U.S. Supreme Court Does Not Kill Business Method Patents

[PaulPA]

Justices Take Broad View of Business Method Patents [nytimes.com]

Justice Sonia Sotomayor, for example, asked whether there could be a patent on a method of speed dating. Justice Stephen G. Breyer asked whether he should be able to obtain a patent for his “great, wonderful, really original method of teaching antitrust law” that “kept 80 percent of the students awake.”

The decision, however, closed off no options to patent seekers, though the justices unanimously declared that the process at issue in the case could not be patented.

Many involved in Internet companies had feared the worst when this case went to the Supreme Court since business method patents have been an important form of protection for their business model. But it appears their fears were not realized as the business method patent is not dead.

[edited by: engine at 4:13 pm (utc) on Jul 1, 2010]
[edit reason] added quote [/edit]

[physics]

PaulPA, the counterpoint to your comment is that many concerned citizens were hoping that the court would use this as an opportunity to totally reform patent law to stop abusive software and business method patents.
It seems like many are seeing this as a mixed victory:


Free Software Foundation
[fsf.org...]

As opinions form about the extent to which the Court ruling impacts the patenting of software, one thing is clear. The State Street ruling that in 1998 opened the flood gates to the patenting of business methods and software has been gutted, if not technically overturned. The vast bulk of software patents that have been used to threaten developers writing code for a GNU/Linux distribution running on general purpose computers have in theory been swept away. The State Street ruling said that you could patent an item if there was a "useful, concrete and tangible result." In the Bilski ruling, the CAFC have set aside State Street and left us with what they believe to be a simplified test for patentability: the machine or transformation of matter test:

Thus, the proper inquiry under section 101 is not whether the process claim recites sufficient "physical steps," but rather whether the claim meets the machine-or-transformation test. As a result, even a claim that recites "physical steps" but neither recites a particular machine or apparatus, nor transforms any article into a different state or thing, is not drawn to patent-eligible subject matter. Conversely, a claim that purportedly lacks any "physical steps" but is still tied to a machine or achieves an eligible transformation passes muster under section 101."

Electronic Freedom Foundation
[eff.org...]

By watering down the CAFC’s “machine-or-transformation” test, the Supreme Court regrettably failed to provide guidance in the future about business method patents. For example, suppose a patent claim is not clearly unpatentable as just an abstract idea, but it does fail the now-optional “machine-or-transformation” test. When will such a claim be patentable? The Court did not answer that question, or provide details about how to apply its “abstract idea” test.

In sum, the Supreme Court’s ruling eroded the CAFC’s limits on process patents, and thus missed an opportunity to fix some of the problems with those patents.

[kaled]

Whilst I support patenting of software, it seems that some patent applications are not really software, rather they are about formats and protocols. Since most file formats and communication protocols include mostly arbitrary decisions (albeit, with a goal in mind) it's hard to see any justification for these. For example...

If I were to reinvent the wheel and come up with a super-wheel, whilst an implementation would include arbitrary choices of materials and dimensions, etc. the patent would not rely upon such details. This being the case, it seems to me that this simple test could determine the patentability of ideas.

Using a familiar example...

The zip file format itself is arbitrary therefore not patentable.
The compression methods used (primarily deflate) are not arbitrary and are therefore patentable, however
The decompression methods available are arbitrary therefore not patentable.
Thus a zip file creator might require a license but a zip file reader would not.

Taking http as an example, since all decisions with respect to this format were taken arbitrarily, this would not be patentable.

Taking image compression, a browser which merely displays images would not require a license but an image editor that creates new images might.

Does this seem sensible to other people?

Kaled.

[ChocolateDimple]

@Kaled - Your points are valid and they make sense to me.

From a logical point of view business models should be dissected and viewed on a case to case basis, the potential impact it would have being patented, the limitation to creativity of other sorts if a revolutionary business model were to emerge that could change the way businesses are run (if i'm not mistaken) eg. Col Sanders started the royalty system with KFC.

However, when I put myself in the position of the courts, they have a duty to safeguards the interests of the public and the greater good.

Tough call when you're sitting in their chair wearing their shoes.

[graeme_p]

@Kaled, so after your exceptions what is left? Not much.

I see no reason for software patents as the technology advanced extremely fast without them: how many significant new ideas is software have come since software patents were introduced.

Business method patents are no good to anyone other than patent trolls and lawyers.

[kaled]

I see no reason for software patents

Lot's of people see no reason for any sort of patents. If you consider the purpose of patents to be to encourage technical development, you and they may be right, but if you take the view that people are entitled to profit from good ideas (as I do) you are wrong. Consider this...

Suppose I spend six months writing an adventure story - my rights are protected by copyright.
Suppose I spend six months developing a completely new software technology why should I have no rights (beyond bragging) to that work?

Doubtless you will say that copyright can be applied to software - that's true, but if you extend that argument so that software is protected from plagiarism too - well, the end result would be far longer-lasting protection for software that patents offer! What's more, no one would even have to register their work so this would be more expensive and even more letigious than patents. I'm guessing but I don't think that's what you want.

Kaled.

[graeme_p]

Copyright does apply to software, so you get the copyright litigation plus the patent litigation. In fact software can be copyright, patented and a trade secret all at once.

Suppose I spend six months developing a completely new software technology why should I have no rights (beyond bragging) to that work?

Why is that society's problem? If we abolish software patents and copyrights you could stop developing software, but plenty of other people would carry on, so who cares?

Anyway, as things stand, if we abolish patents, you would still have the copyright, which is a lot more than bragging rights.

I do not understand your last paragraph. Are you unaware that software is covered by copyright, and always has been? You are describing the current situation, except that we have patent litigation on top of it!

[kaled]

The current situation with software copyright is that code is copyrighted but logical methods are not. If someone is smart enough to reverse engineer code then copyright isn't likely to offer much protection. Also, if someone is able to more or less reproduce the same functionality from published specifications, copyright will not apply.

The logical methods that lie behind complex software technologies are not protected by copyright, if they were, no one would care about patents i.e. there would be nothing to argue about.

Kaled.