21st jun, 2014

ALICE vs CLS – a case for basic patent virtues

When the supreme court of the United States makes a decision you listen – especially if you are interested in patents. The blogosphere/mediasphere/IPsphere has been buzzing with the Supreme Courts latest decision the last few days. The case Alice Corporation pty. LTD. v. CLS Bank International was decided june 19.


 Petitioner Alice Corporation is the assignee of several patents that dis­close a scheme for mitigating “settlement risk” and had upset CLS who sued them to invalidate the patents. The patents were held invalid by the supreme court in the decision because they relied on an abstract idea. The ruling has been heralded as a mighty blow to the US software patents – notoriously hated and still more debated. The ruling is a walk along memory lane for softwarepatents citing previous rulings like Gottshalk vs Benson and Parker vs Flook.

However the case is not one about software in particular but about basic patent rules. The Court says “Because petitioner’s system and media claims add nothing of substance to the underlying abstract idea, they too are patent ineligi­ble under §101.”

What they are saying is that Alice has taken a good idea and smacked some tech around it and try to patent this – which is not possible. The Court says “We conclude that the method claims, which merely require generic computer implemen­tation, fail to transform that abstract idea into a patent ­eligible invention.”

The case is a simple test of whether anything new of substance is added and unrelated to the software patent debate. On the other hand it is good to see that the Supreme Court upholds the basic barriers of patentability in the US – hopefully preventing abstract patents from filtering thru the system.

The patent in case has a large family around the world but I’m happy to say the the European cousins have all failed.

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