No. 08-964
IN THE
Supreme Court of the United States
 
BERNARD L. BILSKI AND RAND A. WARSAW,
Petitioners,
v.
JOHN J. DOLL, ACTING UNDER SECRETARY OF
COMMERCE FOR INTELLECTUAL PROPERTY AND
ACTING DIRECTOR OF THE UNITED STATES
PATENT AND TRADEMARK OFFICE,
Respondent.
_______________________________
ON WRIT OF CERTIORARI TO THE UNITED STATES
COURT OF APPEALS FOR THE FEDERAL CIRCUIT
BRIEF OF TELES AG AS AMICUS CURIAE
IN SUPPORT OF NEITHER PARTY
THOMAS S. BIEMER
Counsel of Record
STEVEN I. WALLACH
PHILIP J. FORET
DILWORTH PAXSON LLP
1500 Market Street 3500E
Philadelphia, PA 19102
(215) 575-7000
August 6, 2009
Counsel for Amicus Curiae
A
(800) 274-3321 • (800) 359-6859

i
Cited Authorities
TABLE OF CONTENTS
Page
TABLE OF CITED AUTHORITIES  . . . . . . . . .
iii
INTEREST OF AMICUS CURIAE  . . . . . . . . . .
1
SUMMARY OF ARGUMENT  . . . . . . . . . . . . . . .
2
ARGUMENT  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4
I.
TO FURTHER THE PUBLIC POLICY
OF THE PATENT LAWS TO PROMOTE
INNOVATION, THE STANDARDS FOR
PATENTABLE SUBJECT MATTER
SHOULD REMAIN DYNAMIC  . . . . . . .
4
A. The Patent Act And This Court’s
Precedents Recognize That The
Purpose Of The Patent System Is To
Foster Innovation  . . . . . . . . . . . . . . . . .
4
B. Modern Innovation Is Inherently
Dynamic, As Should Be The
Standards For Patentable Subject
Matter . . . . . . . . . . . . . . . . . . . . . . . . . . .
6
II. BECAUSE GLOBAL PATENTING
STRATEGIES SEEK OUT EFFEC-
TIVE PATENT SYSTEMS WORLD-
WIDE, DYNAMIC STANDARDS FOR
PATENTABILITY BEST PROMOTE
INNOVATION IN THE UNITED
STATES  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8

ii
Cited Authorities
Contents
Page
A. International Entrepreneurs Seek
Return On Investment For
Innovation In Jurisdictions With
Robust Patent Systems  . . . . . . . . . . .
8
1. A Developed United States
Patent System Supports
Investment in Innovation  . . . . . .
10
2. A Developed European Patent
System Supports Investment In
Innovation . . . . . . . . . . . . . . . . . . . .
16
B. Harmonizing Patent Systems
Supports Investment In
Innovation  . . . . . . . . . . . . . . . . . . . . . . .
21
CONCLUSION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25

iii
T
Cited Authorities
ABLE OF CITED AUTHORITIES
Page
Cases
Cochrane v. Deener, 94 U.S. 780 (1876)  . . . . 11, 13, 14
Diamond v. Chakrabarty, 447 U.S. 303 (1980)  . . 5, 6, 15
Diamond v. Diehr, 450 U.S. 175 (1981)  . . 5, 12, 14, 15
Expanded Metal Co. v. Bradford, 214 U.S. 366
(1909) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13
Gottschalk v. Benson, 409 U.S. 63 (1972)  . . 13, 14, 15
O’Reilly v. Morse, 56 U.S. (15 How.) 62 (1854) . . . .
13
Parker v. Flook, 437 U.S. 584 (1978)  . . . . . . . . . 14, 15
Smith v. Snow, 294 U. S. 1 (1935)  . . . . . . . . . . . . .
13
The Telephone Cases, 126 U.S. 1 (1887)  . . . . . . .
13
Tilghman v. Proctor, 102 U.S. 707 (1881)  . . . . . .
13
Waxham v. Smith, 294 U.S. 20 (1935)  . . . . . . . . .
13
Constitutional Provisions
U.S. Const., art. I, § 8, cl. 8  . . . . . . . . . . . . . . . . . .
5

iv
Cited Authorities
Page
Statutes
35 U.S.C. § 100(b) (2009)  . . . . . . . . . . . . . . . . . . . 5, 7, 12
35 U.S.C. § 101 (2009)  . . . . . . . . . . . . . . . . . . . . . 5, 7, 12
European Patent Convention
Convention on the Grant of European Patents
(EPC) Art. 52 ¶ 1  . . . . . . . . . . . . . . . . . . . . . . . . .
16
EPC Art. 52 ¶¶ 2-3  . . . . . . . . . . . . . . . . . . . . . . . . . .
17
EPC Art. 56  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17
European Patent Office Boards of
Appeal Decisions
Case T 1002/92, Queueing system/Pettersson,
O.J. E.P.O. 1995, 605 (1994)  . . . . . . . . . . . . . . . .
19
Case T 172/03, Order management/Ricoh, O.J.
E.P.O.  (2003)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
18
Case T 208/84, Computer-related invention/
VICOM, O.J. E.P.O. 1987, 014 (1986)  . . . . . . . .
19
Case T 258/03, Auction method/Hitachi, O.J.
E.P.O. 2004, 575 (2004) . . . . . . . . . . . . . . . . . . . . .
18

v
Cited Authorities
Page
Case T 6/83, Data processor network/IBM, O.J.
E.P.O. 1985, 67 (1988) . . . . . . . . . . . . . . . . . . . . . .
19
Case T 641/00, Two identities/Comvik, O.J. E.P.O.
2003, 352 (2002) . . . . . . . . . . . . . . . . . . . . . . . . . . .
18
Case T 931/95, Controlling pension benefits
system/PBS Partnership, O.J. E.P.O. 2001, 441
(2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17, 18, 21
Other Authorities
5  Writings of Thomas Jefferson 75-76
(Washington ed. 1871)  . . . . . . . . . . . . . . . . . . . . .
6
Abraham Lincoln, Second Lecture on
Discoveries and Inventions (Feb. 11, 1859), in
3  The Collected Works of Abraham Lincoln,
at 356-63 (Roy P. Basler ed., Rutgers U. Press
1953)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
Adam B. Jaffe & Josh Lerner, Innovation and
Its Discontents 79 (Princeton U. Press 2004)
 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
Ashish Arora & Marco Ceccagnoli, Patent
Protection, Complementary Assets, and
Firms’ Incentives for Technology Licensing,
52 Mgmt. Sci. 293 (2006)  . . . . . . . . . . . . . . . . . . . 9, 22

vi
Cited Authorities
Page
Du Guodong, Introduction of China’s
Intellectual Property System, (2008),
available at http://English.gov.cn/2008-06/14/
content_1016453.htm  . . . . . . . . . . . . . . . . . . . . .
23
Eric S. Langer, China Today: Intellectual
Property Protection in China: Does it
Warrant Worry?, (2007)  . . . . . . . . . . . . . . . . . . 22, 23
European Patent Office, Guidelines for
Examination in the European Patent Office
C-IV, 2.3.6 (2009)  . . . . . . . . . . . . . . . . . . . . . . . . . .
20
John W. Sutherlin, Intellectual Property Rights:
The West, India, and China, 8 PGDT 399, 410
(2009) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22, 23
Knut Blind et al., Motives to Patent: Empirical
Evidence from Germany, 35 Res. Pol’y 655,
656 (2006)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9
Lulin Gao, China’s Patent System and
Globalization, 51(6) Research-Technology
Management 34 (2008)  . . . . . . . . . . . . . . . . . . . .
23

vii
Cited Authorities
Page
Sisir Botta & Christopher Tsai, Globalization
is a Catalyst for Change in Intellectual
Property Systems: Case Studies in India
and China (2004), available at http://
net.shams.edu.eg/ecourses/Aeronautics
% 2 0 a n d % 2 0 A s t r o n a u t i c s / u n d e r % 2 0 &
g r a d / I n v e n t i o n s % 2 0 a n d % 20Patents,%
20Fall%202003/pro/1.pdf.  . . . . . . . . . . . . 9, 22, 23, 24


1
This brief in support of neither party is filed on
behalf of amicus curiae TELES AG (TELES). TELES
has no financial interest in Petitioners.1
INTEREST OF AMICUS CURIAE
TELES, a German high-technology company, is a
typical “American” success story. Founded in 1983, and
listed on the Prime Standard segment of the Frankfurt
Stock Exchange in 1998, TELES conceives and
commercializes innovative products and services in the
telecommunications and information technology
industry. The same entrepreneurial spirit that drives
the United States economy has been integral to
TELES’s success. As a quantifiable example of that
success, TELES has paid dividends of over $100,000,000
to its shareholders.
TELES relies on the strength of patent rights
awarded in the United States, Europe, and elsewhere
to protect its investments in research and development.
Consequently, when commercializing a new product or
service, TELES concentrates its resources in countries
having robust patent systems. TELES therefore has a
vested interest in supporting patent systems that
properly reward innovation.
1 Pursuant to Rule 37.6 of the Rules of the United States
Supreme Court, TELES states that no counsel for a party
authored this brief in whole or in part, and no counsel or party
made a monetary contribution intended to fund the preparation
or submission of this brief. No person other than amicus curiae,
its members, or its counsel made a monetary contribution to its
preparation or submission. The parties have consented to the
filing of this brief.

2
SUMMARY OF ARGUMENT
1. It is clear that the future economic strength of
the United States will rely greatly on cutting-edge
technologies – such as artificial intelligence, genetic
programming, and human-machine communications –
that in the broadest sense are not “physical” or
“tangible.” But the “machine-or-transformation test”
set forth by the Federal Circuit gives cause for serious
concern that patentability will be statically limited to
“physical” or “tangible” implementations of technical
developments, largely excluding innovations in such
cutting-edge technologies. TELES therefore submits
that, to continue to promote the wealth of society by
providing meaningful incentives to stimulate innovation,
only a dynamic standard for patentable subject matter
is consistent with United States patent laws and policy
and this Court’s precedents.
TELES also recognizes that awarding patents for
trivial inventions – i.e., inventions that do not
meaningfully push back the frontiers of knowledge – can
hinder innovation. TELES thus suggests retaining a
test for patentability that ensures that an invention is
protectible if it makes a nontrivial contribution in the
field of “useful arts” – i.e., the four expansive categories
of patentable subject matter identified in Section 101
of the patent statutes.
Several principles are important to companies like
TELES when determining where to invest capital. First,
robust patent systems are dynamic: they promote
innovation across all areas of technology – including
those that may not have existed at the Nation’s founding

3
or during the Industrial Age – by rewarding inventors
with effective patents. Second, robust patent systems
apply an inclusive approach to patentable subject matter
that avoids limitations based on the “phenotype” of an
innovation – i.e., restricting patentability only to
inventions that are “physical” or “tangible” types,
leaving other types of innovation unpatentable. Third,
robust patent systems reward inventors only for their
specific contributions over the prior art. According the
test for patentable subject matter with those three
general principles, by preserving dynamic standards for
patentability, will promote the flow of international
capital into the United States and further the purpose
of the Nation’s patent laws.
2. The global nature of patenting strategies
recommends that the laws of effective patent systems
around the world should be – or should remain –
harmonized whenever possible. In today’s globalized
economy, patenting strategies examine the strengths
and weaknesses of patent systems worldwide. To
maximize return on investment, international
entrepreneurs are attracted to jurisdictions with robust
patent systems. For example, both the United States
and Europe enjoy well-developed patent systems that
have included a dynamic view of patentable subject
matter that rewards real innovations in all areas of
technology – with no arbitrary, judicially created “carve-
outs” from patentability for certain industries or end-
uses.
Among the world’s robust patent systems, the laws
regarding patentable subject matter are already largely
harmonized, and this area of patent law in the United

4
States should remain so. Were this Court to depart from
broad, flexible patentability standards, the United
States would be at a competitive disadvantage –
compared, for example, with Europe – in attracting the
international investment that follows effective patent
systems. Such a competitive disadvantage would be
inconsistent with the policy goals undergirding the
United States patent system, further indicating that the
Court should retain expansive, dynamic standards of
patentability for specific, nontrivial innovations in all
technologies.
ARGUMENT
I. TO FURTHER THE PUBLIC POLICY OF THE
PATENT LAWS TO PROMOTE INNOVATION,
THE STANDARDS FOR PATENTABLE
SUBJECT MATTER SHOULD REMAIN
DYNAMIC
Robust patent systems are designed to provide
wealth to societies by stimulating innovation for all
sectors of the economy and all areas of technology. The
United States patent system has done this for over two
hundred years by rewarding innovations that
meaningfully advance public knowledge with effective
patents.
A. The Patent Act And This Court’s Precedents
Recognize That The Purpose Of The Patent
System Is To Foster Innovation
The United States Constitution expressly
authorizes a patent policy “to promote the Progress

5
of . . . the Useful Arts, by securing for limited Times to
. . . Inventors the exclusive right to their . . .
Discoveries.”2 Effectuating this general principle,
Congress enacted patent statutes that expansively
embrace the economic benefits of awarding patents for
innovation by providing that “[w]hoever invents or
discovers any new and useful process, machine,
manufacture, or composition of matter, or any new and
useful improvement thereof, may obtain a patent
therefor . . . .”3 Tellingly, the statutory language excludes
no particular area of the economy and prescribes no
static understanding of technology.
Given such Congressionally mandated breadth,
when assessing whether an invention presents
patentable subject matter, instead of asking “Why?” the
proper question is “Why not?”
Consonant with the expansive statutory language,
this Court has consistently recognized the dynamic
nature of innovation by broadly interpreting the
meaning of patentable subject matter under Section
101. In its most recent decisions, in Chakrabarty and
Diehr,4 the Court upheld a broad standard by expressly
refusing to read limitations and conditions into the
statute. The legislative intent of Congress, as properly
understood and explained by this Court, presents clear
support for a dynamic standard for determining
2 U.S. Const., art. I, § 8, cl. 8.
3 35 U.S.C. § 101 (2009); see also 35 U.S.C. § 100(b) (2009)
(defining “process” capaciously).
Diamond v. Chakrabarty, 447 U.S. 303, 308-309 (1980);
and Diamond v. Diehr, 450 U.S. 175, 192 (1981).

6
patentable subject matter in accord with Thomas
Jefferson’s philosophical view that “ingenuity should
receive liberal encouragement.”5 That philosophy has
sagely guided United States patent policy for over two
hundred years and has achieved a robust patent system
that continues to serve this country well.
B. Modern Innovation Is Inherently Dynamic,
As Should Be The Standards For Patentable
Subject Matter
Naturally, the encouragement to innovate that the
United States and other patent systems provide cannot
apply to inventions excluded from patentable subject
matter. Therefore, robust patent systems should reward
true innovation in all areas of technology, in all sectors
of the economy, and at all levels of maturity, whether
long-existing, currently developing, or newly pioneering.
Innovation, in turn, is fundamentally a dynamic process.
In order to maximally foster innovation, the standard
for patentable subject matter must also be dynamic.
Thus, to fully realize the constitutional and statutory
goals, this Court should ensure that the United States
patent system provides its benefits to all areas of the
economy and is not frozen in place at any point in time.
In particular, the standard for patentable subject
matter should not embrace peculiar industry or end-
use exclusions or “carve-outs.” Such carve-outs for
certain somehow-disfavored technologies or industries
would stifle innovation by limiting protection and
Chakrabarty, 447 U.S. at 308-309 (citing 5 Writings of
Thomas Jefferson 75-76 (Washington ed. 1871)).

7
enforcement of rights in innovation in the carved-out
areas, impeding the flow of capital into research and
development in those areas. Thus, limiting patentable
inventions with such artificial, judicially created
exclusions would contradict the constitutional purpose,
ignore the unambiguous mandate of Congress found in
Sections 100(b) and 101 of the patent statutes, and
disregard this Court’s precedents.
On the other hand, it is well understood that patent
grants impede innovation if they cover fundamental
principles or trivial inventions – i.e., inventions that do
not specifically contribute to and advance the state of
the art. Such grants are impermissible under the patent
statutes and this Court’s precedents, and should be
impermissible under the otherwise broad standards for
assessing patentable subject matter, which should
dynamically embrace all manner of technologies.
TELES generally agrees with the discussion of the
law concerning patentable subject matter in Petitioners’
merits brief. And while taking no position on the ultimate
disposition for Petitioners’ patent application in this
case, TELES does consider that the patentability of
claim 1 is less supportable than the patentability of
claim 4.

8
II. BECAUSE GLOBAL PATENTING STRATEGIES
SEEK OUT EFFECTIVE PATENT SYSTEMS
WORLDWIDE, DYNAMIC STANDARDS
FOR PATENTABILITY BEST PROMOTE
INNOVATION IN THE UNITED STATES
International entrepreneurs like TELES weigh the
benefits of patent systems throughout the world when
considering allocating their resources and the risks and
rewards of bringing innovations to market.
Consequently, a robust patent system attracts
international capital in a manner that aligns precisely
with the long-standing goal of the United States patent
system to encourage innovation. Further, the global
nature of today’s economy strongly recommends that
the United States patent system be harmonized with
robust patent systems of other nations wherever
possible. And in the area of patentable subject matter,
the laws of jurisdictions with robust patent systems are
already largely harmonized around expansive, dynamic
standards of patentability.
A. International Entrepreneurs Seek Return On
Investment For Innovation In Jurisdictions
With Robust Patent Systems
The encouragement to innovate that the patent
system provides is made manifest by a patent’s grant of
a limited period of exclusive rights. These exclusive
rights drive the goals of strategic patenting, which are
primarily two-fold. First, offensively, patenting
strategies obtain protection to help prevent innovation
from being copied by competitors in the market, and to
provide remedies if copying occurs. Second, defensively,

9
inventors seek to avoid having their technological room
to maneuver limited by the patents of others.6
International entrepreneurs weigh these two goals
heavily when considering global patenting strategies
and the protection afforded throughout the world by
patent systems in various jurisdictions (primarily
nations and regional confederations such as the
European Patent Organization). Jurisdictions with
robust patent systems, such as the United States and
Germany, have historically played a key role in
accelerating innovation in global markets and have
experienced the creation of wealth that accompanies
such innovation.7 In contrast, jurisdictions having weak
patent systems are struggling to attract investment in
innovation.8
Expanding innovation in international markets
relies heavily on effective patents.9 Effective protection
in countries having robust patent systems serves as the
basis for disseminating innovation to global partners in
6 Knut Blind et al., Motives to Patent: Empirical Evidence
from Germany, 35 Res. Pol’y 655, 656 (2006).
7 Ashish Arora & Marco Ceccagnoli, Patent Protection,
Complementary Assets, and Firms’ Incentives for Technology
Licensing, 52 Mgmt. Sci. 293 (2006).
8 Sisir Botta & Christopher Tsai, Globalization is a
Catalyst for Change in Intellectual Property Systems: Case
Studies in India and China (2004), available at http://
n e t . s h a m s . e d u . e g / e c o u r s e s / A e r o n a u t i c s % 2 0 a n d % 2 0
Astronautics/under%20&grad/Inventions% 20and%20Patents
,%20Fall%202003/pro/1.pdf.
9 Blind, Motives to Patentsupra at 665-70.

10
other such countries, whether subsidiaries, affiliates, or
unaffiliated licensees. Particularly in the computer and
telecommunications sectors, patenting technology is
critical to protect the innovator from competitors’ patent
infringement.
1.
A Developed United States Patent System
Supports Investment in Innovation
Though probably self-evident, the notion that no
patent system is perfect recently received additional
confirmation from two economics professors. They
studied the history of patent systems around the world
in order, among other things, to illustrate the lesson that
[t]here are no easy solutions to the problems
of running a patent system. There is an
inherent trade-off in this system, between
rewarding innovators and burdening
commerce, competition, and other inventors.
Numerous approaches have been attempted
over the years, and none has satisfied
everyone.10
Despite these problems, the approaches that
Congress has adopted have, in Lincoln’s phrase, “added
the fuel of interest to the fire of genius”11 to produce
10 Adam B. Jaffe & Josh Lerner, Innovation and Its
Discontents 79 (Princeton U. Press 2004).
11 Abraham Lincoln, Second Lecture on Discoveries and
Inventions (Feb. 11, 1859), in 3 The Collected Works of Abraham
Lincoln, at 356-63 (Roy P. Basler ed., Rutgers U. Press 1953).

11
substantial wealth and other benefits of progress
throughout the Nation’s history. And since the first
Congress exercised its power under the Constitution’s
patent clause, a dynamic view of patentable subject
matter has been a part of a robust United States patent
system that has been spectacularly successful in
spurring innovation.
In its assessment of patentable subject matter in
this case, the Federal Circuit adopted a machine-or-
transformation test as the sole test for determining
whether process inventions are protectible. But this test
when applied is very ambiguous. If applied statically, it
could be understood to require that patentable
inventions show some kind of “physical” or “tangible”
element.
A static application of the machine-or-
transformation test is possible – indeed likely – because
the wording of the test goes back this Court’s 1876
decision in Cochrane v. Deener,12 when modern cutting-
edge technologies such as artificial intelligence, genetic
programming, and human-machine communications
were not at all visible on the horizon. Therefore, the
wording of this test implicitly reflects the fact that at
that time patentable inventions typically had a
“physical” or “tangible” phenotype – i.e. patentable
inventions were typically tied to a mechanical or
electromechanical machine, or to a process, in then-
known areas of industry.
12 Cochrane v. Deener, 94 U.S. 780, 788 (1876).

12
TELES submits that such (possible) application of
the machine-or-transformation test would be totally
unacceptable if the United States patent system is to
continue encouraging innovation in the future. Such a
static test would largely exclude innovations in the
cutting-edge technologies of the 21st century and
beyond, where frequently technological break-throughs
will no longer be tied to any kind of tangible machine or
process. Clearly the future economic strength of the
United States will rely significantly on such cutting-edge
technologies, not “physical” or “tangible” inventions.
Instead of the static machine-or-transformation
test, TELES respectfully suggests that this Court take
the opportunity of this case to retain the flexible,
visionary approach of its precedents on patentability.
More particularly, TELES submits that patentability
should not depend on the “phenotype” of an invention,
but rather on the nature of its contribution to the state
of the art. As long as the innovation makes a nontrivial
contribution to the field of “useful arts,” as authorized
in the Constitution and defined by Congress in Sections
100(b) and 101, it should be immaterial which field of
human endeavor the invention ultimately benefits.
The proper test would also implement the “long-
established principles” that “laws of nature, natural
phenomena, and abstract ideas”13 are excluded from the
protection because – if taken alone – they inherently
contribute no nontrivial, practical application to the field
of useful arts.
13 Diehr, 450 U.S. at 185.

13
In addition, an inflexible machine-or-transformation
test as the sole standard for determining patentable
subject matter has repeatedly been rejected by this
Court. In Benson, the Court duly noted the language of
Cochrane concerning transforming an article to a
different state or thing, and other older cases.14 But the
Court went on to explain that its prior precedents did
not set out exclusive requirements for deeming a process
patentable:
It is argued that a process patent must either
be tied to a particular machine or apparatus
or must operate to change articles or
materials to a “different state or thing.”
We do not hold that no process patent
could ever qualify if it did not meet the
requirements of our prior precedents.15
Recognizing that Cochrane and other early decisions
pertained to mechanical inventions conceived in a
bygone era, the Court made clear that it was using a
dynamic standard: “It is said we freeze process patents
to old technologies, leaving no room for the revelations
of the new, onrushing technology. Such is not our
purpose.”16
14 See Gottschalk v. Benson, 409 U.S. 63, 68-71 (1972) (citing
Waxham v. Smith, 294 U.S. 20, 22 (1935); Smith v. Snow, 294 U.
S. 1 (1935); Expanded Metal Co. v. Bradford, 214 U.S. 366, 385-
86 (1909); The Telephone Cases, 126 U.S. 1, 534, 535, 538 (1887);
Tilghman v. Proctor, 102 U. S. 707, 721 (1881); Cochrane v.
Deener, 94 U.S. 780, 785, 787-88 (1876); O’Reilly v. Morse, 56
U.S. (15 How.) 62, 111, 112, 113 (1854)).
15 Benson, 409 U.S. at 71.
16 Id.

14
Consistent with Benson, in Flook this Court again
explicitly rejected the argument that patentable
processes should be limited to those meeting static tests
used in earlier decisions:
The statutory definition of “process” is broad.
An argument can be made, however, that this
Court has only recognized a process as within
the statutory definition when it either was tied
to a particular apparatus or operated to
change materials to a “different state or
thing.” As in Benson, we assume that a valid
process patent may issue even if it does not
meet one of these qualifications of our earlier
precedents.17
The problem with the claimed invention in Flook,
as the Court later explained in Diehr, was not lack of
any machine or transformation, but lack of any specific
contribution over the prior art apart from an
unpatentable algorithm:
The [Flook] application, however, did not
purport to explain how these other variables
were to be determined, nor did it purport “to
contain any disclosure relating to the chemical
processes at work, the monitoring of the
process variables, nor the means of setting off
an alarm or adjusting an alarm system. All
17 Parker v. Flook, 437 U.S. 584, 589 n.9 (1978) (quoting
Cochrane, 94 U.S. at 787).

15
that it provides is a formula for computing an
updated alarm limit.”18
Also in Diehr, this Court characterized the decisions
in  Benson and Flook not as setting forth a single,
inflexible standard, but rather as modern applications
of the “long-established principles” that “[e]xcluded
from . . . patent protection are laws of nature, natural
phenomena, and abstract ideas.”19 And consistent with
its prior cases, the Court in Diehr identified
transformation as just one example of patent-
protectible functions:
[W]hen a claim containing a mathematical
formula implements or applies that formula
in a structure or process which, when
considered as a whole, is performing a function
which the patent laws were designed to
protect (e.g., transforming or reducing an
article to a different state or thing), then the
claim satisfies the requirements of §101.20
Although some observers consider this Court’s
precedents concerning patentable subject matter to be
irreconcilable, they all stand for one or both of two
18 Diehr, 450 U.S. at 186-87 (quoting Flook, 437 U.S. at 586);
see also Chakrabarty, 447 U.S. at 315 (iterating that the Court’s
precedents were consistent with Section 101’s “[b]road general
language” and explaining that “Flook did not announce a new
principle that inventions in areas not contemplated by Congress
when the patent laws were enacted are unpatentable per se.”).
19 Diehr, 450 U.S. at 185.
20 Id. at 192.

16
propositions. First, trivial inventions that do not
specifically advance publicly available knowledge are not
patentable. Second, the standards for patenting
processes should be broadly applied and dynamically
considered, limited only by the three exclusions for
patentable subject matter: laws of nature, natural
phenomena, and abstract ideas.
2.
A Developed European Patent System
Supports Investment In Innovation21
In Europe, the most important source of patent law
is the European Patent Convention,22 which in 1973
established the European Patent Organization. The
now-35-member European Patent Organization
(including all EU countries) operates the European
Patent Office (EPO), which the EPC authorizes to grant
patents on behalf of all member states.
Article 52 of the EPC broadly defines patentable
subject matter:
European patents shall be granted for any
inventions, in all fields of technology, provided
that they are new, involve an inventive step
and are susceptible of industrial application.23
21 TELES gratefully acknowledges the contributions to this
section of Dr. Ralph Nack of Bird & Bird LLP, Munich.
22 Convention on the Grant of European Patents of 5
October 1973, as revised by the Act revising Article 63 EPC of
17 December 1991 and the Act revising the EPC of 29 November
2001, art. 52, available at http://www.epo.org/about-us/
publications/procedure/epc-2000.html [hereinafter EPC].
23 Art. 52 ¶ 1 EPC

17
Article 52 of the EPC also lists certain inventions –
including “programs for computers” – that if claimed
“as such” are not regarded as inventions in a field of
technology.24 But given several decisions by the EPO
technical boards of appeal (including those discussed
below), in practice this list of exclusions from
patentability is essentially meaningless.
Significantly, it is widely accepted that under the
EPC patentability is not limited to a specific
“phenotype” of innovations. In particular, a “machine-
or-transformation test” suggesting a limitation to
“physical” or “tangible” inventions is completely alien
to European patent-law doctrines.
For example, since a 2000 decision of an EPO board
of appeal – known familiarly as the Pension Benefits case
– it is settled caselaw of the EPO and the courts of the
EPC member states that patentability will be examined
by applying a two-step test: First, under Article 52 of
the EPC, the invention must be examined to determine
whether it is – if considered as a whole – an invention in
a field of technology. Second, under Article 56 of the
EPC, the invention must be assessed to determine
whether it makes a nonobvious contribution (i.e.,
“involve[s] an inventive step”) to the state of the art in
a field of technology, or whether its contribution to the
art is in a field of human endeavour not considered to
be technology.25
24 Art. 52 ¶¶ 2-3 EPC.
25 See Art. 56 EPC; see also Case T 931/95, Controlling
pension benefits system/PBS Partnership, O.J. E.P.O. 2001, 441
(2000) [hereinafter Pension Benefits].

18
The first requirement is fulfilled if the claimed
subject matter contains technical elements – i.e., is
somehow linked to a field of technology. It is important
to note, as did the EPO board in the Pension Benefits
case, that it is immaterial whether or not the “technical
elements” of the claimed invention are new or even
inventive:
There is no basis in the EPC for
distinguishing between “new features” of an
invention and features of that invention which
are known from the prior art when examining
whether the invention concerned may be
considered to be an invention within the
meaning of Article 52(1) EPC. Thus there is
no basis in the EPC for applying this so-called
contribution approach for this purpose.26
That a patentable invention may combine technical
and nontechnical elements was confirmed in a 2002 EPO
board decision:
It is legitimate to have a mix of technical and
“non-technical” features (i.e. features relating
to non-inventions within the meaning of
Article 52(2) EPC) appearing in a claim, even
if the non-technical features should form a
dominating part.27
26 T 931/95, Pension Benefits.
27 Case T 641/00, Two identities/Comvik, O.J. E.P.O. 2003,
352 (2002); see also Case T 258/03, Auction method/Hitachi, O.J.
E.P.O. 2004, 575 (2004); Case T 172/03, Order management/
Ricoh, O.J. E.P.O. __, __ (2003), available at http://www.epo.org/
patents/appeals/search-decisions.html (search T_0172/03).

19
But the fundamental doctrine underlying this two-
part test existed in European patent law from the very
beginning, even before the test was formally introduced
into EPO caselaw. For example, the fundamental
doctrine was discussed in a 1986 EPO board of appeal
decision:
Generally speaking, an invention which would
be patentable in accordance with conventional
patentability criteria should not be excluded
from protection by the mere fact that for its
implementation modern technical means in
the form of a computer program are used.
Decisive is what technical contribution the
invention as defined in the claim when
considered as a whole makes to the known
art.28
With respect to computer programs, the EPO
examination guidelines describe this fundamental
doctrine as providing a “technical effect”:
[I]f a computer program is capable of bringing
about, when running on a computer, a further
technical effect going beyond these normal
physical effects, it is not excluded from
patentability.  This further technical effect
may be known in the prior art. A further
technical effect which lends technical
character to a computer program may be
28 Case T 208/84, Computer-related invention/Vicom, O.J.
E.P.O. 1987, 014 (1986); see also Case T 6/83, Data processor
network/IBM, O.J. E.P.O. 1985, 67 (1988); Case T 1002/92,
Queueing system/Pettersson, O.J. E.P.O. 1995, 605 (1994).

20
found e.g. in the control of an industrial
process or in processing data which represent
physical entities or in the internal functioning
of the computer itself or its interfaces under
the influence of the program and could, for
example, affect the efficiency or security of a
process, the management of computer
resources required or the rate of data transfer
in a communication link. As a consequence, a
computer program may be considered as an
invention within the meaning of Art. 52(1) if
the program has the potential to bring about,
when running on a computer, a further
technical effect which goes beyond the normal
physical interactions between the program
and the computer.29
It is important to note that, according to the EPO
examination guidelines, any kind of computer-related
invention passes the test of Article 52 of the EPC as
long as “technical elements” such as display units,
servers, or networks are mentioned in the patent claim.
The second step of the patentability test is
illustrated in the Pension Benefits EPO board decision,
where an improved algorithm for administrating a
pension fund was deemed unpatentable:
Indeed, the improvement envisaged by the
invention according to the application is an
29 European Patent Office, Guidelines for Examination in
the European Patent Office C-IV, 2.3.6 (2009) (emphasis added),
available at http://www.epo.org/about-us/publications/
procedure/guidelines-2009.html [hereinafter Guidelines].

21
essentially economic one, i.e. lies in the field
of economy, which, therefore, cannot
contribute to inventive step.30
In sum, despite the sometimes-restrictive effect of
the two-step patentability test, under the EPC
patentable subject matter is clearly not limited to a
specific “phenotype” of innovations. Limitations to
“physical” or “tangible” inventions are completely alien
to European patent-law doctrines.
B. Harmonizing Patent Systems Supports
Investment In Innovation
As the discussion above demonstrates, the
standards for patentability in the United States and
Europe are largely harmonized. Both jurisdictions’
patent laws include expansive, dynamic views of
patentable subject matter for nontrivial inventions. In
both patent systems, the concept of patentability avoids
any limitations to a specific “phenotype” of innovations,
and eschews any carve-outs for particular industries or
end-uses.
TELES submits that this Court should confirm that
the test for patentability in the United States does not
impose restrictions that are alien to other very successful
patent systems in the world. It is in the interest of any
nation not to deviate from globally accepted principles
of patent law, but imposing such restrictions would do
just that, producing a negative impact on investments
made by international companies in that nation. The
30 T 931/95, Pension Benefits.

22
flow of capital follows robust patent systems, such as
the United States patent system, that feature broad,
dynamic views of patentable subject matter.
In contrast, underdeveloped patent systems pose
substantial risk for investment in innovation, effectively
turning it away. These patent systems present uncertain
outcomes for obtaining and enforcing effective patents
and consequently deter capital expenditure in research
and development and international market expansion.
For years, international entrepreneurs shied away
from investing in innovation in China, India, and other
countries marred with a public perception of having
weak patent systems.31 The uncertainties of whether a
patent would be awarded for innovation and whether a
patent would be enforceable removed countries with
weak patent systems from consideration for global
market expansion until recent years.32 Because economic
progress relates to technological progress, and because
effective patents are strong drivers of both these forms
of progress, countries with weak patent systems enjoy
less economic and technological progress than do
countries with robust patent systems.
31 Botta & Tsai, Globalization is a Catalyst for Change in
Intellectual Property Systemssupra at 1; Eric S. Langer, China
Today: Intellectual Property Protection in China: Does it
War rant Wor ry?, (2007), available at http://biopharm
international.findpharma.com/biopharm/article/article
Detail.jsp?id=423187.
32 Arora & Ceccagnoli, Patent Protection, Complementary
Assets, and Firms’ Incentives for Technology Licensingsupra
at 296; John W. Sutherlin, Intellectual Property Rights: The
West, India, and China, 8 PGDT 399, 410 (2009).

23
For example, recognizing the importance of effective
patents, China made a first major overhaul of its patent
system in the 1980s and since then has sought continuous
reforms to make that country an attractive option for
global patenting strategies.33 In order to change public
perceptions of having a weak patent system, China
joined key international patent agreements, including
the Paris Convention and the Patent Cooperation Treaty,
among others. As a World Trade Organization (WTO)
member, China has developed its patent system to be in
line with the requirements for compliance the WTO’s
Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS).34 This has helped turn the
tide of negative public perception of China’s intellectual-
property laws.35 Part of China’s recent and substantial
economic growth is attributed to its attempts to create
a stronger patent system and effective processes for
enforcing rights, which have begun to change public
perceptions and help China evolve into a strong
presence in the global economy.36
33 Lulin Gao, China’s Patent System and Globalization,
51(6) Research-Technology Management 34 (2008); Du
Guodong, Introduction of China’s Intellectual Property System,
(2008),  available at http://English.gov.cn/2008-06/14/
content_1016453.htm.
34 Gao, China’s Patent System and Globalization,  supra at
35.
35 Botta & Tsai, Globalization is a Catalyst for Change in
Intellectual Property Systems,  supra at 12; Guodong,
Introduction of China’s Intellectual Property Systemsupra.
36 Langer, China Today: Intellectual Property Protection in
China: Does it Warrant Worry?,  supra; Sutherlin, Intellectual
Property Rights: The West, India, and Chinasupra at 410.

24
In contrast, India’s patent system is still widely
regarded as seriously flawed. India’s patent system has
a poor infrastructure and slow processes for enforcing
patent rights.37 These perceptions negatively impact
India’s economy, with relatively ineffective patent
protection offering little incentive for investing in
research and development.
Just as poor infrastructure and ineffective
enforcement mechanisms are hallmarks of weak patent
systems, an inflexible machine-or-transformation test
as the sole test for the patentability of processes would
weaken the Nation’s patent system, and concomitantly
lessen the incentives for inventing in this country.
Confirming that the standards of patentability are broad
and dynamic, remaining harmonized with robust patent
regimes such as Europe’s, will maintain the
effectiveness of patents in the United States. And
although the United States patent system, like all
others, has its problems, a broad and dynamic view of
patentable subject matter is not one of them.
37 Botta & Tsai, Globalization is a Catalyst for Change in
Intellectual Property Systems, supra at 2-3.

25
CONCLUSION
Innovation is dynamic; encouraging innovation
therefore requires that the standards for patentable
subject matter also be dynamic. And the patent system’s
incentives to innovate apply only as broadly as the scope
of patentable subject matter. The Federal Circuit’s
machine-or-transformation test gives cause for serious
concern that patentability will be limited to “physical”
or “tangible” implementations (“phenotypes”) of
technical developments, largely excluding innovations
in current and future cutting-edge technologies. To
further the constitutional and statutory goals of the
patent system, TELES respectfully suggests that this
Court retain an expansive, flexible test for patentability
that ensures that an invention is patentable if it makes
a specific, nontrivial contribution in the field of “useful
arts” – i.e., the four broad categories of patentable
subject matter identified in the patent statutes.
Respectfully submitted,
THOMAS S. BIEMER
Counsel of Record
STEVEN I. WALLACH
PHILIP J. FORET
DILWORTH PAXSON LLP
1500 Market Street 3500E
Philadelphia, PA 19102
(215) 575-7000
Counsel for Amicus Curiae
August 6, 2009