Supreme Court confirms validity of software patents

The Supreme Court’s decision invalidating a software patent for a process that lessens settlement risk for trades of financial instruments in Alice Corp. Pty. Ltd. v. CLS Bank Int’l might not jump out as a win for software patents.  However, those of us concerned that the Supremes might invalidate software patents entirely breathed a collective sigh of relief when we read the opinion.

As former USPTO Commissioner David Kappos observed over at the SCOTUS blog, the Alice decision stands for the proposition that “software, as a class, is every bit as worthy of patent protection as any other medium in which innovation can be practiced.”

The IP Finance blog even went so far as to suggest that the Alice decision “may even encourage more [software] patents to be filed.”  IP Finance also provides this interesting observation on the topic of patent monetization after Alice:

One further factor that will also affect the valuation of the patent is the court’s comments that the claims “did not purport to improve the functioning of the computer itself”, nor “do they effect an improvement in any other technology or technical field”. This language is consistent with the European Patent Office‘s standard rejections for computer-implemented inventions that are deemed not to meet the EPO’s tests for patentability. We seem to be seeing a convergence in thinking on what constitutes an acceptable patent for a computer-implemented invention in the US and in Europe. Another uncertainty factor in valuing software patents is being eliminated.

So while the decision might not have been in favor of the patent holder in Alice, in the long term Alice might stand as the decision that solidified the role software patents can play in providing value to their owners.

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Joel B. Rothman represents clients in intellectual property infringement litigation involving patents, trademarks, copyrights, trade secrets, defamation, trade libel, unfair competition, unfair and deceptive trade practices, and commercial matters. Joel’s litigation practice also includes significant focus on electronic discovery issues such as e-discovery management and motion practice relating to e-discovery.

Joel B. Rothman represents clients in intellectual property infringement litigation involving patents, trademarks, copyrights, trade secrets, defamation, trade libel, unfair competition, unfair and deceptive trade practices, and commercial matters. Joel’s litigation practice also includes significant focus on electronic discovery issues such as e-discovery management and motion practice relating to e-discovery.

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