Russ McBee

The US Supreme Court hardly ever gets involved in patent cases. Today was one of those rare times; they issued a unanimous decision in a patent case (KSR v. Teleflex) which I believe will be considered a landmark. It's also one I agree with.

At issue is the question of obviousness. It's a long-established principle that a patent can't be granted on an invention that's merely an obvious modification of what had been done before. Congress finally codified the standard in its present form in 1952 (35 USC 103), and the Supreme Court issued a landmark decision on the subject in 1966 (Graham v. John Deere).

Both the law and that decision have guided lower courts and the US Patent and Trademark Office ever since. The standard of obviousness has always sprung from those two authorities.

Over time however, the Court of Appeals for the Federal Circuit (the court which is largely responsible for patent appeals) has eroded the standard of obviousness to a significant degree. Under the evolved CAFC standard, an invention would only be considered obvious if the pre-existing literature explicitly suggested that particular invention (or suggested it enough to make the invention practically self-evident). Since relatively few inventions could be disqualified under this standard, obviousness had become a much lower and easier hurdle to cross. The result of this erosion has been an exponential proliferation of patents (mainly in software, but in many other fields as well) which would never have passed the sniff test in prior decades.

Without getting into the gory legal details, the decision today will result in more patent applications being rejected for obviousness, and it will result in the invalidation of more patents which have already been granted. In other words, the CAFC's erosion of the standard of patentability in this one area has been reversed.

Justice Kennedy writes of a higher standard than the one employed by the CAFC; instead of granting patents to mere "ordinary innovation," they must now meet a more exacting threshold. He wrote:

We build and create by bringing to the tangible and palpable reality around us new works based on instinct, simple logic, ordinary inferences, extraordinary ideas, and sometimes even genius.

These advances, once part of our shared knowledge, define a new threshold from which innovation starts once more. And as progress beginning from higher levels of achievement is expected in the normal course, the results of ordinary innovation are not the subject of exclusive rights under the patent laws. Were it otherwise patents might stifle, rather than promote, the progress of useful arts.

I strongly suspect that many holders of software patents are feeling quite nervous over that last sentence right about now, as well they should be -- the reputation of US patents has eroded significantly over the last several years, and today's decision will probably represent a turnaround in that reputation.

By making patents harder to get, the Supreme Court has increased the value of those that remain, and they have gone a long way toward restoring some of the damaged credibility of the US Patent and Trademark Office.

UPDATE: Breathtakingly wonky discussions of the legal issues are here, here, here, here, and here. This decision is a watershed moment in the history of US patent law. Due to many factors (one of which is GATT), our patent system has eroded in both authority and value over recent years. This unanimous decision corrects that error in direction. Mark my words: within five years at most, the US patent system will once again be seen as the strongest and most valuable in the world. Anyone capable of winning a patent in the US system will be seen as fully deserving of that grant.