Internet Inventions Covered by Patent Law, States Supreme Court
Practical eCommerce: Please outline the Supreme Court's decision on the Bilski case.
Kovelman:"The Bilski choice is a substantial situation in patent law for many reasons. Mr. Bilski is an inventor and he had filed a patent application for a variety of methods associated with commodity buyers and the energy economy and how they can hedge against the risk of price shifting. During prosecution before the Patent Office (the process by which you receive a patent), the examiner rejected Bilski's claims by asserting that it was only an abstract idea or a mathematical formula, and denied it rather than being patent-eligible subject matter. After some back-and-forth involving the patent examiners, Mr. Bilski went up the Board of Patent Appeals and Interferences, that's the body of Patent Offices for determining appeals against the examiner, and determined that it wasn't patentable qualified subject matter.
See our products:
- Magento 2 pos system
- bigcommerce pos software
- woocommerce pos system
- shopify pos system
- msi inventory management
"In the Patent Office, Mr. Bilski subsequently filed with the Federal Circuit, which is an appellate court that hears appeals in these sorts of matters. The Circuit court did something which was fairly unexpected. They basically came down and restricted what was patent-eligible subject matter to what was known as the machine-or-transformation evaluation, which means that you need to tie your method claims to a particular machine, or you need to show some kind of physical transformation, like such as in a chemical process from compound A to compound B. This was a big surprise to a lot of people and Mr. Bilski then appealed it up to the Supreme Court.
"The Supreme Court today issued their view, which the vast majority opinion found several important problems. One, business methods are subject to patent-eligible subject matter. The Federal Circuit misapplied the Supreme Court's precedence in making their determination that the machine conversion test is the only test--it isn't. And three, the Federal Circuit misapplied statutory interpretation of Section 101, which states that any procedure is eligible for a patent if you meet the remaining requirements of this statute. Therefore, in a sense, the Supreme Court essentially confirmed the [Bilski] conclusion, but at the exact same time they discovered that the test applied by the Federal Circuit was the improper evaluation employed in this region."
PEC: Would Internet-related patents, such as search algorithms or Amazon's 1-Click technologies, fall in the business method patent class?
Kovelman:"I believe the Supreme Court left it open, really. They did state clearly that Section 101 read by its own definition is any procedure and that it had to be a widely stated statute to be able to encompass engineering that Congress is yet to imagine. Justice Kennedy, who delivered the opinion of the Court, really does talk about algorithms and computers and matters of that nature. He states that, to restrict the machine-or-transformation evaluation as the sole evaluation (that is more applicable to possibly the industrial era as opposed to the information age), would basically create lots of uncertainty regarding the patentability of software, diagnostic medical methods, and creations based on terminal applications, data compression, manipulation of digital signals. Therefore, what I believe the Court is saying is machine transformation is not the only test, but they did not quite offer enough information about what will be the appropriate test. Therefore, while the Federal Circuit didn't follow precedent of the Supreme Court and restrict it to the machine conversion evaluation, the Supreme Court left it open for the Federal Circuit to include in additional restrictions or conditions or requirements so as to ascertain what is patentable subject matter concerning business methods.
"So, I guess the short answer is business methods are clearly covered, based on the evaluation of this Court. But, what actually will constitute a process that's more than an abstract notion, mathematical formula or natural phenomenon will be left to the Federal Circuit and likely will be a couple of years until people have any real certainty."
PEC: Can Congress get involved to clean up any of that?
Kovelman:"The Supreme Court believes that Congress essentially developed the very best decision for them. They think 101 supplies any procedure. Then the Supreme Court went on and explained that Section 273 really discusses business techniques, and that if Congress didn't intend for Section 101 to be covering business procedures, then you wouldn't have that language in Section 273. To construe it otherwise would basically make 273 meaningless, which basically is a statute that deals with a defense if you are doing any methods that they say is a way of doing or conducting business connected to somebody creating an infringement claim against you for patent infringement.
"So, can Congress change this? They certainly can. As we've previously discussed, there is the Patent Reform Act. If they disagree with the Court, they could produce some new regulations and legislation. Butfrankly, I think they're going to leave it for the Courts to compose their own conclusions and determine where this goes over the next few years."
PEC: Does this view pose any concerns that would affect Internet-related entrepreneurs, applications developers, and those type of businesspeople?
Kovelman:"Well, again, I think it's clear business methods are now patentable qualified subject matter. They might not be allowed as patents, but I think it's pretty obvious that the Court has stated that business methods will be patentable.
"The next question is what is going to be the test. If someone wants to put a patent on computer algorithms, email programs, or other various Internet applications, they ought to go ahead and file. They ought to attempt to draft their promises to the extent it is not unduly restricting so that they can get beyond the Patent Office using the machine conversion test. Those men and women who have patents issued can breathe a sigh of relief that they still have a chance of getting their patents to be enforceable and essentially applicable towards possible infringers according to today's decision. It left the door open."
PEC: Are there any present technology-related, business method patents which this choice would in any way threaten, in your opinion?
Kovelman:"I do not know if it would hurt them. The Court explained that this is the not the only test, but left the door open. Thus, it's not like they came , as Justice Stevens did in his descent, and said,'I'd be completely against business method patent. I believe it's something that's excluded.' And, he goes through a rather tortured reading of legislative history and previous instances to come up with this choice.
"I believe that the Court is where it was previously in the Department 101, which defines patentable subject matter, is quite broad and must be dynamic and allow for new technologies to be applied. Broadly, there is no patent on the market, off the top of my mind, that's going to be hurt by this decision at this time."
See also:
https://www.connectpos.com/make-use-of-integrating-a-store-locator/
https://www.connectpos.com/best-valentines-day-retail-idea/
https://www.connectpos.com/case-study-jat-clothing/
https://www.connectpos.com/ecommerce-pricing-comparison/
https://www.connectpos.com/digital-marketing-ideas-to-increase-footfall-at-your-physical-stores/
https://www.connectpos.com/what-does-commercetools-do/
https://www.connectpos.com/top-commercetools-integration/
PEC: Anything in the choice that surprised you?
Kovelman:"I was amazed that Justice Kennedy really wrote it. I expected to see Justice Stevens write it as one of his last remarks as a Supreme Court Justice. Additionally, it is surprising that the Court came out so obviously to state that business methods are patentable subject matter. And then eventually the Supreme Court left it open and said this isn't the sole test. They didn't offer any extra test. We didn't believe they would, but they left it open clearly that the Federal Circuit isn't likely to be restricted by whatever the Supreme Court said, besides this isn't the sole test, and left it open for the Federal Circuit to return and see if they can get it right.
"The Justices have made it fairly clear they do not enjoy the wide scope of several patents. And, I think what happened, and a part of the delay isthey were trying to get their heads about how to do this. They did not really like how they had to return, but it came down with a flexible approach because of what the statute says and they applied what the statute says. And, finally, Justice Stevens said if Congress does not like it, it is up to them. They could change this."
PEC: So, Justice Stevens was against business method patents as a wide scope?
Kovelman:"[Yes] He was very, very obvious. I believe he said,'More precisely, even though a procedure isn't patent eligible simply because it's helpful for conducting business...' He claimed that it simply refers to a way of conducting business, and doesn't qualify as a procedure under Section 101. That's his choice. Had he composed the majority, we would have had a very different conversation."
PEC: Anything else on your mind for our readers?
Kovelman:"Anyone who's interested in protecting their [patent] rights ought to proceed and assume that it is kind of a status quo. We have gotten some caution, but there is definitely some uncertainty and a few unanswered questions. Based on how you wish to secure your technology, you need to proceed like method patents will continue [to be] around for some time."
Comments
Post a Comment