Software Patents in the United States 101

With advances in software occurring exponentially, there has been a global increase in software related inventions. Protecting such inventions is essential, especially in markets such as the United States where, in 2022, 63.5% of issued utility patents were “software-related”.

Software is generally patentable subject matter in the United States under section 101 of the Patents Act, however, patent eligibility for software related inventions depends upon a number of factors.

The United States Supreme Court decision, Alice, outlined broad questions for consideration when determining whether the software recited in the patent claims is eligible for patent protection. 

First, Alice asks whether the claim is directed to a process, machine, manufacture, or composition of matter. This first step relates to the statutory categories of invention and ensures that the claim falls within one of the four broad statutory categories of invention.

The next question asked is whether the claims recite a judicial exception to the categories of invention – these judicial exceptions include abstract ideas, laws of nature, or natural phenomena. 

Generally, Examiners will assert that claims to software recite abstract ideas and in particular, may fall to the categories of mathematical concepts, methods of organising human activity, or mental processes which are deemed patent ineligible. 

An example of a software patent claim that an Examiner may consider to fall within these categories of abstract ideas may include a method for monitoring stock prices and causing a software program to hold or sell depending on user defined parameters. 

This example may be deemed to rely on the application of mental processes. In particular, checking the stock prices and deciding whether to hold or sell may be undertaken in the mind without the intervention of a computer – albeit on a smaller scale. 

Importantly, the Courts have emphasised that an invention is not considered to be patent ineligible simply because it involves a judicial exception. 

For example, inventions involving judicial exceptions may be patent eligible if the claim recites additional elements that integrate the judicial exception (that is, the abstract idea) into a practical application. 

Importantly, the additional elements must be more than nominal or tangential additions to the claims. The additional elements, either in isolation or upon combination must amount to a meaningful limitation. 

We turn to the United States Courts to understand what may and may not be considered additional elements. In Apple, Inc. v. Ameranth, Inc., 842 F.3d 1229, 1241-42 (Fed. Cir. 2016) the step of printing a menu that was generated through an abstract process was held to be insignificant extra-solution activity. 

Similarly, in Electric Power Group, LLC v. Alstom S.A., 830 F.3d 1350, 1354 (Fed. Cir. 2016), it was found that generic presentation of collected and analysed data was insufficient extra-solution activity to be eligible for patent protection. 

However, what may be considered sufficient extra-solution activity to render a claim eligible for patent protection is outlined in BASCOM Global Internet v. AT&T Mobility LLC, 827 F.3d 1341, 1350-51, 119 USPQ2d 1236, 1243 (Fed. Cir. 2016). 

In this case, the claims were directed to an internet content filtering system. In this decision, the Court held that the claims added non-conventional and non-generic arrangement of computer components for filtering internet content. 

Furthermore, in guidance notes issued by the United States Patent and Trade Mark Office, it is outlined that what may be considered sufficient extra-solution activity includes going beyond merely automating abstract ideas, and instead utilises the abstract information for a practical application. 

For example, cattle monitoring software using a camera to assign an identifier to each cow may be considered an abstract idea, however, using such monitoring software to operate a gate control mechanism enabling certain cattle to be directed to a different location may amount to sufficient extra-solution activity and may therefore be patent eligible. 

It is important to phrase patent claims having regard to United States Patent and Trademark Office examination policies, as well as the continually developing body of case law. 

At Kings, we pride ourselves on staying abreast of the patent landscape in Australia and overseas so you can feel secure globalising your invention.