The issue of protecting their intangible rights arises for IT companies and entrepreneurs at the very beginning of their work or even before the start of actual operations. After all, almost the entire value of a technology company is the value of its intellectual property. And if a competitor “copies” the development, the author may be left with nothing.
To protect their property, innovative companies must use a set of measures: proper registration of the transfer of rights to software, formation and control of the implementation of provisions on commercial secrecy, use of copyright tools, protection of the user interface, registration of trademarks, and patenting of software.
More about patenting
Software patenting is the most difficult of these tools to implement, but a software patent offers a number of advantages:
- the strongest degree of protection for your intellectual property;
- competitors will not be able to simply modify the code slightly and pass it off as their own development, as is the case with copyright;
- the patent blocks the granting of patents for similar developments;
- the patent itself is a very valuable asset and automatically increases the market value of the company.
However, there are also disadvantages:
- the most difficult registration procedure among the other tools;
- relatively high cost of registering rights and the need to maintain the patent in force;
- the length of the procedure (1.5-3 years).
The procedure for registering a software patent depends on the country. And, like intellectual property itself, legislation is also constantly changing and adapting to modern realities.
It is possible to obtain a software patent in the form of a patent for an invention and a patent for a utility model. A patent for an invention involves a more complex registration procedure: the applicant must prove that their invention is novel, has an inventive step, and is useful (can be applied on an industrial scale).
For a utility model patent, only novelty and industrial applicability are required.
Software patenting in the US
The US is a popular jurisdiction for software patenting. In addition to its huge consumer market and investor interest, the US stands out for its ability to obtain software patents. Neither software nor computer programs are directly mentioned in US patent laws. However, the advantages of the case law system have shaped judicial practice, which determines the criteria for patenting software and those for which it cannot be patented.
The US Patent and Trademark Office (USPTO) only issues patents for inventions (Utility Patents). The patent term is 20 years. The registration procedure takes 1.5-3 years.
A patent is issued for any new and useful process, mechanism, production or composition of matter, or any new and useful improvement. In order for the office not to refuse patent protection on the grounds that the application contains an abstract idea, the patent description must link it to a physical process or the use of a specific device.
Under current US law, the authors of an invention are individuals. Applicants may be individuals or legal entities. Legal entities obtain ownership of an invention on the basis of an employment contract or an agreement to transfer exclusive rights to the invention.
If the applicant is not yet ready to file a full application but wants to record the filing date, the US provides a mechanism for filing a provisional patent application. However, a full application must be filed within 12 months, otherwise the provisional application will be invalidated.
The US is famous for its active “patent trolls” and the close attention of lawyers from other companies. Competition in the field is very high, and any use of someone else’s patent is likely to be noticed immediately.
Interesting court cases
In Diamond v. Diehr, the Supreme Court ruled that abstract mathematical formulas cannot be patented, but their application in a real, practical process can. The case concerned a method for curing synthetic rubber, where the use of a mathematical formula was part of a broader industrial process. This decision established the principle that software innovations must have practical applications in order to be eligible for a patent.
In Alice Corp. v. CLS Bank, a two-step test was introduced to determine patentability. Under this method, the idea is first tested to see if it is abstract, and then whether it is transformed into an invention through specific, inventive elements. In this case, the court found that simply using an abstract idea on a conventional computer was not sufficient to obtain a patent, which significantly changed the approach to software patenting. The decision in this case had an extraordinary impact on the US patent system and had significant economic consequences.
In 2020, the USPTO released a report on adapting to patent examination results following the Alice Corp. v. CLS Bank case. The report assessed the impact of uncertainty in the patent examination process on investment.
Software patenting is a powerful, albeit complex, intellectual property protection tool that can significantly strengthen a technology company’s competitive position. Unlike copyright, which protects only the form of expression of an idea, a patent protects the essence of a technical solution and prevents even modified copying. At the same time, the complexity of the procedure, high cost, and long registration times require a balanced approach and the involvement of specialists who deeply understand both the legal and technical specifics of the application.
The experience of the United States shows that the effectiveness of software patent protection largely depends on proper legal formalization, the validity of technical novelty, and the ability to prove the practical applicability of the development. Therefore, contact us to get everything done correctly and be confident.
a useful model / copyright / innovations / intellectual property / software
