By Audrey A. Millemann

The Federal Circuit Court of Appeals has redefined the test for the patentability of business methods and computer software. In In re Bilski, 545 F. 3d 943 (Fed. Cir. 2008), an en banc decision, the court discarded the current test, which it established in its 1998 decision in State Street Bank & Trust Co. v. Signature Financial Group, Inc., 149 F.3d 1368 (Fed. Cir. 1998) for a test set forth in a Supreme Court case decided in 1972, Gottschalk v. Benson, 409 U.S. 63 (1972).


Bilski sought to patent a method for hedging risks in commodities trading. Claim 1 required three steps, the essence of which were: (1) initiating a series of transactions between a commodity provider and consumers; (2) identifying market participants for the commodity; and (3) initiating a series of transactions the between the commodity provider and the market participants. The U.S.P.T.O. rejected Bilski’s claims on the grounds that they were not a patentable subject matter under 35 U.S.C. § 101. Continue Reading New Test for Business Methods Patents