The Federal Circuit opinion, In re Bilski, provides new territory for attacking process claims in patent litigation.
Since the Federal Circuit proclaimed in State State Bank that business methods are not per se unpatentable, patentability under 35 U.S.C. §101 has been a hot topic. Financial sector business method applications, such as the application at issue in In re Bilski, as well as applications concerning Internet business methods, computer software, electric signals, and other new technologies have pressed the Section 101 boundaries at the Unites States Patent and Trademark Office (USPTO) and the Federal Circuit.
Section 101 provides four statutory categories of patent eligible subject matter: processes, machines, manufactures, and compositions of matter. Abstract ideas, mental processes, laws of nature, and mathematical algorithms do not fall within these categories. Whether a patent claim meets Section 101 criteria for patentability is a threshold inquiry. Claims meeting other statutory requirements for patentability still must fail if they do not fall within one of the four articulated categories.
In re Bilski reaffirms the Supreme Court’s “machine-or-transformation” test for determining patentability of processes under Section 101. The “machine-or-transformation” test requires that a process patent claim either be tied to a particular machine or apparatus or transform a particular article into a different state or thing. If a process patent claim meets either prong of this test, the claim passes Section 101 muster.
In determining whether a process claim meets the Section 101 criteria, the Federal Circuit tells us that attention must be paid to the underlying fundamental principle claimed. If the claim preempts all uses of the principle in all fields of use or in a particular field of use, this is evidence that the claim is not limited to a particular application. If, on the other hand, alternative applications exist for the underlying principle—particularly if there are other applications within the same field of use—the claim likely meets the “machine-or-transformation” test. The court also noted that insignificant extra-solution activity (such as adding a data gathering step to a claim directed to a mathematical algorithm) cannot transform an otherwise unpatentable principle into a patentable process.
Notably, the patent claims at issue in In re Bilski were process claims and process claims alone – they do not fall within any of the statutory categories of patentable subject matter. The process claims in In re Bilski also are not tied to a particular machine or apparatus. Thus, the decision is limited to situations where the process claims at issue transform a particular article into a different state or thing.
The decision specifically leaves open Section 101 patentability issues, such as software claims, and whether and when the identification of a computer suffices to tie a process claim to a particular machine. Because patent practitioners often seek to protect software under process claims, Beauregard claims (tying the claimed process to an article of manufacture) and machine claims (tying the claimed process to a computer), we can expect patent litigation to include challenges to these types of claims, and depending upon the wording of a particular claim at issue, these challenges may succeed to invalidate patent claims under Section 101.
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