Software inventions are patentable depending on how you claim it

The eligibility of patent protection for software patents is the hot topic in patent law.  For now, the attack on patents hasn’t spilled over into other technologies (e.g., mechanical arts may be abstract).  For patent attorneys, the big question is not whether software inventions are eligible for patent protection.  It is settled law that software is eligible for patent protection.  It just depends on how you claim the software.  The narrow issue being decided is “how software should be claimed?”How granular does the claim language have to be so that the claimed invention falls within the realm of patent eligible subject matter.

In Accenture Global Services v. Guidewire Software (Fed. Cir. 2013), the Federal Circuit reviewed the claim language and compared it to three other software patent cases.  One case held that the claim language is patent eligible.  The other two cases held that the claim language is not eligible for patent protection.  The Federal Circuit then concluded that the claim language involved in the instant litigation was more akin to the patent ineligible cases, and thus invalidated the patent.  Below is a comparison of the language of the claims in the respective cases with the hope that you can get a feel for the type of claim language that might be deemed patent eligible.

The table below provides a description of how the Federal Circuit described the claim language in the cases.  Below the table, I provide the full language of the claims in those other software patent cases.  After a review of these claims, I must side with the dissent that:

“Any claim can be stripped down, simplified, generalized, or parphrased to remove all of its concrete limitations, until at its core, something that could be characterized as an abstract idea is revealed.”

It seems that the majority in this opinion has done just that.  The fear is that the examiners and judges can be results oriented based on their own preconceived notion of what should and shouldn’t be patented.  They can either frame the invention generally, and thus ineligible for patent protection or granularly, and thus eligible for patent protection.  When you read through the description of the claims by the court in relation to the other cases (i.e., Ultramercial, CLS Bank and Bancorp), it appears that the claims in the Ultramercial case is obviously patent eligible, whereas the claims in the CLS Bank and Bancorp cases are ineligible.  However, when you read through the actual claim language, you come up with a different conclusion.

Regardless of your opinion of the courts handling of the claim language, this is the opinion of the court and we must try our best to craft claim language more in line with Ultramercial than Accenture, CLS Bank and Bancorp.

I invite you to contact me with your patent questions at (949) 433-0900 or [email protected]. Please feel free to forward this article to your friends. As an Irvine Patent Attorney, I serve Orange County, Irvine, Los Angeles, San Diego and surrounding cities.

A.   Representative claim of Ultramercial (Patent Eligible)

A method for distribution of products over the Internet via a facilitator, said method comprising the steps of:

a first step of receiving, from a content provider, media products that are covered by intellectual property rights protection and are available for purchase, wherein each said media product being comprised of at least one of text data, music data, and video data;

a second step of selecting a sponsor message to be associated with the media product, said sponsor message being selected from a plurality of sponsor messages, said second step including accessing an activity log to verify that the total number of times which the sponsor message has been previously pre-sented is less than the number of transac-tion cycles contracted by the sponsor of the sponsor message;

a third step of providing the media product for sale at an Internet website;

a fourth step of restricting general public access to said media product;

a fifth step of offering to a consumer access to the media product without charge to the consumer on the precondition that the con-sumer views the sponsor message;

a sixth step of receiving from the consumer a request to view the sponsor message, wherein the consumer submits said request in response to being offered access to the media product;

a seventh step of, in response to receiving the request from the consumer, facilitating the display of a sponsor message to the consumer;

an eighth step of, if the sponsor message is not an interactive message, allowing said con-sumer access to said media product after said step of facilitating the display of said sponsor message;

a ninth step of, if the sponsor message is an interactive message, presenting at least one query to the consumer and allowing said consumer access to said media product after receiving a response to said at least one query;

a tenth step of recording the transaction event to the activity log, said tenth step including updating the total number of times the sponsor message has been presented; and

an eleventh step of receiving payment from the sponsor of the sponsor message displayed.

B.   Representative claim of CLS Bank (Patent Ineligible)

33. A method of exchanging obligations as between parties, each party holding a credit record and a debit record with an exchange institution, the credit records and debit records for exchange of predetermined obligations, the method comprising the steps of:

(a) creating a shadow credit record and a shadow debit record for each stakeholder party to be held independently by a supervisory institution from the exchange institutions;
(b) obtaining from each exchange institution a start-of-day balance for each shadow credit record and shadow debit record;
(c) for every transaction resulting in an exchange obligation, the supervisory institution adjusting each respective party’s shadow credit record or shadow debit record, allowing only these [sic] transactions that do not result in the value of the shadow debit record being less than the value of the shadow credit record at any time, each said adjustment taking place in chronological order; and
(d) at the end-of-day, the supervisory institution instructing one of the exchange institutions to exchange credits or debits to the credit record and debit record of the respective parties in accordance with the adjustments of the said permitted transactions, the credits and debits being irrevocable, time invariant obligations placed on the exchange institutions.

C.   Representative claim of Bancorp (Patent Ineligible)

1.  A life insurance policy management system comprising:

a policy generator for generating a life insurance policy including a stable value protected investment with an initial value based on a value of underlying securities of the stable value protected investment;

a fee calculator for calculating fees for members of a management group which manage the life insurance policy;

a credit calculator for calculating credits for the stable value protected investment of the life insurance policy;

an investment calculator for determining an investment value and a value of the underlying securities of the stable value protected investment for the current day;

a policy calculator for calculating a policy value and a policy unit value for the current day;

digital storage for storing the policy unit value for the current day; and

a debitor for removing a value of the fees for members of the management group which manages the life insurance policy.