"A summer of anticlimax"
When penning an editorial which will be read some weeks after the event, the mood of the moment—which determines its content—is hard to recapture. The mood which governs this editorial is one of disappointment verging on anticlimax. Six-times-Wimbledon winner Roger Federer has been eliminated ahead of time from the tournament he was favoured to win, joining Venus Williams in the spectators' gallery. The fancied Italian and French teams have made their graceless exits from the soccer World Cup. The G8 and G20 meetings have failed to achieve any objective other than surviving the ritual demonstrations that attend their every gathering. And, in the biggest anticlimax of all, the US Supreme Court has given its long-awaited judgment in In re Bilski.
Early expert comment received from pundits on both sides of the Atlantic has been largely along the lines of ‘business as usual’. Indeed, this was the headline of one global practice's news release and it was much the same message that IP auctioneer Ocean Tomo has been putting out since the decision of the Court of Appeal for the Federal Circuit held the disputed business method patent invalid in 2008. What it seems to mean is that, as before, some business methods will continue to be patentable while others are not.Footnote on Bilski: Regular JIPLP contributor and OUP author Charles R. Macedo has been invited to write an article for next year which reviews the impact of Bilski on legal decisions in the United States over the first 12 months following the handing down of that decision.
The Justices agreed that, on the facts before it, the Federal Circuit court was right to hold the Bilski patent invalid. They could not, however, agree, in wider terms, as to the correct judicial yardstick by which the validity of patents of this type was to be measured. Depending on your perspective, the words of the US patent code are (i) woefully imprecise and ill-equipped for determining the patent-eligibility of types of invention that the legislators could never have imagined, or (ii) magnificently flexible in their scope for interpretation in that very small number of disputed cases in which the boundaries of patent-eligibility must be identified.
Much turns in the USA upon the ‘machine-or-transformation’ test, which the Federal Circuit court applied and which, according to a concurring minority of the Justices, was not clearly identified as the ground on which the majority based its decision. In simple terms, this requires that a patent-eligible process either (i) be tied to a particular machine or apparatus or (ii) be able to transform a particular article into something different. These words do not appear in the US patent statute, and are therefore subject to fewer interpretational constraints. Nor, however, did the test spring fully formed into the mouths of the judiciary: it is the result of a long-evolving strand of judicial precedent that can be traced to its 19th century roots and which has reached us today through a trilogy of earlier Supreme Court decisions. These, as referred to by American practitioners today, sound rather like the name of an American law firm: Benson, Flook and Diehr.
The ‘machine-or-transformation’ test has much to commend it. It is a neat slogan which is easy to memorize. Its application to the facts of individual patent applications appears to produce much the same outcome—so far as this technical novice is concerned—as the more amorphous, less memorable, and confusingly articulated tests that arise from a synthesis of the decisions of the European, German, and UK patent granting authorities. The worst effects of its misapplication are guarded against by the requirements that even business method patents be novel and non-obvious. Best of all, it provides an intelligible rule of thumb for business investors at the point at which they decide whether to support the commercial development of a new process or not.
There is at present no internationally agreed standard regarding patent-eligibility of business methods, and it would be no exaggeration to say that we are not about to see one. When most jurisdictions provided little or no protection for such inventions, to say that the USA was out on a limb in granting patents for them, or that it had simply ‘gone too far’ was an easy way to score a debating point. However, it is from the USA that most of the business methods we now employ appear to have originated, whether because of, or despite, the availability of legal protection. If, having attracted the attention of the world even momentarily, Bilski does not help foster a wider debate and a broader acceptance of business method patents, the sense of anticlimax will be very real indeed".