Bilski: Pandora’s Box or Panacea?- II

In the last post, we had undertaken analysis of Justice Kennedy’s opinion in the Bilski decision. In this post and the next, we discuss Justice Stevens’ and Justice Breyer’s opinions.

Justice Stevens concurs with the conclusion of Justice Kennedy, but differs with the logic applied to reach it.

He disagrees with Kennedy .J, in that he is of the view that merely because a series of steps are specific and not abstract, the steps do not constitute a process under section 101. He extends this to categorically state that business methods are ineligible subject-matter for patents. To prove this, Justice Stevens uses both statutory and historical approaches.

He uses the very same section 273 to argue against eligibility of business method applications. He says that section 273 was included in the Act at a time when the Federal Circuit was beginning to consider allowing business method patents. To ensure that the long history behind non-grant of patents to business methods was not overturned by this sudden change of course by the Federal Circuit, section 273 was included i.e. to reinforce the commonly held view among practitioners and applicants that business methods were hitherto unpatentable and remained unpatentable; consequently, under section 273 their ineligibility is available as a defense against an allegation of infringement by a patentee whose patent claims a business method.

Therefore, he says section 273 must be used to argue against business method patents instead of for it.

Although, I do not deny that this is persuasive and is grounded in legislative history, history is usually an external aid of interpretation, which may be applied only if the language of a provision is unclear. If section 273(b)(1) clarifies that the defense against infringement is available on grounds that the method in a patent was in use atleast one year prior to the filing of the patent, it is difficult to interpret section 273 to support exclusion of eligibility of business methods.

To put it in simple words, section 273(b)(1) provides a defense against allegation of infringement on grounds that the method claimed in the suit patent was reduced to practice a year prior to filing of the patent. Further, the title of section 273 reads “Defense to infringement based on earlier inventor”, which clearly suggests that the defense is not based on patent ineligibility of business methods, but on prior use of the business method. Therefore, on this particular point, I would go with Justice Kennedy i.e. the language of the Act does not seem to bar business method applications and section 273 implicitly supports this.

However Justice Stevens marshals a few other arguments, which are hard to ignore. He puts forth an argument based on literal interpretation of section 101. According to him, when section 101 requires the subject-matter of a patent application to be new and useful, it means that applications which are useful for one’s business are eligible for a patent grant, but applications which deal with the very method of doing or conducting his business are not eligible.

He proceeds to assail the logical structure of Justice Kennedy’s opinion; he says that imputing an ordinary, contemporary and common meaning to a word such as “process” used in the statute is no doubt a fine principle of statutory interpretation. However, this principle has to give way to a specific connotation that “process” has come to acquire by virtue of its use in an extremely technical and specialized setting and which is the product of more than a century’s jurisprudence.

Therefore, the very premise of Justice Kennedy, according to him, is flawed because if the common meaning of process were to be the meaning under the Patents Act, then even a series of steps devised to train a canine would be patentable under the Act because it would be new, useful and non-abstract.

Further, he points to the tautologous definition of process in section 100 (process means a process….) and observes that just as it would be inaccurate to say that the meaning of process can be deciphered from the neighbouring terms such as machine, manufacture or composition, the circular definition for a process given in the Act too cannot be interpreted to include any process or a business method.

He states that the categories in section 101 are disjunctive (“or”) and the definition in section 100 itself goes in circles. Therefore, according to him, the interpretation of “process” by Justice Kennedy which is based on heavy reliance placed on the express definition in section 100 is flawed.

To understand the term process, Justice Stevens refers to Justice Dyk’s review (in the Federal Circuit Bilski decision) of the evolution of American and English precedents on patents. In the Federal Circuit Decision , Justice Dyk concludes that at no point do any of the precedents suggest eligibility of business methods; this, despite the fact that innovation in ways of doing or conducting business is not a new phenomenon.

In fact, almost a century ago, the changes made to business models were revolutionary. Justice Stevens uses this historical fact to establish that despite there being several innovations by entrepreneurs in the manner in which they conducted their business, barring one-off instances which were never tested for validity because they never reached the Court, business methods were not even contemplated or deliberated as being within the scope of patentable subject-matter.

He delves deeper into the American Constitution, history of patent law in the US and literature on innovation, to point out that “useful arts” as used in the American Constitution have always been understood as referring to “technological arts”, which stand distinguished from liberal arts, banking, commerce etc. Therefore, according to him, taking a view which supports grant of patents to business methods is even unconstitutional.

He also draws attention to the fact that in the entire opinion, Justice Kennedy does not provide a definition for an unpatentable abstract idea. He states this thus:

“The Court, in sum, never provides a satisfying account of what constitutes an unpatentable abstract idea. Indeed, the Court does not even explain if it is using the machine-or-transformation criteria. The Court essentially asserts its conclusion that petitioners’ application claims an abstract idea. This mode of analysis (or lack thereof) may have led to the correct outcome in this case, but it also means that the Court’s musings on this issue stand for very little...”

He advocates that instead of approving eligibility of business method applications for patent grant and rejecting the Bilski application as invalid for claiming an abstract idea, the Court ought to have held that the Bilski application is unpatentable for it claims a business method, regardless of it being abstract, although it is abstract. This would have put an end to applications claiming business methods.

On the MT test, he agrees that it should not be the sole test for determining patentable subject-matter, but adds that there are very few technologies where the test has proven to be ineffective. On this specific point, we have received comments from our readers that the MT test is giving applicants for patents in biotechnology a tough time. So this observation by Justice Stevens may have the undesirable effect of the USPTO force-fitting biotech applications within the MT test instead of judging the application on its own merits.