BUSINESS

Could Court's Decision End Software Patenting?

12/01/2008 05:12 am ET | Updated May 25, 2011

A major decision this may have determined that software is no longer patentable. If true, this would change the landscape of tech business. In re Bilski strikes down "business method" patents like Amazon.com's 1-click, says Silicon Alley Insider.

Gene Quinn, a patent attorney, posted a lengthy diatribe on the ruling in which he says the court decided software patents could no longer exist:

In the In re Bilski decision issued by the Federal Circuit today the court choose to overrule the famous State Street decision that allowed business method patents to become popular, but they also unceremoniously rules that software and other electronic devices are not patentable subject matter.

But it seems there are many interpretations. A far less drastic one is that patent lawyers need only rearrange the way in which they apply for software patents:

Some tech companies worried the ruling could go too far, but it doesn't appear that's what happened. It doesn't necessarily mean that more patents on higher-quality hardware or software will be rejected right away, it will just require a little finesse. Most tech companies should be safe, as long as the process they're trying to patent it tied to a computer, which definitely counts as a machine, according to Brent Yamashita, partner in the patent litigation group for DLA Piper.

The decision "may be adverse for some business method patents that already exist, but in most cases a skillful patent attorney would be able to still get a patent for his or her client...by making sure the process being described is tied in with the actual machine or tangible such as a computer," said Yamashita.

Earlier in the year, Fortune's Roger Parloff wrote on the subject of ending software patents and a movement's reasons for wanting to:

Though the project is being sponsored and funded by leaders of the Free and Open Source Software movement, it hopes to attract support from the wider community of businesses, financial institutions and universities that have all been blindsided in recent years by lawsuits over software patents and their close-cousins, business-method patents.

...

The point, explains Klemens, is this: "If you're running a business of any sort, you have to care about the software and business method patents." That's because nearly every business today operates a Web site and employs a staff of in-house IT programmers who enable them to conduct business in the digital age. In that sense, every business is now a software business.

SOURCE MATERIALS:

::The 132-page In re Bilski decision [PDF]

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