Published 21/02/2017 by Marin Cionca
Since June 2014 when the Alice case was decided by the US Supreme Court, which held that certain software is just an “abstract idea” and thus not patentable, software patents faced an uphill battle when comes to procurement or enforcement. However, during the following years, the Federal Circuit Court decided several software patent cases that provide more clarity regarding the scope of the Alice case and arguably more hope for software patents. Such cases include Enfish and Bascom which we discussed here on our blog in separate articles. A new decision, also favorable to the software patents was issued by the United States Court of Appeals for the Federal Circuit (Federal Circuit) on January 18, 2017 in TRADING TECHNOLOGIES INTERNATIONAL, INC., v.CQG LLC. Although this decision is non-precedential, it addresses a specific aspect of software, namely the graphical user interface (GUI), and an example of what can make a GUI patentable. For that reason, the discussion of this case is warranted.
Summary of The Case
Trading Technologies asserted against Cog U.S. Patents No. 6,772,132 (“the ’132 patent”) and No. 6,766,304 (“the ’304 patent”), which “describe and claim a method and system for the electronic trading of stocks, bonds, futures, options and similar products. The patents explain problems that arise when a trader attempts to enter an order at a particular price, but misses the price because the market moved before the order was entered and executed. It also sometimes occurred that trades were executed at different prices than intended, due to rapid market movement. This is the problem to which these patents are directed.” The patents describe a solution including a trading system in which a graphical user interface “display[s] the market depth of a commodity traded in a market, including a dynamic display for a plurality of bids and for a plurality of asks in the market for the commodity and a static display of prices corresponding to the plurality of bids and asks.” The court agreed with the district court which held that the claims are not directed to an abstract idea and also that they recite an inventive concept, such that the subject matter is patent-eligible under 35 U.S.C. § 101 (i.e., is not an abstract idea).
At district level, the court first applied Step 1 of the two-step analysis under Alice. The Federal Circuit court agreed with the district court that, rather than reciting “a mathematical algorithm,” “a fundamental economic or longstanding commercial practice,” or “a challenge in business,” the challenged patents “solve problems of prior graphical user interface devices...in the context of computerized trading relating to speed, accuracy and usability.” The district court further held, and the Federal Circuit court agreed, that these patents are directed to improvements in existing graphical user interface devices that have no “pre-electronic trading analog,” and recite more than “‘setting, displaying, and selecting’ data or information that is visible on the [graphical user interface] device.”
The district court alternatively continued the analysis under Alice Step 2, and it concluded that the specific structure and concordant functionality of the graphical user interface provides the inventive concept that makes the invention more than an abstract idea.
This case is another good news for software patents. One lesson learned here is that software inventions have to be looked at carefully, module by module, aspect by aspect, including the general user interface. An identified technological improvement in any of the modules may be enough to escape an Alice-abstract idea challenge from a patent examiner at USPTO or an infringer of the patent in patent litigation.
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