Anticipate This!™ | Patent and Trademark Law Blog

Bilski v. Kappos.

Posted in Opinion Commentary by Jake Ward on July 1, 2010

 The machine-or-transformation test is not the sole test for patent eligibility under §101. 

(Supreme Court 2009, 08-964)

As stated by Justice Kennedy in the opinion of the Court, the question in this case turned on whether a patent can be issued for a claimed invention designed for the business world. The Bilski patent application claimed a procedure for instructing buyers and sellers how to protect against the risk of price fluctuations in a discrete section of the economy.

35 U.S.C. 101 specifies that “[w]hoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title”.  Supreme Court precedents provide three specific exceptions to §101’s broad principles, namely that “laws of nature, physical phenomena, and abstract ideas” are not patent-eligible subject matter.

The USPTO Examiner had earlier rejected Bilski’s claims as “not directed to the technological arts”. Upon appeal to the Board of Patent Appeals and Intereferences (BPAI), the BPAI affirmed on the grounds that the application involved only mental steps that do not transform physical matter and was directed to an abstract idea. The Court of Appeals for the Federal Circuit (CAFC) heard the case, and affirmed the decisions of the Examiner and the BPAI. However, the CAFC went further to rule that the “machine-or-transformation test” was the sole test to be used for determining the patentability of a “process” under the Patent Act, 35 U. S. C. §101.

In the opinion, the Supreme Court affirmed the decisions of the USPTO and lower courts, which held that the Bilski invention was not patent-eligible subject matter. In particular, the Court found that the Bilski invention is an unpatentable “abstract idea”.

The Supreme Court disagreed with the CAFC’s adoption of the machine-or-transformation test as the sole test for what constitutes a “process”, however.   The Supreme Court ruled that the machine-or-transformation test is just an important and useful clue in determining whether an invention is patent-eligible subject matter.  Thus, the Court’s guidepost precedents in the patent cases of Benson, Flook, and Diehr , which affirm that “laws of nature, physical phenomena, and abstract ideas” are exceptions to the patentable subject matter requirements of §101, should broadly control any inquiry as to whether an invention is patent-eligible subject matter.

Of particular interest to patent practitioners is that the opinion holds that a business method is simply one kind of “method” that is, at least in some circumstances, eligible for patenting under §101.  Business methods cannot be categorically excluded as patent-eligible subject matter under §101.  This contrasts starkly with the position taken by Justice Stevens in his lengthy concurrence (a dissent of sorts), which would have held that a series of steps for conducting business is not, in itself, patentable subject matter.

AFFIRMED.

JW Note: There are many other Bilski summaries available at your local patent blogs, which delve more into the analysis of this important case. However, the take-home from my reading is fairly simple: 1) business methods are patentable; 2) laws of nature, physical phenomena, and abstract ideas are not patentable (duh); and 3) the machine-or-transformation test can still be used, but only as a “guide” for determining patent-eligibility of an invention.

In fact, 3) appears to already have been implemented into USPTO practices, as evidenced by this memo promulgated to the Examining Corps shortly after the Bilski decision issued.    The memo acknowledges that even if the machine-or-transformation is satisfied, it can be rebutted by establishing that the invention does not fall into one of the excluded categories of 2).  In my opinion, this was a good decision by the Supreme Court, and certainly a workable outcome for applicants and patent practitioners!

Bilski Decision Issued by SCOTUS Today – June 28, 2010.

Posted in Opinion Commentary by Jake Ward on June 28, 2010

JMW Note: Currently delayed at Reagan National, on the way back to Ohio after a long day of examiner interviews. Analysis and thoughts on Bilski to follow this week!

Bilski Decision Tomorrow (Thursday, June 17th)? Maybe?

Posted in Practice Commentary by Jake Ward on June 16, 2010

JW Update 06/24/10 @ 10:31AM:  No Bilski for you!  At least, not today.  Looking forward to Monday, 6/28, where the last four decisions of the term (including Bilski) are likely to be published.  On another note, be sure to check out www.scotusblog.com on the morning of the opinion.  My favorite comment from their live blog this morning:  “10:21 Tom: The Court has voted unanimously to drive patent lawyers crazy.”

JW Update 06/21/10 @ 10:28AM:  Nothing again today!  Maybe this Thursday (06/24) or next Monday (06/28)!  A tip for other Bilski-watchers out there . . . check out www.scotusblog.com on the mornings that SCOTUS decisions are released.  They have an awesome “Live Blog window” that provides live updates as the decisions are released, without the need for refereshing the browser.  Pretty cool.

JW Update 06/17/10 @ 10:20AM:  Or maybe NOT.  No Bilski decision today, folks.  Maybe next week! 

In mid-May until the end of June, the Supreme Court of the United States (SCOTUS) releases orders and opinions.  SCOTUS has yet to issue a number of decisions this term, however, and it is rapidly moving toward summer recess.  Most notable from a patent law perspective is that the decision in Bilski v. Kappos, which was argued in November 2009, has yet to be decided. 

As a reminder for those who have been out-of-the-loop for the past several months, the questions presented in the petition for U.S. Supreme Court review in Bilski, and which have the patent law community on pins and needles, were as follows:

1. Whether the Federal Circuit erred by holding that a “process” must be tied to a particular machine or apparatus, or transform a particular article into a different state or thing (“machine-or-transformation” test), to be eligible for patenting under 35 U.S.C. § 101, despite this Court’s precedent declining to limit the broad statutory grant of patent eligibility for “any” new and useful process beyond excluding patents for “laws of nature, physical phenomena, and abstract ideas.”

2. Whether the Federal Circuit’s “machine-or-transformation” test for patent eligibility, which effectively forecloses meaningful patent protection to many business methods, contradicts the clear Congressional intent that patents protect “method[s] of doing or conducting business.” 35 U.S.C. § 273.

Notably, and as reported by the Scotus Blog here, the Supreme Court has announced that it may have some opinions ready to be released tomorrow, June 17th, at 10:00AM.  Maybe we’ll finally have the Bilski decision tomorrow? Any bets?

Bilski-Hitler Satirical Video.

Posted in General Commentary by Jake Ward on November 18, 2009

JW Note:  Hat-tips to Zura’s 271 Blog and IPBIZ.  Hilarious spoof on Youtube related to the ongoing Bilski v. Kappos case being considered at the SCOTUS.  Apparently some patent attorney has had way too much time on his hands.  Enjoy! 

 

 

“Patentable Subject Matter After the Bilski Oral Argument” Webcast – November 19, 2009.

Posted in General Commentary by Jake Ward on November 12, 2009

The American University, Washington College of Law (WCL) is cosponsoring a program on November 19, 2009, titled “Patentable Subject Matter After the Bilski Oral Argument”.  Per the WCL website:

A Telecast by the Program on Information Justice and Intellectual Property, Washington College of Law, American University and the Federal Circuit Bar Association

November 19, 2009, 4:30-6:30 pm
Washington College of Law, Room 603

In Bilski v. Kappos, the U.S. Supreme Court will address limitations on patentable subject matter in the context of a business method invention, analyzing a body of case law in such a way that some say could wrongly call into question the validity of many other patents and types of claims, while others argue it is not restrictive enough. The oral argument – and the subsequent decision – will be studied by a broad range of members of the patent community who are seeking to determine its effects on innovation, prosecution, licensing, and litigation. PIJIP and the FCBA will host a panel of experts to discuss the case shortly after the Court hears the oral argument.
 
The panelists for this program include: Raymond T. Chen, Solicitor, U.S. Patent and Trademark Office, Counsel for Respondent, J. Michael Jakes, Finnegan Henderson, Counsel of Record for Petitioners, Nancy Linck, Rothwell, Figg, Counsel for Amicus Curiae BIO, and Randolph Moss, WilmerHale, Counsel for Amici Curiae Bank of America et al. A period for questions will follow. Thomas C. Goldstein, Akin, Gump, Counsel for Amicus Curiae American Bar Association and Professor Joshua Sarnoff, Washington College of Law, American University, Counsel for Amici Eleven Law Professors and the AARP will moderate.
 
In addition to on-site attendance, the FCBA will also broadcast the program live via the web on November 19, 2009 as a part of its regular Horizons series.    

This likely will be an excellent panel discussion of the recent oral arguments in Bilski v. Kappos.  More information on the program, and details how to participate, may be found here.

Bilski v. Kappos: Notable Quotes from the Oral Arguments.

Posted in Litigation Commentary by Jake Ward on November 9, 2009

The link to the transcript for the November 9th oral arguments before the SCOTUS in Bilski v. Kappos can be found here.

Per usual, we will preface our thoughts with the following disclaimer:  “It is generally a futile effort to predict how the Supreme Court will rule on any given issue.”  That being said, below are some quotes that we found of particular interest:

(more…)

Scheduled SCOTUS Oral Arguments in Bilski v. Kappos – November 9, 2009.

Posted in Litigation Commentary by Jake Ward on November 9, 2009

Oral arguments in Bilski v. Kappos are scheduled for today, November 9, 2009.  Previous AT! coverage of Bilski here, here, here, and here.

In short, the CAFC in Bilski has held that business methods are not patentable unless they satisfy the machine-or-transformation test.  In other words, patentable business methods must either: 1) transform matter into a different state or thing, or 2) be tied to particular machine.  The Bilski decision expressly held inadequate the 1998 ruling in State Street Bank, which had established that business methods were patentable if they produced a “useful, concrete, and tangible result”. 

The questions presented in the petition for U.S. Supreme Court review were:

1. Whether the Federal Circuit erred by holding that a “process” must be tied to a particular machine or apparatus, or transform a particular article into a different state or thing (“machine-or-transformation” test), to be eligible for patenting under 35 U.S.C. § 101, despite this Court’s precedent declining to limit the broad statutory grant of patent eligibility for “any” new and useful process beyond excluding patents for “laws of nature, physical phenomena, and abstract ideas.”

2. Whether the Federal Circuit’s “machine-or-transformation” test for patent eligibility, which effectively forecloses meaningful patent protection to many business methods, contradicts the clear Congressional intent that patents protect “method[s] of doing or conducting business.” 35 U.S.C. § 273.

Further details on Bilski v. Kappos may be found via the SCOTUS  Wiki here.  A transcript of the oral arguments will follow, as soon as available.

SCOTUS Grants Cert in Bilski.

Posted in Practice Commentary by Jake Ward on June 1, 2009

The United States Supreme Court granted certiorari today (courtesy of SCOTUS Blog) in the case Bilski v. Doll. See previous AT! coverage of Bilski here, here, and here.

In short, the CAFC in Bilski has held that business methods are not patentable unless they satisfy the machine-or-transformation test.  In other words, patentable business methods must either: 1) transform matter into a different state or thing, or 2) be tied to particular machine.  The Bilski decision expressly held inadequate the 1998 ruling in State Street Bank, which had established that business methods were patentable if they produced a “useful, concrete, and tangible result”. 

The questions presented in the petition for U.S. Supreme Court review were:

1. Whether the Federal Circuit erred by holding that a “process” must be tied to a particular machine or apparatus, or transform a particular article into a different state or thing (“machine-or-transformation” test), to be eligible for patenting under 35 U.S.C. § 101, despite this Court’s precedent declining to limit the broad statutory grant of patent eligibility for “any” new and useful process beyond excluding patents for “laws of nature, physical phenomena, and abstract ideas.”

2. Whether the Federal Circuit’s “machine-or-transformation” test for patent eligibility, which effectively forecloses meaningful patent protection to many business methods, contradicts the clear Congressional intent that patents protect “method[s] of doing or conducting business.” 35 U.S.C. § 273.

Now the the SCOTUS has granted cert in Bilski, will business methods as patentable subject matter survive?  Any thoughts from our readers?

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