Friday, January 18, 2013, 8:52 AM

Insights about software patenting: Cybersource Corp. v. Retail Decisions


What are some recent insights about software patenting?  In Cybersource Corp. v. Retail Decisions, Inc., 654 F.3d 1366 (2011), the United States Court of Appeals, Federal Circuit looked at US Patent 6,029,154, which is directed to a method for detecting fraud in a credit card transaction over the Internet.  The court ruled “Because claims 2 and 3 attempt to capture unpatentable mental processes (i.e., abstract ideas), they are invalid under §101.”  35 USC §101 covers statutory subject matter eligibility, and informs us that we cannot patent an abstract idea.  However, there is a judicial exception, in that we can (sometimes) patent a practical application of an abstract idea (for example, an algorithm or math, applied to a specific method or apparatus).  We may interpret the court ruling as advising that a practical application of an abstract idea is not patentable if the claim language is written too abstractly.  A claim that is directed to a more concrete set of steps or actions might be patentable.  In other words, when claiming software as a method, we may ask ourselves are the steps or actions which are being claimed described in a sufficiently concrete manner, or are they described in an abstract manner?  There is a sliding scale between abstract and concrete, and the courts seem uncomfortable with this, as applied to methods and particularly to software.  More discussion is merited.

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