Editor’s note: Rob Tiller is vice president and assistant general counsel for intellectual property at Red Hat.

RALEIGH, N.C. – Last week the Federal Circuit issued a major decision, In re Bilski, concerning the subject matter limits of patent law. The case presented questions relating to software patents, an issue of great significance to the free and open source software community (FOSS), and so Red Hat filed a brief in Bilski to educate the appeals court about FOSS and its problems with the software patents.

In the new opinion, the court cited Red Hat’s brief, but declined to settle the issue of when, if ever, software based inventions should be patentable. Even so, the new test in Bilski will probably limit the patentability of software. The war is not over, but the odds of success for FOSS just got better.

As we explained to the court in our brief, everyone recognizes that the purpose of patents is to foster innovation, but the patent system tends to hinder innovation for FOSS. History shows that software innovation happens without patents: prior to the 1990s, there were few software patents, but software developers produced programs that were not only innovative, but world changing. The Federal Circuit decisions in the late 1990s that allowed software patents produced a land grab that has led to more than 200,000 software patents today. Many of these patents are of poor quality, and many have vague boundaries. There is no practical way to “clear” any given program by examining all the possible patents that might apply to the features or functionality of the program. This means that the risk of lawsuits is a fact of life for the software innovators. Plainly this risk has not stopped innovation, but it is an inhibiting factor.

Bilski does not cure this problem, but it is a step in the right direction. The Federal Circuit decided to abolish the “useful, concrete, and tangible result” test that had been applied to allow dubious software patents. It substituted a new test: to be patentable, a process must be either “tied to a particular machine or apparatus” or must “transform a particular article into a different state or thing.” The discussion of “transformation” indicates that this option probably will not cover typical kinds of software-based inventions. The question for future cases is whether “tied to a particular machine” will be interpreted broadly to favor software patents based on the mere tie between software and a general purpose computer on which it is supposed to run.

If “tied to a particular machine” is interpreted narrowly, many existing “method” claims in software patents will be unenforceable. This possibility was recognized in the dissenting opinion in Bilski by Judge Newman, who said, “For the thousands of inventors who obtained patents under the court’s now-discarded criteria, their property rights are now vulnerable.”

There are good arguments against a broad interpretation of “tied to a particular machine.” The Supreme Court’s Benson decision, which was a primary authority for the Bilski court, involved claims covering an algorithm implemented in software running on a general purpose computer, and the Supreme Court concluded that the process claims were not directed to patentable subject matter. Moreover, a recent PTO Board of Patent Appeals decision, Ex parte Langemyr, found that a general purpose computer was not a “particular machine” for purposes of determining whether a claimed process is patentable.

But some patent lawyers will undoubtedly argue the other way. Patent trolls and other beneficiaries of the status quo will battle fiercely to reverse Bilski if the Supreme Court reviews it, or else they will promote narrow interpretations in future cases. Failing that, they will seek new protection through federal legislation. They will lobby influential members of Congress with all the resources at their command.

The FOSS community needs to start preparing for this battle. We will need to present our best legal arguments regarding the case law and FOSS to our courts. We will need to tell our legislators about the practical realities of software patents. We will need to continue to challenge received wisdom about innovation in software and the effect of patents. But let us give a cheer for the Bilski court, which has opened up a pathway for change. We have a battle before us, but it is a battle we can win.