Business owners should be aware that patentability of business methods has again raised its ugly head. The United States Supreme Court has unequivocally stated that a business method which is merely an abstract economic idea is not patentable subject matter. More recently, in Cybersource Corporation v. Retail Decisions, Inc., there were two requests for protection (claim sentences) for a method and system of detecting fraud in a credit card transaction over the Internet. The claim sentences did not designate specific tangible requirements for detecting fraud, and so the alleged infringer contended that these two claims were not patentable subject matter.
One of these problematic claims reads as follows:
A method for verifying the validity of a credit card transaction over the internet comprising the steps of:
a) obtaining information about other transactions that have utilized an Internet address that is identified with the credit card transaction; and
b) constructing a map of credit card numbers based upon the other transactions; and
c) utilizing the map of credit card numbers to determine if the credit card transaction is valid.
The court first reviewed the history of the patentable subject matter conundrum and the continuing challenge to select appropriate criteria for the determination of such. Some law is well settled: (i) laws of nature, (ii) natural phenomena and (iii) abstract ideas per se can never be patentable. The rub has always been to determine whether an invention is primarily one of these exceptions or is primarily tangible and qualifies for patent protection. Numerous tests have evolved to assist in this gray area: mental steps, data gathering steps, transformation of tangible subject matter, machine or transformation test to name a few.
With these tests in mind, the court concluded this Cybersource claim was fatally over broad because it included all methods of detecting credit card fraud over the internet. The court also concluded that this claim improperly included methods to access abstract information with only the use of pen and paper. In particular the method was actually a series of mental activities to identify fraudulent transactions, and mental activities (mental steps) are abstract ideas that do not comprise patentable subject matter.
The second challenged claim was a version implementing the method of the first claim together with a generic computer medium. In particular, the claim sentence reads “a computer readable medium containing program instructions” and “one or more processors of a computer system.” The court concluded this claim was an overbroad version of the mental steps method claim, and therefore was not drawn to a novel computer readable medium in view of the fatally defective method steps.
My recommendations for claim drafting have not changed from my original thoughts on this subject. In brief, any economic method claim sentence that is (i) broadly worded and (ii) is potentially accomplished with paper and pen is most likely only an abstract idea. If you have a true software invention, the claims should still be drafted as broadly as possible. However, there should be specific computer technology incorporated in the claim and not merely in a data gathering or collateral manner.
© 2011 Adrienne B. Naumann
Ms. Naumann does not endorse or sponsor the advertisements at adriennebnaumann.wordpress.com.