Software Patents: History And Strategies (Pt. I – History)

This is part one of a two part series. Part two focuses on current strategies for obtaining software patents. Read part two here.

1952-2010: Software Patents Historically (before Bilski and Alice)

For centuries in United States patent law, the question of patentability of the subject matter of an invention under 35 U.S.C. §101 was fairly cut-and-dry. Assuming the subject matter was new (under 35 U.S.C. §102) and not obvious (under 35 U.S.C. §103), the subject matter of a patent claim was patentable if:

The claim described a process, machine, manufacture, or composition of matter, AND The claim did not describe a law of nature, a natural phenomenon, or an abstract idea. While software-based inventions can typically be categorized as machines or processes or some combination of the two, the questions that has plagued courts, inventors, and patent practitioners alike for decades is - what qualifies as an "abstract idea" in the world of software, and which software-based inventions are disqualified as unpatentable as a result?

In passing the Patent Act of 1952, Congress attempted to explain the "abstract idea" question by noting that "Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law of gravity." Instead, patents were meant to protect "any thing under the sun that is made by man." MPEP 2105, citing S. Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952). This did not yet clarify the patentability of software, which had yet to move out of research laboratories by 1952, and which was both man-made and often reliant on mathematical or abstract principles in its execution.

In 1968, a few years after "minicomputers" the size of modern household kitchen refrigerators began gaining popularity, the US Patent Office (the precursor to the US Patent and Trademark Office) issued guidelines prohibiting the patenting of inventions using computer-made calculations. These were eventually challenged by the US Court of Customs and Patent Appeals, the precursor to the Federal Circuit. In the 1970s, the Supreme Court seemed to side with the Patent Office and expressly rejected two software patent applications for including little other than mathematics. Gottschalk v. Benson, 409 U.S. 63 (1972); Parker v. Flook, 437 U.S. 584 (1978).

Prospects for software patents looked grim until 1981, when the Supreme Court held that a software algorithm that guides a heating process for curing rubber was, in fact, patentable. Diamond v. Diehr, 450 U. S. 175 (1981). The Supreme Court concluded that the software algorithm of Diehr was not merely an abstract idea, throwing the software patentability question back into the forefront once again. The Supreme Court interfered little with the "abstract idea" software subject matter eligibility question for nearly three decades afterward, during which the Federal Circuit became increasingly lenient in allowing software patents before slowly beginning to pull back in the late 2000s.

2010-2014: The Supreme Court adds "Significantly More" to the Analysis with Alice

The Supreme Court finally returned its attention to the "abstract idea" question by affirming its importance in a narrow 2010 ruling rejecting a patent application directed to hedging energy investment risks, Bilski v. Kappos, 561 U.S. 593 (2010). In 2014, the Supreme Court modified the "abstract idea" subject matter eligibility rule by asserting that an abstract idea could, in fact, be patentable, so long as the patent application in question claims "significantly more" than the abstract idea, which the Court decided was not present in several patent...