At issue in the case, Alice Corp. v. CLS Bank International: Do software inventions get the same kind of patent protections as other inventions?
The justices, in their decision, upheld a lower court ruling that invalidated Alice Corp.’s patents, which were challenged by CLS International. But, as SCOTUSblog notes: “[T]he Supreme Court leaves room for software patents, just not those that take an abstract idea and provide for a computer to implement it.”
The Associated Press reports:
“The justices ruled unanimously that the government should not have issued a patent to Alice Corp. in the 1990s because the company simply took an abstract idea that has been around for years and programmed it to run through a computer.
“The decision makes clear that to obtain a patent, a company’s idea must actually improve how a computer functions or make other technical advancements.”
And here’s more from SCOTUSblog on the impact of the decision: “The case is more of a stepping stone than pathbreaking.”
Technology companies like Google and Facebook were closely watching the case and had urged clearer rules for software patents.
NPR’s Laura Sydell reported last month on the case, providing some background:
“Alice Corp. owns patents on a process of verifying payment on a computer. The company says it’s a special method. Alice Corp. is what is called a nonpracticing entity — known pejoratively as a ‘patent troll.’ ”
“They don’t in fact sell a software or a program,” Mark Lemley, a law professor at Stanford University, told Laura.
He said Alice Corp. claims it has a patent on using a computer to confirm a financial transaction and says anyone using a computer process to do this should pay the company a fee. That’s what CLS Bank, which settles foreign exchange transactions, had challenged. On Thursday, the court sided with CLS.