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US Supreme Court finally issues business method patent decision

The United States Supreme Court has issued its ruling in In Re Bilski on the patentability of business method patents. The Court affirmed the lower court's ruling and held that the challenged claims of the Bilski patent application were not directed to patentable subject matter because they claimed an abstract idea. The Bilski patent application was directed to the concept of hedging risk and the application of that concept to energy markets.

The Court considered the claims of the Bilski application in the context of the 'machine or transformation' test used by the en banc U.S. Court of Appeals for the Federal Circuit, the patentability of 'business methods' as a category, and patenability of an abstract idea, and ruled unanimously that the Bilski application was not patentable subject matter as it was directed to an abstract idea. The Court criticized the lower court's "exclusive" use of the machine-or-transformation test, but noted it was a useful tool for determining patent eligibility. Through concurring opinions, a minority would have categorically excluded business methods from patentable subject matter.

The opinion of the Court (PDF) is available from the Supreme Court website.