Through the Fuzzy Bilski Looking Glass: The Meaning of Patent-Eligible under 35 U.S.C. § 101
|Written by Eric W. Guttag
Eric W. Guttag IP Law Office
Posted: July 22, 2010 @ 6:38 pm
In Chapter 6 of Lewis Carroll’s Through the Looking Glass, Humpty Dumpty tells Alice scornfully “when I use a word, it means just what I choose it to mean – neither more nor less.” After reading and compositing the various opinions by the nine SCOTUS Justices in USPTO v. Bilski, I, like many others, are still wondering what is a patent-ineligible “abstract idea” (other than Bilski’s claimed method for instructing buyers and sellers how to protect against the risk of price fluctuations in a discrete section of the economy, i.e., hedge against such risks) and especially what does “patent-eligible” really mean under 35 U.S.C. § 101. The composite opinions by SCOTUS in Bilski concoct a standard for patent-eligibility that is as fuzzy and circular as the logic Humpty Dumpty employed on Alice.
As you might imagine, there are many takes on what the SCOTUS Bilski ruling actually says, including mine. See Section 273 is NOT a Red Herring: Stevens’ Disingenuous Concurrence in Bilski where I waxed lyrical about now retired Justice Stevens’ disingenuous sophistry in his concurrence which treats 35 U.S.C. § 273 as if it didn’t exist, but which is, in fact, an implicit, if not explicit, recognition and acceptance by Congress that “business methods” (however you characterize them) ARE patent-eligible subject matter under 35 U.S.C. § 101. See also Foaming at the Mouth III: And Then Came Bilski where I commented on the most recent “thunderbolt” from our Judicial Mount Olympus as SCOTUS summarily granted certiorari in Prometheus Laboratories, Inc. v. Mayo Collaborative Services and Classen Immunotherapies, Inc. v. Biogen Idec, and then vacated and remanded both cases to the Federal Circuit to reconsider (with equally “fuzzy” guidance) in light of SCOTUS’ ruling in Bilski.
The complicating factor in what Bilski means regarding the standard for patent-eligibility under 35 U.S.C. § 101 is that there are at least three different opinions (actually four if you count Scalia’s refusal to join Parts II B-2 and C-2 of Kennedy’s opinion for the Court). Even so, I see five key “takeaways” from the composite ruling:
1. The “machine or transformation” (M or T) test is not the sole test for patent eligibility under 35 U.S.C. § 101 (by a 9-0 vote). The “M or T” test, while still valid, has been relegated to “second class” status as too inflexible, much like the “teaching, suggestion and motivation” (TSM) test in KSR International v. Teleflex. That’s the easiest and clearest “takeaway.”
2. At least some “business methods,” however defined, remain patent-eligible under 35 U.S.C. § 101 (by a 5-4 vote). A majority of SCOTUS Justices (based on Scalia joining Part C-1 of Kennedy’s opinion of the Court) agree that 35 U.S.C. § 273 (which provides a “prior user right” defense to infringement of patented “business methods”) confirms that at least some “business methods” are patent-eligible subject matter (e.g., are a “process”) under 35 U.S.C. § 101.
3. “Abstract ideas,” however defined, remain patent-ineligible under 35 U.S.C. § 101 (by a 9-0 vote). Another clear “takeaway.” But as noted above, what constitutes an “abstract idea” is not defined or is ambiguously defined by SCOTUS’ composite opinions. Given Kennedy’s reference in Part III of the Court’s opinion to the Bilski method as “adding even less to the underlying abstract principle than the invention in” Parker v. Flook (which was characterized by the Court’s opinion as involving a “mathematical formula”), any claim that is deemed to cover subject matter that is analogous to that in Flook (i.e., a “mathematical formula,” or an “algorithm” as the invention in Flook more specifically related to) will be considered a patent-ineligible “abstract idea.”
4. The patent-eligible status of computer programs or software under 35 U.S.C. § 101 may be up in the air but there are subtle signs that a majority of SCOTUS would consider computer programs/software to still be patent-eligible (by a 4-4-1 vote). This is based on Scalia’s refusal to join Part II B-2 of the Kennedy’s opinion for the Court. What is unclear is exactly what in Part II B-2 Scalia disagreed with. In Part II B-2, Kennedy specifically references Stevens’ dissenting opinion in Diamond v. Diehr (“well-established principles of patent law probably would have prevented the issuance of a valid patent on almost any conceivable computer program”), and then says: “But this fact does not mean that unforeseen innovations such as computer programs are always unpatentable (referring to the majority opinion in Diehr).” Assuming that Scalia’s refusal is based on the “broader premise” set out in Part II B-2 of Kennedy’s opinion for the Court (not specifically directed to computer programs/software), and that, like his implicit (if grudging) acknowledgment that 35 U.S.C. § 273 mandates that “business methods” are patent-eligible under 35 U.S.C. § 101, Scalia may have also (perhaps grudgingly) conceded that at least some computer programs/software inventions are patent-eligible under 35 U.S.C. § 101 in view of the majority holding in Diehr. It remains to be seen how this will play out as Stevens has stepped down from SCOTUS, and exactly how the Federal Circuit will construe the impact of Part II B-2 of the Court’s opinion in view of Scalia’s refusal to join it.
5. The expansive view of patent-eligible subject matter taken by SCOTUS in Diamond v. Chakrabarty may have been undercut somewhat, and the even more expansive “tangible, concrete and useful result” view of the Federal Circuit in State Street is likely dead (by a 5-4 vote). The SCOTUS majority in Chakrabarty said that “anything under the sun made by man” may be patent-ineligible under 35 U.S.C. § 101, which is at least implicitly acknowledged in Part II A of the Court’s opinion where Kennedy refers to Chakrabarty for the proposition that Congress intended the categories of 35 U.S.C. § 101 to “be given a wide scope.” Parts III and IV of Stevens’ concurring opinion (actually a partial dissent from the Court’s opinion which three other Justices joined) directly challenges Kennedy’s view. In addition to Scalia refusing to join Part II B-2 and C-2 of the Court’s opinion which support a more expansive view of patent-eligible subject matter, Scalia also joined Breyer’s concurrence (again a partial dissent from the Court’s opinion). Breyer’s concurring/partial dissenting opinion refers explicitly to his dissent in Laboratory Corp. v. Metabolite Laboratories, Inc. which essentially takes a much more restrictive view of what is patent-eligible subject matter, and also directly refutes the “useful, concrete, and tangible result” view of the Federal Circuit’s State Street Bank & Trust Co. v. Signature Financial Group, Inc. Given Scalia’s refusal to join Part II B-2 and C-2 of the Court’s opinion and his joining of Breyer’s concurring/partial dissenting opinion (which directly challenges the much more expansive view in State Street already rejected by a majority of the Federal Circuit in Bilski), a majority of SCOTUS in Bilski appears to have taken a much more restrictive view of patent-eligible subject matter under 35 U.S.C. § 101 compared to what was held in Chakrabarty, and has also likely dealt a “death blow” to the even more expansive “useful, concrete, and useful result” view in State Street.
So now what does SCOTUS’ ruling in Bilski “really” mean to us “mere mortals”? First, we’ve got two “wild cards” to deal with as noted above: (1) Stevens has retired; and (2) what does Scalia’s refusal to join Parts II B-2 and C-2 of Kennedy’s opinion for the Court signify. Some aspects of “wild card” #2 are dealt with above, but as also noted, there are still some aspects which are unclear or at least ambiguous as to how this refusal by Scalia should be viewed. This lack of clarity/ambiguity will require some sorting out by the Federal Circuit, which may come as early as the reconsideration by the Federal Circuit of Prometheus, Classen, or even the appeal in AMP v. USPTO involving the gene patenting controversy. In AMP, District Court Judge Sweet’s invalidity ruling regarding the method claims for determining a pre-disposition to breast/ovarian cancer using the BRCA1 and BRCA2 genes relies at least in part upon the “M or T” test which, as noted above, SCOTUS unanimously relegated to “second class” status in Bilski as not the only test for patent-eligibility.
So here’s my “realistic” appraisal of how to approach what remains patent-eligible after Bilski:
a. To avoid the “abstract idea” patent-ineligible “zone,” define the process/method/system to be more machine/computer-implemented and/or to be more manipulative (transformative) of items/data. While SCOTUS’ ruling in Bilski said the “machine or transformation” test isn’t the sole way to determine patent-eligibility, that test still points to a way for avoiding the “abstract idea” patent-ineligible “zone.” That’s what SCOTUS’ majority ruling in Diehr actually says and is entirely consistent with SCOTUS’ composite ruling in Bilski. The more the process/method/system is tied to machine/computer implementation and/or the more the process/method/system manipulates (i.e., transforms) objects, compounds, even data/information, the more likely it will be treated as patent-eligible. Also, avoid vexing over whether the claimed process/method/system will be considered to be a “business method.” SCOTUS’ composite ruling in Bilski says that at least some “business methods” are patent-eligible, so worrying about whether (or not) the process/method/system is (or is not) a “business method” won’t normally help.
b. Still pursue patent claims computer programs/software, but also include at least some claims that carefully tie the program/software to machine/computer implementation. It is, at most, ambiguous how the composite SCOTUS rulings in Bilski treated the patent-eligibility of computer programs/software inventions, so I recommend continuing to pursue such patent claims, but crafted carefully to avoid simply reading on an “algorithm.” The only thing that is clear in this regard from the composite SCOTUS rulings in Bilski is that you cannot simply claim the “algorithm” (that’s what SCOTUS said, in essence, you can’t do in Flook which is mentioned repeatedly in Bilski). And unless SCOTUS overrules its majority opinion in Diehr (also discussed repeatedly in Bilski), or the Federal Circuit decides to go in a different direction (which is hopefully unlikely), tying the program/software to a machine/computer implemented process/method/system should keep it patent-eligible.
c. Medical diagnostic process/method patent claims should still be pursued, but be careful in relying exclusively upon comparison/correlation patent claims. What I mean by “comparison/correlation patent claims” are those which typically involve a first step of gathering/analyzing data, and then comparing/correlating in a second step that gathered/analyzed data to a “bench mark” value to see if, for example, a certain medical condition exists or there is potentially a predisposition to such a medical condition. This issue was left unresolved by SCOTUS in the Laboratory Corp. case, and the Federal Circuit has taken what I consider conflicting views (after its own Bilski ruling) as to whether (and when) such comparison/correlation patent claims are patent-eligible. Compare Prometheus (drug dosage calibration patent claims are “transformative” and therefore patent-eligible) with Classen (with no/minimal explanation, claimed method for essentially calibrating an immunization schedule for a treatment group, relative to a control group is patent-ineligible in view of Federal Circuit’s Bilski). How the Federal Circuit will try to reconcile Prometheus and Classen, as well as AMP, in view of SCOTUS’ “fuzzy” ruling in Bilski is anyone’s guess. For now, I recommend still trying to go for such comparison/correlation patent claims, but also try to have at least some other patent claims which define the method/process as actually “diagnosing” a specific disease state (at minimum), and/or suggesting/providing a particular course of treatment (preferably) based on that diagnosis; even these sorts of “diagnostic/treatment” claims might not pass muster when the Federal Circuit applies SCOTUS’ “fuzzy” ruling in Bilski because they may involve patent-ineligible “post-solution” activity.
That’s my view through the looking glass for what to do now in these uncertain Bilski times. I’m sure there will be disagreements with what I’ve said or suggested, just like the various SCOTUS Justices who couldn’t come to a consensus on what is the standard is for patent-eligibility. Like Alice, we “mere mortals” may still find ourselves looking through a “fuzzy” looking glass in trying to decipher what the composite SCOTUS ruling in Bilski means for what is or remains patent-eligible under 35 U.S.C. § 101. The best we can do for now is give advice (and take action) that remains flexible enough to go whichever way the Federal Circuit bends (or retreats) as it considers future cases involving patent-eligibility under 35 U.S.C. § 101, especially the Prometheus, Classen and AMP cases. This trio of cases may soon gives us a glimmer of hope (or yet more despair) on how to view the “fuzzy” looking glass called Bilski.
© 2010 Eric W. Guttag
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