United StatesBusiness methods patents survive… for now

This is an Insight article, written by a selected partner as part of IAM's co-published content. Read more on Insight

On June 28 2010 the Supreme Court issued its longawaited Bilski v Kappos opinion on the patentability of business methods. In a broad, rambling opinion, the court seemed able to agree only that the Bilski claims at issue for hedging by commodities buyers and sellers against the risk of price changes in the energy market were unpatentable subject matter. It did so narrowly by finding that the claims were attempts to patent abstract ideas and not by using the ‘machine or transformation’ test espoused by the Federal Circuit in the same case in 2009. Notably, the court seemed in unanimous agreement that the machine or transformation test is not the sole test for patent eligibility under Section 101; in fact, the majority expressly stated that a process need not be tied to a machine or transformation. Along the way, the court permitted business methods in general to survive – but it was a close call.


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