Blog post

Bilski Blowback Begins

By Brian Prentice | March 22, 2009 | 2 Comments

The Future of Ownership - IP & IT Industry

Call it a sickness if you like but I actually enjoy reading amicus curiae! These are documents filed in a legal proceeding by an interested party who is not directly part of the case. Not only are they usually far more readable than court rulings they also offer a fascinating window into the thinking of the people and organizations that help shape the opinions of those in the judiciary and the legislature.

Last year’s landmark Bilski case saw a number of amicus curiae submitted to the CAFC most of which were largely in favour of doing something to curtail, if not eliminate, business methods as patentable material. Well, those parties got what they wanted. But I don’t think most were expecting the solution that the court ultimately came up with.

Rather than rule one way or the other on the patentability of business methods the court established a new “particular machine or transformation” test . That decision, in my opinion, has only made the whole issue an ambiguous mess. Especially since they ducked the question of whether a general purpose computer is a “particular machine” and the extent to which the Patent & Trademark Office will interpret the new test seems to be a work in progress.

Now Bilski is appealing this decision to the Supreme Court. In support of that appeal, a new set of amicus curiae have been submitted. Not only do these provide some powerful arguments against the CAFC’s decision but they provide a more balanced view of business method patents that were largely absent in the Bilski amicus curiae submissions.

As I read through these I found a number of consistent themes. The first of these is that Bilski introduces rigidity into a patent system always intended to be flexible. Consider these comments from Accenture and Pitney Bowes:

Throughout its patent law decisions, this Court has favored flexible, common-sense approaches over rigid, unbending rules….Bilski is yet another example of the Federal Circuit departing from this Court’s established, flexible approach in favor of a rigid, bright-line rule.

Furthermore, that rigidity is bound to a period where innovation largely had a physical manifestation. This issue, in my opinion, is of paramount importance to those of us in the IT industry. This is best expressed in the comments by the American Intellectual Property Law Association:

As technology thus ventures from the recognized into the unknown, innovation should be no less protectable than in previous eras of
transition….Regrettably, this test is derived from and tied to the vocabulary of technologies developed in earlier ages, and thus is backward-looking and ill-fitted to future discoveries and technologies as yet unimagined.

This “machine-era” approach also has significant consequences across a range of different industries. As Philips states:

The scope and fallout of the Bilski decision are not limited to methods of doing business….Processes claims are often seen as the only means to achieve effective patent protection for important inventions in medical, diagnostic, environmental control and information science technologies. The holding below thus inherently discriminates against industry sectors.

Or, more specifically, here are comments from biotech company Medistream:

Bilski casts a cloud of uncertainty as to whether Medistem and other biotech companies can continue to protect with patents their inventions relating to methods of diagnosing causes of diseases and methods of selecting beneficial treatment protocols … The question of whether potentially life-saving diagnostic methods or treatments should be ineligible for patent protection if they are not tied to a particular machine or apparatus, or do not transform a particular article into a different state or thing, has great importance to our citizens.

For those who thought that Bilski closed the door on business method and software patents I’d suggest that there still some way to go on the issue.

[disclaimer- much to my Mother’s disappointment I am not an attorney. These are my personal views and should not be considered legal opinion]

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2 Comments

  • Wayne says:

    OK, so you aren’t an attorney. You aren’t a technologist either. I am.

    A while back I did an evaluation on issued patents, specifically I was looking into allegations that there were problems with the US patent system. This involved reading the regulation, and then applying it to patents that the USPTO had issued. Much to my shock 95% of the patents I studied were invalid according the the regulation that governs the patent office. The other 5% of patents may or may not have been invalid, they were beyond my ability to evaluate.

    Obviousness was a huge issue. The other issue was incomplete description of the invention (it would have been impossible for a person skilled in the art to build the invention from the description). Also much to my surprise I found several “inventions” that were physically impossible (and thus not patentable).

    If I am correct that 95% of the patents issued by USPTO are technically invalid, the implications are staggering (I am sure that I am, but you may not be) for the American economy. The current recession will be excaberated by the drag of false patents on the economy.

  • Wayne – thanks for your comments (with the exception of the needless ad hominem baiting).

    If your key point is that there are problems with the patent system then we are in complete agreement. While I haven’t done such an exhaustive analysis of software patents, my experience would concur with your findings. There are a lot of software patents that are not novel and are obvious. And since this post is about the Bilski decision (which was not about software patents) let’s keep in mind that Justice Rader, in his dissent, felt that Bilski patent could simply have been dealt with on the basis that it was obvious.

    I think you also raise an interesting point in relationship to the recession. While I wouldn’t frame this problem as “staggering” there is some interesting research which was done by Innography that correlated an increase in infringement actions with recessions. At a minimum, the cost of dealing with poor patent grants will increase at exactly the time we don’t need that to happen (although the legal industry will be thankful for the economic stimulus 😉 )

    However, if your argument is that the number of poor quality software patents means that software should not be patentable material than I will have to respectfully disagree with you. Systemic issues that lead to poor quality patents is a specific problem that needs to be addressed separately from a discussion on merits of software as patentable material.