Software Patent History III: The Federal Circuit Decides Arrhythmia Research & Alappat

This is part 3 of a multi-part series exploring the history of software patents in America. To start reading from the beginning please see The History of Software Patents in the United States. For all of our articles in this series please visit History of Software Patents. In this article we discuss Arrhythmia Research & Alappat.


Software Patents III: The CAFC Decides Arrhythmia Research & AlappatFor some time after the Supreme Court decision in Diehr, the Court of Appeals for the Federal Circuit applied what was known as the Freeman-Walter-Abele test to determine whether a computer program is patentable subject matter pursuant to 35 USC 101. The last of these cases, In re Abele, was decided by the Federal Circuit a little more than a  year after the Supreme Court issued its decision in Diehr.

Given that the Supreme Court almost never overrules its own prior decisions, then Justice Rehnquist tried to explain in Diehr that both Gottschalk v. Benson and Parker v. Flook remained good law, despite the fact that the holding in Diehr clearly set patent eligibility for software on a new path different and distinct from the path chosen by the Court in Benson and Flook. Indeed, in a recent interview Judge Richard Linn told me: ” I have great difficulty rationalizing the Supreme Court’s opinions in Flook and Diehr, and in many regards I think those decisions are irreconcilably in conflict.” Judge Linn isn’t the only one to hold that opinion. If only his panel opinion in Alice were the law of the land — but that is another story for another day.

I recently reviewed the tortured history of how the Federal Circuit came to the Freeman-Walter-Abele test. While the test was scrapped by the Federal Circuit in 1994, it is shocking how the Freeman-Walter-Abele test is so reminiscent of the law today. Of course, the worry de jour back then was whether granting software patent claims would effectively wind up protecting a mathematical algorithm, while the worry de jour at the moment is about granting patents to merely abstract ideas. At least back then we knew what a mathematical equation was, what a mathematical algorithm must be, and the fact that an algorithm couldn’t be synonymous with a process because the statute clearly allows for the patenting of processes. Unfortunately, today we have no such limiting principles and not even an attempted definition for the critical term — abstract idea — which means it is a know it when I see it standard that is the very definition of a moving target.

In any event, prior to its demise, the Federal Circuit succinctly stated the Free-Walter-Abele test as follows:

It is first determined whether a mathematical algorithm is recited directly or indirectly in the claim. If so, it is next determined whether the claimed invention as a whole is no more than the algorithm itself; that is, whether the claim is directed to a mathematical algorithm that is not applied to or limited by physical elements or process steps. Such claims are nonstatutory. However, when the mathematical algorithm is applied in one or more steps of an otherwise statutory process claim, or one or more elements of an otherwise statutory apparatus claim, the requirements of section 101 are met.

In historical terms, the next factual inquiry that presented itself was whether a computer implemented method that transformed data into a readable waveform that could be quickly interpreted was patent eligible. Ultimately, it was wrestling with this scenario that led to the end of the Freeman-Walter-Abele test.



Arrhythmia Research Technology, Inc. v. Corazonix Corp. (Federal Circuit, 1992)

In Arrhythmia Research Technology, Inc. v. Corazonix Corp., the invention in question was directed to the analysis of electrocardiographic signals in order to determine certain characteristics of heart function. In essence, the invention was a monitoring device. It had been discovered that 15% to 25% of heart attack victims are at high risk for ventricular tachycardia, which can be treated by the administration of drugs. Unfortunately, the drugs used have undesirable and dangerous side effects, which led the inventor to come up with a monitoring device capable of determining which heart attack victims were at the highest risk for ventricular tachycardia. By using the invention to monitor heart attack victims treatment could be provided to only those most at risk. Certain steps of the invention were described as conducted with the aid of a digital computer, and the patent set forth the mathematical formulae that were used to configure the computer (i.e., software).

The Federal Circuit ultimately determined that the invention defined a combination of interrelated means for performing specified functions. The computer performed operations transforming a particular input signal to a different output signal that could be visually interpreted. The use of mathematical formulae to describe the electronic structure and operation did not make the invention unpatentable subject matter. The Federal Circuit then concluded that the “apparatus claims satisfy the criteria for statutory subject matter. They are directed to a specific apparatus of practical utility and specified application…”

The Arrhythmia case should be the “poster child” for why software should be patent eligible. There is a machine involved that accepts input signals from the heart that is being monitored, but the core of the invention is unquestionably software. These signals are then manipulated using software, which requires the use of mathematical formulae.  The resulting, manipulated information is then displayed in wave form on a monitor and/or recorded on a chart.  The resulting information, whether on a monitor or on a chart, is then interpreted and lives can be saved.  Why would anyone want to prevent such useful, worthwhile and important innovation from receiving patent protection? If we are going to take the Constitutional mandate at all seriously then this is exactly the type of invention that our patent laws should be encouraging, not discouraging out of some irrational fear of software patents.  It seems obvious to me that if the patent system is intended to encourage innovation for the benefit of society then the patent laws should encourage and then reward this very type of invention that saves lives.

The Freeman-Walter-Abele test, which was applied in the Arrhythmia case, did not have much more life after this application.  Decisions using the Freeman-Walter-Abele test simply allowed for the Judge, or panel of Judges, employing the test to logically reach diametrically opposite decisions while intellectually staying true to the required framework.  Thus, the test was clearly flawed.  It is for this same reason that the current formulation of the software patent test will also be doomed to fail.

While seemingly objective, the application of the Freeman-Walter-Abele test was horribly subjective, which led to uncertainty and the inability to predict outcomes, a consistent and familiar theme that runs through the history of software patents.  In a legal system built on adhering to precedent such a reality ultimately was unacceptable and unworkable.  Notwithstanding, given that some aspects of the Bilski decision appear to harken back to the Freeman-Walter-Abele test, we cannot simply ignore its part in the history of software patents, and may well need to become reacquainted with it in much greater detail in years to come; that is if the Alice absolute prohibition is lifted.


In re Alappat

Several years after Arrhythmia the Federal Circuit abandoned the Freeman-Walter-Abele test sitting en banc in In re Alappat. Judge Giles Sutherland Rich, writing for the full Court in Alappat, did not apply the familiar Freeman-Walter-Abele test, rather opting for the mathematical subject matter exception. The Federal Circuit explained:

[T]he proper inquiry in dealing with the so-called mathematical subject matter exception to Section 101 alleged herein is to see whether the claimed subject matter as a whole is a disembodied mathematical concept, whether categorized as a mathematical formula, mathematical equation, mathematical algorithm, or the like, which in essence represents nothing more than a “law of nature,” “natural phenomenon,” or “abstract idea.” If so, Diehr precludes the patenting of that subject matter.

In hindsight the test in Alappat looks like a three-headed monster. In order to determine whether the invention in question, which was a method for creating a smooth waveform display in a digital oscilloscope, was patent eligible the claim is analyzed to see if the mathematical formula, equation or algorithm in question is a law of nature, natural phenomenon or abstract idea. While the Court did find the patent claims to be patent eligible, this is an early indication that it could be possible that an apparatus claim could cover nothing more than an abstract idea. How a machine that actually exists can merely represent an abstract idea, law of nature or natural phenomenon is puzzling to say the least. The machine exists therefore it isn’t imaginary. It converts data into a viewable waveform, which couldn’t happen without human intervention because as it turns out data just doesn’t convert itself in nature to an easy to understand and interpret format.

Also of particular importance from Alappat is the Federal Circuit’s attempt to explain prior U.S. Supreme Court decisions regarding software patents. In this regard the Federal Circuit stated:

[A]t the core of the [Supreme] Court’s analysis in each of these cases lies an attempt by the Court to explain a rather straightforward concept, namely, that certain types of mathematical subject matter, standing alone, represent nothing more than abstract ideas until reduced to some type of practical application, and thus that subject matter is not, in and of itself, entitled to patent protection.

While the Alappat court may well have wished the Supreme Court decisions to be quite so simple, the truth of the matter is that previous Supreme Court decisions were not at all easy to reconcile. In fact, Supreme Court patent ineligibility decisions cannot be reconciled if you try and take all of the decisions into account. The only way to reconcile Supreme Court guidance on this topic is to selectively ignore precedent that has yet to be overruled. That is how those who favor patent eligibility can write a logically consistent decision citing only Supreme Court decisions, and also how those who favor patent ineligibility can similarly write a logically consistent decision citing only Supreme Court decisions.

Truthfully, then and now it has always seemed that the Supreme Court addresses each case on a case-by-case basis, which does not lead to a cohesive and well thought out approach to dealing with software patents specifically, or patents more generally. The Federal Circuit, on the other hand, increasingly fine tuned its analysis and continued to develop an increasingly coherent and consistent way in which to deal with the growing corporate desire to patent software.

Shortly after the full Federal Circuit implicitly eliminated the Freeman-Walter-Abele test in Alappat by not mentioning or applying it, a three-judge panel once again relied on the test in In re Trovato. This controversial decision did not last long. The Federal Circuit, sitting en banc, withdrew the panel decision, lending further support to the death of the Freeman-Walter-Abele test. Unfortunately, as pointed out previously, more recent decisions back to the schizophrenic and unpredictable Freeman-Walter-Abele test, which is the patent law equivalent of Jason from the Friday the 13th franchise. Thus, the Freeman-Walter-Abele test has a history of returning from the dead.

The Federal Circuit’s holding in State Street Bank & Trust Co. v. Signature Financial Group, Inc. further bolstered the belief that the Freeman-Walter-Abele test was a thing of the past, at least up until the Federal Circuit’s decision in Bilski, where the Court tried to fashion a single test that took all the disparate Supreme Court rulings into account.

CLICK HERE to CONTINUE READING… In Part IV we will discuss Judge Rich’s decision in State Street, which opened the doors on business method patents in the United States.


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