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11.04.08

Experts Indicate That re Bilski Does Impact Software Patents

Posted in America, Courtroom, Law, Patents at 8:43 am by Dr. Roy Schestowitz

Gavel
Case closed, now what does this mean?

ONE question that has been asked regularly since the ruling was announced is: what impact — if any — does this have on software patents? According to extensive reading, it seems more or less agreed upon that software patents are affected too, but only to an extent.

For future reference, in addition to our older posts about the re Bilski decision [1, 2, 3, 4, 5, 6], here are many more: [mostly via Digital Majority, which is an excellent resource]

1. In regards to In re Bilski

On the key question of when information becomes a machine, the ruling does provide some clues: “First, [...] the use of a specific machine or transformation of an article must impose meaningful limits on the claim’s scope to impart patent-eligibility. [...] Second, the involvement of the machine or transformation in the claimed process must not merely be insignificant extra-solution activity.” For more on extra-solution activity, have a look at my law review article (PDF) that focuses heavily on the idea.

2. Reactions to the Bilski decision begin to roll in

Not being a US patent attorney and not possessing any expertise in US patent law, I am not in a position to comment on the CAFC’s Bilski decision handed down yesterday. However, I do know a few people who are, so I have been in touch with them to get their reactions. Below is what I have had so far. I will continue to add to these until the beginning of next week (3rd/4th November will be the cut-off).

3. US court narrows scope for business method patents

“While looking for ‘a useful, concrete and tangible result’ may in many instances provide useful indications of whether a claim is drawn to a fundamental principle or a practical application of such a principle, that inquiry is insufficient to determine whether a claim is patent-eligible,” it said.

4. Bilski: Almost the Big One

The big question is what effect, if any, this decision will have on the current referral of a “point of law” concerning software patents by the President of the European Patent Office (EPO) to the EPO “Enlarged Board of Appeal”, something I wrote about earlier this week. It would be ironic if, at a time when the US courts begin to move away from patenting software “as such”, the EPO started allowing precisely that through a relaxation of its own rules.

5. So are software patents dead or not?

My opinion is that it’s going to get harder and harder to patent anything. Of course there will be a big push back from business, so this won’t happen over night, but I think the concept of patents will eventually disappear entirely.

6. US Court Throws Out Most Software Patents

The IT Examiner also observes that “Microsoft has a problem” and that “Much of the patent portfolio of some of the world’s biggest software companies has become worthless overnight, thanks to a ruling yesterday by the US patent court.”

7. Court Reshapes Patent Reform Debate

In a ruling with huge implications for the technology sector, the U.S. Court of Appeals for the Federal Circuit said Oct. 30 pure software or business method patents that are neither tied to a specific machine nor change something into a different state are not patentable.

8. In Huge Shift, Court Ruling Effectively Denies Software-Only Patent Rights

The case originally centered on a patent for “a method of managing the risk of bad weather through commodities trading”—which falls more under the “business process” bucket, but the same ruling effectively makes patenting a specific software process impossible. The previous ruling allowed such patents, so long as computers were involved and the process produced a “useful, concrete, and tangible result.” This ruling rejects that premise, favoring instead an older test that only allows patents for things involving an actual machine or a transformation of a tangible object into a different state.

9. Professor Collins: In re Bilski: Tangibility Gone “Meta”

Although they are both legitimate questions, this short comment addresses neither whether there is a legitimate statutory basis for this test nor whether Supreme Court precedent should be interpreted so as to mandate (or even support) this test. Rather, it focuses solely on the criteria that the court offers to draw the line between patentable and unpatentable transformations. The Federal Circuit has added a new twist to the tangibility test that has for many years played a role in determining patent-eligibility: the tangibility test has gone “meta.” The tangibility of the formal data that is actually transformed by a method of processing information is not relevant to patent-eligibility, but the tangibility of the things that the data is about—the tangibility of the informational content of the data or the things to which the data refers—now appears to be dispositive.

10. Bilski: What It Means, Part 1 — Red Hat on What It Means for FOSS

means to everyone: You can’t get patents any more on a pure mental process. You can no longer patent a process that you can think through all in your mind. In other words, abstract ideas are not patentable. There has to be either a particular machine or a transformation in the process. So pure “ideas” or “mental processes” are over. That means most business methods patents are no longer valid because they are outside the parameters of what is eligible for patenting. In simple terms, it means this:

The End for the stupidest of the stupid patents.

Yay! It means that the tide is turning. There could still be an appeal of Bilski, and even without one, there are ways to chip away at this decision’s new standard for patentability, to try to get over the new turnstile, so to speak, and strategies on how to do that have begun already. I’ve spent the days since the decision issued researching for you, so I can explain Bilski to you. There is too much material for just one article. So, I’ll break it up into parts. My purpose is to make sure you understand fully, so you can be helpful with your ideas and so you can explain this issue to others, so they understand what is involved for FOSS. If there are parts you don’t understand, ask. If I don’t know the answer, I can ask someone.

11. US patent ruling bodes well for tech

The case in question was rejected because the patent at issue was a process not tied to a “machine”, which is one standard for patentability.

[...]

“The standard articulated in this case should limit the outrageous business method and software patents that we have recently seen, without undermining the incentive to innovate in these areas.”

12. In re Bilski and the future of business method patents

Duffy stressed that the patent at issue in State Street, the 1998 decision that gave the OK to software and business method patents, would be fine and dandy under the new test—it’s just the test itself that changed. The court maintained the “core holding” of State Street, said Duffy, merely changing the “verbal formulation” required. (And the number of BM patents that will still be strong?—Many! Most! Almost all!)

13. CLE: How to Draft Software Claims under Bilski

Going forward, I do not believe that these limitations will have a significant impact on a skilled practitioner’s ability to patent software innovations.

14. Patent Court: You Can No Longer Patent Thin Air

In essence, the ruling means that business ideas in and of themselves aren’t patentable. In addition to Amazon’s “one-click” patent, which is the concept of purchasing something via credit card by just clicking a single website link, Friendster’s patents on social networking also come to mind as being unpatentable based on this judgement. That patent covers a “system, method and apparatus for connecting users in an online computer system based on their relationships within social networks” and a “method of inducing content uploads in a social network,” amongst other claims.

15. Federal Circuit Enforces Limit on Business Method Patents

The result: While the court did not categorically exclude business method patents, it held fast the idea that any method, whether business-related or not, must be tethered to a machine or some sort of physical transformation, says Stephen Maebius, a partner at Foley & Lardner.

16. Court limits ‘business method’ patents

The Stop Software Patents initiative has found a new video from the German television where the subject of sofwtare patents is covered.

German television 3sat has a reportage about software patents. A german programmer highlights that software patents ruin investment in software development.

Here is another new item which discusses both BM patents and SW patents, the context being patents relating to a marriage portal.

“The best way to prepare to be a programmer is to write programs and to study great programs that other people have written.”

Bill Gates, Free software advocate???

“Thanks to Mr. Gates, we now know that an open Internet with protocols anyone can implement is communism; it was set up by that famous communist agent, the US Department of Defense.”

Richard Stallman

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2 Comments

  1. Robert Millan said,

    November 5, 2008 at 4:19 am

    Gravatar

    So is this reflecting in the stock market? We all know there’s a huge economic bubble around the patent hype. Could this be the detonator that bursts it?

  2. Roy Schestowitz said,

    November 5, 2008 at 4:31 am

    Gravatar

    Glyn wrote this yesterday:

    “Er, because banks never make mistakes, and are never motivated by blind greed? “A pretty positive sign”? I don’t think so….”

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