WHY BUSINESS METHOD PATENTS?

The rise of business method patents in the late twentieth century, and the controversy that has accompanied such patents over the last decade, has often been cast as being precipitated by novel judicial precedent that radically departed from traditional understandings of patentable subject matter. In particular, the Federal Circuit's decision in State Street Bank & Trust Co. v. Signature Financial Group has often been described, especially by opponents of business method patents, as an example of judicial activism that introduced patents into a field where patenting was unwanted and unnecessary. This Article demonstrates that such an explanation for the rise of business method patents is not accurate. The rise of business method patents was generated not so much by any court decision or other change in the legal system, but rather by fundamental technological and industrial changes that, during the second half of the twentieth century, began to transform many business fields into branches of engineering. This Article documents those technological and industrial changes and shows that the rise of business method patents is in fact an excellent case study in which the law followed, and accommodated, dramatic changes happening elsewhere in society.