I have just received a copy of the United States Patent and Trademark Office’s first Memorandum to the Patent Examining Corps regarding the United States Supreme Court’s decision earlier today in Bilski v. Kappos. The memo was authored by Robert W. Bahr, Acting Associate Commissioner for Patent Examination Policy. This is the first communication to Patent Examiners, telling them what they should know about the decision and how to handle the thorny issues that will no doubt be presenting themselves. The memo concludes by explaining the the “USPTO is reviewing the decision in Bilski and will be developing further guidance on patentable subject matter eligibility under 35 U.S.C. § 101.” Ultimately, the USPTO is going to need to issue Bilski Guidelines, but that cannot be expected on day one right after the Supreme Court essentially eviscerated the machine or transformation test as has been used by Patent Examiners since the Fall of 2008 when the Federal Circuit issued its own decision in Bilski.
The memo sent to Patent Examiners briefly goes through the Supreme Court’s decision and wastes no time in getting to what will be music to the ears of patent attorneys and agents:
Significantly, the Supreme Court also indicated that a business method is, at least in some circumstances, eligible for patenting under section 101.
The memo goes on to explain:
Examiners should continue to examine patent applications for compliance with section 101 using the existing guidance concerning the machine-or-transformation test as a tool for determining whether the claimed invention is a process under section 101. If a claimed method meets the machine-or-transformation test, the method is likely patent-eligible under section 101 unless there is a clear indication that the method is directed to an abstract idea. If a claimed method does not meet the machine-or-transformation test, the examiner should reject the claim under section 101 unless there is a clear indication that the method is not directed to an abstract idea. If a claim is rejected under section 101 on the basis that it is drawn to an abstract idea, the applicant then has the opportunity to explain why the claimed method is not drawn to an abstract idea.
All things considered, this seems to be an essentially fair way to proceed, at least for the time being. I, however, disagree about whether those inventions that satisfy the machine-or-transformation test are patentable subject matter. According to this memo they are “likely patent-eligible.” I think any fair reading of the Bilski v. Kappos opinions would find that if a claimed invention satisfies the machine-or-transformation test then it is, in fact, patentable subject matter.
To be honest, I am likely splitting hair here, because taken together in its entirety it seems the “likely patent-eligible” could be read to mean “is patent eligible unless there is a clear indication that the method is directed to an abstract idea.” The trouble I am having is I cannot think of a situation where the machine-or-transformation test could be satisfied and an intellectually honest conclusion could be reached that the claimed invention is directed to an abstract idea.
Having said all of this, what lies in front of the United States Patent Office is an unenviable task of figuring out what the Supreme Court left unanswered, which is exactly what they had to do in KSR v. Teleflex, which lead to the compiling of comprehensive, and complicated, Obviousness Guidelines.
The difficulty with this Supreme Court decision, and the way in which they explain “figure it out PTO and lower courts,” is that they fail to appreciate the dreadful task of providing bright line guidelines to 6,000 plus Patent Examiners who are not lawyers and who have varying degrees of experience. In order for the Patent Office to manage its docket and its workforce there needs to be some kind of guidance given, and despite what the Supreme Court thinks that cannot be to tell the Examining Corps to take it on a case-by-case basis.
Who knows what will happen, but this early announcement form the USPTO seems helpful. They recognize that business methods are patentable unless they represent abstract ideas, as Bilski was determined to encompass. It is also recognized that satisfying the machine-or-transformation test is heavy evidence of satisfying the requirements of 101, and an interim process is put in place whereby the burden will be shifted to the applicant to demonstrate that the claimed invention is not simply drawn to an abstract idea if a machine-or-transformation rejection is given.
This seems reasonable to me, at least for now and until we can all digest the case better and figure out what the Supreme Court (1) said; and (2) what they meant, which are almost certainly two different things.