Shopping on line can be easy, simple and save you lots of money. It can also take a lot of your time, frustrate you, and result in unwanted purchases. Now the same can be said for regular high street shopping, but with the vast opportunity presented by the Internet it will pay you to spend a few minutes reading this and understanding how to better optimize your Software Patent shopping experience:

1. Compare - without doubt the biggest advantage that the Software Patent offers shoppers today is the ability to compare thousands of Software Patent at a time. This is a great thing, but not necessarily all the time! Too much can be daunting at times so take advantage of the great comparison sites and where possible let them do the hard work for you.

2. Research - if it has been said it will be on the internet. Ignorance is no longer a justifiable reason for buying the wrong thing. Take the time to research in detail everything that you could possible want to know about

3. Testimonials - don't know anybody that has bought a Software Patent? Wrong! If the Software Patent is good the internet will let you know. Use the Internet as a friend and get testimonials before you buy.

4. Questions - Got a question about Software Patent then search the Forums, FAQ's, Blogs etc. Don't be afraid to ask .....

5. Reputation - Never heard of the company selling Software Patent? Don't worry, no reason why you should know every company in the world, but you know someone that does! Use the internet to find out what people are saying about Software Patent and build up a picture of their reputation for sales, returns, customer service, delivery etc.

6. Returns - still worried that even after all of the above your Software Patent wont be what you want? Check out the returns policy. There is so much competition now that someone, somewhere is bound to offer the terms that you are comfortable with.

7. Feedback - happy with your Software Patent then let people know, after all you are depending on others people input in your buying decision, so why not give a little back.

8. Security - check for the yellow padlock on the Software Patent site before you buy, and the s after http:/ /i.e. https:// = a secure site

9. Contact - got a question about Software Patent, or want to leave a comment then check out the sites contact page. Reputable companies have them and respond.

10. Payment - ready to pay for your Software Patent, then use your credit card or PayPal! Be aware of companies that don't accept them, there may be genuine reasons but given the huge amount of choice you have when buying online there is no reason at all not to buy via credit card or PayPal.

Software patent does not have a universally accepted definition.{{Cite web|url=http://softwarepatentwatch.wordpress.com/defining-software-patent|title=Defining a Software Patent|publisher=Public Patent Foundation is that a software patent is a "patent on any performance of a computer realised by means of a computer program". {{Cite web|url=http://www.ffii.se/erik/EPIP/img8.html|title="The Gauss Project"|publisher=[Foundation for a Free Information Infrastructure|accessdate=2007-05-30-->

There is software patent debate over the extent to which software patents should be granted, if at all.

Important issues concerning software patents include:

Debunking the Software Patent Myths |url=http://www.ipo.gov.uk/response-inventive.pdf|title=Public consultation on level of the inventive step required for obtaining patents|publisher=UK Intellectual Property Office|accessdate=2007-06-05--> and

Background A patent is a set of exclusionary rights granted by a state to a patent holder for a limited period of time, usually 20 years. These rights are granted to patent applicants in exchange for their disclosure of the inventions. Once a patent is granted in a given country, no person may make, use, sell or import/export the claimed invention in that country without the permission of the patent holder. Permission, where granted, is typically in the form of a license which conditions are set by the patent owner: it may be gratis or in return for a royalty payment or lump sum fee.

Patents are territorial in nature. To obtain a patent, inventors must file patent applications in each and every country in which they want a patent. For example, separate applications must be filed in Japan, China, the United States and India if the applicant wishes to obtain patents in those countries. However, some regional offices exist, such as the European Patent Office (EPO), which act as supranational bodies with the power to grant patents which can then be brought into effect in the member states, and an international procedure also exists for filing a single international application under the Patent Cooperation Treaty (PCT), which can then give rise to patent protection in most countries.

These different countries and regional offices have different standards for granting patents. This is particularly true of software or computer-implemented inventions, especially where the software is implementing a business method.

History and current trends Early example of a software patent On 1962-05-21, a British patent application entitled "A Computer Arranged for the Automatic Solution of linear programming Problems" was filed. The invention was concerned with Out-of-core algorithm for the simplex algorithm, and may be implemented by purely software means. The patent was granted on August 17, 1966 and seems to be one of the first software patents.Beresford, K (2000) Patenting Software under the European Patent Convention, London: Sweet & Maxwell, page 4. See also .

United States The United States Patent and Trademark Office has traditionally not considered software to be patentable, and granted 5 Jan 1971, and granted December 7, 1976 can be easily found using the Bessen/Hunt technique. Earlier patents may exist but US patent database does not permit full text searching for earlier patentsbecause by statute patents can only be granted to "processes, machines, articles of manufacture, and compositions of matter". In particular patents cannot be granted to "scientific truths" or "mathematical expressions" of them. This means that most of the fundamental techniques of software engineering have never been patented.

The USPTO maintained the position that software was in effect a mathematical algorithm, and therefore not patentable, into the 1980s. This position of the USPTO was challenged with a landmark 1981 Supreme Court of the United States case, Diamond v. Diehr. The case involved a device that used computer software to ensure the correct timing when heating, or curing, rubber. Although the software was the integral part of the device, it also had other functions that related to real world manipulation. The court then ruled that as a device to mold rubber, it was a patentable object. The court essentially ruled that while algorithms themselves could not be patented, devices that utilized them could. This ruling wasn't as straightforward as many would have liked, forcing many electronic device makers into the courts to establish that their inventions were in fact patentable.http://www.bitlaw.com/software-patent/history.html

Due to different treatment of federal patent rights in different parts of the country, in 1982 the U.S. Congress created a new court (the United States Court of Appeals for the Federal Circuit) to hear patent cases. The new circuit rejected rulings from some parts of the country and nationalized others. For example, the court made patents generally easier to uphold by presuming patents were valid unless proven invalid and weakening the defense of inventive step and non-obviousness. This court allowed issues, such as patentability of software, to be treated uniformly throughout the US. Due to a few landmark cases in this court, by the early 1990s the patentability of software was well established, and in 1996 the USPTO issued Final Computer Related Examination Guidelines. Final Computer Related Examination Guidelines

The recent expansion of the Internet and e-commerce has led to many patents being applied for and being granted for business methods implemented in software. There have been several successful enforcement trials in the USA, some of which are listed in the list of software patents article.

Europe Within European Union member states, the EPO and other national patent offices have issued many patents for inventions involving software since the European Patent Convention (EPC) came into force in the late 1970s. excludes "programs for computers" from patentability (Art. 52(2)) to the extent that a patent application relates to a computer program "as such" (Art. 52(3)). This has been interpreted to mean that any invention which makes a non-obvious "technical contribution" or solves a "technical problem" in a non-obvious way is patentable even if a computer program is used in the invention.

Computer-implemented inventions which only solve a business problem using a computer, rather than a technical problem, are considered unpatentable as lacking an inventive step (see T 258/03). Nevertheless, the fact that an invention is useful in business does not mean it is not patentable if it also solves a technical problem.

United Kingdom United Kingdom patent law is interpreted to have the same effect as the European Patent Convention such that "programs for computers" are excluded from patentability to the extent that a patent application relates to a computer program "as such". Current case law in the UK states that an (alleged) invention will only be actually regarded as an invention if it provides a contribution that is not excluded and which is also technical. A computer program implementing a business process is therefore not an invention, but a computer program implementing an industrial process may well be.

Japan Software is directly patentable in Japan. Examination Guidelines for Patent and Utility Model in Japan, Japanese Patent Office, May 2005

Other countries In India, a clause to include software patents was quashed by the Indian Parliament in April 2005.http://www.financialexpress.com/fe_full_story.php?content_id=86454

In Australia, pure or abstract methods of doing business are not considered to be patentable, but if the method is implemented using a computer, it avoids the exclusion for business methods.http://www.aipla.org/html/Patent-Handbook/countries/australia/AUsoftware.html

Patentable subject matter Patents are intended to promote innovation by encouraging the timely disclosure of how to make and use inventions and by protecting investments made to commercialize inventions. They attempt to accomplish this by requiring that a prompt and full disclosure is made by an inventor of how to make and use his/her/their invention and by granting a monopoly right for a limited period of time to a patent owner to prevent others from making, using or selling the invention in exchange for said prompt and full disclosure.

There is Software patent debate as to whether or not these aims are achieved with software patents.

Proposals In seeking to find a balance, different countries have different policies as to where the boundary between patentable and non-patentable software should lie. In Europe, a number of different proposals for setting a boundary line were put forward during the debate concerning the proposed Directive on the patentability of computer-implemented inventions, none of which were found acceptable by the various parties to the debate. Two particular suggestions for a hurdle that software must pass to be patentable include:



In the US, Ben Klemens, a Guest Scholar at the Brookings Institution, proposed that patents should be granted only to inventions that include a physical component that is by itself nonobvious.Wall Street Journal, 25 March 2006, p A9 WSJ link (subscription required) This is based on Justice William Rehnquist's ruling in the U.S. Supreme Court case of Diamond v. Diehr that stated that "... insignificant postsolution activity will not transform an unpatentable principle into a patentable process." By this rule, one would consider software loaded onto a stock PC to be an abstract algorithm with obvious postsolution activity, while a new circuit design implementing the logic would likely be a nonobvious physical device. Upholding an "insignificant postsolution activity" rule as per Justice Rehnquist's ruling would also eliminate most business method patents.

Obviousness A common objection to software patents is that they relate to trivial inventions. A patent on an invention that many people would easily develop independently of one another should not, it is argued, be granted since this impedes development. Different countries have different ways of dealing with the question of inventive step and non-obviousness in relation to software patents.

Inventive step test in Europe See Software patents under the European Patent Convention#Inventive step test and, for instance, T 258/03.

Perceived negative effects Compatibility There are a number of high profile examples where the patenting of a data exchange standards forced another programming group to introduce an alternative format. For instance, the PNG format was introduced to avoid the Graphics Interchange Format patent problems, and the Ogg Vorbis format was introduced to avoid the MP3 patent problems. If it is discovered that these new suggested formats are themselves covered by existing patents, the final result may be a large number of incompatible formats. Creating such formats and supporting them costs money, creates inconvenience to users and even threatens to split the Internet into several partially incompatible sub-networks (Advanced Systems Format and non-ASF, for example).

Defensive patents As another example, many software companies are of the opinion that copyrights and trade secrets provide adequate protection against unauthorized copying of their innovations.http://www.uspto.gov/web/offices/com/hearings/software/sanjose/sj_baker.html Companies such as Oracle Corporation and Red Hat are therefore generally opposed to the patenting of software.http://www.redhat.com/legal/patent_policy.html

Nonetheless, these companies do file and receive patents. Their stated rationale is that since their competitors get patents, they must get patents as well for defensive purposes. In the event that they get sued for patent infringement by a competitor they can counter sue using their own patents. The net result is that both companies often cross license each others' patents at little or no Out-of-pocket expenses for either party. However, the cost of developing a suitable portfolio of patents may be out of reach of many small software companies.

Conflicts Computer-implemented invention (CII) A microsite of the EPO website states that a generally accepted and widely used definition of a CII is "an invention whose implementation involves the use of a computer, computer network or other programmable apparatus, the invention having one or more features which are realised wholly or partly by means of a computer program."http://cii.european-patent-office.org/law_practice/index.en.php A similar definition is provided by The Guidelines for Examination at the EPO. EPO microsite on CIIs

The term has been criticized as a politically motived obfuscation manoeuver. Patents on computer-implemented inventions and pure software patents: what's in a name?

The EPO, in contrast, deny that they grant software patents. EPO CII Brochure They further argue that the term software patent is itself a misleading concept since it could imply that an invention must be in the form of software to count as a CII. The case law of the EPO T0158/88 and various national courts in Europe Judgment in CFPH's application states that a computer program cannot be patented in the guise of an object or as hardware if the underlying invention is still a computer program as such. Computer-implemented invention also covers inventions relating to computer control of processes external to a computer, such as ABS braking systems. Such inventions are not caught by many definitions of software patent, such as the one proposed by the Foundation for a Free Information Infrastructure.

Additionally, the EPO do not grant patents to all computer-implemented inventions since they must still provide a technical solution to a technical problem to be viewed as being Software patents under the European Patent Convention#Inventive step test, whereas the term software patent implies a granted patent. Nevertheless, the fact that the EPO deem that many software-related patent applications describe inventions is a point of contention.

Overlap with copyright Protection by patent protection and copyright constitute two different means of legal protection which may cover the same subject-matter, such as computer programs, since each of these two means of protection serves its own purpose. Decision T 1173/97 of the Boards of appeal of the EPO, July 1, 1998, Reasons 2.4 - see T 1173/97 on the EPO boards of appeal section of the EPO web site. Software is protected as works of literature under the Berne Convention for the Protection of Literary and Artistic Works, thus any software written is automatically covered by copyright. This allows the creator to prevent another entity from copying the program and there is generally no need to register code in order for it to be copyrighted.

Patents, on the other hand, give their owners the right to prevent others from using a claimed invention, even if it was independently developed and there was no copying involved. In fact, one of the most recent EPO decisions T 424/03 clarifies the distinction, stating that software is patentable, because it is basically only a technical method executed on a computer, which is to be distinguished from the program itself for executing the method, the program being merely an expression of the method, and thus being copyrighted.

Patents cover the underlying methodologies embodied in a given piece of software, or the function that the software is intended to serve, independent of the particular language or code that the software is written in. Copyright prevents the direct copying of some or all of a particular version of a given piece of software, but do not prevent other authors from writing their own embodiments of the underlying methodologies. Copyright can also be used to prevent a given set of data from being copied while still allowing the author to keep the contents of said set of data a trade secret.

Free and open source software There is Software patent debate in the free software community towards software patents. Much of this has been caused by free software/open source projects shutting downhttp://www.gnu.org/patent-examp/patent-examples.html when the holders of patents covering aspects of a project demanded license fees that the project could not or was not willing to pay or offered licenses under terms which the project was unwilling to accept.http://swpat.ffii.org/patents/effects

Several patent holders have offered royalty-free patent licenses. Companies that have done this include IBM, Microsoft, Nokia, Novell, Sun Microsystems and Unisys. Such actions have rarely appeased the free/open source community software community for reasons such as fear of the patent holder changing their mind or that the license terms were not found acceptable.

In the late 1990s, for example, Unisys, granted royalty free licenses to hundreds of not-for-profit organizations that used the patented LZW compression method and, by extension, the Graphics Interchange Format image format. Unisys was still barraged by negative and sometimes obscene emails from the free/open source software community. Unisys Not Suing (most) Webmasters for Using GIFs – Slashdot article from August 31, 1999

In 2005 Sun Microsystems announced that they were making a portfolio of 1,600 patents available through a free software license/open-source license-type patent license called Common Development and Distribution License. Sun Grants Global Open Source Community Access to More than 1,600 Patents, Sun press release, January 25, 2005. This was criticized by the free/open source software community, however, since it did not release the source code under a free/open source software license patent umbrella springs some leaks, Silicon Valley Sleuth, January 27, 2005

In 2006, Microsoft's patent pledge not to sue Novell Linux customers, openSUSE contributors, and free/open source software developers{{cite web]{{cite web| url = http://www.businessreviewonline.com/os/archives/2006/11/microsofts_deve.html| title = Microsoft’s developer patent pledge “worse than useless” says SFLC| date = 10| month = November| year = 2006--> while commentators from the Free Software Foundation stated that the agreement would not comply with GNU General Public License#Version 3.{{cite web| url = http://news.com.com/Microsoft+makes+Linux+pact+with+Novell/2100-1016_3-6132119.html| title = Microsoft makes Linux pact with Novell| date = 2| month = 11| year = 2006-->{{cite web| url = http://www.cbronline.com/article_news.asp?guid=C1856F2A-F214-4A65-A8C1-4B6CBC1CEED5| title = Microsoft patent deal could leave Novell behind| date = 24| month = 11| year = 2006-->

Draft versions of the GNU GPL version 3 may also conflict with patents on software by preventing any patent holder from enforcing their patents against a user if said patent holder also distributes software covered by those patents under the GPL. HP may fork the GPL Stephen Shankland, CNET News.com, Published: 03 Aug 2006 09:05 BST

Jurisdictions Substantive law regarding the patentability of software and computer-implemented inventions, and case law interpreting the legal provisions, are different under different jurisdictions.

Software patents under multilateralism treaty:

Software patents under national laws:

Litigation Several successful litigations show that software patents are enforceable in the US. See List of software patents for more examples.

Similarly in Japan, software patents have been successfully enforced. In 2005, for example, Matsushita won a court order barring Justsystem from infringing Matsushita's Japanese patent 2,803,236 covering word processing software. A Tokyo court ordered Justsystem to pull their product from the market. On September 30th 2005, Intellectual Property High Court of Japan, which was newly formed in April 2005, granted Justsystems’ appeal. The original decision by the Tokyo District Court was overturned in October 2005.

Licensing Patenting software is widespread in the US. As of 2004, approximately 145,000 patents had issued in the 22 classes of patents covering computer implemented inventions. (see table to the right).

Many software companies cross-licensing their patents to each other. These agreements allow each party to practice the other party's patented inventions without the threat of being sued for patent infringement. Often, there is no payment of any royalties between the parties. Microsoft, for example, has agreements with IBM, Sun Microsystems, SAP AG, Hewlett-Packard, Siemens AG, Cisco Systems, Autodesk IDG News Service and recently Novell. Microsoft cross-licensed its patents with Sun, despite being direct competitors, and with Autodesk even though Autodesk has far fewer patents than Microsoft.

The ability to negotiate cross licensing agreements is a major reason that many software companies, including those providing open source software, file patents. As of June 2006, for example, Red Hat has developed a patent portfolio of 6 issued US patents, 1 issued European patent, 13 pending US patent applications, and 25 pending international PCT (Patent Cooperation Treaty) patent applications. Red Hat uses this portfolio to cross license with proprietary software companies (e.g. Microsoft, IBM) so that they can preserve their freedom to operate.http://www.redhat.com/legal/patent_policy.html

Many software patent holders license their patents in exchange for monetary royalties. Some patent owners, such as IBM, are in the business of selling the products they patent and view licensing as a way to increase the return on their investment in innovation. IBM generates an additional $US 2 billion per year by licensing. Newsweek Article

Other patent holders are in the business of inventing new computer implemented inventions and then commercializing the inventions by licensing the patents to other companies that manufacture the inventions. Walker Digital, for example, has generated a large patent portfolio from its research efforts, including the basic patent on the Priceline.com reverse auction technology. US universities also fall into this class of patent owners. They collectively generate about $1.4 billion per year through licensing the inventions they develop to both established and start up companies in all fields of technology, including software.http://www.autm.org/events/File/FY04%20Licensing%20Survey/04AUTM-USLicSrvy-public.pdf

Still other patent holders focus on obtaining patents from original inventors and licensing them to companies that have introduced commercial products into the marketplace after the patents were filed. Some of these patent holders, such as Intellectual Ventures, are privately held companies financed by large corporations such as Microsoft, Intel, Google, etc. Others, such as Acacia Technologies, are publicly traded companies with institutional investors being the primary shareholders.http://premium.hoovers.com/subscribe/co/overview.xhtml?ID=fffrfkrhrrxhjcxxkh

The practice of acquiring patents merely to license them is controversial in the software industry. Companies that have this business model are pejoratively referred to as patent trolls. It is an integral part of the business model that patent licensing companies sue infringers that do not take a license. Furthermore, they may take advantage of the fact that many companies will pay a modest license fee (e.g.$100,000 to $1,000,000) for rights to a patent of questionable validity, rather than pay the high legal fees ($2,000,000 on up) to demonstrate in court that the patent is invalid.

See also

Notes a. The Foundation for a Free Information Infrastructure are an anti-software patent group and the material associated with their definition of a software patent suggests that the purpose of the definition is to identify patents that should not be granted as a matter of policy.

References External links

Economic studies | surname1=Bessen | surname2=Hunt | title=An Empirical Look at Software Patents | year=2004 | url=http://www.researchoninnovation.org/swpat.pdf -->. This paper includes a method of identifying software patents that has proved popular with organisations such as the Public Patent Foundation.

Books

Papers and presentations

Software patent does not have a universally accepted definition.{{Cite web|url=http://softwarepatentwatch.wordpress.com/defining-software-patent|title=Defining a Software Patent|publisher=Public Patent Foundation is that a software patent is a "patent on any performance of a computer realised by means of a computer program". {{Cite web|url=http://www.ffii.se/erik/EPIP/img8.html|title="The Gauss Project"|publisher=[Foundation for a Free Information Infrastructure|accessdate=2007-05-30-->

There is software patent debate over the extent to which software patents should be granted, if at all.

Important issues concerning software patents include:

Debunking the Software Patent Myths |url=http://www.ipo.gov.uk/response-inventive.pdf|title=Public consultation on level of the inventive step required for obtaining patents|publisher=UK Intellectual Property Office|accessdate=2007-06-05--> and

Background A patent is a set of exclusionary rights granted by a state to a patent holder for a limited period of time, usually 20 years. These rights are granted to patent applicants in exchange for their disclosure of the inventions. Once a patent is granted in a given country, no person may make, use, sell or import/export the claimed invention in that country without the permission of the patent holder. Permission, where granted, is typically in the form of a license which conditions are set by the patent owner: it may be gratis or in return for a royalty payment or lump sum fee.

Patents are territorial in nature. To obtain a patent, inventors must file patent applications in each and every country in which they want a patent. For example, separate applications must be filed in Japan, China, the United States and India if the applicant wishes to obtain patents in those countries. However, some regional offices exist, such as the European Patent Office (EPO), which act as supranational bodies with the power to grant patents which can then be brought into effect in the member states, and an international procedure also exists for filing a single international application under the Patent Cooperation Treaty (PCT), which can then give rise to patent protection in most countries.

These different countries and regional offices have different standards for granting patents. This is particularly true of software or computer-implemented inventions, especially where the software is implementing a business method.

History and current trends Early example of a software patent On 1962-05-21, a British patent application entitled "A Computer Arranged for the Automatic Solution of linear programming Problems" was filed. The invention was concerned with Out-of-core algorithm for the simplex algorithm, and may be implemented by purely software means. The patent was granted on August 17, 1966 and seems to be one of the first software patents.Beresford, K (2000) Patenting Software under the European Patent Convention, London: Sweet & Maxwell, page 4. See also .

United States The United States Patent and Trademark Office has traditionally not considered software to be patentable, and granted 5 Jan 1971, and granted December 7, 1976 can be easily found using the Bessen/Hunt technique. Earlier patents may exist but US patent database does not permit full text searching for earlier patentsbecause by statute patents can only be granted to "processes, machines, articles of manufacture, and compositions of matter". In particular patents cannot be granted to "scientific truths" or "mathematical expressions" of them. This means that most of the fundamental techniques of software engineering have never been patented.

The USPTO maintained the position that software was in effect a mathematical algorithm, and therefore not patentable, into the 1980s. This position of the USPTO was challenged with a landmark 1981 Supreme Court of the United States case, Diamond v. Diehr. The case involved a device that used computer software to ensure the correct timing when heating, or curing, rubber. Although the software was the integral part of the device, it also had other functions that related to real world manipulation. The court then ruled that as a device to mold rubber, it was a patentable object. The court essentially ruled that while algorithms themselves could not be patented, devices that utilized them could. This ruling wasn't as straightforward as many would have liked, forcing many electronic device makers into the courts to establish that their inventions were in fact patentable.http://www.bitlaw.com/software-patent/history.html

Due to different treatment of federal patent rights in different parts of the country, in 1982 the U.S. Congress created a new court (the United States Court of Appeals for the Federal Circuit) to hear patent cases. The new circuit rejected rulings from some parts of the country and nationalized others. For example, the court made patents generally easier to uphold by presuming patents were valid unless proven invalid and weakening the defense of inventive step and non-obviousness. This court allowed issues, such as patentability of software, to be treated uniformly throughout the US. Due to a few landmark cases in this court, by the early 1990s the patentability of software was well established, and in 1996 the USPTO issued Final Computer Related Examination Guidelines. Final Computer Related Examination Guidelines

The recent expansion of the Internet and e-commerce has led to many patents being applied for and being granted for business methods implemented in software. There have been several successful enforcement trials in the USA, some of which are listed in the list of software patents article.

Europe Within European Union member states, the EPO and other national patent offices have issued many patents for inventions involving software since the European Patent Convention (EPC) came into force in the late 1970s. excludes "programs for computers" from patentability (Art. 52(2)) to the extent that a patent application relates to a computer program "as such" (Art. 52(3)). This has been interpreted to mean that any invention which makes a non-obvious "technical contribution" or solves a "technical problem" in a non-obvious way is patentable even if a computer program is used in the invention.

Computer-implemented inventions which only solve a business problem using a computer, rather than a technical problem, are considered unpatentable as lacking an inventive step (see T 258/03). Nevertheless, the fact that an invention is useful in business does not mean it is not patentable if it also solves a technical problem.

United Kingdom United Kingdom patent law is interpreted to have the same effect as the European Patent Convention such that "programs for computers" are excluded from patentability to the extent that a patent application relates to a computer program "as such". Current case law in the UK states that an (alleged) invention will only be actually regarded as an invention if it provides a contribution that is not excluded and which is also technical. A computer program implementing a business process is therefore not an invention, but a computer program implementing an industrial process may well be.

Japan Software is directly patentable in Japan. Examination Guidelines for Patent and Utility Model in Japan, Japanese Patent Office, May 2005

Other countries In India, a clause to include software patents was quashed by the Indian Parliament in April 2005.http://www.financialexpress.com/fe_full_story.php?content_id=86454

In Australia, pure or abstract methods of doing business are not considered to be patentable, but if the method is implemented using a computer, it avoids the exclusion for business methods.http://www.aipla.org/html/Patent-Handbook/countries/australia/AUsoftware.html

Patentable subject matter Patents are intended to promote innovation by encouraging the timely disclosure of how to make and use inventions and by protecting investments made to commercialize inventions. They attempt to accomplish this by requiring that a prompt and full disclosure is made by an inventor of how to make and use his/her/their invention and by granting a monopoly right for a limited period of time to a patent owner to prevent others from making, using or selling the invention in exchange for said prompt and full disclosure.

There is Software patent debate as to whether or not these aims are achieved with software patents.

Proposals In seeking to find a balance, different countries have different policies as to where the boundary between patentable and non-patentable software should lie. In Europe, a number of different proposals for setting a boundary line were put forward during the debate concerning the proposed Directive on the patentability of computer-implemented inventions, none of which were found acceptable by the various parties to the debate. Two particular suggestions for a hurdle that software must pass to be patentable include:



In the US, Ben Klemens, a Guest Scholar at the Brookings Institution, proposed that patents should be granted only to inventions that include a physical component that is by itself nonobvious.Wall Street Journal, 25 March 2006, p A9 WSJ link (subscription required) This is based on Justice William Rehnquist's ruling in the U.S. Supreme Court case of Diamond v. Diehr that stated that "... insignificant postsolution activity will not transform an unpatentable principle into a patentable process." By this rule, one would consider software loaded onto a stock PC to be an abstract algorithm with obvious postsolution activity, while a new circuit design implementing the logic would likely be a nonobvious physical device. Upholding an "insignificant postsolution activity" rule as per Justice Rehnquist's ruling would also eliminate most business method patents.

Obviousness A common objection to software patents is that they relate to trivial inventions. A patent on an invention that many people would easily develop independently of one another should not, it is argued, be granted since this impedes development. Different countries have different ways of dealing with the question of inventive step and non-obviousness in relation to software patents.

Inventive step test in Europe See Software patents under the European Patent Convention#Inventive step test and, for instance, T 258/03.

Perceived negative effects Compatibility There are a number of high profile examples where the patenting of a data exchange standards forced another programming group to introduce an alternative format. For instance, the PNG format was introduced to avoid the Graphics Interchange Format patent problems, and the Ogg Vorbis format was introduced to avoid the MP3 patent problems. If it is discovered that these new suggested formats are themselves covered by existing patents, the final result may be a large number of incompatible formats. Creating such formats and supporting them costs money, creates inconvenience to users and even threatens to split the Internet into several partially incompatible sub-networks (Advanced Systems Format and non-ASF, for example).

Defensive patents As another example, many software companies are of the opinion that copyrights and trade secrets provide adequate protection against unauthorized copying of their innovations.http://www.uspto.gov/web/offices/com/hearings/software/sanjose/sj_baker.html Companies such as Oracle Corporation and Red Hat are therefore generally opposed to the patenting of software.http://www.redhat.com/legal/patent_policy.html

Nonetheless, these companies do file and receive patents. Their stated rationale is that since their competitors get patents, they must get patents as well for defensive purposes. In the event that they get sued for patent infringement by a competitor they can counter sue using their own patents. The net result is that both companies often cross license each others' patents at little or no Out-of-pocket expenses for either party. However, the cost of developing a suitable portfolio of patents may be out of reach of many small software companies.

Conflicts Computer-implemented invention (CII) A microsite of the EPO website states that a generally accepted and widely used definition of a CII is "an invention whose implementation involves the use of a computer, computer network or other programmable apparatus, the invention having one or more features which are realised wholly or partly by means of a computer program."http://cii.european-patent-office.org/law_practice/index.en.php A similar definition is provided by The Guidelines for Examination at the EPO. EPO microsite on CIIs

The term has been criticized as a politically motived obfuscation manoeuver. Patents on computer-implemented inventions and pure software patents: what's in a name?

The EPO, in contrast, deny that they grant software patents. EPO CII Brochure They further argue that the term software patent is itself a misleading concept since it could imply that an invention must be in the form of software to count as a CII. The case law of the EPO T0158/88 and various national courts in Europe Judgment in CFPH's application states that a computer program cannot be patented in the guise of an object or as hardware if the underlying invention is still a computer program as such. Computer-implemented invention also covers inventions relating to computer control of processes external to a computer, such as ABS braking systems. Such inventions are not caught by many definitions of software patent, such as the one proposed by the Foundation for a Free Information Infrastructure.

Additionally, the EPO do not grant patents to all computer-implemented inventions since they must still provide a technical solution to a technical problem to be viewed as being Software patents under the European Patent Convention#Inventive step test, whereas the term software patent implies a granted patent. Nevertheless, the fact that the EPO deem that many software-related patent applications describe inventions is a point of contention.

Overlap with copyright Protection by patent protection and copyright constitute two different means of legal protection which may cover the same subject-matter, such as computer programs, since each of these two means of protection serves its own purpose. Decision T 1173/97 of the Boards of appeal of the EPO, July 1, 1998, Reasons 2.4 - see T 1173/97 on the EPO boards of appeal section of the EPO web site. Software is protected as works of literature under the Berne Convention for the Protection of Literary and Artistic Works, thus any software written is automatically covered by copyright. This allows the creator to prevent another entity from copying the program and there is generally no need to register code in order for it to be copyrighted.

Patents, on the other hand, give their owners the right to prevent others from using a claimed invention, even if it was independently developed and there was no copying involved. In fact, one of the most recent EPO decisions T 424/03 clarifies the distinction, stating that software is patentable, because it is basically only a technical method executed on a computer, which is to be distinguished from the program itself for executing the method, the program being merely an expression of the method, and thus being copyrighted.

Patents cover the underlying methodologies embodied in a given piece of software, or the function that the software is intended to serve, independent of the particular language or code that the software is written in. Copyright prevents the direct copying of some or all of a particular version of a given piece of software, but do not prevent other authors from writing their own embodiments of the underlying methodologies. Copyright can also be used to prevent a given set of data from being copied while still allowing the author to keep the contents of said set of data a trade secret.

Free and open source software There is Software patent debate in the free software community towards software patents. Much of this has been caused by free software/open source projects shutting downhttp://www.gnu.org/patent-examp/patent-examples.html when the holders of patents covering aspects of a project demanded license fees that the project could not or was not willing to pay or offered licenses under terms which the project was unwilling to accept.http://swpat.ffii.org/patents/effects

Several patent holders have offered royalty-free patent licenses. Companies that have done this include IBM, Microsoft, Nokia, Novell, Sun Microsystems and Unisys. Such actions have rarely appeased the free/open source community software community for reasons such as fear of the patent holder changing their mind or that the license terms were not found acceptable.

In the late 1990s, for example, Unisys, granted royalty free licenses to hundreds of not-for-profit organizations that used the patented LZW compression method and, by extension, the Graphics Interchange Format image format. Unisys was still barraged by negative and sometimes obscene emails from the free/open source software community. Unisys Not Suing (most) Webmasters for Using GIFs – Slashdot article from August 31, 1999

In 2005 Sun Microsystems announced that they were making a portfolio of 1,600 patents available through a free software license/open-source license-type patent license called Common Development and Distribution License. Sun Grants Global Open Source Community Access to More than 1,600 Patents, Sun press release, January 25, 2005. This was criticized by the free/open source software community, however, since it did not release the source code under a free/open source software license patent umbrella springs some leaks, Silicon Valley Sleuth, January 27, 2005

In 2006, Microsoft's patent pledge not to sue Novell Linux customers, openSUSE contributors, and free/open source software developers{{cite web]{{cite web| url = http://www.businessreviewonline.com/os/archives/2006/11/microsofts_deve.html| title = Microsoft’s developer patent pledge “worse than useless” says SFLC| date = 10| month = November| year = 2006--> while commentators from the Free Software Foundation stated that the agreement would not comply with GNU General Public License#Version 3.{{cite web| url = http://news.com.com/Microsoft+makes+Linux+pact+with+Novell/2100-1016_3-6132119.html| title = Microsoft makes Linux pact with Novell| date = 2| month = 11| year = 2006-->{{cite web| url = http://www.cbronline.com/article_news.asp?guid=C1856F2A-F214-4A65-A8C1-4B6CBC1CEED5| title = Microsoft patent deal could leave Novell behind| date = 24| month = 11| year = 2006-->

Draft versions of the GNU GPL version 3 may also conflict with patents on software by preventing any patent holder from enforcing their patents against a user if said patent holder also distributes software covered by those patents under the GPL. HP may fork the GPL Stephen Shankland, CNET News.com, Published: 03 Aug 2006 09:05 BST

Jurisdictions Substantive law regarding the patentability of software and computer-implemented inventions, and case law interpreting the legal provisions, are different under different jurisdictions.

Software patents under multilateralism treaty:

Software patents under national laws:

Litigation Several successful litigations show that software patents are enforceable in the US. See List of software patents for more examples.

Similarly in Japan, software patents have been successfully enforced. In 2005, for example, Matsushita won a court order barring Justsystem from infringing Matsushita's Japanese patent 2,803,236 covering word processing software. A Tokyo court ordered Justsystem to pull their product from the market. On September 30th 2005, Intellectual Property High Court of Japan, which was newly formed in April 2005, granted Justsystems’ appeal. The original decision by the Tokyo District Court was overturned in October 2005.

Licensing Patenting software is widespread in the US. As of 2004, approximately 145,000 patents had issued in the 22 classes of patents covering computer implemented inventions. (see table to the right).

Many software companies cross-licensing their patents to each other. These agreements allow each party to practice the other party's patented inventions without the threat of being sued for patent infringement. Often, there is no payment of any royalties between the parties. Microsoft, for example, has agreements with IBM, Sun Microsystems, SAP AG, Hewlett-Packard, Siemens AG, Cisco Systems, Autodesk IDG News Service and recently Novell. Microsoft cross-licensed its patents with Sun, despite being direct competitors, and with Autodesk even though Autodesk has far fewer patents than Microsoft.

The ability to negotiate cross licensing agreements is a major reason that many software companies, including those providing open source software, file patents. As of June 2006, for example, Red Hat has developed a patent portfolio of 6 issued US patents, 1 issued European patent, 13 pending US patent applications, and 25 pending international PCT (Patent Cooperation Treaty) patent applications. Red Hat uses this portfolio to cross license with proprietary software companies (e.g. Microsoft, IBM) so that they can preserve their freedom to operate.http://www.redhat.com/legal/patent_policy.html

Many software patent holders license their patents in exchange for monetary royalties. Some patent owners, such as IBM, are in the business of selling the products they patent and view licensing as a way to increase the return on their investment in innovation. IBM generates an additional $US 2 billion per year by licensing. Newsweek Article

Other patent holders are in the business of inventing new computer implemented inventions and then commercializing the inventions by licensing the patents to other companies that manufacture the inventions. Walker Digital, for example, has generated a large patent portfolio from its research efforts, including the basic patent on the Priceline.com reverse auction technology. US universities also fall into this class of patent owners. They collectively generate about $1.4 billion per year through licensing the inventions they develop to both established and start up companies in all fields of technology, including software.http://www.autm.org/events/File/FY04%20Licensing%20Survey/04AUTM-USLicSrvy-public.pdf

Still other patent holders focus on obtaining patents from original inventors and licensing them to companies that have introduced commercial products into the marketplace after the patents were filed. Some of these patent holders, such as Intellectual Ventures, are privately held companies financed by large corporations such as Microsoft, Intel, Google, etc. Others, such as Acacia Technologies, are publicly traded companies with institutional investors being the primary shareholders.http://premium.hoovers.com/subscribe/co/overview.xhtml?ID=fffrfkrhrrxhjcxxkh

The practice of acquiring patents merely to license them is controversial in the software industry. Companies that have this business model are pejoratively referred to as patent trolls. It is an integral part of the business model that patent licensing companies sue infringers that do not take a license. Furthermore, they may take advantage of the fact that many companies will pay a modest license fee (e.g.$100,000 to $1,000,000) for rights to a patent of questionable validity, rather than pay the high legal fees ($2,000,000 on up) to demonstrate in court that the patent is invalid.

See also

Notes a. The Foundation for a Free Information Infrastructure are an anti-software patent group and the material associated with their definition of a software patent suggests that the purpose of the definition is to identify patents that should not be granted as a matter of policy.

References External links

Economic studies | surname1=Bessen | surname2=Hunt | title=An Empirical Look at Software Patents | year=2004 | url=http://www.researchoninnovation.org/swpat.pdf -->. This paper includes a method of identifying software patents that has proved popular with organisations such as the Public Patent Foundation.

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