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A patent application must satisfy several basic requirements, including novelty (35 USC §102 (2006)) and non-obviousness (Id. §103). In addition, claims must be directed to "statutory" or "eligible" subject matter (Id. § 101), since a patent cannot be issued for an "abstract idea," "natural phenomenon," or "law of nature." Recently, the subject matter eligibility of certain types of inventions, such as software and business method inventions, has been called into question due to the Supreme Court decision in Alice v. Bank. Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347 (2014), which held that implementation of an otherwise well-known business method on a generic computer was not sufficient by itself to provide subject matter eligibility.
Alice applied a two-step process, whereby 1) it is first determined if the claim is directed to an abstract idea, and if so, then 2) it is determined whether the claim includes "something more" that would transform the abstract idea into a patentable invention. However, the Alice decision did not adequately define an abstract idea, nor what would constitute "something more." Since Alice, the USPTO has done its best to clarify these issues, but further decisions by the courts will be needed before they are fully resolved. So far, some significant cases have been decided by the courts, such as DDR Holdings v. Hotels.com (L.P., 773 F.3d 1245 (Fed. Cir. 2014)), which upheld the validity of computer-implemented patent claims that addressed a technological problem "particular to the internet." More recently, the Central California district court decision in Cal. Inst. of Tech. v. Hughes Commc'ns, Inc., 2014 WL 5661290 (C.D. Cal. Nov. 3, 2014) provided a through and well-reasoned analysis that will hopefully guide the Federal Court of Appeals in future decisions.
Nevertheless, for the time being much uncertainty remains. Will non-tangible inventions be significantly limited ("down the rabbit hole"), or will Alice merely serve to clarify the requirements for subject matter eligibility, without significantly impinging on the patentability of novel and non-obvious software and method inventions ("through the looking glass")?
So, if you have invented a novel, non-obvious invention that does not produce a tangible product, and is not directly tied to a specialized apparatus, how should you proceed? One thing is certain: if you don't file you will lose any chance of patenting your invention. Hence, it may be advisable to continue filing patent applications for important new software and method inventions, even in light of the present uncertainty, so that your patent rights are maintained while the issues raised by Alice are slowly resolved. Otherwise, by the time the "sky" clears that "ship" may have already "sailed"!
And as always please SPREAD THE WORD!
This is one example of how, here at MCR, we try to keep the community informed of the changing legal landscape. Please contact me or anyone here for more information. And please pass this along to anyone you know who may be interested in intellectual property legal services. Author Doug Burum may be contacted at dburum@mcr-ip.com and (603) 886-6100.
Thank you,
Douglas P. Burum, Ph.D., Agent
Registered Patent Agent
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