News

Patenting methods of doing business – the US Supreme court decides

A US Supreme Court decision supports the notion that software can be patented in the US, and that highly specific methods of doing business may be patented. Broad, abstract methods can no longer be patented in the US.

Traditionally, patentable inventions were tangible things

Computers, the internet and ‘the information age’ have caused problems for patent laws around the world. Patent laws are based on centuries of precedents, tracking the development of machines through the industrial revolution, the creation of new manufacturing processes and materials, through to the development of electronics in the twentieth century.

The patent laws developed in response to these technologies were based on the principle that patentable inventions were tangible things. This meant that the laws were ill equipped to handle intangible inventions—such as computer software and methods of doing business over the internet.

Overcoming the limitations

In 1998, The US Court of Appeals for the Federal Circuit (which is one level below the US Supreme Court) announced that an invention would be eligible for a patent if it involved a practical application and produced a ‘useful, concrete and tangible result.’

The decision threw open the doors to patents for inventions which had never been considered eligible for patents, including algorithms and abstract methods for doing business. The last decade has seen an explosion in applications for patents of this type.

US Supreme Court Decision (June 2010)

On 28 June 2010, The US Supreme court issued its decision in Bilski v Kappos. This decision has confirmed that it remains possible to obtain a patent for a method of doing business but has emphasised that this can not be just an abstract idea, nor an abstract idea arbitrarily linked to a particular field.

The decision suggests a useful clue in determining whether a process is eligible for a patent—ask whether it is tied to a particular machine, or if it transforms a particular article into a different state or thing. (It stresses that this is not an absolute test, but suggests that it will be rare that a process will be eligible for a patent if it does not meet these requirements.)

The decision supports the notion that software can be patented in the US, and that highly specific methods of doing business may be patented. Broad, abstract methods can no longer be patented in the US.

Please contact Armour IP for further information.