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The Supremes take on the fog around patent awards

The Supreme Court wasn't necessarily expected to grant the a certiorari for Bilski v. Doll, a case involving a denied patent application for a method of using masses of data, specifically weather data, to predict movement and hedge bets on the commodities market. That they did agree to look at the case indicates that we may, very soon, see the definitive close of an ugly period in patent law as it applies to technology.

The patent system itself, developed for a different era, hasn't been made well-suited to the non-physical nature of code, and so we floundered. For years there was the "useful, concrete, and tangible result" metric derived from the State Street Bank v. Signature Financial Group case, decided in 1998. Before State Street, it was commonly believed that one couldn't patent a simple method of doing business, just as one can't patent an idea. After State Street, chaos, an explosion of software and business-method patents, the rise of the "patent troll," and other things one shouldn't have to have seen outside a Sam Raimi movie.

Enter Bilski, which described a commodities trading method that, though requiring computers to deal with its sheer complexity, was still an abstract idea in its nature. The patent examiner rejected the application, the Board of Patent Appeals and Interferences backed her/him up, and the Federal Circuit upheld the ruling (PDF available here) last October -- tossing the "useful, concrete, and tangible result" concept and stating that a patent can only be granted if the claim is tied to a particular machine or if it transforms something into a different thing or different state. (Patently O wrote a terrific explanation of the ruling when it was released.) The decision blew away State Street -- as Michael Risch at ProfsBlawg so memorably put it, the ruling "effectively wiped out the last 10 years of patentable subject matter jurisprudence -- it's like Bobby stepped out of the shower on Dallas."

And now the Supremes are stepping up to the mic. Lawyers for the plaintiffs say it's not right that an industrial-era system hasn't been revamped to handle our current age, and some observers say that smaller firms with smarts but little development muscle will suffer if they can't protect their work. On the other hand, a number of tech firms -- Microsoft and IBM among them -- like the machine-or-transformation idea, and prefer, if nothing else, a sharper line between what can and cannot be patented. And then there are constituencies who'd like to see software patents all but history; for instance, some segments of the open-source movement.

Your reporter is (dammit, Jim) not a lawyer, but she certainly spends a lot of time untangling what lawyers do. Law.com this morning has a great blog post handicapping what the Court review of Bilski might accomplish. As for us non-JD'ed tech folk, what the Gang of Nine hears, sees and asks when they take this case up next term will without a doubt shape how many of us earn our living and advance the industry.