Supreme Court Rules Software Patents Invalid-Without Ever Mentioning Software Once In the Decision

Posted by khalling 10 years, 10 months ago to Technology
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"What this means is that companies like Apple, IBM, Microsoft, Google and others have had the value of their patent portfolios nearly completely erased today. If they wish to remain compliant with Sarbanes Oxley and other laws and regulations of the Securities and Exchange Commission they will need to level with their shareholders and tell them that their patent portfolios have been decimated."

db is on a plane headed to the Atlas Summit to give a talk about Galt as Inventor. When he gets off the plane, this news will greet him. Imagine a MODERN patent system understanding the manufacturing age but not the information age....


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  • Posted by $ blarman 10 years, 10 months ago in reply to this comment.
    I will point out a significant flaw in your logic: your own body. By your argument, because you did not create your own body, the government has the right to tell you what you can and can not do with your own body. This is clearly absurd.

    Property rights exist independent of the government. Government RECOGNIZES rights and enforces penalties on those who abrogate others' rights, but it neither creates nor grants rights.

    A patent is a recognition of a property right and its exclusive use.
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    Posted by $ blarman 10 years, 10 months ago in reply to this comment.
    If you own a piece of land, you have the primacy of right to use that land, do you not? Anyone who wishes to use that land must get your permission or pay you for the privilege, or they will be engaging in unlawful use, will they not?

    How is this ANY different than owning a patent? Does not the government enforce the rights of a patent by declaring the terms of unlawful use? Do you not have to grant permission in order for others to lawfully use your patented ideas?

    The fact that you and you alone determine who can legally use that idea is by very definition monopolistic use. There can be no other interpretation that passes muster.
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  • Posted by $ blarman 10 years, 10 months ago in reply to this comment.
    As a software developer of 20 years, you have your facts wrong, and not just wrong but horribly, fundamentally wrong. You can not develop software without a fundamental understanding of mathematical principles, including sort algorithms, cryptographic methods, etc. You're just flat-out wrong. Look at the curriculum for any computer science degree and there is a TON of math there: calculus, vector calculus, discrete math, etc. Try passing a compilers class without a solid foundation in math. My dad is an electrical engineer and he took classes on those plus thermodynamics (more math), materials (yet more math), and circuit design (more math). Good grief, the fundamental principles of a circuit are built on Ohm's law, which mathematically quantifies the relationship between current, voltage, and power.

    You also make another fundamentally incorrect conclusion: that it is the circuits that make something "patentable". If so, NO software qualifies as patentable. The whole reason you build computers is to allow one to change those circuits or pathways on the fly in response to other conditions! The "circuits" you are talking about in software don't exist for longer than it takes to execute a single instruction before moving on!

    I am left to shake my head in shock. It is all I can do.
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  • Posted by conscious1978 10 years, 10 months ago in reply to this comment.
    And it's important to note that "monopoly" is mentioned as part of the "objection to the patent laws" cited by some people - not as part of her definition of a patent.
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  • Posted by 10 years, 10 months ago in reply to this comment.
    "As an objection to the patent laws, some people cite the fact that two inventors may work independently for years on the same invention, but one will beat the other to the patent office by an hour or a day and will acquire an exclusive monopoly, while the loser’s work will then be totally wasted. This type of objection is based on the error of equating the potential with the actual. The fact that a man might have been first, does not alter the fact that he wasn’t. Since the issue is one of commercial rights, the loser in a case of that kind has to accept the fact that in seeking to trade with others he must face the possibility of a competitor winning the race, which is true of all types of competition." Capitalism: The Unknown Ideal, p. 133
    This is the only reference I can find that uses the word monopoly with patents and within the context of the paragraph, she clearly disagrees.
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.
    1st under natural law, Sir William Blackstone and the Constitution defined it as a natural right. It is a property right for the same reasons you have rights in land.

    There is really no such thing as an improvement patent. Every invention is a combination of existing elements, because of conservation of matter and energy and every invention improves on something.

    The patent holder has a right to exclude anyone from making, using, selling, importing their invention. It does not place any restrictions on what inventions might build on it. In fact that would defeat one of the purposes of patents. People get patents to secure their property rights so they can commercialize their invention. Almost always you can buy their invention from them and then use it as you wish. The sale of a item that incorporates the patent from the patent holder/licensee comes with a license to use that instance of the invention.
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  • Posted by Robbie53024 10 years, 10 months ago in reply to this comment.
    You raise a good point - our society has lost most of the self-instilled honor and principles of the past. We demand that every action be specifically regulated. That is not how a free society exists. A free society has, and needs, few laws. Only a totalitarian state needs laws to specify all action/inaction.
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  • Posted by 10 years, 10 months ago in reply to this comment.
    I appreciate your response. and that is a fine alma mater for sure. bet we canoed the same rivers. ;)
    Where you would find common ground with db, I bet, would be the whole lawyer approach-even in patent law. If you think it got heated in here, imagine db debating lawyers who look at all legal issues pragmatically and completely devoid of moral foundations, firm definitions, logic and reason. It leads to laws which are inconsistent, nonsensical, and contradictory and then opinions (from the lawyers) based on all that nonsense and contradictory thinking. When instead where there is confusion, people should start from the logical foundations and remain consistent. No wonder people look at the legal profession as ridiculous. I agree completely with your comments regarding our current system. Let us know how your research goes.
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  • Posted by Zenphamy 10 years, 10 months ago in reply to this comment.
    Yes, it's indeed interesting that Edison improved on Swan, then Swan improved on Edison, the others beyond that. It speaks well of the intent of the founders in prioritizing the patent in the Constitution. And I think that Einstein's work as a patent clerk in Switzerland (?) adds gravitas to the profession.

    My understanding of the monopoly situation of the invention/improvement is that the original patent holder can place restrictions on the improvement patent. True?
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  • Posted by Zenphamy 10 years, 10 months ago in reply to this comment.
    khaling; I appreciate both db's and your intensity with this matter, both specifically to this case and generally to the state of current Patent law and decisions such as this one. By the way, I just finished db's suggested links to his writings on this case and other issues such as monopoly vs property rights of a patent as well as some of the filings in the case (I'm taking a break before I chase down the applications, but it interests me enough to want to do so), so I've gained a better understanding of his dissension toward some of my comments. I'm also going to have to go back to some of my earlier AR readings because I'm pretty positive that she described patents as both property rights and government sanctioned and limited monopolies.

    But his personal attacks were unwarranted under any circumstance. There's not a socialist, Marxist bone in this old Objectivist body and I challenge anyone that's a stronger and more dedicated proponent of natural and property rights. And my ability to comprehend patent claims goes back a long number of years with some excellent tutelage from a number of Phd professors and Engineering firms along the way. My early Electrical Engineering education was obtained at the University of Mo - Rolla in a 5yr BS rather than the normal 4yr program offered in most universities, which gave me a shortcut to my MS and work toward a Phd. I was lucky enough in those years to obtain significant experience in applied EE as well as design, project and contract management and later to establish, build, and manage a successful, multi-state business with up to 500 employees.

    Secondly, I find in general, that I feel as much intensity in my own opinions of what our system of law in whole has become. Every decision, every lobby, each lawyer politician have all pulled us farther and farther away from the intent of the Founders and the core values of the Enlightenment that the citizen should not be subjected to laws which he could not read and understand with a commonly obtained education. Current law and decisions in nearly every area is so convoluted and semanticized as to be nearly incomprehensible, by even many of it's practitioners. Which is another topic for another day's discussion.

    But that said, I'm strongly supportive of the desire I sense from both of you, that Patent cases and law should be written and decided by only those with the acceptable levels of expertise and also that the law needs clarification as it applies to not only software, but intellectual property and business technology as well.

    Hope this provides some reduction of the generated heat of this issue.
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  • Posted by 10 years, 10 months ago in reply to this comment.
    the cost of obtaining a US patent is probably between 10-30K depending on level of tech and how expensive the firm you use. Maintenance fees add 7K over life of patent.
    Litigation is OVER a million if you go through trial. Appeals add more. We are talking well over 5M. Those costs are outrageous. Partly, it is due to rulings such as this one, which has easily doubled the cost of software applications moving forward (according to this article). and partly due to our federal rules of discovery which makes all federal lawsuits ridiculously expensive. db does not litigate, but if he was a litigator representing a client who has been accused of infringement, this ruling (along with others recently) would be very important. If your case will not stand up on your innocence-much better to argue invalidating the patent. Imagine I want to accuse someone of infringement. I have a granted patent. I now take the risk the court will not start with the assumption I have valid property. Is it worth the risk for me to sue? What is the value of getting a patent if that is the case? these kinds of rulings hurt the startups and small inventors the most. The large companies can litigate all day long and do. Trust me, they are VERY happy with this ruling.
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  • Posted by 10 years, 10 months ago in reply to this comment.
    I think it should read, "Really[?]" The rest of the first sentence is a comment Zen made. The next sentence should read "No, what [SCOTUS] is arguing is metaphysical impossibilities. The argue[ment] is outrageous...."
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.
    It is a system for settling international financial transactions that reduces settlement risk. It uses computers and communication systems. The other side and the Supreme Court said this was well known. They said it was just a computerized escrow arrangement. Actually, the claims do not cover an escrow arrangement and CLS could have used a computerized escrow system without violating Alice's invention.

    This case was not even about whether Alice's invention was novel, it was about whether it was directed to an invention. The Supreme Court has created an exception to patents for "abstract ideas." But of course they refuse to define what they mean. All inventions are an abstraction of a number of specific instances. So this allows them to invalidate any patent they don't like. In this case they don't like patents on software implemented inventions and they do not like patents in the financial space (protecting Wall Street) and they really don't like the combination.
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  • Posted by Zenphamy 10 years, 10 months ago in reply to this comment.
    But isn't that the exact situation we find ourselves in today as it relates to patents? Who else will or even can be vigilant to the threat of looters of the patent? Don't you have to hire an attorney and pay the cost of pursuing a patent infringement?

    I agree that devolving to a medieval state isn't going to work. Yes, I agree that the proper (and most essential) function of government is the protection of the property rights of it's citizens and I also agree that patents are property rights. But I can't imagine that government can or should provide the vigilance.

    It becomes a quandary. I read recently somewhere that the cost of patent application and maintenance is something like $100K (?) and that pursuing an infringement suit and action is easily $1M if not settled out of court. It appears that we somehow need to enforce honor and integrity or at least instill them. I wonder why we can't refer an infringement claim to the Patent Office, that they perform the investigation and then prosecute.

    Maybe a good candidate for a separate Post.
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.
    You cannot create something from nothing, conservation of matter and energy, so no invention has "completely novel elements." What is novel is the combination.

    Try this. Think of an invention and then think of the components at some level you will see that all those components were known before the invention was made. For instances a LASER. Ruby rods were known, Fabry Perot Etalons (mirrors) were known, flash lamps were known, and the MASER existed before the LASER.

    In fact there is another part of patent law that requires you to provide a description that one skilled in the art can use to practice the invention. If one of the elements were completely new, it would be unknown to those skilled in the art, which means they could not practice the invention. And therefor should not obtain a patent.
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.

    Posted by dbhalling 39 minutes ago
    High level software is converted by a compiler into assembly code or other lower level language. This is converted by computer into voltage levels, which set the states of various transistors. This means that you are wiring an electronic circuit.

    You realize that anything done is software can be done in hardware - because it is done by hardware. The reason an electrical engineer decides to implement a solution in software or hardware (or the numerous other choices in between) has to do with a trade between speed versus flexibility.

    If you just look at the history of computers, the whole point was to create a flexible way of wiring logic (digital) circuits.

    "algorithms, software, and applied mathematics in engineering physics" How does it do this? By changing voltages that change the states of transistors and the voltages on capacitors - electronic circuit.

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  • Posted by 10 years, 10 months ago in reply to this comment.
    that is a circular statement. When I acquire a lot,of land, even if I do not "improve" the lot before selling it, I had to have traded my creation in something else, we're back to creation
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.
    Every invention in the history of the world is a combination of known or existing elements. We know this because of conservation of matter and energy. Thus if you define novel as having an element in a claim that is totally unknown it would violate physics. This allows the judges to say each element was known, so you should not obtain a patent. Thus my black magic comment.

    Socialist like this formulation because it sets up a metaphysical impossibility destroying peoples' ability to think.
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.
    I doubt it. I believe suspension bridges have been around long before the US. However, inventions usually are actually much more narrow than this broad category. So there may be patents even today on specific aspects of suspension bridges.
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.
    Patents do not require "that people not think in correct mathematical principles." Patents on cryptography have to do with implementing them in an electronic circuit, perhaps a computer. That is what the patent protects.
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  • Posted by dbhalling 10 years, 10 months ago in reply to this comment.
    See my comment on human creation. Mathematics is descriptive of a logical system. It does not have a repeatable, objective result as in science that is independent of the observer. Math just sits there on the page. Clearly, it is a logical system and the result of a person applying the logical system results in an objective answer, which just sits there on the page, i.e., it is descriptive.
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