Bilski v. Kappos

Bilski v. Kappos, 561 U.S. 593 (2010), was a case decided by the Supreme Court of the United States holding that the machine-or-transformation test is not the sole test for determining the patent eligibility of a process, but rather "a useful and important clue, an investigative tool, for determining whether some claimed inventions are processes under § 101." In so doing, the Supreme Court affirmed the rejection of an application for a patent on a method of hedging losses in one segment of the energy industry by making investments in other segments of that industry, on the basis that the abstract investment strategy set forth in the application was not patentable subject matter.

Majority opinion

The Court affirmed the judgment of the Federal Circuit in In re Bilski, the case below. However, it rejected the machine-or-transformation test as a sole test of patentability based on an interpretation of the language of § 101. The Court rejected the Federal Circuit's statutory interpretation regarding the word "process", finding the definition in § 100(b) to be sufficient without turning to the canon of noscitur a sociis. Section 100(b) defines process as a "process, art or method, and includes a new use of a known process, machine, manufacture, composition of matter, or material".

The Court looked to Gottschalk v. Benson and Parker v. Flook, and noted that both had explicitly refused to rely on the machine-or-transformation test as the sole test for patent eligibility.

The Court also rejected a categorical exclusion of business method patents from eligibility, reasoning that the definition of "process" in § 100(b) includes the word "method", which appears to comprehend some forms of business method patents.