561 U.S. 593 (2010) (Supreme Court of the United States)
Bilski v. Kappos is a landmark Supreme Court case that reshaped the contours of patent-eligible subject matter under 35 U.S.C.
Are Bilski's claims to a method of hedging risk patent-eligible under 35 U.S.C. § 101, and is the machine-or-transformation test the exclusive test for determining the patent eligibility of a process?
Under 35 U.S.C. § 101, patentable subject matter includes any new and useful process, machine, manufacture, or composition of matter, and improvements thereof. Judicially created exceptions exclude laws of nature, natural phenomena, and abstract ideas from patent eligibility. The machine-or-transformation test may be a useful and important clue or investigative tool for determining process eligibility, but it is not the exclusive or dispositive test. Business methods are not categorically excluded from § 101; however, claims directed to abstract ideas are not patentable, and field-of-use limitations or token post-solution activity do not render an abstract idea patent-eligible.
The Supreme Court affirmed the denial of Bilski's patent. The machine-or-transformation test is not the sole test for process patent eligibility under § 101, but Bilski's hedging claims are unpatentable because they are directed to an abstract idea.
Bilski recalibrated the § 101 analysis by preventing the machine-or-transformation test from ossifying into a rigid rule, yet preserved the core judicial exception that abstract ideas are not patentable. It refused to categorically ban business method patents, signaling that eligibility turns on whether claims do more than monopolize fundamental principles. The decision set the stage for Mayo and Alice, which transformed Bilski's guidance into the modern two-step eligibility framework. For law students, Bilski is essential to understand the evolution of patent-eligibility doctrine, the role of preemption and judicial exceptions, and the interplay between statutory text and common-law limits.