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Computer Software Patents in the US

by admin on 2 March 2011

“To patent or not to patent” was the question that the US Supreme Court faced back last year when reviewing the so-called Bilski case. The Court has started to hear a number of patent cases in the past few years. Some, such as the Bilski case, are probably taken to see if the Court can find some sense in the diametrical positions held by advocates and opponents of software and business method patents.

Back in November when the Bilski decision was issued – and which has been extensively commented here and here – the Supreme Court clearly said as long as the patent fulfils one of the categories set out in Section 101 of the 1952 Patent Act (i.e. process, machine, manufacture or composition of matter), then the patent  was fundamentally acceptable. It was only if the patent application related to a “law of nature”, a physical phenomenon, or an “abstract idea” would a patent be refused.

The Court in Bilski refused to define a “bright line” test for an unpatentable abstract idea. Instead the Supreme Court said that the lower courts should develop “other limiting criteria”.

So it was with some interest that lower court – in this case the Court of Appeals for the Federal Circuit – took on a case relating to patents on the processing of digital images (more accurately digital image halftoning). In RCT v Microsoft, the lower Arizonan Court had held that some of the claims in the patents were invalid as being too abstract. The CAFC said that was incorrect. The CAFC refused to define abstract but said that  “this disqualifying characteristic should exhibit itslf so manifestly as to override the broad statutory categories of eleigble subject matter. In other words the patent had to be so obviously “abstract” that it should never be granted. A somewhat rudimentary, but probably practical, test.

What was more interesting was the CAFC’s observation that the claimed methods in these patents (held by RCT) incorporated algorithms and forumulas. These algorithms and formulas, even though admittedly a signficiant part of the claimed combination, did not bring this invention even close to abstractness. Since, as the CAFC noted, the Supreme Court had already made it abundantly clear that inventions incorporating and relying upon even a well known mathematical equation do not lose eligibility because serveral steps of the rpcoess use that mathermatical equation.

This is clearly good news for many innovators seeking patent protection. Once again the US has emphasised: you cannot get patent protection for an abstract idea. But once you use the abstract idea (algorithm) for a practical purpose, then patent protection opens up.




There’s an interesting news report over at EE Times Asia on the patent side of photovoltaic panels. Citing a report by Canadian company Semiconductor Insights EE Times notes. The report is US-centric and so I took the opportunity to see if there was any special European angles.  Germany has been very much in the lead in promoting solar energy. The 1990 “Stomeinspeisungsgesetz” (Act on feeding electricity into the grid) was the first to introduce the concept of small-scale producers of electricity from renewable sources having the right to feed in electricity into the web. This was amended slightly in 2000 as the  Renewable Energy Sources Act (a link to an English translation can be found here). The law has become a model around Europe and the world.

The 1990 act stimulated the development of solar technology in Germany and one might have expected German companies to massively profit from the scheme. Indeed Q-Cells, based in Bitterfeld in the former East Germany, benefitted massively and has today become one of the leading suppliers of photvoltaic panels in 2008 (see the Wikipedia article for further information).

Another German company, SiC Processing was listed in the 1998 Guardian/Library House’s CleanTech 100 as one of top 10 companies (see here)

The interesting question for me was to look at the IP protection on the products. Clearly there may be a lot of processing knowledge that companies would chose to protect as trade secrets and not through patents. However, given that the panels can be found on many rooftops and also in do-it-yourself stores, one might expect many innovations to be the subject of patents.

Intriguingly, I was only able to identfy 19 families of published patent applications for Q-Cells. There may be more in the pipline, but that seems a small number for a companies whose balance sheet at the end of December 2008 showed intangible assets with a value of  EUR 48.4 Million

SiC Processing held a single patent – filed initially in Italy in 2005. This was more on recyling than on solar cells itself.

I thought it intriguing to see how this fits into the patent protection of other companies in this technical space. Using the most popular European Classifications from the Q-Cells portfolio, a worldwide search of patent applications showed Japanese companies (Canon, Sanyo, Sharp and Matsushita) dominating the photovoltaic landscape. The first European organisation was the German contract research organisation Fraunhofer Gesellschaft in fifth place. This correlates with the report in EE Times which identified the predominance of Asian companies in the space

The Japanese patent system encourages multiple applications by domestic applicants which tend to be combined when filed outside of Japan. It tends to overemphasise the contributions of Japanese companies when worldwide statistics are used. I therefore limited the search to only patents filed or pending in Europe and identified that Sanyo and Sharp still occupied top spots (first and second with respectively 49 and 47 out of a total 1590). Du Pont came in third place followed by Canonl in fourth pace and Sharp in fifth place. The Fraunhofer Gesellschaft had 26 patents or applications  in total and were in tenth place. Q-Cells only had seven patents or applications using this set of data (which is the most relevant for solar cell photovoltaic panels).

What conclusions can we draw from this? Intriguingly the Japanese companies are putting an increasing amount of research and development work into developing a substantial photovoltaic patent portfolio and clearly in terms of numbers are overtaking German companies in the European marketplace. However, the commercial activities of Japanese companies are much more limited. It is possible that much of the innovation taking place in Europe is on processing matters which is more appropriate to trade secret protection – as you do not want after all to let your competitors know how the silicon is being processed.

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W3C investigating Apple’s patent

June 24, 2009

There’s a rather interesting report on the UK ZDNet website about Apple’s refusal to licence royalty-free a patent for use in a proposed web standard. US Patent No 5,764,992 relates to a method for automatically updating software programs on a computer. Web standards are set up by the World Wide Web Consortium. Their website states […]

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