Bilski: What’s at Stake, Part 4

This series discusses the recent appeal to the Supreme Court of In re Bilski, 545 F.3d 943 (Fed. Cir. 2008), cert. granted, 129 S.Ct. 2735 (2009). Bilski raises the issue of what constitutes a patentable process under 35 U.S.C. § 101.

Part 4: How the Supreme Court Should Rule

While the machine-or-transformation test may be one useful way to determine whether a patent application recites claims for a patent-eligible process, the Supreme Court should hold that this is not the exclusive test. Instead, the Court should affirm the rule from Diamond v. Diehr, 450 U.S. 175 (1981), that any “process” is patent-eligible under § 101 unless it claims “laws of nature, natural phenomena, [or] abstract ideas.” Furthermore, even if a process does claim a fundamental principle, it may be patent-eligible under § 101 if it claims a “practical application” of a fundamental principle. However, beyond this formulation, the Court should refrain from adopting one particular test to determine whether something is a “process” within the meaning of § 101 for three main reasons.

First, the proper statutory construction of § 101 does not support the machine-or-transformation test as the exclusive test for processes. Congress intended for the categories of patent-eligible subject matter listed in § 101 to be broadly construed. Therefore, since § 101 expressly states that patents may be granted for “any new and useful process,” it is unlikely that Congress intended for this to mean that only certain types of processes are patent-eligible, while others are not. Also, none of the other three categories of patent-eligible subject matter in § 101 have been similarly limited in the way that the Federal Circuit limited the term “process” in Bilski.

Second, the Court should refrain from imposing a restrictive test under § 101 since this is merely the threshold inquiry for assessing patent-eligibility. As Judge Rader emphasized in his dissent in the Federal Circuit opinion, Congress intended for the categories of patent-eligible subject matter in § 101 to be broad. According to Judge Rader, “the Patent Act from its inception focused patentability on the specific characteristics of the claimed invention—its novelty and utility—not on its particular subject matter category.” In other words, the Patent Act provides a multi-step inquiry for determining patent-eligibility, which goes well beyond § 101. Thus, whether the patent claims patent-eligible subject matter is simply the first step, which Congress intended to encompass a broad range of subject matter. Accordingly, the Court should be reluctant to place limits on the broad categories of patent-eligible subject matter provided by Congress in § 101 because later inquiries, such as obviousness and novelty, function as filters for preventing frivolous patents.

Finally, the Court should hold that, contrary to what the Federal Circuit stated below, the “useful, concrete, and tangible results” test associated with State Street Bank may still be used to assess the patentability of processes. A big concern with the Federal Circuit’s decision is that it failed to consider the reasonable expectations of patent owners who relied on State Street Bank precedent when it rejected the “useful, concrete, and tangible results” test. In the wake of the Bilski decision, inventors who drafted their process claims to ensure that they comported with the State Street Bank test may now find that their patents no longer claim patent-eligible subject matter, despite the fact that their claims are otherwise valid according to the standard set out in Diehr. Not only is this troubling for the patent owners who relied on this precedent in drafting their claims, but also it creates an undue burden on the Patent Office and the courts. This seems particularly unfair considering the fact that Congress implicitly recognized its support for the State Street Bank case when it enacted § 273, and for over ten years, the Federal Circuit had applied the “useful, concrete, and tangible results” test. Therefore, the Court should hold that although courts may look to tests such as the machine-or-transformation test or the State Street Bank test for guidance, ultimately, the proper inquiry is always whether the process claims a fundamental principle.

Previous Parts:

Part 1: Background and the Federal Circuit’s Decision

Part 2: A Brief Overview of Petitioner’s Arguments

Part 3: A Brief Overview of Respondent’s Arguments