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SCOTUS justices must step up on software patents



James Nurton


Few topics in IP have proved as divisive and difficult in the past 20 years as patent protection for software. A sensible decision from the US Supreme Court in the Alice v CLS Bank case could help to bring peace

Contributions to the debate on whether or not patents should be granted for software are strongly felt, well argued and can become emotional. When the EU was debating the CII Directive, one MEP told me she had received more hate mail regarding software patents than on any other topic during her term.

The outcome of that debate, as many readers will remember, was that the Parliament overwhelmingly rejected the Directive and it was dropped. As far as European patents are concerned, computer programs "as such" remain unpatentable.

By contrast, the US has laid out the red carpet for software and business method patents, at least since the Federal Circuit’s State St decision in 1998 which gave us the "useful, concrete and tangible result" test. The 15 years after that coincided with the explosion of the internet and e-commerce, and the liberal approach to software patentability contributed to the continual growth in filings at the USPTO.

Put crudely, it was US = good, Europe = bad for software patents (unless you were an unbeliever, in which case it was Europe = good, US = bad).

But that simple distinction no longer stands. In Europe, the law is predictable and patent attorneys will tell you that a good invention, with a cleverly worded set of claims, can still get protection at the EPO. The data support this: the EPO grants about 2500 software patents annually. Even courts, such as those in the UK, that were robust in rejecting software patents, have softened. In the US, though, following the Supreme Court’s curious decision in Bilski v Kappos and the Federal Circuit’s split over CLS Bank v Alice, there is considerable uncertainty. (This was clear in two webinars we held last year, both of which you can still listen to – Software Patenting in Europe and Software patents after CLS Bank.)

In our latest issue, we published a survey of approaches to software patents in five jurisdictions (Australia, China, India, the US and the EPO). Each contribution addressed five questions about the patentability of software and strategies for protection. Gareth Fennell and Rob Genders, writing on Europe, say that EPO practice is "relatively settled" and it is a myth that the Office does not grant software patents. But John Collins, of Schwegman Lundberg Woessner, notes that the US is "arrived at a point of confusion and uncertainty".

The diversity of approaches increases the further afield you look. Last week, Marks & Clerk published a preview of their High-Tech Report 2014, which provides data and analysis on software patents in the EPO, the UK, Germany, France, the US, Canada, China, Asean, Singapore, Australia and New Zealand. Mark Kenrick, a partner of the firm and one of the report’s authors, told me: "The inconsistency in this area is a problem. It leads to misunderstandings about what can and cannot be patented."

The almost-theological divide between software patent believers and atheists will probably never be bridged, and it would be naive to hope for an international agreement. But a clear and well-reasoned decision from the Supreme Court in the Alice case could go some way towards reconciling those of different views. I know some observers are not optimistic, but let’s hope that, after previously ducking the issue, the justices will this time be up to the task.

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