> In Thursday's ruling, the court rejected a patent that claimed the concept of using a computer to hedge against "counterparty risk" — the risk of making a bargain and then having the other guy not pay up. The Supreme Court complained that in the process described in the patent, "each step does no more than require a generic computer to perform generic computer functions." Such a generic patent, the court said, isn't eligible for patent protection. The problem is that this criticism can be leveled at literally any software patent. At root, software is nothing more than a sequence of mathematical operations.
The Supreme Court in Alice came to two conclusions:
1) The concept of intermediated settlement is a "fundamental economic practice" and is so ineligible for patent protection under the judicially-created exception Section 101 for "abstract ideas."
2) The "method" and "system" claims in Alice Corp.'s patent amounted to nothing more than describing how to implement intermediated settlement on a generic computer in a generic way, and did not render the otherwise unpatentable abstract idea patentable.
The purpose of (2) is to foreclose on clever drafting that tries to get around the "abstract idea" limitation by framing it in terms of a specific implementation on a computer. What Alice says is that implementing the idea in a generic computer doesn't turn an abstract idea into a concrete implementation. It does not say that an otherwise patentable idea is rendered unpatentable because the patent describes how to implement the idea in a generic computer.