Software Patent

Software and business method patents, post-

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Earlier this month, the U.S. Court of Appeals for the Federal Circuitupheld a ruling by the U.S. Patent Office denying a patent for methods of hedging in commodities trading. The decision, In re Bilski, is significant because it raises the bar for “business methods” and software-related patents. Companies pursuing or enforcing such patents would be wise to survey the post-Bilski landscape.  The following questions offer a starting point for that analysis.

How does the Bilski decision affect “business method” and software patents?

The Bilski court reconsidered earlier decisions that had liberalized patent standards. These decisions brought a surge in e-commerce and software applications just as Internet-based businesses were taking hold. As a result, the number of patents directed at “business methods” — ways of finding, serving and keeping customers — and web technologies skyrocketed. Now, the Federal Circuit has retrenched, limiting patentability to inventions that are tied to a particular machine or that transform an “article” into a different state or thing. 

Can I patent software running on a general purpose computer?

The Bilski court focused on data-processing methods, and did not address the patentability of hardware or software per se. A key question for the future is how the phrase “tied to a particular machine” will be applied to software patents. If interpreted narrowly — i.e., requiring the use of special-purpose computing hardware to receive a patent — many, if not most, business method and software patents may not survive. If it is read less restrictively, the status quo may prevail. In either case, patents for inventions implemented as software should include some structural and functional components in the patent application and the claims. Claims covering human activity are now seemingly a thing of the past. 

Are there any other changes we...