Patent Law Practice Center

Judge Michel Sounds Off About Alice v. CLS Bank

Recently, I had the opportunity to sit down with Paul Michel, who we in the patent community know as the former Chief Judge of the United States Court of Appeals for the Federal Circuit. When Judge Michel stepped down as Chief Judge and retired several years ago, he told me that he decided to retire so he could say what needed to be said on behalf of the patent system, something he felt he couldn’t do while a member of the federal judiciary. Judge Michel has been true to his promise. He keeps an active schedule.

Judge Michel has been generous with his time over the past several years, and I have interviewed him on a number of topics. Most recently we discussed the Supreme Court’s patent decisions during the October 2013 term, spending most of our discussion on Alice v. CLS Bank.

Below are the highlights of my interview with Judge Michel. If you would like to read the entire interview, which lasted for approximately one hour and spans over 9,000 words, please see: Judge Michel says Alice Decision ‘will create total chaos’.

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IBM Brief: Abstract Idea Jurisprudence Is Unworkable

On March 31, 2014, the United States Supreme Court will hear oral arguments in a case that could determine the fate of software patents in the United States. Recently, IBM filed an amicus brief at the United States Supreme Court in the case of Alice Corporation Pty. Ltd. v. CLS Bank International. While many attorneys contributed to this brief, former Solicitor General of the United States Paul D. Clement is the Counsel of Record on behalf of IBM.

I think it is fair to say that the IBM brief can be summarized as follows: ‘The abstract idea doctrine is unworkable.’ Bravo! If the Supreme Court cannot define the term “abstract idea,” which they have never done,  how can it be at all appropriate for the Court to apply the doctrine as if it has meaning? At least with respect to software, there is also no uniform application of the patent laws, which at least conceptually should raise concerns of disparate treatment of those similarly situated.

Something needs to be done to once and for all acknowledge that software is patent eligible. Even having to say that and hope it is what ultimately happens is truly saddening in the year 2014. Software is all around us and empowers practically everything, and according to a Government Accountability Office (GAO) report from August 2013, somewhere between 50% to 60% of all patent applications filed deal in some way with software. Software is the very backbone of innovation and the fact that we have to wonder whether it is patent eligible more than 46 years after the first software patent issued is really an indictment of the judicial system as it relates to patent law and jurisprudence.

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Cursory analysis of “abstract” by Bilski Court followed in Ultramercial case

The following guest post comes from Stuart Meyer,  a Partner with Fenwick & West.

Not saying, “We told you so, but…”

A decision from the Central District of California in August in the Ultramercial v Hulu case showcases a concern that we expressed about how cursory reliance on a claim being unpatentable because it is “abstract” can lead to unfortunate results. An amicus brief we filed in the Bilski case warned of the problems that could result if the Court applied the term “abstract” without providing a clear indication of the sense in which that term was being used. See amicus brief of On Time Systems.

A claim that is just a vague expression of a concept may be considered “abstract” and therefore correctly be held unpatentable. On the other hand, there are many claims that clearly are eligible for patent protection even though they deal with abstractions. For instance, any use of a sensor deals with something that is abstract – the example we gave in the brief was that a signal produced by a wind sensor is an abstraction of the force of air molecules striking the sensor. Just because a claim is based on a signal from a wind sensor does not mean that it is abstract and therefore unpatentable. (more…)

Bilski’s Impact on Finance Industry Patents

The following was written by Dale Lazar (Partner at DLA Piper and one of our newest Practice Center Contributor’s)  and Jim Heintz (Partner at DLA Piper).

When the Supreme Court announced it would hear the Bilski case, many speculated that the Court would use the opportunity to declare an end to patents on business methods. This did not happen. However, the Court did find that Bilski’s claims to a method for hedging risk were not the kind of invention for which a patent should be granted.

What does this mean for other finance industry patents and patent applications? Certain types of business method patents may be safe for now – but warning signs point to hazards down the road.

Most would agree that the claims of Bilski’s patent application are directed toward a business method. Two aspects of the Supreme Court’s Bilski decision are particularly important to the issue of whether finance industry inventions can be protected by patents: (1) business methods are not categorically excluded from patent protection; but (2) Bilski’s claims to methods for hedging risk are unpatentable because they claim an “abstract idea.” (more…)

More on the Bilski Decision….

I just finished watching IPWatchdog give a live analysis of the Bilski decision on USTREAM.  Here are some more of Gene Quinn’s thoughts on the Decision….

— “The Majority relied on a common meaning of processes when deciding that processes could be patentable, but clearly said the machine-or-transformation test could not be the only test.”

— “All nine justices agreed that an “abstract idea” is unpatentable. I don’t see where in the opinion the Court really defines what is an upatentable abstract idea.” (**read more about abstract ideas below)

— “We don’t have a new test from the Supreme Court.  The Court did what it has done before… telling the Federal Circuit you got it wrong, go back and figure it out.  We clearly need more definition from the Federal Circuit as to what is patentable.”

–Quinn concluded “Pure business methods are in trouble.  But, if you write a good quality application that deals with software where there is a tangible element or some kind of physical structure, you’ll be good to go.”

–“I’m afraid the Decision raises more questions than it answers.”

For more on the Bilski decision, tune in on Wednesday, June 30th, at 1:00 pm for  PLI’s Hot Topic Briefing: Bilski v. Kappos: The Supreme Court Rules on Patentable Subject Matter where an expert panel including Scott M. Alter of Faegre & Benson LLP and Douglas R. Nemec of Skadden, Arps, Slate, Meagher & Flom LLP, co-chairs of PLI’s 4th Annual Patent Law Institute, Gene Quinn, patent attorney blogger and a principal lecturer in the PLI Patent Bar Review course and John M. White, PLI’s Director of Patent Professional Development as they discuss the implications of the decision, and what it may mean for your practice or your company. (more…)