Bilksi affirmed, allowing business process patents

In one of the most highly anticipated, long-awaited patent decisions, the U.S. Supreme Court finally decided Bilski v. Kappos yesterday afternoon. The Court held that the Federal Circuit Court’s so-called “machine or transformation” test is not the only test for a patentable process (requiring it to be tied to a particular machine or apparatus, or one that transforms an article into a different state or thing). Business methods can also be patentable under the current statutory scheme (35 U.S.C. 273), the Court ruled.

Under this interpretation, the Court still threw out the Bilksi patent, which explained through a series of mathematical steps how commodities buyers and sellers in the energy market could protect, or hedge, against the risk of price changes. “This is an unpatentable abstract idea,” the Justices held, in a decision that at least one source says “got it right.” By doing away with the machine or transformation test as the sole test for determining whether an invention is patentable subject matter, “the Supreme Court has kicked open the door and will not allow it to be closed on new technologies and innovations that we cannot today imagine,” says a recent posting by the Practising Law Institute.  Questions concerning the application of the Bilski decision—particularly its impact on the perceived “army” of patent litigation lawyers (and their experts) will surely be debated in the months to come.

Historical footnote:  the Bilski decision was the last for Judge John Paul Stevens before he leaves the bench.