The Supreme Court’s decision on software patents still doesn’t settle the bigger question


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The Supreme Court's ruling on software patents Thursday dealt a blow to companies that want to patent abstract ideas — a no-no under intellectual property law. The unanimous opinion effectively raises the bar for what computer programs can be patented, helping to limit the number of "bad" patents entering the system and the number of lawsuits that can be filed by patent trolls.

But intellectual property experts are a little put out by the decision in Alice Corp. v. CLS Bank. Here's why: While the court struck down what was universally said to be a bad patent, it didn't do much to say what kinds of software should be patentable. In other words, the court decided the most basic conflict in the case, but more or less declined to offer guidance for other, future cases.

"It was supposed to be the most important patent case of the decade," said Todd Dickinson, the executive director of the American Intellectual Property Law Association. "It turned out to be a little bit like fireworks that fizzled. It didn't really seem to move the needle much either way."

What many were hoping for was some kind of legal test from the court that would help businesses determine what kinds of software could be patented. Designing such a test would have been complicated, and maybe even impossible. But at the very least, maybe the court would agree to clarify what, if anything, about software should be considered an "abstract idea"?

No luck. Writing on behalf of the court, Justice Clarence Thomas explicitly said he didn't need to deal with the abstract-idea problem, because the facts of the case were so obviously against the company with the bad patents, Australia-based Alice Corp., which had received a patent for a computer-aided process to protect the parties in foreign currency transactions.

"We need not labor to delimit the precise contours of the 'abstract ideas' category in this case," Thomas wrote.

That line quickly drew criticism from some legal observers on Twitter.

Patent reform advocates said that in light of the court's limits, only legislation could really prevent the use of bad patents in litigation.

"Unfortunately, neither today's ruling nor any single act by the court or the executive branch can do what is needed to make the business model of being a patent troll unprofitable and unattractive," said Matt Tanelian, executive director of the Coalition for Patent Fairness, which represents tech companies including Google and Samsung.

Others, such as the Chicago-based software company Trading Technologies International, pointed out that the ruling would have a limited impact "because very few patent claims are even arguably directed to a fundamental economic practice" like the kind at issue in the case before the Court.

So while the court's decision doesn't rule out the possibility of narrowing the scope of patentability further down the road, it doesn't seem as though it's done much to settle the broader question of patentability this time.

Brian Fung covers technology for The Washington Post.
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