In June, the Supreme Court heard the case Alice Corp. v. CLS Bank International. In this case CLS challenged a number of Alice's patents claiming that the patents protected ineligible subject matter. The patents in question performed escrow calculations using a computer. CLS contended that the use of the computer was not sufficient to support the patent claims.
In deciding this case the Supreme Court used a two-part test asking:
1) Does the patent involve an abstract idea that would be ineligible for patent protection under 35 USC 101? (i.e. algorithms, mathematical concepts, chemical elements, naturally occurring biological products, or methods that could be carried out in a person’s head)
2) If the patent does involve an abstract idea, is there some element in the claims or some combination of elements that amounts to significantly more than the abstract idea itself?
The Court held that Alice's patents were simply a widely used economic formula used in conjunction with a computer and this was not enough to support patentability. This case in conjuction with Bilski raises the bar for patent eligibility in computer related patents.
Moving forward, patent applicants will find it increasingly difficult to patent computer programs unless they offer some significant improvement over standard algorithms and formulae.
