Software at the Supreme Court: A guide to Monday’s blockbuster patent case

Gigaom

On Monday, the Supreme Court will hear arguments over whether a company named Alice Corp can own an “invention” for escrow accounts. While the idea of escrow has been around for centuries, Alice Corp has a patent that describes the concept of using a computer to implement it.

For Alice’s opponent, CLS Bank, a lot is at stake since the bank uses the patented process to clear millions of dollars in financial transactions each day. Even more is at stake for an American patent system swamped by millions of low-quality patents, many of them — like the one belonging to Alice Corp — related to software.

What can and can’t be patented

While the Supreme Court has issued many decisions about patent rules in recent years, Alice looks at the more fundamental question of what sort of things should receive patent protection in the first place. For now, the law is clear that “abstract ideas” like math formulas or gravity can’t be patented, and that specific applications that describe…

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