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BACK TO BUSINESS METHODS AS USUAL: BILSKI v. KAPPOS

June 28, 2010
by Seema Mehta, Patent Attorney and Aly Dossa, Patent Attorney

Today, the Supreme Court issued its long-awaited opinion in the matter of Bilski v. Kappos. In short, the claimed invention at the center of the case was found to be an abstract idea, which is patent ineligible. This result is not surprising. However, what is surprising is that the Court reinforced that software and business methods continue to be patent eligible.

In reaching its conclusion, the Court focused on what constitutes patent eligible subject matter under 35 U.S.C. § 101 and, in particular, what constitutes a patent eligible "process" under 35 U.S.C. § 101. At the outset, the Court stated that the "machine or transformation test" previously articulated by the Federal Circuit is not the only test by which patent eligible subject matter may be determined. Rather, the "machine or transformation" test represents an "important clue" as to whether the subject matter is patent eligible, and can continue to be used to help determine whether claimed subject matter is patent eligible. See Bilski v. Kappos, 561 U.S. ___ (2010) (slip op., at page 8). The Court subsequently articulated other tests, such as those set forth in Benson, Flook, and Diehr, that may be used to determine patent eligibility under 35 U.S.C. § 101.

Finally, in addressing the issue of "business methods," the Court concluded that business methods are not categorically excluded from patentability. See Bilski v. Kappos, 561 U.S. ___ (2010) (slip op., at 10-11). To the contrary, a business method can be patentable eligible so long as it is not merely abstract in nature.

Practical Result

Software and business method inventions may continue to be patent eligible as computer readable instructions stored on a computer readable medium and as software instructions configured to be executed by a processor in a computer system. More importantly, following the Court's decision, software and business method inventions are patent eligible as "processes" or "methods" provided that at least one of the tests outlined in the Court's decision is satisfied. We note that while the Court made it clear that there is no "single" test to determine patent eligibility, without further guidance from Congress or the Judicial Branch, it seems clear that "processes" satisfying tests set forth in decision will satisfy 35 U.S.C. § 101. Only time will tell whether additional tests may also be used to determine whether a given "process" satisfies 35 U.S.C. § 101. Finally, it is important to note that while this decision focused on a business method, the reasoning articulated by the Court extends to all "processes."

To view the full opinion, please click here.
 

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