Evan Schuman: Supreme Court on obvious patents: Common sense isn't so horrible

One of the key reasons so many IT execs hate patent trolls -- beyond the fact that they engage in extortion and are, well, evil -- is that the patents they own are generally obvious and pointless. Consider that the typical patent troll attack will often dispatch threatening letters to more than 100 victims.

That gives rise to three possibilities. One, that the patent is for a truly original invention and that 100 companies coincidentally all had the same brilliant idea at the same time -- and the patent troll was simply lucky enough to be the first to run to the Patent Office. Two, that it's a truly original invention and 100 dishonest companies all read the patent and all of them decided to steal that method, even though a few tweaks could have sidestepped the patent violation. Or three, that the patented idea is simply the obvious way any company would perform that action. (Process: take the money from customers and then hand them the product.)

The U.S. Supreme Court last Thursday (June 19) issued a unanimous decision that, although it didn't halt obvious patents, will hopefully slow them down. As for patent trolls, alas, the court offered no relief. Few trolls worry about legal matters, though, as their operations are shakedowns. Many executives -- of both large and small companies -- treat the troll letters as they would a nuisance lawsuit, in that they calculate that it's likely cheaper to just pay the extortion (a.k.a., license fee) and avoid the legal costs and the time executives will have to spend in depositions and replying to discovery along with court appearances.

This is akin to another horrendous business practice, where some unscrupulous companies will deliberately invoice customers for more than they actually owe, calculating that even if a small percentage of customers don't notice and just pay the extra amount, it's worth it. That's why they'll gladly reduce the amount for a customer who calls, waits on hold and demands it.

What the Supreme Court did -- and the fact that it was unanimous means that we can avoid the usual accusations of politics that more lopsided Supreme Court decisions typically attract -- was to cut back on how blatant an obvious patent could be. (My personal favorite analysis came from one of the legal folk at SCOTUS Blog, who penned: "Those of us who sweat in the clammy gymnasia of patent law have been waiting -- with a mix of excitement, dread, and cynical disregard -- for the Alice v. CLS Bank decision. The idea was, when the Court took the case, that we would finally have an answer to the question whether software can be patented under U.S. law. To say we did not get an answer is to miss the depth of the non-answer we did get.")

Here's some of that delicious non-answer. What the decision tried to do was to define what attributes an invention worthy of a patent should have. The Court needed to give federal judges something more concrete than the oft-quoted obscenity definition from Justice Potter Stewart in 1964: "I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description ('hard-core pornography') and perhaps I could never succeed in intelligibly doing so. But I know it when I see it and the motion picture involved in this case is not that."

But how to define an invention worthy of patent protection, other than "I know it when I see it"? From last week's decision: "The Court must distinguish patents that claim the building blocks of human ingenuity, which are ineligible for patent protection, from those that integrate the building blocks into something more, thereby transforming them into a patent-eligible invention."

I'm not so sure about that. It seems if a federal judge believes that a patent application truly shows building blocks of human ingenuity -- or any true ingenuity at all -- that's a pretty good start. Back to the decision.

The Court was clear on the point that a claim that is obvious and not especially clever doesn't suddenly become brilliant because it's been automated via software. "Stating an abstract idea while adding the words 'apply it with a computer' simply combines those two steps, with the same deficient result," the Court said.

The Court did give a solid hint to federal judges by saying that a claimed patent must add something of substance to whatever was already known and used by businesses. In other words, simply writing down and filing a process already widely used in business isn't enough for a patent.

"We must examine the elements of the claim to determine whether it contains an inventive concept sufficient to transform the claimed abstract idea into a patent-eligible application," the decision said. "A claim that recites an abstract idea must include additional features to ensure that the claim is more than a drafting effort designed to monopolize the abstract idea."

"The same is true with respect to the use of a computer to obtain data, adjust account balances and issue automated instructions. All of these computer functions are well-understood, routine, conventional activities previously known to the industry. Because petitioner's system and media claims add nothing of substance to the underlying abstract idea, we hold that they too are patent ineligible."

This strikes at the very definition of an invention. It must be a substantially new way to do something, a way that would not be obvious to the average user of such a system. Amazon's one-click patent is the classic example. Was that a clever invention, or did Amazon simply try to lock down the most logical next step, something that it's reasonable to assume almost every other e-commerce firm would have done on its own?

I'm not certain that the mere idea that a patent needs to add something "of substance" to the abstract idea will meaningfully reduce obvious patents, but if it encourages federal judges to let common sense win the argument every now and then, it's a business win.

Evan Schuman has covered IT issues for a lot longer than he'll ever admit. The founding editor of retail technology site StorefrontBacktalk, he's been a columnist for CBSNews.com, RetailWeek and eWeek. Evan can be reached at eschuman@thecontentfirm.com and he can be followed at twitter.com/eschuman. Look for his column every other Tuesday.

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