The following is a student written article on an upcoming Supreme Court case – Alice Corporation Pty. Ltd. v. CLS Bank International. The SCOTUSBlog page for the case can be found here. Oral argument is scheduled for March 31, 2014.
Author: C. Dylan Turner, email@example.com, Northwestern Law J.D. 2015
Amici have been pouring in recently in anticipation of oral arguments before the Supreme Court in Alice Corp. Pty. Ltd. v. CLS Bank Intern, scheduled to take place on March 31st. The stakes are high; the sundry decisions of Federal Circuit judges suggested that recent rulings from the Supreme Court, including Bilski v. Kappos, have put the patentability of some software at risk. The Federal Circuit’s en banc court agreed that Alice’s claims to “the management of risk relating to specified, yet unknown, future events” were invalid. This is because the Court’s rulings show that an abstract idea, implemented with no more than “insignificant postsolution activity,” is not patentable subject matter under 35 U.S.C. § 101.
One such amicus brief was filed jointly by giants of the technology sector including Google, Facebook, and Amazon.com. The brief’s opening statement reveals these companies’ stance on the issue: “Patents that merely claim abstract ideas implemented on computers or over the Internet are invalid under 35 U.S.C. § 101.” Their position is unambiguously against patentability of vague software patents. “[R]igorous and timely application of this Court’s Section 101 jurisprudence is especially important in this context because abstract software patents have become a plague on computer-related industries,” they claim.
Doctrinally, the brief draws heavily on the Court’s recent decisions, arguing that the Court’s decision in Mayo v. Prometheus applies to all areas of technology. Following the Court’s recent precedent, the companies call for an inventive step on top of an abstract idea. As for Alice’s claims to systems for carrying out risk-hedging methods, the companies argue that the claims do not reveal a specific manner of implementing the methods because how a computer carries out the method is not specified. Implementing the methods would not require a novel or complex program, and only ordinary programming knowledge would be necessary to do so. The claims are merely abstract ideas in a specific technological environment, the companies argue.
The companies also note the Federal Circuit’s reluctance to respect the Court’s decisions concerning § 101. They argue that subject matter eligibility would be eviscerated by allowing clever drafting to evade its requirements. Further, the “new and useful” requirement means that the Court’s insistence on an inventive concept is warranted by statute. Anticipation and nonobviousness requirements are insufficient to screen abstract idea patents, because, as pointed out in Mayo, a newly-discovered law of nature or abstract idea could well be found novel.
The limits of the companies’ view of abstract ideas is discussed. “The difficult, valuable, and often groundbreaking part comes next: designing, analyzing, building, and deploying the interface, software, and hardware to implement that idea in a way that is useful in daily life.” Thus, they regard the real innovation to occur in the creation of fully realized, consumer-oriented technologies. These practical applications allow others to invent around each other, they argue, encouraging new and improved products. They point out that the software industry grew and prospered before patents in the area became common starting in the late 1980s. Such prosperity is at risk due to the proliferation of weak software patents.
The companies also argue for a procedural change, asserting that subject matter eligibility should be decided at the outset of cases, and that the ruling should be as a matter of law. They call for early determination, arguing that no factfinding is needed. They noted that the Myriad Genetics decision was handed down without conduct of discovery. Finally, the companies argue against a clear and convincing evidentiary standard, since, as mentioned, they regard subject matter eligibility as a pure question of law.
“Far from promoting innovation, abstract software patents have impaired it by granting exclusive rights over high-level ideas and thereby blocking others from undertaking the truly innovative task of developing specific applications.” The ruling in Alice v. CLS Bank will reveal if the Supreme Court agrees with the sentiment of these technology giants.
2014 WL 828041 (U.S.) (Appellate Brief)
ALICE CORPORATION PTY. LTD., Petitioner, v. CLS BANK INTERNATIONAL, et al., Respondents. No. 13-298. Supreme Court of the United States.