Medical Device Daily Washington Editor
WASHINGTON — The method patent case of Bilski v. Kappos, renamed now that the Patent and Trademark Office has a new director, finally made its way to the U.S. Supreme Court yesterday in a case that was widely anticipated and vigorously attended. Whatever the outcome, makers of diagnostics might have taken heart to hear the government representative inform the court that Bilski is not a case that the government believes applies to medical technology.
Much of the attention during the hearing was on how the Bilski application parallels the question of patentability of computer software, but the justices also reviewed one of the legs of patent law that has come up frequently in discussions of Bilski, namely how the application stands up in the "machine-or-transformation" test.
It is too early to attempt to read tea leaves of a case the court might not decide until well into spring of 2010, but the impression is that while the court has an open mind where method patents are generally speaking, it is not impressed with the Bilski patent.
Presenting on behalf of Bilski was J. Michael Jakes of the law firm of Finnegan (Washington), who wasn't very far into his presentation when the jurists began peppering him with questions. Jakes opened his remarks with the comment that the application of the "rigid and narrow machine-or-transformation test for all patent-eligible methods" by the Court of Appeals for the Federal Circuit (CAFC) "should be reversed." He also asserted that the requirement "that any and all methods must be either tied to a particular 'machine or transformation' specific subject matter doesn't find any basis in either the language of Section 101 [of the Patent Act of 1952] or anywhere in the patent statute."
Justice Steven Breyer pressed Jakes for details, remarking that "every successful businessman typically has something" that has proved essential to the success of the operation. He posed a scenario in which the businessman "thinks of a new way to organize" or "a new thing to say on the telephone" and asked Jakes whether "anything that helps any businessman succeed is patentable because we reduce it to a number of steps [and] explain it in general terms?"
Jakes responded, "it is potentially patentable."
Breyer then asked whether the Framers of the Constitution "would have wanted to require anyone successful in this great, vast, new continent – because he thinks of something new – to have had to run to Washington and to force any possible competitor to do a search and then stop the wheels of progress unless they get permission?"
Jakes indicated that this was not his view, but a following question cut him off beyond the response, "no, Your Honor. I wouldn't" take that view.
Chief Justice John Roberts also chimed in on the business method eligibility issue, noting that business methods "have been going on for centuries." He prodded Jakes to tie the Bilski method to a machine-or-transformation test, asking "what are the physical steps?"
Jakes observed, "it does take a person" to make calls to buyers and sellers of the commodity involved in the Bilski patent and obtain the buying and selling positions of those parties. This information would then have to be manipulated by an analysis that would lead to a hedged position on the commodity in question. "If it is a series of steps, it is patentable" so long as it provides an economically useful outcome, Jakes concluded.
Justice Antonin Scalia pressed the issue of economics, asking Jakes "why wasn't horse training patented" at a time when "our entire economy was based on horses?" Jakes' response was that enforceability of such a patent might be an issue, but acknowledged that horse training as a process could conceivably be patented.
Scalia made a point later in the hearing with which he highlighted a question that could prove decisive in the outcome. During the presentation of the government's case by Malcolm Stewart, deputy solicitor general at the Department of Justice, Scalia hinted at the question of whether the Bilski method can be patented if it can be employed with pen and paper.
Stewart had mentioned that the State Street patent benefited as a business method patent partly because it required the use of a computer to employ the method. Scalia then asked: "Also you could say business methods apart from machines are not patentable. How about that?" Unfortunately, Stewart's response was cut short by a question from another justice.
Conversely, Justice Breyer hinted that one view of method patents might hold that anything that can be reduced to a set of instructions that can be executed by a personal computer is implicitly patentable. Stewart acknowledged, "we recognize that there are difficult problems out there in terms of patentability of software innovations and medical diagnostics."
However, he also said that DoJ "thought that this case would provide an unsuitable vehicle for resolving the hard questions because the case doesn't involve computer software or medical diagnostic techniques." Consequently, the Department assumed that the court "will decide this case, and most of the hard questions [regarding software and diagnostics will] remain unresolved."
Mark McCarty, 703-268-5690