Patents for “Real Inventions with Computers”?: The High Court Hears Arguments in CLS Bank Case

bethShaw-0580editConvertedProfile-e1360002102239Featured Expert Column — Patent Law

Beth Z. Shaw, Brake Hughes Bellermann LLP

On Monday, March 31, the Supreme Court heard argument in the much anticipated patent case Alice Corporation v. CLS Bank International. The arguments focused on the scope of application of Section 101 to claims for a patent related to computer data processing. In a previous divided opinion, the U.S. Court of Appeals for the Federal Circuit failed to agree on any standard as to why the computer-related patent claims were not patent eligible.

Justice Breyer, who questioned the parties more than any other justice, asked the Petitioner how the process claims at issue were different from King Tut applying calculations using an abacus. He queried how to come to a result that might have broader policy implications. Justice Breyer appeared to struggle with the idea of allowing a broad rule that might result in “competition on who has the best patent lawyer,” yet also expressed concern about ruling out “real inventions with computers.”

Justice Sotomayor asked if the Petitioners are “trying to revive the patenting of a function.” She also questioned whether the medium, system, and method claims stand or fall together, an issue that has plagued the divided Federal Circuit for some time. Justice Sotomayor wondered, however, if the Court actually needs to “announce a general rule with respect to software” to resolve this case.

The Petitioners argued that Congress intended the courts apply Section 102 to invalidate patents based on novelty, yet continue a liberal interpretation of Section 101. Justice Ginsburg seemed reluctant to accept that line of reasoning, stating that there are “four Justices” who don’t “buy that argument.” Justice Scalia noted, however, that “four is not five.” Justice Scalia’s questions suggest that he believes that a Section 101 patent-eligibility question should not be confused with the question of whether an invention is novel based on prior art.

Focusing on the practical application of the law by judges, Justice Kagan asked, “[w]hat do we want a judge to do at this threshold level in terms of trying to figure out whether the description is sufficient to get you past [101]?”

It appears that at least some of the justices may prefer to invalidate the patent here without reaching a broader question of when computer-related inventions should be patent-eligible. There also appear to be a group of justices, including Justice Scalia, who want to more clearly differentiate between the question of novelty and the question of an “abstract idea” as defined by previous case law applying Section 101. The questions from the oral argument at the Supreme Court reflect a philosophical debate and potentially divided Court, which could result in a decision with multiple opinions, not unlike that of the Federal Circuit in this case.

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