Business Method Patent Tips Offered In Wake of Bilski, Comiskey, MuniAuction

by Brian Fletcher on June 19, 2009

Patent practitioners discussed the viability of business method/software patent protection during a recent BNA audioconference looking at recent decisions by the U.S. Court of Appeals for the Federal Circuit.  But, they also provided clues on best strategies for litigating patents that have already been granted.

The June 3rd conference, sponsored by BNA’s Legal & Business EDge division, featured attorneys from IP law firm Finnegan.  Robert E. Yoches, Jeffrey A. Berkowitz, Kara F. Stoll, and Erika Harmon Arner, from the firm’s offices in Washington, D.C., and Reston, Va., first described the impact of three Federal Circuit decisions on business method and software patenting generally:

In re Bilski set rules for patent-eligible methods under the “machine-or-transformation” test.  545 F.3d 943, 88 USPQ2d 1385 (Fed. Cir.  2008) (en banc).

In re Comiskey initially held that the “routine addition of modern electronics to an otherwise unpatentable invention typically creates a prima facie case of obviousness,” but, post-Bilski, a revised opinion deleted that limitation.  554 F.3d 967, 89 USPQ2d 1655 (Fed. Cir.  2009).

MuniAuction Inc. v. Thomson Corp. addressed software in the Internet context, and said that it would have been obvious to modify prior art, non-Internet software to incorporate conventional Web browser functionality for the online auction business method patent at issue.  532 F3d 1318, 87 USPQ2d 1350 (Fed. Cir. 2008).

The conference then turned to strategies for moving forward with already-issued software patents, with Yoches offering the following strategies for patent owners:

Seek a reissuance of the patent.  If the patent was issued more than two years ago, you may still be able to add narrowing claims.  If you are one of the “stark minority of people” who was granted a software patent in the last two years, he said, broader claims might even be possible.  He pointed out the risk, in that the “hostility” of the USPTO might result in losing the patent entirely, but said that “you may face that risk in court anyway.”

Preempt MuniAuction issues by reexamination.  Yoches recommended “amend claims and emphasize other differences from prior art.”  He noted that reexamination can take years and warned listeners to “guard against inequitable conduct changes based on knowledge gained after the original patent issued.”

Yoches also had advice for accused infringers:

At least file a summary judgment motion on 35 U.S.C. 101 patentability.  Section 103 obviousness may be a legal issue as well “if there is no dispute about the differences between the invention and the prior art.”

A request for inter partes reexamination may delay a trial, and the PTO’s hostility may work in your favor, he said, but the risk is that the patent’s validity will be enhanced if claims do issue, and reexamination also gives the patent owner an opportunity to draft narrow claims that cover the precise accused device.

Post-judgment, a favorable reexamination result and a Rule 60 motion could be effective, he said, citing a case where the Federal Circuit deferred to a reexamination of a patent at issue and vacated a jury award for infringement.  Translogic Technology Inc. v. Hitachi Ltd., 250 Fed. Appx. 988 (Fed. Cir. 2007).

Yoches also acknowledged, however, that current advice could become obsolete when the U.S. Supreme Court issues a ruling on business method/software patentability issues in its pending review of Bilski.  The Finnegan firm authored the certiorari petition on behalf of the unsuccessful business method patent applicants in that case.

To an audience member’s question for advice if you are in the midst of litigation now, he said, “I’d suggest a stay.  The Supreme Court is going to be addressing this directly within a year.”  Especially if your case is before the Federal Circuit now, he said, “you have every reason to ask for a stay.”

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