Sunday, April 13, 2014

Patents on Business Processes, Methods and Software under scrutiny at the U.S. Supreme Court in Alice Corp. v. CLS Bank Int’l (13-298) March 31, 2014 Oral Arguments

One of the best ways to understand "law" in the making is to read United States Supreme Court oral arguments, such as the recent March 31, 2014 oral argument in the case of Alice Corp. v. CLS Bank Int’l (13-298).

We have selected, excerpted and commented what we regard to be some important points made in this case, in which a business process to be implemented by software is claimed quite independent of any software!

This is like some of the kind of "mischief" predicted by Justice Stevens in the aftermath of Bilski.

At issue here in Alice Corp. is the question whether that kind of patent claim is nothing more than the attempted patenting of "abstract ideas", which are, according to U.S. Supreme Court precedent, not patentable.


Is your software copyrighted?

MR. PHILLIPS [on behalf of petitioners]:

No, I don't believe so.


There is no special software that comes with this ­­ that's part of this patent, is it ­­ is there?


No. Justice Ginsburg, what we did here is what the Patent and Trademark Office encourages us to do and encourages all software patent writers to do, which is to identify the functions that you want to be provided for with the software and leave it then to the software writers, who I gather are, you know, quite capable of converting these functions into very specific code.



Mr. Perry ... you said to Justice Scalia if a patent sufficiently describes how a computer will implement an idea then it's patentable. So how sufficiently does one have to describe it? What do we want a judge to do at this threshold level in terms of trying to figure out whether the description is sufficient to get you past it?

MR. PERRY [on behalf of the respondents]:

First in the negative: What the applicant or patentee must do ­­ must not do is simply describe the desired result. That would take us back to State Street. That would simply say: I claim a magic box that buys high and sells low or vice versa, I suppose, I claim a magic box for investing. That's what these patents do.

Then to put it in the affirmative and in the language of Mayo, the claim has to recite something significantly more, something significantly more than the abstract idea itself. That would be a contextual analysis based on the claims and specifications and file history, and we know that some devices, some methods, some programming will pass that.

It is not going to be a bright­line rule and that's one of the tug­of­war issues that this Court and the Federal Circuit have been having in these cases. The Federal Circuit wants bright­line rules: All computers are in or all computers are out.

This Court has been more contextual. This Court has been more nuanced. This Court has looked at things in a more robust way.



The Federal Circuit in this case split in many ways, and it had our decisions to deal with. You said, given Bilski and Mayo, this is an easy case. What is the instruction that escaped a good number of judges on the Federal Circuit? How would you state the rule?


Your Honor, I think there's a significant element to the Federal Circuit that disagrees with Mayo and has been resistant in applying it."
Things are not helped along when Chief Justice Roberts is seemingly impressed by arrow-vectors in the patent documents:

"[It] constitutes the instructions about how to use the computer and where it needs to be affected. And just looking at it, it looks pretty complicated. There are a lot of arrows and they ­­-- you know, different things that go -- ­­(Laughter.) ... Well, but I mean, you know, it -- in different directions. And I understand him to say that in each of those places, that's where the computer is needed."
Was that all tongue-in-cheek? or merely more expectable "mischief", as predicted by Justice Stevens in Bilski?

We wrote in The United States Supreme Court Passes the Buck in the Bilski Patent Case : Business Methods are Patentable : Abstract Ideas are Unpatentable:
"[T]he Supreme Court denied Bilski's patent on the alternative ground that it was an "abstract idea", pursuant to the Supreme Court's earlier precedents, which hold that "laws of nature, physical phenomena, and abstract ideas" are not patentable subject matter. Just how the Court determined what an abstract idea is and what it is not not, is not clear from the opinion.

The majority refused to strike down Bilski's patent on the grounds that it was a business method, indicating instead that a patent-eligible "business method" might be patentable as a "process" within the meaning of the statute -- thus possibly opening up a new Pandora's Box for the patent world, much to the consternation of Justice Stevens, concurring in judgment,
who wrote:
"The Court correctly holds that the machine-or-transformation test is not the sole test for what constitutes a patentable process; rather, it is a critical clue. [footnote 1] But the Court is quite wrong, in my view, to suggest that any series of steps that is not itself an abstract idea or law of nature may constitute a “process” within the meaning of §101. The language in the Court’s opinion to this effect can only cause mischief." [emphasis added by LawPundit]"
Small wonder that much of intellectual property law continues to remain in such a needless mess, nor is the ultimate decision in Alice Corp. going to help us much, as the Court in oral argument indicated that it will not be knocking down patents for business methods or processes or for software patents.

It will most certainly not be adopting the impossible standard suggested by the United States government as amicus curiae:
"GENERAL VERRILLI [on behalf of the United States]:

An abstract idea does not become patent­ eligible merely by tacking on an instruction to use a computer to carry it out. A computer makes a difference under Section 101 when it imposes a meaningful limit on the patent claim. That occurs when the claim is directed at improvement in computing technology or an innovation that uses computing technology to improve other technological functions. That's the test that we believe is most faithful to this Court's precedents in Bilski and Mayo."
How could the U.S. government suggest the adoption of such a complex, inappropriate standard? In any case, a definition of patent eligibility tied in ANY way to "a computer" seems to us to be unjustified.

"Software" is nothing other than strings of characters that contain (ultimately) machine-readable instructions for machines that we specifically call computers, printers, keyboards, handhelds, etc., but machines nonetheless.

All software is merely specialized TEXT characters, organized in a given manner, and such instructions should never have been seen as being patentable subject matter. The fact that computers can read that text FASTER and can implement such instructions FASTER is NOT an invention.

At best, if at all protected by IP law, then such protection of the actual software code should only be by copyrights.

TEXT, in the general history of law and legal thinking, is not "an invention".

An "invention" can only be WHAT something does by virtue of text character software code commands that it receives.

For purposes of patentability, an actual working "something" should have to exist (whether as a machine or as a software program) and do what the invention says it does in its unique way, and only that unique way as embodied in that particular invention should be patentable, unless it is not novel and/or obvious to anyone in the state of the art, and not anticipated by prior art (which most "inventions" in fact are).

By no means should "non-built" machines and "non-written" software be able to claim broad swathes of monopolistic patent protection on the promise that a working "something" is in the offing. Talk about "abstract ideas"!

Moreover, whether a "machine" involved is a computer or simply a new-fangled toaster should make no difference, if e.g. a new way to "pop up" the bread has been invented.

The distinction between computers and "other" machines is thus in error. All machines need commands viz. operators. That is no invention.

Similarly erroneous are suggestions from the direction of the Federal Circuit that one should separate off chosen areas in "biological sciences" from other areas of "invention", as if different rules applied.

[F]ormer Chief Judge Michelle filed a brief in this Court essentially saying Mayo is a life­sciences case, You should limit it to that because if you apply it to everything else, then these patents are no good. 

Mayo we submit is a technology-­neutral, industry-­neutral, exception­neutral framework that can be used to answer all of these questions."

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