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PATENTS FOR BUSINESS METHODS
(REVISED)
The Court of Appeals for
the Federal Circuit (last stop
before the Supreme Court) ruled that
a process, i.e., method of
performing a function, could be
patentable if the process included
use of a machine or there was a
resulting transformation of a
particular article into a different
state or thing. Keep in mind this
standard pertains to whether a new
process is patentable subject
matter (statutory subject matter
under 35 U.S.C. Section 101). There are the separate
tests of whether the development is
novel or whether the development
would be obvious to a person skilled
in the art. Note also that the
use of the machine or transformation
of the state or thing can not be
merely an "add-on" to an otherwise
ineligible claim.
What this Court decision
signifies is a pulling back on the
patentability of business methods.
For example, it is unclear whether a
standard computer processing unit
(CPU) constitutes a machine. Some
commentators have already expressed
the belief that the Court of Appeals
for the Federal Circuit has
indicated that a “general purpose
computer” is not a machine within
the meaning of the machine or
transformation test. A more
specialized computer (or computer
software?) must be used. The
alternative is to rely on the
transformation branch of the test.
Under the specific facts of the
recent case (In re Bilski) “the
transformations or manipulations
simply of public or private legal
obligations or relationships,
business risks, or other such
abstractions cannot meet the test
(machine or transformation test)
because they are not physical
objects or substances, and they are
not representative of physical
objects or substances. 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.”
Software remains patentable if part
of a process meeting the machine or
transformation test. The Court
adopted earlier rationale that the
transformation of data may be
sufficient. A physically
perceivable transformation of data
(computer display) may be an
example.
November 3, 2008
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