US Supreme Court Invalidates Patent For Being Software Patent

ciaran_o_riordan (662132) writes The US Supreme Court has just invalidated a patent for being a software patent! To no fanfare, the Court has spent the past months reviewing a case, Alice v. CLS Bank, which posed the question of "Whether claims to computer-implemented inventions ... are directed to patent-eligible subject matter." Their ruling was just published, and what we can say already is that the court was unanimous in finding this particular software patent invalid, saying: "the method claims, which merely require generic computer implementation, fail to transform that abstract idea into a patent-eligible invention," and go on to conclude that because "petitioner's system and media claims add nothing of substance to the underlying abstract idea, we hold that they too are patent ineligible." The End Software Patents wiki has a page for commenting the key extracts and listing third-party analyses. Analysis will appear there as the day(s) goes on. Careful reading is needed to get an idea of what is clearly invalidated (file formats?), and what areas are left for future rulings. If you can help, well, it's a wiki. Software Freedom Law Center's website will also be worth checking in the near future.

Comments

Oh please please please

[gumbright]

Please let this lead somewhere good.

I'm really missing Groklaw

[DrJimbo]

We need someone who is familiar with the law to explain this to us techies. PJ we need you!

Re:I'm really missing Groklaw

[Warhawke]

This ruling extends the basic rule of Bilski that you can't patent an idea to the computer. Essentially, Alice Corp. states that you can't patent a general idea simply by appending the term "on a computer." What the case doesn't say is that all software patents are invalidated. Rather, the software has to be more than just a generic business idea expressed "on a computer."

Alice Corp. was the assignee of several patents for mitigating "settlement risk" via software. Software claims in patent law usually occur in two parts: a method of performing the claimed function and a system for performing the prior claimed method. This basically lets a patent holder guard against people manipulating their way around the system or method claims to perform the exact same function, such as by using a remote server instead of a local hard drive, or querying before step A as opposed to after step A. Alice Corp. had both a system and method patent for mitigating settlement risk. Specifically, the claim contemplated two parties using a third-party intermediary, in this case a computer, to create account ledgers (or "shadow accounts," as the patent called them) based on the accounts of both primary parties, determining available versus unavailable funds, calculating a risk for a given set of transactions, and then issuing instructions to the parties telling them what transactions are permitted and what transactions are too risky to engage in.

The patent itself was to "facilitate the exchange of financial obligations between two parties by using a computer system as a third-party intermediary." If this sounds like an abstract business method, that's because it is. Alice Corp.'s patent was basically a claim to mitigating settlement risk by employing a third party on a computer. The intermediary was just the computer in this case. The district court found that the patent was too vague, because it really only contemplated an idea. The Federal Court on first hearing reversed, saying that it wasn't "manifestly evident" that the patent ideas were abstract, so the case should be litigated rather than dismissed on summary judgment. On second hearing en banc (i.e. with all the Federal Circuit judges present, the Federal Circuit changed its position and determined that the method claims were invalid. There was some internal dispute, however, as to whether the system claims -- i.e. a claim over a computer that performs the function -- was valid.

The Supreme Court determined, in an opinion written by Justice Thomas, that both the method and system claims were abstract and therefore invalid. The rule under a cased called Mayo Collaborative Services v. Promethius Labs requires that an abstract idea, to be patentable, must have some practically beneficial application to either the computer system implementing it or to some other kind of technology. For example, it might be common knowledge that plucking a guitar string emanates a harmonic frequency, so I can't patent plucking a guitar string, but if I find a new, beneficial use for plucking a guitar string, such as a patent on plucking guitar strings to encourage the growth and development of plants (yes, it's nonsensical -- I can't invent good, patentable things on the spot!), then I could patent that. Here, though, the court asked "whether the claims at issue here do more than simply instruct the practitioner to implement the abstract idea of intermediated settlement in a generic computer." Laconically, the Court concluded, "They do not."

So what does this mean for software patents? Well they still are valid as more than just math. Though the Court didn't address the issue directly, it has been generally held that software is sufficiently transformative to warrant patentability. While not a favorite opinion here on Slashdot, that's not altogether nonsensical; if software is sufficiently artistic enough to be copyrightable, then it stands to reason that it has been sufficiently transformed from some

Shock and Awe

[Carcass666]

A unanimous decision, authored by the most conservative voice on the court (Thomas) with a concurring opinion by one of the most liberal (Sotomayor). If this were the beginning of April, I would say this story was a prank. Yeah, it doesn't completely kill software patents, but it does seem to mortally wound the "business process + software = patent troll profit" problem that is plaguing software development. This is a good day for the judicial branch. It's a good day for the USA.

You've got ESP

[ciaran_o_riordan]

Sorry, all you've got is me.

If anyone can help, I've been building this wiki for five years now without a break:

http://en.swpat.org/

(And I'm working on campaigns against software patents since 2003.)

Re:WTF

[ShanghaiBill]

the court was unanimous

How did that happen?

Most Supreme Court decisions are unanimous. In the last term, 52% of decisions were 9-0. Another 12% were 8-1.

Summary of decision

[Impy the Impiuos Imp]

A summary of the decision:

1. [We have long held that] Laws of nature, natural phenomena, and abstract ideas are “the basic tools of scientific and technological work.” and are not patentable.

2. Restricting such an idea and applying it in a particular domain also is not patentable, long established.

3. This is an abstract idea -- and a well-known one in your industry at that.

4. Applying it "on a computer" is trying to patent it in a restricted domain, and thus not patentable.

5. quo novus ordo et tu Brute seclorum GT 9-0 FO