To promote innovation, patents are granted for new, unobvious, and useful inventions. 1 Once granted, a patent gives its owner the right to exclude others from making, using, offering for sale or selling the invention throughout the United States, or from importing it into the United States. 2
Currently, one of the most unsettled questions in patent law is what subject matter qualifies for a patent. More specifically, the question is whether methods for conducting business, which are often implemented by computers, are patentable.
Since 1793, the categories of subject matter that qualify by statute for a patent are: machine, article of manufacture, composition of matter, and process (which was known as “art” prior to 1952). Courts, however, have fashioned three categories of judicial exceptions that are not patent-eligible: natural phenomena, laws of nature, and abstract ideas. 3 For example, a new mineral discovered in the earth (natural phenomenon) is not eligible for a patent, even though it may be new, unobvious, and useful. Likewise, Newton would not have been able to patent his law of gravity (law of nature) in the United States. The United States Supreme Court has explained that these exceptions keep the basic tools of scientific and technological work available to everyone and protect them from being monopolized, which could impede innovation rather than promote it. 4 The most challenging exception is the one for abstract ideas, because it is difficult to define when an idea is abstract, or when an idea has crossed the line from being abstract to non-abstract.
The United States Court of Appeals for the Federal Circuit initially indicated that a process producing a useful, concrete, and tangible result would be patent-eligible. The Federal Circuit then decided that the sole test for patent-eligibility would be whether the process is tied to a particular machine or transforms a particular article into a different state or thing. The Supreme Court interjected to explain that the machine-or-transformation test is not the exclusive test for patent-eligibility. After this, the Federal Circuit’s finding of patent-eligibility varied widely as the Federal Circuit tried to fashion a workable standard.
The Supreme Court next indicated that patent-eligible inventions are those that include an “inventive concept” in addition to the judicial exception, to ensure that the exception has not been too-broadly preempted. 5 This “inventive concept” has caused quite a schism in the Federal Circuit as individual judges have taken sides over what “inventive concept” means.
The Supreme Court has agreed to hear one of the cases dealing with computer-implemented business methods and the abstract-idea exception. Several other similar cases have also petitioned the Supreme Court for review. On December 11, 2013, Emerson Thomson Bennett filed such a petition for Sinclair-Allison, Inc., asking the Supreme Court to clarify the standard for analyzing the abstract-idea exception to patent-eligibility. In the Information Age, computer-implemented inventions play an important part in securing America’s competitiveness in global commerce. Such innovations should be encouraged by a clear and workable standard that provides a predictable and consistent answer to the patent-eligibility question.
1 35 U.S.C. § 101.
235 U.S.C. §§ 154(a)(1) and 271(a).
3 Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107, 2116 (2013).
4 Mayo Collaborative Serv. v. Prometheus Lab., 132 S. Ct. 1289, 1293 (2012).
5 Mayo, 132 S. Ct. at 1294.