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REFLECTIONS ON ALICE, or BUSINESS METHODS FALL DOWN THE RABBIT HOLE

So you think you have a new business idea that deserves a patent? The Supreme Court may say "not so much." Particularly if it pertains to an abstract idea programmed on a generic computer. Andrew H. Hirshfeld, Deputy Commissioner for Patent Examination Policy, has recently issued Preliminary Examination guidelines (edited content below) based on the Court's ruling in Alice Corporation Pty. Ltd. v. CLS Bank International, et al. ("Alice Corp.") decided June 19, 2014.

In a unanimous decision, the Supreme Court held that the patent claims disclosing a scheme for mitigating "settlement risk," are not eligible subject matter. "Settlement risk" is defined as the risk that only one party to an agreed-upon financial exchange will satisfy its obligation, in which a computer system is used as a third-party intermediary between the parties to the exchange. The patent claims are styled as a method for exchanging financial obligations, a computer system configured to carry out the method, and a computer-readable storage medium containing program code for causing a computer to perform the method.

The Court determined that Alice Corp.'s claims to methods were ineligible because "the claims at issue amount to 'nothing significantly more' than an instruction to apply the abstract idea of intermediated settlement using some unspecified, generic computer." Alice Corp.'s claims to computer systems and computer-readable storage media were held ineligible for substantially the same reasons, e.g., that the generically-recited computers in the claims add nothing of substance to the underlying abstract idea. Notably, Alice Corp. neither creates a per se excluded category of subject matter, such as software or business methods, nor imposes any special requirements for eligibility of software or business methods.

Examples of abstract ideas referenced in Alice Corp. include:

  • Fundamental economic practiced;
  • Certain methods of organizing human activities;
  • "An idea of itself and,
  • Mathematical relationships/formulas.

An idea may still qualify for patent protection if the claim amounts to significantly more than the abstract idea itself. In other words, do other limitations in the claim show a patent-eligible application of the abstract idea, e.g., more than a mere instruction to apply the abstract idea?

Limitations referenced in Alice Corp. that may be enough to qualify as "significantly more" when recited in a claim with an abstract idea include, as non-limiting or non-exclusive examples:

  • Improvements to another technology or technical field;
  • Improvements to the functioning of the computer itself; or
  • Meaningful limitations beyond generally linking the use of an abstract idea to a particular technological environment.
Categories: USPTO, Patent

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