A bleak future for Alice in Europe
In 2014, the US Supreme Court issued its decision in Alice v CLS Bank. This ruling was largely considered a landmark decision. Practitioners not only in the US but also in Europe have been discussing its implications. On the face of it, the Supreme Court’s decision concerned a so-called software patent. However, one should not conceive the Alice decision as an assault on software patents in general.
The reason why the Supreme Court found the patent invalid did not specifically relate to software. The court found that the patent covered an abstract idea of intermediated settlement. According to the court, using some unspecified, generic computer was not sufficient to transform that abstract idea into a patent-eligible invention. It also pointed out that the use of a computer could be sufficient to establish patent eligibility if the invention purports to improve the functioning of the computer itself or effect an improvement in any other technology or technical field.
Accordingly, the Alice decision did not affect software patents in general but patents covering abstract ideas including business methods. The Supreme Court made it very clear that such abstract ideas lack patent eligibility even if they are in the disguise of a computer-related invention with a minimal technical nature.
Still, at least some European practitioners have considered the Alice decision to be an indication of convergence between US and European patent practice. In addition, the impact of the Alice decision on the US patent application practice has made itself felt. The European Patent Office (EPO), which had previously refused to act as an international searching authority for US business method patent applications, abolished this limitation on Patent Cooperation Treaty work in November 2014.
In view of recent developments in US case law, in particular in view of the Alice decision and the Bilski v Kappos decision in 2010, the number of applications of US origin containing pure business methods had dropped dramatically. Furthermore, the EPO noticed that today’s US applications relating to business methods also often include some technical features which could indeed be patentable and thus searchable.
Not much convergence
From a legal point of view the Alice decision does not converge US and European patent practice considerably. Nevertheless, the practical result of what can be patented in the US and Europe may become increasingly similar. After all, the legal differences between US and European patent law may not have been that huge in the first place. The Alice decision merely confirmed that, as the Supreme Court’s 2012 Mayo v Prometheus decision had done before.
The European Patent Convention (EPC), which is the legal basis for the issuance of European patents, does not contain a positive definition of patentable subject matter. However, article 52(2) EPC excludes several fields from patentability, namely:
