A progression of court decisions over the last decade, including from the United States Supreme Court, virtually eliminated patents on most software, business methods, medical testing and diagnosis innovations. For example, with respect to software-related innovations, if they (1) did not improve the functioning of computers (e.g. make them run faster) or (2) improve some other technology (e.g. make a robot move better), they were considered “ineligible” for patenting. Not only were patent applications denied on this basis alone, many granted patents were invalidated. Despite much of these ideas clearly involving high technology, patenting has been denied.
Congress is considering legislation that would help. The legislation would keep intact the broad set of things that can be patented: machines, articles of manufacture (products), chemicals, processes, and improvements of them. But it would seek to explicitly narrow what could be labelled ineligible to the following list:
- Fundamental scientific principles;
- Products that exist solely and exclusively in nature;
- Pure mathematical formulas;
- Economic or commercial principles;
- Purely mental activities.
Recognizing that this list alone might be difficult to apply, the legislation also includes the following concepts to try to make sure it is narrowly applied:
- Include a “practical application” test to ensure that the list is construed narrowly (in other words, patent claims that give a “practical application” to economical or commercial principles are not automatically deemed ineligible).
- Specifically overrule prior court decisions in favor of the list.
- Force the U.S. Patent Office and the Courts to determine eligibility by considering the patent claims “as a whole”, and not clause-by-clause.
- Forbid allowing other patentability considerations like novelty and non-obviousness to be taken into account.
To be fair, many stakeholders believed that patent eligibility was too broad and applauded the current state of the law. They argued that merely using computers for their normal function (processing data), is not the type of technology that deserves a 20-year exclusive right.
However, there has been widespread (and growing) acknowledgment that the current state of the law may have swung too much the other way. For a good number of years now, it is rare that any patent claim that centers on computer processing is allowed or withstands court challenge.
During this time, it has been difficult to advise clients to file these types of patent applications. However, in this same time period, the U.S. changed from a “first-to-invent” patent system to a “first-to-file” system. Because of that, we have also had to advise clients that they should at least consider filing patent applications on these types of inventions that have high potential value because action by Congress could bring them back into play.
We do not know the likelihood of this legislation passing, but it gives some hope to continuously evaluate with your patent attorney whether filing makes sense.