Document: 425 U.S. 219 96 S.Ct. 1393 47 L.Ed.2d 692 C. Marshall DANN, Commissioner of Patents and Trademarks, Petitioner,v.Thomas R. JOHNSTON. No. 74-1033. Argued Dec. 9, 1975. Decided March 31, 1976. Syllabus Respondent's "machine system for automatic record-keeping bank checks deposits," under which deposits are customer labeled with code categories "read," then processed by a data processor, such as programmable electronic digital computer, having storage files control system, permitting to furnish an individual categorized breakdown his transactions during the period in question, Held unpatentable on grounds obviousness. 35 U.S.C. § 103. Pp. 225-230. 502 F.2d 765, reversed remanded. Howard E. Shapiro, Washington, D. C., petitioner. Morton Jacobs, Philadelphia, Pa., respondent. Mr. Justice MARSHALL delivered opinion Court. 1 Respondent has applied patent what is described application deposits." The permits subtotals various completed connection customer's single account, thus saving time and/or expense conducting this bookkeeping himself. As respondent noted, "invention being sold computer program banks other processing companies so that they can perform these services depositors." Brief 19A; at 18, Application Johnston, 765 (CCPA 1974). 2 Petitioner respondent, well Amici, have presented lengthy arguments addressed question general patentability programs. Cf. Gottschalk v. Benson, 409 63, 93 253, 34 273 (1972). We find no need treat case, however, because we conclude any event respondent's Since United States Court Customs Patent Appeals (CCPA) found be patentable, supra, decision court accordingly reversed. 3 * While pertains highly esoteric field technology, basic functioning invention not difficult comprehend. Under bankcustomer labels each check he writes numerical category corresponding purpose funds expended. For instance, "food expenditures" might coded "123," "fuel "124," "rent" still another "125." Similarly, deposit slip, again, through code, indicates source depositing. When slips bank, codes entered upon them magnetic ink characters, just as, existing procedures, amount or characters. Entries allow information associated "read" special document-reading devices processors. On read device, records electronically stored terms "transaction file." describes steps from point follows: 4 "To process transaction file, . employs certain system. In addition master file used store all required accordance own chart accounts. latter individually designed needs also constructed cooperate transactions. directs generation periodic output reports present accounts desired accounting procedures." Pet. Cert. 4A-5A. 5 Thus, when comes regular statement rendered, programmed sorts out entries produces groups according gives category. quickly see how much spent received given question. Moreover, "(adapt) whatever variations ledger format user may specify." 66. 6 further description invention, recites it made up control. operations common most customers form software program, I. e., meant general-purpose computer. control, directing vary basis customer, separate sequence containing suitable machine-instruction mechanisms along financial data. sets flow compatible IBM 1400 would effectuate 7 then, provide individualized their II 8 After reviewing application, examiner rejected claims therein. He were invalid anticipated prior art, 102, "particularly pointing distinctly claiming" was urging invention. 112. 9 appealed Trademark Office Board Appeals. several grounds. It first 112, indefinite did enough claim concluded 101 claimed nonstatutory subject matter. According Board, computer-related inventions extend "beyond technology nonstatutory," 31A. See Foster, 58 CCPA (Pat.) 1001, 1004, 438 1011, 1015 (1971); Musgrave, 57 1352, 431 882 (1970), viewed "non-technological." Finally, obvious established uses computers banking developed use business organizations, had already been patented. Dirks, U.S.Patent 3,343,133. 10 CCPA, 3-2 ruling, held patentable. began distinguishing its view " 'record-keeping Machine accounts' Board's rather negative going solely 'relationship customers.' F.2d, 770 (emphasis opinion). such, held, "clearly within 'technological arts,' Id., 771, therefore statutory matter 101. narrowly drawn sufficiently detailed pass muster definiteness requirements Dealing final area rejection, neither practice nor Dirks rendered "obvious one ordinary skill art who (respondent's) specification before him." 772. 11 order hold necessary distinguish Court's (1972), handed down some 13 months subsequent ruling instant case. sought "new useful process," 101, "a method programming convert signals binary-coded decimal into pure binary form." U.S., 65, S.Ct., 254, 276. observed: "The limited particular apparatus machinery, end use." 64, L.Ed.2d, 275. Our holding, Id. 71, 257, 279, patentable "process" term defined 100(b).1 12 Solicitor argued Benson's holding nonpatentability case controlling here. However, while Benson involved "process," advancing "apparatus" "machine" involve discoveries abstract unpatentable: 'The issue considered Supreme narrow one, namely, formula converting numerals series mathematical calculations Process? ' (Emphasis added.) (Quoting re Christensen, 478 1392, 1394 1973).) 14 "(T)he Apparatus form, do encompass law nature, formula, algorithm." 771 15 Having disposed rejections distinguished satisfaction, review granted certiorari. 421 962, 95 1948, 44 448 (1975). 103 reverse. III 16 judicial test, "invention" I.e., "an exercise inventive faculty," McClain Ortmayer, 141 419, 427, 76, 78, L.Ed. 800, 803 (1891) long regarded absolute prerequisite patentability. See, g., Keystone Driller Co. Northwest Engineering Corp., 294 42, 55 262, 79 747 (1935); Sharp Stamping Co., 250, 26 445 (1880); Hotchkiss Greenwood, How. 248, 683, 1851). only 1952 Congress, interest "uniformity definiteness," articulated requirement statute, framing "nonobviousness."2 Section Act 1952, 103, provides full: 17 "A obtained though identically disclosed set forth section 102 title, if differences between patented whole person said pertains. Patentability shall negatived manner made." 18 This treated scope detail Graham John Deere 383 1, 86 684, 545 (1966). There, "was intended Congress change level invention," but "merely codification precedents congressional directions inquiries obviousness patentability." 17, 693, 556. recognizing inevitability difficulty making determination cases, Graham, central factors relevant inquiry obviousness: "the content art," "differences issue," pertinent art." Ibid. Guided factors, proceed 19 Supra, 223, relied two elements reaching conclusion obvious. both significant. nature current equipment programs industry. itself observes, extensive: 20 "Automatic equipments employing handling automatically forming those items machine-readable With machine systems, extensive performed automatically." 3A. 21 statements ordinarily bank. previously status progress "sub-accounts." "category code" scheme, p. 221, is, think, closely analogous bank's offering multiple choose writing check. Indeed, noted number, varying transaction, account creates "in effect, different distinct numbers ." 34A. note segregated debits attributable service charges Within charges. 22 utilization traditional course, somewhat encompassed does something than "provide summary sheet consisting net totals plural bank." 771. must remembered "obviousness" test turns whether equivalent element difference "is sufficient render unobvious skilled applicable art. 772 (Markey, J., dissenting). 23 There make turn For, pointed second factor issued Gerhard supports discloses complex using large organization. balance kept updated department allows areas, types expenses. flexible additional breakdowns "sub-areas" areas record specially designated regarding department's disbursing office corporation continually apprised precise corporation's disbursements or, them, "Item Groups." Again, industry departments organization Groups" number designations respectively And shares similar capacity numbers. specifically many characteristics capabilities 35, 702, 566. 24 "obviousness," important remember criterion measured layman, "reasonably (the applicable) 37, 703, 567. context assumed hypothetical aware systems patent. exploding "(i)t evenhanded require persons benefit monopoly charged awareness" technology. 19, 695, 557. 25 Assuming awareness, would, state makes system's ability small users get large-scale continue methods." 65. possessed same extent either system.3 But mere existence establish invention's nonobviousness. gap simply great nonobvious reasonably art.4 Accordingly, reverse remand proceedings consistent opinion. 27 So ordered. 28 Reversed 29 BLACKMUN STEVENS took part consideration 'process' means process, method, includes new known machine, manufacture, composition matter, material." 100(b). S.Rep. 1979, 82d Cong., 2d Sess., (1952); H.R.Rep. 1923, (1952). organizational (I.e., analogues to) retain authority over operative systems" "(p) rogramming very easy easily coordinated." "commercial success without will patentability," Great Atlantic & Pacific Tea Supermarket Equipment 340 147, 153, 71 127, 131, 162, 167 (1950), indicate (1966), "secondary considerations (such) commercial success, felt unsolved needs, (and) failure others" 694, contend secondary offer substantial support

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