In a 9-3 decision, the U.S. Court of Appeals for the Federal Circuit denied a petition to review its decision, handed down in In re Nuijten (IP Update, Vol. 10, No. 10), the dissenting judges noting that the law surrounding § 101 is in a “conflicted” state. In re Nuijten, Case No. 06-1371 (Fed. Cir., Feb. 11, 2008) (per curiam) (Linn, J.; Newman, J.; Radau, J., dissenting). Soon after, the Federal Circuit, sua sponte, ordered en banc consideration of another pending appeal from the U.S. Patent and Trademark Office on § 101. In re Bilski, Case No. 07-1130 (Fed. Cir., Feb. 15, 2007) (per curiam).

Nuijten

Writing for the three dissenting judges in Nuijten, Judge Linn argued that prior CCPA precedent forecloses the majority’s conclusion, “that something ‘transient’ or ‘fleeting’ cannot constitute a ‘manufacture’ under 35 U.S.C. § 101.” The dissent also argued that the majority holding conflicts with the Supreme Court decision of Diamond v. Chakrabarty, “holding that patentable subject matter includes ‘anything under the sun that is made by man’” save for the law of nature, physical phenomena and abstract ideas.

The dissent also wondered about how the majority holding would affect the relationship between § 101 and § 103: “[i]n this case, we affirm the PTO’s rejection of claims to a signal simpliciter, but the PTO has allowed a claim to a storage medium containing the very same signal, on the grounds that the storage medium is a manufacture that can be rejected, it at all, only under some provision other than § 101. In particular, the PTO considers the patentability of such claims under the ‘printed matter’ doctrine of § 103.”

In the view of the dissent “[t]hese distinctions make no practical sense and are poorly supported by precedent, which, to the contrary, requires a more holistic approach to the question of whether a claim is directed only to an unpatentable abstraction or whether it is directed to a patentable application of such an abstraction to an otherwise statutory invention.”

Bilski

A scant four days later, the en banc Federal Circuit sua sponte ordered en banc review of the pending appeal in Bilski, asking the parties to brief the following five questions:

1. Whether … [Bilski’s patent application] claims patent-eligible subject matter under 35. U.S.C. § 101?

2. What standard should govern in determining whether a process is patent-eligible subject matter under § 101?

3. Whether the claimed subject matter is not patent-eligible because it constitutes an abstract idea or mental process; when does a claim that contains both mental and physical steps create patent-eligible subject matter?

4. Whether a method or process must result in a physical transformation of an article or be tied to a machine to be patent-eligible subject matter under § 101?

5. Whether it is appropriate to reconsider State Street Bank & Trust Co. v. Signature Financial Group, Inc. and AT&T Corp. v. Excel Communications, Inc., in this case and, if so, whether those cases should be overruled in any respect?

The Bilski application claim in issue is directed to a method of managing the risk of bad weather through commodities trading; it does not claim or require a computer or storage media.

The Federal Circuit has requested only one supplemental brief from each party to be filed simultaneously on March 6, 2008. Amicus briefs may be filed without leave of court and are due 30 days later. The order sets the case for re-hearing on May 8 at 2:00 p.m. It should be standing room only.

It would seem likely that many of the amicus briefs filed in the Supreme Court in the case of LabCorp v. Metabolite (IP Update, Vol. 9, No. 6) (dismissed, after oral argument, as cert having been improvidently granted) will be recycled here.

Practice Note: Although business method patents have been ubiquitous for the 10 years since the Federal Circuit handed down its State Street decision, in the past several years there have been rumblings about the holding from the Supreme Court on at least three separate occasions: eBay, Inc. v. MercExchange, (IP Update, Vol. 9, No. 5), LabCorp v. Metabolite, (dissent, IP Update, Vol. 9, No. 6) and Microsoft v. AT&T (IP Update, Vol. 10, No. 5).