Reactions to the Supreme Court’s CLS Bank v. Alice decision were mixed on both sides of the debate. Everyone seemed to agree that software patents were not dead, but whether the decision would change the software patent landscape was unclear. Just three months later, however, there is good news for retailers. Both the Federal Circuit and district courts across the country are holding many software patents unpatentable based upon Alice. Fourteen decisions have invalidated software patents since July, including three Federal Circuit decisions, and critical district courts, including C.D. California, D. Delaware, M.D. Florida and E.D. Texas. Timothy B. Lee at Vox (previously at the Washington Post) has continued his excellent reporting on software patent issues and looks at the decisions in his most recent article, along with links to each decision.
This is an important trend focused upon the patents most commonly asserted against retailers and the retail supply chain. Anyone that becomes the target of a software patent should take a hard look at whether the asserted patent is susceptible to a Section 101 challenge. This is especially true because district courts are frequently willing to decide Section 101 issues as Fed. R. Civ. P. 12(c) motions on the pleadings at the outset of a case. That also can make a Section 101 challenge viable even where the troll makes a fairly low initial settlement demand. It also should lower the initial demands in many software patent assertion programs, hoping to prevent targets from filing Section 102 motions.