Software Inventions See More Help in Bascom Decision

Since the Supreme Court decided Alice Corp. v. CLS Bank International, patent examiners and the courts have been working to better define patent eligibility. Following closely on the heels of their Enfish, LLC, v. Microsoft Corporation decision, the Federal Circuit provides more guidance on whether software qualified as patentable subject matter with Bascom Global Internet Services, Inc., v. AT&T Mobility LLC. Taken together, Enfish and Bascom indicate the future for software patents is not nearly as bleak as originally predicted when Alice was decided.

Bascom reiterated the two-step test – asking first if the patent is directed to patent- ineligible content and, if so, then asking whether additional elements transform the nature of the claim into a patent-eligible application. The Federal Circuit determined that Bascom was indeed directed to patent-ineligible content. However, on the second step, the court decided that the claims included an inventive concept that can be found in the “non-conventional and non-generic arrangement of known, conventional pieces” transforming the nature of the claims into a patent-eligible application.

The claims in this case were directed to filtering Internet content. The prior art taught two different types of filtering possible at either a local device or on a server. While these types of filtering were known, the system in Bascom enabled the personalized filtering seen on a local device to be performed on a server. By reciting specific details of where the filtering was performed, Bascom was determined to cover a specific, discrete implementation and thus not “preempt all ways of filtering content”. Accordingly, this new arrangement was sufficient for the court to find the claims patent-eligible.

Procedurally, this case was decided on a motion to dismiss during the earliest stages of the case, even before discovery or claim construction. As such, the Federal Circuit construed the facts in favor of Bascom when making their decision to uphold the validity of the patent at this time. In contrast, a recent trend in patent-eligibility decisions has developed where patents are found invalid at the onset of the case. While this trend has been heralded as an efficient means to dispense with dubious claims by ‘patent trolls’ in order to avoid the costs of litigation, it has also been criticized for sidestepping important patent analysis which could help answer the patent-eligibility questions.

The courts are beginning to establish a fuller picture of what qualifies as patent-eligible subject matter in the wake of Alice. Bascom continues with this trend by providing advice with particular relevance for software applications. This helps give inventors and their attorneys the tools they need to draft acceptable claims in order to receive the appropriate examination by the United State Patent and Trademark Office and the proper deference in the courts for the patents that will ultimately issue.

Is Your Software Invention Eligible for Patent Protection?

Under the patent laws, “Whoever invents or discovers any new or useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor…” While the statement of the law appears clear, its application to inventions embodied in software is anything but straightforward. 

Patent practitioners and clients alike have long sought clarification of when methods and systems embodied in software would be considered patent eligible, and when such methods will be viewed as directed to non-statutory subject matter for which patent protection is not available. It was hoped that an eagerly awaited Supreme Court decision in Alice Corp. Pty. Ltd. v. CLS Bank International, et al. (Alice Corp.) would provide such clarification. It did not.

           

What constitutes an “abstract idea?”

Though the statutory language that defines patent-eligibility is extremely broad, the courts have held that abstract ideas are one of the “basic tools of scientific and technological work” and that [M]onopolization of those tools through the grant of a patent might tend to impede innovation more than it would tend to promote it.” The courts have held that abstract ideas are fundamental truths that are “part of the storehouse of knowledge of all men … free to all men and reserved exclusively to none.”

Without ever clearly defining what an abstract idea might be, in a string of cases leading up to the Alice Corp. decision, the courts concluded that various processes and systems that were implemented in software were directed to an “abstract idea” and thus, constituted patent-ineligible subject matter. 

While recognizing that computer implemented inventions are patent eligible just like any other machines and, that once programmed, a computer is a special purpose device just like any other machine, the courts have struggled with computer implemented inventions where the invention involves some form of calculations, the display of a result and data manipulation within a computer without more tangible results that extend beyond the execution of the computer software. 

The boundaries of patent-eligibility with respect to inventions embodied in computer software have remained unclear and decisions of the courts have been difficult to reconcile. Furthermore, while holding that computer related inventions that embody an abstract idea are patent ineligible, the courts have never clearly defined what constitutes an abstract idea.   

How is patent eligibility determined?

           

The Supreme Court in Alice Corp. stated that a two part test should be employed to ascertain whether claims are directed to patent-eligible subject matter.  First, a determination must be made as to whether the claims are directed to an “abstract idea.”  If the claims are directed to an abstract idea, an examination must next be undertaken to ascertain whether the claims contain an “inventive concept” sufficient to “transform” the claimed abstract idea into a patent-eligible application. 

The application of this test, however, in practice, is problematic. In the recent cases the courts have looked at the patent claim in question and distilled it into an “abstract idea.”  In this exercise, however, the courts have often ignored specific claim limitations and have focused on a high level objective of the claim, even if the patent claim could not be asserted at the level of breadth of the courts abstraction. In short, the conclusions reached by the courts regarding abstractness at times appear subjective and arbitrary.

In the Alice Corp. case, the Supreme Court stated that the involved claims were “abstract” because they were similar to claims considered in a prior case decided by the Court. Such logic provides little guidance to a practitioner that is attempting to assess whether a specific subject would be viewed as “abstract” if not directly analogous to subject matter previously considered by a court. 

Under the second part of the two part test discussed by the Alice Court, one must examine the claim to determine whether it contains an “inventive concept” sufficient to “transform” the claimed abstract idea into a patent-eligible application. The Court stated that this process requires more than simply stating the abstract idea while adding the words “apply it.”  However, the Court never defined what type of “transformation” would establish a qualifying “inventive concept” under the stated test.  A review of recent cases suggests that the second part of the two part test is more akin to a test based on obviousness rather than one directed at patent eligibility under the patent laws. 

Key takeaways

The Court intentionally did not enunciate a rule that precluded patentability of inventions embodied in software, but left the boundaries of patent eligibility ill-defined. Nonetheless, there are several takeaways from the Alice Corp. decision: 

1. Inventions that are solely embodied in software and simply display an output, manipulate data, or involve a calculation may be viewed as patent-ineligible. However, even in this category, prior cases would suggest that there are exceptions.

2. An invention claimed as a series of steps performed by computer software that are conventional steps recited at a high level of generality or well-known steps are not likely to be viewed as providing an “inventive concept” and thus, are likely to be held to be patent ineligible.

 

3. When an invention is embodied in computer software, one must be able to clearly articulate an “inventive concept.” Patent eligibility will not rest solely on the use of a computer to implement an otherwise known method or facilitate the operation of an otherwise known system. The software must do something other than what software running on a general purpose computer is known to do. 

4. Finally, if a claim is directed to subject matter that is viewed as being “abstract,” the claim will not be patent-eligible simply because it is limited to a particular technological field or application.

As with any inventions for which patentability is uncertain, one must weigh the potential value of obtaining patent protection and the attendant costs associated with such efforts against the risk that patent protection may be unavailable. For inventions that are embodied solely in software, the “clarifications” provided by Supreme Court in the Alice Corp. decision offer little new guidance to the practitioner and client as to the boundaries of patent eligibility.

As with many such issues, a determination regarding patent-eligibility is highly fact dependent. The details regarding the specific software system for which patent protection is desired in many cases permit a more informed view regarding patent-eligibility.