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Are business methods patentable?

21 Aug 2008

The US federal courts have embraced various interpretations of patent law as it applies to business methods over the years. With In re Bilski, heard 8 May, the court again took up the issue, and its ruling will have a major impact on patent law, writes Greg Reilly of Morrison & Foerster.

In recent years, patents have been sought in a wide variety of fields once thought beyond the reaches of the patent laws, including tax strategies, executive compensation schemes, and dispute resolution.

On 8 May 2008, the Federal Circuit heard en banc oral argument on In re Bilski, a case that directly raises the patent eligibility of so-called business method patents.

Business Method Patents 101

35 U.S.C. § 101 provides that "any new and useful process, machine, manufacture, or composition of matter" may be patentable subject matter. While the Supreme Court has emphasized that Section 101 is very broad, it has also held that abstract ideas, laws of nature, and natural phenomena are excluded. Moreover, only "a 'process' within the meaning of the Patent Act" - not every "'process' in the ordinary sense of the word" - qualifies for patent protection under Section 101.

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