Courts have often had difficulty in fitting a legal framework around matters involving technological change. Over the years, as computers have played an increasingly dominant role in our everyday affairs, the patent landscape has shifted toward more of a focus on technology involving software.
Traditionally, inventions have been evaluated based on novelty, usefulness, and non-obviousness. However, as the United States Patent and Trademark Office (USPTO) began to issue more computer-related patents, pushback from software companies in particular, among others, likely resulted in more judicial scrutiny over the area of computer-implemented inventions.
Complaints against some of the software-related patents issued by the USPTO could be readily understood as some issued patent claims sought to keep others from performing well-known and well-established tasks by merely substituting those tasks with steps performed on a computer.
Unfortunately, the courts have responded to such complaints in a manner that has caused some confusion about what is and is not patentable. Fortunately, case law and USPTO policy have been developed, providing better guidance and hopefully a proper approach to evaluating computer-implemented inventions.
- 35 U.S.C. §101 provides, “Whoever 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, subject to the conditions and requirements of this title.”
As a patent provides rights of exclusion (i.e., the rights “to exclude others from making, using, offering for sale, selling, or importing into the United States the invention claimed in the patent” (see 35 U.S.C. §154(a)(1)), certain judicially created exceptions to the patentability of mental steps, preclusion of the use of mathematical formulas, natural phenomena, and abstract concepts can be readily understood. After all, it would be impractical, if not impossible, to prevent someone from using mental steps that might mirror a patented methodology. A similar statement could be made regarding mathematical algorithms or natural phenomena.
In re Bilski, 545 F. 3d 943, 88 USPQ 2d 1385 (Fed. Cir. 2008), in an en banc decision of the United States Court of Appeals for the Federal Circuit (CAFC), sought to impose a two-part test on patent-eligibility:
- Whether a claim is drawing to a process eligible for a patent; and
- Whether the claimed method or process is tied to a particular machine or apparatus and transforms a particular article into a different thing that meaningfully limits the claim's scope, the transformation not merely being an insignificant extra-solution activity (i.e., amounting to an insignificant activity delivered beyond the solution of the problem provided by the claim).
This has been referred to as the machine-or-transformation test. The CAFC in Bilski rejected a prior test (on determining patent eligibility) involving the determination of whether a claim recites an algorithm and whether that algorithm applies in any manner to physical elements or process steps (the Freeman-Walter Abele test referencing three decisions of the United States Court of Customs and Patent Appeals (a now-defunct court)). Additionally, Bilski rejected the test applied in State Street Bank & Trust Co. v. Signature Financial Group, Inc 149 F.3d 1368 (1988), a case that led to the issuance of many business method patents, and in In re Alappat, 33 F 3d 1526 (Fed Cir. 1994) of whether a method led to a “concrete, useful, and tangible result.
On appeal of the CAFC's Bilski decision to the Supreme Court of the United States, the Court held in Bilski v. Kappos 561 U.S. 593 (2010) that the machine-or-transformation test is a “useful and important clue, an investigative tool, for determining whether some claimed inventions are processes under §101 but that the ‘machine-or-transformation test is not the sole test for deciding whether an invention is a patent-eligible ‘process.''” Id at 3227.
Scrutiny of claims under 35 U.S.C. §101 is now largely guided by the U.S. Supreme Court decision in Alice Corp. Pty. Ltd. V. CLS Bank Int'l, 573 U.S. 208 (2014) as applying concepts in Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U.S. 66 (2012) (the Alice/Mayo test).
The holding in Alice noted the following:
- The Court has long held that § 101, which defines the subject matter eligible for patent protection, contains an implicit exception for "[l]aws of nature, natural phenomena, and abstract ideas." Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589, 133 S.Ct. 2107, 2116, 186 L.Ed.2d 124. In applying the § 101 exception, this Court must distinguish patents that claim the "buildin[g] block[s]" of human ingenuity, which are ineligible for patent protection, from those that integrate the building blocks into something more, see Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U.S. 66, 89, 132 S.Ct. 1289, 1303, 182 L.Ed.2d 321, thereby "transform[ing]" them into a patent-eligible invention, id., at 72, 132 S.Ct., at 1294. Pp. 2354-2355.
According to the Alice/Mayo test in determining 35 U.S.C. §101 eligibility, firstly, a determination is made as to whether the claims at issue are directed to a patent-ineligible abstract idea.
“If so, then the elements of each claim, both individually and as an order combination, are considered to determine whether the additional elements transform the nature of the claim into a patent-eligible application of that abstract idea. This second step is the search for an ‘inventive concept' or some element or combination of elements sufficient to ensure that the claim in practice amounts to ‘significantly more' than a patent on an ineligible concept.” DDR Holdings, LLC v. Holtels.com, L.P., 773 F.3d 1245(FED. Cir. 2014).
The United States Patent and Trademark Office (USPTO) has also provided some guidelines for its examiners to help ensure a consistent and predictable application of the Alice/Mayo test. After establishing (Step 1) that a patent claim pertains to a process, machine, manufacture, or composition of matter, the USPTO has set forth criteria for subject matter eligibility with the following focus:
- Determine whether the patent claim is directed to a judicial exception, i.e., a law of nature, a natural phenomenon (product of nature), or an abstract idea; and
- Determine whether the claim recites additional elements that integrate the judicial exception into a practical application.
- Determine whether the additional elements in the claim amount to significantly more, either individually or in combination, than the judicial exception.
Determination of whether an invention is directed to a judicial exception, such as an abstract idea, can often be problematic. Merely accomplishing steps on a computer, general purpose or otherwise, is not per se abstract and, in fact, involves concrete action. A self-referential table recited in claims on appeal was found to be a specific type of data structure designed to improve the way a computer stores and retrieves data in memory. This was determined not to constitute an abstract idea Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1339 (Fed. Cir. 2016).
As noted in Enfish, LLC at 1337, citing Alice, 134 S.Ct. at 2354, "we tread carefully in construing this exclusionary principle [of laws of nature, natural phenomena, and abstract ideas] lest it swallow all of patent law."
Characterizing claims in one manner or another to determine whether they are abstract was not a historically typical activity in patent law. Doing so now is often problematic and may lead to occurrences where a claim characterized as abstract is, in fact, not abstract. Further, a claim having an additional element (or combination of additional elements) known in the art can still be unconventional or non-routine, as explained in the Manual of Patent Examining Procedure 2106.05(d): Well-Understood, Routine, Conventional Activity. The additional element or a combination of additional elements may provide “significantly more” than a patent on an ineligible concept.
How Gallium Law Can Help
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*The information in this article is not legal advice and should not be relied on. The content of this article is for informational purposes only and is meant as a starting point in your search for answers to your legal questions.