Recent developments in the United States and China show positive signs for software patent values

The value of patents covering computer programs and related technologies has arguably been the hardest hit by recent legislative reforms, new jurisprudence and anti-IP sentiment. But those looking to buy, sell and license software patents have no reason to give up hope just yet.

When the US Supreme Court handed down its decision in Alice Corp v CLS Bank back in June 2014, many observers saw it as the death knell for software patents in the jurisdiction. Following the judgment, there was a substantial uptick in rejections, oppositions and post-grant challenges relating to applications covering computer programs.

Nevertheless, the question of software patentability remained from settled, with the US Court of Appeals for the Federal Circuit hearing and issuing opinions on a number of cases concerning computer program-related inventions. Writing a guest post on the IAM blog last week, Bart Eppenauer – someone at the coalface of software patenting as former chief patent counsel of Microsoft and currently a managing partner with Shook, Hardy & Bacon – suggested that the past six months have been the most critical in providing clarity on patent eligibility under Section 101 of the US patent statute, thanks to decisions including Enfish¸ BASCOM, Rapid Litigation and McRo.

For more detail, IAM subscribers can read Eppenauer’s article in full here. In sum, this is what he has to say on software patentability in the post-Alice landscape:

The clear takeaway is that software-related inventions are most assuredly patentable, when described and claimed properly.  Patent applicants will continue to see success if they file patents:

(1) with a specification that tells the story of the invention, including the advantages, technical benefit and practical application with as much technical detail as possible, and if the invention uses a computer, describing why that is important, specifically how it is done, and what technical improvement is provided; and

(2) with claims directed to a solution to a technological problem that incorporate specific elements demonstrating how the invention is implemented to achieve a technological improvement.  In other words, make it technical, make it specific, and describe and claim how to do it (rather than just what it will do).

Following this, last week the US Patent and Trademark Office (USPTO) issued a memorandum to its examiner corps offering further guidance on software patent applications in light of some of these Federal Circuit decisions. Its content appears to broadly concur with Eppenauer’s conclusion.

On the other side of the world, good news for businesses and inventors in the software industry has also emerged from China. The country’s State IP Office recently published new draft guidelines for patent examination, with the US Patent and Trademark Office’s senior counsel for China, Mark Cohen, pointing out that they “appear to loosen the standards for obtaining software enabled inventions”. Cohen reports that a section of the existing guidelines which asked applicants to describe “which parts of the computer program are to be performed and how to perform them” has now been amended to the following: “The components may not only include hardware, but may also include programs”.

That sounds like a fairly explicit thumbs-up for the patent eligibility of software in China. Combined with the direction being taken by the US courts, the outlook seems to have become a little brighter for software patent values.

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