Deciding Whether Your Software Is Patentable

Is computer software patentable?

The short answer is “yes, but.”

The answer is “yes” because (as of 2015) about half a million patents had been issued in the 23 classes of patents covering “computer implemented inventions.”

The first US software patents were granted in the early 1970s. In 1981, the US Supreme Court held in Diamond v. Diehr that "a claim drawn to subject matter otherwise statutory does not become nonstatutory [i.e., not patentable] simply because it uses a mathematical formula, computer program, or digital computer."

In the Diehr case, a patent wasn’t being sought for the software as a stand-alone, but as part of a process for molding raw, uncured synthetic rubber that included the use of the software.

The Court held that a claim is patentable if it contains "a mathematical formula [and] implements or applies the formula in a structure or process which, when considered as a whole, is performing a function which the patent laws were designed to protect."

The Supreme Court explained its reasoning in Diehr in the 2014 case of Alice Corp. v. CLS Bank International:

In Diehr … we held that a computer-implemented process for curing rubber was patent eligible, but not because it involved a computer. The claim employed a "well-known" mathematical equation, but it used that equation in a process designed to solve a technological problem in "conventional industry practice." The invention in Diehr used a "thermocouple" to record constant temperature measurements inside the rubber mold — something "the industry ha[d] not been able to obtain." The temperature measurements were then fed into a computer, which repeatedly recalculated the remaining cure time by using the mathematical equation. These additional steps, we recently explained, "transformed the process into an inventive application of the formula." In other words, the claims in Diehr were patent eligible because they improved an existing technological process, not because they were implemented on a computer.

But the Alice decision made clear that you can’t just take an abstract idea and add “do it on a computer” to make the idea patentable.

Under Alice, software patents are allowed when they "improve the functioning of the computer itself" or "improve an existing technological process." Clearly, not all software meets this standard.

Some commentators had either feared or hoped that in its Alice decision the Supreme Court would invalidate software patents entirely. Instead, software patents have boomed in the wake of Alice.

In 2019, 61.8% of issued US patents were “software-related” – compared to 43% the year Alice was decided. IBM alone was granted 7,679 software-related patents in 2019.

The answer to the question “is software patentable?” is “yes, but” because patent attorneys, patent examiners, and courts are still wrestling with how to interpret Alice.

As Ars Technica commented,

European patent law has a concept called the technical effect doctrine. European Patent Office guidelines describe a technical effect as "the control of a technical process or of the internal functioning of the computer itself or its interfaces." The technical effect doctrine says that if an invention improves the function of a computer, then it's likely to be patentable.

So, what exactly counts as a "technical process"? The cynical answer may be that it is whatever a judge deems to be tech-y enough—a "you know it when you see it" situation. This has created real difficulties in determining on which side of the fence any application lies.

In short, SOME software is patentable, but WHICH software is patentable isn’t always clear in advance of a patent application being either accepted or rejected. And even after the USPTO accepts or rejects a patent application, the courts have the final word.