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Federal Circuit To Hear Case That Could Stem Software Patents Tomorrow

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Federal Circuit To Hear Case That Could Stem Software Patents Tomorrow

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The US Court of Appeals for the Federal Circuit en banc will hear oral arguments Thursday in the Bilski case, which, if their honors get to feeling radical and rule broadly, could outlaw not only business methods patents in the United States but – by extension – void all existing software patents and patent applications.

It could take the court maybe nine months and into a new administration to decide.

And it could mean overturning the same court’s landmark 1998 State Street Bank decision finding that business methods could be patented.

If the Patent and Trademark Office, which is smarting under the criticism of rubberstamping bad patents and laboring under a backlog of 750,000 patent applications, gets its way business methods that rely on humans for execution rather than a machine or that don’t physically transform something into a different state or something else would be eliminated as a patentable class.

Tying the standard to a machine could take out software, lawyers opposing the PTO say, which is why the case has attracted about 30 amicus curiae briefs. The court specifically asked about the validity of the State Street ruling.

A decision in favor of the PTO would fly in the face of a 1981 Supreme Court decision known as Diehr that held that processes are patentable provided they have a practical application that produces a useful result and the high court has never held – or even suggested – that a method involved human instrumentalities is not patentable.

As a matter of fact the Supreme Court ruled a process can be patented, irrespective of the particular form of instrumentality used.

Congress has also legislated in favor of business methods.

Critics of the PTO’s position like Accenture, which has created a NewEconomyPatents.org advocacy site in favor of an open and technology-neutral patent system, say the proper decision would be a reiteration of Diehr.

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