Workable solutions to the challenges of patenting an innovative process.

• Author: Hopkins, Jamie
• Position: I. Introduction through IV. The Future of Process Patents B. New USPTO Guidance on the MOT Test, p. 316-343

1. INTRODUCTION II. PATENT LAW IN THE UNITED STATES A. Questions Concerning Business Method Patents B. History of Patent Law III. STATUTORY REQUIREMENTS FOR PATENT A. State Street Clarifies the Process Claims Requirements B. In Re Bilski C. The Machine-or-Transformation Test D. Supreme Court Revalidates the MOT Test E. Dissent/Concurrence in Bilski--Are Business Methods Patentable? IV. THE FUTURE OF PROCESS PATENTS A. No Progress after Bilski B. New USPTO Guidance on the MOT Test C. Assessing the Testing Options for Process Patent Claims D. How Applicable is the Useful, Concrete, and Tangible Results Test? V. NEW HOPE? ASSESSING THE LIKELY IMPACT OF THE AIA A. Tax Strategy Patentability B. Post-Grant Review Process C. Transitional Post-Grant Review Process for Business Method Patents D. Current State of Business Process Patents VI. CONCLUSION: WORKABLE SOLUTIONS A. How Process Patent Claims Should be Judged in the Future: Reviving the Patent Act's "Useful" Language I. INTRODUCTION

   Over the past fifteen years, business method patents have been a focal point of judicial opinions, law reviews, and legislative reform, culminating in the Supreme Court's decision in Bilski v. Kappos (1) and the passage of the 2011 America Invents Act. (2) The so-called "rise" or "proliferation" of business method patents was kick-started in 1998 by State Street Bank & Trust Co. v. Signature Financial Group, Inc. (3), which set forth "the useful, concrete, and tangible results" test for determining the patentability of a business method. (4) However, the courts have continued to rework the tests for determining the patentability of business methods and the focus of patentability has shifted away from the United States Patent Act's ("Patent Act") language and towards the judicially created machine or transformation (MOT) test. (5) The applicability of these judicially created tests have been played out through a variety of high-profile lawsuits, such as Netflix v. Blockbuster (6), and patent filings from large financial and technology institutions such as J.P. Morgan, Lincoln Financial, and VISA (7). Additionally, the Bilski v. Kappos decision created significant confusion as to how the United States Trademark and Patent Office and courts should review the patentability of a business method patent. (8)

   This article explores the history of the Patent Act, examining what role, if any, the judicially created MOT test should play concerning the patentability of business methods. (9) Additionally, it delves into the current landscape of high profile companies seeking business method patents and what benefit these business method patents may provide. (10) Ultimately, two workable solutions to the current problems facing business method patentability after Bilski v. Kappos are presented in an effort to reinforce the natural language of the Patent Act, ensure the patentability of legal business method patents, and safeguard company directives to invest in new and innovative business methods. (11)

2. PATENT LAW IN THE UNITED STATES

   1. Questions Concerning Business Method Patents

      The Patent Act, 35 U.S.C. [section][section] 101 et. seq., focuses patentability of a process invention on the novelty and utility of specific characteristics of the claimed invention, and not on any particular subject matter category. (12) While the term "business method" is not specifically defined by the language of 35 U.S.C. [section] 101, the Patent Act does not imply or explicitly state that business processes should be generally included or excluded from patentability. (13) The statute instead embodies broad subject matter patentability policies demonstrated throughout U.S. patent law history. (14) As currently enacted, the Patent Act extends patent eligibility to "any process ... not 'some' or even 'most,' but all" processes that are not "a law of nature, natural phenomena, or abstract idea." (15) Furthermore, "process" has been broadly defined by the courts as "a series of acts." (16) As such, both case law and the AIA acknowledge the patentability of business methods. (17)

      Yet, the courts have failed to resolve the central question at the crux of the process patent debate, namely, whether business method patent claims should be treated like all other process claims. (18) Alternatively, should business method patent claims continue to be judicially directed into a non-statutorily defined subject matter exception to general patentability? (19)

      In addition to recognizing the general patentability of business processes, other problematic issues remain. (20) Most critically, "Should the Courts moderate the application of the Machine or Transformation Test ("MOT") that, despite the Supreme Court's ruling in Bilski v. Kappos, is consistently controlling and so restrictive as to preclude business method patent claims that are submitted under the Patent Act?" (21) Instead of relying solely on the MOT test, "Should courts adopt a broader and more patent friendly approach to determining the patent eligibility of a business process patent claim?" (22)

   2. History of Patent Law

      The United States has long been regarded as a leader in global patents and has consistently demonstrated pro-patent policies. (23) A Japanese official visiting Washington, D.C. at the turn of the 20th century to study the United States stated, "[w]e asked ourselves 'What is it that makes the United States such a great nation?' and we investigated and found that it was patents." (24) The first known process patent was granted to Samuel Winslow in 1641 by the Massachusetts State Court for a new method of making salt. (25) The U.S. Constitution, adopted in 1789, contained this pro-patent spirit. (26) The Constitution granted Congress the power "to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries." (27)

      To "promote the progress of science and useful arts," Congress was granted the power to legislate in the area of intellectual property. (28) In exercising control over intellectual property rights, Congress enacted patent laws to promote intellectual progress by "offering a right of exclusion for a limited period as an incentive to inventors to risk the often enormous costs in terms of time, research, and development." (29) Congress believed that these laws would have a positive effect on society through the creation and...