fb-pixel Skip to main content

SO-CALLED ‘PATENT TROLLS’ purchase vaguely written patents and then look for companies that may arguably be violating them in order to demand settlements. It’s an abuse of patent laws, and, in a decision last week, the Supreme Court may have begun the process of curbing it. The case of Alice Corp v. CLS Bank centered on a patented piece of software that helps reduce the risk that one party in a transaction will fail to pay what it owes. The court, in a unanimous ruling, found that because the software was just another way to engage in a longstanding business practice, it was “a patent-ineligible abstract idea.” The court’s willingness to reject a patent on such grounds should clear the way for lower courts to stop enforcing similarly nebulous patents that are used to launch dubious lawsuits. Normally, only the largest companies, like CLS bank, which handles trillions of dollars in currency exchanges daily, are willing to fight these cases. Perhaps after this ruling, even smaller firms will be emboldened to do so.