Patent Law Practice Center

Bilski v. Kappos: Summary And Implications

 

Written by Andrea M. Augustine (Partner at Foley & Lardner LLP and faculty member for the upcoming PLI Patent Litigation program) and Kevin J. Malaney (Associate at Foley & Lardner LLP)

On June 28, 2010, the U.S. Supreme Court issued its much anticipated opinion in Bilski v. Kappos.  In Bilski, the Court affirmed the judgment of the Court of Appeals for the Federal Circuit, In re Bilski, 545 F.3d 943 (Fed. Cir. 2008) (en banc), that the claims in question did not qualify for patent protection.  In doing so, the Court unanimously rejected the Federal Circuit’s determination that the “machine-or-transformation” test was the exclusive test for “process” patent eligibility.  But instead of establishing what test should be applied in future cases, the Court left this question open and simply relied on previous Supreme Court case law and the Patent Act to hold Applicants’ claims ineligible for patent protection.  Despite the uncertainty regarding the appropriate test, Bilski does provides some guidance as to what “process” claims are eligible for patent protection.  Because of the open questions that remain, future cases will be closely watched and studied for clarification and application of the Court’s holdings.  In the meantime, observers, advocates, and pundits will review the fine details and history of In re Bilski in search of guidance on the future of business method patents and patent applications. (more…)

Patent Office Releases Interim Bilski Guidelines

Written by Gene Quinn (of IPWatchdog.com and Patent Center Contributor)

This morning the United States Patent and Trademark Office published Interim Guidance for Determining Subject Matter Eligibility for Process Claims in View of Bilski v. Kappos. The Interim Bilski Guidance is effective July 27, 2010, and applies to all applications filed before, on or after the effective date. Most noteworthy is that the Patent Office is encouraging examiners to issue 101 rejection in only “extreme cases” and allow patentability to be decided by sections 102, 103 and 112.

These interim guidelines build upon the memo sent to the examining corps the day the Supreme Court issued its decision in Bilski v. Kappos, and is intended for use by Office personnel when determining subject matter eligibility under 35 U.S.C. 101. According to the Federal Register Notice, this guidance supersedes previous guidance on subject matter eligibility that conflicts with the Interim Bilski Guidance.

Significantly, the guidelines explain:

Therefore, examiners should avoid focusing on issues of patent eligibility under Sec. 101 to the detriment of considering an application for compliance with the requirements of Sec. Sec. 102, 103, and 112, and should avoid treating an application solely on the basis of patent eligibility under Sec. 101 except in the most extreme cases.

This should be music to the ears of the patent bar and applicants who were previously stopped dead in their tracks by a seemingly insurmountable 101 rejection. (more…)

Bilski Aftermath: Will Europe’s “Technical Effect” Test Become the Law in the U.S.?

Robert Hulse, of Fenwick & West LLP, Practice Center Contributor and PLI Faculty member, discusses what the future may look like for business method patents:

I think most patent practitioners and applicants who have been following this case believe that we dodged a bullet, as the Court’s decision was about as good as could have been expected.  The Court removed the Federal Circuit’s overly rigid application of the machine-or-transformation (MOT) test as the sole test for patent eligible-subject matter, but it retained the test as a useful indication of whether a claim meets the subject matter requirement.  (In this respect, the Bilski decision is much like the Court’s decision in KSR a few years ago, where the court kept the teaching-suggestion-motivation (TSM) test, but held that it was just one of many useful ways to evaluate a claim for its compliance with the nonobviousness requirement.)  The benefit to applicants is that we can continue to rely on compliance with the MOT test by reciting a machine or transformation, subject to the “post solution activity” and “meaningful limits” considerations, while not being completely constrained by that test.

The Court also declined to exclude business methods from patent-eligible subject matter, although four justices (including Stevens, who is leaving the Court) would have done so.  This means that companies who innovate to create new ways of conducting business can continue to protect their inventions.  Excluding business methods for patent-eligible subject matter would have created more problems than it solved, not the least of which would have been how to define a “business method.” (more…)

Supreme Court Rules that Business Methods May be Patentable

Guest Post by Trevor Carter (partner at  Baker & Daniels ,Practice Center Contributor and PLI Faculty Member) and Daniel M. Lechleiter ( associate at Baker & Daniels)

On June 28, 2010, the U.S. Supreme Court decided Bilski v. Kappos, an important case involving whether patent claims directed to so-called “business methods” are patentable under U.S. patent law.  The case involved a patent application that claimed a method of hedging against the risk of price changes in the energy market.  The claims described a series of steps instructing how to hedge risk, as well as the same concept embodied in a mathematical formula.  The U.S. Patent Office and all of the lower courts rejected the application as unpatentable, and, because it found that the claims pertain to an “abstract idea,” the Supreme Court agreed.

But, far short of providing clear guidance on how to determine whether a given business method is patentable, the Supreme Court provided high level guidance and left future case by case determinations to lower courts.  Thus, while the case makes clear that certain business methods can be patentable, with the exception of very general guidance found in the Patent Act and three of the Court’s prior decisions, it leaves wide open the question of how to distinguish patent-eligible business methods from ineligible ones.  This will undoubtedly lead to further litigation and legal experimentation in the lower courts, as they attempt to determine how and where to draw the line between patentable and unpatentable business methods. (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…)