Three Things from SCOTUS Oral Argument in Alice v. CLS Bank


On Monday, March 31, 2014, the United States Supreme Court held oral arguments in the much-anticipated software battle between patentee Alice Corporation, the petitioner, and CLS Bank, the respondent who was victorious below thanks to an equally divided Federal Circuit.

Oral arguments are but one piece of the overall puzzle, so we can easily make too much of their importance, but they are the only way the concerned public can see behind the curtain at the Supreme Court. By many accounts, oral arguments are the least significant piece of the puzzle with many, if not most, Justices relying most heavily on the briefs. Indeed, during oral argument, Justice Breyer specifically stated that he had read each of the amici briefs, which seems a near herculean task given the number of other cases the Supreme Court considers and the sheer volume of briefs filed in this case. 

Even with oral arguments being less important than they may seem, there will be all kinds of attempts to predict what the likely outcome will be based on this sneak peek. Of course, it is impossible to know how a Justice will decide based on the questions asked during oral argument. Case in point — did anyone think the Chief Justice would rule in favor of Obamacare? But for now, the oral argument transcript is all we have to rely on. So with that in mind, here are three things that piqued my interest during the oral arguments.

1. Justice Scalia, the patent guy?

Justice Antonin Scalia is (in)famous in patent circles for calling patent law “gobbleydegook” during the KSR v. Teleflex oral arguments, and being the only Justice in Bilski to refuse to sign onto an opinion that would have found software patent-eligible. Yet, Scalia seemed to be on the side of the patentee and in favor of not making this case about patent-eligible subject matter. At one point he asked whether the issues here weren’t really about novelty, and he was the first Justice with a friendly question to Alice’s attorney. Scalia, seemingly trying to pick apart the argument that a computer recited in a claim isn’t enough and perhaps also address the argument that a process can’t be patented if it merely does something faster that a human could do, asked:

[W]hy isn’t doing it through a computer not enough? I mean, was the cotton gin not an invention because it just means you’re doing through a machine what people used to do by hand? It’s not an invention.

Few could have predicted that Scalia would take this case so seriously and seemingly be on the side of the patentee.


2. Losing Justice Kennedy

Kennedy’s early question to Alice’s attorney was essentially this: Is there an invention here or is what you are claiming so obvious that it could be created by anyone after the requirements were explained? The exchange between Justice Kennedy and Phillips went like this:

JUSTICE KENNEDY: Well, let me put it this way: If you describe that to a second­-year college class in engineering and said ‘here’s my idea, now you go home and you program over this weekend,’­­ my guess is that that would be fairly easy to program.

MR. PHILLIPS: I don’t disagree with it, Justice ­­

JUSTICE KENNEDY: So the fact that the computer is involved, it ­­ it seems to me, is necessary to make it work. But the innovative aspect is certainly not in the creation of the program to make that work. All you’re talking about is ­­ if I can use the word ­­ an “idea.”

MR. PHILLIPS: I prefer not to use that word for obvious reasons.


This and other questions related to Kennedy probing to see whether coding would be a simplistic matter once the invention were described. Of course, it should be a simplistic matter because the coding is not the invention. The invention is the system design, so the patent application should be a design document that would explain everything that a coder needs to do in order to create the systems.


3. CLS Bank’s Severe Exaggeration

At the beginning, the attorney for CLS Bank wasted little time before saying something rather controversial. He stated matter of factly:

Bilski holds that a fundamental economic principle is an abstract idea and Mayo holds that running such a principle on a computer is, quote, “not a patentable application of that principle.” Those two propositions are sufficient to dispose of this case.

Mayo actually did not deal with computers, but rather dealt with a method of optimizing the therapeutic efficacy of a treatment. In Bilski, the Court merely held that the machine-or-transformation test is not the only test and was too restrictive, that business methods are patent eligible, and that the claims there were patent ineligible under the abstract idea doctrine. Notably, however, the Supreme Court did not say why or how the claims were abstract, just that they were, which is one of the major criticisms of Bilski. Thus, from the very beginning, CLS Bank seemed to base their entire argument on a fundamental, and rather severe, misreading of the primary precedent.

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