Patenting of Computer Related Inventions: A Look at Bilsky and its Applicability in the Indian Scenario

• Author: Adithya Banavar
• Position: National Law School of India University, Bangalore, India adithyabanavar@nls.ac.in
• Pages: 90-98

This paper was originally published in Kierkegaard, A. (2009) Legal Discourse in Cyberlaw and Trade. IAITL-

Page 90

1. History of Patentability of Software in the USA

The issue that arises here is the interpretation of the word 'process' that appears in the United States Code in context of patents. 35 U.S.C. § 101 reads "Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title." 5 U.S.C. § 100(b) defines 'process' as meaning "process, art or method, and includes a new use of a known process, machine, manufacture, composition of matter, or material."¹ This definition is most unhelpful, especially given that in defining process, it uses the word process. In this Section, the journey of software as patentable subject matter is seen with respect to the Supreme Court of the United States ["SCOTUS"], The Court of Customs and Patent Appeals ["CCPA"] and the Court of Appeals for the Federal Circuit ["CAFC"] that was created by Congress in 1982 primarily to hear patent cases.

1. 1 Doctrines prior to Benson

1.1.1. Mental Steps and Functions of Machine Doctrines

Prior to the various SCOTUS decisions on the topic, the CCPA had taken the stand that processes involving mental operations were considered unpatentable. This was applied for any mathematical algorithm as well as any invention where the primary inventive component was a mathematical algorithm. This meant that no software process could possibly be patented.³ The 'function of a machine' doctrine is generally traced to a 19th Century Page 91 judgment of the Supreme Court of the United States.⁴ The Court stated in that case - "it is well settled that a man cannot have a patent for the function or abstract effect of a machine, but only for the machine which produces it."5 By two judgements in 1968,⁶ In Re Tarczy-Hornoch and In Re Prater, the CCPA did away with the above two doctrines stating that they were a misinterpretation of precedent.

1.1.2. Technological Arts Doctrine

In 1970,⁷ the CCPA stated that any sequence of operational steps was a patentable process so long as it was within 'technological arts' so as to be in consonance with the Constitutional mandate to promote the progress of useful arts. Article I, Section 8 states "The United States Congress shall have Power...To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries."

The case dealt with the patentability of a method of improving the delineation of geological subsurface formations by taking a series of seismograms from geographically separated stations by using a hyperbolic function to the family of seismograms produced by a particular arrangement of stations. The claim was rejected as the novelty lay in the mental process as opposed to the physical steps. The CCPA however, reversed and rejected the point of novelty approach followed by the patent office. On the point of novelty approach, if the novelty or advancement in the art claimed by the inventor resided solely in a step of the process embodying a mental operation or other unpatentable element, the claim was rejected under § 101 as being directed to nonstatutory subject matter. The Court relied on Prater to hold that the mental steps doctrine had been done away with and hence, the 'point of novelty' approach also lost its footing.

The 'technological arts' standard was refined in Re Benson,⁸ in which the court held that computers, regardless of the uses to which they are put, are within the technological arts for purposes of §101.

1.2. Gottschalk v Benson

This case related to the patentability of an algorithm to convert binary-coded decimal numbers ["BCD"] into purely binary numbers.⁹ The Court relied on Funk Bros. Seed Co. v. Kalo Co.,¹⁰ where it was held that newly discovered phenomena of nature could not be patented and extended the logic from a product patent to a process patent and included mental processes or abstract intellectual concepts as not patentable, simply because "they are the basic tools of scientific and technological work". Keeping this in mind, the Court took the stand that the conversion of BCD was too abstract to be patentable as it covered both known and unknown uses of the algorithm. In the reversal of the CCPA judgment, the Court did not refer to the new 'technological arts' doctrine or to the rejection of the 'mental steps' and 'functions of a machine' doctrines.

This decision has often been interpreted as a prohibition of all software patents across the board. This is perhaps supported by the statistics that show that in the decade that followed this judgement, virtually no one applied for a software patent.¹¹ While the judgement may have given that impression on first reading, all that the judgment states is that the phenomena of nature cannot be patented. The following observation perhaps led to this conclusion - "The mathematical formula involved here has no substantial practical application except in connection with a digital computer, which means that if the judgment below is affirmed, the patent would wholly pre-empt the mathematical formula and in practical effect would be a patent on the algorithm itself." The judgment also stated in conclusion that "[i]t may be that the patent laws should be extended to cover these programs, a policy matter to which we are not competent to speak. The President's Commission on the Patent System rejected the proposal that these programs be patentable." As explained in the judgment itself, the Commission report advocated the rejection of software patents as it believed that the patent office lacked a reliable classification as well as a searching technique and hence could not examine applications.

The number systems and conversion techniques have certain innate characteristics and properties that cannot be changed, but merely discovered. No patent is possible on such abstract concepts. If limited to the facts of the case, this is the possible understanding of the judgement. The judgement stated that "It is said that the Page 92 decision precludes a patent for any program servicing a computer. We do not so hold." However, if one was to look merely at the words of the opinion, it seems that the Supreme Court was indeed saying later that patents could not be obtained for computer programmes. "If these programs are to be patentable, considerable problems are raised which only committees of Congress can manage, for broad powers of investigation are needed, including hearings which canvass the wide variety of views which those operating in this field entertain. The technological problems tendered in the many briefs before us indicate to us that considered action by the Congress is needed."

It is interesting to note that after looking through all the precedent on process patents, the Supreme Court rejected the argument that a process patent must either be "tied to a particular machine or apparatus or must operate to change articles or materials to a 'different state or thing.'" The Court opined that they were not limiting the process patent only to these two conditions.

1.3. Interpretation of Benson

1.3.1. Point of Novelty Approach

The CCPA resurrected this approach post Benson and held that a process claim in which the only novel part was a mathematical equation to be solved as the final step of the process was not patentable.¹² This approach was, however, short lived and the CCPA sought to narrow the interpretation of Benson with each new case that came before it.

1.3.2. Apparatus/Process Distinction

In 1974, the CCPA held that Benson applied only to process claims and not to apparatus claims. The case related to a recordkeeping system that involved a digital computer with a programme.¹³ In dissent, Judge Rich stated that limiting Benson to process claims would make the question of patentability turn on the form or means in which the program invention was claimed as opposed to the substance of the claim. In 1976, again, the CCPA upheld the earlier judgment and based its decision on the reasoning that a computer with a programme is structurally different from the same computer. Judge Rich found himself in dissent again, this time joined by Judge Lane, who both felt that Benson had barred the patent of computer programmes across the board. The case related to an apparatus for scanning and converting data signals. Benson was distinguished by stating that this case related to a specific purpose and operated in relation to a particular technology as opposed to a 'phenomena of nature'.¹⁴

1.4. Parker v Flook

Six years after Benson, a question arose as to whether the "identification of a limited category of useful, though conventional, post-solution applications of such a formula" makes patentable a mathematical formula not otherwise patentable (as under Benson).¹⁵ The patent related to an algorithm that updated 'alarm limits'...