U.S. Supreme Courts Rules Against Software-Based Business Method Patent

On June 19, 2014 The United State Supreme Court handed down its ruling in the case of Alice Corporate Pty. LTD, v. CLS Bank International, a long anticipated case dealing with the viability of so-called “business process” or “business method” patents, even when that process is implemented with the assistance of a computer. In an opinion written by Justice Clarence Thomas, the Court, in a unanimous decision, ruled that where “[a] method claim does no more than simply instruct the practitioner to implement [an] abstract idea… on a generic computer… [it] is not ‘enough’ to transform the abstract idea into a patent-eligible invention.”

The Alice Corporation case centered around the patentability of a method for reducing risk that the parties to a financial transaction will not pay what they owe, making use of a computer based implementation of the methodology. Alice Corporation had argued in the case that, because the the process “required a substantial and meaningful role for the computer” that the process whet beyond being a mere abstract idea. Justice Thomas’ opinion, however, clearly declared that use of a computer added nothing to the abstract idea, and thus the process in question was non-patentable.

This Alice Corporation follows in the steps of the Supreme Court’s 2010 ruling Bilski v. Kappos, in which the Court that a method for hedging risk was “a fundamental economic practice long prevalent in out system of commerce” and that it was, in nature, an abstract idea and, thus, not subject to being patented.  In his opinion in Alice Corporation, Justice Thomas drew a parallel to the Bilski case, stating clearly that both kinds of processes are squarely within the realms of abstract ideas.

It is clear that this case, along with Bilski and the 2012 case of Mayo Collaborative Services v. Prometheus labs, will be thoroughly scoured by technology companies in an attempt to triangulate the point at which specific technology products implementing processes can become eligible for patent protection. While the precise line or demarcation for this is by no means clear yet, it is clear that the Supreme Court is setting and increasingly high bar, ostensibly in the hope of avoiding he creation of unreasonable bars to continued technological innovation.

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When is software patentable? The Supreme Court is about to weigh in

The Alice Corp. case definitely represents a potential pivot point for software patents. The determination of what what is and abstract idea and what is not in the context of computer software has long been a difficult and fuzzy process. It is hoped that the U.S. Supreme Court will use its decision in the Alice Corp. case to clarify that analysis, thus providing clearer direction to software authors who are considering whether to seek patent protection for their creations.

Gigaom

Software patents have always been controversial, in large part because the dividing line between a patentable software-based invention and one that is not has never been clearly defined. But the often hazy body of law that determines software patentability could be about to change.

On March 31, the U.S. Supreme Court will hear oral arguments in Alice Corp. Pty. Ltd. v. CLS Bank Int’l., No. 13-298, a case that could have wide consequences in the tech community and beyond.  At stake is when and how a particular software-based invention—that is, an invention that incorporates the performance of a computer and software—is entitled to a patent.

At the heart of the matter is the “abstract idea.” An abstract idea on its own is not patentable, but what exactly counts as an abstract idea? The Supreme Court has never set out a specific test for what is and is not…

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New bipartisan bill could squash the widely-hated patent troll industry for good | The Verge

New bipartisan bill could squash the widely-hated patent troll industry for good | The Verge.

It appears that today U.S. Representative Bob Goodlatte of Virginia introduced a piece of legislation to broad bi-partisan support which is aimed squarely at cutting down on the number of frivolous and abusive patent suits which are roiling the technology industry.

 

The proposed legislation would  institute a “loser pays” system for attorneys’ fee awards, would delay burdensome discovery requests until the court has first interpreted the disputed patent, and would increase transparency of patent ownership (curtailing patent troll’s favored M.O. of using multiple shell companies to hide behind and/or use a fronts in patent litigation).

 

This proposed litigation, while not necessarily a panacea for the the intelelctual property problems currently facing companies in the technology industry, would certainly go a long way to curb some of the more egregious and abusive tactics currently being utilized by non-practicing entities (a/k/a patent trolls).

 

It will be interesting to see if this bill will actually be passed into law. Here’s to hoping!

Fair use? US stamp featuring photo of monument nets sculptor $650,000: Digital Photography Review

Fair use? US stamp featuring photo of monument nets sculptor $650,000: Digital Photography Review.

In an interesting case involving a postage stamp depicting a photograph of the Korean War Veterans Memorial, the U.S. Postal Service has been found to have infringed upon the copyrights of the sculptor who created the Memorial. It appears that at the time the memorial was commissioned, that the government did not secure copyrights to the statute, which by default remained with the sculptor.

Subsequently the U.S.P.S. made use of a photograph of the memorial on a postage stamp. When sued by the sculptor for copyright infringement, the U.S.P.S. unsuccessfully argued that their use was “fair use”, and accepted defense to copyright infringement. Ultimately the federal court determined that the Postal Service’s use of the intellectual property did not fall within the definitions of fair use, and after much pushing and pulling byt he respective sides, the U.S. Court of Federal Claims as found that the U.S.P.S. owes the sculptor $684,844.94 in damages for its infringement of his copyrights.

This case highlights the complexity of the application of intellectual property law and the high stakes involved in failing to secure the appropriate rights to use intellectual property in a particular way.

Patent troll Lodsys demands $5,000 from Martha Stewart. That was a bad idea — Tech News and Analysis

Patent troll Lodsys demands $5,000 from Martha Stewart. That was a bad idea — Tech News and Analysis.

It appears that Martha is ready to throw down with notorious patent troll Lodsys. Martha Stewart Living Omnimedia has filed for declaratory judgment against the troll, seeking a ruling which not only finds MSLO’s electronic magazines to not infringe upon Lodsys’ patents, but that the patents themselves are invalid.

On hearing about this, I immediately thought of the line from the cult classic film “The Princess Bride”, in which the villain declares: “You just made the second classic blunder! This first, of course, is never become involved in a land war in Asia. But only slightly less well know: ‘Never go head to head with [Martha Stewart]…’ “

Downloading Is Mean! Content Industry Drafts Anti-Piracy Curriculum for Elementary Schools | Threat Level | Wired.com

Downloading Is Mean! Content Industry Drafts Anti-Piracy Curriculum for Elementary Schools | Threat Level | Wired.com.

Interesting article. While I certainly think it is good to teach children about intellectual property, what it is, and what the law has to say about it, I, personally, am not very comfortable with the idea of particular industries writing pro-industry curricula for our schools.

This begs the question (without answering it), of “where should the line be drawn in public / private partnerships, particularly when it comes to childhood education?”

A new(ish) tactic: Patent trolls want $1,000—for using scanners | Ars Technica

Patent trolls want $1,000—for using scanners | Ars Technica.

A disturbing new trend is emerging in the world of patent litigation. Non-Participating Entities (“NPEs” or, more colloquially, “Patent Trolls”) have now started threatening, and in some cases suing end-users of technology which the NPEs are claiming infringes upon patents they now own.

In the ArsTechnica article above, you can read the tale of an Atlanta-based IT services company, BlueWave, who recently tangles with such a troll. In this instance, the NPE, through a law firm, was seeking to “settle” an infringement claim against BlueWave for making use of scanners to create .pdf documents from hard copies and then e-mailing and otherwise distributing the .pdf files (as just about every business in this country now does). Of course, it sounds ridiculous on its face that this could be a violation a valid patent, and yet, there do exist several patents which claims to cover this series of processes.

While it is probable that these patents (and many like them) are vulnerable to attack, NPEs are increasingly making use of such patents to press for settlements from companies who they believe are unlikely to go the time and expenses of fighting off such claims (or seeking to invalidate the underlying patents). In some cases, the NPEs are even filing suit, in hopes that by increasing the pressure on the alleged infringer, that a settlement will result.

Technically, there is nothing illegal about such tactics. At the same time they reek of bad faith and dubious business practices. At a minimum, they certainly represent a perverion of the intent behind our intellectual property system.

Legitimate or illegitimate  though, we can expect to see much more of this kind of behavior.