The Federal Court of Appeal in charge of interpreting Patent Law has been an absolute disgrace. I would have thought that it should be obvious that only tangible technology could be eligible for a patent under the law. But the court has at times implied that even modes of thought and communication can somehow be patented if it leads to concrete results in the physical world. Maybe they are slowly staring to get the message of just how wrong they have been all along.

The U.S. Court of Appeals for the Federal Circuit redefined the margins of patent eligibility in State Street Bank & Trust Co. v. Signature Financial Group Inc. in 1998. The effect was to boost patent protection for business methods, such as financial models, contract provisions, insurance policy features, computer-related inventions and Internet startups.

There were unintended effects, too. The U.S. Patent and Trademark Office was deluged with new patent applications and had few examiners with the expertise to handle them. Four Supreme Court justices have bemoaned the precedent, calling it vague and contrary. And several financial-services companies, frequent targets of the business-method-patent holder, have run up millions and in some cases billions of dollars in royalties and damages.

After a decade of disagreement over the precedent's bearing on American innovation, the Federal Circuit decided Feb. 15 to revisit State Street through the lens of another case, In re Bilski, which lifts State Street's holding on business methods and attempts to carry it further.

In a rare move, the court scheduled an en banc hearing without prompting by the parties in the case. The hearing is set for May 8.

Read the whole thing here.