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High court considers whether business methods can be patented

Rand A. Warsaw and business partner Bernard L. Bilski, not pictured, started their own firm to commercialize the method they invented for hedging risk. Both had been gas company executives.
Rand A. Warsaw and business partner Bernard L. Bilski, not pictured, started their own firm to commercialize the method they invented for hedging risk. Both had been gas company executives. (Keith Srakocic/associated Press)
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"Some of the justices seemed to be struggling for what the right test should be," said Washington lawyer Deanne E. Maynard, who as a former assistant to the solicitor general helped draft portions of the government's brief against granting review. "They seemed concerned about the effect their decision would have on patents not yet before the court."

The case has drawn intense interest in fields such as software, medical diagnostics and finance, where advances often come in the form of strategies that might not be eligible for patents because they do not involve machinery or the "transformation" of anything physical.

The inventors' attorney, Jakes, argued that the perspective of the Industrial Era, in which inventions often involved a machine or other physical process, should not limit the patent protections in the future.

But the attorney for the U.S. Patent and Trademark Office argued that the distinction between inventions that involve the physical matter and those that involve business techniques have worked long before the Information Age.

He drew a distinction between the innovations of Dale Carnegie, author of "How to Win Friends and Influence People," and Alexander Graham Bell, the inventor of the telephone.

"I think at a certain level of generality you could describe both Dale Carnegie and Alexander Graham Bell as people who devised methods of communicating more effectively," Deputy Solicitor General Malcolm L. Stewart argued. "The reason that Bell's method was patentable was that it operated in the realm of the physical. . . . Innovations as to new techniques of public speaking, new techniques of negotiations, techniques that go to the substance of what is said may be innovative. They may be valuable. They are not patent eligible because they don't deal in the realm of the physical."


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