Dolcera IP

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• Dolcera IP Knowledge Services

In re Bilski A Threat to all Method Claims?
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Agenda
In re Bilski - Background
Method Claims - Frequency

101 Rejection - Frequency
Research Sample Set
Research Methodology
Findings and Results
Discussions
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What in Blazes Is In re Bilski?

• Bernard Bilski Rand Warsaw filed a US patent
  application April 10, 1997, 08/833,892, for
  hedging of risks in energy commodities trading.
• PTO examiner rejected all 11 initial Bilski
  claims because "the invention is not implemented
  on a specific apparatus and merely manipulates
  an abstract idea and solves a purely
  mathematical problem without any limitation to a
  practical application, therefore, the invention
  is not directed to the technological arts."

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Bilski Appeals

• Bilski appealed examiner's rejection to Board of
  Patent Appeals Interferences BPAI. BPAI
  sustained the rejection of Bilski's claims, but
  on different grounds. "The Board concluded that
  Applicants' claims did not involve any
  patent-eligible transformation, holding that
  transformation of "non-physical financial risks
  and legal liabilities of the commodity provider,
  the consumer, and the market participants" is not
  patent-eligible subject matter."
• http//www.uspto.gov/web/offices/dcom/bpai/its/fd0
  22257.pdf

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Bilski Appeals to BPAI

• BPAI the Board held that Applicants' process as
  claimed did not produce a "useful, concrete and
  tangible result," and for this reason as well was
  not drawn to patent-eligible subject matter.
  That is, BPAI sustained a 35USC101 rejection of
  Bilski, claims drawn to non-patent eligible
  subject matter.

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Bilski Appeals to CAFC

• Bilski, not one to quit easily, appealed the BPAI
  ruling to the CAFC. The initial CAFC Panel,
  sua sponte, invoked an en banc hearing of the
  entire CAFC to consider the Bilski appeal.
  Their ruling,
• 545 F.3d 943, 88 U.S.P.Q.2d 1385 (Fed. Cir.
  2008), sustained the BPAI rejection of Bilski's
  claims, but also overturned a prior important
  business methods patents decision of the CAFC,
  State Street Bank Trust Co. v. Signature
  Financial Group, Inc., 149 F.3d 1368 (Fed. Cir.
  1998). In State Street, the CAFC had ruled that
  business methods claim is eligible for
  protection by a patent in the United States if it
  involved some practical application and it
  produces a useful, concrete and tangible result.

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CAFC Rules In re Bilski

• Useful, concrete tangible results no longer the
  test of 101 for method claims!
• Must be tied to a machine or produce a
  transformation machine or transformation sole
  test of method claims 101 eligibility!
• Process claims likely swept into question!

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Bilski Appeals to Supreme Court

• Bilski has appealed to US Supreme Court. Amicus
  briefs in support of USSC granting certiorari
  include Medistem's, where they argue
• The Federal Circuits limiting the scope of
  patentable subject matter for process
  inventions in Bilski casts a cloud of uncertainty
  as to whether Medistem and other biotech
  companies can continue to protect with patents
  their inventions relating to methods of
  diagnosing causes of diseases and methods of
  selecting beneficial treatment protocols. "

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Amicus Brief Process Worries

• That is not simply Medistem's fear, but a not
  unlikely uncome of the Bilski decision according
  to Judge Rader's dissent against CAFC Bilski
  decision
• Judge Rader cogently noted that excluding patent
  protection for methods of using discovered
  biological or physiologi-cal correlations will
  undermine and discourage future research for
  diagnostic tools. Bilski, 545 F.3d at 1014.
  Medistem p3

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Medistems Concerns

• Although the patent at issue in Bilski claimed a
  business method, the Federal Circuit did not
  confine its adoption of the machine-or-transforma
  tion test to business methods. Instead, the
  court more broadly considered what test or set
  of criteria governs the determination by the
  Patent and Trademark Office (PTO) or courts as
  to whether a claim to a process is patentable
  under 101 or, conversely, is drawn to
  unpatentable subject matter because it claims
  only a fundamental principle. 545 F.3d at 952
  (emphasis added). It answered that question by
  holding that the machine-or-transformation test
  is the only applicable test and must be applied .
  . . when evaluating the patent-eligibility of
  process claims. Medistem p5

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If Bilski Reads on All Process Claims!?

• If the machine or transformation test is the sole
  test of 101 eligibility of process or method
  claims, pharma, medtech, diagnostics all at
  likely risk!

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How Common Are Method Claims?US-A,B 2001-2009
Medtech Methods Medtech Methods and Apparatus Medtech Method of Treatment
140,074 92,650 (66) 72,459 (52 18,735 (13)

Pharma Pharma Methods Method Apparatus Method of Treating
187,011 158,725 (85) 17,924 (10) 98,776 (53)

Diagnostics Methods Method of Diagnosis
38,688 27,433 (71) 7,344 (19)
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How Common Are 101 Rejections of Method Claims?

• Series of samples prepared in medtech, pharma,
  diagnostics software patent applications
• Medtech 341 US apps sampled
• Pharma 325 US apps sampled
• Diagnostics 364 US apps sampled
• Software US apps sampled

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Sampling of Methods Claims

• US Published Apps retrieved in Public PAIR
• File History screened for Office Action(s)
• If FOA, was 101 rejection found?
• If 101, was Bilski cited as basis?

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Medtech Example

• US20070034215A1 filed 6/27/06
• FOA issued 1/13/2009
• 101 rejection of claims 1-22 for lack of tangible
  product or practical application
• 21 of 40 had FOA, 19 no FOA
• Filing dates of no FOA as early 09/30/2005

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In Re Bilski Research Methodology

• Medical Technology Patent Applications

Mine US PAIR for Patent Applications (Published
between 2007- 2008) 700
Only Examined applications With any Rejection
54 / 110
Note 110 is part of 700
Only Patent Applications Examined post Oct
2008 37 / 54
With 35 U.S.C. 101 Rejections 2
None - In re Bilski Citations
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Pharma Sample

• 18 / 24 had FOA, 6 no FOA
• Filing dates of no FOA as early 10/22/2003
• No citations of In re Bilski

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Diagnostics Sample

• 64 US Pregrants w methods of diagnosis claims,
  only 1 with 101 rejection
• US20060094954 filed 01/21/05
• FOA mailed 02/17/09 nearly 49 mo.!
• Larger sample of 300 diagnostics methods
  pregrants, 12 101 rejections
• Only 74 of 300 had FOA

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In Re Bilski Research Methodology

• Diagnostics Patent Applications

Mine US PAIR for Patent Applications (Published
between 2005- 2007) 200
Only Examined applications With any
Rejection 128 / 200
Only Patent Applications Examined post Oct
2008 66 / 128
With 35 U.S.C. 101 Rejections 22
In Re Bilski Citations 9 / 22
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US20060094954 101 Rejection
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Software Patent Samples

• US 2008-0201671 A1 filed 02-16-2007
• FOA issued 02-17-2009
• 101 rejection of claims 1-17 for the subject
  matter not being attached to a machine or
  undergoing a transformation
• 1000 patent applications have been looked for the
  rejections which are randomly chosen based on
  range of publication date 4/1/2008 to 3/30/2009
• On the same sample set, Applications with
  examination date 6 months prior to Oct 2008, 40
  had FOA
• On the same sample set, Applications with
  examination date 6 months post Oct 2008, 80 had
  FOA, 880 had no FOA.
• Filing dates of no FOA as early 5/1/2003

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In Re Bilski Research Methodology

• Software Patent Applications

Mine US PAIR for Patent Applications examined
post Oct 2008) Approx 1000
Patent Applications with 35 U.S.C. 101
Rejections only 100
In Re Bilski Citations 23 / 100
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US20050075274 Rejection
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US20080243564 101 Rejection
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US20080204773 Rejection
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US20050076103 Rejection
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