The Patent Office recently proposed (and requested comments on) a new set of rules designed to determine whether a patent application is directed to eligible subject matter. This has been a hot issue ever since the Supreme Court’s 2014 decision in Alice Corp. v. CLS Bank International. Since that case, many software and business method patents have been held invalid. However, in 2016 the Federal Circuit decided Enfish LLC v. Microsoft Corp, which carved a large exception from Alice. Courts since have upheld more software patents.
The PTO’s proposed rules now incorporate the Enfish ruling and broadly permits many forms of software patents. The key difference appears to be between algorithms that merely use generic computers to perform a task, and algorithms that make computers function better, such as more efficient database or more accessible graphical user interfaces.
For software developers, the proposed rules will likely make many more applications eligible for patent protection, provided they can be conformed to the new rules. For many companies, however, it appears that in the future there is an increased possibility there will be targets of patent enforcement efforts. It has been estimated that 60 percent of patent troll cases involve software or other similar technology.