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Software Unpatentable? It depends.

Posted Thursday, June 26, 2014 by Jim Ruttler

The Supreme Court this month issued a long awaited decision in CLS Bank. Many thought that the Supreme Court would use this opportunity to curb the ability to patent software. While the court did invalidate the claims, they did so on the ground that the claims were too abstract and not on the ground that the claims involved software. That is, software remains patent eligible for patent protection after CLS Bank so long as the software is not just performing an abstract idea.

What is an abstract idea? Unfortunately, this is the question that we all have as inventors and patent attorneys. CLS Bank indicated that the rule for patent edibility has always limited patenting of building blocks of human knowledge or natural phenomenon. I’m not certain that it always has been that way, since the court in State Street Bank in the 1990’s famously said anything under the sun and made by man is patentable. What is patentable actually seems to have changed quite often over the past decade.

Nonetheless, this is the test that is ultimately required for determining patent eligibility. If it is abstract then it can’t be patented – even if the invention is implemented in hardware – unless the invention involves some transformation of the abstract idea. If it isn’t abstract, then it can be patented as a method, software, or hardware.

Examples of abstract ideas given by the court were things that were already known at the time of the invention with the only improvement being the addition of a computer into the mix: hedging risk, financial settlements, calculating drug dosages based on metabolite levels, etc. The Court went on to state that there are instances when calculations and methods are patent eligible – it is when the method itself is new and not just implementing it on a computer.

Thus, if you are only adding a computer to something that has already been known, you probably have an abstract, unpatentable invention.

Software Unpatentable? It depends.  ›› Ruttler Mills PLLC