Since the eighteenth century, the scope of patentable subject matter under the Patent Act has encompassed four categories—“process, machine, manufacture, or composition of matter.”[1] Until recently, these categories were broadly construed to encompass “anything under the sun that is made by man.”[2] In the 1998 State Street Bank decision, the Federal Circuit made it clear that this broad scope of patentable subject matter also includes business methods.[3] In that case, the patented invention related to a method of allowing multiple mutual funds to pool their resources and take advantage of economies of scale.[4] The next year, the Federal Circuit held in AT&T v. Excel

that any process that provides a “useful, concrete, tangible result” is patentable subject matter.[5]

The Board of Patent Appeals and Interferences followed the AT&T holding in Ex Parte Lundgren, which rejected a separate “technological arts” requirement and found that an invention of a method of compensating a business manager based on comparative performance, which did not require the

use of a computer or any specific machinery, was patentable subject matter.[6]

Recently, the Federal Circuit issued two opinions that substantially narrow what was previously thought to be within the purview of 35 U.S.C. § 101. The Federal Circuit held that a business method, when not combined with a machine such as a computer, is not patentable, and that a

signal, on its own, is also not patentable. These two decisions create three new conditions for patentability not previously recognized in the case law: a “technological arts” requirement, a “nontransience” requirement, and a “tangibility” requirement.