Yesterday's long-awaited Bilski v. Kappos holding was rather anticlimactic, in that it provided no new guidelines on whether a particular invention would be patentable under 35 USC § 101. While some had feared that the decision in Bilski may invalidate business method patents altogether, while others expected that the Supreme Court would at least provide clarity to the patentability rules for business methods, the Court instead decided to limit its holding solely to the invention at issue:
It is important to emphasize that the Court today is not commenting on the patentability of any particular invention, let alone holding that any of the above-mentioned technologies from the Information Age should or should not receive patent protection. This age puts the possibility of innovation in the hands of more people and raises new difficulties for the patent law. With ever more people trying to innovate and thus seeking patent protections for their inventions, the patent law faces a great challenge in striking the balance between protecting inventors and not granting monopolies over procedures that others would discover by independent, creative application of general principles. Nothing in this opinion should be read to take a position on where that balance ought to be struck.
The Court did decide that Bilski's risk-hedging method was unpatentable, due to the concept being an abstract idea:
The concept of hedging, described in claim 1 and reduced to a mathematical formula in claim 4, is an unpatentable abstract idea, just like the algorithms at issue in Benson and Flook. Allowing petitioners to patent risk hedging would preempt use of this approach in all fields, and would effectively grant a monopoly over an abstract idea.
However, in reaffirming the Federal Circuit's ruling that Bilski's method was unpatentable, the Supreme Court effectively rejected the Federal Circuit's machine-or-transformation standard as the sole test by which to determine the patentability of a process, electing instead to rely on the precedential cases of Parker v. Flook, Gottschalk v. Benson, and Diamond v. Diehr:
Today, the Court once again declines to impose limitations on the Patent Act that are inconsistent with the Act's text. The patent application here can be rejected under our precedents on the unpatentability of abstract ideas. The Court, therefore, need not define further what constitutes a patentable "process," beyond pointing to the definition of that term provided in §100(b) and looking to the guideposts in Benson, Flook, and Diehr. And nothing in today's opinion should be read as endorsing interpretations of §101 that the Court of Appeals for the Federal Circuit has used in the past. See, e.g., State Street, 149 F. 3d, at 1373; AT&T Corp., 172 F. 3d, at 1357. It may be that the Court of Appeals thought it needed to make the machine-or-transformation test exclusive precisely because its case law had not adequately identified less extreme means of restricting business method patents, including (but not limited to) application of our opinions in Benson, Flook, and Diehr. In disapproving an exclusive machine-or-transformation test, we by no means foreclose the Federal Circuit's development of other limiting criteria that further the purposes of the Patent Act and are not inconsistent with its text. The judgment of the Court of Appeals is affirmed.
Thus, while certain business method patents and computer-implemented process claims are likely to remain patentable subject matter as far as the USPTO is concerned, the Supreme Court, in this ruling, has effectively directed the Federal Circuit to apply the Benson-Flook-Diehr line of precedent to redevelop a doctrine of patentable subject matter beyond the machine-or-transformation test, and it is likely that we will see the issue relitigated in the years to come.
Stay tuned for further analysis of the Bilski decision and its implications in the coming days.
Leave a comment