My writings about open source and software patents have earned me a special place in the hearts and minds of those who harbor irrational hatred of software patents. But I am here to tell you that open source is not all bad and, in fact, should be embraced. Open source, however, is hardly something new to the patent community. Perhaps it is better to say that where open source software is heading is nothing new, and it will come as a shock to those who hate patents, but patents will be completely necessary in order for the open source community to continue to advance and live up to its full potential.

Those who are in favor of open source frequently become near apoplectic at the thought that open source software can be, and in fact should be, patented.  The reality is that forward thinking companies that operate in the open source space do make use of the patent system.  A quick search of Freepatentsonline.com shows that Red Hat, Inc., one of the preeminent open source companies in the world, is named as the assignee on some 263 US patents or US patent applications.  So if you are about to make an enormous mistake and listen to the “open source means free” community, ask yourself why a highly successful company like Red Hat uses the patent system and acquires patents.  If patents are good for Red Hat, an open source company not at all enamored with the existence of software patents, then why are software patents bad for you?  Shouldn’t you model your business off successful companies?

Although much remains unclear after the U.S. Supreme Court’s decision in Bilski v. Kappos, one thing is certain: software remains patent-eligible in the U.S. This result may not be entirely clear from a quick read of the opinions in the case. Therefore, I present the following pieces of evidence that the Supreme Court in Bilski effectively re-affirmed the patent-eligibility of software (listed, for the sake of simplicity, in the order in which they appear in the decision).

Alice enters another world through the looking glass

In Chapter 6 of Lewis Carroll’s Through the Looking Glass, Humpty Dumpty tells Alice scornfully “when I use a word, it means just what I choose it to mean – neither more nor less.”  After reading and compositing the various opinions by the nine SCOTUS Justices in USPTO v. Bilski, I, like many others, are still wondering what is a patent-ineligible “abstract idea” (other than Bilski’s claimed method for instructing buyers and sellers how to protect against the risk of price fluctuations in a discrete section of the economy, i.e., hedge against such risks) and especially what does “patent-eligible” really mean under 35 U.S.C. § 101.  The composite opinions by SCOTUS in Bilski concoct a standard for patent-eligibility that is as fuzzy and circular as the logic Humpty Dumpty employed on Alice.

As you might imagine, there are many takes on what the SCOTUS Bilski ruling actually says, including mine.  See Section 273 is NOT a Red Herring: Stevens’ Disingenuous Concurrence in Bilski where I waxed lyrical about now retired Justice Stevens’ disingenuous sophistry in his concurrence which treats 35 U.S.C. § 273 as if it didn’t exist, but which is, in fact, an implicit, if not explicit, recognition and acceptance by Congress that “business methods” (however you characterize them) ARE patent-eligible subject matter under 35 U.S.C. § 101.  See also Foaming at the Mouth III: And Then Came Bilski where I commented on the most recent “thunderbolt” from our Judicial Mount Olympus as SCOTUS summarily granted certiorari in Prometheus Laboratories, Inc. v. Mayo Collaborative Services and Classen Immunotherapies, Inc. v. Biogen Idec, and then vacated and remanded both cases to the Federal Circuit to reconsider (with equally “fuzzy” guidance) in light of SCOTUS’ ruling in Bilski.

Over the last couple weeks I have been giving more thought to open source software and what, if any role it has to play with respect to the economic future of both start-up companies and established giants.

My belief is that open source can and should play a vital role in innovation, but the way it is by and large carried forward today does little to forward innovation and an awful lot to significantly disadvantage start-up companies.  The horribly bad advice that pervades the open source community and the utter lack of knowledge or familiarity about patent law is staggering.  I don’t begrudge anyone who doesn’t like the patent system, but can you please at least not like it for a valid reason?  With the myths and disinformation spewed by those who are either clueless and loud, or those who know better and have an agenda, are drowning out rational debate and significantly impeding progress and innovation.

Unlike many of the visitors and contributors on this site, I am not a lawyer. I am a programmer who found this blog while chasing links across the Internet looking for information on software patents and what has now become one of the most anticipated Supreme Court decisions ever; Bilski v. Kappos. That was almost eight months ago at a time when I held what is probably a common view of software patents among programmers. Specifically, that they are immoral, unfair, and restrictive to innovation and creativity. I have since found that things are not as black and white as they appear and I’d like to share with you the problems as I see them, from a programmer’s point of view.

The communication between lawyers and programmers is admittedly poor. I can’t imagine very many people jumping through all the hoops to become a patent lawyer if they didn’t believe in the power of the patent system to help grow the economy. On the other hand, programmers who are frustrated with declining job security, declining benefits, and declining pay, often turn to leaders in their field, who demonize software patents. Those industry leaders who support software patents are usually the ones doing the laying off, cutting salaries, and outsourcing jobs, so it is understandable that they have questionable credentials when it comes to the opinions of the common programmer. How can we start to heal the wound and repair the damage that has already been done? We need to encourage more communication between the two parties if we are ever to end the “cold war” over software patents.

When last we left off our History of Software Patents series we were talking about In re Alappat, which by implication did away with the Freeman-Walter-Abele test for patentable subject matter by not mentioning the test whatsoever. Shortly after Alappat, a three-judge panel once again resorted to and applied the Freeman-Walter-Abele test in In re Trovato, but that was quickly withdrawn by an en banc panel of the Federal Circuit. So it seemed relatively clear that the FWA test had been abandoned. This believe was bolstered by the famous, or infamous depending on your view, case of State Street Bank & Trust Co. v. Signature Financial Group, Inc. and ultimately in AT&T Corp. v. Excel Communications, Inc., where the Federal Circuit reaffirmed its decisions in State Street Bank and Alappat.

In State Street the patent in question was U.S. Patent No. 5,193,056, which issued to Signature Financial Group on March 9, 1993. The ’056 patent is generally directed to a data processing system for implementing an investment structure which was developed for use in Signature’s business as an administrator and accounting agent for mutual funds. In essence, the system, identified by the proprietary name Hub and Spoke®, facilitates a structure whereby mutual funds (Spokes) pool their assets in an investment portfolio (Hub) organized as a partnership. State Street was in talks with Signature Financial to acquire a license, and when talks broke down they brought a declaratory judgment action to have the ’056 patent claims declared invalid.

After 6 months and 15 days we still wait for a decision in Bilski v. Kappos, perhaps the most anticipated Supreme Court patent decision of all time.  It is now 10:50 am Eastern Time and the Supreme Court slip opinion page has not added another opinion since at least 10:27 am Eastern Time.  At 10:29 am, shortly after American Needle, Inc. v. National Football League (an intellectual property licensing case I will be writing about later this week, in which the Supreme Court ruled the NFL is not a single entity for Antitrust purposes and the Rule of Reason applies to its IP licensing decisions) was added to the slip opinion list, the ruling number column (see R column) was filed in, which seems to be a reliable indicator based on past observances that there will be no more decisions forthcoming from the Supreme Court today.  So, once again, it seems as if the patent story of the day will be the one that never materialized.  The wait for a decision in the Bilski case continues.

The US Supreme Court did decide no fewer than 7 cases today, none of them styled Bilski v. Kappos.  The 7 decisions issued today were:

• Jefferson v. Upton
• United States v. Marcus
• Hardt v. Reliance Standard Life Ins. Co.
• United States v. O’Brien
• Lewis v. Chicago
• American Needle, Inc. v. National Football League

Today the United States Supreme Court issued four decisions, and none of them were Bilski v. Kappos.  The four decisions issued by the Court were:

Many had been pointing to May 17, 2010, as a likely day the Supreme Court would issue a decision, which was just speculation at best.  Regardless, it is now about 11:10 am, so it is fair to say that we are not going to get a decision today from the Supreme Court in Bilski v. Kappos. I have been monitoring the Supreme Court website this morning and another case has not been added to the slip opinions list since about 10:20 am, and at that time the decision numbers were filled in, showing that the last of the opinions for the day brings the total to 51 cases decided so far this term.

The Supreme Court held oral arguments in the Bilski case on November 9, 2009 (See Bilski Arguments Complete at the US Supreme Court and A Birds Eye View of the Bilski Oral Argument) and that means we have now been waiting 6 months and 8 days for a decision, and the wait continues.

What I refer to as the “pen and paper myth” has once again resurfaced on IPWatchdog.com in a comment.  The pen and paper myth goes like this: software should not be patentable because anything that can be done with pen and paper is not an invention and exclusive rights should not be given to any one person or entity.  Presumably the thought process here is that if you patent software you would prevent someone from engaging in the method using pen and paper.  Of course, that is not true, but why would a little thing like reality get in the way of making an otherwise absurd and provably incorrect statement?  Such provably wrong statements are rampant in the patent world today, particularly in light of what appears to be an all out media assault on technology and innovation that would make the persecutors of Galileo proud.

So just sit right back and I’ll tell a tale, a tale of a fateful trip, which if followed would result in far more than the wreckage of a tiny ship.  The tanking of the US economy is at stake, so take a sip of coffee, sugar up and stretch so you will be able to stay away and pay attention.  I know this is preaching to the choir for many, but for those who seemingly seek to remain clueless, if you actually pay attention you might learn something!

I almost can’t stand it any more. The anticipation is killing me! When will the United States Supreme Court issue its much anticipated decision in Bilski v. Kappos? One thing is for certain, it will be soon, but how soon? The Court term ends at the end of June, and it would be extraordinary for the Supreme Court to hold over a decision from one term to the next. It has happened in exceptionally rare circumstances in the past, typically when there were enormous Constitutional implications, such as in Marbury v. Madison and Brown v. Board of Education. While Bilski could be earth shattering in the patent world, it doesn’t even come close to Marbury or Brown, and there is absolutely no reason to anticipate the Court will hold over the decision. So that means the end of June at the latest, but I am guessing sooner, much sooner.  My prediction: April 21, 2010.

UPDATE: Still no decision as of May 17, 2010 – for more see
Another Day Without Bilski Decision, What Does It Mean?

When embarking on a software development project it is critical to understand that in order to both maximize the chance of obtaining a patent, as well as the likelihood of developing a working computer implemented process, you need to approach the task with an engineering mind set, as well as a healthy familiarity with Murphy’s Law.  Anything that can go wrong will go wrong, and once you release the process to end users a human element will complicate what should otherwise be a predictable, linear, machine driven response.  Embrace the uncertainty and challenges because the fact that software rarely, if ever, works like it should is what makes a working process patentable.

Earlier this week, on February 23, 2010, Facebook was granted US Patent No. 7,669,123, which covers a patent on a method for dynamically providing a news feed about a user of a social network. The patent application was filed on August 11, 2006, and claims priority from a string of provisional patent applications and nonprovisional patent applications, the earliest being a provisional patent application filed on December 14, 2005.

The Background of the patent explains that social networking websites have systems for tailoring connections between various users, allowing for frequent, automatic notification of changes in the information posted by other users. Apparently as of the time the patent application was filed there were existing mechanisms that allowed a user to display information about other users, including news items, but these news items were disparate and disorganized, thereby requiring users to spend time researching a news topic by searching for, identifying, and reading individual news items that are not presented in a coherent, consolidated manner. Thus, what was needed was an automatically generated display that contains information relevant to a user about another user of a social network. Essentially, it seems the resulting “invention” was a news feed for a social network. While this may have been new to social networking sites in December 2005 through August 2006, automatically updating news feeds were hardly new even then.

I am sure it will come as no great surprise to anyone who is a regular reader of IPWatchdog.com, but let me be as clear as I can be and put my bias right out in the open. I am a true believer in the patent system and I like the US approach to patentability, which is one where practically everything is patentable. There are, of course, some notable exceptions in the US. For example, you cannot patent something that is only capable of use for an illegal purpose, but if you get a rejection based on this it shows an acute lack of imagination. You don’t patent burglar tools, you patent locksmith tools! In any event, you also cannot patent an idea, laws of nature (such as E=mc², or the law of gravity), mathematical equations or things that are merely discovered. Pretty much anything else is fair game though, including software, business methods, living matter and pharmaceuticals. Given that patent watchers and software folks are becoming increasingly impatient waiting for a decision from the Supreme Court in Bilski, allow me to focus on software and business methods.

An article I published yesterday – Praying the Supremes Get Bilski Right in 2010 – has already started quite a stir, bringing out the anti-software patent advocates.  These folks always claim to be innovators and as innovators they know best and they state with an obviously flawed confidence that as innovators they can state with certainty that innovators despise software patents.  Of course, this is utter and complete nonsense.  Those who are anti-software patent are simply pro copying.  They don’t want software patents because then they cannot copy the work of others freely and without fear of being sued.  Those in the software industry who are not interested in software patents are not innovators, they are copiers.  They steal the work of others.  They also claim to have a sophisticated understanding of constitutional law and patent law, but reading what they say makes it apparent to anyone who is knowledgeable that they don’t know the first thing about law in general, let alone constitutional law or patent law in particular.  It serves no purpose to retroactively kill patents and applications that could have satisfied the standard announced in In re Bilski, but were written to satisfy the now defunct State Street test.  That is changing the rules in mid-stream and violates all ideals of fundamental fairness and due process.