Reaction: Alice v CLS Bank impact not limited to computers


A hotly-anticipated US case that said computer-implemented inventions are not patentable could have wide-reaching consequences beyond software patents, lawyers have told WIPR.

The Alice Corporation v CLS Bank ruling, issued yesterday, June 19, was expected to provide greater clarity on the patentability of such inventions, which has been debated since the dispute started in 2007.

In a unanimous verdict, all nine Supreme Court judges said that four of Alice’s patents, which protect software-implemented inventions, did not contain patentable subject matter.

Reacting to the case, George Beck, partner at Foley & Lardner LLP in Washington, DC, said the ruling “may not be limited” to the computer field and could arguably apply to other areas such as abstract ideas, natural phenomena or laws of nature.

“As the court’s decision recognises, most inventions involve some application of these concepts,” said Beck.

“Lower courts will likely need to address what other areas beyond those addressed in this case may be directed to patent-ineligible abstract ideas, natural phenomena and laws of nature.

“Further, the USPTO will likely consider guidelines that may make it more difficult to obtain patents for inventions that appear to be broadly drawn to these concepts,” Beck said.

The case started when CLS Bank, a provider of foreign exchange market software, had challenged attempts by Alice, an Australian organisation, to patent claims covering a computer system for electronic financial transactions.

The patents were deemed invalid, but the US Court of Appeals for the Federal Circuit reversed the decision and sent it for a re-hearing en banc (before all of its judges).

In May last year, the Federal Circuit’s seven judges agreed that Alice’s claims were patent-ineligible, but a majority of them could not agree on the legal rationale for that conclusion.

Alice then appealed to the Supreme Court, claiming that the legal standard governing whether computer-implemented inventions are patent-eligible remain “entirely unclear” and “utterly panel dependent”.

Although the case was primarily watched in the US, Mark Kenrick, patent attorney at Marks & Clerk LLP in the UK, said European companies may need to “reconsider their filing strategies” in light of the opinion.

“Strategies premised on the availability of US patents directed to relatively abstract business concepts may no longer be appropriate,” Kenrick said.

“Of course, a new judicial pronouncement like this in such a difficult area will cause some uncertainty until there is a body of decisions which makes clear how the law will be applied in practice,” he added.


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