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Supreme Court could limit software patents in Alice case

Grant Gross | April 3, 2014
A case before the U.S. Supreme Court earlier this week could have a huge impact on business-method and software patents, with some experts concerned that the court could put significant limits on what can be patented.

Lawyers for both Alice and CLS Bank urged the court to rule narrowly in their case, but patent experts said the court is likely to address the bigger issue of computerized business-method patents.

Justices could apply past decisions to the Alice patents and stop there, or could go a step further and extend their ruling in the 2012 case Mayo v. Prometheus, in which the court ruled that a method of giving a drug to a patient wasn't eligible for a patent, to abstract ideas run on a computer, said Fabio Marino, a computer scientist and IP attorney at McDermott Will & Emery.

Justices didn't advocate for a "bright-line test" throwing out all software and business-method patents, he said. "The more reasonable assumption is they will come up with a more limited test," he said.

The high court may look for a test that permits patenting of a computerized business method only when it describes a detailed and substantive process related to running on a computer, added Rob Unikel, an IP lawyer with Kaye Scholer.

"Of course, the difficulty is in predicting whether the justices will be able to agree on the proper formulation of such a rule or test — certainly the Federal Circuit wasn't able to — and, if so, what the precise requirements of that rule or test will be," he said by email. "As the saying goes, the devil is in the details."

The court could rule narrowly on Alice's patents, or it could "try to articulate a rationale for what might make certain software or business methods patent eligible, while others are patent ineligible," added IP attorney Jennifer Spaith with Dorsey & Whitney.

The case raises the question about whether software and business methods are patentable, but the court may not go that far, she said. "The court has the ability to state that certain subject matter, such as software or business methods, simply isn't eligible for patent protection, no matter how innovative or commercially successful the subject matter may be," she said by email. "The issues are nuanced, so a complete ban on all software patents, for example, is not likely."


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