Slowing the Patent Trolls

Slowing the Patent Trolls

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By ROBIN FELDMAN

SAN FRANCISCO — ON Monday the Supreme Court is scheduled to hear arguments in perhaps the most important intellectual property case in a decade: Alice v. CLS Bank. Narrowly speaking, the case is a patent dispute over computerized escrow accounts. But more broadly, it offers the court an opportunity to resolve two decades of economically harmful confusion over how the law grants patent protection to computer software.

Since the mid-1990s the software patent system has operated by its own rules. Compared with patents for other innovations, those for software are granted using a very broad and lax standard of invention. Ordinarily, the law requires inventors to explain not just the result of an invention, but also how the invention actually works. If you invent a car that drives on water, you have to explain exactly how you get it to stay afloat. Not so for software: the mere idea of a floating car is enough.

The consequences of this lax standard have been disastrous. Because software patents can cover vast areas of territory, they are the weapon of choice for “patent trolls”: people or companies that hold patents but make no products, and bring patent-infringement lawsuits against companies that do make products, offering to settle for less than the cost of fighting the suit. Patent trolling is an extraordinarily lucrative but singularly destructive practice. A majority of patent lawsuits are now filed by parties using this strategy.

How did the law arrive at such a misguided approach to software patents? In short, through a simple misunderstanding about the nature of computer code.

The Supreme Court first addressed the patentability of code in the 1970s, but the cases involved software that was integrated into hardware, like a computerized device for curing rubber. The court treated such patents by focusing on the industrial applications of the machines in which the code was embedded — not on the code itself.

But by the 1990s, lower courts had to consider the patentability of pure software, things like Adobe Acrobat that are not hard-wired into a machine. Software inventions were becoming an integral part of the industrial landscape, and denying patents on them was unthinkable. But to lower court judges, there seemed to be a problem: At first blush, pure software looks like a mathematical formula, the sort of thing used to express a law of nature. Patent law, however, has long excluded from protection discoveries like the Pythagorean theorem or E = mc2. If such formulas are unpatentable, how can a computer program ever be patentable?

This reasoning flowed from a basic confusion between the content of a statement and the language in which it is expressed. Expressing something in formulaic language does not necessarily mean that what is being expressed is a law of nature. Formulaic language can be used to express the content of anything from cosmic inflation theory to comic books.

Nonetheless, the lower courts embraced this flawed reasoning. And to avoid the appearance of patenting mathematical formulas, they blessed an approach to software patenting that merely described, in simple English prose, what the invention did. Thus did we end up with our dysfunctional arrangement.

Alice v. CLS Bank presents the Supreme Court with a chance to put the system back on track. (I have filed an amicus brief, on behalf of neither party.) So how should we determine what constitutes patentable software? By asking whether the patent is appropriately aimed at a specific commercial application rather than a broad concept.

Suppose you create a software program to assess the riskiness of a driver for car-insurance purposes, and your idea is to assess that risk based on how much the person texts while driving, combined with other risk indicators. Under the current software patenting paradigm, providing the description above without much more could be enough to merit protection. But this is far too broad: Your idea that someone who sends a lot of text messages while driving is likely to be a risky driver is just a general concept (and perhaps even a law of nature).

By contrast, under an improved paradigm, you could patent only a far more limited and specific invention. You would have to specify the particular inputs used — texting frequency, credit score, hobbies, driving history — along with the weights and multipliers and software approach used to produce the risk score.

Patent trolling is a multidimensional problem, and it will take efforts on many levels to bring it under control. But an effective decision by the Supreme Court, ensuring that software patents meet the same level of rigor as other patents, would be an important contribution to stemming the tide.

Robin Feldman is a professor at the University of California Hastings College of the Law.