Can you patent software in the United States?

Patents are intended to help inventors and society in general. Patents grant inventors the exclusive right to sell their invention for a limited period of time and in exchange for that exclusive right the inventor describes how the invention works to the general public. The patent laws in the United States were written before computers were considered common appliances. Because of this the patent law in the United States does not explicitly address the question whether or not computer software can be patented. Generally, in the United States, when the law does not address a question it is up to the courts to craft rules to answer the question.

In the case of software patents, the court made rules allow software patents under limited circumstances.

It is important to remember that only the federal courts in the United States deal with patents, state courts cannot hear patent cases, so that makes the number of cases you need to read less burdensome.

In the 1960s when computers first became more affordable and more companies began buying them, the United States Patent and Trademark Office would frequently deny patent applications that dealt with computer software. The patent applicant would then appeal the United States Patent and Trademark Office’s denial to a court and the court would frequently order the patent application to be granted. Before 1982 the court which would hear United States Patent and Trademark Office appeals was United States Court of Customs and Patent Appeals, that court was abolished and replaced by the United States Court of Appeals for the Federal Circuit. The United States Patent and Trademark Office then might appeal the court’s order to the United States Supreme Court. The Supreme Court cases are key to understanding the when software is eligible for patent protection.

Gottschalk v. Benson, 409 U.S. 63 (1972) – The Supreme Court’s ruling denied a patent on an algorithm for converting binary-coded decimal numbers into pure binary numbers. The court reasoned that abstract ideas could not be made the subject of patents.

Parker v. Flook, 437 U.S. 584 (1978) – The Supreme Court’s ruling denied a patent on an algorithm that use a weight average to set temperature limits in a reactor. The court held that for the implementation of an abstract idea or law of nature to be eligible for a patent the implementation must be inventive, rather than routine or conventional.

Diamond v. Diehr, 450 U.S. 175 (1981) – The Supreme Court’s ruling granted a patent on a machine that used an algorithm to control the curing of rubber. The court held that the implementation of the algorithm to control a machine was inventive.

For about 35 years the Supreme Court did not issue a decision that dealt with software patents and the Federal Circuit broadened the definition of what could be patented. There are a number of cases worth reading in this time but for the sake of clarity they have been omitted.

Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. __, 134 S. Ct. 2347 (2014) – The Supreme Court’s ruling denied a patent on an escrow service for financial transactions. The court did not hold that all software patents are ineligible, instead the court held that implementing abstract ideas on a computer was not enough to transform the abstract idea into subject matter which can be patented.

Since the Alice decision the United States Patent Office and the Federal Circuit have used a two step analysis to determine if a software related invention is eligible for a patent. First, the court determines whether the claimed invention is based on an abstract idea or principle. If the invention is directed to an abstract idea, the court determines whether the patent adds “something extra” to the idea that embodies an “inventive concept.” If there is no addition of an inventive element to the underlying abstract idea, the court will find the ineligible for a patent.

Because of these recent court cases it is now much more difficult to get a software patent today than it was in the past. If you are thinking about applying for a software patent or you have questions about a software patent that has been granted it is best to consult with an experienced patent attorney.

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