Since the late 1960's, the question of legal protection for computer software has been the basis for battle between the Court of Customs and Patent Appeals (CCPA) and the Patent and Trademark Office (PTO). The Patent Office generally has considered processes using mathematical formulas to be unpatentable subject matter under 35 USC § 101. The CCPA, considering appeals from the PTO Board of Appeals, consistently has reached the opposite conclusion. Prior to 1981, the Supreme Court delivered only three major decisions which addressed the issue. Although the Court did not find the inventions claimed in those cases to be patentable, it did not reject the possibility that claims involving computer programs could be patentable subject matter under § 101. The rapid technological advances in computers in the past thirty years have meant a tremendous growth in sales in the computer industry. The software industry has grown as rapidly as computer technology, because without software, computer hardware is useless. The question of patentability is one which the computer industry would like resolved quickly, because the profits in question could be sizeable if the courts hold that software is patentable. In the most recent attempt to resolve the battle between the CCPA and the PTO, the Supreme Court, in a 5-4 decision in Diamond v. Diehr, determined that a process which requires the use of a mathematical formula and a computer is patentable subject matter under § 101.
Ron Karl Levy, Patent Law - The Next-to-Last Step to Software Patentability?, 4 Campbell L. Rev. 219 (1981).