Once more with feeling: patentable subject matter

The United States law of patent eligible subject matter continues to rapidly evolve. In Bilski v. Kappos, the Supreme Court confirmed that abstract ideas by themselves are never patent eligible, even if characterized as business methods. The Bilski decision was factually straightforward, because there was no computer technology disclosed (i) in the patent application text (known as the “specification”) or (ii) the formal requests for protection at the end of the patent application (known as the “claims”). However, how does one determine whether an invention is merely an abstract idea, or eligible subject matter when the patent or patent application ties computers to the invention?

Two post Bilski cases provide different answers that depended upon the nature of the computer related information. A recent appellate decision addressed patent eligibility of a life insurance policy management system, and a process for implementing this system, in which a computer was a component. Bancroft Services L.L. C. v. Sun Life Assurance Company of Canada et al. The court began its analysis by stating that for patent eligibility of an otherwise abstract idea, the computer must (i) be integral to the invention and (ii) facilitate the process in a manner that a human could not perform.

For example, if the computer implementation of an abstract idea (in this case a business method for managing life insurance policies) could be performed manually with a desk calculator, paper and pencil, or in a person’s mind, then the invention is not patent eligible. The Bancroft court concluded that in this specific instance the computer was only incidental to the abstract concept of managing life insurance policies. Because the method and system could be performed without the computer there was no patent eligibility.

On the other hand, in another decision on different facts the same court came to a different result. CLS Bank International et al. v. Alice Corporation Pty. LTD. The invention in this case included: a data processing system for exchanging obligations, a method for exchanging obligations between parties, and a computer program product. According to this decision, computers were necessary to the invention, as evidenced by technical computer terms in the specification and claims. The court also concluded that this particular computer implementation provided a significant limitation on the scope of the invention, and so the patent did not prevent future innovation. Interestingly, this decision confirms an earlier decision in which the invention included methods directed to a GPS receiver. SiRF Technology, Inc. et al v. International Trade Commission et al. In SiRF the court concluded the GPS receiver (i) placed a significant limitation on the scope of the invention, and (ii) was essential to the claimed methods and not merely a device for accelerated calculations.

I strongly recommend a detailed review these appellate decisions for all business persons prior to initiating computer implemented business method patent applications. Keep in mind that the most patent eligible inventions in this context are those in which the subject matter is an actual improvement to a previously existing computer system or method (such as in SiRF). Finally, be sure to retain a patent service provider with a degree in computer science if you invest in a computer related invention. Such a professional will knowledgeably draft a technically complete specification and claims. This professional would also approach the entire project from a software and engineering perspective, and thereby disclose how the computer is actually implemented and not merely used.
© 2012 Adrienne B. Naumann
Ms. Naumann does not sponsor or endorse the advertisements at adreinnebnaumann.wordpress.com.

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