Tuesday, August 15, 2006

IS AN ATTACK ON STATE STREET IN THE WORKS? Since the Supreme Court punted on the question of patentable subject matter in LabCorp v. Metabolite, and in light of the back-handed comments made by some of the Justices to the patentee in Ebay v. MercExchange (Chief Justice Roberts: "I may not be a software developer, but as I read the invention, it's displaying pictures of your wares on a computer network and, you know, picking which ones you want and buying them. I -- I might have been able to do that"), patent pundits have been abuzz on whether or not the Supreme Court is preparing to change 35 U.S.C. 101 after a 25-year hiatus (LabCorp was seen as the first chance to do so). The last time the Supreme Court decided a case on patentable subject matter was Diamond v. Diehr, back in March of '81.

Currently, at least three Justices (Breyer, Stevens and Souter) have openly expressed reservations about the current state of 35 U.S.C. 101 in the dissent from the dismissal order in LabCorp:

At most, respondents have simply described the natural law at issue in the abstract patent language of a "process." But they cannot avoid the fact that the process is no more than an instruction to read some numbers in light of medical knowledge. Cf. id. at 192 (warning against "allow[ing] a competent draftsman to evade the recognized limitations on the type of subject matter eligible for patent protection"). One might, of course, reduce the "process" to a series of steps, e.g., Step 1: gather data; Step 2: read a number; Step 3: compare the number with the norm; Step 4: act accordingly. But one can reduce any process to a series of steps. The question is what those steps embody. And here, aside from the unpatented test, they embody only the correlation between homocysteine and vitamin deficiency that the researchers uncovered. In my view, that correlation is an unpatentable "natural phenomenon," and I can find nothing in claim 13 that adds anything more of significance.
In the eBay concurrence, Justice Kennedy (who was joined by Breyer, Stevens and Souter) expressed skepticism about business-method patents in general:
In addition injunctive relief may have different consequences for the burgeoning number of patents over business methods, which were not of much economic and legal significance in earlier times. The potential vagueness and suspect validity of some of these patents may affect the calculus under the four-factor test.
Given the context of these and other remarks made by the Justices, it appears that the Court has found it appropriate to introduce a notion of "balance" in the law's approach to patentable subject matter (i.e., when does patent protection go too far?). Also, as professor Joseph Miller stated in his excellent The Fire of Genius blog, the decisions over recent terms suggest that a generalist (rather than specialist) approach to patent law doctrine is currently favored by the Court ("[o]ccasional decisions by courts with broader jurisdiction will provide an antidote to the risk that the specialized court may develop an institutional bias." Holmes Group, Inc. v. Vorando Air Circulation Systems).

Other commentators have picked up a number of other aspects of the LabCorp decision that hint that the Supreme Court may be tilting towards a more restrictive approach to patents: the reliance on (technologically) "old" case law (Gottschalk, Funk Bros, Parker v. Flook), and the selective citation of arguably "anti-patent" academic articles.

It is likely that considerable time will pass before the Supreme Court gets to revisit this issue again. But when they finally get the opportunity, chances are that some type of change will be in the works.

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