Applying for Software Patents

I receive a lot of inquiries about applying for software patents. Here's my response.

Software patents are hard to get and even harder to enforce.

In general, patents on software are difficult to get, and virtually impossible to then later enforce in court, given a series of Supreme Court cases in the past decade holding "abstract ideas" implemented in software, including for example business methods, are not eligible to be patented. While there have been bills in Congress to overturn those cases and expressly permit software patenting, they go nowhere because big tech companies with substantial lobbying power (Microsoft, Apple, Google, etc) hate software patents (because they're generally always defendants, not plaintiffs, in software patent cases). This anti-software patent bias in the courts has bled over into the Patent Office, which only grants about half (or less) as many patents relating to software as compared to patents in general.

Applying for software patents is still worth it IMHO.

With that said, there's no downside to applying for patents on software implemented inventions other than the cost of doing so, and you don't want the law to change in a way that makes software patents easier to get after you've lost your right to seek patents on your inventions, which is one year after your invention is disclosed to the public or offered for sale or use to the public. There is also a perceived increase in value of a company with patent applications as compared to one without. Thus, signaling to investors and competitors a focus on building an IP moat can make applying for patents worthwhile even though the odds being granted a patent are low.

Don’t lose the “race” to apply.

It’s very important to know that the patent system is what we lawyers call a "race" system, which means if two people come up with the same or similar invention, only one of them can receive a patent on the idea and the patent is given to the one who files a patent application first, not the one who had the idea first. Up until a little over a decade ago the rule was that a patent would go to the first to invent even if they were the second to apply, but that was changed by Congress in 2011.

Thus, if someone else comes up with the same or similar idea as yours and files a patent application before you, they get the patent, you don't, even if they came up with the idea after you (the only exception is if they got the idea from you, because then they didn't "invent" it themselves). Bottom line, time is of the essence in filing patent applications, especially if you've already disclosed or released your idea publicly.

There are two complementary options for applying.

When it comes to filing a patent application in the United States, there are two options. First there's what we call a "provisional" patent application. The filing fee is only $150 and it gives you a year within which to file a "regular" or "utility" patent application that's written by a registered patent attorney like me. A provisional application doesn't have to satisfy any rules, but is never reviewed by an examiner, and never issues as a patent, while a regular application must satisfy all the rules and gets reviewed by an examiner and hopefully granted. The benefit of filing a provisional is that because they don't have to satisfy any rules it can be filed ASAP and the filing date counts as the filing date of a regular application you file within a year based on what’s described in the provisional. That filing date is critical (we literally call it the "critical date") for making sure you don't miss the one year after publication deadline and also so you beat others in the "race" to the patent office. 

Upon being retained, I generally take whatever written materials a client already has describing their invention (decks, GitHub, website, etc) and slam it together to file a provisional ASAP. Then we have a year to work on drafting the regular application, without worrying about someone beating us in the race in the interim. I charge a flat fee for putting together and filing a provisional application along those lines (i.e. no substantive work by me, just putting together the materials and doing the filing) not including the $150 USPTO filing fee.  This is something one can do themselves if they want. I strongly encourage inventors file a provisional as soon as they can regardless.

I also charge a higher flat fee for drafting a regular patent application, which can take a couple months and includes doing a deep prior art search so we know what obstacles the examiner may place in our way, which doesn't include the roughly $800 filing fee charged by the USPTO. My flat fee includes responding to any issues the examiner assigned the application may raise, because the vast majority of patent applications are rejected at least once, if not several times, and often you will want to have an interview with the examiner to discuss your application along the way.

Application process is long and difficult.

I also always make sure clients are aware that the patent application process can take a very long time. An examiner often does not complete an initial review of a regular/utility application for several years and the entire process can sometimes take a decade or more to complete. Also, as I said above, it is very difficult to get a patent application relating to software approved. For example, the examiners that review blockchain and cryptocurrency related applications at the USPTO currently have a rejection rate of about 70% (compared to an overall rejection rate for the Patent Office of only about 30%). Thus, the odds of having a software patent granted are very low.

I do not tell clients this to discourage them from filing applications, as I still believe the benefit of having a patent application on file, including possibly being granted a patent, outweigh the costs generally, but I do want to make sure they understand what to expect as to timing and likelihood of success. The odds are that, despite my efforts, I will not be successful in having a software patent granted and I don’t like clients to be disappointed, which is why I tell them this before they decide to go forward. 

Some patents are worthless even if issued.

Some patents get granted but are so narrow that they have no competitive benefit or moat. As a primarily patent litigator, I find it futile to get a narrow patent issued if that means you can't ever enforce it against anyone because non-infringing alternatives can be adopted that are fully competitive. My job is to analyze a client’s invention, figure out what's the most important competitive aspects of it, and do all I can to get a patent (or patents) granted on those, so the patent(s) are a competitive barrier and provide real value enhancement. Some clients don’t care about ever asserting their patents, so they just want a patent to be granted. In that case, it’s not as important to make sure the scope of the patent provides competitive advantage. These are issues for a client to discuss with their attorney.

Conclusion

I hope this basic overview is helpful for those curious about software patents.