In re Bilski: Patentable Process Must Either (1) be Tied to a particular machine or (2) Transform a Particular Article

In re Bilski, __ F.3d __ (Fed. Cir. 2008)(en banc)

The Federal Circuit has affirmed the PTO’s Board of Patent Appeals (BPAI) finding that Bilski’s claimed invention (a method of hedging risks in commodities trading) does not satisfy the patentable subject matter requirements of 35 U.S.C. § 101. In doing so, the nine-member majority opinion (penned by Chief Judge Michel) spelled out the “machine-or-transformation” test as the sole test of subject matter eligibility for a claimed process.

The Supreme Court … has enunciated a definitive test to determine whether a process claim is tailored narrowly enough to encompass only a particular application of a fundamental principle rather than to pre-empt the principle itself. A claimed process is surely patent-eligible under § 101 if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing.

….

Because the applicable test to determine whether a claim is drawn to a patent-eligible process under § 101 is the machine-or-transformation test set forth by the Supreme Court and clarified herein, and Applicants’ claim here plainly fails that test, the decision of the Board is AFFIRMED.

State Street Test Is Out: In State Street, the Federal Circuit used the “useful, concrete, and tangible result” of a process as a touchstone for patentability. In Bilski, the en banc panel found the State Street formulation “insufficient to determine whether a claim is patent-eligible under § 101.”

[W]e also conclude that the “useful, concrete and tangible result” inquiry is inadequate and reaffirm that the machine-or-transformation test outlined by the Supreme Court is the proper test to apply.

Some Business Methods and Software Are Still In: Still, the court made clear that business methods and Software will still be patentable – if they meet the machine-or-transformation test.

We rejected [a categorical] exclusion in State Street, noting that the so-called “business method exception” was unlawful and that business method claims (and indeed all process claims) are “subject to the same legal requirements for patentability as applied to any other process or method.” We reaffirm this conclusion.

[A]lthough invited to do so by several amici, we [also] decline to adopt a broad exclusion over software or any other such category of subject matter beyond the exclusion of claims drawn to fundamental principles set forth by the Supreme Court

To be clear, the machine-or-transformation test is not a physicality test – i.e., a claim can still be patentable even if it does not recite sufficient “physical steps.” On the flip-side, “a claim that recites ‘physical steps’ but neither recites a particular machine or apparatus, nor transforms any article into a different state or thing, is not drawn to patent-eligible subject matter.” Here, the court spelled out the specific issue in mind: a claimed process where every step may be performed entirely in the human mind. In that situation, the machine-or-transformation test would lead to unpatentability. “Of course, a claimed process wherein all of the process steps may be performed entirely in the human mind is obviously not tied to any machine and does not transform any article into a different state or thing. As a result, it would not be patent-eligible under § 101.”

Along this line, the court also dispelled two rising concerns, noting that that (1) neither novelty nor obviousness have any relevance to the section 101 inquiry, and (2) the fact that an individual claim element is – standing alone – patent ineligible does not render the claim unpatentable because patent eligibility is considered while examining the claim as a whole.

What is a Transformation?: The courts have already developed an understanding of transformation as it relates to the Section 101 inquiry. Here, the Federal Circuit referred to the distinction made in the 1982 Abele case. There, the court distinguished between two of Abele’s claims – finding only one patentable. The unpatentable claim recited “a process of graphically displaying variances of data from average values” without specifying “any particular type or nature of data … or from where the data was obtained or what the data represented.” The patentable dependent claim identified the “data [as] X-ray attenuation data produced in a two dimensional field by a computed tomography scanner.” In retrospect, the Federal Circuit sees the difference between these two claims to be that of transformation. The second claim included sufficiently specific transformation because it changed “raw data into a particular visual depiction of a physical object on a display.” Notably, the transformation did not require any underlying physical object. As the court noted later in the opinion, the transformed articles must be “physical objects or substances [or] representative of physical objects or substances.”

The Bilski claims themselves were not seen as transforming an article:

Purported transformations or manipulations simply of public or private legal obligations or relationships, business risks, or other such abstractions cannot meet the test because they are not physical objects or substances, and they are not representative of physical objects or substances. Applicants’ process at most incorporates only such ineligible transformations. . . . As discussed earlier, the process as claimed encompasses the exchange of only options, which are simply legal rights to purchase some commodity at a given price in a given time period. The claim only refers to “transactions” involving the exchange of these legal rights at a “fixed rate corresponding to a risk position.” Thus, claim 1 does not involve the transformation of any physical object or substance, or an electronic signal representative of any physical object or substance.

The principle behind the test is to prevent a patentee from obtaining claims that preempt the use of fundamental principles. That principle reaches back more than 150 years to the Morse case where the inventor was precluded from claiming all uses of electromagnetism to print characters at a distance.

We believe this is faithful to the concern the Supreme Court articulated as the basis for the machine-or-transformation test, namely the prevention of pre-emption of fundamental principles. So long as the claimed process is limited to a practical application of a fundamental principle to transform specific data, and the claim is limited to a visual depiction that represents specific physical objects or substances, there is no danger that the scope of the claim would wholly pre-empt all uses of the principle.

What is a “Particular Machine”?: For software and business methods, the question will remain as to whether a general purpose computer is sufficiently particular to qualify as a “particular machine.” “We leave to future cases the elaboration of the precise contours of machine implementation, as well as the answers to particular questions, such as whether or when recitation of a computer suffices to tie a process claim to a particular machine.” As Professor Duffy noted in an earlier Patently-O article, the PTO Board of Patent Appeals (BPAI) has already answered this question: “A general purpose computer is not a particular machine, and thus innovative software processes are unpatentable if they are tied only to a general purpose computer.” See Ex parte Langemyr (May 28, 2008) and Ex parte Wasynczuk (June 2, 2008). More commonly, the claim may tie the software to computer memory or a processor – is that sufficiently particular? I suspect this fact pattern will arise shortly.

Unpatentability Affirmed

Notes:

  • Although three dissenting opinions were filed, Judge Newman is the only judge who found patentable subject matter in Bilski’s claim.
  • In Dissent, Judge Mayer thought the decision did not go far enough: “Affording patent protection to business methods lacks constitutional and statutory support, serves to hinder rather than promote innovation and usurps that which rightfully belongs in the public domain.” Citing work by Professors Dreyfuss and Pollack, Mayer argues that business method patents have the overall effect of stifling innovation by restricting competition.
  • In his Dissent, Judge Rader asks the insightful question of why a new test is necessary when settled law already answers the question. Rader would have decided the opinion with one line: “Because Bilski claims merely an abstract idea, this court affirms the Board’s rejection.” I believe Rader’s position is quite defensible. In particular, the majority justifies its need for the test as a way to ensure that we avoid the “preemption of fundamental principles.” In the majority construct, the machine-or-transformation test serves as a fairly accurate proxy for preventing preemption. The court does not, however, answer why any proxy is necessary – if the purpose is to exclude overbroad abstract ideas why not simply rely on the current rule preventing patenting of abstract ideas (as well as the law requiring full enablement)?

Concurring opinion by Judge DYK (joined by Judge LINN) attempt to reconcile the history of the patent system with the new rule of patentability.

133 thoughts on “In re Bilski: Patentable Process Must Either (1) be Tied to a particular machine or (2) Transform a Particular Article

  1. “The software hysteria people tend to read the Abstract of a Patent and then scream bloody murder. Attoneys try to argue the invention and never look at the claims they are prosecuting.”

    You haven’t seen the BPAI decisions based upon Bilski then?

    Server? Non-statutory
    Software? Non-statutory
    CD-ROM (i.e., computer readable medium)? Non-statutory

    Someone made an astute comment some time again, and I’m paraphrasing: “claim a CD-ROM by itself, and it is OK, but claim a CD-ROM encoded with instructions to perform a process that does not meet the machine/transformation test, then not OK”

  2. While many are heralding this as the end of software patents or business method patents, I think they are overstating the case.

    As the court noted, the CLAIMS in this particular case merely recited a series of business relationships – a right to exercise legal options (using coal pricing options as an example).

    Yes, writing a claim to something that you can legally do already is not patentable.

    You know, it is funny, but people never read the CLAIMS anymore, only the dicta.

    The software hysteria people tend to read the Abstract of a Patent and then scream bloody murder. Attoneys try to argue the invention and never look at the claims they are prosecuting.

    “The CLAIMS the thing!” to paraphrase Shakespere.

    In one of the footnotes, the court expressly stated that they were not going to take this business method case and bootstrap it into some sort of “abolishing software patents” case. That’s probably because it is NOT A SOFTWARE PATENT CASE.

    I think Bilski is pretty narrow, despite what some may say. The claims were overly broad and recited only a mental process.

    I am not sure what the free GNU foundation or whatever was doing filing amicus briefs here, as the case had nothing to do with software, IMHO.

  3. Judge Mayer didn’t get it. He is the only one in this group calling for the overturning of all “business method” decisions. His dissenting opinion was just that, nothing more than a political statement that he doesn’t like business method patents. Remember claim rejections are about rejecting claims – not rejecting patents. The type of patent claims that he is talking about are those that “[serve] to hinder rather than promote innovation and [usurp] that which rightfully belongs in the public domain.” Those types of claims are rejected every day by the Office, BPAI, and the Fed Circuit under existing law. All of the basic tenants of capitalism and competition would support the majority in this decision. All new or useful business methods by definition save the consumer money. Most of those innovations are usually quite simple, but none-the-less are very effective at saving the consumer money. If there were no protection for those inventors, they would be less likely to INVEST! The decision to commercialize an invention requires some fair competitive advantage, else there is no business model that makes sense and capitalism fails. Patent protection for “Computer implemented” methods of “commerce” are extremely important to our economy.

  4. For those interested in the Prometheus Labs case, the briefing on that appeal was stayed pending Bilski, and Prometheus has 14 days from the Bilski decision to file with the CAFC a summary of how Bilski impacts the Prometheus appeal.

  5. One claim that might represent patentable subject matter under Bilski is “A method comprising assaying homocysteine levels and prescribing folate supplements.” This could be complemented by a claim reciting “A method comprising assaying homocysteine levels and prescribing folate supplements if said homocysteine levels are high.” You could also substitute the prescribing” step with a reporting, recording, or communicating step. Again, these are claims we are trying in our practice (note that the Prometheus court points out that the Prometheus claims do not include such a prescribing step).

    I agree that, under Bilski’s baffling divorcement of preemption policy from patent-eligibility, these claims might fly. They clearly preempt the “fundamental principle” within a field of use. A reporting step, as pointed out by SF in another string, is an even more egregious preemption.

    Of course using these claims has gotten you out of the 101 pan and thrown you directly into the joint infringement (BMC v Paymentech) fire. What single party both assays homocysteine levels AND prescribes folate supplements? None. No direct infringement… no inducement. In fact, I would guess that doctors rarely report the homocysteine levels or the folate deficiency (and how would you catch them anyway?), but they don’t assay so that doesn’t matter.

    The reference lab assays and often might report, but they won’t if they’re smart (or have a smart lawyer). Suppose the patent’s finding (high Gene X expression is associated with good response to Drug Y) is disseminated widely in medical journals. Now suppose a reference lab offers to measure Gene X levels without ever mentioning a purpose (assuming mentioning a purpose would even satisfy the “reporting” step of the claim, which I doubt). Finally, the reference lab communicates the Gene X expression levels to the doctor without suggesting any course of treatment. The doctor records that the patient has high Gene X expression and should be prescribed Drug Y. Who do you sue? No single party practices all steps… worthless claim.

  6. bruinjack, you are wrong about the claims at issue in Prometheus Labs. Here is claim 1. I’ve deleted the baloney clauses at the end of the claim as there are no steps recited in those clauses. I’ve also deleted the preamble as it similarly adds nothing.

    “(a) administering a drug providing 6-thioguanine to a subject having said immune-mediated gastrointestinal disorder; and
    (b) determining a level of 6-thioguanine or 6-methyl-mercaptopurine in said subject having said immune-mediated gastrointestinal disorder”

    Admininstering the drug is old. “Determining” is a mental step.

    Claim is dead. End of analysis.

  7. Product by process ?

    product: the computer processor configured, by execution of a software program, to X.

    process: directing the processor to read and execute the software program.

    Comments?

  8. “…now who was it that said that the mere act of measuring something changes that very something?

    …I am not certain why I am thinking of Heisenberg.”

    Ha! Good catch! I had better start preparing a standard declaration by a quantum physicist!

  9. …now who was it that said that the mere act of measuring something changes that very something?

    …I am not certain why I am thinking of Heisenberg.

  10. Note that measuring an analyte (e.g., gene expression or drug metabolite levels) normally involves physical “transformation” of at least one “article.” For example, amplification of DNA involves synthesis of single nucleotides in solution into a string of nucleotides in a nucleic acid molecule; determination of the level of a drug metabolite often involves breaking that molecule down in a mass spectrometer. However, under the narrow-minded reasoning of Bilski, such a transformation might be an “insignificant extra-solution activity” or even mere “data-gathering.”

    One ray of hope might be the discussion of In re Abele, since most raw molecular diagnostics data represent some physical element (e.g., gene expression levels) and the transformation of such raw data into some useful form (e.g., a recommended diagnosis or prescription) might be patent-eligible.

  11. I don’t have a link to the Dist Ct. opinion (Southern Dist CA – though it is available on Lexis) and I have only heard second hand that the appeal is forthcoming, but here are a couple links:

    link to patracer.com

    link to ama-assn.org

    The claims at issue recited administering a drug (physical step), testing for metabolite levels (physical step), and adjusting the dose if levels are too far out of optimal range (arguably physical step). The Dist Ct basically parroted Breyer’s LabCorp dissent in holding the claims invalid as directed to a natural phenomenon. Of course, the decision now falls right in line with Bilski’s discussion of mere “data-gathering.”

    I just hope the CAFC gives a dead-on affirmance of the claims (no joint infringement punt like the one Judge Rader proposed in LabCorp) and sends it up to SCOTUS for a definitive answer.

    Of course, that answer could end up laying waste to a vital health care industry…

  12. “More interesting to us in the diagnostic field will be the result of the appeal in Prometheus Labs v. Mayo Collaborative.”

    Linky? What are the claims at issue?

  13. Given the obvious connection to diagnostic correlations (look at the number of comments above discussing LabCorp), I’m a bit perplexed as to why no molecular diagnostic companies chimed in as amici.

    Hopefully SOMEONE will enlighten the court in Prometheus Labs.

  14. More interesting to us in the diagnostic field will be the result of the appeal in Prometheus Labs v. Mayo Collaborative. In that case we will see whether the CAFC recognizes the far-reaching and destructive potential of the language in Bilski.

    I just hope they don’t obliterate personalized medicine in the process.

  15. I would like to add a little to JTS’s excellent comments.

    a) patents are an equalizer:
    Large companies do not need innovative products to dominate a market. Rather, they can lag behind and “copy” someone else’s proven ideas. One example is the improvements to Internet Explorer that are similar to features first found in Firefox. Patents are necessary to give the little guy a chance in the market.

    b. patents encourage innovation
    When confronted with a patent, a potential infringer has three reasonable possibilities:
    1) pay the inventor who, having made money, will continue inventing ideas and prove to others that inventing is a reasonable career option.
    2) invent something that does not infringe the patent.
    3) if they don’t want to pay the inventor who went to the expense and risk of publishing his or her idea, and are too lazy or unimaginative to invent something new, people can continue doing what they were doing before.

  16. A plea to Dennis:

    If comments must be divided into multiple pages, could we have an indicator “X comments on Y pages” and the option to jump to a particular page, or at least to the most recent comments?

    Thanks again for a great blog.

  17. Max 10/31/08 7:21AM
    In pharma, the EP is rational with “second medical use claims” and the recent de facto agreement to allow pharmaceutical methods of treatment: T1020/03, T230/01, Actavis in the UK. Unfortunately, second-medical use of devices and methods of surgical treatment are still not allowable subject matter in Europe.

    Malcolm 10/31/08: 2:15 PM
    Doctors can’t be sued for infringing claims directed to methods of treatment. Doctors can be motivated (by patents) to develop new surgical methods and publish them so they can get credit. Doctors can be motivated by the promise of money to help develop medical devices to implement the methods they invent. I would be interested to know your model for encouraging technological and scientific progress.

  18. Well JTS you think anything you have created you “own” you should be able to patent. Like Angelina Jolie’s trademarked child, I suppose. Mayer construes “useful arts” in his dissent, and i think he’s right, that it is synonymous with technology (like TRIPS) and excludes writing innovative code for a computer to run. On another thread is a contribution from an economist, who points out that patents on pharma benefit society but patents on software have the opposite efect.

  19. It is a complicated decision in a complex area of law.

    This case does not fit the pattern of the other Federal Circuit cases that recently recieved grants of cert.

    Some software patents will survive 101, some will not.

    A bright line rule would be preferable.

  20. MaxDrei wrote:

    “Newman boldly announces that “the most grievous consequence (of today’s majority decision) is the effect on inventions not made or not developed because of uncertainty as to patent protection”. Sorry. I can see that a chemist would worry about dampeners to investment in new life-saving pharmaceuticals. Fair enough. But on what EVIDENCE does she assert that such legal uncertainty will have an overall dampening effect on creativity and investment in the world of software-writing? It seems to be no more than her gut feeling. Just because a patent system for pharma is undoubtedly in the public interest, it’s not a “given” that awarding patents to creative writers whose medium is computer code is also a win for the public interest.”

    Apologies if the following jumps around a bit, but the issue is really too complex to address in a blog entry anyway.

    Why is the burden on Judge Newman or on those who favor strong software patentability?

    Let me ask you this. Why should I, as a software inventor, be restricted from obtaining a patent based on what happens in my industry as a whole? If I work hard and invest in experimentation and develop a new unobvious program that is beneficial to mankind (maybe a new algorithm for processing MRI signals to create better MRI images), why should I be denied protection if others in my field are not able to use the patent laws to their fair advantage? What difference should it make to me, the diligent improver (is that a word?) of life for mankind, if there is a net benefit?

    The whole argument overlooks the idea that patents are not just a tool for social policy (encourage advancment), but they are also a tool for fairness and justice. It’s just and fair for people to OWN that which they give birth to… that which did not exist before their time and resources were spent to bring it into existence.

    Some say the software industry was successful before patents, so patents aren’t needed. That’s naive. The fact that a field of industry exists before patents are prevalent in that field does not prove that patents are not fair or called for. If that reasoning were valid, then every new field of industry to emerge before patents are used in that field would be precluded from patent protection.

    Heck, let’s take your bioscience example. Let’s suppose there’s some question about whether patents should be granted to genetically modified plants. Let’s suppose there’s evidence that people are doing this reasearch and investing in genetically modified plants without knowing whether they are even patentable. They succeed and make some money on their new plants. Others follow suit, and an industry is born.

    Now at this point in time we can argue: look, this industry is bearing fruit without patents, so why extend the realm of patentable subject matter to include it?

    But it’s a fallacy. Because a field of industry exists and is successful does not mean that it is as successful as it could be. The real issue – which you rightly raise – is not whether the industry is ok without patents, the issue is whether the industry would be better. The pre-patent success of an industry does not prove patents are not a net benefit.

    If there is a question about the net benefit, the answer is not to limit all patents in that industry. The answer is to figure out why there is not a net benefit and solve it. For example, if patents are a problem because the PTO issues junk patents with overbroad claims on obvious subject matter or with insufficient enablement, that’s not an inherent problem with software patentability. That’s a systemic problem that can be fixed.

    In fact, from firsthand experience I think others will confirm that the PTO has become much more careful about allowing overbroad software claims.

    So, coming back to whether there is a net gain or not, the burden of proof is on YOU.

    One last digression. Some argue that the problems of accidental infringement for the well-intended software developer are unacceptable; so patents should not be allowed. A patentee’s ideas are too easily innocently duplicated and implemented by others. Because software is easy to write (or at least is not capital intensive).

    But it’s a two-way street. If my company innovates user interfaces for a CAD program that cuts a draftsman’s time in half, it’s the nature of software that the innovations are easily imitated. So sure, in the software field there are problems with accidental/innocent infringement, but there are also very significant problems in reverse-engineering and general copying or ripping-off someone else’s ideas. I assure you, the open-source community would absolutely love to build a de facto equivalent of MS Excel … they’d love to build features like conditional formatting or other true innovations that make Excel a desirable product to use. But then where would that leave a company like Microsoft? They pay developers millions to come up with new features and improve products, and then open-sourcers or commercial imitators then can come along and copy and reduce or eliminate the income derived from selling Excel.

    The problem with the anti-software-patent arguments is that – ironically – they’re too abstract. As soon as you start to deal with specific cases, real investors, and real world conflicts, the vague arguments against patents start to crumble and blow away in the wind.

  21. Newman boldly announces that “the most grievous consequence (of today’s majority decision) is the effect on inventions not made or not developed because of uncertainty as to patent protection”. Sorry. I can see that a chemist would worry about dampeners to investment in new life-saving pharmaceuticals. Fair enough. But on what EVIDENCE does she assert that such legal uncertainty will have an overall dampening effect on creativity and investment in the world of software-writing? It seems to be no more than her gut feeling. Just because a patent system for pharma is undoubtedly in the public interest, it’s not a “given” that awarding patents to creative writers whose medium is computer code is also a win for the public interest.

    Maybe the real reason for the majority to hold as it did is that it has read the report of the UK Government of its polling of all those with an interest in software, and now quietly disagrees with Newman.

  22. “In his Dissent, Judge Rader asks the insightful question of why a new test is necessary . . . I believe Rader’s position is quite defensible. . . . In the majority construct, the machine-or-transformation test serves as a fairly accurate proxy . . . . The court does not, however, answer why any proxy is necessary.”

    I agree completely. Just as the TSM test was developed as a proxy for Graham, the en banc Bilski decision sets up a proxy for the real analysis that should be set forth. Practitioners would be foolish to ignore the message from the Supreme Court in KSR – rely on a proxy test, and you may find us pulling the rug out from under you 10 years from now. At a minimum, any practitioner relying on the en banc Bilksi test in arguing for allowance of their claims should backstop such arguments with arguments based on Supreme Court precedent.

    Does any body else feel like the repeated references to Supreme Court precedent in the en banc Bilski decision (e.g., “We believe this is faithful to the concern the Supreme Court . . .”) signals an uncomfortable level of self-doubt by the panel? If the panel was *really* convinced that their decision was on solid ground, it seems that the opinion itself would have had much more of an air of confidence.

  23. Nice job 6000.

    I also like “consider a concept without thinking of a specific example”.

    Wait a second – this reads on 95% of all patent claims….

  24. Let’s go with “existing only in the mind” then, ask yourself, does the claim in question exist only in the mind?

  25. “what does “abstract” mean and how do you tell if something is “abstract?” ”

    FYI there’s this handy thing called a dictionary.

    consider a concept without thinking of a specific example; consider abstractly or theoretically
    pilfer: make off with belongings of others
    existing only in the mind; separated from embodiment; “abstract words like `truth’ and `justice’”
    abstraction: a concept or idea not associated with any specific instance; “he loved her only in the abstract–not in person”
    consider apart from a particular case or instance; “Let’s abstract away from this particular example”
    not representing or imitating external reality or the objects of nature; “a large abstract painting”
    outline: a sketchy summary of the main points of an argument or theory
    give an abstract (of)
    dealing with a subject in the abstract without practical purpose or intention; “abstract reasoning”; “abstract science”

  26. “On the contrary, the patenting of new technological arts will greatly benefit from decisions like this, for the reasons given in Judge Mayer’s dissent (among others). Of course, patenting in arts such as “making a profit” and “a computer-based method of doing something that is old in the art” may decline.

    But the only people who will suffer from that decline are a few patent prosecutors and trolls. As a whole, the American public will not suffer at all from the change. On the contrary.”

    I think this takes a pretty narrow view of the potential reach of the Bilski decision. Though the facts involve questionable business method claims, the language would appear to apply to things as varied as molecular diagnostics (as the later comments about LabCorp clearly demonstrate). I might be a bit biased but I don’t think the whole of personalized medicine can be lumped anywhere near the “useless” and “unfit for patenting” pile occupied by naked business methods.

  27. A couple observations:

    (1) Last I checked, the Fed Cir has to follow SCOTUS law. Even if you think SCOTUS didn’t know what it was doing, or if you think Diehr and Co. are outdated, or whatever, the Fed Cir did not have the option to just say, the heck with that baloney, we’ll make something up ourselves. So everyone posting to that effect should lighten up. (Of course, the question remains whether Fed Cir read those cases right or not, or whether reading them coherently was even possible).

    (2) As simple and nice the Rader “is it abstract?” test sounds, the problem is that it’s not so simple to figure out what’s abstract. So my question for all of you who think Rader nailed it — what does “abstract” mean and how do you tell if something is “abstract?” If you have to resort to words like “physical,” “tangible,” “concrete,” etc., well, you’ve played Taboo before.

    (3) Again, Fed Cir has already stated that programming a “general purpose computer” turns it into a “special purpose computer” in Alappat. I’m not sure what either term means or whether either is enough of a machine tie under Bilski. But that might answer some of this elf swapping switches business, no matter what BPAI has said (though point taken, you’re guaranteed a rejection at the PTO if you want to take one for the team and contest the BPAI view).

  28. “So….a machine with moveable switches positioned in a certain way is not patentable, but if an elf runs around and duct tapes the switches into position it suddenly becomes patentable subject matter?”

    I did not opine on a machine with movable switches positioned in a certain way. I will however opine on a machine with transistor switches positioned in a certain way if you like. That, is what I’m considering a generic computer, and is what is usually being considered in software claims unless I miss my guess.

    “Virtual objects in virtual environments nowadays have “real” cash value in “real” reality. I wonder if the Federal Circuit knows about that.”

    They do, some of them were discussing the tax ramifications, but most of the major companies merely threatened to destroy the whole enterprise in one way or another and the end result would be 0 dollars for the gov and spoiled gameplay.

    “An old desktop computer running software is not patentable subject matter under 101, but the software burned onto an EPROM is?”

    That’s a good question. It might be. Under 101 that is, but you’ll still have to deal with 103, and that’ll be a btch.

    “(and lets not forget Wx Parte Wasynczuk — an apparatus with two general purpose processors *is* a particular machine for 101′s test).”

    Probably a bad decision. Although, it’s easy to see how a court could have decided thus not realizing the mischief that would ensue.

    “I’m not knocking you, 6000, because I’m afraid (certain?) you are correctly stating the law ”

    Indeed you are certain.

    “Any chance that Bilski will appeal? When will we know?”

    To the SC? I WISH!!! Give the Supremes a piece of this juicy goodness of a case and watch as new aholes are ripped.

  29. “Should the scientist (or the person who invests their hard earned money in the research) be rewarded for taking the risk to develop and validate this assay which will save lives? Based on the opinions expressed above, the answer is clearly no.”

    Why? It’s easy to write a diagnosis claim that avoids LabCorp and Bilski. Then the “scientist” can earn all kinds of money by sueing doctors who “save people” with the method. Awesome!

  30. After reviewing Chief Judge Michel’s opinion and Bilski’s Claim 1, the Federal Circuit might have done everyone a favor to skewer this Claim on 35 USC 112 grounds (most perferably paragraph 1) as SCOTUS did in O’Reilly v. Morse. Bilski’s Claim 1 is so broad and amorphous that it’s hard to determine what it covers, and it’s unlikely the spec would support the scope sought here. That was the problem with Morse when he tried to patent all forms electronic communication when all he could support was the telegraph. Again, it would be better to screen subject matter like Bilski’s on 35 USC 112 (and 102/103) grounds, and not use the nebulous “machine or transformation” test that is hard to reconcile with the express language of 35 USC 101 (which says “any new and useful” process, etc.).

  31. As an entrepreneur in an online start-up, this case leaves me guessing whether our patent attorney now just needs a few magic words that will hook our novel way of doing business online to a standard computer. Millions of dollars will be wasted figuring this out and we’ll probably contribute to that sum, spending time and money that could be used to better execute our business and add value to the marketplace.

    I’ve filed software patents at two start-up companies previously and I think the current biz method patent system is broken. Don’t just give us a more confusing legal standard. We should move to system with a very quick examination process (perhaps peer review?) and grant a very short exclusionary term that better matches the speed of innovation in today’s market.

  32. Regarding this LabCorp fracas, Malcolm Mooney’s logic is flawed, but his conclusions are, nonetheless, correct. It’s pretty well settled that you can patent a novel application of a “fundamental principle,” even where the novel application is to an old process. So, the fact that the blood assaying was old has nothing to do with a 101 analysis. Discussion of old vs. new is rightly within the 102/103 realms, as the Bilski opinion refers. However, Judge Rader is also incorrect in his analysis of LabCorp’s claim 13. Rader tries to make the admitted patent ineligible relationship between the homocysteine levels in blood and a vitamin deficiency patentable by marrying it to a concrete blood test that non-abstractly finds out the homocysteine level in blood. The problem with this conclusion is that the “fundamental principle” here in LabCorp is the relationship of homocysteine level in blood to a vitamin deficiency. Claim 13, which was the claim in LabCorp discussed in Justice Breyer’s dissent, pre-empts all other uses of that “fundamental principle.” The principle doesn’t apply to anything but blood analysis and a particular vitamin deficiency, so trying to associate it with any type of blood test (which is what claim 13 sought to cover) pre-empts any other use of that fundamental principle. Therefore, claim 13 in LabCorp became an end-around (successful) attempt to patent the fundamental principle in which the doctors merely thinking about the relationship when looking over a blood test becomes infringement. At the Fed Circuit level, though, it doesn’t appear that LabCorp asserted 101 invalidity (malpractice?) and the Fed Circuit (Judge Rader delivering the majority opinion, hmm) didn’t address it or take it up sua sponte. So, the claim 13 patenting of the fundamental principle lives even though it fits pretty squarely into the pre-emption analysis set forth in the Bilski opinion.

  33. “If higher review did inspire the dictum, is it worth the confusion and uncertainty that a practitioner now faces as the court refines case law?”

    I think that’s the key: you, like Rader and Newman, note the uncertainty and the majority is implicitly saying “we’ll get to it”

  34. Hi Dennis, there might be a typo in your analysis above, in the section that reads,

    “Along this line, the court also dispelled two rising concerns, noting that that (1) neither novelty nor obviousness have any relevance to the section 101 inquiry, and (2) the fact that an individual claim element is – standing alone – patent eligible does not render the claim unpatentable because patent eligibility is considered while examining the claim as a whole.”

    Regarding no. 2, I think that it should say “the fact that an individual claim element is – standing alone – patent INeligible does not render the claim unpatentable.”

    “Ineligible” not “eligible.”

    Page 22 of the slip opinion says “Thus, it is irrelevant that any individual step or limitation of such processes by itself would be unpatentable under § 101.” This could be a useful statement to prosecutors.

  35. SF – interesting… It does seem like the court went to great lengths to ensure that the SC would not grant cert. here. If higher review did inspire the dictum, is it worth the confusion and uncertainty that a practitioner now faces as the court refines case law? I am inclined to answer in the negative, but I suppose (in view of KSR) there is substantial benefit in keeping cases from the SC’s tampering.

  36. As usual the majority contorts to the will of what is perceived as the common ground – with something in it for everyone. And per usual Newman has the more cogent analysis (disagree as you might on policy – at least you know the law with her), and arguably the legislative process can then function to change the law.

    Between SCOTUS, CAFC (now cribbing from the muddled thinking of recent SCOTUS opinions?) and PTO (post judgment reexamination) patent law is backsliding into an unpredictable morass. A morass that governs trillions of dollars of value for the US economy. Do recall good people – the whole point of the creating of the CAFC – was to spur the innovation economy and risk taking (create high value jobs!) by creating a more uniform and predicable body of patent law. Ergo – transactions between parties can clear w/o what is now ridiculously protracted, expensive, uncertain, “discretionary” litigation, re-litigation and re-litigation and re-litigation of even the simplest matter. The only people that helps are lawyers and the “flat earth” crowd (BB racing to the bottom – ever seeking to offshore american industry and jobs).

  37. Kevin R wrote, “I read the comments directed to the meaning of this statement. However, I would really like some insight as to WHY this was included in Michel’s 32 page opinion.”

    It may be to let the Supremes know that, if the Supremes are inclined to deny cert, they can follow their inclination because the Feds will be refining the caselaw and thus review at this time may be premature.

  38. “We leave to future cases the elaboration of the precise contours of machine implementation, as well as the answers to particular questions, such as whether or when recitation of a computer suffices to tie a process claim to a particular machine.”

    I read the comments directed to the meaning of this statement. However, I would really like some insight as to WHY this was included in Michel’s 32 page opinion.

    I confess to not reading all of the amicus briefs, and I am sure that the issue about recitation of gp computers was extensively and elegantly briefed. But even so, why include this dictum?

    In my view, the fact that an en banc court took the occasion to hint at issues not presented on appeal (except perhaps by amicus curiae), especially issues that might drastically alter drafting and prosecution, is extremely disturbing. Does anyone have any insight as to why this was even included in the opinion?

  39. Googling something like “secret, nature, information” to get to that Wikipedia entry doesn’t convince me that issuing patents on tax mitigation schemes will get us any closer to understanding the secrets of the natural Universe. Night Writer perhaps you could help me, by sharing with us more of your thinking on this interesting topic. I suspect that Newman is still thinking “natural forces” like a chemist (and like German and Japanese patent judges) and that, for cases like Bilski, we need judging by information scientists, rather than chemists or accountants, bankers and actuaries.

  40. Posted by: MaxDrei

    “Judge Newman writes that patents are to incentivize our efforts to discover the “vast secrets of nature”. OK, but what “secret of nature” does a new and inventive computer-implemented business method reveal?”

    MaxDrei:

    link to en.wikipedia.org

  41. How incredibly odd people are. What we value most as people is our reasoning, if you will, our infomration processing. Yet this opinion devalues and demeans information processing by machines. How dare they do what we value so highly! I suppose a machine that could generate a brief for the Federal Circuit is simply dealing with abstract concepts and thus not eligible for patentability.

    Consider:
    (1) Claim the “computer program” as a machine including a special purpose chip.
    (2) Claim the method of the machine.
    (3) Now how can the method not fall under 101? If one says that it is not under 101 then all the case law and reasoning for why a method of a machine can be claimed goes out the window.

    The reasoning to exclude it will have to go that because you could write a program on a general purpose program to implement the method that it is not eligible for patentability. This means that all computer architecture patents are (or should be if we were consistent) invalid.

    Consider too that I can devise a electronic CPU that operates with instructions like a program to process electrical signals. Now all electrical and electric circuits are not eligible for patentability under the same reasoning since I could write a program for my “electronic CPU” to implement the same ciruit.

    I think the same reasoning could exclude all chemical applications as well. I could build a machine that could build any molecule. Then it would be a program that implements the construction of the molecule. Etc.

    Further, consider that if a transformation is not occurring, then why does it take space and energy to represent information and process information?

    Is a piece of wood with two hinges attached transformed? What is transformed? How is that transformation more profound than the transformation of information?

    The reason that this opinion causes so much trouble is that it is not sound reasoning with the prior case law and illustrates a profound lack of understanding of technology.

    If we want to exclude software, we should do it with laws from the legislative branch and not conjure up case law that is an insult to our system of justice. We are getting close to: it is eligible for patentability if I say so, and it is non-obvious if I say so. Frankly, it is sickening. Probably, it will work something like this: if your patent application is from Intel, then it is under 101, if it is from Microsoft, then it is not eligible. It would be interesting to test this with identical patent applications save for the assignee.

    Further, this argument that this is a new use for an old machine is simply wrong. The CPU is a clever way of implementing any information processing machine. The cost of using the CPU is high. A special purpose chip to implement a “computer program” would run much faster, but we use the CPU because it is cheaper in terms of labor and construction costs.

    Information engineering is engineering just as much as any other type of engineering. It is not science. We want to promote innovation in information engineering.

    Signed,

    Wishing Judge Rich were still with us to guard the patent system.

  42. 6000 wrote: “Now, if you were to recite one that was permanently programed via hardwiring to do x then you’d be right, that would be a particular machine.”

    So….a machine with moveable switches positioned in a certain way is not patentable, but if an elf runs around and duct tapes the switches into position it suddenly becomes patentable subject matter?

    An old desktop computer running software is not patentable subject matter under 101, but the software burned onto an EPROM is?

    (and lets not forget Wx Parte Wasynczuk — an apparatus with two general purpose processors *is* a particular machine for 101′s test).

    Holy f—. I feel like I’m stuck in Wonderland with Alice or maybe I’m an unwitting participant in a game of Calvinball.

    I’m not knocking you, 6000, because I’m afraid (certain?) you are correctly stating the law despite the “we’re not decidin’ whether a general purpose computer is a particular machine” language in Bilski.

    Oh, boy, we are in for an interesting ride in Patent-land.

  43. Mr Gur, how about the European “second (and succeeding) medical USE claim” to meet your Metabolite concern? Come to think about it, how about using the EPO’s “solution to an objective technical problem” test for patentability, as a way of meeting your concerns, those of Alsee just above, and those of Pauline Newman and Randall Rader? The interesting thing about the consistent, logical and Applicant-friendly, Opponent-friendly, patent attorney-friendly, high tech friendly jurisprudence of the EPO is that it has developed peacefully and progressively, over the last 30 years, free from any interference and disturbance by any Court sitting on top of it. There is no such court. Members of the EPO Boards of Appeal have to face all those expert Examiners, every day in the EPO canteen, then face Judge Rader, whenever he is over here for a conference. The jurisprudence of the Technical Boards of Appeal of the EPO is a unique treasure, available for all the world to use.

  44. “We should let people die by not developing such assays and we should reward talented people who choose to be entertainers rather than scientists or entrepreneurs.”

    Erez – not just entertainers – also bank CEOs. For example, CPF [Coalition for Patent "Fairness"] member Countrywide Financial which opposed compensating inventors, knew how to compensate their CEO quite nicely. I am sure there are many other examples.

  45. But not as confused as some people:

    **”What about virtual machines?”

    Virtual machines don’t even exist, that’s why they’re virtual. Right? LOL. **

    Right? Wrong! A virtual machine exists inside one programmable machine as a software emulation of another machine.

    Virtual reality exists. It’s just not the same thing as “real” reality.

    Virtual objects in virtual environments nowadays have “real” cash value in “real” reality. I wonder if the Federal Circuit knows about that.

  46. Let’s say we have a well-established assay to measure the concentration of a given metabolite in the blood.

    Let’s just say a scientist suspects that a certain range of concentrations of the metabolite in blood is indicative of the early stages of a dreadful disease which can be treated if detected early.

    Should the scientist (or the person who invests their hard earned money in the research) be rewarded for taking the risk to develop and validate this assay which will save lives?

    Based on the opinions expressed above, the answer is clearly no.

    We should let people die by not developing such assays and we should reward talented people who choose to be entertainers rather than scientists or entrepreneurs.

  47. The ruling contained a bizarre contradiction.

    They cited the Supreme Court’s repeated statement of a patentable process “transforming or reducing an article to a different state or thing”, but then they reference an example involving data.

    Since when is information an article?!?

    The judges were clearly having a hard time with the ruling. They apparently overlooked that bit of incoherence while attempting to accommodate both the pro and con interests. A muddled result trying to place boundaries on what can be validly patented, while trying to somehow not invalidate the countless business method and software patents that have been issued in the wake of the State Street Bank decision.

    One way or another it is impossible for this ruling to stand as-is. Either the “transforming a article” rule is kept, meaning process patents are for physical processes and meaning the invalidation of many business method and software patents, or the “transforming a article” rule is tossed out affirming almost unrestricted patentability of non-physical processes.

    One way or the other the courts have to stop sitting on the fence on this. This ruling did nothing to reduce the ambiguity and confusion of the US patent system. One way or the other, I seriously hope the Supreme Court takes up the case and hands down a powerful clear ruling to resolve the mixed interpretations ever since Diamond v Diehr. Patentability should not be a game of draftsmanship and applying “magic words”.

  48. Judge Newman writes that patents are to incentivize our efforts to discover the “vast secrets of nature”. OK, but what “secret of nature” does a new and inventive computer-implemented business method reveal?

  49. The decision should come as no surprise to those practitioners who eschewed the hype and failed to change their basic claim drafting practice because of the underlying application. In other words, if like me and many others, you drafted “business method,” “software” claims as you would any other claim, e.g. being mindful of appropriate subject matter concerns, then you should not lose any sleep.

    On another note we have a classic glib, trivial, Mooney post:

    “This is unpatentable absent recitation of one or more algorithms or examples of source code that yield results that would surprise one skilled in the art of computer programming.

    It’s that simple.”

    Apparently simply and trivial, but nevertheless beyond your meager grasp.

    First; algorithms are not patentable. Source code is not patentable. And last; the standard of patentability is not and, thankfully, will never be “results that would surprise and delight Malcolm Mooney”

  50. “”A particular machine” can’t be a general purpose computer.

    Why the heck not? What the heck is a “general purpose computer” anyway? Just about any computer can be reprogrammed to do other things, does that make it “general purpose”?”

    at the least, perhaps you should re-examine to explanation of pre-emption in the decision.

  51. Steve:

    No one will take your challenge because it all depends on the definition of business method, which varies. (Some think of claims like Bilski’s; some think of software processes generally.)

    If the Federal Circuit were going to throw out all business methods, they’d first have to define “business methods.” Why would they go through the effort to do that, when they can just point back to their two-part rule based on their interpretation of Supreme Court caselaw, which nicely shoots down claims like Bilski’s?

    Rader does a great job pointing out all the uncertainty this rule creates. I have to think the Supremes will chime in, if asked to.

  52. So; in light of this confusing, convoluted, “who’s on first?” decision, anyone brave enough to take a shot at writing a “biz method” claim they believe would actually be allowed…even if it took an appeal…or the FedCir to obtain?

  53. “What about virtual machines?”

    Virtual machines don’t even exist, that’s why they’re virtual. Right? LOL.

  54. “Software patents are going to die not because of Bilski but simply because it’s the right thing to do.”

    Tru dat?

    “Anyway, that’s my take on this case.

    Posted by: 6000 | Oct 30, 2008 at 07:29 PM”

    SOMEONE’S A STEALIN MA NAME!

    “However, ALL computers when programmed become “particular machines”. ”

    Um, not really, they’re still general purpose machines and can be reprogramed at any time. Now, if you were to recite one that was permanently programed via hardwiring to do x then you’d be right, that would be a particular machine.

  55. “You can’t patent an old animal by teaching it a new trick.”

    like teaching a dog not to eat particular hygiene products?

  56. “Is this the old Malcom speaking? The issue is not patentability over prior art, its patent eligibility. Malcom, sometimes you really skip a beat.”

    Iirc MM’s original, and ongoing, position on computer software claims has been that they are always obvious over the prior art. Although, he may take issue with them under 101 as well.

  57. Malcom, still you ignore the examples. If software patents should go away, then most patents for digital circuits should go away also.

  58. I’m torn on this. While previous business method awards were too broad, this swings the situation to the extreme opposite end of the spectrum – meaning it will probably be too narrow.

  59. “What people like you forget is that the purpose of patents is to promote the useful arts. Anyone who would argue that the development of comptuer software is not a useful art should go check into a mental hospital.”

    Cooking recipes are useful, too. But you can’t patent an old piece of paper with a new candy bar recipe on it, even if the recipe is readable by a computer that controls a robot.

    Yet you don’t hear Mario Battali whining about it. Why is that?

    “Some people are saying that Bilski means the death of software patents”

    Software patents are going to die not because of Bilski but simply because it’s the right thing to do.

  60. “Just out of curiosity: why not? Why shouldn’t that fact be relevant to patentability? Doesn’t that fact make computers analogous to … an animal? You can’t patent an old animal by teaching it a new trick. Anybody remember why not?”

    Don’t know why I waste time on this junk…

    I really don’t understand the animal thing.

    Anyway, you ignore the examples. Suppose a hard-wired patentable device. There is one switch that can be flipped on or off, but that’s it. It can change the behavior of the machine. Now are you saying that the presence of the switch renders the circuit ineligible? If one switch does not, why would the number of switches matter? A computer is just billions of switches. If I figure out a way to arrange those switches to say … process an image in a way that can identify cancer in an image of a cell … I should not get a patent just because the machine this is performed on is reconfigurable? If I figure out a way to arrange those switches so that they can identify groupings of the switches that are prone to errors, I shouldn’t be allowed to have a patent? The number of examples are limitless. What people like you forget is that the purpose of patents is to promote the useful arts. Anyone who would argue that the development of comptuer software is not a useful art should go check into a mental hospital.

  61. “Love it, love it, love it. Yes, I totally agree a computer running new software X is analogous to a combination lock with a new combination, i.e., both are unpatentable over the prior art.

    Feel the python”

    Is this the old Malcom speaking? The issue is not patentability over prior art, its patent eligibility. Malcom, sometimes you really skip a beat.

  62. The crux of the decision seems to be pages 13-14. It notes the machine-or-transformation test was used in Benson, reaffirmed in Diehr, and discussed in Flook. In both Benson and Flook the Supreme Court said a process could satisfy 101 without passing the machine-or-transformation test. Because this caveat was not repeated in Diehr, the FedCir takes it to mean that the machine-or-transformation test is determinative???? This fallacious logic is incredible.

    The Court says “X” (X=test is not determinative but passing it shows 101 is satisfied), The Court says “X” again. And then the Court is silent regarding “X” so the FedCir interprets that to mean that “X” is no longer true? That’s completely illogical. Unless the Court has done something either inconsistent with “X” or has explicitly negated “X”, the statement “X” still stands.

    Here’s what they said: “this caveat ["We do not hold that no process patent could ever qualify if it did not meet the requirements of our prior precedents"]was not repeated in Diehr when the Court reaffirmed the machine-or-transformation test. … Therefore, we believe our reliance on the Supreme Court’s machine-or-transformation test as THE applicable test for § 101 analyses of process claims is sound.”

    and we “reaffirm that the machine-or-transformation test, properly applied, is THE governing test for determining patent eligibility of a process under § 101.12″

    That just doesn’t make sense. The Supreme Court said that it is possible for a process to be 101-satisfying without passing the transfomation-or-machine test, and the FedCir says the opposite? It flatly ignores Supreme Court precedent based on incredibly poor logic.

    The examples of application of the test are not very helpful.

  63. If Bilski recited in their claim, “a computer implemented process performing on a digital computer…” would this then be tied to a machine to pass muster under 101? That’s the $99,000 question. Some people are saying that Bilski means the death of software patents, but I’m not so sure until this question is answered.

  64. “The fact that a computer can be reconfigured into an infinite variety of de facto machines should have no bearing on patentability.”

    Just out of curiosity: why not? Why shouldn’t that fact be relevant to patentability? Doesn’t that fact make computers analogous to … an animal? You can’t patent an old animal by teaching it a new trick. Anybody remember why not?

  65. 6000 –

    A “general purpose computer” just means a computer that can be programmed for many different types of tasks — e.g., accounting, graphics. A “special purpose computer” means a computer that is designed to optimize certains types of applications(e.g., a DSP). However, ALL computers when programmed become “particular machines”.

    In Bilski the method recited in the claims did not set forth any computer at all. The appellants conceded as much. Thus it flunked the “machine-or-transformation test” though it may have passed the “useful, concrete, and tangible result” test [State Street].

    Anyway, that’s my take on this case.

  66. “Think of it like this. Imagine a mouse trap. Say you make the spring adjustable. You change the tension on the spring and in a sense it’s a new machine. Just because the machine is changeable is it unpatentable? No. What about a combination lock. You change the combination, which involves changing the arrangement of gears or whatever. In a sense it’s a new machine because the relations of the parts has changed.”

    Love it, love it, love it. Yes, I totally agree a computer running new software X is analogous to a combination lock with a new combination, i.e., both are unpatentable over the prior art.

    Feel the python.

  67. Unfortunately George, it must be a specific machine, and at least at present the Board has determined that a general use computer is not a particular machine.

  68. “A ‘particular machine’ can’t be a general purpose computer.”

    True, but a general purpose computer can be a particular machine. I think people reasoned this way before: If you had a hard-wired machine, a pure dedicated digital circuit that was new and useful, no one would question its patentability. Now if you have that same digital circuit and you make a part of it re-configurable so that the circuitry can change to perform in a different way, but you still leave it configured as originally designed (i.e., some bit can be turned on or off, but you leave it on as it was with the original hardwired invention), should that reconfigurable circuit be unpatentable but the hardwired circuit is patentable?

    The fact that a computer can be reconfigured into an infinite variety of de facto machines should have no bearing on patentability. If a claim is recited in a way that it clearly can be performed only on a computer, then why should that invention be limited just because the machine is realized on happens to be capable of being reconfigured.

    Think of it like this. Imagine a mouse trap. Say you make the spring adjustable. You change the tension on the spring and in a sense it’s a new machine. Just because the machine is changeable is it unpatentable? No. What about a combination lock. You change the combination, which involves changing the arrangement of gears or whatever. In a sense it’s a new machine because the relations of the parts has changed.

    This metaphysical game the FedCir plays is silly. Out here in the real world, computer scientists, researchers, and others work diligently do discover new general-purpose algorithms… search algorithms, categorizing algorithms, learning machines, caching schemes, and so on. These only are useful on a computing machine. They can be very useful in the real world. Yet we now need to walk a maze with electrified walls to get to the 101 green zone.

    A computer-implemented method is quite clear. It’s a method implemented on a computer. It can’t be implemented in your head. It’s not an abstraction. If a machine is performing (or configured to perform) the method, how can it not be a particular machine?

    Anyway, what an outrage. The court lays out a major new test for patentability, and then says a key part of it will work itself out? All they’ve done is tear something down without giving inventors any guidance on what they need to do to be sure they satisfy 101. It’s irresponsible. I’ve read the opinion, and I honestly could not read a claim and say whether it satisfies 101 or not. The decision is “indefinite”.

    sorry for the stream of consciousness rant… it’s just that there are real world people out there innovating in useful physical/technical ways, and the idea that somehow their ideas shouldn’t be patentable because of a court’s apparent desire to come up with some neat compact metaphysical test, it just ignores reality.

  69. “What’s the particular machine that it is tied to? <<

    a computer…. as opposed to not being tied to any machine (Bilski)”

    Interesting question, George. I guess one question would be whether the computer steps are post-solution activity a la Schrader.

  70. In Re Bilski aka Keep Patent Attorneys Employed Ruling?

    Any thoughts out there as to the effect on billings to be racked up prosecuting reexamination requests based on the context that the In Re Bilski result provides “a new light on the question of the validity of patents”?

    Or is this moot, since even though the required substantial new question of patentability is not limited to 102/103, the Reexam statute reads heavily on prior art in the form of patents and printed publications, and thus more indicative of 102/103 type challenges?

  71. What’s the particular machine that it is tied to? <<

    a computer…. as opposed to not being tied to any machine (Bilski)

  72. Whew man, a hundred some pages of goodness for me to read! Took them long enough that’s for sure.

    “It would seem that they would.”

    How so George? What’s the particular machine that it is tied to? What is being transformed?

  73. “This means they will be responsible for acting as a liaison between you and the USPTO in regards to your patent.”

    Mr. Feigin needs a proofreader, stat!

  74. In her dissent, Justice Newman said, “The court achieves this result by redefining the word “process” in the patent statute, to exclude all processes that do not transform physical matter or that are not performed by machines. The court thus excludes many of the kinds of inventions that apply today’s electronic and photonic technologies, as well as other processes that handle data and information in novel ways.”

    But the holding says “physical subject matter,” not “physical matter.” As a physicist, I think that energy, including electromagnetic waves, is physical subject matter. So the transformation of data by a computer ought to still be patentable subject matter under this decision, in my view. Although, it should be noted again that, “As the court noted later in the opinion, the transformed articles must be “physical objects or substances [or] representative of physical objects or substances” such as changing “raw data into a particular visual depiction of a physical object on a display.”

  75. If Bilski’s claims were set forth as being a series of steps executed by a computer, would these claims meet the “machine-or-transformation” test?

    It would seem that they would.

  76. Not sure how “formal” a weblog is, Weary, but I do agree with you that, when one’s readers stumble over one’s it’s's and poingient’s, one’s core message is correspondingly less likely to get through to its destination, be it the judge, the Examiner or, last but not least, the client. That’s a serious impediment, for a lawyer in private practice. It’s great that the brave new world has such “Esq.” people in it, because it gives me hope that I, although old and slow, can still compete, thanks to all that old 3R stuff I had to learn long ago. Keep posting, Weary; you make this blog more fun.

  77. (1) This wasn’t a software case. Lots of people were hoping it was, but courts (Fed Cir included) spouting off about things in dicta only gets everyone into trouble. So while it would have been nice to get some certainty into software patenting, this wasn’t the case. Since the Bilski method seemed destined to lose anyway, any dicta about software might have been harsher than in a case with a more palatable claim.

    (2) Rader’s approach sounds simple and great, but the discussions in this thread and all the discussions surrounding this case seem to indicate that it may not be so simple after all to figure out what is “abstract” or not. I’m not sure if this Bilski rule is the right one (or too draconian) but we sure need a better rule than “see whether it’s abstract or not.”

    (3) Not to pile on Mr. Feigin, but the Fed Cir doesn’t have Justices, just judges.

  78. “‘I posted my own analysis and comments on my website…’

    Fyi, Judge Newman is a woman.”

    And “its” and “it’s” are two completely different words, with different meanings. The same goes for “your” and “you’re”. Furthermore, “poingient” is not a word. I don’t know if you were looking for “poignant” or “pungent,” but neither seems particularly appropriate. Sorry, Michael, I couldn’t get past the first few paragraphs. In my view, spelling, grammar, and usage actually matter, at least in something that’s held out as formal work product of a lawyer.

  79. Leopold: “Malcolm, you are off-base on software patents, at least the software patents that matter.”

    Well, LB, last time I checked even software patents “that matter” are subject to challenge under 103. The fact that they are rarely subjected to the rigorous and creative arguments presented by Examiners to practitioners in other arts *is* the problem.

  80. A winning lottery ticket is a manifestly unambiguously, unequivocably “non-obvious” tangible vendible product, but it doesn’t deserve a patent on it. The European 101 filter might now let more through than the US 101, but at least Europe has an effective 103 filter that cuts out the cr8p. How’s the US 103 filter, when it comes to that lottery ticket. No TSM, is there?

  81. “The *how* is key because unless the recited *how* achieves something that an ordinary programmer would not have expected to work, the claim is dead. This is the 101/103 squeeze. Feel the python.”

    Sorry, Malcolm, you are off-base on software patents, at least the software patents that matter. Nobody (or nobody with any sense) is writing claims to novel ways to add 3 numbers together. But there are lots of novel (and non-obvious) claims out there directed to specific processes for manipulating data that are tied to real world things, which processes are implemented on a computer. The Federal Circuit mentioned Abele as an example. Your “ordinary programmer” is not the PHOSITA in these cases, and the test is certainly not whether the ordinary programmer would expect the process to work.

    That said, I’m out of here. All of this gnashing of teeth is a bit pointless.

  82. The general tenor of the opinion leaves much to be desired, especially in the realm of specific rules for software – e.g. are all software related claims (or computer-readable means or computer-readable medium) claims patentable because they are all “tied” somehow to a machine or apparatus (the first prong of the machine-or-transformation test). A lot of language along the lines of “the appropriate test will be developed when the time comes” for software or related technology.

  83. “What many amici argued for was allowing for a broad view of what is patentable subject matter, and letting 102/103 “take out the trash.”

    Why would anyone expect that approach to suddenly start working? Were those same amici filing briefs in KSR urging the Supremes to get rid of the strict TSM test?

  84. “Whew, I disagree with this. Back to normal. The question wasn’t whether a claim on a general purpose computer programmed to do something is patentable. The question is, what sort of general purpose computer can a process be tied to to pass this Bilski test? ”

    I guess my point was that “the question” is moot. It doesn’t matter what kind of “a computer” you stick into Bilksi’s claims unless the claim recites something very specific about that computer and *how* it does whatever it does. The *how* is key because unless the recited *how* achieves something that an ordinary programmer would not have expected to work, the claim is dead. This is the 101/103 squeeze. Feel the python.

  85. @Mooney:
    “‘a gp-computer configured to do X’

    This is unpatentable absent recitation of one or more algorithms or examples of source code that yield results that would surprise one skilled in the art of computer programming.

    It’s that simple.”

    To reemphasize MXL’s point to some degree, whether something “yield[s] results that would surprise one skilled in the art of computer programming” is an obviousness inquiry, not section 101. Thus, the inclusion of a gp-computer may be enough to clear the threshold of 101 (as a “particular machine,” or under the transformation prong with respect to other limitations), even if it gets struck down as obvious. What many amici argued for was allowing for a broad view of what is patentable subject matter, and letting 102/103 “take out the trash.”

  86. “Does anyone have a copy of the application? It’s unpublished, but it was referenced in published application 10/108,089 (see paragraph [0003]). It should be available under 37 CFR 1.14(vi).”

    Go to google patents and type in the application number.

  87. Does anyone have a copy of the application? It’s unpublished, but it was referenced in published application 10/108,089 (see paragraph [0003]). It should be available under 37 CFR 1.14(vi).

  88. Judge Rader is right that the test should be left at natural law, natural phenomena, and abstract ideas. However, he is wrong that Bilski claims an abstract idea. Bilski claims a real world, useful risk hedging method. It may be obvious, but that is another question entirely.

    The problem here is that the court can read the winds of popular sentiment like everyone else and, therefore, knows that it has to find Bilski’s invention ineligible subject matter. The problem, of course, is how to do it.

    Michel dreamed up the theory that the claim covers trading legal rights in the form of options and, therefore, does not transform an article. That’s all fine and dandy, except we have no idea going forward how to determine what is an acceptable transformation or an acceptable article. This will end up much like the obscentity cases of yesteryear (“I know it when I see it”) and the Fed Cir will get all of these questions dumped into its lap.

    Rader would like to just dismiss Bilski as an abstract idea. As I already stated above, it isn’t. Holding that it is does nothing more than confuse things further.

  89. The dissents make much more sense than the holding of “for now, let’s tie things to machines or transformations and hope the Supremes leave us alone this time” How wishy-washy can one get in the holding that puts us back into the 1800s :

    Thus, we recognize that the Supreme Court may ultimately decide to alter or perhaps even set aside this test to accommodate emerging technologies. And we certainly do not rule out the possibility that this court may in the future refine or augment the test or how it is applied. At present, however, and certainly for the present case, we see no need for such a departure and reaffirm that the machine-or-transformation test, properly applied, is the governing test for determining patent eligibility of a process under § 101.

  90. So let me see if I read it right:
    The Supremes said this is not the only test, but we are nonetheless going to treat it as if it were. Here are some reasons that the Supremes might want to reconsider the test. We leave it to them to reconsider. Now here it is applied in some awkward ways where it doesn’t really work well.

    Maybe they could have been more concise and just said:
    We decline to act until the Supremes tell us what to do.

  91. Did this decision just invalidate the vast majority of software patents?

    The court read Benson as saying that a process used with a computer is only patentable under the first prong if the process has utility outside of its use with the computer (page 13). How many software algorithms have utility divorced from a computer?

    Maybe software algorithms can be salvaged if they are tied to particular data (CT images is apparantly one type of date). However, if the software is useful with any type of data, I guess you are out of luck.

  92. The Bilski opinions (majority, concurring, and dissenting) are a mind-numbing 132 page concoction that leaves the concept of patentable subject matter, already confused by prior court decisions, even more confusing. I suspect that Chief Judge Michel’s majority opinion (machine or transformation) was an effort to find consensus, but it’s pretty obvious there’s no consensus here.

    Frankly, I’m with Judge Rader on this one: just treat the Bilski method as an “abstract idea” (or as “abstract reasoning”) and let it go at that. Or adopt Judge Newman’s approach (as Professor Michael Risch has suggested) and stop using 35 USC 101 as a way to screen out this type of subject matter (unless it’s truly covering just a “law of nature, natural phenomena, abstract idea, algorithm” or something equivalent), and instead use 35 USC 112, 102, and 103 to screen such subject matter on the merits. This “machine or transformation” test is not going to be any more easy to apply, and frankly Bilski could simply recast the claims in a more “machine-like” (e.g., computerized) form a la Diehr, and finesse this whole issue.

    As JJL correctly points out, the real culprit here is SCOTUS, and their nonsensical reasoning in Benson and Flook. Flook is really bad as it treats a previously unknown “algorithm” as part of the prior art for 35 USC 103 purposes. Diehr is possibly a recognition by SCOTUS that they may have gone too far down the “law of nature, natural phenomena, abstract idea” path, but we’re still stuck with the bizarre precedent created in Benson and Flook.

    Judge Mayer’s opinion is astounding for its ignorance. May be he wants to go back to “methods of doing business” being unpatentable but it’s too late now. Congress has already enacted “prior user rights” as a defense against so called “business method patents,” thus recognizing them as fact (and patentable subject matter). Also, Mayer’s reference to Justice Kennedy’s nauseous, ill-advised, and unnecessary concurring opinion in eBay about “business method patents” doesn’t hold much credence with me.

  93. jk:

    The court explicitly did not decide that issue.

    “We leave to future cases the elaboration of the precise contours of machine implementation, as well as the answers to particular questions, such as whether or when recitation of a computer suffices to tie a process claim to a particular machine.”

  94. I believe there’s a statement in Alappat saying that a general purpose computer, once programmed for a particular task, becomes a special purpose computer. Which, in reality, is just another way of saying all computers are special purpose machines when applied to some task.

  95. “A particular machine” can’t be a general purpose computer.

    But it can be two general purpose computers that communicate with one another, apparently because there is a “real world output” of “stuf” going on during the interchange of information.

    At the moment, I’m just making sure to recite storing something in a computer readable medium or outputting something by at least one of a user interface or data link. What have you.

    But I really thing that a general purpose computer is as much a particular machine as a manufacturing plant that can be reconfigured to make different things. And if the computer performs a process, it inherently accesses RAM and stores data there during the process by affecting transformations in the physical memory. I think we just need a ruling that the real world output is inherent.

  96. “”a gp-computer configured to do X”

    This is unpatentable absent recitation of one or more algorithms or examples of source code that yield results that would surprise one skilled in the art of computer programming.

    It’s that simple.”

    Whew, I disagree with this. Back to normal. The question wasn’t whether a claim on a general purpose computer programmed to do something is patentable. The question is, what sort of general purpose computer can a process be tied to to pass this Bilski test? Since every so-called “general purpose” is programmed when it’s used in a process, I’d argue that any computer counts as a “particular machine.” Would that pass? No idea because Bilski doesn’t say. Too bad Bilski admitted his claim doesn’t involve any machines so Fed Cir would have said something about that.

  97. Aw,

    I am re-posting Patent Agent’s post from another thread as it seems germane here:

    “Haven’t courts already denied this line of logic from the PTO (general purpose computer vs. particular computer)? as cited in In re Lowry, In re Bernhart and Fetterer states:
    There is one further rationale used by both the board and the examiner, namely, that the provision of new signals to be stored by the computer does not make it a new machine, i.e. it is structurally the same, no matter how new, useful and unobvious the result. . . . To this question we say that if a machine is programmed in a certain new and unobvious way, it is physically different from the machine without that program; its memory elements are differently arranged. The fact that these physical changes are invisible to the eye should not tempt us to conclude that the machine has not been changed. Bernhart, 417 F.2d at 1400.”
    Posted by: Patent Agent | Oct 30, 2008 at 12:45 PM

    link to patentlyo.com

  98. JK:

    I believe “a particular machine” can be any machine as long as its use does not constitute mere “insignificant postsolution activity”.

  99. I’m about to agree with Malcolm, and that makes my head hurt almost as much as reading Diehr and Flook, but here goes.

    The problem with the Lab Corp claim was that it involved taking the results of an assay and thinking about it. Lets even assume that the combination was totally new, novel, non-obvious, etc. The claim isn’t seeking to protect the assay (which is in the prior art). The claim is seeking to protect something you do with the assay, and that thing you do CAN be entirely mental but still infringe the claim. That’s the problem.

  100. “a gp-computer configured to do X”

    This is unpatentable absent recitation of one or more algorithms or examples of source code that yield results that would surprise one skilled in the art of computer programming.

    It’s that simple.

  101. JK:

    “A particular machine” can’t be a general purpose computer.

    Why the heck not? What the heck is a “general purpose computer” anyway? Just about any computer can be reprogrammed to do other things, does that make it “general purpose”?

  102. “The issue becomes whether combining the law of nature with the steps of assaying/correlating would have been obvious to a PHOSITA”

    That might be the issue if the claim wasn’t in fact asserted by the patentee to cover the mental process of **thinking** about the results of an old assay. You can not address Breyer’s dissent in Lab Corp. while ignoring this crucial fact. There are two crucial facts in Lab Corp. This mental step issue is one of them. The other is that the assay itself was old.

    The focus on the “law of nature” is a red herring. The “law of nature” prong of 101 is easy to deal with. You can’t write a claim that says “I claim the law of nature, wherein blah blah blah.” That’s it.

    Remember that every composition of matter and method that actually does something tangible in the real world (i.e., other than merely producing information to be stored only in a practitioner’s brain) combines old steps and old compositions with one or more “laws of nature.” That’s a trivial point and it’s not the point Rader is making. Rader simply doesn’t remember the facts at issue in Lab. Corp. Judge Breyer did.

  103. “You can’t make an old assay patentable merely by adding a **mental step** of interpreting the assay in light of new information.

    That isn’t an obviousness issue. It’s a 101 issue.”

    Plus, it is a new use of patentable subject matter. It does not matter that it was an old process. The new use does not have to be tied to a particular machine or transform physical subject matter.

  104. “You can’t make an old assay patentable merely by adding a **mental step** of interpreting the assay in light of new information.

    That isn’t an obviousness issue. It’s a 101 issue.”

    But you can make a new mental step patentable by adding a restriction to include performance of an old process that was patentable subject matter. That’s the point.

  105. Isn’t this type of highly arcane analysis by the majority just what the Supreme Court has been beating down every time a Federal Circuit decision is up for review? The Federal Circuit, due to its limited subject-matter jurisdiction, once again lost the forest for the trees. I’d bet my two cents that the Supreme Court would agree with Judge Rader. Hopefully, the Supremes will have that opportunity.

    Totally unlikely. After Lab Corp and other cases, I’d be shocked if they came down on Rader’s side. Mayer’s side, maybe. Whether the Fed Cir screwed this one or not though, I have to admit that the bed was in large part made by the Supreme Court. Reading Diehr, Flook, Benson, and others makes me want to puke.

  106. Isn’t this type of highly arcane analysis by the majority just what the Supreme Court has been beating down every time a Federal Circuit decision is up for review? The Federal Circuit, due to its limited subject-matter jurisdiction, once again lost the forest for the trees. I’d bet my two cents that the Supreme Court would agree with Judge Rader. Hopefully, the Supremes will have that opportunity.

  107. Malcolm, I disagree. I believe that Rader implies that laws of nature and natural phenomena are already prior art. He states the following:

    “Natural laws and phenomena can never qualify for patent protection because they cannot be invented at all. After all, God or Allah or Jahveh or Vishnu or the Great Spirit provided these laws and phenomena as humanity’s common heritage.”

    Therefore, the law of nature discovered by the scientists in LabCorp is prior art applicable in a 103 analysis. The issue becomes whether combining the law of nature with the steps of assaying/correlating would have been obvious to a PHOSITA.

  108. “So a patentee cannot even now argue that it was not obvious to use a computer to perform the steps of the process.”

    Respectfully, when was it NOT obvious to “use a computer” to perform steps that could otherwise be performed mentally? Even the experts here agree that everything computer-based is fully enabled. So what are the unexpected results of “using a computer” or “using the internet” or “using a robot” to do something?

    This whole debacle was created by a lax troll-promoting culture that thrived in the PTO and Silicon Valley. Reap the whirlwind, folks.

  109. “I believe Rader’s point is that the step of assaying AND correlating is patentable subject matter.”

    That may be Rader’s point but he is choosing the wrong set of facts to make his point. You can’t make an old assay patentable merely by adding a **mental step** of interpreting the assay in light of new information.

    That isn’t an obviousness issue. It’s a 101 issue.

  110. So, we still don’t know if the words “computer-implemented” method is enough to overcome the “tied to a particular machine” test.

    Great.

  111. The court seems to strengthen Comiskey. Comiskey suggested that a purely mental process was not patentable under 101, and that merely adding a computer was prima facie obvious under 103. Here, in FN26, the court seems to say that such an addition of a computer is actually a 101 issue. So a patentee cannot even now argue that it was not obvious to use a computer to perform the steps of the process.

    EM

  112. “And so begins the slide down that slippery slope to end patenting of new technological arts.”

    Not at all. On the contrary, the patenting of new technological arts will greatly benefit from decisions like this, for the reasons given in Judge Mayer’s dissent (among others). Of course, patenting in arts such as “making a profit” and “a computer-based method of doing something that is old in the art” may decline.

    But the only people who will suffer from that decline are a few patent prosecutors and trolls. As a whole, the American public will not suffer at all from the change. On the contrary.

  113. Malcolm Mooney said:
    “Dude totally misreads the LabCorp dissent. In fact, the “claimed process for assaying a patient’s blood” that Rader refers to was old in the art. The “new” aspect of the claim was the “new” information (i.e., the abstract idea) that high homocysteine levels were correlated with low folate levels. Rader forgets that the patentee in LabCorp asserted that the claims could be infringed merely by THINKING about the correlation. If that isn’t equivalent to patenting an abstract idea and precluding others from using the relationship, then what is?”

    I believe Rader’s point is that the step of assaying AND correlating is patentable subject matter. Issues of obviousness are controlled by a different section of the statute and are not a 35 USC 101 issue. One should allow those other parts of the Act to take care of situations like that presented in LabCorp.

  114. And so begins the slide down that slippery slope to end patenting of new technological arts. A reactionary and retrograde ideology has taken hold of the courts. We move not boldly forward into the future but rather backwards toward the mindset of 1776 whence equality was an “abstract” concept and not intended to be applied practically to beings of human form.

  115. “We leave to future cases the elaboration of the precise contours of machine implementation, as well as the answers to particular questions, such as whether or when recitation of a computer suffices to tie a process claim to a particular machine.”

    I can answer those questions right now.

  116. Rader blows it in his dissent:

    “A patient may suffer from the unpatentable phenomenon of nature, namely high homocysteine levels and low folate. But the invention does not attempt to claim that natural phenomenon. Instead the patent claims a process for assaying a patient’s blood and then analyzing the results with a new process that detects the life-threatening condition. Moreover, the sick patient does not practice the patented invention. Instead the patent covers a process for testing blood that produces a useful, concrete, and tangible result: incontrovertible diagnostic evidence to save lives. The patent does not claim the patent ineligible relationship between folate and homocysteine, nor does it foreclose future inventors from using that relationship to devise better or different processes.”

    Dude totally misreads the LabCorp dissent. In fact, the “claimed process for assaying a patient’s blood” that Rader refers to was old in the art. The “new” aspect of the claim was the “new” information (i.e., the abstract idea) that high homocysteine levels were correlated with low folate levels. Rader forgets that the patentee in LabCorp asserted that the claims could be infringed merely by THINKING about the correlation. If that isn’t equivalent to patenting an abstract idea and precluding others from using the relationship, then what is?

    Very disappointing effort by Rader. Don’t these guys have proofreaders?

  117. Two parts in context tell much of the story:

    “We leave to future cases the elaboration of the precise contours of machine implementation, as well as the answers to particular questions, such as whether or when recitation of a computer suffices to tie a process claim to a particular machine.”

    and Rader’s dissent:
    In sum, this court today invents several circuitous and unnecessary tests. It should have merely noted that Bilski attempts to patent an abstract idea. Nothing more was needed. Instead this opinion propagates unanswerable questions: What form or amount of “transformation” suffices? When is a “representative” of a physical object sufficiently linked to that object to satisfy the transformation test? (e.g., Does only vital sign data taken directly from a patient qualify, or can population data derived in part from statistics and extrapolation be used?) What link to a machine is sufficient to invoke the “or machine” prong? Are the “specific” machines of Benson required, or can a general purpose computer qualify? What constitutes “extra-solution activity?” If a process may meet eligibility muster as a “machine,” why does the Act “require” a machine link for a “process” to show eligibility? Does the rule against redundancy itself suggest an inadequacy in this complex spider web of tests supposedly “required” by the language of section 101?

  118. At least Judge Mayer gets it. Slowly but surely the wheel will turn …

    MAYER, Circuit Judge, dissenting:

    The en banc order in this case asked: “Whether it is appropriate to reconsider State Street Bank & Trust Co. v. Signature Financial Group, Inc., 149 F.3d 1368 (Fed. Cir. 1998), and AT&T Corp. v. Excel Communications, Inc., 172 F.3d 1352 (Fed. Cir. 1999), in this case and, if so, whether those cases should be overruled in any respect?” I would answer that question with an emphatic “yes.” The patent system is intended to protect and promote advances in science and technology, not ideas about how to structure commercial transactions. Claim 1 of the application of Bernard L. Bilski and Rand A. Warsaw (“Bilski”) is not eligible for patent protection because it is directed to a method of conducting business. Affording patent protection to business methods lacks constitutional and statutory support, serves to hinder rather than promote innovation and usurps that which rightfully belongs in the public domain. State Street and AT&T should be overruled.

  119. We further reject calls for categorical exclusions beyond those for fundamental principles already identified by the Supreme Court.22 We rejected just such an exclusion in State Street, noting that the so-called “business method exception” was unlawful and that business method claims (and indeed all process claims) are “subject to the same legal requirements for patentability as applied to any other process or method.” 149 F.3d at 1375-76. We reaffirm this conclusion.23

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