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This column was published in a copyrighted issue of
Communications of the ACM (vol. 33, issue 8, Aug. 1990).
Noncommercial copying of this article is permitted.


 Legally Speaking:  Should Program Algorithms Be Patented?
                             by

                      Pamela Samuelson


     In the May 1990 Legally Speaking column,[1] the author
reported on a survey she and Robert Glushko conducted at
last year's ACM-sponsored Conference on Computer-Human
Interaction in Austin, Texas.  Among the issues about which
the survey inquired was whether the respondents thought that
patent protection should be available for various aspects of
computer programs.  The 667 respondents overwhelmingly
supported copyright protection for source and object code
although they strongly opposed copyright or patent
protection for "look and feel" and most other aspects of
programs.  Algorithms were the only aspect of programs for
which there was more than a small minority of support for
patent protection.  Even so, more than half of the
respondents opposed either copyright or patent protection
for algorithms.  However, nearly forty per cent of the
respondents regarded algorithms as appropriately protected
by patents.  (Another eight per cent would have copyright
law protect them.)

     It should not be surprising that these survey findings
reflect division within the technical community about
patents as a form of protection for this important kind of
computer program innovation, for a number of prominent
computer professionals who have written or spoken about
patent protection for algorithms or other innovative aspects
of programs have either opposed or expressed reservations
about this form of protection for software
innovations.[2,3,4]

     That, of course, has not stopped many firms and some
individuals from seeking patent protection for algorithms or
other software innovations.[5]  Although the Refac
Technology patent infringement lawsuit against Lotus and
other spreadsheet producers may be in some jeopardy, it and
other software patent lawsuits have increased awareness of
the new availability of software patents.  This, in turn,
has generated some heated discussion over whether this form
of legal protection will be in the industry's (and
society's) long-term best interest.

     The aim of this column is to acquaint my readers with
the legal debate on patent protection for algorithms and
other computer program innovations which seems to be no less
divisive among lawyers.[6,7]

THE LEGAL DEBATE

     There are three U.S. Supreme Court decisions that seem
quite plainly to say that computer program algorithms are
not the sort of innovation that can be patented.  (More
precisely, program algorithms have been said not to be the
kind of "processes" that Congress intended to be eligible
for patent protection when they passed the patent statute.)
But as Eccelesiastes once said, "God made mankind straight,
but men have had recourse to many subtleties."  Patent
lawyers have found ways of interpreting these three
decisions more narrowly than their plain meaning might have
suggested was appropriate, and through clever drafting of
patent applications have persuaded the patent office that
these decisions don't bar patents for their clients'
software innovations.

     Some patent lawyers, for example, have interpreted the
third of these three Supreme Court decisions as meaning that
algorithms are now unpatentable only if no practical
application is claimed for them.[6]  This reading of the
judicial opinion ignores too much of the rest of what the
Court said in that case to be a convincing interpretation.
It also runs counter to a set of guidelines that the Patent
& Trademark Office (PTO) issued within the past year
concerning the standards by which it would judge patent
claims for algorithms.[8]  Nevertheless, some recently
issued patents suggest that at least some patent examiners
are operating on this basis.  A lawyer who takes an
aggressive stand on the patentability of software
innovations is certainly more likely to generate more
business for him- or herself than one who has a more
cautious interpretation of the patentability standard.

     While lawyers have been arguing for many years about
the patenting of software innovations, the legal debate over
the patenting of algorithms heated up when in 1986 Donald
Chisum, an articulate and well-respected patent scholar,
wrote an article arguing that the Supreme Court rulings
against patent protection for computer program algorithms be
overruled.  He asserted that the rulings were wrong as a
matter of patent law as well as being bad intellectual
property policy.[9]  Since then, the PTO has issued some
well-publicized patents for computer program algorithms,
including one for industrial applications of Narendra
Karmarkar's linear programming algorithm, assigned to AT&T.
And this past November an appellate court overturned a
decision by the PTO which would have denied a patent to a
voice recognition algorithm.  (The implications of this
case, however, are far from clear, however, for the decision
said it was following the earlier Supreme Court rulings, and
upheld the algorithm patent claim on grounds that are far
from convincing and seem at odds with at least one of the
previous Supreme Court decisions (see below).)  And so the
legal debate goes on.

     While this column can only give a brief glimpse of the
history of the legal debate on this topic,[10] it is well to
begin with the story of the first computer program algorithm
case to be decided by the Supreme Court for it is typical of
the problems that computer program innovations present for
the patent system, and it is the case which Professor Chisum
has argued should be overruled.  The article will then
discuss the two most recent appellate decisions on the
patentability of algorithms.

THE BENSON CASE

     Gottschalk v. Benson is the 1972 Supreme Court decision
that ruled that a computer program algorithm was
unpatentable in nature.  Gottschalk was the Commissioner of
Patents who sought Supreme Court review of an appellate
court ruling which had overturned the patent office's
decision to deny Benson (an employee of Bell Laboratories) a
patent on his two claims for a new algorithm for converting
binary coded decimals to pure binary form.

     The appellate court regarded the first two of Benson's
claims as easily meeting the standards for a patentable
process because the claim made reference to hardware
elements, such as "signals" and "reentrant shift registers."
This meant, said the judges, that it was only a claim for
the machine implementation of this process.  Under standards
this court had announced in previous cases, such hardware
references made the claim a patentable one.  The judges
pointed out that cash registers, like Benson's method,
worked with numbers, but that didn't make such registers
unpatentable.  (This analogy, however, misses the deeper
question of whether addition itself would be patentable as a
process merely because it is capable of being carried out on
a machine such as a cash register, of which more below.)

     Benson's second claim, however, made no mention of any
hardware elements.  The appellate court admitted that
issuing a patent on this claim would cover the method when
performed manually with a pencil and paper (which was why
the patent office regarded it as an unpatentable "mental
process").  Because it regarded computer implementations to
be the only practical utilization of the invention, the
court decided that this claim too was technological enough
in character to be a patentable process.  Consequently, the
appellate court ruled that the patent office had been wrong
to reject Benson's patent application.

     The Supreme Court reversed this appellate court
decision and ruled that the patent office had been right to
reject both of Benson's claims.  It agreed with the patent
office that up till that time, only processes that involved
the transformation of matter from one physical state to
another (such as a chemical process might) had been
considered patentable.  Benson's method did not transform
matter.

     While the Court made clear that it wasn't saying that
transformation of matter would always be required to support
the patentability of a process, the judges were persuaded by
"friend of the court" briefs submitted by such firms as IBM,
Burroughs, and Honeywell that because of the mathematical
character of the Benson algorithm, it was not the sort of
process that was patentable in nature.  (The Court also
agreed with the patent office that mental processes are not
patentable, although this was not one of its main points.)
The Court likened Benson's algorithm to a law of nature or a
scientific principle, which are kinds of discoveries
traditionally not considered to be patentable in character.
That the only practical utilization of the Benson algorithm
was in a computer was taken by the Court to mean that a
patent on it would, in effect, preempt all uses of that
algorithm.  That too influenced the Court to deny its
patentability.

POST-BENSON PATENTABILITY STANDARDS

     In the years that followed the Supreme Court's 1972
Benson decision, the appellate court reviewed a number of
other patent office decisions involving computer program
innovations.  In these cases, the court experimented with
various interpretations of the Benson decision (which the
appellate court was bound to follow, even if the judges on
it didn't agree with the Supreme Court's ruling).

     For a while, the appellate court interpreted Benson as
applying only to claims drafted in "process" (or method)
form, and not to claims drafted in "machine" (or apparatus)
form, although a patent lawyer could, through minor wording
changes, easily draft the claims in either form.  At some
point, however, the appellate court decided to abandon this
distinction.  (But see the discussion of the Iwahashi case
below.)

     Then the appellate court began to distinguish between
"mathematical algorithms" (by which the appellate court
generally meant mathematical formulae) which it said were
unpatentable under the Benson ruling and nonmathematical
algorithms (such as an algorithm for converting written
texts from one natural language to another which the
appellate court regarded as nonmathematical in character)
which could be patented.

     For a time, the appellate court decided that even
claims for "mathematical algorithms" might still be
patentable so long as the claims did not cover all uses of
the algorithm, so that limiting the claim to some
technological environment or field of application were
regarded by the appellate court as "saving" the claims from
Benson's proscription against a patent on an algorithm.

     However, in 1978 (and again in 1981), the Supreme Court
said that claim limitations of this sort were not consistent
with its ruling in Benson.  Nor was it consistent with
Benson merely to "tack on" to the claims some minor "post-
solution" activity.  In its 1981 decision Diamond v. Diehr,
the Supreme Court ruled that a patent claim for a process
should not be rejected merely because it included a
mathematical calculation or a computer program as an
element.

     All that was required, the Court said, was that the
process being claimed--in Diehr, the process was said to be
one for curing rubber, which included as an element some
computerized calculations to determine when the curing was
done--be of a patentable sort.  Rubber curing being a
traditional sort of industrial process (i.e, one involving
the transformation of matter), the Court found Diehr's
process to be patentable in nature.  The present PTO
guidelines on the patentability of claims involving
"mathematical algorithms" attempt to implement the Supreme
Court's ruling in Diehr, as well as to be consistent with
other appellate court's rulings on computer program-related
inventions.

THE IWAHASHI CASE

     There have been relatively few court decisions since
the Supreme Court's Diehr decision concerning the
patentability of computer program algorithms or other
software innovations.  In the fall of 1989, however, the
appellate court which oversees the patent office's decisions
issued two opinions concerning what the PTO found to be
unpatentable algorithms .  In the Iwahashi case, the
appellate court ruled that a patent should have issued; in
the Grams case, the appellate court upheld the PTO's
rejection of the claims.

     Iwahashi's claim was drafted in apparatus (rather than
method) form, and was for an auto-correlation unit useful in
pattern recognition (particularly voice recognition) to
obtain auto-correlation coefficients for stored signal
samples.  Iwahashi claimed to have invented a simpler way to
obtain the desired coefficients.  (Rather than utilizing
multiplication as the prior art did, which required more
complicated circuitry and more calculation time, Iwahashi's
unit squared the sum of two factors in accordance with a
stated formula.)

     Most of the elements in the claim were for obtaining
input values, calculating sums in accordance with a formula,
and storing the values obtained from the calculations.
Several of the claim elements made reference to "read only
memory" (e.g., storing a value in read only memory).
Despite these references, the PTO regarded the claim
nonetheless as being for the algorithm.  The appellate
court, however, focused on the fact that the claim was for
an apparatus (a "unit"), and made references to "read only
memory" (a hardware component) in ruling that the claim was
for a patentable machine.

     Given that the Supreme Court, in the course of judging
the patentability of Benson's invention, did not distinguish
between the claim which referred to "reentrant shift
registers" and that which made no reference to any hardware
elements, the appellate court's ruling in Iwahashi seems
inconsistent with Benson.  One wonders from reading this
case whether all it takes now to render a claim for a
computer program-related innovation patentable is to draft
it in apparatus form and mention a ROM.

     The Iwahashi opinion is also difficult to square with
earlier decisions by a predecessor appellate court, which
regarded it immaterial whether a claim reciting a
mathematical algorithm was drafted in method or apparatus
form.  Although the decision does not indicate whether the
algorithm was intended to be embodied in a program or in a
chip, this distinction too would not seem to be meaningful
since the Benson algorithm, like all other computer program
algorithms, too could have been embodied in a chip, rather
than a program.
     (Another computer program algorithm patent which it
seems difficult to square with the three Supreme Court
decisions on this subject is AT&T's patent on the Karmarkar
algorithm, or at least on "industrial applications" of it,
in view of the Court's statements that merely limiting the
field of application for the algorithm does not make it
patentable.)
THE GRAMS CASE
     Grams made a number of claims related to a method of
diagosing abnormal conditions in complex systems.  The
method consisted of steps such as conducting tests on
individual instances of the system, taking values from these
tests and comparing them with values associated with normal
individuals, and conducting successive tests to determine
the cause(s) of the abnormality.  The patent application
made evident that the method was to be "computerized."
Relying on the 1982 Meyer decision in which an algorithm for
an expert system program for diagnosis of neurological
conditions had been held to be unpatentable as being for a
mathematical algorithm, the appellate court in Grams upheld
the PTO's rejection of the claims.
     One of the things that was surprising about both the
Grams and the Meyer decisions was that in them the court
took a broader view of what the term "mathematical
algorithm" included than it had in some of its earlier
decisions.  In the 1978 Toma case, for example, the
appellate court had rejected the argument that Toma's
algorithm for a computerized process of natural language
translation was a "mathematical algorithm" for it recited no
equation; but then neither did Grams' or Meyer's
applications.  In the latter two cases, the appellate court
also emphasized that the claims were for an unpatentable
mental process, even though it was clear that the intended
implementation of both was a computer program.

WHAT TO DO IF PATENT LAW'S DISTINCTIONS ARE UNTENABLE

     Professor Chisum has argued that the Supreme Court's
Benson decision should be overruled.  Benson's algorithm
was, in his view, a process that was technological enough in
character to be patentable.  Chisum has blamed the analytic
confusion reflected in the judicial case law (such as the
distinction between "mathematical" and "nonmathematical"
algorithms) on the Supreme Court's Benson decision, and
predicts that all will be well once Benson is overruled.
Chisum has also asserted that patent incentives are needed
to stimulate investment in research that will lead to
important algorithmic innovations and advance the state of
the art of computer programming.

     The computer scientist Allen Newell, in responding to
Chisum's article the patentability of algorithms, agreed
with Chisum that the distinction between mathematical and
nonmathematical algorithms is untenable, as is that between
algorithms and mental processes.  Newell pointed out that
cognitive scientists have been aiming to model the
computational processes which occur in the brain by writing
programs that simulate this kind of computation;
consequently, there is an equivalence between algorithms and
mental processes that makes any distinction between them for
patent purposes doomed to failure.

     While agreeing with Chisum that the particular
confusion that developed in the law in the aftermath of the
Benson decision might disappear if Benson was overruled, he
questioned Chisum's conclusion that all the analytic
confusion in patent law concerning algorithms would be
resolved by this act.  Newell thought more profound issues
were raised by the patenting of program algorithms than
Chisum seemed to realize.

     Newell suggested that the conceptual models on which
the patent system was based might be broken when applied to
algorithms and other program innovations, and questioned
whether more innovation in program algorithms would result
from patenting than has resulted from what has been the norm
of nonprotection.

     Newell used the example of the commonly used algorithm
for addition to illustrate the conceptual problems presented
by patents for algorithms.  Suppose it (or some other
mathematical procedure of equally widespread application)
had just been invented.  Chisum's definition of a patentable
process would seem to include such an innovation as a
patentable one.  And yet it is surely the kind of innovation
which would ordinarily not be considered patentable.  (Even
the Supreme Court justices who would have upheld a patent on
an equation useful in catalytic conversion plants in the
1978 Parker v. Flook case gave multiplication as an example
of an unpatentable process.)

THE NEED FOR A STANDARD OF PATENTABILITY

     Before overruling the Benson decision, it is surely
wise to think carefully about the consequences of granting
patent protection to computer program algorithms, which are
by nature mathematical in character.  What makes them
"technogical" enough to be patentable processes?  The fact
that they can be carried out on computer?  Some case law
suggests this may be enough.

     If that is so, an algorithm for addition would seem to
be patentable, as would the program which would carry it
out.  Since a patent could issue on the algorithm itself,
and since patent law gives the holder of the patent
exclusive rights to use the patented invention, some might
even argue that it would infringe the patent to write an
article about the algorithm, for writing about it would
"use" it, and would induce one's readers to "use" it as
well, which might be regarded as contributory infringement.
(For that matter, even reading the patent might be an
infringing use of it.)  It has traditionally not infringed a
patent to draw a patented machine or to write an article
about it, for one could not thereby "make" or "use" the
machine, whereas with mental processes like addition, one
can "use" the invention by writing about it.

     Given that all manner of information can now be
processed by computer, a standard of patentability that
rested merely on the ability to computerize it would make
all methods of representing, organizing, and manipulating
information patentable.  (Benson's algorithm, for example,
can be characterized as a method of representing data--in
that case, numerical information--or converting its
representation from one form to another.)  In the past,
methods of representing, organizing, and manipulating
information have been considered unpatentable, as not being
"technological" in character.  It seems a rather broad
stretch to make all information processing patentable just
because one wants, for example, to give AT&T incentives to
invest in research for advances in computing such as the
Karmarkar linear programming algorithm.  Yet where does one
draw the line?

     Chisum punts when it comes to indicating what the
bounds of patentability would be if Benson was overruled,
looking only to a 1970 case which says that all it takes to
be a patentable process is for the process to be "in the
technological arts," without defining what that might and
might not include.  Later cases interpreting that 1970 case
seem to say that it is enough to make a process patentable
that it can be carried out on a computer.  Transformation of
matter as a test of what patentable processes might include
and not include may have outlived its usefulness, but at
least it was a standard that provided some limiting
boundaries for patentability.

     Furthermore, given how much the software industry has
grown and how much innovation it has exhibited in an
environment in which patent protection was perceived to be
unavailable, some have questioned whether more than
copyright or trade secret protection is really needed to
incent innovations in computer programming.

     Some also express concern about the ability of the PTO
to make up for thirty years of not keeping track of the
state of the art of computer programming, and the adequacy
of its classification system, as well as its judgment as to
the "nonobviousness" of some innovations which have been
patented.  In addition, some worry that the structure of the
software industry will be changed by the increasing
utilization of patents for software innovations, and entry
into the business made more difficult.  Given how much
innovation in the field has come from small firms, the
prospect of higher entry barriers from patents is worth
considering carefully.

A NEW POLICY STUDY IS UNDERWAY

     At the request of some Congressional committees, the
Office of Technology Assessment of the U.S. Congress has
just recently undertaken to study how the U.S. software
industry can most effectively utilize intellectual property
protection to maintain its competitive edge in the emerging
global marketplace for software.  Among the issues OTA will
be studying is what role patents should play in the legal
protection of program innovations.  OTA will be seeking
input from computing professionals, industry people, user
groups, as well as lawyers, in carrying out this work.  OTA
may well conclude that although it might have impeded the
growth of the industry if patents had been available for
program innovations in the early stages of the software
industry, such protection is now needed to spur investment
in software development and strengthen the position of U.S.
firms in the international arena.  Let me know what you
think.


REFERENCES

[1]  Samuelson, P. and Glushko, R.  Survey on the Look and
Feel Lawsuits, Commun. of the ACM 33, 483 (May 1990).

[2]  Newell, A.  The Models Are Broken!  The Models Are
Broken.  University of Pittsburgh Law Review, 47, 1023
(1986).

[3]  Kapor, M.  Testimony at Hearings before U.S. House of
Representatives, Subcommittee on Courts, Intellectual
Property and the Administration of Justice, of the Committee
on the Judiciary (March 5, 1990).

[4]  Plauger, P. J.  Soup or Art?  (Copyright Protection for
Software Concepts), Computer Language, 6, 17 (Sept. 1989).

[5]  Soma, J. and Smith, B.  Software Trends:  Who's Getting
How Many of What? 1978 to 1987, J. of Pat. & Tradem. Soc'y,
71, 415 (1989).

[6]  Sumner, J. and S. Lundberg.  The Versatility of
Software Patent Protection:  From Subroutines to Look and
Feel, Computer Lawyer, 3, 1 (June 1986).

[7]  Kahin, B.  The Software Patent Crisis, Technology
Review, 93, 52 (April 1990).

[8]  U.S. Patent & Trademark Office.  Report on Patentable
Subject Matter:  Mathematical Algorithms and Computer
Programs, Pat., Cop., & Tradem. J. (BNA), 38, 563 (1989).

[9]  Chisum, D.  The Patentability of Algorithms.
University of Pittsburgh Law Review, 47, 959  (1986).

[10]  Samuelson, P.  Benson Revisited:  Should Patent
Protection Be Available for Algorithms and Other Computer
Program-Related Inventions?  Emory Law Journal, 39,
(forthcoming fall 1990).

Pamela Samuelson is a Professor of Law at the University of
Pittsburgh School of Law.