Software patent debate

Source: Wikipedia, the free encyclopedia.
For general information on software patents, see software patent.

Computer programs, software and patent law
Topics
Treaties
Countries
Case law
Related topics

The software patent debate is the argument about the extent to which, as a matter of public policy, it should be possible to patent software and computer-implemented inventions. Policy debate on software patents has been active for years.[1] The opponents to software patents have gained more visibility with fewer resources through the years than their pro-patent opponents.[2] Arguments and critiques have been focused mostly on the economic consequences of software patents.

One aspect of the debate has focused on the proposed European Union directive on the patentability of computer-implemented inventions, also known as the "CII Directive" or the "Software Patent Directive," which was ultimately rejected by the EU Parliament in July 2005.

Arguments for patentability

There are several arguments commonly given in defense of software patents or defense of the patentability of computer-implemented inventions.

Public disclosure

  • Through public disclosure, patents encourage the open sharing of information and additional transparency about legal exposure.[3]
  • Through public disclosure, patents encourage the transfer of
    mechanical technology, which may apply more broadly.[3]

Economic benefit

Encouragement of innovation

  • The ability to patent new software developed as a result of research encourages investment in software-related research by increasing the potential return of investment of said research.[6]

Copyright limitations

Main article:
Copyright infringement of software

Patents protect functionality. Copyright on the other hand only protects expression. Substantial modification to an original work, even if it performs the same function, would not be prevented by copyright. To prove copyright infringement also requires the additional hurdle of proving copying, which is not necessary for patent infringement.

Copyright law protects unique expressions, while patent law protects inventions, which in the case of software, are algorithms; copyright cannot protect a novel means of accomplishing a function, merely the syntax of one such means.[7]

This means that patents incentivize projects that are unique and innovative in functionality rather than simply form. Copyrights, in turn, only incentivize uniqueness in form.[8]

Protection for small companies

Software patents can afford smaller companies market protection by preventing larger companies from stealing work done by a smaller organization, leveraging their greater resources to go to market before the smaller company can.[9]

Hardware patents analogy

Hardware and software are sometimes interchangeable. If people can patent hardware, then ideas describing software implemented by that hardware should also be patentable.[10]

Arguments against patentability

Opponents of software patents argue that:

Software is math

A program is the transcription of an

Church-Turing thesis, a program is thus the transcription of a mathematical function. Math is not patentable. Therefore, neither is software.[11]

Software encourages patent thickets

A patent thicket is a dense web of patents that companies must decipher to develop new technology. There are various types of patent thickets such as when a single innovation is protected by multiple patent holders or when a product is covered by numerous patents. The consequences of patent thickets are increased difficulty of innovation, complex cross-licensing relations between companies, and discouragement of newcomers from entering the software industry.[12]

Hinders research and development

  • Some scientific studies and expert reviews have concluded that patent systems paradoxically hinder technological progress
    anti-trust laws.[14]
  • Gary Becker, Nobel Prize–winning economist, argues, "Their exclusion from the patent system would discourage some software innovations, but the saving from litigation costs over disputed patent rights would more than compensate the economy for that cost."[15]

Hinders innovation

  • The Electronic Frontier Foundation published the Defend Innovation whitepaper after doing two and a half years of research on software patents. They concluded that many overbroad software patents are being awarded, which is actually stifling innovation.[16]
  • Interoperability is thought to promote innovation, and patent systems have the potential to block the development of such technologies.[17]
  • There has been a lack of empirical evidence to suggest that patents have any positive effect on innovation, and furthermore, the system primarily “encourage[s] failing monopolists to inhibit competition by blocking innovation.”[18]

Cost and loss of R&D funds

Copyright

Software is different

See also: artificial scarcity
  • Software programs are different from other electromechanical devices because they are designed solely in terms of their function. The inventor of a typical electromechanical device must design new physical features to qualify for a patent. On the other hand, a software developer need only design new functions to create a working embodiment of the program.[22]
  • Software is a component of a machine. The computer’s hardware is generic; it performs functions that are common to all of the software that is capable of being executed on the computer. Each software program that is capable of executing on the computer is a component of the computer.[22]
  • Computers "design" and build the structure of executable software. Thus, software developers do not design the executable software's physical structure because they merely provide the functional terms.[22]

Trivial patents

  • Anecdotal evidence suggests that some software patents cover either trivial inventions or inventions that would have been obvious to persons of ordinary skill in the art at the time the invention was made.[23]
  • Patent examiners rarely have a comprehensive knowledge of the specific technologies disclosed in the patent applications they examine. This is in large part due to the enormous number of micro-niches in the software field and the very limited number of hours (often less than 8 h per patent) available to examiners to review patent applications. So, patents are sometimes allowed on inventions that appear to be trivial extensions of existing technologies.[24]

Open source disadvantage

Main article: Software patents and free software
  • The free and open source software community, and many companies that use and contribute to open source oppose software patents because they can impede or prohibit the distribution of free software. They contend that patents threaten to undermine FLOSS, regardless of innovations produced by FLOSS collaborations.

Software patents' usefulness as an information source is limited

  • Some patent disclosures in the software field are not readable to some programmers; as a result, patents are rarely used as a source of technical information by software developers.[25]

Long patent pendencies

Patent trolls

Disproportionately harms startups

  • Patent assertion entities (
    patent trolls) disproportionately affect startups, which are important for job creation and innovation. Companies with less than $100M annual revenue represent two-thirds of unique defendants in troll suits. A large percentage of startups reported that being sued by trolls resulted in significant operational impact.[32]

U.S. Supreme Court decisions

Several

Mayo v. Prometheus to computer-related inventions in which a computer was used to implement an abstract principle or preexisting business practice. See also Software patents under United States patent law
.

Bilski case

The Bilski case involved a patent application on methods for hedging against commodity price fluctuations, which the PTO had rejected. The Federal Circuit, in In re Bilski, upheld the PTO's rejection on the grounds that the claims failed the machine-or-transformation test, which the court held should be used as the sole test of patent eligibility. The court did not hold that all business methods are patent ineligible, though a minority of the judges would have ruled that business methods are not properly the subject of patents.

The Supreme Court affirmed the judgment of ineligibility, in

State Street Bank
decision, which allowed patents on any advance, technical or nontechnical (and in that case a numerical financial calculation of stock price changes) that produces a "useful, concrete and tangible result."

The Supreme Court's Bilski decision was criticized because of its lack of detailed guidance on how to determine whether a claim was directed to an abstract idea. Nonetheless, it provided some clarification and affirmed the Federal Circuit's taking a new direction in its software-related patent cases.

Mayo case

In

Neilson
cases, which is to treat the underlying principle, idea, or algorithm on which the claimed patent is based as if it were part of the prior art and to make patent eligibility turn on whether the implementation of it is inventive. This led to the "two-step" Alice test described next.

Alice case

At the time the Mayo case was decided, there was some uncertainty over whether it applied only to natural principles (laws of nature) or more generally to patent eligibility of all abstract ideas and general principles, including those involved in software patents. The Alice decision confirmed that the test was general. The Alice case involved patents on electronic methods and computer programs for financial-trading systems on which trades between two parties who are to exchange payment are settled by a third party in ways that reduce the risk that one party performs while the other does not. The patents cover what amounts to a computerized escrow arrangement.

The Court held that Mayo explained how to address the problem of determining whether a patent claimed an unpatentable abstract idea or instead a potentially patentable practical implementation of an idea. This requires using a "two-step" analysis.

In the first step, the court must determine whether the patent claim under examination contains an abstract idea, such as an algorithm, method of computation, a Law of Nature or other general principle. If not, the claim is potentially patentable, subject to the other requirements of the patent code. If the answer is affirmative, the court must proceed to the next step.

In the second step of the analysis, the court must determine whether the patent adds to the idea "something extra" that embodies an "inventive concept." If there is no addition of an inventive element to the underlying abstract idea, the court finds the patent invalid under section 101. This means that the implementation of the idea must not be conventional or obvious to qualify for a patent. Ordinary and customary use of a general-purpose digital computer is insufficient; the Court said—"merely requiring generic computer implementation fails to transform [an] abstract idea into a patent-eligible invention."

The ruling continued with these points:

  • A mere instruction to implement an abstract idea on a computer "cannot impart patent eligibility."
  • "[T]he mere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention."
  • "Stating an abstract idea 'while adding the words "apply it"' is not enough for patent eligibility."
  • "Nor is limiting the use of an abstract idea to a particular technological environment."

The Alice decision met a mixed reception, but profoundly affected U.S. patent law. In its wake, as explained in the

Wikipedia article on the case, courts invalidated vast numbers of so-called software and business-method patents (the overwhelming majority of those the United States Court of Appeals for the Federal Circuit considered) and the number of such patents issued has drastically fallen. The Alice decision has been widely criticized for its failure to specify in detail the boundaries of patent eligibility, but it has also been defended because its unanimity tends to stabilize decisional law in the field.[33]

Subsequent developments

After Alice, the Federal Circuit and district courts invalidated large numbers of business-method and software patents based on those courts' interpretations of Alice. Federal Circuit Judge William Bryson summed this up in these terms:

In short, such patents, although frequently dressed up in the argot of invention, simply describe a problem, announce purely functional steps that purport to solve the problem, and recite standard computer operations to perform some of those steps. The principal flaw in these patents is that they do not contain an “inventive concept” that solves practical problems and ensures that the patent is directed to something “significantly more than” the ineligible abstract idea itself. [Citing Alice and Mayo.] As such, they represent little more than functional descriptions of objectives, rather than inventive solutions. In addition, because they describe the claimed methods in functional terms, they preempt any subsequent specific solutions to the problem at issue. [Citing Alice and Mayo.] It is for those reasons that the Supreme Court has characterized such patents as claiming “abstract ideas” and has held that they are not directed to patentable subject matter. [34]

See also

References

  1. ISBN 1-56720-140-7
    .
  2. ISBN 952-91-8779-3
    .
  3. ^
    ISSN 0895-3309
    .
  4. ^ "Ways in Which Patents can Help Your E-Commerce Business". World International Property Organization. Archived from the original on October 15, 2007. Retrieved June 19, 2008.
  5. doi:10.1016/s0048-7333(02)00078-1
    .
  6. ISSN 0099-9660
    . Retrieved March 29, 2017.
  7. ^ "Experts Debate Constitutionality Of Software Copyrights". Retrieved March 28, 2017.
  8. ^ "Software Myths and Facts". Retrieved March 29, 2017.
  9. ^ Shaw, Steven. "Why we need software patents, and yes, I'm smarter than you | ZDNet". ZDNet. Retrieved March 29, 2017.
  10. ^ "Should Patents Be Awarded to Software?". Retrieved March 28, 2017.
  11. ^ Pamela Jones, An Explanation of Computation Theory for Lawyers.
  12. doi:10.1093/jiplp/jpi046
    .
  13. ISBN 978-0-691-11725-6
  14. JSTOR 1821293
    .
  15. ^ Lee, Timothy B. (July 31, 2013). "Here's why economists hate software patents". The Washington Post. Retrieved August 31, 2016.
  16. ^ "EFF Outlines Plan to Fix the Broken Patent System". Electronic Frontier Foundation. February 23, 2015.
  17. ^ Samuelson, Pamela (2008). "Are Patents on Interfaces Impeding Interoperability". Berkeley Law – via Berkeley Law Scholarship Repository.
  18. ISSN 0895-3309
    .
  19. ^ Mulligan, Christina and Lee, Timothy B., Scaling the Patent System (March 6, 2012). NYU Annual Survey of American Law, Forthcoming. Available at SSRN: http://ssrn.com/abstract=2016968
  20. ^ "Patent medicine - Why America's patent system needs to be reformed, and how to do it". Economist. August 20, 2011. Retrieved September 26, 2011.
  21. ^ "The Basics". NoSoftwarePatents.com. Retrieved June 19, 2008.
  22. ^
    ISBN 0-7803-7284-0
    .
  23. ISBN 978-0-691-13491-8
    : "(...) many people have focused solely on patent examination quality as the objective of reform, based largely on anecdotal evidence of trivial, obvious, or otherwise invalid patents. Although we support efforts to improve patent examination quality (large numbers of questionable patents create conditions in which poor patent notice is unavoidable), our analysis suggests that this is only part of the problem and the patent system cannot likely be fixed by addressing only this issue. Of course, the notice problems that we find central to the poor performance of the patent system are not the only ones looking for a remedy. We argue, however, that many proposed reforms, including reforms directed toward improving patent examination quality, are unlikely to be effective unless patent notice is improved generally".
  24. ISBN 978-0-691-13491-8
    : "It is possible, however, that features of software technology make it particularly susceptible to the patenting of obvious ideas, especially given the legal doctrines of non-obviousness developed by the Federal Circuit. For one thing, the general-purpose nature of software technology—again, because the technology is abstract, similar techniques can be used in a wide range of applications— makes it inevitable that techniques known in one realm might be applied in another, yet the documentary evidence that the Federal Circuit requires for a demonstration of obviousness might not be published."
  25. ^ "Software patents need shelter from the storm". ZDNet - Tech News.
  26. ^ To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy A Report by the Federal Trade Commission (PDF). Federal Trade Commission. October 2003.
  27. ^ a b "United States Patent and Trademark Office". USPTO. Archived from the original on June 30, 2023. Retrieved July 1, 2023.
  28. ^ "IP5 Statistics Report 2015" (PDF). IP5.
  29. ^ Lapowsky, Issie. "EFF: If You Want to Fix Software Patents, Eliminate Software Patents". Wired. Retrieved April 26, 2017.
  30. ^ "2016 Patent Litigation Study: Are we at an inflection point?". PwC. May 2016. Archived from the original on September 26, 2016.
  31. ^ a b Bessen, James; Ford, Jennifer; Meurer, Michael J. (Winter 2011–2012). "The Private and Social Costs of Patent Trolls" (PDF). Regulation. Cato Institute. Archived (PDF) from the original on March 2, 2022. Retrieved December 20, 2022.
  32. ^ Chien, Colleen (January 1, 2014). "Startups and Patent Trolls" (PDF). Stanford Technology Law Review. 17 (1). Archived from the original (PDF) on September 12, 2017.
  33. ^ Richard H. Stern, Alice v CLS Bank: US Business Method and Software Patents Marching towards Oblivion?, [2014] Eur. Intell. Prop. Rev. 619, 629.
  34. ^ Loyalty Conversion Sys. Corp. v. American Airlines, Inc..
Retrieved from "https://en.wikipedia.org/w/index.php?title=Software_patent_debate&oldid=1207716141"