The Supreme Court is to Take Up Software Patents

I messed this in December, when the Supreme Court agreed to rule on the validity of software patents:

Renewing its recent fascination with the kinds of inventions that can be patented, the Supreme Court on Friday agreed to clarify when an analytical method implemented by a computer or by a link on the Internet is eligible for monopoly protection. This was the only new case granted. The Court will be reviewing a widely splintered decision by the U.S. Court of Appeals for the Federal Circuit, in the case of Alice Corporation Pty. Ltd. v. CLS Bank International (docket 13-298). The en banc Federal Circuit found the method at issue ineligible for a patent, but a majority could not agree on a standard for making such decisions.

The case will provide a new test of the Patent Act’s most basic provision — Section 101, which broadly outlines what kinds of inventions are patentable. One of the long-standing exceptions to the types of inventions mentioned in that section is that an abstract idea can never be patented. That issue arises frequently these days, especially with rapidly developing technology in computer software. The Justices have dealt with that issue several times in recent years.

Alice International, an Australian company that is half-owned by the National Australia Bank Ltd., obtained patent protection on a method invented by its founder, Ian Shepherd, for exchanging financial instruments, with the aim of assuring that, when two parties have agreed to an exchange of currency or other financial goods, they actually deliver on the deal. Because such agreements are often delayed at least a few days in implementation, there is a risk that one side won’t live up to the agreement. The invented program works out a settlement arrangement to determine which side is obliged to deliver. It generates instructions to the institutions involved to carry out their agreement.

Hopefully, this means that the Supreme Court is willing to overrule the U.S. Court of Appeals for the Federal Circuit, aka "The Patent Court", which has ignored Supreme Court precedent for years:

This spring, the Supreme Court will weigh in on the patentability of software for the first time in a generation. In the 1970s, the high court placed strict rules on software-related patents. But since then, a lower court has effectively overruled the Supreme Court's precedents, allowing hundreds of thousands of legally dubious software patents to be approved.

The arguments in the software patent debate have barely changed since the 1970s, but the players in the debate have changed radically. In 1972, IBM was a leading software patent opponent. Today, Big Blue has become one of the concept's biggest supporters. In 1991, Bill Gates warned that patents could bring the software industry to a "standstill." Today, Microsoft is fighting to protect the tens of thousands of software patents in its portfolio.

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During the 1970s, patent law was shaped by a Supreme Court that was skeptical of patents on software. Even its 1981 decision [which allowed for a computer controlled method of curing rubber involving a computer to constantly monitor temperature] emphasized that there were limits on software-related patents. In 1982, Congress made a seemingly innocuous change to the structure of the court system that had a profound impact on the legal status of software patents.

Most areas of the law are handled by generalist judges organized into a dozen geographically based appellate courts. But Congress, concerned that patent law had become too complex for generalist judges, created a new court called the Federal Circuit Appeals Court. The Federal Circuit was given jurisdiction over all patent appeals. And perhaps because its judges spend so much time rubbing elbows with patent attorneys, the new court would prove to have a strong pro-patent bias.

An important turning point came in a 1994 ruling involving a computer graphics technique called anti-aliasing. ………

Anti-aliasing was a technique which had been known for decades, but the patent court ignored precedent, and allowed the patent, and opened up the floodgates, which later extended to business models and financial constructs.

I think that it is likely that SCOTUS will issue significant restrictions, because, ever since the Blackberry case, pretty the only time that they take up a case like this, it is to slap down the maniacs in the Patent Court.

They need to come down on this bullsh%$ hard, because the jokers in the U.S. Court of Appeals for the Federal Circuit are arrogant clueless extremists.