Bilski’s Impact on Finance Industry Patents

The following was written by Dale Lazar (Partner at DLA Piper and one of our newest Practice Center Contributor’s)  and Jim Heintz (Partner at DLA Piper).

When the Supreme Court announced it would hear the Bilski case, many speculated that the Court would use the opportunity to declare an end to patents on business methods. This did not happen. However, the Court did find that Bilski’s claims to a method for hedging risk were not the kind of invention for which a patent should be granted.

What does this mean for other finance industry patents and patent applications? Certain types of business method patents may be safe for now – but warning signs point to hazards down the road.

Most would agree that the claims of Bilski’s patent application are directed toward a business method. Two aspects of the Supreme Court’s Bilski decision are particularly important to the issue of whether finance industry inventions can be protected by patents: (1) business methods are not categorically excluded from patent protection; but (2) Bilski’s claims to methods for hedging risk are unpatentable because they claim an “abstract idea.” (more…)

BILSKI: Where Do We Go From Here?

The following guest post comes from  Kenneth Nigon, Practice Manager for the Patent Preparation and Prosecution Group at RatnerPrestia and PLI Faculty member.

On Tuesday, July 27, the USPTO published its Interim Guidance for Determining Subject Matter Eligibility for Process Claims in view of Bilski v. Kappos (“Interim Bilski Guidance”).  This Guidance supplements the Interim Examination Instructions for Evaluating Subject Matter Eligibility Under 35 U.S.C. § 101 (“Interim Instructions”), published on August 24, 2009 and the memorandum to the Patent Examining Corps on the Supreme Court Decision in Bilski v Kappos published on June 28, 2010 (“Bilski Memorandum”).

The Bilski Memorandum instructs the examiners to reject method claims that do not meet the requirements of the Machine or Transformation (MoT) test formulated by the Federal Circuit in In re Bilski 545 F.3d 943 (Fed. Cir. 2008).  The Interim Bilski Guidance modifies these instructions to require examiners to apply a balancing test which weighs factors both in favor of and opposed to patent eligibility and directs examiners to consider all requirements for patentability in the interest of compact prosecution.

The factors weighing in favor of eligibility of a claim include that it:

  • passes the MoT test,
  • is directed toward the application of a law of nature and
  • is more than a mere statement of a concept. (more…)

Bilski Decision: No Concrete Guidance On Test For Determining Patentability of Processes

Many of us are still trying to digest yesterday’s Supreme Court decision on the Bilski v. Kappos case and will most certainly be reading and re-reading the opinion many times before drawing any conclusions.  It will be interesting to see how the various players in the patent community interpret the decision and what they believe will be the significance of the ruling.  I reached out to several of the Practice Center Contributor’s asking them to weigh in on the decision.  Here is what Jeanne M. Gills, Vice Chair, IP Department  at Foley and Lardner had to say….

The Supreme Court’s ruling is fairly narrow.  The Court merely affirmed the finding of unpatentability because the Bilski invention was viewed as abstract ideas.  It was widely viewed that the particular Bilski invention was unpatentable, so that affirmance was not surprising.  Also, I believe many believed that the Supreme Court would not find that business methods were categorically unpatentable (since some business methods could be patentable provided they meant certain criteria).  (While this was a close and split (5-4) decision, I do think that this was the right result, and the alternative could have put some issued patents in jeopardy.)  What the decision fails to do is offer more concrete guidance as to what constitutes an appropriate test for determining patentability of processes.  By rejecting the “machine or transformation” test as the sole or exclusive test, this leaves the door ajar for other tests to be fashioned.  I do not think it is sufficient to say that any test that is consistent with the patent statutory language offers much guidance.  Hence, the Supreme Court gave the lower courts and the Federal Circuit flexibility to devise other tests or criteria for evaluating the patentability of processes in general and business methods in particular. (more…)

Bilski v. Kappos: A Recap Before Decision Day


As the entire patent community waits with bated breath for the Bilski decision, it seems like the perfect time to recap the course of events that have brought us here.  Yesterday, IPWatchdog had a guest blogger, Robert M. Suarez, who did just that in his article, “Mr. Bilski Goes to Washington: An Abridged Guide.”  It is an excellent summary of the Bilski case.  

Before he offers his guide to the case, Suarez writes, “For all of the opinions, articles, and conjecture, all one need do is study the law and look at the precedents to know that anticipating how the Supreme Court will rule in a case is akin to trying to gaze into a crystal ball. So, what will be the future of business methods as patent-eligible subject matter? Will the machine-or-transformation test stand? What will be the fate of the Bilski patent? An educated guess is the best that one can hope for in this situation.” 

Well said Suarez!! (more…)