Patented! - Credit: adulau on Flickr (CC BY-SA)
In a 9-3 decision, the U.S. Court of Appeals for the Federal Circuit has declared that software-only inventions are not patentable. In addition, the Court of Appeals has declared business methods are no longer patentable either. The case is headed to the Supreme Court.
In a ruling with huge implications for the technology sector, the U.S. Court of Appeals for the Federal Circuit said Oct. 30 pure software or business method patents that are neither tied to a specific machine nor change something into a different state are not patentable.
In a 9-3 decision, the court upheld a 1997 U.S. Patent Office refusal to issue a patent to Bernard Bilski for a method of managing the risk of bad weather through commodities trading. The court ruled that processes can be patented only if they are implemented by a machine or transform something into a new or different thing.
The case is now likely headed to the Supreme Court for what would be a landmark decision about the scope of patents in the United States.
The Federal Circuit said software and business methods are still patentable but rejected standards set in a 1998 decision that allowed patents on “methods” of doing business so long as the methods involved use of a computer and produced a “useful, concrete and tangible result.” That decision opened the door for patents that had no connection to technological innovation.
This is big news, but don’t get too excited. It still has to go through the Supreme Court, and this won’t completely get rid of software patents, as one could try to tie down their patent to hardware to make it patentable.