The U.S. Supreme Court delivered its much-anticipated decision in the case of Alice v. CLS today. The case involved an Australian company attempting to enforce patents on software managing risk mitigation in financial transactions; CLS Bank sought a court ruling that the patents were not enforceable. The first court ruled Alice's patents invalid; the Federal Circuit Appeals court reversed that decision; and then the same court, in an en banc hearing, re-ruled that the patents were invalid. The Supreme Court today upheld that ruling.
This is great news for America's software industry: It's become much harder to prove a software patent is valid. In affirming the lower court's en banc decision, the Supreme Court confirmed its previously devised approach to such matters. It divided the problem into two parts:
- Is there something Alice is doing that would be patentable without a computer being involved?
- Does the involvement of a computer transform anything into a patentable subject?
In this case, the answer to both questions was no. While, characteristically, the court has avoided straying into larger matters (such as the general applicability of software patents), What it did say helps tremendously. First, the court said:
Merely requiring generic computer implementation fails to transform that abstract idea into a patent-eligible invention.
In other words, just slapping a phrase like "a computer that ..." in front of something that's not patentable does not magically make it patentable. Secondly, the court said that making it sound all technical is not a magical talisman unlocking patentability:
But what petitioner characterizes as specific hardware -- a "data processing system" with a " communications controller" and "data storage unit," for example -- is purely functional and generic. Nearly every computer will include a "communications controller" and "data storage unit" capable of performing the basic calculation.
Nor does it help to make the abstract technique sound more fancy by framing it as "mathematical":
One of the claims in Bilski reduced hedging to a mathematical formula, but the Court did not assign any special significance to that fact, much less the sort of talismanic significance petitioner claims.
Nor does asserting that because a computer is "a physical thing" propel a patent into validity:
The fact that a computer "necessarily exists in the physical, rather than purely conceptual, realm," is beside the point. There is no dispute that a computer is a tangible system, or that many computer-implemented claims are formally addressed to patent-eligible subject matter. But if that were the end of the inquiry, an applicant could claim any principle of the physical or social sciences by reciting a computer system configured to implement the relevant concept.
Hammering the point home, the court said:
The mere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention. Stating an abstract idea "while adding the words 'apply it'" is not enough for patent eligibility.
While this is just what many had hoped for, it doesn't make things immediately better. The prevalence of invalid software patents from the past actions of USPTO means the shakedowns will continue for the foreseeable future. More than that, the question of whether software should simply be unpatentable wasn't really necessary for the court to address, so the matter remains an open question for a future case.
But it will improve the balance of outcomes for those rich enough to defend themselves against patent aggression. It's a step in the right direction, one that many in the software industry will cheer with the enthusiasm of a soccer crowd supporting a goal by the home team.
This story, "Supreme Court strikes a serious blow against software patents," was originally published at InfoWorld.com. Get the first word on what the important tech news really means with the InfoWorld Tech Watch blog. For the latest developments in business technology news, follow InfoWorld.com on Twitter.