from the Supreme Court, but I can’t imagine we’re going to get anything less intelligible than the Federal Circuit en banc decision in CLS Bank. Now Janice, you have spent a lot of time teaching patent law to students. How would you describe that decision to people who are new to this field?
Don Chisum (left) and Janice Mueller (right) at the United States Patent and Trademark Office.
I’ve known Janice Mueller for a number of years dating back to when she was a full time Professor of Law. Mueller wrote, in my opinion, one of the best summaries of patent law and I recommended it to my patent law students, as well as new practitioners, inventors and entrepreneurs. She has now left full time teaching, but she has not left patent scholarship behind. She is now the author of a patent treatise and she co-teaches in the Chisum Academy with Donald Chisum, who everyone in the patent world knows from his definitive encyclopedia of patent law titled simple Chisum on Patents.
Recently Mueller wrote to me to let me know about the upcoming Advanced Patent Law Seminar that the Chisum Academy will host in Cincinnati from March 5, 2013 through March 7, 2013. I floated the idea of doing an on the record conversation with her and Don Chisum, which they both accepted.
In this two-part conversation we discuss everything patents, from patent reform legislation, to patent litigation abuse, to how the Supreme Court and Federal Circuit are handling patent matters and much more.
Without further ado, here is my conversation with these two preeminent patent scholars.
Ten years ago if you said that patent eligibility would become one of the most important, hotly debated issues in the patent field most in the industry probably would have thought you simply didn’t know what you were talking about. Five years ago some saw the issues percolating, but still many in the trenches with their day-to-day practice life would likely still have raise a cautious eyebrow and questioned why you thought even the Supreme Court might turn its back on a solid generation of well established patent law. The tone was perhaps cautious, but most couldn’t imagine that the Supreme Court and the Federal Circuit would cease their expansive view of patent eligibility.
Oh how times change!
Today, after several years of substantial turmoil, patent eligibility in a variety of economically significant technologies is extremely uncertain, including software, natural products, medical diagnostics and personalized medicine. It is with great irony that one of the few things we know with any degree of certainty is that business methods are patent eligible. We likewise know that at least some cDNA is patent eligible, except that man-made cDNA that happens to be identical to what occurs in nature. Of course, that raises more questions than it answers.
Not surprisingly, the decision of the latest Federal Circuit case on software patent eligibility – Accenture Global Services, GMBH v. Guidewire Software, Inc. – could be predicted from the makeup of the CAFC panel. Judge Lourie, joined by Judge Reyna, issued the majority opinion that the system claims were invalid. The Court followed the analysis for determining patent eligibility from CLS Bank,, 717 F.3d 1269 (Fed. Cir. 2013) and affirmed the district court’s finding that the system claims of U.S. Patent No. 7,013,284 (“the ‘284 patent”) were ineligible. Judge Rader dissented.
Accenture appealed the district court’s holding that system claims 1-7 and method claims 8-22 were invalid as not directed to patentable subject matter. Interestingly, Accenture only appealed the ruling on the system claims, thus waiving its appeal on the method claims.