Now that the US Court of Appeals has ruled that abstract processes, or business methods, cannot be patented, it is important to look at how this could affect the technology industry.
The case in question was rejected because the patent at issue was a process not tied to a 'machine', which is one standard for patentability.
Overall, it seems like a ruling that should favour companies that make hardware and software. The ruling narrows the types of patents that can be filed, but, in return, such companies should be protected from the frivolous patent suits that have flooded the industry in the past few years.
"We've seen a rise in the number of lawsuits against tech companies in the IT area specifically. Many are very questionable patents and the [US Patent and Trademark Office] is overwhelmed," said Jason Schultz, acting director of the Samuelson Law, Technology & Public Policy Clinic at the University of California, Berkeley.
"It will reduce the number of patent applications which are filed in the IT space, especially by these questionable entities or companies trying to patent trivial things," said Schultz.
"Trivial things" include broadly defined behaviours or obvious ideas, such as credit-card processes for e-commerce or shopping carts for websites. Some companies have attempted to patent such behaviours and ideas, which have more to do with a process and less to do with a machine.
One of the advantages of the US Court of Appeals' ruling is that "it allows the patent office to make quick and easy rejections, instead of deep, technical rejections, which are intense, substantive, analytical decisions", added Schultz.
In other words, the entire patenting process could be sped up because there may be fewer patents filed over time.
The not-for-profit Washington DC-based Computer & Communications Industry Association (CCIA) agreed the ruling would be a boon to the companies it represents.
"The Federal Circuit's opinion implicitly recognises that an out-of-control patent system was not promoting progress, but rather impeding it," said CCIA president Ed Black. "The standard articulated in this case should limit the outrageous business method and software patents that we have recently seen, without undermining the incentive to innovate in these areas."
Some technology companies worried that the ruling could go too far, but it does not appear to have happened. The ruling doesn't necessarily mean that more patents on higher-quality hardware or software will be rejected straight away, it will just require a little finesse. Most technology companies should be safe, as long as the process they are trying to patent is tied to a computer, which definitely counts as a machine, according to Brent Yamashita, partner in the patent litigation group for DLA Piper.
The decision "may be adverse for some business-method patents that already exist but, in most cases, a skilful patent attorney would still be able to get a patent for his or her client... by making sure the process being described is tied in with the actual machine or tangible, such as a computer," said Yamashita.
"There are already many patents drafted that way. In the future, practitioners just need to be careful to make sure they don't just describe a process in the abstract," he noted.
That means, instead of giving a broad description of a product — like listening to music from a remote device — they have to be much more specific and narrow about what they claim to have invented — for example, how the process of listening remotely is tied to a specific device or service.
"I think [the ruling] will be good for everybody," said Schultz.
