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Ladas & Parry Guide to
Statutory Protection for Computer Software
in the United States

Patents

Introduction
Case Law Developments
The First Inventor Defense
The USPTO's Position Today
Machines and Manufactures
Processes
Design Patent Protection for Computer Graphic Displays


Introduction

Under the U.S. patent statute, patents may be granted for any new and useful process, machine, manufacture or composition of matter.[1] This broad statutory definition of subject matter has enabled the United States to take a lead in widening the scope of subject matter for which patent protection may be obtained. Thus, the United States has been in the forefront in developing the criteria for patentability of computer-related inventions. Over the years, however, case law has put a gloss on this general statement and created certain limitations on what is patentable. Among the types of inventions that have in the past been denied patent protection by case law are (1) inventions in the form of certain algorithms and (2) inventions relating to methods of doing business.[2]

Traditionally cases decided by the courts have tended to treat these two classes of excluded subject matter as being distinct. However, they have similarities in situations where a business scheme is to be implemented by use of a computer since in essence most business schemes are simply rules for solving problems. Furthermore the United States Patent and Trademark Office (PTO) has recently indicated that, although "Office personnel have struggled with claims directed to methods of doing business", such claims are to be treated like any other type of process claim." We will therefore consider these two classes of subject matter together in this paper.

Although not discussed in detail in this paper, to be patentable an invention must meet all of the other criteria for patentability that are required for other inventions. The most significant of these is the invention must be new and not obvious. As a practical matter these requirements present major problems for the Patent Office since searching the prior art in this area is extremely difficult and few Examiners have the necessary background to make good assessments of obviousness. The problem was highlighted when the Commissioner of Patents used his powers to order re-examination of U.S. Patent 5,241,671 which related to the Compton Multimedia patent. This patent had been claimed by competitors to cover almost all possible ways of providing a multimedia system and to be nothing more than a collocation of old elements. On re-examination new art was considered and an initial determination made that the claims were invalid. There is still very little case law giving guidance as to the application of these requirements to inventions in the software and business method arts and one should not be surprised if some of the early patents granted in this field are ultimately held to be invalid not because of the nature of their subject matter but on more traditional grounds.



Case Law Developments

The broad statutory definition of subject matter has enabled the United States to take a lead in broadening the scope of subject matter for obtaining patent protection. The Supreme Court has noted the breadth of this language in Diamond v. Chakrabarty[3]in the following words:

In choosing such expansive terms as "manufacture" and "composition of matter" modified by the comprehensive "any". Congress plainly contemplated that the patent laws would be given wide scope. The relevant legislative history also supports a broad construction.

The Committee Reports accompanying the 1952 Act inform us that Congress intended statutory subject matter to include anything under the sun that is made by man" . This is not to suggest that Section 101 of the Patent Act has no limits or that it embraces every discovery. The laws of nature, physical phenomena, and abstract ideas have been held not patentable. Thus a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law E = mc2; nor could Newton have patented the law of gravity. Such discoveries are "manifestations of ... nature, free to all men and reserved exclusively to none.

A fairly early example of what cannot be patented was found in one of the claims of Morse's patent in O'Reilly v. Morse[4]. The claim was to "the use of the motive power of electric or galvanic current ... for making or printing intelligible characters ... at any distance." The Supreme Court rejected such a claim as not being directed to any statutorily defined class of protectable subject matter but merely to a "principle". [5]

Over the years questions have arisen as to whether certain other types of invention can be the subject matter of patent protection. The types of subject matter that must have been commonly subject to consideration are those that have been classified as being directed to mere "mental steps". The "mental steps" doctrine developed slowly in the first half of the Twentieth Century and reached its zenith in Halliburton Oil Well Cementing v. Walker[6] and, although not specifically adopted by the Supreme Court in Gotschalk v. Benson[7] clearly finds echoes[8] there. It bedeviled some early attempts to secure patent protection in the field of computer software but has been largely by-passed by the most recent case law.

The first sign of a breach in the traditional view[9] that inventions relating to computer software were unpatentable was found in 1979 in the case of In re Bradley.[10] The Court of Customs and Patent Appeals (the predecessor of the Court of Appeals for the Federal Circuit in respect of appeals from the Patent Office) held an invention relating to firmware to be patentable. Two years later, in the case of In re Diehr[11] (which related to a computer controlled process for curing rubber) the Supreme Court held a computer-related process to be patentable on the ground that the mere fact that the claims required a computer to apply a mathematical formula in controlling a process did not mean that an attempt was being made to patent the mathematical formula itself. The court commented that an application of a mathematical formula (or indeed of any law of nature) to a known structure or process "may well be deserving of patent protection" and stated its view that in determining whether patentable subject matter existed one should look at the invention as a whole and not just at what was novel about it. Thus, a computer controlled process could be patentable even if the process when controlled by other means was already known as long as application of the program used to the process was not obvious. The court did, however, reassert the "long-established principle" that laws of nature, natural phenomena and abstract ideas are excluded from patent protection.

An early illustration of the application of the Supreme Court's reasoning is found, for example, in the decision of the Court of Customs and Patent Appeals in In re Abele[12] where the court upheld patent claims which related to a program for carrying out calculations when applied to X-ray data from a CAT scanner, but rejected claims directed to the program for the calculation itself.

The PTO approach to the algorithm issue came to be known as the Freeman-Walter-Abele test after the three cases on which it was based.[13] The test was summarized by the Court of Appeals for the Federal Circuit in Arrythmia Research Technology Inc v. Carazonix Corp[14] as follows:

It is first determined whether a mathematical algorithm is recited directly or indirectly in the claim. If so, it is next determined whether the claimed invention as a whole is no more than the algorithm itself; that is whether the claim is directed to a mathematical algorithm that is not applied to or limited by physical elements or process steps.

The mere fact that a mathematical formula is not used does not of itself ensure that a claim is patentable. As was stated in In re Grams[15] "words in a claim operating on data to solve a problem can serve the same purpose as a formula".

Examples of cases where inventions have been found to be suitable for patent protection include inventions relating to analysis of electrocardiographic signals[16], conversion of seismic signals or traces[17], a vehicle navigation system.[18], a method of determining the width of fractures intersecting a borehole[19] and a system for processing and supervising a plurality of subscriber accounts by the interaction of various means.[20] However, a method for graphics interpolation was held not to be patentable on the ground that when the algorithm was discounted all that was left in the claim was display of the result obtained and "such post-solution activity does not convert claimed subject matter into" something covered by the statute.[21]

After a period of relatively little case law on this subject at the appellate court level, the mid to late 90's have seen several cases that need to be considered.

In In re Warmerdam[22] the claimed invention was a method of generating a data structure which represented the shape of a physical object in a position and/or motion control machine. After pointing out that the well-known expression that "anything under the sun that is made by man is patentable" did not in fact appear in the patent statute, the Court reemphasized the Supreme Court's holding in Diehr that the laws of nature, natural phenomena and abstract ideas were not patentable. The case is of interest in that the court seems to have tried to get away from the use of the term "mathematical algorithm " as being something to which precise boundaries could not be applied and to ask the question whether the claimed method did any more than manipulate abstract ideas. It concluded that the claims did no more than call for such manipulation and so did not encompass statutory subject matter.

In In re Schrader[23], the Court of Appeals for the Federal Circuit denied patent protection to Schrader's claimed method whereby parcels of real property or other things are sold at auction by a procedure of bidding and determining optimum prices that, according to Schrader, "is usefully but not necessarily performed with the aid of a computer." The basis of the court's decision was that it considered what Schrader was seeking to patent was a mathematical algorithm.

In reaching its decision, the CAFC applied the following two-step test: first, determine whether a mathematical algorithm is recited directly or indirectly in the claim; if it is, then determine whether the claimed invention as a whole is no more than the algorithm itself.

Thus, if the claim is directed to a mathematical algorithm that is not applied to or limited by physical elements or process, the claim is non-statutory. "However, when the mathematical algorithm is applied to one or more elements of an otherwise statutory process claim ... the requirements of [the statute] are met."

Since the Federal Circuit considered that Schrader's process was a mathematical optimization procedure and thus a mathematical algorithm was implicit in the claim, the court addressed the second step. The Court found that there was nothing about the steps set out in the claim that reflect a physical change, effect or result and, since the second step of the test was not met, the method was unpatentable. The court distinguished Schrader from cases where patentable subject matter was found when the claims involved the transformation or conversion of subject matter representative of physical activity such as Arrhythmia Research Technology v. Corazonix Corp[24]. where an algorithm was applied to data obtained from electrocardiograph signals that were representative of human cardiac activity and In re Taner[25] where the data in question were seismic reflection signals representing discontinuities below the earth's surface.

The Schrader decision may be compared with the decision in Paine Webber v. Merrill Lynch noted above[26], where the Federal District Court of Delaware, had found Merrill Lynch's system for processing and supervising subscriber accounts to be patentable subject matter because the court was "unable to find any direct or indirect recitation of a procedure for solving a mathematical problem" in the claimed system. A factor in that case may also have been that the invention was claimed as a system rather than a process and thus the claim at least implied a requirement for use of appropriate hardware.[27]

The Court of Appeals for the Federal Circuit heard the case of In re Alappat[28] in part because of certain procedural issues (the case achieved some notoriety when the Commissioner of Patents required reconsideration of an Appeal Board's decision to allow a patent before a separate and enlarged Appeal Board, including himself, which then held the subject matter to be unpatentable). In its decision the Federal Circuit upheld the Commissioner's right to proceed in the way that he had. However, the court reversed the Board's decision on the substantive issue and upheld the patentability of a claim directed to: "A rasterizer for converting vector list data representing sample magnitudes of an input wave form into anti-aliased pixel illumination intensity data to be displayed on a display means" which comprised a series of elements defined purely in means form for determining certain features, normalizing such features and then outputting the illumination intensity data in question.

The purpose of the invention was to provide a smooth wave form display in a digital oscilloscope. The essence of the Patent Office's rejection of the case had been that the means elements of the claims each simply recited a mathematical operation so that the combination of the steps in itself was a "mathematical algorithm for computing pixel information" and that "when the claim is viewed without the steps of this mathematical algorithm no other elements or steps are found". This being the case, the enlarged Patent Office Appeal Board had found the invention lacking in statutory subject matter.

The Federal Circuit disagreed and concluded that what was being claimed was in fact a machine since the means in question had to have some physical embodiment (and since the decision In re Donaldson[29] it was clear that means claims had to be construed so as to cover equivalents of what was actually disclosed in the specification). The court then, however, went on to consider the general question of the "mathematical algorithm" exception to patentability. While not denying the existence of such an exception, the court concluded that it must be read very narrowly. The court took the view that Congress had intended that "anything under the sun that is made by man" should be patentable and thus one should not read additional limitations into the statute. The limitations that existed were to be confined simply to those set out in the Supreme Court's decision in In re Diehr namely "laws of nature, natural phenomena and abstract ideas". Mathematical algorithms were only to be found to be unpatentable when they represented nothing more than an abstract idea. The court concluded that what was being claimed in the present case was:

not a disembodied mathematical concept which may be characterized as an 'abstract idea' but rather a specific machine to produce a useful concrete and tangible result.

The fact that the four claimed means elements function to transform one set of data to another through what may be viewed as a series of mathematical calculations does not alone justify a holding that the claim as a whole is directed to non-statutory subject matter.[30]

The mere fact that the applicant himself had admitted that the claim covered a general purpose computer programmed to carry out the claimed invention did not alter this conclusion since once programmed to carry out the particular functions set out in the claim, "such programming creates a new machine because a general purpose computer in effect becomes a special purpose computer once it is programmed to perform particular functions pursuant to instructions from programmed software".

A strong dissent to the decision was registered by Chief Judge Archer on the ground that the holding was in effect opening the door to patentability of discoveries in mathematics, the scope of which would be repugnant to Congress's statutory scheme for the promotion of the useful arts.

In the next case to come before the Federal Circuit Court of Appeals on this subject, In re Trovato[31], claims that were superficially similar to those in question in Alappat, were initially held not to be patentable. However this panel decision was subsequently vacated sua sponte by the court and remanded for reconsideration in the light of Alappat and proposed new Patent and Trademark Office guidelines in this area.[32] In Trovato the claims in issue were again in means plus function form and were directed to a method of determining motion of an object. In this case, however, unlike Alappat, the specification gave little detail as to the means that were to be used. The Court pointed out that:

Trovato's applications fail to explain how the claimed inventions actually employ the numbers to control movement ... the absence of even a cursory description of how the computed values are implemented further indicates that the claimed methods comprise only numerical manipulation.

The court contrasted this situation with that in Alappat where the specification had disclosed a specific hardware embodiment involving an arithmetic logic circuit, barrel shifters and a read only memory. Whether the features were in fact any more important than the hardware features implied in Trovato by its simple reference to use of a computer is difficult to say but it is hard to envisage a computer without arithmetic logic circuits and a read only memory.

Following these cases, there was a tendency to write claims to include a tangible product or an application of the results to a physical situation, if this was not possible one tried to bring the claims within the terms of the Alappat decision and recite the operation of the program on specific physical elements of the computer itself.

The patentability of software-related inventions is not, however, confined to the algorithm/business method area.

In In re Lowry[33] the question before the court was whether the data structure and information in a computerized data processing system should be analogized to printed matter when considering issues of patentability. The claim in issue was directed to a memory for storing data for access by an application program and recited one of its elements as: "a plurality of attribute data objects stored in said memory, each of said attribute data objects containing different information from said database." An attribute data object (ADO) was defined in the specification as a single primitive data element comprising "sequences of bits which are stored in the memory as electrical (or magnetic) signals that represent information." The Patent Office appeal board had analogized the data structure composed of such ADO's to printed matter and in accordance with established case law[34] held that one could not rely on printed matter to establish a distinction from the prior art. Thus the claim was held to be obvious over prior art that differed from what was claimed only with respect to the ADO's and their hierarchical and non-hierarchical relationships in the database. The Court of Appeals for the Federal Circuit disagreed, it stated "The printed matter cases have no relevance where the invention as defined by the claims requires that the information be processed not by the mind but by a machine, the computer" (emphasis in the original). In the present case the data in question could only be accessed by sophisticated software systems. Thus the differences between the prior art and the data structure of the invention in suit had to be considered in deciding on the obviousness or inventiveness of the invention claimed.

Until recently, the United States Patent and Trademark Office Manual of Patent Examining Procedure took the view that business schemes and ways of operating a business are not patentable. Devising ways of securing protection for useful business schemes probably remains one of the last great frontiers for creative lawyering in respect of patentable subject matter. Inroads on the traditional prohibition have already been made. For example, claims have been allowed to a system for processing and supervising a plurality of subscriber accounts by the interaction of various "means", effecting such processing and supervision which, as a practical matter, was possible only by using a computer.[35] The recitation of various "means" in the claim seems to have allowed the Patent Office to regard the claim as a method claim. Certainly, this was what was understood when the patent came to be litigated.[36] The court upheld the patent, commenting that it was not necessary to determine whether it in fact claimed an apparatus or a process on the ground that even though the scheme might be unpatentable if done by hand, it should in fact be treated as a computer related invention. Once this was done, it was clear that what was claimed was not a simple algorithm and so was patentable for the reasons discussed above.

The question of the patentability of essentially business schemes came before the courts again in the case of State Street Bank v. Signature Financial[37]. The claims were to a "data processing system for managing a financial services configuration of a portfolio established as a partnership, each partner being one of a plurality of funds" comprising a number of different "means" including several different "means for processing data" for a number of different purposes. The claims were intended to cover what was referred to as a "hub and spoke" relationship between a partnership portfolio and partner funds. The outcome of all the data processing was inter alia to allow allocation between the spokes of the hub's daily income, expenses, net realized gain or loss and the unrealized gain or loss. It is of particular use to fund managers. The Massachusetts District Court had held that the claim did not define a patentable invention under 35 U.S.C. §101 on two grounds: first, the claim was directed to, in essence, an accounting system that could be carried out with pencil and paper and therefore lacked sufficient "physical" activity to be patentable (i.e. it is effectively a mathematical algorithm) and second it fell within the long-established exception to patentability that had established for business methods.[38]

On appeal the Federal Circuit Court of Appeals reversed the lower court decision. The Court first noted that as a practical matter the time frame within which the data processing had to be carried out a computer or equivalent device is a virtual necessity. The court went on to construe the claim, noting that it was written in means plus function form and holding that when properly construed in the light of the specification it was directed to a machine. Thus, in view of the court's decision in In re Alappat, the present system was patentable as long as it met all the other requirements for patentability. The Court then went on to address the supposed mathematical algorithm and business methods exceptions to patentability.

So far as the former is concerned, the court stated:

Unpatentable mathematical algorithms are identifiable by showing that they are merely abstract ideas constituting disembodied concepts or truths that are not "useful." ... Today we hold that the transformation of data representing discrete dollar amounts, by a machine through a series of mathematical calculations into a final share price, constitutes a practical application of a mathematical algorithm ... because it produces "a useful, concrete and tangible result" - a final share price ...

So far as the business method exception to patentability was concerned , the court took the "opportunity to lay this ill-conceived exception to rest." After analyzing prior cases that had been said to create the exception the court concluded that all of them had really been decided on the ground that what was claimed was an abstract idea or a lack of novelty and so concluded that the exception did not exist. In noting that the district court's application of the doctrine had in part turned on its finding that the patent in suit was "sufficiently broad to foreclose virtually any computer-implemented accounting method necessary to manage this type of financial structure", the court noted that issues of undue breadth of claim could be addressed under other provisions of the law.

Subsequently, the Federal Circuit was faced with the question of whether process claims which essentially related to a method for calculating charges for long distance telephone calls depending upon which long distance carrier had been selected by the originator of the call and the recipient met the requirements of 35 U.S.C. §101.[39] The court viewed the Grams and Schrader cases noted above as being "unhelpful" because of a misguided concern as to whether any "physical transformation" resulted from the acts carried out, this in the court's view not being required by the Supreme Court precedents. The court reasserted its view as set out in Alappat that if what was claimed was more than an abstract idea or law of nature or if the mathematical concept has been reduced to some practical application rendering it useful, then the statutory requirement was met. There was no difference in principle between apparatus claims as found in Alappat and State Street Bank and the process claims of the present invention and so 35 U.S.C. §101 had been complied with.

In the winter of 1999-2000, considerable attention has been given to the case of Amazon.com v. Barnesandnoble.com.[40] Both parties are active in selling books and other items over the Internet. Amazon secured a patent for a method a method of placing an order in a client- server system in which the key elements are that on the client side "in response to only a single action being performed" a request is sent "to order the item along with an identifier of the purchaser of the item to a server system" and that the "item is ordered without using a shopping cart ordering model". The District Court in the Western District of Washington granted a preliminary injunction to restrain Barnes and Noble from continuing to use one of its means for ordering on the ground that it was likely to be found to be an infringement of this patent even though the action was brought only 22 days after the patent issued. Normally the courts like to see that a patent has been accepted and respected by the industry before granting preliminary injunctions in patent cases. Here, however, the evidence put in by Barnes and Noble to challenge validity seemed weak to the judge and she took note of the fact that the claimed technique had already achieved commercial success.



The First Inventor Defense

The new first inventor defense (sometimes referred to as a prior user defense) was added by the 1999 reforms to the patent law and became effective on November 29, 1999 except that it shall not apply to any action for infringement that is already pending on that date.[41] The defense applies only to actions for infringement of claims that may be infringed by "any method of doing or conducting an entity's business". The exact scope of this provision is not entirely clear. The Senate Committee report refers to the need for such a provision as becoming more urgent following the Federal Circuit's decision in State Street Bank v. Signature Financial Group as a result of this decision having held to be patentable various business methods which until recently had been thought not to be patentable but indicates that the provision is not intended to be confined to the facts of that case, commenting:

The first inventor defense is not limited to methods in any particular industry, such as financial services, but applies to any industry which relies on trade secrecy for protecting methods of doing or conducting the operations of their business.

A further comment indicates that the provision is not intended to be restricted to any particular form of claims if the essence of what is claimed is in fact a business method, for example it is intended to cover a machine that has been programmed to carry out a business method. The Senate Committee comments on the bill point out that trade secret law serves the public interest in a different way from patent law by protecting investments in new technology and notes that "it would be administratively and economically impossible to expect an inventor to apply for a patent for all methods and processes now deemed patentable."

The provision applies only if the party being sued had, acting in good faith, reduced the subject matter in question to practice at least one year before the effective filing date of the patent being sued on. (The effective filing date is defined as including validly claimed priority dates.) If the requirement is met it protects two different types of activity depending on the nature of the party asserting the defense. These are where there had been use in good faith before the effective filing date of the patent in suit that is either commercial use (which is defined as including filing an NDA or similar application for marketing approval) or in the case of a non-profit research laboratory or a non profit entity "such as a university, research center or hospital" any use "for which the public is the intended beneficiary". The defense is personal, does not render the patent invalid and in cases where a business is assigned is confined to sites where the invention was used before the effective filing date of the patent or the date of the assignment, whichever is later. The defense does however carry over to those who acquire a "useful end product produced by the patented method." In the case of non-profit organizations is confined to use the organization in question and does not extend to any subsequent commercialization of that work. Pleading such a defense which fails shall be a ground for award of attorney fees to the prevailing party.



The USPTO's Position on Computer Software Today

In April 1995 following the Lowry decision, the United States Patent and Trademark Office announced that it would no longer reject claims to computer programs embodied in a tangible form such as a floppy disk as being per se unpatentable but would require claims to such inventions to be examined for novelty and nonobviousness.

In October 1995, the PTO issued a legal analysis in support of its view on the patentability of computer-related inventions generally following decisions such as Alappat and Lowry which effectively overturned much of the PTO's previous thinking. According to the PTO's new draft guidelines, one must first determine whether an invention is useful in the technological arts having a "real world" value as opposed to something that represents nothing more than an idea or concept or is simply a starting point for further investigation or research. Within these confines methods of doing business should be treated like any other process. The claimed invention must then be assessed against the classes of statutory subject matter namely: machines (which in principle may include a computer programmed to carry out certain actions), articles of manufacture (which in principle may include computer readable memory devices) and processes (which in principle may include specific operational steps performed on or with the aid of a computer. According to the PTO, the only types of subject matter that are "clearly non-statutory" are:


(1) data structures or programs per se (which are mere information rather than a computer implemented process or specific machine or computer readable memory as an article of manufacture;

(2) compilations or arrangements of nonfunctional information or a known machine-readable storage medium encoded with such information; or

(3) natural phenomena such as electricity and magnetism.

Claims to subject matter of these types are indistinguishable from abstract ideas and laws of nature. However, if a claim recites the use of a computer program to act on the data, this should be considered as a claim to a process and if the claim recites a physical structure then it should be considered an article of manufacture. The PTO also points out that nonfunctional data (such as words, images or other information cannot provide a practical utility as required by the patent law and as such merely loading such information onto, say, a known compact disc does not render the disk patentable.

Not being in the class of inventions regarded per se as falling outside the bounds of statutory subject matter does not, however, mean that an invention is necessarily patentable, even if it is novel and not obvious. The guidelines legal analysis addresses the issues that arise in the statutory classes as follows:

Machines and manufactures:

To be patentable the claim must recite definite physical characteristics. The PTO points out that a computer memory may be defined in terms of a logic circuit formed when a programmed computer performs in accord with the program, a memory defined by functional and/or structural characteristics or a memory whose physical structure is defined by the act of storing a computer-executable program code. Lacking such physical characteristics, a product claim that is associated with a process may also be patentable but only if that process is itself the subject of statutory subject matter.[42]

The PTO does, however, take the view that a signal carried on a carrier wave can be regarded as being a manufacture and patentable, so as long as the signal is new, non-obvious and useful.

Processes:

According to the PTO to be statutory a process must involve one or more acts that manipulate physical matter or energy resulting in some form of physical transformation. However, the subject matter manipulated does not have to be a physical object but can be "intangible matter representative of or constituting physical activity or objects". Thus not only is a process patentable if it affects objects external to a computer or the way in which the computer itself functions (such as an operating system) but also if the process is one that acts on data in the form of a magnetic or electrical signal where the data represent a physical object or activities external to the computer "and where the process causes some transformation of the physical but intangible representation of the physical object or activities." However, a process that simply performs mathematical operations or which manipulates abstract ideas without practical application (such as bids) is still regarded as being non-statutory. Furthermore a non statutory process will not be rendered statutory by "post solution" activities that do not impose any real limitation on the claim so that merely reciting that the results of a mathematical operation are displayed, recorded or transmitted or that the results are equated with other data do not render the claim statutory.

While these guidelines were being adopted, the Commissioner himself moved the Court of Appeals to vacate a decision of the PTO Appeal Board in In re Beauregard.[44] The Board had rejected an application relating to a computer program product on the basis of the printed matter doctrine. The court noted that the PTO now accepted that "computer programs embodied in a tangible medium such as floppy diskettes" could form patentable subject matter and remanded the application to the Board for further consideration.

In July 1996, a long-standing section of the Manual of Patent Examining Procedure setting out the prohibitions on patenting methods of doing business was deleted and replaced with a discussion of the trend exemplified by the cases discussed above.



Design Patent Protection for Computer Graphic Displays

The related question considered recently is that of design protection for computer graphic displays. Four decisions of the PTO Board of Patent Appeals and Interferences published in 1993[45] rejected applications for design patent protection for icons of the type displayed on computer screens to indicate use of particular programs etc. The rejections were on the basis that such icons were not directed to articles of manufacture. In an addendum to one of the decisions[46] the Board did, however, indicate that had the drawings submitted in the case shown a computer monitor with a screen displaying the icon in question, this would in principle have qualified for design patent protection.

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