In April, the Supreme Court issued two rulings with respect to patents that will have significant ramifications for software companies. The first case dealt directly with Microsoft, which won big, staving off millions in damages for patent infringement. But in the second ruling, dealing with the design of a gas pedal control system for cars, Microsoft (and the whole software industry) lost big time. However, in one of those rare cosmic moments, the FOSS movement was a major winner in both cases.

In January (2007) I wrote here in Software ain’t patentable, damnit! about the ramifications of the pending Microsoft v AT&T case that was going to the US Supreme Court. Well, on April 30, 2007, the Supreme Court released its ruling on that case, and also released its ruling on KSR v. Teleflex. As it turned out, the latter case is the more significant ruling regarding patents, and has put not only the validity of software patents into question, but has also put a host of (junk) patents in jeopardy that will now be ripe for challenging.

In Microsoft v AT&T the Supreme Court ruled (8-0) that Microsoft did not infringe on AT&T’s patents by exporting Windows on disks to be copied by European distributors, as this software was deemed not to be a computer “component” under US patent law. Here’s a short sample of analysis on the ruling here, here, and here.

What was potentially at stake was whether software could even be considered patenable, but the Court chose not to directly address that issue. However in KSR v. Teleflex, the Court (7-1) did squash a rigid standard used for contesting the validity of patents, that will now allow for greater consideration to reject patents, or invalidate existing patents, based on whether the invention was “obvious” to practitioners within a given field of Art.

Reaction to the KSR ruling was swift, with many predicting tough times for all patent seekers. Below is a snippet from this article:

Patent attorneys are predicting it will be harder to protect inventions after the ruling in KSR vs. Teleflex, that there will be more litigation to contest patents, and that even existing patents could become less valuable. “It’s going to be much harder to get patent protection on everything, including software,” said Steven Rubin, an intellectual property attorney with the firm WolfBlock...

Even more dire consequences of this ruling can be read here.

In fact, it didn’t take long for the ink to dry on the KSR ruling before Vonage went back into court, citing it, to try and get a new trial on its conviction for infringement of Verizon patents, that nearly put it out of business. Though Vonage was denied a new trial, it was allowed to cite the KSR decision in its appeal, to overturn its conviction. See a sample of articles on that here, here, and here.

So what should this mean? Anything that is just an electronic or web based analog of a mechanical, or previously devised process, should not be patentable as it should fail the “obvious” test (it’s obvious you can mimic/perform many mechanical actions in software). And much of what is obvious in a field of Art is so fundamental and basic it’s never formally documented. Thus ripe for invalidation are “business methods” patents, software, and probably many biology and drug patents too. These rulings may finally spur Congress to take action to reform the whole patent process and system, which has been completely subverted by corporate and commercial interests, and bring it back in harmony with the Constitutional requirement that patents should only be granted “to promote the Progress of Science and useful Arts”. (US Constitution, Article I, Section 8).

Ending patent pollution

The dicta from the Supreme Court rulings questioned the legitimate “inventiveness” embodied in the past two decades worth of patent growth. The first US patent was issued in 1790, and patent #1 issued by the United States Patent and Trademark Office (USPTO) was in 1836. It took 75 years to issue #1,000,000 in 1911, with successive milestones as follows: #2,000,000 in 1935, #3,000,000 in 1961, #4,000,000 in 1977, #5,000,000 in 1991, #6,000,000 in Dec 1999, and #7,000,000 in Feb 2006. Thus, during the past 16 years (1991-2007) the USPTO has issued over two million patents (almost 30% of all patents), taking only a little over six years to go from six to seven million. See patents chart. Have people really become so much more “inventive” within the past two decades, or are most of these patents junk?

Software probably constitutes the single largest Art class that has fueled this recent patent pollution proliferation. As I pointed out in my previous blog, software (programs) should be non-patentable, as is the case with music and literature (which can be copyrighted). So while the Supreme Court did not directly say this, as noted above, it has provided a means to fundamentally attack software patents as being “obvious” to anyone skilled in the “art” of programming.

So while Microsoft won a reprieve from damages in its own case, it’s about to lose the big stick it waves over the FOSS movement whenever it feels threatened—its patent portfolio. But the wolf tickets its been trying to sell with its “agreement” with Novell doesn’t seem so significant now (if it ever did), and lessens the effectiveness of all such agreements in the future.

However it eventually shakes out, the consensus of analysts is that it will be easier now to challenge existing and new patents, and thus fewer will eventually be issued. And this is good. The patent system is not being used to protect genuine product innovation, but rather to stymie innovation which threatens entrenched monopolistic entities, who are unwilling to compete in the open market, but would rather use the legal system to threaten, bankrupt, and destroy competitors. This is not the Constitutional intent of patents.

The Supreme Court rulings have now created a better, and more common sense directed, playing field for obtaining patents, putting software (and business method) patents in grave jeopardy. This will only fortify the legal status of FOSS (to those who have doubts about it) and potentially eliminate legal threats to its existence and growth. It also allows the FOSS movement to go further on the offensive, to more effectively attack bad patents. All-in-all, if you love FOSS, it was a rather good day in court.