Supreme Court Rules Narrowly In Bilski; Business Method & Software Patents Survive

from the so-much-for-that dept

Mon, Jun 28th 2010 8:01am — Mike Masnick

As I expected it appears that the Supreme Court has ruled somewhat narrowly in the Bilski case (pdf), which many had hoped would end the scourge of business method and software patents. Instead, the court effectively punted the issue. Technically it affirmed the overall decision from the Federal Circuit that Bilski's specific patent was invalid for being way too broad, but much more importantly for everyone else, it rolled back the Federal Circuit's "machine-or-transformation" test, which many believed effectively ruled out pure software patents. Instead, the court said that the courts "should not read into the patent laws limitations and condi-tions which the legislature has not expressed." In other words, business method and software patents survive.

I'm sure there will be much more analysis of this decision going forward, but on a first pass, despite "affirming" the Federal Circuit ruling, this one looks like a big win for supporters of business method and software patents. Basically, the court just said it would rule on this particular patent and not make any real statements on the overall patentability of business methods or software. So, in effect, it's no real change on how the patent system works.

Update: Many people had expected that Justice Stevens (who is retiring) would write the majority opinion. Instead that was done by Justice Kennedy. Justice Stevens' concurring opinion, however, is a pretty strong rebuke of the reasoning in the majority opinion, even if he agrees with the final outcome. It appears that Stevens does think that business method patents are a problem, but couldn't convince enough members of the court to come out and say it.

Since at least the days of Assyrian merchants, peoplehave devised better and better ways to conduct business. Yet it appears that neither the Patent Clause, nor early patent law, nor the current §101 contemplated or waspublicly understood to mean that such innovations arepatentable. Although it may be difficult to define withprecision what is a patentable "process" under §101, the historical clues converge on one conclusion: A business method is not a "process."

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: bilski, business method patents, patents, software patents, supreme court

31 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

NAMELESS.ONE, 28 Jun 2010 @ 8:06am

USa setting up for EPIC FUTURE FAIL
rest of world will do the innovating and share it and you will be left in the UTTER DUST
[ link to this | view in thread ]
SWEET!, 28 Jun 2010 @ 8:08am

Anyway we can get it
yeayyyy... Oh well, congress will make effective laws any day now! I can feel it in my bone.
[ link to this | view in thread ]
Dark Helmet (profile), 28 Jun 2010 @ 8:11am

Re: Anyway we can get it
"I can feel it in my bone."

You might want to rewrite that....
[ link to this | view in thread ]
Joe, 28 Jun 2010 @ 8:22am

embedding docs
Separate issue, but I'm really of mixed minds when it comes to these embedded flash paper docs. They certainly add depth to the article in question but i think they are not good for archival purposes. On several occasions, I've looked back in the Techdirt archives on a certain topic and it's a pretty safe bet that in 5 years time some of these companies that offer the embedded flash service won't be around. I'd suggest looking at still using flashpaper but hosting the docs locally unless other issues (bandwidth, cost/benefit etc) make that prohibitive. Oddly, I don't feel the same about the occasional YouTube video. That does feel like it's not going anywhere.
[ link to this | view in thread ]
:Lobo Santo (profile), 28 Jun 2010 @ 8:47am

Re: Re: Anyway we can get it
That might be the perfect wording, actually.
; P
[ link to this | view in thread ]
Anonymous Coward, 28 Jun 2010 @ 8:48am

Since it's Monday I predict TAM will say something stupid.
[ link to this | view in thread ]
Sucker punched, 28 Jun 2010 @ 8:54am

The smell of scum lingers on
And so it is. The scum of the earth - the patent trolls, shall continue to prosper off the fruits and labor of the hard-working souls. This smells worse than the oil spill. Is there not a pulse to be found on this court?
[ link to this | view in thread ]
darryl, 28 Jun 2010 @ 9:14am

Law sucks when you want to break it.
So the courts have ruled, and even then you dont like it, you seem to think that you as a non-steakholder in these issues are right, and everyone else, including the highest courts are wrong !.

Oh well, each to their own, but trying to lump software patent issues with a business patent case backfired bigtime dont you think.

You would have been better off shutting up, and not bringing to the courts attentions things such as the machine transformation clause.

Which you have now lost, so not only did software patents reformers failed in compelling the courts that they are right, they have shown the courts that they are wrong, which is worse.

So as a result you lose the machine transformation, and you see the courts stating quite clearly that they do not think the way you do, and that patents and copyright, and IP laws in general are working !.

"rest of world will do the innovating and share it and you will be left in the UTTER DUST"

yea right, if by innovation you mean copying off what someone else has done, then yes, your right.
But if you can actually INVENT something yourself, not just copy, you would want some protection of your brillant idea.

Or would you rather some big business just take it off you and screw you over.
But you dont have to argue with me, try arguing with the surpreme court... Oh thats right !! you did that, how did that work out for you then .. oh thats right... not so good.

It must really suck when courts actually listen to those to actually create new and innovative things, who actually improve our lot in life, and make it a bit easier, and the same courts disregard those that just want to take that innovative thing and copy it for a quick buck.

well it must suck for some, the uncreative ones that is.
[ link to this | view in thread ]
Dark Helmet (profile), 28 Jun 2010 @ 9:19am

Re: Law sucks when you want to break it.
"you seem to think that you as a non-steakholder"

Fail. When rulings transverse national law, we're ALL stakeholders (but thanks to your typo, I know what I'm having for dinner tonight....)

"well it must suck for some, the uncreative ones that is."

It always strikes me how uncreative the process for which creative people rely on to make money off of their creative works....
[ link to this | view in thread ]
JEDIDIAH, 28 Jun 2010 @ 9:22am

Re: Law sucks when you want to break it.
>> "rest of world will do the innovating and share it and you will be left in the UTTER DUST"
>
>yea right, if by innovation you mean copying off what someone else has done, then yes, your right.
>
>

Yup. Just like Henry Ford and Thomas Edison.

That's why there are patents in the first place. They are MEANT to be copied. It's the expectation that people will share interesting ideas in exchange for eventually losing them.

Improving other people's ideas is where "innovation" comes from.

The real problem is the question of whether or not such patents are actually inventive. Patents stifle innovation for the duration of the patent. The damaging potential of patents should not be considered lightly.
[ link to this | view in thread ]
ChurchHatesTucker (profile), 28 Jun 2010 @ 9:30am

Re: USa setting up for EPIC FUTURE FAIL
"rest of world will do the innovating and share it and you will be left in the UTTER DUST"

This was my response to the 'threat' of communism. I encourage it! Do that central planning thing and the five year plans and all that! See you in the market.

Then I realized that the game is rigged no matter which side you're on. "Free" markets generally only operate in one direction, etc.

So don't get too complacent. Your masters will screw the pooch as well.
[ link to this | view in thread ]
Florian Mueller, 28 Jun 2010 @ 9:33am

Bilski decision doesn't invalidated even one software patent
"Unfortunately, the Supreme Court delivered an opinion that doesn't help the cause of partial or complete abolition of software patents at all."

"[T]he court's majority position is about the most liberal reasoning that it could have been. Only a decision to uphold the Bilski patent could have been any less restrictive.
"Simply put, the Supreme Court's decision does not do away with even one software patent that already exists, nor does it raise the bar for the future."
"The decision announced today makes it clear that a majority of the Supreme Court wanted to give the abolition of even only a small percentage of all software patents the widest berth possible."

"This US decision is even more disappointing when taking into account the global trend." [then mentions political process in New Zealand and court decision in Germany]

"The position that software patents should be abolished isn't nearly as popular among judges and politicians as it is in the free and open source software community."

See fosspatents.blogspot.com for full analysis.
[ link to this | view in thread ]
Feigin - Patent Attorney NJ NY, 28 Jun 2010 @ 9:33am

Find the relevant parts of the opinion here...
I pulled out the good quotes so you can skip all 40 pages of Steven's diatribe: http://PatentLawNJ.com/index.php/business-method-patents---bilski-supreme-court-decisio n
[ link to this | view in thread ]
Anonymous Coward, 28 Jun 2010 @ 9:34am

at the end of the day, the justices got it right. they struck down artificial constructs that did not exist in the law, and pretty much sent everyone back to square 1 on the issue. if the people want to specifically get rid of business process or software patents, they will have to get the congress, house, and president to sign legislation that changes the rules as written. that cannot and should not be done by the courts.
[ link to this | view in thread ]
vivaelamor (profile), 28 Jun 2010 @ 9:39am

Re: Law sucks when you want to break it.
"So the courts have ruled, and even then you dont like it, you seem to think that you as a non-steakholder in these issues are right, and everyone else, including the highest courts are wrong !."

If its even relevant to whether someone should comment on an issue, why is Mike less of a stakeholder than anyone else? Not only is he a businessman; who, at least partly, relies on software development; but he also tries to facilitate business innovation.

"Oh well, each to their own, but trying to lump software patent issues with a business patent case backfired bigtime dont you think."

Backfired how? It would seem the issue was left unresolved. Back to square one hardly seems like a backfire. Uh, forgive the mixed metaphor. I don't do cars very well.

"Which you have now lost, so not only did software patents reformers failed in compelling the courts that they are right, they have shown the courts that they are wrong, which is worse."

Would it be too much to ask for you to read at least part of the article, instead of just the title and making assumptions from there on?

"yea right, if by innovation you mean copying off what someone else has done, then yes, your right.
But if you can actually INVENT something yourself, not just copy, you would want some protection of your brillant idea."

This whole issue is about people getting patents for innovations, rather than inventions. You seem to be arguing against people that you agree with.

"It must really suck when courts actually listen to those to actually create new and innovative things, who actually improve our lot in life, and make it a bit easier, and the same courts disregard those that just want to take that innovative thing and copy it for a quick buck."

Didn't you just make the distinction between invention and innovation? Now you're saying something that conflicts with what you said barely a paragraph above.
[ link to this | view in thread ]
Peter Friedman (profile), 28 Jun 2010 @ 9:45am

there are some good reasons to like the narrowness of the opinion
I wish the Supreme Court more often would do what common law courts are supposed to do -- decide the case before them without pronouncing broad rules that will constrain lower courts in a wide variety of situations that might be distinguishable in important ways from the case before them, ways that the parties before the court don't care about. In fact, good lawyers know that the broad rules that courts declare are always subject to being exceptions and modifications in later cases that raise facts that implicate issues and interests the earlier case didn't.

So I wouldn't react the way you do, Mike -- that this is a big "win) for business method patents. It's more like a foul ball. It's only a win in that the patents aren't dead for now. In stating that the law doesn't preclude business method patents, the Court isn't saying that there's a business method that's patentable. It's just not ruling out the possibility. And Stevens' concurrence I think will prove to be persuasive when it comes to lower court consideration of more business method patents.

Do you think there are any business method patents that are sufficiently different than the one rejected by the Court that might cause lower courts problems?
[ link to this | view in thread ]
Anonymous Coward, 28 Jun 2010 @ 9:54am

It seems like certain parts (II-B-2 and II-C-2) of the majority decision only have 4 votes; I'm a little confused what exactly is in those parts though...
[ link to this | view in thread ]
Jose_X, 28 Jun 2010 @ 10:15am

http://www.groklaw.net/article.php?story=20100628100422167
[ link to this | view in thread ]
Anonymous Coward, 28 Jun 2010 @ 10:33am

Re: Law sucks when you want to break it.
People independently come up with similar ideas. There is nothing special about coming up with an idea all on your own, even if it's something someone else has thought of. It's natural. Patents steal the right for others to implement ideas that they independently came up with.
[ link to this | view in thread ]
Patrick Richards, 28 Jun 2010 @ 10:54am

A welcome decision
Judge Rader had it right in his dissent all along - this is just another example of a bad patent being an excuse to make bad patent law. Thank you to the SC for not taking the bait.

My further thoughts can be found here: http://www.richardspatentlaw.com/2010/06/28/bilski-v-kappos-supreme-court-opinion/
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

angry dude, 28 Jun 2010 @ 11:08am

For all of you, anti-"software-patent" activists
/"\
|\./|
| |
| |
|>~
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

angry dude, 28 Jun 2010 @ 11:13am

one more time
....................../´¯/)
...................,/¯../
................../..../
............/´ ¯/'...'/´¯¯`·¸
........./'/.../..../......./¨¯\
.......('(...´...´.... ¯~/'...')
........\.................'.../
.........''...\.......... _.·´
...........\..............(
.............\.............\....
[ link to this | view in thread ]
Anonymous Coward, 28 Jun 2010 @ 12:00pm

Re: one more time
Not that I necessarily agree, but your "comment" is an interesting "read".
[ link to this | view in thread ]
Art (profile), 28 Jun 2010 @ 2:38pm

Screw Alito
It's really too bad that this didn't come up before O'Connor retired. I can't see her voting to uphold business method patents. As usual, Kennedy makes the wrong choice, though I'm pleasantly surprised about Sotomayor, given that her ex-husband had a vested interest in upholding software patents.
[ link to this | view in thread ]
abc gum, 28 Jun 2010 @ 6:17pm

Re:
"that cannot and should not be done by the courts."

You need to go back to civics
[ link to this | view in thread ]
Anonymous Coward, 28 Jun 2010 @ 6:20pm

Re: Re: one more time
... and his mother had such high hopes for him
tis sad.
[ link to this | view in thread ]
Hephaestus (profile), 29 Jun 2010 @ 7:49am

Re:
"Since it's Monday I predict TAM will say something stupid."

Dude thats true any day of the week
[ link to this | view in thread ]
Handal Morofsky, 15 Feb 2014 @ 1:20pm

Re:
Well said.
[ link to this | view in thread ]
Anonymous Coward, 19 Jun 2014 @ 12:22pm

Bilski and Congress
It didn't seem to me that SCOTUS punted on Bilski but instead handed it off to Congress. SCOTUS reasoned that technological advances had outgrown current Patent legislation by so much that it was time for Congress to step in. Naturally Congress has yet to pass legislation addressing software/process patent issues.

No matter how small, I'm glad that SCOTUS did something - I've not read the decision yet but am guessing that creating precedent was done somewhat reluctantly.

Unfortunately this effectively rewards Congress for not doing what it is supposed to do; I guess SCOTUS hasn't done a lot of child-raising to know that's a bad idea.
[ link to this | view in thread ]
SaketaSharePoint (profile), 3 Mar 2020 @ 12:38am

SharePoint Migration tool
https://saketa.com/migrator/
Saketa Migrator - The best SharePoint migration tool, helps you migrate data from all SharePoint versions, Office 365, cloud and File Systems. Its dedicated Security manager helps combat all security threats during migration.
[ link to this | view in thread ]
RunScrumMSSharepoint (profile), 15 Aug 2020 @ 1:44am

Project Management Solution for Agile Teams
https://runscrum.io/en/sharepoint-agile-release-trains.html

If you are looking for a Project Management Solution for your Agile Team... Look no further. RunScrum helps you run all of your agile projects in one place, with the runScrum SAFe® features, ART Dashboard & User Management - workflows for agile teams no longer poses a challenge.
[ link to this | view in thread ]