Intellectual Property Directions

I have never liked so-called business methods patents (in fact, I dislike a majority of “methods” patents). Today the Supreme Court hand down its ruling on the Bilski case, upholding the USPTO’s rejection of Bilski’s patent application on “101″ grounds. That is, the PTO rejected the application because the claimed invention did not address a patentable subject. Specifically the Court ruled that Bilski’s application was an attempt to patent an abstract idea - a catagory that has long been ruled not subject to patenting.

Many people, myself included, had been hoping that the Supreme Court would address the patentablity of software and business methods at a broader level since there has been much huffing and puffing on the topic of should business methods as a class and should software as a class be patent eligible. Unfortunately we will have to wait until, perhaps, the Congress acts since the Court explicitly said it:

… declines to impose limitations on the Patent Act that are inconsistent with the Act’s text. The patent application here can be rejected underour precedents on the unpatentability of abstract ideas.The Court, therefore, need not define further what constitutes a patentable “process”…

In effect, the Court said that if Congress didn’t like the way the PTO was defining a patentable process then Congress can amend the patent statutes.

An advertisement in a muscle magazine for a dietary supplement was all it took to invalidate Iovate’s licensed patent. Iovate is the licensee of U.S. Patent 6,100,287, which claims the use of nutritional supplements containing a ketoacid and an amino acid to enhance muscle performance or recovery from fatigue. When they sued a competitor, BSN, Inc., for infringement for selling a competing supplement the courts found that an ad for Weider’s VICTORY^TM Professional Protein published in Flex magazine was an anticipating printed publication of the invention. That is, the ad disclosed every limitation of the claimed invention.

 I often tell clients that the value of a patent is only determined if someone cares enough to want to infringe it. And if someone does find it worthwhile to infringe, you can be sure they will invest in finding any invalidating prior art they can. That’s too late for you to find out your patent should never have been allowed; you should have done research up-front, before investing in a patent application. Like the old oil change ad said, “you can pay me now, or you can pay me later”.

Most people understand the importance of doing a patent search before investing heavily in the development of a new product. Some people understand the value of doing a patent search before investing in the patent application process. But too few people understand that reviewing the NON-PATENT prior art before investing in that patent application is also an important up-front investment to make before plunging into the patenting process.

In fact, in many situations it may be more important to look at the non-patent prior art. The patent examiner, bless his or her heart, will at least do some sort of search in the US Patent database. If you’ve filed under the Patent Cooperation Treaty, you’ll get a search of various international patents. But you’re pretty much on your own when it comes to bringing forth the non-patent prior art. And that makes sense - after all, you are the expert in the field of your invention, aren’t you?

Clients’ first reaction to this advice is almost uniformly: “But then I might not get my patent!” True, true. But if you do get a patent and, like Iovate, a competitor infringes, don’t you think he will find that prior art and turn your patent into an expensive piece of wallpaper?

How confident are you that your patents will stand up to a court challenge?

Like a vampire rising again from the grave, “business method” patents don’t want to go away without a fight.  It was just a year ago that the Court of Appeals [CAFC] ruled that Bilski’s “business method” for hedging commodities was not patentable subject matter. As much as I wished that the matter was dead, there are too many business method zombies, sucking the blood out of the patent system with their “inventions”, to let it go.

Last week the Supreme Court heard arguments in the matter of “Bilski” and it seemed to observers of the Court that Bilski may finally be dead but that the contorted CAFC reasoning may be thrown out as well. As I wrote last November (IP Directions 11/2/08), the very basis of the US patent system is the Constitutional phrase: “Congress shall have power … to promote the progress of science and useful arts…” Frankly, I doubt the founders would consider hedging risk in commodity trading part of science and the useful arts.

But the CAFC didn’t want to use such a subjective criterion in their decisions, so what is the test of process patentability? According to the Bilski decision, there is a two-part “machine-or-transformation test” for eligibility of process claims. First, eligibility may be demonstrated if a claim “is tied to a particular machine or apparatus.” Second, and alternatively, eligibility may be shown if a claim “transforms a particular article into a different state or thing.” Also note that the “tie” to a machine or apparatus must be a meaningful limitation in the claim.

I would have preferred to see methods of performing business/financial operations per se be declared unpatentable as not being part of science or the “useful arts” and damn the subjectivity torpedoes. As with “obviousness”, the courts will never produce a objective definition of an inherently subjective issue, so why try. If a patent applicant feels the patent office has inappropriately reject his or her application over a subjective issue, well, that’s why we pay the justices the big bucks - to apply their “wisdom”.

How about you - any blood-sucking business methods in your patent plans?

Many colleges and universities are back in session now so it only seems fitting to talk about the lesson that Blackboard, Inc. learned last month. Blackboard provides internet/intranet based education-support systems. For example, Universities use Blackboard for professors to post course material, collect assignments and report grades. Recently they sued Desire2Learn for patent infringement over the different roles a user can have with a single login. What Blackboard learned was that they had not fulfilled the teaching role required of them to have a valid patent claim.

If you enroll in “IP101″ at the school of patenting, one of the first things you’ll learn is that a patent is supposed to be a teaching document. I’ve always advocated that you think of the patent system like a contract in which society and the inventor exchange quid pro quo. In return for controlling the use and sale of the invention described in the claims, you, the inventor, must teach society the details of your invention in the specification.

In the case of Blackboard, they claimed, among other items:

“…a server computer… comprising:
…
means for assigning a level of access to and control of each data file based on a user of the system’s predetermined role in a course;
…

The problem for them was their teaching of the “means” for assigning a level of access etc. Both in the specification and in testimony in court, Blackboard essentially said that any hardware or software that assigns levels of access is the “structure” for providing the function. The Court has ruled before, and did so again here, that making a general reference to, say, a general purpose computer with appropriate programming does not provide an adequate description of how to make the invention.

The court noted:

“[t]he point of the requirement that the patentee disclose particular structure in the specification and that the scope of the patent claims be limited to that structure and its equivalents is to avoid pure functional claiming.” … Without so limiting a claim, we noted, “the patentee has not paid the price but is attempting to claim in functional terms unbounded by any reference to structure in the specification.”

Teaching how to make or use your invention in definite terms is always a requirement, but it is particularly true for computer based inventions. Blackboard argued that putting together their “access control manager” was well known to someone of ordinary skill in the art, and so it is, but the court pointed out that the question was not one of enablement but of definiteness: “The question before [the court] is whether the specification contains a sufficiently precise description of the “corresponding structure” to satisfy section 112, paragraph 6, not whether a person of skill in the art could devise some means to carry out the recited function.”

The lesson here is to take your role as teacher seriously and explain the details of your invention carefully to avoid becoming a teacher wearing an invalidity dunce cap.