The Times They Are A'Changing (Again)

Submitted by patentadmin on Thu, 11/13/2008 - 10:07

For a long time (actually until 1998), “methods of doing business” were legally deemed ineligible for patent protection. Then came the decision of the Court of Appeals for the Federal Circuit (C.A.F.C.) in State Street Bank, which held that “business methods” are patentable subject matter.

The State Street Bank decision resulted in the issuance of patents directed to all manner of processes or methods with little or no technological content. Although immensely popular with inventors, such patents drew the ire of much of the business community (mostly those businesses accused of infringement). The stage was thus set for a judicial re-evaluation of the standard or test for patentable subject matter.

This re-evaluation was effected by the long-awaited (at least by patent attorneys) Bilski decision. Now, the C.A.F.C. has held that methods or processes cannot be patented unless they are tied to a specific machine or involve a physical transformation of a particular article into a different state or thing. The transformed articles must be “physical objects or substances [or] representative of physical objects or substances.”

The C.A.F.C. took great pains (and many pages of its decision) to point out that its newly enunciated standard is in accord with Supreme Court precedent. Thus, it is not likely to be overturned. Nevertheless, much litigation will likely ensue before it is clear (if it ever is) what e.g. constitutes “representative of physical objects or substances.”

In the meantime, your business method patent is probably not worth as much today as it was a month ago (for that matter, after looking at the stock market indices, what is?).

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