Source: https://patentlyo.com/patent/patentable-subject-matter
Timestamp: 2019-04-21 18:12:15+00:00

Document:
I am sure Dennis will do his usual full and grand treatment, but this one is sort of the counter-punch to Ultramercial. In I/P Engine, Inc. v. AOL Inc. (Fed. Cir. Aug. 15, 2014) (per curiam), the court split on whether the claims were properly found by the jury to have been not obvious, with Judge Chen dissenting on that point and the per curiam opinion reversing the finding of no invalidity. (The other panel members were Judge Wallach and Judge Mayer).
The Supreme Court has dictated that the subject mat- ter eligibility analysis must precede the obviousness inquiry. Flook, 437 U.S. at 593 (“The obligation to determine what type of discovery is sought to be patented” so as to determine whether it falls within the ambit of sec- tion 101 “must precede the determination of whether that discovery is, in fact, new or obvious.”); Bilski, 130 S. Ct. at 3225 (explaining that the issue of whether claims are directed to statutory subject matter is “a threshold test”); see also In re Comiskey, 554 F.3d 967, 973 (Fed. Cir. 2009) (“Only if the requirements of § 101 are satisfied is the inventor allowed to pass through to the other requirements for patentability, such as novelty under § 102 and . . . non-obviousness under § 103.” (citations and internal quotation marks omitted)). To fail to address at the very outset whether claims meet the strictures of section 101 is to put the cart before the horse. Until it is determined that claimed subject matter is even eligible for patent protection, a court has no warrant to consider subordinate validity issues such as non-obviousness under 35 U.S.C. § 103 or adequate written description under 35 U.S.C. § 112.
From a practical perspective, there are clear advantages to addressing section 101’s requirements at the outset of litigation. Patent eligibility issues can often be resolved without lengthy claim construction, and an early determination that the subject matter of asserted claims is patent ineligible can spare both litigants and courts years of needless litigation. To the extent that certain classes of claims—such as claims on methods of doing business—are deemed presumptively patent ineligible, moreover, the United States Patent and Trademark Office will have more resources to devote to expeditiously processing applications which disclose truly important advances in science and technology.
Even more fundamentally, the power to issue patents is not unbounded. To the contrary, the constitutional grant of authority “[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries,” U.S. Const. art. I, § 8, cl. 8, “is both a grant of power and a limitation,” Graham v. John Deere Co., 383 U.S. 1, 5 (1966); see Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 146 (1989). Section 101’s vital role—a role that sections 103 and 112 “are not equipped” to take on, Mayo, 132 S. Ct. at 1304— is to insure that patent protection promotes, rather than impedes, scientific progress and technological innovation. A robust application of section 101 ensures that the nation’s patent laws remain tethered to their constitutional moorings.
Jason’s excellent post on Roslin summarized the case and raised the question of whether the Federal Circuit paid insufficient attention to the inherent differences conveyed by the ‘clone’ limitation of the claims. In this post I address two other issues in Roslin: the Federal Circuit’s interpretation of Ckakrabarty and Funk Brothers, and Roslin’s consistency with Federal Circuit precedent holding that structural or functional differences between natural and synthetic products must be defined in the claims.
Unaltered by the hand of man: Judge Dyk’s opinion in Roslin unfortunately perpetuates the view, now found in the PTO’s Myriad guidelines, that Chakrabarty requires a claimed invention to be “markedly different” from a natural product for patent-eligibility under § 101. Myriad itself imposed no such requirement: the Court found BRCA cDNAs patent-eligible without determining that they were “markedly different” from natural sequences. And though Myriad reiterated the “markedly different” language from Chakrabarty, Chakrabarty’s discussion of ‘products of nature’ was entirely dictum. Only the question of whether living organisms were patent-eligible was before the Court in Chakrabarty; the ‘product of nature’ rejection in the case had not been sustained by the Patent Office Board of Appeals.
The Chakrabarty Court noted the claimed bacteria differed markedly from natural bacteria by way of distinguishing the case from Funk Brothers. As Paul Cole’s recent post notes, the patentee had discovered that certain strains of bacteria could be mixed together without inhibiting their nitrogen-fixing capability. Justice Douglas regarded this compatibility as the unpatentable discovery of a natural phenomenon; the claims were unpatentable because the patentee’s application – a mixed inoculant – was “a simple step” once the underlying discovery was assumed away.
As I discuss in a recent article, Funk was nonetheless very much a patent eligibility case. It reflects Douglas’s view – shared by Justice Stevens in Flook, and Justice Breyer in Mayo – that obvious applications of scientific discoveries or abstract ideas are not patent-eligible “inventions” within the meaning of the statute.
Whether or not we share that view, understanding it shows us that Funk was an ‘inventive application’ case, not a ‘product of nature’ case. Douglas made no reference to the ‘product of nature’ doctrine, nor to the recent cases embodying it. Instead, Douglas emphasized the lack of change in the bacteria to establish that the mixed inoculant was obvious (once the patentee’s discovery was assumed away). Under the old doctrine of ‘aggregation,’ it was not invention to combine old elements where the elements were unchanged, and no new function arose from their combination. It was therefore not inventive for the patentee in Funk to combine old bacteria without changing their structure or function.
But just as many combinations of old elements become patentable when a new function emerges, the mixed inoculants of Funk would have been patentable — even if the bacteria remained unchanged — had the mixed inoculant acquired new functions not performed by its constituent bacteria. If Funk Brothers instead stood for the proposition that a combination is unpatentable if its constituents are ‘unaltered by the hand of man,’ then a very large number of inventions become patent-ineligible. An artificial structure like an arch, formed by piling stones atop each other, would be ineligible unless the stones themselves were altered by the hand of man. Even as ardent a skeptic of the patent system as Justice Douglas would not have gone that far.
Source limitations and expressly claimed distinctions: The second difficulty with Roslin is its demand that the ‘marked differences’ between the natural organism and the invention must be expressly claimed. As Jason discussed, the applicant in Roslin argued that cloned animals differ from their natural counterparts at least in having mitochondrial DNA derived from the egg donor, rather than the animal which donated the somatic nucleus. The Federal Circuit rejected such arguments because neither the difference in mitochondrial DNA, nor any functional consequence of that difference, was recited in the claims.
Thus under Amgen, a source limitation alone (such as ‘non-naturally occurring’ or ‘purified from mammalian cells grown in culture’) may establish novelty of a product. Assuming the ‘clone’ limitation in Roslin to require derivation from nuclear transfer, then it serves as a source limitation as well. Since Roslin cannot overrule Amgen, we seem to be in a regime where differences between natural and synthetic products may be unclaimed yet confer novelty under § 102, but must be explicitly claimed to establish ‘marked difference’ under § 101. Of course, if Roslin is correct, that doctrinal inconsistency is less significant than the consequence that Amgen-type claims – and perhaps a wider category of product-by-process claims involving natural products – are now ineligible under § 101.
 In Chakrabarty, the Commissioner never suggested that the claimed bacteria were unpatentable under Funk, nor even raised the case. Rather, Chakrabarty argued that if living organisms were not patent-eligible, the Court would have said so in Funk.
 In particular, the General Electric and Marden cases denying patentability to purified tungsten, uranium, and vanadium. The defendant had urged General Electric upon the Funk court in its brief.
In a per curiam opinion marked nonprecedential, the Federal Circuit has vacated and remanded the subject matter invalidity finding of a N.D. California District Court and instead ordered the court to rework its decision in light of Bilski v. Kappos, 130 S. Ct. 3218 (2010) and subsequent Federal Circuit decisions on point. As discussed below, FuzzySharp’s invention relates to compression software for computer graphics. U.S. Patent Nos. 6,172,679 and 6,618,047. The main idea of the invention is to avoid calculations associated with always hidden surfaces. Although the specification explains that its implementation uses “fuzzy” math to calculate always hidden surfaces. However, “fuzzy” limitations are not found in the asserted patent claims. The application was filed in 1997, but claims priority to a 1991 Australian patent application.
FuzzySharp’s appeal was filed after the district court determined that the claimed method failed to pass the machine-or-transformation and therefore, under the prevailing law at the time, the method did not constitute patentable subject matter. In re Bilski, 545 F.3d 943 (2008). In its 2010 Bislki decision, the Supreme Court rejected the notion that the machine-or-transformation test could serve as the exclusive test of the patentable subject matter of a newly invented process. In the new rubric, the machine-or-transformation test offers only an important clue.
In its opinion, the Federal Circuit largely agreed with the lower court’s conclusion that the FuzzySharp claims fail the machine-or-transformation test, but, following the new Bilski rubric, remanded for a determination on the ultimate question of patentable subject matter.
Meaningful Limitations: FuzzySharp’s asserted claims involve two elements that are potentially linked to a machine – computation and computer storage. However, the appellate panel found those elements lacked “meaningful limits” on claim scope in the same way that the recitation of a general-purpose-computer is not a meaningful limitation of a software process that will only be performed on a computer. (Citing Gottshalk v. Benson, 409 U.S. 64 (1972)).
Claim Construction: An important and arising issue is the interplay between claim construction and patentable subject matter. Under Federal Circuit precedent, claim construction appears to be a necessary precursor. However, the Supreme Court has regularly ignored details of claim language in making its determinations – focusing instead on what it saw as the invention.
Here, the court held that some claim construction is necessary: “[W]e conclude that … the patent eligibility of at least one of the asserted claims turns on questions of claim construction that the district court did not have the opportunity to address.” It will be interesting to watch how the parties argue on remand for claim construction results that favor their hoped-for subject matter eligibility outcome.
The per curiam panel included Judges Bryson, O’Malley, and Reyna.
The U.S. application was prosecuted by Carl Oppedahl’s Colorado-based firm.
The patentee is represented by Matthew McAndrews from the Niro firm on appeal; Jonathan Baker from Skadden Arps is handling the appellate defense.
skipping, at said step of visibility computations, at least an occlusion relationship calculation for at least one entity that has been determined to be invisible in said computing step.
In Ultramercial v. Hulu, the Federal Circuit held that Ultramercial's asserted Patent No. 7,346,545 fit within the subject matter eligibility guidelines of 35 U.S.C. § 101 and was not merely an unpatentable abstract idea. The patent claims a method of distributing copyrighted products (such as a movie) over the internet. The novel idea is that the copyrighted product be both (1) offered for sale and (2) delivered for free if the consumer agrees to view an advertisement. The district court held the patent invalid under section 101. On appeal, however, the Federal Circuit reversed – holding that the patent claims a "practical application" of the idea that "advertising can serve as a currency." An important element of the decision was the finding that "[v]iewing the subject matter as a whole, the invention involves an extensive computer interface."
Now, WildTangent (one of the accused infringers) has petitioned for a rehearing en banc. The public interest organization Electronic Frontier Foundation (EFF) has filed a brief in support of the rehearing – arguing that an en banc determination is necessary in light of (1) the court's failure to follow Bilski v. Kappos; (2) inconsistencies in application of the law apparent from the court's recent decisions in Ultramercial, Classen Immunotherapies v. Biogen IDEC, and CyberSource Corp. v. Retail Decisions, Inc.; and (3) a growing intra-circuit division regarding patentable subject matter jurisprudence. This filing ties-in closely with the pending Supreme Court case of Mayo v. Prometheus, which questions the patentability of a method of personalizing the dosage of a pharmaceutical and the pending case of AMP v. Myriad, which questions the patentability of isolated human DNA. Other pending Section 101 cases include DealerTrack, Inc. v. Huber (App. No. 2010-1544) (Claims 1, 3, and 4 of U.S. Patent No. 7,181,427); FuzzySharp Tech., Inc. v. 3DLabs Inc. (App. No. 2010-1160) (U.S. Patent Nos. 6,172,679 and 6,618,047); CLS Bank Int'l. v. Alice Corp (App. No. 2011-1301) (Patent No. 7,725,375); Cognex v. ITC (App. No. 2011-1098) (Patent Nos. 7,016,539 and 7,065,262); and Fort Properties, Inc. v. American Master Lease LLC (App. No. 2009-1242) (Patent No. 6,292,788).
Last year, Professor Merges and I co-authored this short article on the administration of Bilski. In light of the pending Section 101 cases and Judge Rader's opinion in Classen Immunotherapies v. Biogen, I thought I would post it here again. Download the twenty-page essay from SSRN.
Now that the Supreme Court has decided Bilski v. Kappos, there is an enormous amount of speculation about the case's impact on patent applicants, litigants, and other participants in the patent system. Most of the commentary is concerned with the holding in Bilski, how this holding will be applied by courts and the Patent Office, and ultimately, the effect of the holding on inventors, and those who hold and seek patents.
We take a different approach; rather than try to cut through the complexity of Bilski, or predict how it will be applied, we talk about how to avoid it. We are interested in how to minimize the cost and confusion that accompany a review of patents for § 101 subject-matter eligibility. To be specific, we propose that the § 101 issue of Bilski be considered only when doing so is absolutely necessary to determine the validity of a claim or claims in a patent. We believe any claim that can be invalidated under one of the less controversial and less complex requirements for patentability—§§ 102, 103, and 112, for instance—ought to be disposed of without considering subject matter patentability. In other words, the Bilski issue should be avoided wherever it is not strictly necessary. To support this conclusion, we present a set of empirical data that indicates that the vast majority of patent claims challenged on subject matter eligibility grounds were also challenged on other patentability issues.
We set the stage for our proposal in Part II, which briefly reviews the history behind Bilski and explains its open-ended holding and individualized approach. The difficulty of applying the Bilski ruling to different types of patent claims leads us to Part III, in which we call into question an accepted (if largely implicit) principle of patent law—that the lexical priority of statutory provisions in the 1952 Patent Act dictates a necessary logical sequence of invalidity tests. We reject this widespread assumption. There is nothing in the statute that requires this.
Indeed, in Part III we argue that in many ways the very idea of a sequence of discrete patentability requirements is conceptually misleading. Claims can be and often are rejected by the Patent Office for multiple reasons, suggesting that at least certain claims suffer from defects that transcend specific statutory validity requirements. We argue further that the policy underpinnings of various requirements overlap in complex ways, so that in reality patentability doctrine does not test for a series of discrete and independent qualities that are distinct from and mutually exclusive of each other. In the same way, transcendent qualities of an invention can influence multiple doctrines simultaneously, with pioneering inventions (due to both a liberal treatment under enablement, and a broad reach under infringement doctrines) being a prime example. This demonstrates again that there is not and should not be a strong separation between various patent law doctrines. Another argument along these lines recognizes that while patentability doctrines are not discrete entities, neither is "the invention" whose validity is being considered. Patent applicants routinely present multiple, overlapping claims, all of which cover fine-grained variations on a central inventive insight or advance. So it is inaccurate to visualize patentability as a stepwise series of tests applied to a single "invention." It is not true for example that "invention X" passes § 101 and should thus proceed in logical sequence to be tested under § 102. One claim growing out of inventive insight X might present no § 101 problems at all, yet another claim in the same patent application might raise a difficult issue under this provision. Each claim, being a unique slice of the overall inventive insight, ought to be considered on its own terms, and in whatever order makes the most sense. Put another way, the mental model of a stepwise sequence of patentability determinations overlooks the highly granular nature in which different slices of the inventive concept are presented for validity testing.
This analysis is further developed in Section III.A. When a claim fails to pass muster under any single test of validity, that claim should be invalidated. No further tests should be applied. We describe this as "chain" theory of validity: once one link in the chain is broken, the claim fails, and there is no reason to proceed further. Beyond that point, any expenditure of resources on validity questions is inefficient. Pragmatic considerations enter at this point. Issues of cost, justiciability, and spillover effects are perfectly appropriate in determining the actual sequence in which validity tests are applied with respect to any particular patent claim. The non-linearity of patent validity tests, together with the principle of efficient administration, yields a simple rule: start with chain links that are, in general, easiest and cheapest to test, and when the chain fails, stop the process. That way, the costliest and most complex doctrines—the trickiest "links in the chain"— are often avoided, and in any event are put off until later. Therefore, § 101 should often be avoided, both at the Patent Office and in the courts. We justify this not only on efficiency grounds, but also by analogy to the Supreme Court rules of avoidance.
In Part IV, we apply this simple principle. It leads to several recommendations. First, though the PTO has good reasons for its longstanding practice of rejecting claims for multiple reasons, we recommend that §101 be used only as an exception or last resort even at the PTO. Next, we contend that the courts should proceed in a stepwise fashion, beginning with §§ 102, and 103, and 112, changing the order of doctrines as dictated by pragmatic considerations, and stopping as soon as a claim is conclusively invalidated. In all cases, the complex and costly process of deciding whether a claim presents patentable subject matter under § 101 should be deferred until very late in the process. Therefore, we recommend, courts should in effect hold off on the difficult task of evaluating claims under § 101—ideally deploying the full § 101 analysis only when that is essential, i.e., when a claim passes muster under the other validity doctrines.
Charles H. Duell was the Commissioner of US patent office in 1899. Mr. Deull's most famous attributed utterance is that "everything that can be invented has been invented." Most patent attorneys have also heard that the quote is apocryphal.
In his 1989 article, Samuel Sass traced the quote back to 1981 book titled "The Book of Facts and Fallacies" by Chris Morgan and David Langford. Sass did his work well before Gore created the Internets, so I decided to take a fresh look at the research using Google. The following chart was created based on Google's electronic compilation of 12 million books. The chart shows the frequency that the phrase "everything that can be invented" shows up in the corpus, grouped by the year of publication of each book. The chart shows that Mr. Sass is largely correct in his assessment. Google has no reference to the quote prior to 1980 in its ngram database.
However, with a bit more searching, I came across an 1899 edition of Punch Magazine that had been donated to Harvard University by the Pulitzer family. In that edition, the comedy magazine offered a look at the "coming century." In colloquy, a genius asked "isn't there a clerk who can examine patents?" A boy replied "Quite unnecessary, Sir. Everything that can be invented has been invented."
I suspect that 1899 joke is the origin of the expression. Of course, there is still Ecclesiastes.
Last Friday, the Federal Circuit released its second noteworthy post-Bilski decision (the first being Research Corp v. Microsoft). The opinion, Prometheus v. Mayo, issued following a grant-vacate-remand order from the Supreme Court instructing the CAFC to revisit its original decision in light of Bilski. Despite this procedural posture, however, the new opinion is quite similar to the old, arriving at the same conclusion through essentially the same reasoning.
Prometheus initially came to the Federal Circuit following a district court grant of summary judgment of invalidity under § 101 (lack of patentable subject matter). After the CAFC reversed the ruling of invalidity using its "machine-or-transformation" test, Mayo sought review by the Supreme Court. The Court granted certiorari, vacated the CAFC decision, and remanded for consideration in light of its Bilski opinion. Earlier Patently-O commentary includes a summary of the original Federal Circuit opinion and a discussion of the remand.
The patents-in-suit claim a method for determining whether a patient has received a therapeutically efficacious amount of drugs such as 6-mercaptopurine ("6-MP") and azthiopurine ("AZA"), which are used to treat inflammatory bowel diseases but can produce toxic side effects. In the human body, these drugs metabolize into 6-MP metabolites, including 6-methylmercaptopurine ("6-MMP") and 6-thioguanine ("6-TG"). By administering the drug, measuring the subject's levels of 6-MMP and 6-TG and comparing them to pre-determined levels, toxicity can be minimized and efficacy maximized.
Although similar in most respects, some claims of the second patent-in-suit, No. 6,680,302, dispense with the "administering" step.
On remand, the CAFC again rejected Mayo's argument that the '623 and '302 patents claim a "natural phenomenon." In seeking a judgment of invalidity under Section 101, Mayo contended (and the district court agreed) that the "administering" and "determining" steps are merely necessary data-gathering steps for the use of the correlations between 6-TG and 6-MMP and therapeutic efficacy or toxicity in patients. Because these correlations are simply natural phenomena, Mayo reasoned, they were unpatentable.
As before, the Federal Circuit disagreed, noting that Bilski provides a broad – although not unlimited – scope for patent protection, and “an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection.” Slip. Op. at 12, quoting Bilski, 130 S.Ct. at 3230. Furthermore, the court stated, neither the Supreme Court's order to vacate and remand the original Prometheus decision nor Bilski dictates a wholly different analysis or different result.
The crux of the CAFC's determination that the asserted claims recite a patent-eligible application of naturally occurring correlations between metabolite levels and efficacy or toxicity as opposed to the natural correlation itself rests on the specific treatment steps recited by the claims: the "administering" step and the "determining" step. "The inventive nature of the claimed methods stems not from preemption of all use of these natural processes, but from the application of a natural phenomenon in a series of steps comprising particular methods of treatment." Slip. Op. at 15-16.
In support of its conclusion, the court reiterated its earlier determination that the treatment methods in Prometheus's patents satisfy the "machine-or-transformation test. Although this is not the exclusive test, post-Bilski, it nevertheless provides important clues to subject matter patentabilty. In applying the machine-or-transformation framework, the court specifically rejected Mayo's argument that the disputed claims simply claim natural correlations and the associated data-gathering steps, broadly stating that the asserted claims are "claims to methods of treatment, which are always transformative when one of a defined group of drugs is administered to the body to ameliorate the effects of an undesired condition." Slip Op. at 17. Even leaving out the administration step does not make the claims unpatentable, as the CAFC also found the "determining" step to be transformative because it involves "[s]ome form of manipulation, such as the high pressure liquid chromatography method specified in several of the asserted dependent claims or some other modification of the substances to be measured, [which] is necessary to extract the metabolites from a bodily sample and determine their concentration." Id. at 18.
In reaching this conclusion, however, the court was forced to distinguish its earlier decision In re Grams, 888 F.2d 835 (Fed. Cir. 1989), which similarly claimed a process that involved "(1) performing a clinical test on individuals and (2) based on the data from that test, determining if an abnormality existed and determining possible causes of any abnormality by using an algorithm." Id. at 20. Unlike the claims in Grams – which the CAFC found unpatentable "because the tests were just to 'obtain data'" (Slip Op. at 20) – the claims of the Prometheus patents "require the performing of clinical tests on individuals that were transformative."
In addition to its overarching analysis of the subject matter issue, the opinion also includes an interesting discussion of the use of mental steps in patent claims. Although the CAFC agreed that the final "wherein" clauses are mental steps, "A subsequent mental step does not, by itself, negate the transformative nature of prior steps. Thus, when viewed in the proper context, the final step of providing a warning based on the results of the prior steps does not detract from the patentability of Prometheus’s claimed methods as a whole." Slip Op. at 21. Because no claim in the Prometheus patents claims only mental steps, "contrary to Mayo’s assertions, a physician who only evaluates the result of the claimed methods, without carrying out the administering and/or determining steps that are present in all the claims, cannot infringe any claim that requires such steps." Id.
Hal Weger of Foley has suggested that another grant of certiorari may be down the road, given the opinion's refusal to discuss a three-Justice dissent from the dismissal of certiorari in Lab. Corp., 548 U.S. 124, that was cited with approval by five Justices in two concurrences in Bilski.
The Canadian Commissioner of Patents rejected Amazon's one-click patent application — pejoratively calling the invention a “business method.” The Commissioner's legal hook for rejection was that business methods do not fit within the legal definition of “invention” required by s. 2 of the Canadian Patent Act. The text that provision was derived from United States law and closely follows the language of the 35 U.S.C. 101.
Although the Court had the power to grant the patent, it decided instead to remand the decision for “expedited re-examination” – noting that the Patent Office’s decisions on other patentability doctrines may have been tainted by the Office’s desire for this to serve as a test case on patentable subject matter eligibility.
Comparative International Law: Canadian courts often welcome a comparative analysis of the laws of its neighbors – especially the laws of the United Kingdom and United States. In the patent realm, the European Patent Convention (EPC) is also influential. While those laws often help the courts in making policy decisions, the Canadian decision “must correspond to Canadian law. . . . International jurisprudence, and certainly the policies advocated therein, is not determinative, but at most a potential guide when applied correctly and mindfully.” Here, the Court appears to have closely followed the US Supreme Court’s recent decision in Bilski v. Kappos, 130 U.S. 3218 (2010).
The chart above shows the cumulative law review citation count for the Supreme Court's leading pre-Bilski patentable subject matter decisions. The data is based on a westlaw keycite search, each law review article is counted only once per case. Thus, if an article that cites Diehr twenty times only adds one to the tally.
Back on November 30, 2009, Patently-O published my article “In Defense of Software Patents” in response to the editorial “Abandoning Software Patents” by Ciaran O’Riordan, Director of End Software Patents (posted on Patently-O on November 6, 2009) which had as its premise that software companies are trying to protect “software ideas”.
In this article I comment on the Bilski Opinion as well as give some concrete examples of software-only patents as well as hardware/software patents. Also, my previous article received hundreds of comments, many being negative, and part of this new post is in response to those negative comments.
Since the June 28th Supreme Court Bilski decision there have been many articles on what the Opinion stated and inferred about the patentability of software.
The Opinion restated what previous Supreme Courts concluded: that laws of nature, physical phenomena, mathematics, mathematical formulas (by themselves), algorithms (by themselves), and abstract ideas (which would include software ideas) are not eligible for patent protection.
While the Bilski Opinion never directly questioned the patentability of software, the Justices wrote extensively about the meaning of Section 101, the meaning of the term “process” and why the test for patent eligibility should not exclusively be “the machine-or –transformation test”. Justice Kennedy, with the concurrence of all other Supreme Court members, wrote that the Information Age puts innovation in the hands of more people and raises new difficulties for the patent law (and the Patent Office) to determine who should or should not receive patent protection.
My November 2009 Patently-O article “In Defense of Software Patents” produced hundreds of comments. Many wrote that they were against the patenting of software because software was an “algorithm” or “mathematics”. In that article my primary argument was that a computer software invention is as patentable as a computer hardware invention and the only difference is the mode of implementation. My thesis was that Software Product companies in the Software Industry are looking to patent a machine process and not a computer program, which is protected by the copyright law. I showed why software product companies can be viewed as high technology manufacturing entities and should be just as eligible for patent protection as computer hardware companies.
In this article I give examples of patents where the preferred implementation of an inventive machine process is in software (via a computer program), hardware (via circuitry), or a combination of both software and hardware.
There is little argument that “processes” and “machine processes” are patentable subject matter The question has always been about the nature of software and what one is trying to patent. For over 40 years I have been involved in that argument since I received the first software patent in 1968 for an innovative way to sort large amounts data on a computer that had tape drives that could only read and write data in a forward direction (See Patent # 3,380,029, Sorting System, Issued April 23, 1968).
The Sorting System patent was dubbed a software patent but it could also have been a computer hardware patent. It was dubbed a software patent solely because the preferred implementation (the disclosure) was a logic chart (which is recognized by the patent office as a proper disclosure). My Sorting System patent would not have been controversial if the disclosure had been hardware circuitry since there were many hardware patents for sorting data on special-purpose computers and special apparatus. In my patent application I referenced six of those patents which all had unique hardware circuitry in their patent disclosure. Three of them are available online, courtesy of Google Patent Search.
Whether a computerized machine or industrial process that is patentable subject matter under 35 USC 101 when constructed with a hardware program (wired circuits) would also be patentable subject matter when constructed with a stored computer program (i.e., firmware or software)?
The example above of a hypothetical “cabinet for the blind” invention was back in 1980 in our Diehr Amicus brief.
Twenty years later, in 2000, a renowned inventor, Ray Kurzweil received a patent named Reading System which Reads Aloud From An Image Representation Of A Document. The patent disclosure shows a diagram of a monitor, scanner, speakers, and a PC computer composed of a processor, storage and a keyboard. The essence of the disclosure and the invention is a logic chart describing a machine system which interacts with a speech synchronizer and the various devices.
At that time, Ray Kurzweil’s company, Kurzweil Educational Systems marketed a special purpose hardware/software system called the Kurzweil 3000 Reading Machine which was marketed to the blind and poor readers. Their 2000 year patent protected this product from imitators. Today the company sells a software only system called Kurzweil 3000 and continues to have the protection of the patent system thru his original 2000 patent and with additional patents e.g., Reducing processing latency in optical character recognition for portable reading machine (which is a software-only patent).
Few would argue that the Kurzweil 3000 Reading Machine was not an invention and not deserving of a patent.
While I am a strong advocate for software-related patents I have always been opposed to the patenting of Business Method Patents (BMPs). In my 2006 article Patents: Where's the Invention? I stated that the Patent Office should do what the European Patent Convention did when it ruled that anything that consists of "schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers" is not an invention and therefore not patentable.” Justice Stevens, in his Opinion also wanted to ban BMP’s from being patentable subject matter when he concluded that a method of doing business is not a “process” under 101.
Although the Bilski Opinion disallowed the Bilski application they stated that under certain conditions business methods could still be patentable subject matter. On July 27th the USPTO set up more stringent rules for the issuance of BMPs in their Interim Guidance for Determining Subject Matter Eligibility for Process Claims in View of Bilski v. Kappos. In many ways those guidelines are similar to the way computer software and hardware patents are currently being treated under the 1996 Guidelines for Computer-Related Inventions.
One of the greatest challenges facing the Patent office today for BMPs, software or hardware patent applications is in discovering prior art and determining if there is an invention. The USPTO “Peer to Patent” pilot project” which allows the public (including professionals in their respective fields) to comment on patent applications is still in its infancy, but offers the potential to assist the Patent Office in rejecting the large number of applications that are filed each year. The stated goal of the pilot project was to “connect the USPTO to an open network of experts online.” Also, private companies e.g., the Article One Partners, a patent research firm, have the potential to significantly reduce the large number of patent litigation cases.
In conclusion, while I am a strong proponent of software patents I am very aware, and agree with, many of the arguments against patents because of patent trolls, frivolous patents, e.g. Amazon’s one-click patent, and frivolous patent litigation that can put companies out of business. And I support changes in the Patent Law to reduce those problems. But if one believes in the how the Patent System has fostered innovation and helped the US grow and prosper, then there is no rational reason to eliminate technology inventions that use software as its implementation.
In my previous article there were many comments from die-hards that continued to believe that software companies are trying to patent a computer program, Whether those die-hards still believe that a computer program is mathematics, or a mathematical formula, or an algorithm, or an abstract idea, so be it. Computer software programs are not what software companies are trying to patent. A software patent invention is on a unique machine process —- nothing more and nothing less. And the criteria should be 1. Innovation 2. A proper disclosure and 3. Usefulness — the same requirement that is the criteria for all patentable subject matter.
 Click below for a sample of many of these articles. Reading the Bilski Tea Leaves For What The Supreme Court Thinks Of Software Patents Comments on Bilski and Software Patents; Here's Bilski: It's Affirmed, But . . .No Decision on Software Patentability; Supreme Court Decision Raises Software Patent Questions; Supreme Court 'Bilski' ruling doesn't rule out software, business-method patents; Software patent debate rages on; Software, pharmaceutical, and business method patents survive; Patent Office Says No to Supreme Court and Software Patents; Death Knell For Software Patents; Software Is Not Necessarily Business Method; Software Patents and Business Method Patents Still Possible after Bilski Supreme Court Decision.
 While the implementation is in a computer program, the disclosure for one skilled in the art, are thru flow charts (also called logic charts) and thru block diagrams.
. The Bilski Opinion closely examined the meaning and the words of 35 U.S.C 101. From 35 U.S.C. 101: Inventions patentable: Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent there for, subject to the conditions and requirements of this title.
 The Sorting Patents below were described thru and/or gates, and as methods and apparatus for sorting data. Sorting Device, Fillebrown, 5/1961 #2,985,864; Sorting Apparatus, Guerber, 5/1960 #2,935,732; Apparatus for sorting of Recorded Digital data, Dirks 3/1966 #3,242,466.
 (page 15) Because the text of §101 does not on its face convey the scope of patentable processes, it is necessary, in my view, to review the history of our patent law in some detail. This approach yields a much more straightforward answer to this case than the Court’s. As I read the history, it strongly supports the conclusion that a method of doing business is not a “process” under §101.
For many, the most interesting aspect of this case comes at the end in Judge Dyk’s dissent. Dyk makes the case that genes should not be patentable.
In 2006, Intervet filed a complaint against Merial — asking the DC District Court for a declaratory judgment that Intervet’s Porcine Circovirus vaccine (PCV-2) did not infringe Merial’s gene patent. Merial’s patent claims both the isolated DNA molecule of PCV-2 and a vector that contains the DNA. The application includes a listing of several different sequences that all fall within the PCV-2 category.
Although Intervet also uses a PCV-2 vector. The DJ plaintiff argues that its DNA molecule is different from the one described and deposited by Merial. The district court agreed — holding that the Intervet product was only 99.7% homologous to the closest deposited sequence and therefore outside of the literal claim scope. The district court also applied prosecution history estoppel to rejected Merial’s claims of infringement under the doctrine of equivalents (DOE). On appeal, the Federal Circuit reversed on both claim construction and DOE.
Dissenting-in-part, Judge Dyk discussed his argument that the claims directed toward the isolated form of a naturally occurring gene are likely unpatentable under 35 U.S.C. § 101.
[T]he isolated DNA claim raises “substantial issues of patentable subject matter under 35 U.S.C. § 101. . . . Neither the Supreme Court nor this court has directly decided the issue of the patentability of isolated DNA molecules. Although we have upheld the validity of several gene patents, none of our cases directly addresses the question of whether such patents encompass patentable subject matter under 35 U.S.C. § 101. . . .
I think that such patents do in fact raise serious questions of patentable subject matter. The Supreme Court’s recent decision in Bilski v. Kappos has reaffirmed that “laws of nature, physical phenomena, and abstract ideas” are not patentable. No. 08-964, slip op. at 5 (U.S. June 28, 2010) (quoting Diamond v. Chakrabarty, 447 U.S. 303, 309 (1980)); Funk Bros. Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130 (1948). Just as the patentability of abstract ideas would preempt others from using ideas that are in the public domain, see Bilski, slip op. at 13, so too would allowing the patenting of naturally occurring substances preempt the use by others of substances that should be freely available to the public. Thus, “a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law of gravity.” Chakrabarty, 447 U.S. at 309. These aspects are properly conceptualized as representing a public domain, “free toall men and reserved exclusively to none.” Id. (quoting Funk Bros., 333 U.S. at 130) (quotation mark omitted).
The qualities of these bacteria, like the heat of the sun, electricity, or the qualities of metals, are part of the storehouse of knowledge of all men. They are manifestations of laws of nature, free to all men and reserved exclusively to none. He who discovers a hitherto unknown phenomenon of na-ture has no claim to a monopoly of it which the law recognizes. If there is to be invention from such a discovery, it must come from the applica-tion of the law of nature to a new and useful end.
In Chakrabarty, the Court considered whether a human-made microorganism is patentable subject matter under section 101. 447 U.S. at 305. The microorganism in question was a bacterium that had been genetically engineered to break down crude oil. In concluding that the man-made bacteria was patentable, the Court observed that the claim “is not to a hitherto unknown natural phenomenon, but to a nonnaturally occurring manufacture or composition of matter.” Id. at 309. The Court went on to distinguish Funk Brothers on the ground that the Chakrabarty bacterium possessed “markedly different characteristics from any found in nature. . . . His discovery is not nature’s handiwork, but his own; accordingly it is patentable subject matter under § 101.” Id. at 310 (em-phasis added).
Thus, it appears that in order for a product of nature to satisfy section 101, it must be qualitatively different from the product occurring in nature, with “markedly different characteristics from any found in nature.” It is far from clear that an “isolated” DNA sequence is qualita-tively different from the product occurring in nature such that it would pass the test laid out in Funk Brothers and Chakrabarty. The mere fact that such a DNA molecule does not occur in isolated form in nature does not, by itself, answer the question. It would be difficult to argue, for instance, that one could patent the leaves of a plant merely because the leaves do not occur in nature in their isolated form.

References: v. 
 § 101
 § 102
 § 103
 § 103
 § 112
 § 8
 v. 
 v. 
 § 101
 § 102
 § 101
 § 101
 v. 
 v. 
 v. 
 § 101
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 § 101
 § 101
 § 101
 § 102
 § 101
 § 101
 §101
 § 101
 § 101
 § 101
 v. 
 v. 
 § 101
 v. 
 v. 
 §101
 §101
 § 101
 § 101
 § 101
 v. 
 v. 
 v. 
 § 101