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By Lawrence Hurley
WASHINGTON, June 19 The U.S. Supreme Court on
Thursday modestly cut back on software patents by ruling that
simply implementing an abstract idea using a computer does not
make an invention eligible to be patented.
On a 9-0 vote, the court ruled for CLS Bank International,
which challenged patents held by Australia-based Alice
Corporation Pty Ltd for a computer system that facilitates
financial transactions. The court added some clarity to a
confused area of the law concerning when software can be
patented but did not provide a definitive test on when software
can be patented as some had hoped.
The ruling left open questions about under what
circumstances the use of a computer adds enough to the idea to
make it patent eligible.
At a minimum, the ruling is likely to help tech companies
fend off lawsuits filed by "patent trolls," defined as companies
that hold patents only for the purpose of suing firms seeking to
develop new products.
"It's going to clear away a lot of illegitimate claims
pretty quickly," said Andrew Pincus, a lawyer with the Mayer
Brown law firm who filed a brief on behalf of a technology trade
The ruling in some ways mirrors a 2010 case, Bilski v.
Kappos, in which the court was expected to offer guidance on
business method patents but eventually issued a relatively
narrow 9-0 decision.
In Thursday's majority opinion, Justice Clarence Thomas
wrote that the outcome was determined by two of the court's
recent patent rulings.
"We hold that the claims at issue are drawn to the abstract
idea of intermediated settlement and that merely requiring
generic computer implementation fails to transform that abstract
idea into a patent-eligible invention," Thomas wrote.
The legal question boiled down to how innovative an
invention should be to receive legal protection.
The U.S. Patent Act states that anyone who "invents or
discovers a new and useful process, machine, manufacture, or
composition of matter," or an improvement of an existing one,
can get a patent. An invention related to an abstract idea can
be patented, but it must include a way of applying the idea.
Google Inc, Dell In c , Verizon
Communications Inc, and Microsoft Corp were among
the companies that filed legal papers weighing in on the issue.
Companies differ over what kind of eligibility threshold
they would prefer. Those that often get sued for patent
infringement, such as Google, favor a tighter definition. Those
that want to protect their own patents, such as IBM Corp,
would prefer that most software be patent eligible.
In May 2013, the U.S. Court of Appeals for the Federal
Circuit ruled for CLS but the judges were split 5-5 on which
legal test to adopt.
The case is Alice Corp v. CLS Bank, U.S. Supreme Court,
(Reporting by Lawrence Hurley; Editing by Howard Goller and