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08.18.11

Mike Masnick: More Software Patents Getting Rejected

Posted in Courtroom, Patents at 6:47 am by Dr. Roy Schestowitz

Mike Masnick
TechDirt’s Mike Masnick

Summary: Why the courtroom is tossing more software patents out and why the US political and patent systems are unlikely to just altogether forbid software patenting any time soon

EARLIER today, our reader Jose told us about this new analysis from Mike Masnick, who interprets the news we wrote about last night as meaning that software patents are weakened in the US system of courts. Quoting part of the blog post:

Well, this is getting interesting. Last year, when the Supreme Court ruled very narrowly in the Bilski case, without making any explicit statement (as precedent) on overall software or business model patents, many people were frustrated. Here was a situation where the Supreme Court could have drawn a much clearer map, but it declined to do so. Of course, we wondered if this would just mean that another case would have to make its way to the Supreme Court to get a clearer ruling on software patents. In effect, with Bilski, the Supreme Court basically said “this one test you use is fine, but it’s not the only test.” It didn’t say what those other tests should be, but basically left it up to the courts to decide. However, it did reject the specific Bilski patent for being an “abstract” idea, saying that this was not patentable under Section 101 of the Patent Act.

What’s been interesting is that this seems to have emboldened a few judges to apply new or different tests (with clear reasons and caselaw for why they do so)… and some of this is leading to more software patents getting rejected. In a new ruling at the Federal Circuit appeals court (CAFC), the court appears to open up a potentially broad path for rejecting all sorts of bad (mostly software) patents by deciding that the Supreme Court’s Bilski ruling might not have been so narrow after all.

We might be approaching the elimination of software patents. it is one thing for software patents to be approved by the USPTO (which makes money from it) but entirely another for those patents to withstand scrutiny from the defendant and the judge/jury. Of course it might take a while for silly SCOTUS to do what’s right for the population and not what’s good for very large corporations, but politicians too — not just the legal system — can make an impact. The problem is that the term “reform” got hijacked to mean the wrong reform that mostly benefits very large corporations, not the population. As one new article puts it:

According to Bernard Codd, an intellectual property partner with McDermott Will & Emery, the proposed “first to file” provision “would be a fundamental change to patent law.” The U.S. is among the only developed countries that clings to the “first to invent” system, he explained, which tends to inspire litigation over who actually invented a particular product or system. Under a first to file system, the first party to file is the presumed inventor, which creates what some refer to as a race to file.

Not everyone is happy about this likely change, with opponents claiming it unfairly favors large companies that can more easily afford the relatively expensive and complex process of filing patent applications. However, Codd thinks this characterization of the first to file system isn’t entirely accurate. Ultimately, he said, it means “you can’t afford to sit on ideas anymore,” regardless who you are, because if the guy across the street files first, you get nothing.

It might actually end up leveling the playing field for small businesses, according to him. Large companies often go through elongated processes when filing patent applications, Codd explained, and they’ll have to adapt to the new system. He added that there’s a tactic called the provisional patent application that should become a lot more popular. Codd thinks provisional applications will be a godsend for small inventors because they can draft and file a provisional application in a day and then have a year to undertake the laborious patent-application process.

Of course, this assessment comes from an “intellectual property” people, who is biased by the nature of his financial interests. They’re hijacking this debate, too. A few days ago we were approached by an analyst/researcher for a survey about Acacia (for its valuation). It turned out that he had only surveyed “intellectual property” people, who told him how wonderful and valuable Acacia was. As long as the legal system and political system are both run by people from law schools, we’re all deep in trouble.

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