Last week, 31 March, the US Supreme Court heard oral argument on the question whether Alice Corporation can patent its software system for a method of payment: Alice Corporation Pty. Ltd. v. CLS Bank International, Supreme Court Docket No 13-298 (2014).

Several patents and claims are in issue, all relating to a computerized trading platform used for conducting financial transactions in which a third party settles obligations between a first and a second party so as to eliminate “counterparty” or “settlement” risk. What might be considered an “escrow” arrangement using computers.

The question presented:

Whether claims to computer-implemented inventions-including claims to systems and machines, processes, and items of manufacture-are directed to patent-eligible subject matter within the meaning of 35 U.S.C. § 101 as interpreted by this Court?

The issue is whether what Alice Corporation is claiming is even patent-eligible subject matter (let alone new or inventive). In Australia, the corresponding question is whether what is claimed is “a manner of manufacture“.

In 1997, the US Federal Circuit substantially expanded what could be patented in its State Street ruling allowing the patenting of business methods. In the decision under appeal, however, the  10 judges of the Federal Circuit famously came up with 7 different conflicting opinions to deny Alice Corporation’s patent. The Supreme Court was forced to intervene to try to introduce some certainty. A decision is expected in June.

You can read the transcript of the oral arguments here. Some extracts here. You can also find the parties’ more detailed, written arguments and those of the many amici via the links here. Wired UK has an good overview here.

In Australia, the State Street decision had proved influential both in the Courts and in Government reviews. However, the Federal Court recently reached what were arguably conflicting decisions too. We await the Full Federal Court’s ruling in the Research Affiliates appeal and RPL Central.