Microsoft v. AT&T: Transnational Patent Law At The Supreme Court

Microsoft v. AT&T (Supreme Court 2006)

Transnational patent law is a hot topic, and one the Supreme Court cannot ignore. The issue de jour involves the question of unauthorized export of patented software.  AT&T holds the speech compression patent that is infringed by Microsoft Windows. (RE 32,580). Microsoft exports the software code from Redmond to various international locations.  Once abroad, the code is then copied and installed in computers that are then sold abroad.  As the invention is claimed, the code alone does not infringe. Rather, infringement would only occur once the code is combined with the computer hardware. 

Under traditional notions of patent law, Microsoft’s actions are not infringement because the code alone does not infringe the patent, and (for the purposes of this case) the code is not combined with the hardware within the U.S. 

Here, however, traditional notions of territoriality have been supplanted by statute.  Under 35 U.S.C. 271(f), supply of only a portion of a component of a patented invention from the U.S. can be infringement.

35 U.S.C. 271(f) prohibits the “suppl[y] . . . from the United States . . . [of] all or a substantial portion of the components of a patented invention . . . in such manner as to actively induce the combination of such components outside of the United States,” as well as the “suppl[y] . . . from the United States [of] any component of a patented invention that is especially made or especially adapted for use in the invention.” 

Microsoft, of course, wants to avoid infringing the U.S. patent for its activity abroad and gives two separate reasons why its activity of exporting software do not fall within the parameters of 271(f). (I) Software code is an intangible string of information not a “component” as required by the statute. (II) Because copies of the code were used to create the infringing software/hardware combination, no physical particle that Microsoft exported actually became part of the finished product.  According to Microsoft, this means that nothing in the infringing combination was actually supplied from the U.S. as required by the statute. I term these two arguments the tangibility requirement and the molecular conservation requirement.

Microsoft and its supporters have now filed their merits briefs to the Supreme Court, and my reading of their arguments is that there is strong support for molecular conservation, but only weak support for tangibility. The Bush Administration supports this distinction in its brief filed jointly by the DOJ and PTO. 

On tangibility, the Government argues that software can certainly be a component, and that the statute is not limited to “only tangible components” as Microsoft suggests. Although not cited by the Government, Section 271(c) provides a statutorily distinct way of limiting components.  In referring to infringement through importation, that clause identifies only components of certain types of inventions such as machines and compositions.

On molecular conservation, the Government correctly notes that the statute requires that the exported components be the same components that are combined in the infringing manner. “Conduct that merely induces the combination of foreign-made components does not violate Section 271(f).” The statute, according to the Gov’t, leaves foreign manufacturers “free to manufacture and assemble copies of the identical components overseas” so long as none of the components actually assembled were made within the US.  Applying their argument to this case, we know that the software was copied and only those copies were combined with hardware in a would-be infringing manner.

A group of electronics companies led by Amazon filed a colorful brief that also supports the requirement of molecular conservation.

No matter where their unique arrangement was invented or dictated, if each molecule in the machine was supplied from outside the U.S., then no component was supplied from the U.S. In the present case, Microsoft did not supply even a single molecule of the foreign machines at issue.

Amazon also raises the slippery slope issue.  According to the brief, if Microsoft is liable here, then the Court would open the door to infringement for export of blueprints or a CAD/CAM design scheme.  That result, the brief argues, goes against congressional intent. As an aside, Amazon cited Wikipedia but did not include it in its list of “authorities.”  Although they do not cite it, the Pellegrini case holds that plans or instructions for a patented item cannot serve as components under 271(f).

In support of the molecular argument, a group of professors led by professors Lemley (Stanford) and Duffy (GWU), looked appropriately at the language of 271(f):

[A]s a matter of grammar that the phrase “such components” refers back to the components that have been “supplied” from United States. Thus, the plain language of the statute requires that inducing an extraterritorial combination constitutes an act of infringement if and only if the combined components are in fact the same components that were “supplied in or from” the United States.

For the professors, supplying exact copies does not meet the requirement. Most of the briefs come-up with some hypothetical metaphor to explain their situation — a guy memorizing some code and flying on an airplane, a hard-copy print out of some code that runs a fuel-injection system, CAD/CAM instructions, blueprints, etc.  The idea apparently is that if we allow copies of software to be considered components, then these situations necessarily also provide for infringement actions.  More accurately, however, they are just poor hypotheticals.

Software as Patentable Subject Matter: The anti-patent activist group SFLC led by Dan Ravicher and Eben Moglen also filed a brief that may be the dark-horse of this debate.  Their brief asks the Court to take a fresh look at the patentability of software.

Software can not be a “component[] of a patented invention” under 35 U.S.C. § 271(f) because software is not patentable subject matter under 35 U.S.C. § 101. As such, the Federal Circuit’s holding to the contrary in this case is erroneous and should be reversed.

It would be odd for the Court to decide the 101 issue in this case after dismissing LabCorp earlier this year.  However, I expect at least one concurring opinion supporting the ideas in this brief.

Impact on Software Industry: If Microsoft loses here, it will at least have a clear avenue to avoid future infringement. Unfortunately for US business, that avenue is to move all software development activities abroad so that components are never exported. This harmful effect was recognized and discussed in SIIA’s brief. SIIA is an industry group of software & technology companies who want to continue to design products in the US, but manufacture those products abroad. This argument is punctuated by BSA’s questionable hyperbole: “The purpose of patent protection is to encourage domestic innovation, not to drive it overseas.”

Impact in Biotech: Although not yet a viable industry, this could have a potentially large impact on biotechnology patent issues.  Like software, DNA code (or other biologics) could be shipped from the U.S. to be copied abroad and incorporated into an organism in an infringing manner.  Even more abstract, the export may merely involve transmitting a sequence listing that would be used to reproduce the sequence abroad.  Any decision on software should consider the potential impact on these areas as well.

Methods: What Professor Wegner has called the “Bizarre Twist” of this case involves the CAFC’s notion of export of components of method claims. In Union Carbide v. Shell, the court found that methods could indeed have components, and those included items used in the method (such as a catalyst).  Thus, in that case, the defendant could be held liable for exporting a stock catalyst if it intended to use the ingredient in a would-be infringing manner. Shell settled its case with Union Carbide, but has filed an amicus brief in this case, arguing that the Federal Circuit “seriously erred” by declaring that “every form of invention eligible for patenting falls within the protection of section 271(f).” 

Statutory Construction Excludes Methods?: Shell compares the use of the term “component” in 271(f) its use in 271(c) — the section addressing importation.  In 271(c), Congress explicitly limited components to “component[s] of a patented machine, manufacture, combination, or composition,” but also included a provision excluding importation of materials used in a patented process.  Shell’s argument: because 271(f) does not include the provision discussing materials used in a patented process, it cannot cover processes.  Of course, the unstated counter-argument to shell is that components discussed in 271(c) are specifically limited to components of machines, while 271(f) components are not so limited — indicating that “component” in 271(f) should receive a broader interpretation.

International Law: All of the transnational patent issues have an impact on international law issues. FICPI, a Swiss-based organization of patent folks filed its brief asking the the U.S. to keep its patents territorial and avoid stomping on the toes of others (as “young nations” are bound to do). FICPI’s implication that the Supreme Court is bound by the Paris Convention is plainly wrong.  The Paris Convention is not U.S. law. However, their point is well-taken, if 271(f) covers software, it thwarts the efforts of other countries to eliminate software patents.


  • On the Merits
  • On Petition for Certiorari
  • Important recent 271(f) cases:

    • NTP v. Research in Motion, (271(f) “component” would rarely if ever apply to method claims).
    • AT&T v. Microsoft, 414 F.3d 1366 (Fed. Cir. 2005) (271(f) “component” applies to method claims and software being sold abroad);
    • Union Carbide v. Shell Oil (Fed. Cir. 2005) (271(f) “component” applies to method claims).
    • Eolas v. Microsoft, 399 F.3d 1325 (Fed. Cir. 2005) (271(f) “component” applies to method claims and software);
    • Pellegrini v. Analog Devices, 375 F.3d 1113 (Fed. Cir. 2004) (271(f) “component” does not cover export of plans/instructions of patented item to be manufactured abroad);
    • Bayer v. Housey Pharms, 340 F.3d 1367 (Fed. Cir. 2003) (271(g) “component” does not apply to importation of ‘intangible information’).


    • I will be updating this page as more briefs are filed.
    • I will be talking about cross-border liability at Santa Clara University’s 25th Annual Computer & High Technology Law Journal Symposium on January 26 in San Jose. Information here.

    36 thoughts on “Microsoft v. AT&T: Transnational Patent Law At The Supreme Court

    1. 35

      Dan Gold:

      Software is difficult to reverse engineer ???!!!!
      What have you been smoking?
      How many lines of code of you written?

      In terms of software benefiting from the patent system, this is especially true of startups. The big fear of MANY startups is Microsoft copying the product (don’t worry, they’ll figure out how to reverse engineer it – it’ll come out 20% less functional, but they’ll do it) and bundling it in their Operating System. then they cry out ‘how technology of many patents’ is needed in a single product.

      If the Startup has the ‘right to exclude,’ this allows them to compete against big companies with market channels.

      Often customers want the technology but are wary of buying from a small company – they would prefer to buy from a large company. But of course, if the small company will lose out to the large company, they have no incentive to develop the product in the first place.

      Yeah, I agree that software patents are not required for big rich BSA companies – they already HAVE the market channels.

      This is ALL simple stuff.

    2. 34

      I’ve done a fair amount of studying of software patents (LLM degree).

      Essentially, the problem is that most lawyers do not understand enough about economic theory, innovation theory or the effects of patents to recognize why software patenting is a bad idea.

      The court works from a very simple “more patents = more innovation” model, that hasn’t really incorporated anything learned in economic theory about innovation in the last 30 years. They know the technical laws, they “know” that more patents must be good, they think IP = “property”, and that’s about it.

      There’s no understanding that different industries benefit different;y from the patent system. What is good for the chemical industry (or lawn care), does not work well for software.

      There are many reasons for this, but two big ones are the cost to innovate versus the cost to imitate (essentially software is cheap to make and difficult to reverse engineer) and the fact some industries, like software, are cumulative using hundreds or thousands of recently invented ideas to make a new product. In these sorts of industries patents just get in the way and slow things down – basically the lawyers make the money instead of the software engineers.

    3. 32

      Does Union Carbide cover foreign medical use? If so, you can not export a drug which has a secondary new medical use even if the drug is anticipated as product.

    4. 31

      In a typical case under 271(f), someone in a foreingn country does create the combination, make the copies, or use the method of the component(s). I am afraid that the person is liable for the infringement under 271(b) if he or she induces the exportation of the component from U.S. If so, foreing parties always have to consider U.S. patent. It is a too heavy and slightly silly burden, I think.

    5. 30


      “Except that we went for decades without software being patentable and those years were the most dynamic and productive years in software. Now software gets patented apparently on the intellectual sophistry that the invention is not really just an algorithm but rather an algorithm that will be combined with a computer.”

      Wouldn’t that same logic hold for any industry? I have heard the same argument from the electronics industry, the biotechnology industry, and now the industry that creates test tools for chemistry and biotechnology. If we do away with patents for software because it impedes software development, then why not do away with patents in all high technology areas for the same reason? Either that, or provide for compulsory licensing, as some people have suggested.

    6. 29

      “The problems with trying to tweak the patent system is unintended consequences. Change the system so that software patents are no longer permitted, and suddenly you may find that a process for forming steel is no longer patentable. Take care for what you wish for, you might get it.”

      Except that we went for decades without software being patentable and those years were the most dynamic and productive years in software. Now software gets patented apparently on the intellectual sophistry that the invention is not really just an algorithm but rather an algorithm that will be combined with a computer.

    7. 28


      It could be that I was imprecise. My point is that I do not think there needs to be a transfer of molecules at all. While we could go into dozens of examples, I think all of us could think of some.

      I find your comments regarding patents as a barrier somewhat humorous because of the industry I am in. A man by the name of Berrios got some key patents for control configurations for walk behind mowers in the late 80’s. After trying to break his patents through various means, people eventually paid him a royalty while decrying that his patents were a barrier to progress in the lawn and garden industry (which seemed reminiscent of your statement). Of course, the real barrier was the $50 or so that people had to pay to use his configuration, which many people elected to do. In the meantime, other configurations have been developed with some measure of success, and everyone continues to wait in anticipation for the expiration of the patents in a few years.

      The problems with trying to tweak the patent system is unintended consequences. Change the system so that software patents are no longer permitted, and suddenly you may find that a process for forming steel is no longer patentable. Take care for what you wish for, you might get it.

      Smiley face!

    8. 27


      You misattribute to me a quote about moving molecules. I think the point of the original post was that there was no physical movement of molecules from the install disk to the hard drive. That a disk drive (or CDROM drive )generates an electrical signal which after intermediate steps and processing results in a magnetic field being applied to the surface of a harddrive so that the magnetic orientation of some molecules on or near the surface of the hard drive gets changed is very different.

      That the contestants in the Netflix contest have to exercise extra ingenuity to design around existing patents is hardly an example of the patent system promoting progress in a way which justifies the existence of the system. My point is that the patent system appears to be an obstacle to solution of the problem rather than a help.

    9. 26

      I have several comments to previous posts:

      Joe Smith: You state that you “…have yet to install any software on any computer hard drive where the contents of the disk magically transform into something that becomes a part of a computer’s molecular structure….” I was under the impression that storage involved changing the configuration of atoms or molecules so that they represented ones and zeroes. I believe there are patents that involve changing the orientation of molecules and atoms, especially for the very storage purpose that you mention. I would think that storing a program on a disk or computer causes the structure thereof to change and thus becomes part of the molecular structure.

      Joe Smith: In a separate post you wondered how patents promote progress. Your very comment provided the answer. You stated that the prize was for software that did not infringe any existing patents. Assuming that such software could be written, then the achieved software would by definition meet the goal of patents to progress the state of the art and to desseminate information in exchange for a temporary monopoly. The one thing our forefathers failed to consider was the pace of technology development. In their day the commercial life of an invention could easily be decades. In some technology areas an invention can be completely supplanted in five years, or less. An argument that seems to be used infrequently is how some patents effectively become blocking patents because they are keys to advancement in a particular area.

      And lastly:

      MaxDrei: As Dennis Crouch pointed out, the Paris Convention is not self-executing. Even if it was self-executing, to the extent that it would be used as a law in application to U.S. entities, the Supreme Court would have jurisdiction over constitutionality and interpretation of law. The Supreme Court regularly throws out laws as unconstitutional or redefines laws based on their understanding of how the law was written or needs to be interpreted in light of the constitution. If the Paris convention somehow violated the constitution, you can be sure that the Supreme Court would say it could not be enforced as law within U.S. jurisdiction.

      I have a more fundamental problem with the U.S. We have adjudicated bribery cases where the acts took place on foreign soil and where the bribery was not illegal, or may even have been considered customary. Of course, the defendants were U.S. citizens. The U.S. has also applied Sarbanes-Oxley to foreign components of domestic companies. Now the U.S. wants to rule on “plans and procedures,” because software code is essentially a plan or procedure to cause an outcome, on foreign soil. At what point does someone say that the U.S. has jurisdiction over its citizens only when its citizens are on foreign soil at government request (soldiers and other government representatives) or when the citizen is directly contravening the constitution (plotting overthrow of the government, etc.)? It seems to me that eventually the U.S. will take authority for action against any entity that has either representation or origin in the U.S. regardless of where the causal action took place. This patent case seems like one more step down this road.

    10. 24

      Thanks Brad Hattenbach, for getting us back to the thread. I am a reader from outside the USA and should be most interested to read how International Treaties that are signed by the US Govt are given effect, within USA. What difference does it make, to the Rule of Law inside USA, whether USA has signed an International Treaty that bears on the legal issue? At the moment, I am inferring that “the USA” is bound by Paris but “The Supreme Court” is not. Given that the USA signed the Paris Convention, what is it, 100 years ago, it is to me surprising to read that the Supreme Court can ignore it. I am also thinking “Hilmer”.

    11. 23


      I do not understand your statement that “FICPI’s implication that the Supreme Court is bound by the Paris Convention is plainly wrong. The Paris Convention is not U.S. law.” The Paris Convention absolutely has the force of law and the SC is bound by it. Check your CON law notes.

      Article VI states:

      This Constitution, and the laws of the United States which shall be made in pursuance thereof; and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding.

      The Paris Convention is a treaty to which the U.S. is a party and is codified at 21 U.S.T. 1583.

      The SC recognized the force of treaty obligations in Whitney v. Robinson, 124 U.S. 190 (1888): “By the Constitution, a treaty is placed on equal footing, and made of like obligation, with an act of legislation. Both are declared by that instrument to be the supreme law of the land, and no supreme efficacy is to be given to either over the other.”

    12. 22


      A lot of the contestants are, or claim to be, small time guys working in their spare time. A lot of the contestants are offshore. The small timers and the off shore guys are extremely unlikely to have filed for patents. There may be a few of the players who have filed – the two leaders are both associated with universities – but I expect that they will be the exceptions.

    13. 21


      When I first saw your link above to the Netflix contest, I checked it out. Interesting problem. Both technically and legally.

      I would venture to say that many provisional applications have already been filed by those hoping to capitalize on this contest. There is a reason many inventors work in secrecy, and it is not just paranoia.

    14. 20

      To Tom

      Given that you are a software patent attorney, you could usefully go over to the Netflix prize forum where some of the posters are worrying about running afoul of existing patents. Giving a little free generic advice now might be a good marketing opportunity for you (or any other patent attorneys reading this message). Whoever wins that contest is going to need the services of a good software patent attorney and the solution could be worth some serious money beyond the million dollar prize. There are thousands of active software developers from all over the world working on the contest and all the inevitable losers could be an even better source of work in the future than the eventual winner.

    15. 19

      What I find most interesting is the irony of, the holder of the one-click patent, filing a brief that includes the argument that software and mathematical algorithms are non-patentable subject matter.

    16. 18

      Predictions are the musings of fools, and I feel in a foolish mood. In all likelihood Judge Rader’s view will untimately prevail.

      For me the much more interesting question is what will happen next. Will AT&T and its contemporaries beat feet to Capitol Hill to try and enact a change to Section 271(f), and if it succeeds in doing so will such an exercise of legislative power be upheld as constitutionally permissible?

    17. 17

      Joe Smith said:

      “I think the problem is that lawyers and judges don’t understand software.”

      I agree. It is a rare judge that has any understanding of technology. And, I have met my share of patent attorneys that really do not have a good understanding of technology. But, that doesn’t excuse the critics of patents who do not understand what they are talking about. To have a meaningful discussion, both sides must have a good understanding of the issues, both technology related and law related.

      The PTO has gotten much better about not allowing software patents that are too broad, which was a BIG problem in the early years of software patents. The process is still not perfect, but that is true for all technologies at the PTO.

      I wonder how much of the software patent criticism is because there are so many people affected by software, which makes it good fodder for the media. Not many people care that a patent for digging a hole in the ground restricts others who want to dig a hole in the ground.

    18. 16

      I am not defending the ‘308 patent. But, I do hope to enlighten some who get concerned about the proliferation of software patents.

      Claim 1 of the ‘308 patent is not solely a simple tree search algorithm. Almost every invention is a combination of known things. In this case, a method of searching is combined with many other elements and limitations, including requiring registered user information stored in a database, data on direct connections to those registered users, and connecting located registered users. The claim does not prevent anyone from using a similar algorithm for a different application. The claim solved the problem of, simply stated, how to broaden a social network maintained on a computer system. The solution was the linking of the degrees of separation, but the solution requires some very specific things to do this. That is all this particular patent protects.

      Patents do not protect algorithms. But, patents can protect a real-world application of an algorithm. There is no requirement for an inventor to prove that the invention promotes progress. As for putting up hurdles, that is the nature of patents. It applies to all technologies, not just software.

      Being a software patent attorney is no different than being a patent attorney for other technologies. It requires a good understanding of the technology, patent law, and lots of practice. As a computer geek I spend a lot of time reading about computers and keeping up with the latest technologies. As a patent attorney, I do the same thing with the law, but I spend more time reading cases, attending seminars, and studying about patent law than I ever did with computers.

      Years ago, when I worked as an engineer, I wrote shareware (even sold some copies!). sw engr, if you want more information about me and becoming a software patent attorney, feel free to write me directly.

    19. 15

      Tom said “I think the reason for the difference of opinion between legal types and software types is that a lot of non-legal types do not understand what software patents protect.”

      I think the problem is that lawyers and judges don’t understand software. You can point to the fact that Amazon’s one click patent got a hard time in the courts and I’ll point to the fact that it got issued in the first place and that Barnes and Noble had to spend a lot of money defending themselves. One click is hardly the only example. “Buy-it now” and the Forgent claims against jpeg are other examples. One experienced software venture capitalist has said that in software now you cannot “tie your shoe laces” without infringing someone’s patent.

      I fear that we are sliding off topic. This thread should be about extra territorial operation of American patent laws and only collaterally relates to the appropriateness of software patents within the US.

    20. 14

      “I reviewed patent 7,069,308 cited by softwarevisualization. One reason many patent attorneys disagree that software patents are a problem is because they look at the claims and ignore the general media interpretation of what the patent protects. The claims here are method claims directed to a narrow application of social networking.”

      Tom, for the benefit of us non-legals, could you elaborate on what aspects of the patent claim you find to be “narrow”? I read the first claim and it appears to be a simple tree search algorithm. Can you get a patent by applying algorithms to something like social networking? Don’t you have to prove that it promotes progress or something? As a software engineer, I have to agree with swvisualization that a lot of these software patents aren’t deserving. I just don’t see how they are promoting progress except putting up hurdles for us sw developers. A lot of old timers here said sw development before sw patents were less constrained: during the early dot com era, people were slinging out products with unrestricted freedom of ideas. Now, sw development requires more legal considerations than ever, and it seems for insignificant stuff associated with these so called innovations.

      Could you comment on your background — I am interested in qualifications of becoming a software patent attorney.

    21. 12

      Your update is terribly important for me as an IPR attorney and legal practitioner in Asia, in particular, in Hong Kong SAR, China to keep pace of the development of law in the USA.
      Please keep me informed of any seminar/ conference in this respect so that I am able to join and participate.

      Yours faithfully,

      William Leung
      William K.W. Leung & Co., Solicitors of Hong Kong SAR, China.

    22. 11

      I think the reason for the difference of opinion between legal types and software types is that a lot of non-legal types do not understand what software patents protect. A lot of people point to Amazon’s One-Click patent as an example of a software patent, but Amazon got slapped around by the court pretty good on that patent. Amazon dropped (settled) the case shortly after the Federal Circuit opinion, so patent validity was not adjudicated. Barnes & Noble had some pretty good prior art for invalidating that patent.

      Those against software patents seem to feel singled out by the patent system. I hear them say that all the good software is already patented and they cannot program anything without violating a patent. Well, I have many clients that feel the same about non-software products. It is not unusual for a non-software client to be stopped in his tracks because a product he wants to make or sell is already patented. Welcome to the world of patent protection. If you are the first to invent something that is new, useful, and non-obvious, you can get a limited monopoly known as a patent.

      Many of the software patent applications I draft are also disclosed as being able to be implemented through hardware circuitry although the software version is preferred. No one questions that hardware inventions can be patented. If an inventor can implement an invention either through software or hardware, should he be able to get a patent only for the hardware implementation but not the software implementation?

      My point is, it is not software that is protected by patents, but what the software does, its utility. The utility of software is not a matter of expression and has nothing to do with speech as softwarevisualization asserts. When I draft a software patent, I claim a program that does a series of steps or functions. This is not really any different than any other claim for a non-software patent I draft. If those steps or functions are new, useful, and non-obvious, why shouldn’t a patent issue?

      I reviewed patent 7,069,308 cited by softwarevisualization. One reason many patent attorneys disagree that software patents are a problem is because they look at the claims and ignore the general media interpretation of what the patent protects. The claims here are method claims directed to a narrow application of social networking. I fail to see why software people would feel threatened by such a patent unless their business is directly threatened by such a patent. But, then, how would that be different than any other patent out there, software or not?

    23. 10


      your post is spot on! but you should prepare yourself for a torrent of software-deserves-patent-protection-too responses. in any case, i’m also at a loss to understand how things got to this point and why there aren’t more people versed in law and technology that don’t feel the same way. i’m not cynical enough to believe that the patent software camp is purely in it for the $.

    24. 9

      Software patents are a problem. Over at Netflix the company is offering a million dollar prize for a better recommender system but the solution has to not infringe on any patents to qualify for the prize. Given the way that software patents tend to be written, and the litigiousness of the patent holding firms, some of the participants are concluding that any victory will be a hollow one dooming the winner to spend the money, if he ever receives it, on legal fees.
      link to

      How do patents in this case promote progress?

    25. 8

      If Microsoft loses, we’ll all be treated to the spectacle of watching future Supremes attempt to count the number of angels which can fit on the head of a pin. Consider:

      A foreign student living in the US who in the course of her studies has an assignment which naturally leads her to “experiment with, recreate, modify, improve or merely use”, a patented algorithm, which is to say virtually any cutting edge algorithm of any worth. Her creation is not infringing since it’s not a product, but what happens when she and her code, or her ability to recreate that code, is “transmitted” back to her country of origin, say Belgium? The student is radioactive. She is forbidden from using her code as a component in the US, of course, but also, she can’t hope to use it overseas either without her employer being sued. She now bears with her, forever and always, stolen fruit. The means of transmission here is herself and Air France. Can she deny she completed her assignment in the US? What was she to do, refuse any work that would bring her tangent to patented algorithms? No matter how you twist and turn, I can paint a case which will simultaneously lead to infringement and a deeply dysfunctional and anti-social state of affairs. Let’s say her education was revealed to have been sponsored by her employer, who then benefited from her knowledge. I think we can all see where this goes.

      The real problem is the existence of software patents, and not just “junk” software patents, but software patents at all. Software is “this” close to speech in it’s fluidity, ease of conception and creation, derivativeness, dependence and implicitness on and in a shared context. You cannot apportion and mete out, idea by idea, every thought people have had or are going to have just because they are expressed in software. That’s the difference between software and hardware- software is a language used to express ideas. The ease, naturalness, spontaneity and universality of writing code makes it absolutely and completely different from inventing a new light bulb, or a new ABS braking system or a new cancer treatment.

      Somehow, in the flood of money that surrounds all the actors involved in software patent licensing and litigation, the purpose of issuing a patent as specified in the Constitution gets lost. That purpose is, roughly, to induce the creative genius to reveal to the world at large, through enticement of temporary monopoly, the astonishing intellectual feat through which he achieved
      some ends, which means he would otherwise be inclined to secret away. The purpose is to promote the useful arts and sciences.

      How far away are we from that when we have near universal, spontaneous and unconscious infringement of Amazon’s “one click” and Friendster’s “system, method, and apparatus for connecting users in an online computer system based on their relationships within social networks”. link to

      This kind of thing is a joke to software developers. It’s nothing more than a prize given to the first idiot to rush ordinary ideas or ideas that are implicit to anyone familiar with technology and inclined to think substantively about it, to the patent office to grab their prize. It has absolutely nothing to do with the good of society. With respect to software patents, the USPTO is a profit-center /lottery, funded by hopefuls, dispensing nothing of value to society and spreading quite a bit of nonsense and harmful roadblocks to progress. It’s time for all involved to sober up.

      What bothers me most is the near total absence from patent attorneys of principled voices on this subject. How is it that nearly all software developers, PHOSITAS all, can be on one side of this issue, and those versed in the constitution and the essence of civil society all be on the other? It may have something to do with money, but that’s just a wild guess on my part. Perhaps we’ll see some real disinterested and objective opinion and yes, courage, come down from from the Supremes this year.

    26. 7

      The United States was founded and built by people who had voted with their feet. With that collective cultural background it is no wonder that American software companies are voting with their feet and moving software development offshore.

    27. 6

      Although admittedly not its major holding, the NTP v. RIM does discuss 271(f), and holds that RIM’s supply of Blackberry devices does not constitute supply of a “component” of the claimed method.

      From the Opinion: ‘While it is difficult to conceive of how one might supply or cause to be supplied all or a substantial portion of the steps of a patented method in the sense contemplated by the phrase “components of a patented invention” in section 271(f), it is clear that RIM’s supply of the BlackBerry handheld devices and Redirector products to its customers in the United States is not the statutory “supply” of any “component” steps for combination into NTP’s patented methods.’

    28. 5

      NTP v. RIM does not address “component” in 271(f), but rather the term “use” in 271(a). In NTP, the CAFC held that a method claim can only infringe under 271(a), if all steps are performed in the U.S.

    29. 4

      In biotech, the marketed product is typically a protein that does not contain the DNA as a “component”, and therefore claims to the protein aren’t infringed by exporting the DNA. As for the recombinant protein-producing cells themselves, the DNA in the cells is replicated from DNA originally supplied in a viral or plasmid vector. No molecule of an exported vector’s DNA becomes part of the organism’s DNA.

      DNA is very much like software, in that one can copy and easily export the “instructions” that are at the heart of the invention. The viral vector is the biotech equivalent of a floppy disk or CD. Both of these are patentable, but in both cases the instruction set can be exported electronically without infringing the claims. (Reconstructing a full-length DNA is well within today’s technology … the polio virus genome, about 5.4 kb, was assembled from scratch in 2002.) A foreign-built organism containing US-patented DNA is entirely analogous to a foreign-built computer loaded with US-patented software.

      I think it boils down to whether a set of instructions, in the abstract, is patentable subject matter. That question, it seems to me, is for Congress to answer. Given the time, creativity, money and labor invested in programming — and in making transgenic host cells — making instruction sets eligible for some form of IP protection seems entirely reasonable. The real problem is that the patent statutes are not well-suited to the task.

      A separate observation:
      Why should Microsoft come out in favor of weakening US software patents — wouldn’t others do unto Microsoft as Microsoft does unto them? It’s because Microsoft can afford patents in 101 countries around the world, while the smaller companies cannot, leaving Microsoft free to pillage and plunder at will. It’s unsavory and typically ruthless Microsoft behavior, but the lack of foreign patent protection is a fact of life for small companies in every industry. Foreign companies copying US inventions for foreign markets is something we find acceptable, but we might ask ourselves if US companies should be permitted to do it.

    30. 3

      “molecular conservation requirement”

      Interesting concept. Ignoring the niceties of law, I have yet to install any software on any computer hard drive where the contents of the disk magically transform into something that becomes a part of a computer’s molecular structure….

    31. 2

      Sending “genes” would be tough. Sending a list of the DNA sequences that encode a protein is certainly easy – just cut and paste into an email. But actually reassembling on the other end into a single piece of workable DNA is non-trivial, especially for DNAs that encode biologically active proteins. Those tend to big and beyond the capacity of today’s DNA-synthesizing machines.

      It’s not that’s impossible, but just not directly analogous to the software case. With software, once you have the correct source code and a compiler, you just press and there it goes. The DNA situation is not directly analogous given the technical limitations.

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