(Slip Opinion)

OCTOBER TERM, 2013

1

Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.

SUPREME COURT OF THE UNITED STATES
Syllabus

ALICE CORPORATION PTY. LTD. v. CLS BANKINTERNATIONAL ET AL.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE FEDERAL CIRCUIT
No. 13–298.

Argued March 31, 2014—Decided June 19, 2014

Petitioner Alice Corporation is the assignee of several patents that disclose a scheme for mitigating “settlement risk,” i.e., the risk that only
one party to an agreed-upon financial exchange will satisfy its obligation. In particular, the patent claims are designed to facilitate theexchange of financial obligations between two parties by using acomputer system as a third-party intermediary. The patents in suitclaim (1) a method for exchanging financial obligations, (2) a computer system configured to carry out the method for exchanging obligations, and (3) a computer-readable medium containing program codefor performing the method of exchanging obligations.
Respondents (together, CLS Bank), who operate a global networkthat facilitates currency transactions, filed suit against petitioner,arguing that the patent claims at issue are invalid, unenforceable, or
not infringed. Petitioner counterclaimed, alleging infringement. After Bilski v. Kappos, 561 U. S. 593, was decided, the District Court
held that all of the claims were ineligible for patent protection under
35 U. S. C. §101 because they are directed to an abstract idea. The
en banc Federal Circuit affirmed.
Held: Because the claims are drawn to a patent-ineligible abstract idea,
they are not patent eligible under §101. Pp. 5–17.
(a) The Court has long held that §101, which defines the subject
matter eligible for patent protection, contains an implicit exceptionfor ‘ “[l]aws of nature, natural phenomena, and abstract ideas.’ ” Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U. S.
___, ___. In applying the §101 exception, this Court must distinguishpatents that claim the “ ‘buildin[g] block[s]’ ” of human ingenuity,which are ineligible for patent protection, from those that integrate

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ALICE CORP. v. CLS BANK INT’L
Syllabus
the building blocks into something more, see Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U. S. ___, ___, thereby“transform[ing]” them into a patent-eligible invention, id., at ___.
Pp. 5–6.
(b) Using this framework, the Court must first determine whether
the claims at issue are directed to a patent-ineligible concept. 566
U. S., at ___. If so, the Court then asks whether the claim’s elements,
considered both individually and “as an ordered combination,” “transform the nature of the claim” into a patent-eligible application. Id.,
at ___. Pp. 7–17.
(1) The claims at issue are directed to a patent-ineligible concept:
the abstract idea of intermediated settlement. Under “the longstanding rule that ‘[a]n idea of itself is not patentable,’ ” Gottschalk v. Benson, 409 U. S. 63, 67, this Court has found ineligible patent claims
involving an algorithm for converting binary-coded decimal numerals
into pure binary form, id., at 71–72; a mathematical formula for computing “alarm limits” in a catalytic conversion process, Parker v.
Flook, 437 U. S. 584, 594–595; and, most recently, a method for hedging against the financial risk of price fluctuations, Bilski, 561 U. S, at
599. It follows from these cases, and Bilski in particular, that theclaims at issue are directed to an abstract idea. On their face, they
are drawn to the concept of intermediated settlement, i.e., the use ofa third party to mitigate settlement risk. Like the risk hedging in
Bilski, the concept of intermediated settlement is “ ‘a fundamental
economic practice long prevalent in our system of commerce,’ ” ibid.,and the use of a third-party intermediary (or “clearing house”) is abuilding block of the modern economy. Thus, intermediated settlement, like hedging, is an “abstract idea” beyond §101’s scope. Pp. 7–
10.
(2) Turning to the second step of Mayo’s framework: The method
claims, which merely require generic computer implementation, failto transform that abstract idea into a patent-eligible invention.
Pp. 10–16.
(i) “Simply appending conventional steps, specified at a highlevel of generality,” to a method already “well known in the art” is not“enough” to supply the “ ‘inventive concept’ ” needed to make thistransformation. Mayo, supra, at ___, ___. The introduction of a computer into the claims does not alter the analysis. Neither stating an
abstract idea “while adding the words ‘apply it,’ ” Mayo, supra, at ___,
nor limiting the use of an abstract idea “ ‘to a particular technologicalenvironment,’ ” Bilski, supra, at 610–611, is enough for patent eligibility. Stating an abstract idea while adding the words “apply it witha computer” simply combines those two steps, with the same deficientresult. Wholly generic computer implementation is not generally theCite as: 573 U. S. ____ (2014)3

Syllabus
sort of “additional featur[e]” that provides any “practical assurance
that the process is more than a drafting effort designed to monopolize
the [abstract idea] itself.” Mayo, supra, at ___. Pp. 11–14.
(ii) Here, the representative method claim does no more thansimply instruct the practitioner to implement the abstract idea of intermediated settlement on a generic computer. Taking the claim elements separately, the function performed by the computer at each
step—creating and maintaining “shadow” accounts, obtaining data,
adjusting account balances, and issuing automated instructions—is“[p]urely ‘conventional. ’ ” Mayo, 566 U. S., at ___. Considered “as anordered combination,” these computer components “ad[d] nothing . . .
that is not already present when the steps are considered separately.” Id., at ___. Viewed as a whole, these method claims simply recite
the concept of intermediated settlement as performed by a genericcomputer. They do not, for example, purport to improve the functioning of the computer itself or effect an improvement in any other technology or technical field. An instruction to apply the abstract idea ofintermediated settlement using some unspecified, generic computeris not “enough” to transform the abstract idea into a patent-eligible
invention. Id., at ___. Pp. 14–16.
(3) Because petitioner’s system and media claims add nothing of
substance to the underlying abstract idea, they too are patent ineligible under §101. Petitioner conceded below that its media claims riseor fall with its method claims. And the system claims are no different in substance from the method claims. The method claims recite
the abstract idea implemented on a generic computer; the system
claims recite a handful of generic computer components configured to
implement the same idea. This Court has long “warn[ed] . . . against”
interpreting §101 “in ways that make patent eligibility ‘depend simply on the draftsman’s art.’ ” Mayo, supra, at ___. Holding that thesystem claims are patent eligible would have exactly that result.
Pp. 16–17.
717 F. 3d 1269, affirmed.
THOMAS, J., delivered the opinion for a unanimous Court.

SO-

TOMAYOR, J., filed a concurring opinion, in which GINSBURG and BREYER,

JJ., joined.

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Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Washington, D. C. 20543, of any typographical or other formal errors, in orderthat corrections may be made before the preliminary print goes to press.

SUPREME COURT OF THE UNITED STATES_________________

No. 13–298_________________ALICE CORPORATION PTY. LTD, PETITIONER v. CLSBANK INTERNATIONAL ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT[June 19, 2014]JUSTICE THOMAS delivered the opinion of the Court.
The patents at issue in this case disclose a computerimplemented scheme for mitigating “settlement risk” (i.e.,
the risk that only one party to a financial transaction will
pay what it owes) by using a third-party intermediary.
The question presented is whether these claims are patenteligible under 35 U. S. C. §101, or are instead drawn to apatent-ineligible abstract idea. We hold that the claims at
issue are drawn to the abstract idea of intermediatedsettlement, and that merely requiring generic computer
implementation fails to transform that abstract idea into apatent-eligible invention. We therefore affirm the judgment of the United States Court of Appeals for the Federal
Circuit.
I
A
Petitioner Alice Corporation is the assignee of several
patents that disclose schemes to manage certain forms offinancial risk.1 According to the specification largely——————
1 The patents at issue are United States Patent Nos. 5,970,479 (the2

ALICE CORP. v. CLS BANK INT’L
Opinion of the Court

shared by the patents, the invention “enabl[es] the management of risk relating to specified, yet unknown, future
events.” App. 248. The specification further explains thatthe “invention relates to methods and apparatus, including electrical computers and data processing systems
applied to financial matters and risk management.” Id.,
at 243.
The claims at issue relate to a computerized scheme for
mitigating “settlement risk”—i.e., the risk that only one
party to an agreed-upon financial exchange will satisfy its
obligation. In particular, the claims are designed to facilitate the exchange of financial obligations between two
parties by using a computer system as a third-party intermediary. Id., at 383–384.2 The intermediary creates“shadow” credit and debit records (i.e., account ledgers)——————’479 patent), 6,912,510, 7,149,720, and 7,725,375.
2 The parties agree that claim 33 of the ’479 patent is representativeof the method claims. Claim 33 recites:“A method of exchanging obligations as between parties, each party
holding a credit record and a debit record with an exchange institution,
the credit records and debit records for exchange of predetermined
obligations, the method comprising the steps of:“(a) creating a shadow credit record and a shadow debit record foreach stakeholder party to be held independently by a supervisory
institution from the exchange institutions;“(b) obtaining from each exchange institution a start-of-day balance
for each shadow credit record and shadow debit record;“(c) for every transaction resulting in an exchange obligation, thesupervisory institution adjusting each respective party’s shadow credit
record or shadow debit record, allowing only these transactions that do
not result in the value of the shadow debit record being less than thevalue of the shadow credit record at any time, each said adjustment
taking place in chronological order, and“(d) at the end-of-day, the supervisory institution instructing on[e] ofthe exchange institutions to exchange credits or debits to the credit
record and debit record of the respective parties in accordance with theadjustments of the said permitted transactions, the credits and debits
being irrevocable, time invariant obligations placed on the exchange
institutions.” App. 383–384.

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Opinion of the Court

that mirror the balances in the parties’ real-world accounts at “exchange institutions” (e.g., banks). The intermediary updates the shadow records in real time as transactions are entered, allowing “only those transactions forwhich the parties’ updated shadow records indicate sufficient resources to satisfy their mutual obligations.” 717
F. 3d 1269, 1285 (CA Fed. 2013) (Lourie, J., concurring).
At the end of the day, the intermediary instructs therelevant financial institutions to carry out the “permitted”
transactions in accordance with the updated shadow
records, ibid., thus mitigating the risk that only one party
will perform the agreed-upon exchange.
In sum, the patents in suit claim (1) the foregoing method
for exchanging obligations (the method claims), (2) acomputer system configured to carry out the method forexchanging obligations (the system claims), and (3) acomputer-readable medium containing program code for
performing the method of exchanging obligations (themedia claims). All of the claims are implemented using acomputer; the system and media claims expressly recite acomputer, and the parties have stipulated that the method
claims require a computer as well.
B
Respondents CLS Bank International and CLS Services
Ltd. (together, CLS Bank) operate a global network thatfacilitates currency transactions. In 2007, CLS Bank filed
suit against petitioner, seeking a declaratory judgmentthat the claims at issue are invalid, unenforceable, or not
infringed. Petitioner counterclaimed, alleging infringement. Following this Court’s decision in Bilski v. Kappos,
561 U. S. 593 (2010), the parties filed cross-motions forsummary judgment on whether the asserted claims are
eligible for patent protection under 35 U. S. C. §101. The
District Court held that all of the claims are patent ineligible because they are directed to the abstract idea of

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ALICE CORP. v. CLS BANK INT’L
Opinion of the Court“employing a neutral intermediary to facilitate simultaneous exchange of obligations in order to minimize risk.”
768 F. Supp. 2d 221, 252 (DC 2011).
A divided panel of the United States Court of Appeals
for the Federal Circuit reversed, holding that it was not“manifestly evident” that petitioner’s claims are directed
to an abstract idea. 685 F. 3d 1341, 1352, 1356 (2012).
The Federal Circuit granted rehearing en banc, vacatedthe panel opinion, and affirmed the judgment of the District Court in a one-paragraph per curiam opinion. 717
F. 3d, at 1273. Seven of the ten participating judges
agreed that petitioner’s method and media claims arepatent ineligible. See id., at 1274 (Lourie, J., concurring);
id., at 1312–1313 (Rader, C. J., concurring in part anddissenting in part). With respect to petitioner’s system
claims, the en banc Federal Circuit affirmed the District
Court’s judgment by an equally divided vote. Id., at 1273.
Writing for a five-member plurality, Judge Lourie concluded that all of the claims at issue are patent ineligible.
In the plurality’s view, under this Court’s decision in Mayo
Collaborative Services v. Prometheus Laboratories, Inc.,
566 U. S. ___ (2012), a court must first “identif[y] theabstract idea represented in the claim,” and then determine “whether the balance of the claim adds ‘significantly
more.’ ” 717 F. 3d, at 1286. The plurality concluded that
petitioner’s claims “draw on the abstract idea of reducing
settlement risk by effecting trades through a third-party
intermediary,” and that the use of a computer to maintain,
adjust, and reconcile shadow accounts added nothing of
substance to that abstract idea. Ibid.
Chief Judge Rader concurred in part and dissented inpart. In a part of the opinion joined only by Judge Moore,
Chief Judge Rader agreed with the plurality that petitioner’s method and media claims are drawn to an abstract
idea. Id., at 1312–1313. In a part of the opinion joined byJudges Linn, Moore, and O’Malley, Chief Judge RaderCite as: 573 U. S. ____ (2014)

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Opinion of the Court

would have held that the system claims are patent eligible
because they involve computer “hardware” that is “specifically programmed to solve a complex problem.” Id., at1307. Judge Moore wrote a separate opinion dissenting inpart, arguing that the system claims are patent eligible.
Id., at 1313–1314. Judge Newman filed an opinion concurring in part and dissenting in part, arguing that all ofpetitioner’s claims are patent eligible. Id., at 1327. Judges
Linn and O’Malley filed a separate dissenting opinion
reaching that same conclusion. Ibid.
We granted certiorari, 571 U. S. ___ (2013), and now
affirm.
II
Section 101 of the Patent Act defines the subject matter
eligible for patent protection. It provides:“Whoever invents or discovers any new and usefulprocess, machine, manufacture, or composition ofmatter, or any new and useful improvement thereof,
may obtain a patent therefor, subject to the conditions
and requirements of this title.” 35 U. S. C. §101.
“We have long held that this provision contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable.” Association for Molecular Pathology v. Myriad Genetics, Inc., 569
U. S. ___, ___ (2013) (slip op., at 11) (internal quotation
marks and brackets omitted). We have interpreted §101and its predecessors in light of this exception for morethan 150 years. Bilski, supra, at 601–602; see also
O’Reilly v. Morse, 15 How. 62, 112–120 (1854); Le Roy v.
Tatham, 14 How. 156, 174–175 (1853).
We have described the concern that drives this exclusionary principle as one of pre-emption. See, e.g., Bilski,
supra, at 611–612 (upholding the patent “would pre-empt
use of this approach in all fields, and would effectively

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Opinion of the Court

grant a monopoly over an abstract idea”). Laws of nature,
natural phenomena, and abstract ideas are “ ‘ “the basic
tools of scientific and technological work.” ’ ” Myriad,
supra, at ___ (slip op., at 11). “[M]onopolization of those
tools through the grant of a patent might tend to impede
innovation more than it would tend to promote it,” thereby
thwarting the primary object of the patent laws. Mayo,supra, at ___ (slip op., at 2); see U. S. Const., Art. I, §8, cl.
8 (Congress “shall have Power . . . To promote the Progress of Science and useful Arts”). We have “repeatedlyemphasized this . . . concern that patent law not inhibit
further discovery by improperly tying up the future useof ” these building blocks of human ingenuity. Mayo,supra, at ___ (slip op., at 16) (citing Morse, supra, at 113).
At the same time, we tread carefully in construing thisexclusionary principle lest it swallow all of patent law.
Mayo, 566 U. S., at ___ (slip op., at 2). At some level, “allinventions . . . embody, use, reflect, rest upon, or apply
laws of nature, natural phenomena, or abstract ideas.”
Id., at ___ (slip op., at 2). Thus, an invention is not rendered ineligible for patent simply because it involves anabstract concept. See Diamond v. Diehr, 450 U. S. 175,
187 (1981). “[A]pplication[s]” of such concepts “ ‘to a new
and useful end,’ ” we have said, remain eligible for patent
protection. Gottschalk v. Benson, 409 U. S. 63, 67 (1972).
Accordingly, in applying the §101 exception, we must
distinguish between patents that claim the “ ‘buildin[g]block[s]’ ” of human ingenuity and those that integrate thebuilding blocks into something more, Mayo, 566 U. S., at___ (slip op., at 20), thereby “transform[ing]” them into apatent-eligible invention, id., at ___ (slip op., at 3). The
former “would risk disproportionately tying up the use of
the underlying” ideas, id., at ___ (slip op., at 4), and are
therefore ineligible for patent protection. The latter poseno comparable risk of pre-emption, and therefore remain
eligible for the monopoly granted under our patent laws.

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Opinion of the Court

III
In Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U. S. ___ (2012), we set forth a frameworkfor distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim
patent-eligible applications of those concepts. First, we
determine whether the claims at issue are directed to oneof those patent-ineligible concepts. Id., at ___ (slip op., at8). If so, we then ask, “[w]hat else is there in the claims
before us?” Id., at ___ (slip op., at 9). To answer thatquestion, we consider the elements of each claim bothindividually and “as an ordered combination” to determine
whether the additional elements “transform the nature of
the claim” into a patent-eligible application. Id., at ___(slip op., at 10, 9). We have described step two of thisanalysis as a search for an “ ‘inventive concept’ ”—i.e., anelement or combination of elements that is “sufficient toensure that the patent in practice amounts to significantly
more than a patent upon the [ineligible concept] itself.”
Id., at ___ (slip op., at 3).3A
We must first determine whether the claims at issue are
directed to a patent-ineligible concept. We conclude thatthey are: These claims are drawn to the abstract idea ofintermediated settlement.
The “abstract ideas” category embodies “the longstanding rule that ‘[a]n idea of itself is not patentable.’ ” Benson, supra, at 67 (quoting Rubber-Tip Pencil Co. v. Howard, 20 Wall. 498, 507 (1874)); see also Le Roy, supra, at——————
3 Because the approach we made explicit in Mayo considers all claim
elements, both individually and in combination, it is consistent with thegeneral rule that patent claims “must be considered as a whole.”
Diamond v. Diehr, 450 U. S. 175, 188 (1981); see Parker v. Flook, 437
U. S. 584, 594 (1978) (“Our approach . . . is . . . not at all inconsistent
with the view that a patent claim must be considered as a whole”).

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175 (“A principle, in the abstract, is a fundamental truth;
an original cause; a motive; these cannot be patented, as
no one can claim in either of them an exclusive right ”). In
Benson, for example, this Court rejected as ineligible
patent claims involving an algorithm for converting binarycoded decimal numerals into pure binary form, holdingthat the claimed patent was “in practical effect . . . a patent on the algorithm itself.” 409 U. S., at 71–72. And in
Parker v. Flook, 437 U. S. 584, 594–595 (1978), we heldthat a mathematical formula for computing “alarm limits”
in a catalytic conversion process was also a patentineligible abstract idea.
We most recently addressed the category of abstract
ideas in Bilski v. Kappos, 561 U. S. 593 (2010). The claims
at issue in Bilski described a method for hedging against
the financial risk of price fluctuations. Claim 1 recited aseries of steps for hedging risk, including: (1) initiating aseries of financial transactions between providers andconsumers of a commodity; (2) identifying market participants that have a counterrisk for the same commodity;and (3) initiating a series of transactions between thosemarket participants and the commodity provider to balance the risk position of the first series of consumer transactions. Id., at 599. Claim 4 “pu[t] the concept articulated
in claim 1 into a simple mathematical formula.” Ibid. The
remaining claims were drawn to examples of hedging incommodities and energy markets.
“[A]ll members of the Court agree[d]” that the patent at
issue in Bilski claimed an “abstract idea.” Id., at 609; seealso id., at 619 (Stevens, J., concurring in judgment).
Specifically, the claims described “the basic concept ofhedging, or protecting against risk.” Id., at 611. The
Court explained that “ ‘[h]edging is a fundamental economic
practice long prevalent in our system of commerce andtaught in any introductory finance class.’ ” Ibid. “Theconcept of hedging” as recited by the claims in suit wasCite as: 573 U. S. ____ (2014)

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Opinion of the Court

therefore a patent-ineligible “abstract idea, just like thealgorithms at issue in Benson and Flook.” Ibid.
It follows from our prior cases, and Bilski in particular,that the claims at issue here are directed to an abstract
idea. Petitioner’s claims involve a method of exchanging
financial obligations between two parties using a thirdparty intermediary to mitigate settlement risk. The intermediary creates and updates “shadow” records to reflect the value of each party’s actual accounts held at“exchange institutions,” thereby permitting only thosetransactions for which the parties have sufficient resources. At the end of each day, the intermediary issues
irrevocable instructions to the exchange institutions tocarry out the permitted transactions.
On their face, the claims before us are drawn to theconcept of intermediated settlement, i.e., the use of a third
party to mitigate settlement risk. Like the risk hedging in
Bilski, the concept of intermediated settlement is “ ‘afundamental economic practice long prevalent in oursystem of commerce.’ ” Ibid.; see, e.g., Emery, Speculationon the Stock and Produce Exchanges of the United States,in 7 Studies in History, Economics and Public Law 283,
346–356 (1896) (discussing the use of a “clearing-house” asan intermediary to reduce settlement risk). The use of athird-party intermediary (or “clearing house”) is also abuilding block of the modern economy. See, e.g., Yadav,
The Problematic Case of Clearinghouses in Complex Markets, 101 Geo. L. J. 387, 406–412 (2013); J. Hull, Risk
Management and Financial Institutions 103–104 (3d ed.
2012). Thus, intermediated settlement, like hedging, is an“abstract idea” beyond the scope of §101.
Petitioner acknowledges that its claims describe intermediated settlement, see Brief for Petitioner 4, but rejects
the conclusion that its claims recite an “abstract idea.”
Drawing on the presence of mathematical formulas insome of our abstract-ideas precedents, petitioner contends

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Opinion of the Court

that the abstract-ideas category is confined to “preexisting, fundamental truth[s]” that “ ‘exis[t ] in principle apartfrom any human action.’ ” Id., at 23, 26 (quoting Mayo,
566 U. S., at ___ (slip op., at 8)).
Bilski belies petitioner’s assertion. The concept of risk
hedging we identified as an abstract idea in that casecannot be described as a “preexisting, fundamental truth.”
The patent in Bilski simply involved a “series of steps
instructing how to hedge risk.” 561 U. S., at 599. Although hedging is a longstanding commercial practice, id.,
at 599, it is a method of organizing human activity, not a“truth” about the natural world “ ‘that has always existed,’ ”
Brief for Petitioner 22 (quoting Flook, supra, at 593,
n. 15). One of the claims in Bilski reduced hedging to amathematical formula, but the Court did not assign any
special significance to that fact, much less the sort oftalismanic significance petitioner claims. Instead, theCourt grounded its conclusion that all of the claims at
issue were abstract ideas in the understanding that risk
hedging was a “ ‘fundamental economic practice.’ ” 561
U. S., at 611.
In any event, we need not labor to delimit the precise
contours of the “abstract ideas” category in this case. It isenough to recognize that there is no meaningful distinction between the concept of risk hedging in Bilski and theconcept of intermediated settlement at issue here. Bothare squarely within the realm of “abstract ideas” as wehave used that term.
B
Because the claims at issue are directed to the abstract
idea of intermediated settlement, we turn to the second
step in Mayo’s framework. We conclude that the method
claims, which merely require generic computer implementation, fail to transform that abstract idea into a patenteligible invention.

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1
At Mayo step two, we must examine the elements of theclaim to determine whether it contains an “ ‘inventive
concept’ ” sufficient to “transform” the claimed abstract
idea into a patent-eligible application. 566 U. S., at ___,___ (slip op., at 3, 11). A claim that recites an abstract
idea must include “additional features” to ensure “that the[claim] is more than a drafting effort designed to monopolize the [abstract idea].” Id., at ___ (slip op., at 8–9). Mayomade clear that transformation into a patent-eligible
application requires “more than simply stat[ing] the [abstract idea] while adding the words ‘apply it.’ ” Id., at ___(slip op., at 3).
Mayo itself is instructive. The patents at issue in Mayoclaimed a method for measuring metabolites in the bloodstream in order to calibrate the appropriate dosage ofthiopurine drugs in the treatment of autoimmune diseases. Id., at ___ (slip op., at 4–6). The respondent in thatcase contended that the claimed method was a patenteligible application of natural laws that describe the relationship between the concentration of certain metabolites
and the likelihood that the drug dosage will be harmful orineffective. But methods for determining metabolite levels
were already “well known in the art,” and the process at
issue amounted to “nothing significantly more than an
instruction to doctors to apply the applicable laws whentreating their patients.” Id., at ___ (slip op., at 10).
“Simply appending conventional steps, specified at a highlevel of generality,” was not “enough” to supply an “ ‘inventive concept.’ ” Id., at ___, ___, ___ (slip op., at 14, 8, 3).
The introduction of a computer into the claims does notalter the analysis at Mayo step two. In Benson, for example, we considered a patent that claimed an algorithm
implemented on “a general-purpose digital computer.” 409
U. S., at 64. Because the algorithm was an abstract idea,
see supra, at 8, the claim had to supply a “ ‘new and use-

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Opinion of the Court

ful’ ” application of the idea in order to be patent eligible.
409 U. S., at 67. But the computer implementation did
not supply the necessary inventive concept; the process
could be “carried out in existing computers long in use.”
Ibid. We accordingly “held that simply implementing amathematical principle on a physical machine, namely acomputer, [i]s not a patentable application of that principle.” Mayo, supra, at ___ (slip op., at 16) (citing Benson,supra, at 64).
Flook is to the same effect. There, we examined a computerized method for using a mathematical formula toadjust alarm limits for certain operating conditions (e.g.,temperature and pressure) that could signal inefficiency or
danger in a catalytic conversion process. 437 U. S., at585–586. Once again, the formula itself was an abstract
idea, see supra, at 8, and the computer implementation
was purely conventional. 437 U. S., at 594 (noting thatthe “use of computers for ‘automatic monitoringalarming’ ” was “well known”). In holding that the process
was patent ineligible, we rejected the argument that
“implement[ing] a principle in some specific fashion” will
“automatically fal[l] within the patentable subject matterof §101.” Id., at 593. Thus, “Flook stands for the proposition that the prohibition against patenting abstract ideas
cannot be circumvented by attempting to limit the use of[the idea] to a particular technological environment.”
Bilski, 561 U. S., at 610–611 (internal quotation marks
omitted).
In Diehr, 450 U. S. 175, by contrast, we held that acomputer-implemented process for curing rubber was
patent eligible, but not because it involved a computer.
The claim employed a “well-known” mathematical equation, but it used that equation in a process designed tosolve a technological problem in “conventional industry
practice.” Id., at 177, 178. The invention in Diehr used a“thermocouple” to record constant temperature measure-Cite as: 573 U. S. ____ (2014)13

Opinion of the Court

ments inside the rubber mold—something “the industry
ha[d] not been able to obtain.” Id., at 178, and n. 3. The
temperature measurements were then fed into a computer,which repeatedly recalculated the remaining cure timeby using the mathematical equation. Id., at 178–179.
These additional steps, we recently explained, “transformed the process into an inventive application of theformula.” Mayo, supra, at ___ (slip op., at 12). In otherwords, the claims in Diehr were patent eligible because
they improved an existing technological process, not because they were implemented on a computer.
These cases demonstrate that the mere recitation of ageneric computer cannot transform a patent-ineligible
abstract idea into a patent-eligible invention. Stating an
abstract idea “while adding the words ‘apply it’ ” is notenough for patent eligibility. Mayo, supra, at ___ (slip op.,at 3). Nor is limiting the use of an abstract idea “ ‘to aparticular technological environment.’ ” Bilski, supra, at
610–611. Stating an abstract idea while adding the words“apply it with a computer” simply combines those two
steps, with the same deficient result. Thus, if a patent’s
recitation of a computer amounts to a mere instruction to“implemen[t]” an abstract idea “on . . . a computer,” Mayo,supra, at ___ (slip op., at 16), that addition cannot impartpatent eligibility. This conclusion accords with the preemption concern that undergirds our §101 jurisprudence.
Given the ubiquity of computers, see 717 F. 3d, at 1286
(Lourie, J., concurring), wholly generic computer implementation is not generally the sort of “additional featur[e]”that provides any “practical assurance that the process ismore than a drafting effort designed to monopolize the[abstract idea] itself.” Mayo, 566 U. S., at ___ (slip op., at
8–9).
The fact that a computer “necessarily exist[s] in thephysical, rather than purely conceptual, realm,” Brief for
Petitioner 39, is beside the point. There is no dispute that

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ALICE CORP. v. CLS BANK INT’L
Opinion of the Court

a computer is a tangible system (in §101 terms, a “machine”), or that many computer-implemented claims areformally addressed to patent-eligible subject matter. But
if that were the end of the §101 inquiry, an applicant could
claim any principle of the physical or social sciences byreciting a computer system configured to implement therelevant concept. Such a result would make the determination of patent eligibility “depend simply on the draftsman’s art,” Flook, supra, at 593, thereby eviscerating therule that “ ‘[l]aws of nature, natural phenomena, andabstract ideas are not patentable,’ ” Myriad, 569 U. S., at___ (slip op., at 11).
2
The representative method claim in this case recites thefollowing steps: (1) “creating” shadow records for eachcounterparty to a transaction; (2) “obtaining” start-of-day
balances based on the parties’ real-world accounts at
exchange institutions; (3) “adjusting” the shadow records
as transactions are entered, allowing only those transactions for which the parties have sufficient resources; and(4) issuing irrevocable end-of-day instructions to the exchange institutions to carry out the permitted transactions. See n. 2, supra. Petitioner principally contends thatthe claims are patent eligible because these steps “require
a substantial and meaningful role for the computer.” Brief
for Petitioner 48. As stipulated, the claimed method
requires the use of a computer to create electronic records,
track multiple transactions, and issue simultaneous instructions; in other words, “[t]he computer is itself theintermediary.” Ibid. (emphasis deleted).
In light of the foregoing, see supra, at 11–14, the relevant question is whether the claims here do more thansimply instruct the practitioner to implement the abstract
idea of intermediated settlement on a generic computer.
They do not.

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Opinion of the Court

Taking the claim elements separately, the function
performed by the computer at each step of the process is“[p]urely conventional.” Mayo, supra, at ___ (slip op., at10) (internal quotation marks omitted). Using a computer
to create and maintain “shadow” accounts amounts toelectronic recordkeeping—one of the most basic functionsof a computer. See, e.g., Benson, 409 U. S., at 65 (notingthat a computer “operates . . . upon both new and previously stored data”). The same is true with respect to theuse of a computer to obtain data, adjust account balances,and issue automated instructions; all of these computerfunctions are “well-understood, routine, conventional
activit[ies]” previously known to the industry. Mayo, 566
U. S., at ___ (slip op., at 4). In short, each step does nomore than require a generic computer to perform genericcomputer functions.
Considered “as an ordered combination,” the computercomponents of petitioner’s method “ad[d] nothing . . . thatis not already present when the steps are consideredseparately.” Id., at ___ (slip op., at 10). Viewed as awhole, petitioner’s method claims simply recite the concept
of intermediated settlement as performed by a genericcomputer. See 717 F. 3d, at 1286 (Lourie, J., concurring)(noting that the representative method claim “lacks any
express language to define the computer’s participation”).
The method claims do not, for example, purport to improve
the functioning of the computer itself. See ibid. (“There isno specific or limiting recitation of . . . improved computer
technology . . . ”); Brief for United States as Amicus Curiae
28–30. Nor do they effect an improvement in any othertechnology or technical field. See, e.g., Diehr, 450 U. S., at
177–178. Instead, the claims at issue amount to “nothing
significantly more” than an instruction to apply the abstract idea of intermediated settlement using some unspecified, generic computer. Mayo, 566 U. S., at ___ (slipop., at 10). Under our precedents, that is not “enough” to16

ALICE CORP. v. CLS BANK INT’L
Opinion of the Court

transform an abstract idea into a patent-eligible invention.
Id., at ___ (slip op., at 8).
C
Petitioner’s claims to a computer system and a computerreadable medium fail for substantially the same reasons. Petitioner conceded below that its media claims riseor fall with its method claims. En Banc Response Brief for
Defendant-Appellant in No. 11–1301 (CA Fed.) p. 50, n. 3.
As to its system claims, petitioner emphasizes that thoseclaims recite “specific hardware” configured to perform“specific computerized functions.” Brief for Petitioner 53.
But what petitioner characterizes as specific hardware—a“data processing system” with a “communications controller” and “data storage unit,” for example, see App. 954,
958, 1257—is purely functional and generic. Nearly every
computer will include a “communications controller” and“data storage unit” capable of performing the basic calculation, storage, and transmission functions required by themethod claims. See 717 F. 3d, at 1290 (Lourie, J., concurring). As a result, none of the hardware recited by thesystem claims “offers a meaningful limitation beyond
generally linking ‘the use of the [method] to a particulartechnological environment,’ that is, implementation via
computers.” Id., at 1291 (quoting Bilski, 561 U. S., at
610–611).
Put another way, the system claims are no different
from the method claims in substance. The method claims
recite the abstract idea implemented on a generic computer;the system claims recite a handful of generic computercomponents configured to implement the same idea. This
Court has long “warn[ed] . . . against” interpreting §101“in ways that make patent eligibility ‘depend simply on
the draftsman’s art.’ ” Mayo, supra, at ___ (slip op., at 3)(quoting Flook, 437 U. S., at 593); see id., at 590 (“Theconcept of patentable subject matter under §101 is notCite as: 573 U. S. ____ (2014)17

Opinion of the Court‘like a nose of wax which may be turned and twisted inany direction . . . ’ ”). Holding that the system claims arepatent eligible would have exactly that result.
Because petitioner’s system and media claims add nothing of substance to the underlying abstract idea, we holdthat they too are patent ineligible under §101.
***
For the foregoing reasons, the judgment of the Court ofAppeals for the Federal Circuit is affirmed.
It is so ordered.

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1

SOTOMAYOR, J., concurring

SUPREME COURT OF THE UNITED STATES_________________

No. 13–298_________________ALICE CORPORATION PTY. LTD, PETITIONER v. CLSBANK INTERNATIONAL ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT[June 19, 2014]JUSTICE SOTOMAYOR, with whom JUSTICE GINSBURG
and JUSTICE BREYER join, concurring.
I adhere to the view that any “claim that merely describes a method of doing business does not qualify as a‘process’ under §101.” Bilski v. Kappos, 561 U. S. 593, 614(2010) (Stevens, J., concurring in judgment); see also In re
Bilski, 545 F. 3d 943, 972 (CA Fed. 2008) (Dyk, J., concurring) (“There is no suggestion in any of th[e] early [English] consideration of process patents that processes fororganizing human activity were or ever had been patentable”). As in Bilski, however, I further believe that themethod claims at issue are drawn to an abstract idea. Cf.
561 U. S., at 619 (opinion of Stevens, J.). I therefore join
the opinion of the Court.