Bilski v. Kappos is the case being argued in the Supreme Ct. which hopes to resolve whether the Federal Circuit erred by holding that a “process” must be tied to a particular machine or apparatus, or transform a particular article into a different state or thing (”machine-or-transformation” test), to be eligible for patenting under 35 U.S.C. § 101. The Court’s precedent declining to limit the broad statutory grant of patent eligibility for “any” new and useful process beyond excluding patents for “laws of nature, physical phenomena, and abstract ideas.” Is at the heart of the debate. Similar to the idea/expression dichotomy limit on copyrights, where expressions are protected and ideas are available for public exploitation, Patents too have limitations grounded in the 1st Amendment. However, patents are slightly more complicated because methods of doing business and processes can be protected by patents. The question is whether a special test for processes conflicts with the congressional intent of supporting the technological arts.
The issues regarding the precedent of the machine or transformation test, and it’s constitutionality, lies in what the court will interpret as what it means to be tied to a particular machine. If one attaches ‘in a computer’ to an application for a process patent, is that enough to pass the machine-or-transformation test? The patent office has been saying ‘no,’ that innovation needs to demonstrate a transformation of matter or tie to a machine function.
Bilkski’s claimed invention was a method for managing the consumption risk costs of a commodity sold by a commodity provider. Bilski developed equations which initiate a series of transactions, identifies market participants, and evaluates the risk of a commodity provider. When their “invention” reached the patent office, the first examiner found 5 of their 9 claimed invention applications to be patentable. Bilski appealed, however upon appealing received a rejection on all claims, because of the machine-or-transformation test, and so began their struggle over patentability a digital age.
According to Bilski, an invention should rely on a “useful, concrete, and tangible result” in order to receive a patent, as stated in the Federal Circuits precedent in At&t v. Excel Inc. This would mean that when a claim containing a mathematical formula implements or applies that formula in a structure of processes which, when considered as a whole, is performing a function, patent laws protect them. The respondent Kappos, along with the majority of the amicus breifs is under the impression that The Patent Act should be interpreted so that the machine-transformation test stands. In their defense is a trilogy of supreme Ct. Cases that have all maintained the machine or transformation test. Meaning that software can contribute to claims for patents only to the extent the software is combined with a special purpose machine, or is used in a process that transforms matter. The question on which will yield more innovation is up for debate, and 65 amicus briefs, the most of all cases in the Supreme Ct. this session, attempt to answer this question.
It is true that all software is at a certain level represented as algorithms for computers. The fact that these algorithms are actually readable by people, complicates the issue of patentability. Natural laws and phenomena cannot qualify for patent protection, and abstract ideas are not eligible because they don’t serve a purpose.” However, what about useful abstract ideas, or the fact that writing and developing these algorithms cost lost of time and money? Currently the US patent office mandates that abstract ideas must be applied to a practical use before they can be patented, and also undergo the machine transformation test, regardless of the language of the section 101 in the US Patent Act of 1952.
Bilski obviously hopes to get rid of this special test for processes, arguing the precedent conflicts with the plain language of section 101. Their ideas are that commercial business methods should be patentable, if they pass the useful concrete and tangible result test. Stating that “adding the additional test is unconstitutional and restricting.” They hope that the court will interpret section 101 broadly enough to protect methods of doing business. In their eyes, concerns over potentially vague or trivial patents for business methods should be addressed by the other requirements for patentability, such as novelty, non-obviousness, and definite claiming. Their effective summary is that the machine or transformation test has no basis in the patent statue and conflicts with the courts precedent.
The respondents Kappos believes that section 101 is designed to protect industrial and technological processes, and that it excludes methods directed to organize human activity. The crucial point is that the machine transformation test, is a way the court can implement a filter by which to test individual cases on their patent eligibility as opposed to accepting a broad and encompassing approach. Currently the court views software code as an idea without physical embodiment, merely information as a detailed set of instructions. One danger is that by implementing a standard for processes that is too strict might hurt the economy of innovation.
Kappos is under he impression that section 101 is already interpreted broadly enough, and imposes meaningful limits on the scope of patent protection, and that the alternative tests proposed by Bilski do not appropriately limit patent protection. Since the process of Bilski’s invention only pertain to human activity it should not be protected by patents, and would need to be tied to a particular machine or apparatus in order to qualify. Something that would turn the abstract idea of computer code into a process with a meaningful purpose. They believe that this test is actually beneficial to innovation, because it would allow for a more free exchange of information and ideas.

