Editor: Clearly this case has drawn significant interest, with nearly 70 amicus briefs having been filed. How big are the stakes here?
Bauer: The stakes are very high. Depending on what the court does, this could be a transforming event. Over the last 30 to 40 years, the patent system has evolved essentially to allow nearly anything to be patented. This case has brought the issue of business method patents into question, specifically a process that could make energy costs more predictable. Based on the justices' comments during oral arguments, the Supreme Court appears poised to scale back what should be considered patentable - the question is how far they'll go.
Editor: Having been in the courtroom, do you have a read?
Bauer: It's pretty clear that Bilski is not going to get his patent, but, beyond that, it's anyone's guess. The justices are looking to the government to help them come up with parameters that roll back the standard of patentability somewhat, but it's hard to say how far they'll go. They could be looking beyond just business methods, considering things such as methods of covering medical treatments - for example, whether it should remain possible to patent the administration of a drug with a specific dosage. Or they could be looking at software and seeking to put some guidelines around the question of whether - or when - writing a software program is more than a process and can be considered a technology. So, again, there are major implications and a lot of nuances to be considered.
Editor: Who are the possible winners and losers here?
Bauer: Depending on the outcome, the big winners could be technology companies that face a lot of lawsuits challenging what they believe to be obvious business methods. The losers could be non-operating companies - sometimes called "patent trolls" - that make patenting these types of things a significant part of their businesses.
Editor: What impact could a "no-Bilski" decision have on future litigation?
Bauer: Ninety percent of our work at Proskauer is defense oriented, and this will be a new defense - maybe the best defense.
Editor: Is there anything businesses can do now with respect to protecting their patent portfolios?
Bauer: If you are in the business of patenting business methods, there is not much you can do until the court provides more guidance. If the court says business method patents are invalid, there will be no grandfathering, as would happen if the issue were in the hands of Congress. Everything that happened in the past would be considered unconstitutional. We're probably looking at around 10 percent of the patents potentially being at risk. That's a lot of patents.
Editor: Are there cases hanging in the balance pending the outcome?
Bauer: Absolutely. In fact, we're involved in one of the biggest pending cases. After the Bilski decision, we may have one of the first decisions that comes out invalidating a patent. We're teed up and ready to go.