Full text of DOI:10.1109/35.852038

PATENTS AND TELECOMMUNICATIONS
Patenting Propagated Data Signals:
What Hath God Wrought?
Gregory A. Stobbs, Harness, Dickey & Pierce
message has evolved into cyberspace, a place
ABSTRACT
Morse could not have dreamed would exist.
The electromotive force that Morse
unleashed has profoundly changed the legal sys-
tem. What began simply as humans communicat-
ing with other humans has become high-priced
property — intellectual property. As we shall
see, Morse set the art of communicating on a
collision course with patent law. The result:
propagated data signals are today regarded as
patentable property. Patent infringement can
occur in a mouse click.
The U.S. Patent Office is now issuing patents
on propagated data signals that embody comput-
er programs. Result: patent infringement can
now occur in a mouse click. While patents have
always been available for new and useful pro-
cesses, machines, manufactures, and composi-
tions of matter, the extension of patent law to
computer data signals is new. After losing a
series of battles in the courts, the Patent Office
now considers a computer program embodied in
a carrier wave to be a manufacture, and hence
patentable subject matter. This rather surprising
development provides a powerful weapon against
software patent infringement over the Internet;
and it represents a dangerous snare for the
telecommunications industry. Is there anything
beyond the reach of patent law? The Supreme
Court remains steadfast in this: patents cannot
be obtained for abstract ideas, laws of nature,
and natural phenomena.
For many, this is far outside the box that
Thomas Jefferson intended for our patent sys-
tem; for others, it was long overdue. How we got
to the patented data signal has been an interest-
ing series of twists and turns that we will explore
in this article. Much of the story involves the
patentability of computer software, but we shall
begin with Morse.
SAMUEL MORSE LOSES ROUND ONE
It is ironic that Morse chose the Supreme Court
room for his inaugural telegraph demonstration.
Ten years later, the Supreme Court would sit in
that very room and declare Morse’s patent on
this new mode of communication invalid. Morse
was an ambitious man. He applied for a patent
in 1837, seven years before his inaugural demon-
stration. In his patent application, he made
sweeping claims to all use of electromotive
power for communication at a distance. Figure 1
reproduces Morse’s striking claim, which stakes
out broad territory. In patent parlance, the claim
defines the metes and bounds of the patented
property, much as the legal description in a deed
stakes out the boundaries of a parcel of land.
With this claim, Morse could have collected roy-
alties from everyone who used electromagnetic
energy to communicate.
The Patent Office accepted Morse’s claim
and awarded Morse a patent in 1840. However,
when Morse later sought to enforce his patent
against infringers, a bitter struggle ensued that
took Morse back to the floor of the Supreme
Court. Morse’s adversaries said his claim went
too far. The Supreme Court agreed. In the words
of the Court:
INTRODUCTION
On a bright spring morning in Baltimore, 20
years before the flames of civil war would rage
across the land, Alfred Vail screwed down the
knurled brass terminal onto one end of a long
wire that draped out the window and ran off into
the distance. The terminal was part of an elec-
tromechanical contraption designed to transform
electrical impulses into raised dots and dashes
embossed in a long paper tape.
At the other end of that wire, some 35 miles
away, Samuel Morse paced the floor of the
Supreme Court room in the Capitol, eyeing his
pocket watch as a crowd of spectators began to
gather. In one hour, if everything worked as
planned, Morse would take key in hand and
launch the telecommunications industry with the
words: “What hath God wrought?” The date was
May 24, 1844.
More than 150 years have passed since
Morse’s auspicious message traveled down that
wire to be embossed in a paper tape, now yel-
lowed with age. Although the paper tape has
aged, the vehicle that transported Morse’s mes-
sage down that wire has given birth to many
complex forms of communication. Among the
recent offspring are the HTML code and Java
applets that give structure to our Web sites.
Remarkably, what began as a simple four-word
“If this claim can be maintained, it matters
not by what process or machinery the result is
accomplished. For ought that we now know
some future inventor, in the onward march of
science, may discover by means of the electric
IEEE Communications Magazine • July 2000
98
0163-6804/00/$10.00 © 2000 IEEE

or galvanic current, without using any part of
the process or combination set forth in the
plaintiff’s specification. His invention may be
less complicated — less liable to get out of
order — less expensive in construction, and in
its operation. But yet if it is covered by this
patent the inventor could not use it, nor the
public have the benefit of it without the permis-
sion of this patentee” [1].
I do not propose to limit myself to the specific machinery, or parts of
machinery, described in the foregoing specifications and claims; the essence
of my invention being, the use of the motive power of the electric or galvanic
current, which I call electro-magnetism, however developed, for making or
printing intelligible characters, letters or signs, at any distances, being a
new application of that power of which I claim to be the first inventor or
discoverer.
ꢀ Figure 1. Samuel Morse patent claim – rejected by the U.S. Supreme Court
as overreaching.
DEMISE OF THE MATHEMATICAL ALGORITHM
The Supreme Court’s decision in Morse set the
tone for later decisions that held certain subject
matter — laws of nature, natural phenomena,
and abstract ideas — to be forbidden ground,
on which the patent system was not to tread.
Particularly noteworthy was the 1972 Supreme
Court decision in Gottschalk v. Benson [2]. In
that case one Bell Laboratories inventor, named
Benson, sought to patent a computer algorithm
for converting binary coded decimal numbers
(BCD) into binary numbers. Figure 2 shows a
representative Benson claim in which he recites
his basic conversion algorithm. The Supreme
Court struck down the patent. Following the
precedent in Morse, the Court ruled that Ben-
son’s algorithm was simply a mathematical for-
mula, and hence it was an inherently
nonpatentable abstract idea.
The 1972 Benson decision brought the advance-
ment of software patents to a grinding stop. It was
as if the tectonic plate on which software patent
law had been advancing suddenly collided with the
plate on which Morse’s patent had rested. In the
years after Benson, software programs were dis-
missed as being mere mathematical algorithms.
Relying on the Benson decision, the Patent Office
refused to grant software patents, and most appli-
cants either quit seeking them, or disguised them
as computer hardware patents.
and thus also arguably proper subject matter
for patent. Indeed, just one year after
Chakrabarty, the Supreme Court in Diamond v.
Diehr [4] ruled-without denigrating Benson-that
computer programs directed to performing
practical applications are proper subject matter
for patent. In that case, the computer program
performed a mathematical calculation to deter-
mine when to open the press in a precision rub-
ber molding process. One can distinguish the
Diehr decision from Benson. Whereas the patent
applicant in Benson had sought to appropriate
the abstract mathematical algorithm in its
entirety, the applicant in Diehr had simply
sought to appropriate an algorithm for operat-
ing a rubber mold press.
This distinction between Benson and Diehr was
not easy for the Patent Office to administer. The
decisions suggested that if a computer program
employed a mathematical algorithm-which
arguably many of them did-the patent examiner
had to struggle with whether the applicant’s
patent claim was, in effect, preempting the under-
lying abstract idea embodied in that algorithm [5].
Such esoteric analysis was fraught with difficulty.
Many examiners erred on the side of caution and
deemed all software inventions to be preempting
an abstract idea, leaving the patent applicant to
convince the courts otherwise.
Then in 1980, a tremor occurred along the fault
line, and the software patent plate broke free. Curi-
ously, at the epicenter was not a computer pro-
gram, but a tiny bioengineered microorganism.
Finally, in 1995, the Federal Circuit Court of
Appeals ruled in In re Alappat [6] that the former
preoccupation with the mathematical algorithm
was misplaced. Dismissing the mathematical algo-
rithm analysis as unhelpful, the Court outlined a
simpler plan. It looked to the basic patent statute,
which had been on the books since 1952 and is
LIFE WILL FIND A WAY
Scientists at General Electric had genetically
engineered a clever microorganism that had an
appetite for petroleum. That made the tiny
organism ideal for cleaning up oil spills in the
ocean. GE sought a patent, which the Patent
Office refused to grant. This microorganism was,
after all, a life form. Life was a natural phe-
nomenon, and the Patent Office simply refused
to acknowledge that it might constitute
patentable subject matter.
Remarkably, the Supreme Court saw things
differently. It ruled in Diamond v. Chakrabarty
[3] that, life form or not, Congress had intended
the patent laws to extend to “anything under the
sun that is made by man.” This genetically
altered microorganism did not exist in nature.
Hence GE’s patent claim, the Court reasoned,
“is not to a hitherto unknown natural phe-
nomenon, but to a non-naturally occurring man-
ufacture or composition of matter — a product
of human ingenuity.”
A data processing method for converting binary coded decimal number repre-
sentations into binary number representations comprising the steps of
(1) testing each binary digit position ‘1,’ beginning with the least significant
binary digit position, of the most significant decimal digit representation for a
binary ‘0’ or a binary ‘1’;
(2) if a binary ‘0’ is detected, repeating step (1) for the next least significant
binary digit position of said most significant decimal digit representation;
(3) if a binary ‘1’ is detected, adding a binary ‘1’ at the (i + 1)th and (i +
3)th least significant binary digit positions of the next lesser significant deci-
mal digit representation, and repeating step (1) for the next least significant
binary digit position of said most significant decimal digit representation;
(4) upon exhausting the binary digit positions of said most significant deci-
mal digit representation, repeating steps (1) through (3) for the next lesser
significant decimal digit representation as modified by the previous execution
of steps (1) through (3); and
(5) repeating steps (1) through (4) until the second least significant decimal
digit representation has been so processed.
After the Chakrabarty decision, it took little
time for many to recognize that computer soft-
ware was also a product of human ingenuity,
ꢀ Figure 2. Example: the Benson BCD to binary conversion claim — rejected
by the Supreme Court as unlawfully preempting a mathematical algorithm.
IEEE Communications Magazine • July 2000
99

attention was on computer-readable memory
(such as a RAM chip or CD-ROM). Computer
memory became the bottle into which many
applicants would stuff their software genies,
seeking to obtain patents. Computer memory
was, after all, a physical object that seemed to fit
the concept of a manufacture.
A computer data signal embodied in a carrier wave, comprising:
instructions for receiving objects transmitted by network entities, wherein at
least a subset of the received objects each include source and destination
methods and data associated with the source and destination methods; and
an incoming object handler to handle the subset of the received objects, the
incoming object handler including a source and destination verifier to execute
the source and destination methods of each received object with their associ-
ated data so as to verify the source and destination of the received object.
However, this time the Patent Office took a
bold step forward-without being first prodded
by the Court. Shortly after issuing its Examina-
tion Guidelines for Computer-Related Inven-
tions [9], it distributed a set of training
materials to its software patent examiners,
instructing them to treat computer software
embodied in a carrier wave as an article of man-
ufacture. Computer memories are physical
objects that are fairly easy to categorize as arti-
cles of manufacture. But carrier waves are pure
energy. That the Patent Office was willing to
accept software inventions embodied as propa-
gating energy surprised many-but savvy patent
applicants didn’t waste any time to exploit this
new article of manufacture claim. Figure 3
shows an example of such a claim. The example
is taken from a patent, owned by Sun Microsys-
tems, for a secure network protocol that uses
object technology.
ꢀ Figure 3. Example : the computer data signal claim, Sun Microsystems, U.S.
Patent 5,850,449, issued December 15, 1998.
still the law today. That statute identifies four
broad categories of subject matter for which
patents may be granted: new and useful process-
es, machines, manufactures, and compositions of
matter. The subject matter in Alappat was a
machine — a rasterizer for removing aliasing in
the displayed waveform of a digital oscilloscope.
Alappat’s solution used an algorithm to modu-
late beam intensity, to fool the eye into seeing a
smooth-appearing waveform.
The Alappat court ruled that new and useful
computer software is patentable subject matter if
it can be classified into one of these four cate-
gories. Notably, the court said that while the
abstract idea remains off limits, the mathemati-
cal algorithm does not.
Would the Alappat court’s analysis have
helped Samuel Morse? Probably not. Morse’s
claim was to the abstract idea of using electro-
magnetism to communicate at a distance. That is
not to say that Morse would not have been enti-
tled to claim a machine that uses electromag-
netism to communicate at a distance, or a
process that exploits electromagnetism to effect
communication at a distance. Unfortunately for
Morse, he had elected not to be so modest.
THE INFRINGING MOUSE CLICK
What are the implications of these new article of
manufacture claims? Do they reach farther than
the more traditional claim to a machine or pro-
cess? The answer is yes. The reason lies within
the patent grant.
A United States patent grants to its owner
the right to exclude others from making, using,
selling, offering to sell, or importing the patent-
ed technology [10]. However, the patent owner’s
right to exclude extends only to the invention
claimed. Each and every element of a claim is
essential. If someone can accomplish the same
thing by completely omitting one of the claimed
elements or its equivalent, the patent claim is
not infringed.
THE PATENTED PROPAGATED
DATA SIGNAL IS BORN
Thus, a patent claim to a computer-imple-
mented process would not be infringed unless
someone actually performs the process, by
loading the software on a computer and run-
ning it. The claim would arguably not be
infringed by the company who merely made
and distributed the software but did not other-
wise perform the patented steps. In short, with-
out the computer, the software alone does not
perform the patented process. The patent
owner would be forced to sue the end user and
could only proceed against the manufacturer as
a contributory infringer-assuming the software
had no other noninfringing uses.
A patent claim to the software as a manufac-
ture avoids the problem. By claiming the soft-
ware as a computer program embodied in a
computer memory, the patent owner is able to
proceed against the manufacturer who made and
sold the floppy disk or CD-ROM containing the
patented program. The patent owner is not
required to sue the end user. Similarly, by claim-
ing the software as executable computer data
embodied in a carrier wave, the patent owner is
able to proceed against the manufacturer who
places the software on a web server to be
The Alappat decision created quite a stir, and it
forced a clear Patent Office shift in favor of soft-
ware patents. No longer would software inven-
tions be dismissed simply as mathematical
algorithms. Instead, the focus would be on
whether the software invention was novel and
nonobvious.
Within a year patent applicants were pushing
the limits of the new Alappat patentability model.
Software patent filings skyrocketed. As expected,
applicants began characterizing their software
inventions as computer-implemented machines
or computer-implemented processes. More inge-
nious, some applicants even characterized their
software inventions as “articles of manufacture.”
The article of manufacture was a computer-read-
able memory that contained data arranged in a
particular data structure. At first the Patent
Office resisted the article of manufacture claims.
However, after it received a stinging defeat in
the Federal Circuit Court [7], the Patent Office
gave in and agreed to accept software patents
embodied as articles of manufacture [8].
When the Patent Office announced its accep-
tance of article of manufacture claims, initial
IEEE Communications Magazine • July 2000
100

“embodied” in a carrier wave and sold to the
end user on demand.
SAMUEL MORSE FINALLY VINDICATED
A computer data
signal claim could
be infringed by a
single mouse
In short, a computer data signal claim could
be infringed by a single mouse click. Clicking on
a hyperlink to initiate shipment of the carrier
wave-embodied software would arguably constitute
a sale of the patented manufacture. Indeed, merely
making it available on a Web site for download
might constitute an offer for sale. Furthermore,
some have suggested that shipment of the infring-
ing carrier-wave-embodied software could even
expose all carriers of the signal to liability. This
would include, for example, the Internet service
provider and the telephone company [11].
Truly, propagated signal claims are powerful
weapons against software patent infringement;
and they represent potentially dangerous snares
for the telecommunications industry. Will the
legal system someday wake up to find that this
has all been a dream? Not likely. If anything, the
trend of late has been to increase the reach of
patent law. For instance, less than two years ago,
the Federal Circuit Court ruled unequivocally
that pure business methods are also within the
bailiwick of patent law.
What can be done? First of all, don’t panic.
Arm yourself with the facts. Start with a visit to
the U.S. Patent Office’s full-text database search
web page [12]. There you can conduct a Boolean
search for use of terms such as “carrier wave” in
the “claims” field of all U.S. patents issued from
1976 to present. Although not all of the search
results will be propagated data signal claims,
many of them will be. Peruse the claims of inter-
est, noting the assignee or owner of each patent
of interest. Much can be learned from such a
study. It gives advanced warning of technological
paths to avoid, and it helps spark creativity by
suggesting areas within your business that may
be eligible for patent protection.
Lest we leave with the impression that Morse
was the big looser in all of this, one little known
fact should now be disclosed. The Supreme
Court did not strike down all of Morse’s patent
claims. Morse actually did get to keep the fol-
lowing claim:
“I claim as my invention, the system of signs,
consisting of dots and spaces, and of dots, spaces,
and horizontal lines, for numerals, letters, words,
or sentences, substantially as herein set forth
and illustrated, for telegraphic purposes.”
Could it be that Morse was actually the first
to patent the propagated signal after all? What
hath God wrought, indeed.
click. Clicking on
a hyperlink to
initiate shipment
of the carrier
wave-embodied
software would
arguably
REFERENCES
[1] O’Reilly vs. Morse, 56 U.S. 62 (1854).
constitute a sale
of the patented
manufacture.
[2] Gottschalk vs. Benson, 409 U.S. 63 (1972).
[3] Diamond vs. Chakrabarty, 447 U.S. 303 (1980).
[4] Diamond vs. Diehr, 450 U.S. 175 (1981).
[5] The test is known as the Freeman-Walter-Abele test
which grew out of a series of appellate court decisions
that were trying to interpret Benson and Diehr.
[6] In re Alappat, 33 F.3d 1526 (Fed. Cir. 1994).
[7] In re Lowry, 32 F.3d 1579 (Fed. Cir. 1994).
[8] Examination Guidelines for Computer-Related Inven-
tions, U.S. Patent and Trademark Office, Mar. 29, 1996.
[9] Ibid.
[10] 35 United States Code, Sec. 271.
[11] S. Horsetmeyer and D. Santos, “A New Frontier in
Patents: Patent Claims to Propagated Signals,” Intellec-
tual Property Today, July 1998, pp. 16–21.
[12] http://www.uspto.gov/patft/index.html
BIOGRAPHY
GREGORY A. STOBBS (stobbs@hdp.com) is a principal in the
patent law firm of Harness, Dickey & Pierce, where he spe-
cializes in computers and software. He is the author of the
patent law treatise, Software Patents, published by Aspen
Law & Business. He also writes a monthly column, Soft-
ware Practice News, for Intellectual Property Today.
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