On the last day of their sitting, the United States Supreme Court issued the long-waited Re Bilksi decision.
Essentially, Mr Bilski tried to get a patent for hedging, particularly as applied to energy resources. The examiner, the USPTO on Appeal, the Court and the Federal Circuit Court of Appeal (en banc) all held that the invention claimed was not patentable subject matter.
Many observers, including myself, were somewhat surprised that the Supreme Court, which hears maybe one patent case a year, decided to hear this one.
The possible ramifications were wider than Bilski. We wondered whether business method patents per se. – which issued in the US in large numbers over the last decade would be voided or upheld; would software per se. be patentable or would it require to be tied to a particular machine? What about gene sequences and other biological discoveries that arguably were not inventions, and could not fairly be described as processes, new matter, machines, etc.
In the event, perhaps wisely, the decision was to uphold the invalidity of the specific Bilksi business patent as being an abstract idea or not a process, and therefore outside the scope of patentable inventions. The Federal Circuit’s attempt to tie patentable subject matter to technological areas (Meyer) or to the machine or material transformation test was, however rejected. The transformation test remains a useful symptom of patentability but is not axiomatic. It is not in the US Constitution or in the Patent Law, nor is a technological requirement. These indications of patentability are helpful but not sufficient.
Since business method patents are still allowable per se. Those allowed until now have a presumption of validity, but one would be wary to sue others based on them since there is every likelihood that they would be invalidated by the court. Indeed, with a 40% reversal rate on appeal in the US, the presumption of validity is not strong anyway.
Patent attorneys like myself who cannot understand when to consider an applied method is to be considered an abstract thought and when it is a process will have to tell applicants that the issue is not yet resolved, try to discourage them from filing, and then, since we are professionals in an intellectual version of the oldest profession, simply pocket our fees and try our best.
The case was the wrong to hear and the judges declined to say anything of substance. There were a few interesting facts, like a pre 1790 patent in the UK for a business method, but long-awaited decision actually clarified very little.
Congress should now amend the Patent Law and introduce definitions. Patentability is, afer all, a matter of policy. Oddities like grace periods and first to invent could be scrapped.
One good way to adopt a fairly sensible system would be to adopt the European Patent Convention. Can’t see it happening…
Many of the arguments used in Israeli decisions and patent office circulars were rejected by the US Supreme Court that saw itself as not being authorized to add terminology into the Law. I am not sure that business patents or software per se. which the Israel Patent Office considers not patentable subject matter should not be. Nor am I convinced that gene sequences are not better understood as discoveries than inventions.
The trouble is, of course, that the commissioner of Patents, possibly does n’t have the authority to do what he does, but despite arguably lacking legal competence, he is professionally competent. The courts here are not. Nor, from some of their arguments, are the justices in the US.
The 71 page decision was worth reading. Some paragraphs were even somewhat amusing (in a dry academic sort of way). Does it ellucidate much? No. Worth waiting for? Hardly.
Posted by Michael Factor 
