CLS Bank v. Alice Corp. Patent Infringement Case

In a patent case that may have far-reaching implications, a Federal Circuit court has ruled that Alice Corporation’s claim to have patented a computerized system is unfounded because the software is ineligible to be patented.

The case raised a number of questions, resulting in seven written decisions among the ten-member judicial panel. While not agreeing on any one opinion, seven of the judges concurred “that the method and computer-readable medium claims lack subject matter eligibility.” That was the extent of the agreement, as the justices were divided over what approach would prove suitable as a pattern for granting future patent claims in the information technology field.

As summarized by the linked article above, five members of the panel concurred with three grounding points codified by Judge Lourie. They are:

1. Patents must not be used to stifle creativity and discovery. They must embody more than an abstract idea or natural process, and they must not infringe on future applications of the patented process.

2. The protocols established for granting patents must not become so rote and predictable that they can be “gamed” by opportunity-seekers who do not exert genuine creativity.

3. The patent-review process must retain flexibility and open-mindedness to judge unknown future patents on individual merits.

The bulk of Alice Corporation’s patent claim lay in the “abstract idea” of a third party’s acting as an intermediary between two transactional parties to insure that the requirements of both are met before allowing their interaction to be fulfilled. Since abstract ideas are ineligible for patenting, the judges then had to consider whether the remainder of the patent added significantly more. Five of the judges decided that it did not, so Alice Corporation’s claim was denied.

It will be interesting to see how this decision comes to play in future technological patent cases. Keep abreast of patent news with Inventia Patent Drafting. For professional design assistance, please contact us today.

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