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<i>Online Exclusive:</i> A Big Day for Bilski and Warsaw

By ALM Staff | Law Journal Newsletters |
December 01, 2009

Sitting next to my clients Bernie Bilski and Rand Warsaw at the U.S. Supreme Court oral argument on Nov. 9, 2009, I wondered what the co-inventors were thinking as the Justices inquired about horse whispering, speed dating and tax evasion methods. While the implications of this case extend far beyond the claimed consumption risk management method, it may prove difficult to clearly draw new defining lines around patent eligible subject matter as outlined in Section 101 of the Patent Act. As the prognostications of potential outcomes for this case continue over the next several months, it may be wise to recognize that regardless of the outcome, there will always be some degree of uncertainty regarding the limits of patent eligibility. Consequently, the best corporate patent strategies should address and accommodate those uncertainties. While this article describes some of those possible strategies and perspectives, it is far from exhaustive and obviously does not necessarily represent the opinions of its author, his firm, or its clients.

The currently pending Bilski-Warsaw patent application was filed over 12 years ago in 1997 and claims a method for managing consumption risk costs in commodities trading that includes identifying market participants and initiating particular transactions. The Patent and Trademark Office (“PTO”) Examiner rejected the claims on the grounds that they merely manipulate an abstract idea without a specific apparatus, and are not directed to the technological arts. On appeal to the Board of Patent Appeals and Interferences (“BPAI”), the BPAI rejected the Examiner's assertion of a “technological arts” test. The Board also noted that reciting a specific apparatus is not required if there is a physical transformation. However, the BPAI still affirmed the rejection on the grounds that there was no such physical transformation involved, and the claimed process does not produce a “useful, concrete and tangible result” (as per State Street). A Federal Circuit panel heard the appeal from the BPAI's rejection in October 2007. However, after oral arguments, the Federal Circuit acting sua sponte ordered an en banc rehearing.

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