Commentary

Go Ask Alice Part 1

Posted on November 21, 2014

Is your intellectual property eligible for a patent?
Hey, don’t ask me, go ask Alice

Last summer, patent law professionals were excited.  Really excited.  After many years of silence on the question of software and patents, the Supremes were about to speak.  We waited in bars and coffees shops around the planet, panting anxiously. (Well, probably we mostly waited at our desks; we have to work after all, but still, panting anxiously).  We thought we had tickets to a big show. A once in a lifetime event. She was called Alice, or Alice Corp. Pty. Ltd. v. CLS BANK INTERNATIONAL et al.(1)
After the Supreme Ct. decision came out, many talking (or mostly, blogging) heads weighed in.  Some said patents and patent law were dead.  Some said trolls were dead.  Some said software was now clearly patentable.

Most of us said “meh.”

Like Halley’s’ Comet, Alice was a lot smaller than we expected when she finally arrived.  In spite of the prognostication in thousands of patent law articles written beforehand, the patent case did not decide the big questions.  Perhaps in order to get the 9-0 unanimous opinion, the Court simply invalidated bad patents.  The opinion by Justice Thomas does nothing to clarify whether, and how, software is to be treated in the US patent system.
Alice sure created a lot of havoc on her way up the judicial ladder.  Lawyers like to say bad facts make bad law, and this one had some bad facts.  First off, the patents in Alice were owned by a “non practicing entity”.  You can take a look at that full color Lord of the Rings poster in your teenager’s bedroom (or, if you write software for a living, it might just be hanging right there in your living room) and in the corners you will see…trolls (well, Orcs, but bear with me).  So in one corner we have a troll with some patents written for an inventor who never ever made the claimed systems.  In the other corner we have the worlds’ big banks.  The defendants in Alice were big banks.
Then there were the patent claims.  In Alice, the invention was to methods for mitigating risk of non-performance by parties by using an intermediary in settling financial transactions.  Yup, it is an escrow account.  But in Alice, the claims included a computer (even claims that didn’t say so were interpreted to require one.)  The Alice patents don’t describe in any detail how the computer is used to implement the methods and there are no code segments or code appendices (often used in the early software patenting days but not commonly used today) to show how the computer actually performs the methods. There are many figures in the form of flow charts and “applications”- but no code. The representative claim has several steps but doesn’t use the words computer, processor, memory etc.  The steps as written could be done with a big notebook and a pencil, although in a practical system, not really.  However the patent specification makes it clear that a computer is to be used.
In part 2 of this discussion on Alice, we’ll review the twisting turns that led the case to the Supreme Court and the reaction from the patent law industry.

(1) The Supreme Court opinion issued June 19, 2014 is here:
http://www.supremecourt.gov/opinions/13pdf/13-298_7lh8.pdf

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