Cooler Heads Prevail in New Interim Guidance on Patent Subject Matter Eligibility

December 19th, 2014

The 2014 Interim Guidance on Patent Subject Matter Eligibility (“Interim Guidance”) was printed in the Federal Register Tuesday [1] (December 16) and “supplements” the Preliminary Examination Instructions in view of the Supreme Court decision in Alice Corp. of June 25, 2014 (“Preliminary Instructions”).[2] The Interim Guidance includes a flowchart that presents the two-part test for Section 101 eligibility in graphical form:

With respect to Step 2A, the Interim Guidance still includes the four categories of abstract ideas identified in the Preliminary Instructions: “fundamental economic practices, certain methods of organizing human activities, an idea ‘of itself,’ and mathematical relationships/formulas.”  However, while the Preliminary Instructions suggested that Part 1 of the two-part test is met by any claim that includes an element that falls into one of these categories, the Interim Guidance provides 17 distinct examples from various cases, allowing for a finer-grained analysis.  Similarly, while the Preliminary Instructions recited five examples relating to Part 2 of the two-part test, the Interim Guidance provides ten.

For six of the 17 abstract idea examples, the Interim Guidance walks through the two-part analysis to show how the decision regarding Section 101 eligibility was reached (or how the decision was consistent with the two-part analysis, for decisions rendered prior to Mayo or Alice).[3] Additionally, fifteen Federal Circuit and Supreme Court case summaries are provided.  The case summaries should help to provide context for practitioners and Examiners, but are unlikely to provide clear direction in any particular application.  Accordingly, future battles over Section 101 rejections may look more like litigation than prosecution, with the applicant arguing that Case X provides the appropriate precedent for analysis of his claims and the Examiner arguing that Case X is distinguishable and Case Y is the relevant case.

In addition to discussing the two-step process, the Interim Guidelines also include a streamlined eligibility analysis for a claim that “when viewed as a whole, clearly does not seek to tie up any judicial exception such that others cannot practice it.”  Four examples are provided of such claims:

  • a robotic arm assembly having a control system that operates using certain mathematical relationships
  • an artificial hip prosthesis coated with a naturally occurring mineral
  • a cellphone with an electrical contact made of gold
  • a plastic chair with wood trim

Unfortunately, the Interim Guidelines do not go into any greater detail as to why these examples “clearly” do not implicate the judicial exceptions.  For example, if the naturally occurring mineral and its properties are natural phenomena, and the artificial hip prosthesis is otherwise known in the art, then why isn’t the hip prosthesis claim merely a field of use limitation for the mineral?  In that case, the hip prosthesis, no matter how complex in its own right, would merely be well-understood and routine, and could not be significantly more than the use of the natural phenomenon.

The Interim Guidelines specify that “if there is doubt … the full analysis should be conducted.”  Accordingly, once an examiner has decided to perform the full analysis, an applicant will have little recourse to argue that the streamlined eligibility analysis should have been used.  Thus, as with the Preliminary Guidelines, examiners retain broad discretion in deciding what the abstract idea is, whether preemption concerns apply, and whether the claim involves significantly more than the abstract idea.

For reference, the examples included in the Interim Guidance for Part 1 and Part 2 of the test are provided below.  The 17 example laws of nature, natural phenomena, and abstract ideas are:

  • isolated DNA – Myriad
  • a correlation that is the consequence of how a compound is metabolized – Mayo
  • electromagnetism to transmit signals – Morse
  • the chemical principle underlying the union between fatty elements and water – Tilghman
  • mitigating settlement risk – Alice
  • hedging – Bilski
  • creating a contractual relationship – buySAFE
  • using an advertisement as currency – Ultramercial
  • processing information through a clearinghouse – Dealertrack
  • comparing new and stored information and using rules to identify options – SmartGene
  • using categories to organize, store, and transmit information – Cyberfone
  • organizing information through mathematical correlations – Digitech
  • managing a game of bingo – Planet Bingo
  • the Arrhenius equation for calculating the cure time of rubber – Diehr
  • a formula for updating alarm limits – Flook
  • a formula relating to standing wave phenomena – Mackay Radio
  • a procedure for converting one form of numerical representation to another – Benson

The six positive examples of what qualifies as “significantly more” than the abstract idea are:

  • improvements to another technology or technical field – Diehr
  • improvements to the functioning of the computer itself – Alice
  • applying the judicial exception with, or by use of, a particular machine – Bilski
  • effecting a transformation or reduction of a particular article to a different state or thing – Diehr, Benson, Tilghman
  • other meaningful limitations beyond generally linking the use of the judicial exception to a particular technological environment – Alice

The four negative examples of what is not “significantly more” are:

  • adding the words “apply it” (or the equivalent) with the judicial exception, or mere instructions to implement an abstract idea on a computer – Alice
  • simply appending well-understood, routine and conventional activities previously known to the industry, specified at a high level of generality, to the judicial exception, e.g., a claim to an abstract idea requiring no more than a generic computer to perform generic computer functions that are well-understood, routine and conventional activities previously known to the industry – Alice, Mayo
  • adding insignificant extrasolution activity to the judicial exception, e.g., mere data gathering in conjunction with a law of nature or abstract idea – Mayo, Flook
  • generally linking the use of the judicial exception to a particular technological environment or field of use – Mayo, Bilski, Flook

My thanks to Domenico Ippolito for this post.

[1] 79 Fed. Reg. 74618-33 (Dec. 16, 2014).

[2] The Interim Guidance also “supersedes” the March 4, 2014 Procedure For Subject Matter Eligibility Analysis Of Claims Reciting Or Involving Laws of Nature / Natural Principles, Natural Phenomena, And / Or Natural Products.  However, that Procedure did not address software inventions, and so is not addressed here.

[3] Four additional cases are also addressed, for a total of 21 case summaries in the Interim Guidance.


Federal Circuit finally meets a software patent it can love: DDR Holdings, LLC v., et al.

December 11th, 2014


Software patent owners that have been underwater holding their breath since the Supreme Court’s Alice Corp. v. CLS Bank decision can finally come up for air.   In DDR Holdings, LLC v., et al.  (13-1505.Opinion.12-3-2014.1),  the Federal Circuit finally found a software patent it could love in spite of the Alice decision.   The DDR Holdings patent involved methods of serving web pages offering commercial opportunities by an “outsource provider.”  The claimed invention provided for more than one unrelated web stores to offer a single product while allowing an “outsource provider” to provide a standard web page format for the product.  In particular, the invention allowed product merchandisers to control the “look and feel” of their products even when offered for sale on unrelated merchant sites.

Representative claim 13 of the ’572 patent recites:

13.  An e-commerce outsourcing system comprising:

a) a data store including a look and feel description

associated with a host web page having a

link correlated with a commerce object; and

b) a computer processor coupled to the data store

and in communication through the Internet

with the host web page and programmed, upon

receiving an indication that the link has been

activated by a visitor computer in Internet

communication with the host web page, to serve

a composite web page to the visitor computer

wit[h] a look and feel based on the look and feel

description in the data store and with content

based on the commerce object associated wit[h]

the link.


The Federal Circuit noted that the claims did “not merely recite the performance of some business practice known from the pre- Internet world along with the requirement to perform it on the Internet. Instead, the claimed solution is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.” Id. (emphasis added).   The Federal Circuit reasoned the Alice did not preclude protection because there were no abstract ideas implemented by the invention, and furthermore that the claims recited a combination of specific, what could be termed “technical” steps.

The claims recently held 101 ineligible in Ultramercial, finding that unlike the claims in Ultramercial, the claims at issue do “not merely the routine or conventional use of the Internet.”  Id. at 22-23.

There are a couple things worth noting about the DDR invention, and this decision:

  1. The point of novelty of this invention is a technical architecture and operation that, while perhaps fulfilling a non-technical business objective of providing the same look and feel across multiple different web sites, is not an abstract “business idea” like an advertising or accounting scheme.
  2. The invention recites a fairly complex (and novel) technical arrangement, in which:
    1. A “data store” contains “look and feel” information;
    2. A “processor” is “programmed” and interacts with the data store to serve a composite web page through the Internet to a “visitor computer” using the look and feel information and “content” based on a “commerce object.”

As I have alluded to in earlier posts, after all is said and done, we now have a “technical” test for software inventions – if the advance over the art is technical in nature, it is likely inside Section 101.  If the advance over the art is non-technical it will not be statutory even if it is wrapped inside a technical shell.  Instead of using the word “abstract idea” in the Alice test, at least as far as software is concerned, just substitute “non-technical idea”, and you will get the same result.  The trick is, however, that the vessel implementing the idea doesn’t count in making this determination.  Here is an example of what I mean.  Let’s say the claimed “invention” is a computer programmed to play a novel musical score, or a robot programmed to dance a novel dance move.

In either example, let’s assume for the sake of argument the music and score are novel and non-obvious.  Would we expect these “inventions” to be patentable?  I would say history tells us no, as I am not aware of any patents issued on inventions where the point of novelty is a musical idea.  So, in this case, even though the computer “vessel” is most definitely a machine, what is new is actually a work of authorship that we would all agree is not patentable.  In this way we can see that merely reciting a computer in a claim does not mean that “machine” should, as a matter of policy, be automatically statutory.  Accordingly, if we accept that not all computers programmed to behave in a novel manner are 101 statutory, and that not all novel ideas are patentable just because they are machine-implemented (for example neither music nor choreography), we can open ourselves to the possibility that certain other types of innovation, like non-technical ideas, even though computer implemented, are not necessarily patent eligible.  For example, the Federal Circuit appears to have viewed the invention as a whole in Ultramercial v. Hulu (November 2014), as a non-technical, content monetization concept as opposed to a technical innovation inside the perimeter of the useful arts.  Of course, it is possible for innovation to encompass both non-technical and technical ideas simultaneously, some would argue that Ultramercial was such a case, tipping it inside 101.

Another point of confusion in Alice and its progeny is the mixing of obviousness requirements into Section 101.  I would submit that the Court did not really conflate these two requirements.  What the Court was really doing can be understood with reference to my example given above.  Let’s assume again that the the “invention as a whole” is a musical score, and that this score is claimed as a computer programmed to “play” the score using a straight forward technical approach with nothing new about it.  Here, the hypothetical tells us that the way the computer is programmed is not novel in and of itself, only the music is novel.  But normally this is not a given, requiring an inquiry into whether there is a technical contribution of some kind.  It is not so much an inquiry as to the obviousness of the technical contribution as it is whether or not the asserted innovation lies in the technical domain as opposed to a non-technical domain.  If the technical component appears to be a routine implementation of the non-technical component of the innovation, then the conclusion is that the invention as a whole contains no patent eligible subject matter.  Clearly this can get confusing to sort out, and particularly where the applicant or patentee would prefer to conflate any non-technical innovation with the technical implementation.

In essence, what the Court did in Alice was say that once the abstract idea was stripped out, the technical component remaining was routine engineering bereft of any inventive content.  Unfortunately, the patentee may beg to differ on that point in most cases.


Card Verification v. Citigroup: Software Patent Survives 12(b)(6) Abstract Idea Attack

October 8th, 2014

This decision provides a bit of hope for software patents at least in getting through a 12(b)(6) motion, it will be interesting to keep track of this case as it progresses.  There is nothing particularly remarkable about the claims (in fact it seems like much less abstract claims have gone down in other cases).   Card Verification v. Citigroup ilnd-1-13-cv-06339-50-Claims up held at 12(b)(6)

It is very interesting that this Court choose to give the patent owner a very favorable construction around the “tokens” as there is nothing in the claim that would require these to be interpreted as being “four-digit pseudorandom strings of numbers and characters.”

Summary of Court’s Analysis:

Claims are directed to the abstract idea of “verifying a transaction.”

(Commentary: fairly board and reasonable identification of an abstract idea that the claims do embody.)

The Court continues by analogizing the present claims to the credit card verification claims in CyberSource, and states that the claims involve a fundamental economic practice long prevalent in our system of commerce.

The Court then moves to the 2nd Step of the Mayo/Alice analysis – is there something more sufficient to transform the unpatentable abstract idea?

The Court expressly finds “a review of the diagrams demonstrates incorporation of a computer, nonsecure network, and pseudorandom tag generating software. A plausible interpretation of the patent is that computing devices, software, keyboards, and credit card readers would be required to use the invention.”

(Commentary: This seems like a very favorable read for the patent owner, probably due to the nature of the motion at issue (12(b)(6) motion on the pleadings))

The Court essentially predicates their decision on an interpretation of the claims that includes “a limitation requiring pseudorandom tag generating software that could not be done with pen and paper.”

(Commentary: This “limitation” is not literally recited in the independent claims.  Without this favorable interpretation the reminder of the Court’s analysis falls apart.)

Here is to hoping this analysis is were things are heading–it would not to severely limit the claims at issue to literally recite the limitation read into the claims by the court.  Accordingly, this decision provides some ground to stand on for software patents.

My thanks to Greg Stark of Schwegman, Lundberg & Woessner, PA, for this post.

Planet Bingo, LLC v. VKGS LLC: Bingo invention fails abstract idea test

September 4th, 2014

In Planet Bingo, LLC v. VKGS LLC, 2013-1663 (Fed. Cir. Aug. 26, 2014) (nonprecedential), the Federal Circuit upheld a § 101 invalidity finding on summary judgment by the court below.  The opinion is brief, spending only three paragraphs on the determination that the claims are “directed to an abstract idea” and an additional five on the determination that “the claims at issue do not have an ‘inventive concept’ sufficient to ‘transform’ the claimed subject matter into a patent-eligible application.”

Unfortunately for the patentee, all briefs in the case were filed before the Supreme Court’s decision in Alice Corp. v. CLS Bank International, No. 13-298 (U.S. June 19, 2014) was decided.  Accordingly, when the Federal Circuit applied the two-step process defined by the Supreme Court in Alice, it did so without direct input from the parties.  As a result, the opinion does not provide a thorough consideration of all relevant elements.  Nonetheless, the Federal Circuit opinion is an affirmance of the lower court’s decision, and so a review of the more detailed analysis presented there may be helpful in understanding the Federal Circuit’s position.

The approach taken by Judge Bell of the Western District of Michigan was, if anything, more exhaustive than the two steps identified by the Supreme Court in Alice.  To refresh, those steps were (1) determining if “[t]he claims at issue are directed to a patent-ineligible concept” such as an “abstract idea” and (2) if so, determining if the claims “transform that abstract idea into a patent-eligible invention” by supplying an “inventive concept.”  To frame the discussion, an example claim is below.

7. A method for playing a game of Bingo which comprises the steps of:

(a) providing a system for managing a game of Bingo which comprises:

a computer with a central processing unit (CPU) and with a memory and with a printer connected to the CPU;

an input and output terminal connected to the CPU and memory of the computer; and

a program in the computer enabling:

(i) input of at least two sets of Bingo numbers which are preselected by a player for repetitive play in games of Bingo over a period of time;

(ii) storage of the sets of Bingo numbers which are preselected by the player as a group in the memory of the computer;

(iii) assignment of a player identifier unique to the player for the group having the sets of Bingo numbers which are preselected by the player wherein the player identifier is assigned to the group for multiple sessions of Bingo;

(iv) retrieval of the group using the player identifier;

(v) selection from the group by the player of at least one of the sets of Bingo numbers preselected by the player and stored in the memory of the computer as the group for play in a selected game of Bingo in a specific session of Bingo wherein a number of sets of Bingo numbers selected for play in the selected game of Bingo is less than a total number of sets of Bingo numbers in the group;

(vi) addition by the computer of a control number for the set of Bingo numbers which is selected by the player for play in the selected game of Bingo;

(vii) output of a receipt with the control number, the set of Bingo numbers which is selected for play in the selected game of Bingo, a price for the set of Bingo numbers which is selected for play in the selected game of Bingo, a date of the selected game of Bingo and optionally a computer identification number; and

(viii) output for verification of a winning set of Bingo numbers by means of the control number which is input into the computer by a manager of the game of Bingo;

(b) playing the game of Bingo using the set of Bingo numbers wherein the player signals a Bingo to indicate the set of Bingo numbers which is selected for play in the selected game of Bingo is the winning set of Bingo numbers; and

(c) verifying the winning set of Bingo numbers with the control number with the program.

Returning to the Alice analysis: (1) Are the claims directed to an abstract idea?

The district court determined that the claims “encompass[] the abstract idea of managing/playing the game of Bingo.”  File No. 1:12-CV-219 (W.D. Mi. Dkt. 73).  This determination was made with reference only to the claims themselves.  Citing to Cybersource Corp. v. Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. 2011), the court noted that processes that “consist[] solely of mental steps which can be carried out by a human using pen and paper … [are] not patentable.”  At this stage, the court appears to be applying the “mental steps” test to the identified abstract idea, not to the claim itself.  While no court has yet provided a clear explanation of how to define the abstract idea encompassed by a claim, this suggests that one reasonable method of doing so is to identify the portion of the claim that consists solely of mental steps.

(2) Do the claims supply an inventive concept that transforms that abstract idea into patent-eligible subject matter?

The district court held that the additional limitations “provide only for the use of a computer performing its most basic functions: storing numbers, assigning identifiers, allowing for basic inputs and outputs, printing of a receipt, displaying of numbers, and/or matching a player’s numbers with the called numbers for verification.”  Accordingly, the claims failed this prong as well.

The question this raises is: How do the courts distinguish the patent-eligible process discussed in Diamond v. Diehr, 450 U.S. 175 (1981) from the patent-ineligible processes of Alice and Planet Bingo?  In Diehr itself, the Court held that even though the Arrhenius equation was known, and using molds to cure rubber was known, a process that used a computer to recalculate the Arrhenius equation and adjust the cure time was patent-eligible.  The basis for this was the improvement of “constantly measuring the actual temperature inside the mold.”  In Alice, the Court revisited Diehr and declared that the claims had been found patent-eligible because it “used a ‘thermocouple’ to record constant temperature measurements inside the rubber mold – something ‘the industry ha[d] not been able to obtain.”  Accordingly the distinction appears to be that in Diehr a hardware element that was not routinely connected to computers was used to enable the process while in Alice and Planet Bingo the computer is used for its ordinary purposes.  Given that thermocouples (which, it should be noted, are not actually recited in the claims) were well-known in the art even at the time of Diehr, and given that using a computer for its ordinary purposes is not sufficient to confer patent-eligibility, it is unclear why using a thermocouple (or other thermometer) for its ordinary purpose of measuring temperature should convert an otherwise ineligible method into an eligible one.

One is left wondering if the difference is simply that the final step of Diehr was curing rubber, and so was an innovation that was useful to an existing, traditional industry, while the systems of Alice and Planet Bingo are innovations that relate to finance and gambling, and so are somehow deemed less worthy of patent protection.  If true, this bias finds no support in statutory law, and without explicit admission from the courts that this is the case, even legislative remedies are difficult to pursue.

My thanks to Domenico Ippolito for this posting.

Recent Grants in Electronic Commerce Technology Group Provide Evidence that At Least “Technical Inventions” Still Pass Muster Under Alice

August 15th, 2014

In a recent post Dennis Crouch has provided two charts showing the grant rate of patents filed between 2003 and 2010, divided by technology area.  See and  These charts show that technology area 3620 – Electronic Commerce – has a relatively low allowance rate of about 35%.  However, this area also has the highest rate of still-pending applications, at about 23%.  The high rate of still-pending applications suggests either that, relative to the applications in the sample, the electronic commerce applications were filed later in the sampling period, or that the electronic commerce applications are, on average, taking longer to prosecute to completion (either allowance or abandonment).  Unfortunately, without more detail, these charts do little to explain why electronic commerce applications are taking longer to prosecute (if they are) or why electronic commerce applications are facing a below-average allowance rate.  One possible explanation for the low allowance rate is the additional § 101 hurdles presented by Bilski and Alice, in particular the calling-out in Alice of a “fundamental economic practice” as an abstract idea.

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Experian Marketing Solutions, Inc. v. RPost Communications Ltd. – PTAB finds electronic messaging a “technological invention” outside ambit of Covered Business Method review

July 17th, 2014

In Experian Marketing Solutions, Inc. v. RPost Communications Ltd., Case CBM2014-00010 (June 19, 2014), the Patent Trial and Appeal Board denied a request for covered business method patent review even though it found that the patent included claims for “performing data processing or other operations used in the practice, administration, or management of a financial product or service.”  Experian petition ExperianMktgSolutions_v_RPostCommLtd_CBM2014-0010

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Digitech Image Technologies, LLC v. Electronics For Imaging, Inc. — Data structures per se not patentable

July 17th, 2014

In Digitech Image Technologies, LLC v. Electronics For Imaging, Inc., Case No. 13-1600 (Fed. Cir. July 14, 2014), the Federal Circuit affirmed a district court decision invalidating all claims of Digitech’s patent (U.S. Patent No. 6,128,415).  In making its decision, the court considered three independent claims of the ‘415 patent.

Independent claim 1 recites “A device profile … comprising … first data … and second data ….”  Similarly, independent claim 26 recites “A device profile … comprising data ….”  The claims do not recite any storage media holding the device profiles, but are entirely directed to the profiles themselves.  These claims appear on their face to be directed to data structures per se, and the Federal Circuit so held, finding that claims 1 and 26 are “directed to information in its non-tangible form.”[1] Notably, the application that led to the ‘415 patent was filed on September 6, 1996, but In re Warmerdam, 33 F.3d 1354 (Fed. Cir. 1994) had already established that a “data structure” “is not one of the categories of subject matter recited in Sec. 101.”  Thus, the rejection of this claim is based on case law from 1994, and does not reflect a post-Alice change.

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Drafting Software Patent Applications to Meet Section 101 after the Alice Decision

June 25th, 2014

My thanks to Peter Leal of Schwegman, Lundberg & Woessner, P.A., for this guest post:

In Alice Corporation PTY. Ltd. v. CLS Bank International, et al, handed down on June 19, 2014,  the U.S. Supreme Court held the Alice claims invalid under 35 U.S.C. § 101, using the two-step test for determining patent statutory subject matter set forth in the Court’s 2012 decision, Mayo Collaborative Ser­vices v. Prometheus Laboratories, Inc., 566 U. S. ___, ___.  One first determines whether the claim recites non-statutory subject matter such as an abstract idea.  If it does, then one “determines whether it contains an ‘inventive concept’ sufficient to ‘transform’ the claimed abstract idea into a patent-eligible application.”

In applying the second step to the method claims in Alice, the Court stated:

Viewed as a whole, these method claims simply recite the concept of intermediated settlement as performed by a generic computer.  They do not, for example, purport to improve the function­ing of the computer itself or effect an improvement in any other tech­nology or technical field. An instruction to apply the abstract idea of intermediated settlement using some unspecified, generic computer is not “enough” to transform the abstract idea into a patent-eligible invention.

Many software patent applications include a flowchart of the inventive concept and a block diagram of a computer system.  Several pages of detail describing the computer system are often included in the written description.  Claims are then directed to the inventive concept outlined in the flowchart as an operation of the disclosed computer system.  Software applications so drafted and claimed appear to be considerably more than the “unspecified, generic computer” in the above quotation from Alice.  However, one cannot be certain of the validity of patents issuing on this type of patent application until one of the patents is ultimately litigated.  A large number of patents may depend on that ultimate litigation.

Additional disclosure to that outlined above may help insure that claims directed to software meet section 101 after Alice.  One view of computer software patents is that the above flowchart amounts to an improvement in the function of the disclosed general purpose computer.  Consequently the patent application drafter might consider also including in software patent applications an additional figure of hardware logic design that discloses a hardware implementation of the flowchart.

On June 25, 2014 the USPTO issued “Preliminary Examination Instructions in view of the Supreme Court Decision in Alice Corporation PTY. Ltd. v. CLS Bank International, et al (the “Instructions”).”  In addressing the above second step, the Instructions state:

If an abstract idea is present in the claim, determine whether any element, or combination of elements, in the claim is sufficient to ensure that the claim amounts to significantly more than the abstract idea itself.  In other words, are there other limitations in the claim that show a patent-eligible application of the abstract idea, e.g., more than a mere instruction to apply the abstract idea?  Consider the claim as a whole by considering all claim elements, both individually and in combination.

Limitations referenced in Alice Corp. that may be enough to qualify as “significantly more” when recited in a claim with an abstract idea include, as non-limiting or non-exclusive examples:

  • Improvements to another technology or technical fields;
  • Improvements to the functioning of the computer itself;
    • Meaningful limitations beyond generally linking the use of an abstract idea to a particular technological environment

The hardware logic design figure suggested above may be viewed as a limitation that qualifies as “significantly more” since it is an “improvement[s] to the functioning of the computer itself” as in the above quotation from the Instructions.

Moreover, the current law allows patent applicants to claim the operation of an apparatus as a method.  Method claims drawn to the suggested hardware figure should be given breadth to cover a general purpose computer programmed to operate as the hardware logic diagram.  The Beauregard and system claims should likewise be given similar breadth.




Alice v. CLS Bank: Supreme Court Continues to Grope in Dark for Contours of Abstract Idea Exception

June 19th, 2014

In Alice Corp. v. CLS Bank Int’l (2014), the Supreme Court unanimously affirmed the one-paragraph per curium opinion of the en banc Federal Circuit, which found all claims of U.S. Patent Nos. 5,970,479, 6,912,510, 7,149,720, and 7,725,375 invalid under 35 U.S.C. § 101 for being directed to an abstract idea.

The Court based its affirmance on an application of a two-step process outlined in Mayo Collaborative Services v. Prometheus Labs, 566 U.S. ___ (2012). The first step is the determination of whether the claims are directed to a patent-ineligible concept such as a law of nature, natural phenomenon, or abstract idea. This step implicitly includes the identification of the concept at issue. The second step is to determine if the claims recite “an element or combination of elements that is sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself.”

The Court avoided providing “the precise contours of the ‘abstract ideas’ category” by relying on the similarity between Alice’s claims for intermediated settlement and Bilski’s claims for hedging. The Court characterized the Bilski claims as “a method of organizing human activity.” Accordingly, while only three justices signed Justice Sotomayor’s concurrence, stating that “any claim that merely describes a method of doing business does not qualify as a ‘process’ under §101,” the unanimous decision does implicate business methods as likely directed to abstract ideas.
At the Federal Circuit, the splintered opinion included a four-judge dissent that argued that the system claims should be patent-eligible even though the method claims were not. The Supreme Court disagreed with this view, finding that if the system claims were treated differently under §101, “an applicant could claim any principle of the physical or social sciences by reciting a computer system configured to implement the relevant concept” which would “make the determination of patent eligibility depend simply on the draftsman’s art.” To convey patent-eligibility, the claims at issue must be “significantly more than an instruction to apply the abstract idea … using some unspecified, generic computer.”

In my previous post regarding the oral argument before the Supreme Court, I noted that the Court seemed to be looking for reasonable and clear rules regarding the limits of the abstract idea exception to patentable subject matter, but did not get such a rule from any party. Perhaps as a result, this case was decided purely on its similarity to Bilski, and without providing much guidance as to the scope of the exception.

My thanks to Domenico Ippolito for this posting.

Congratulations to the USPTO’s New Regional Director Russ Slifer

June 16th, 2014

My congratulations to Russ Slifer, the new Regional Director of the USPTO’s Denver office.  I have known Russ since he started his career in patent law in 1994 at the Schwegman firm, and followed his career through his private practice representing several of America’s top high technology companies, to his many years as Chief Patent Counsel for Micron.  The USPTO is fortunate to have gained Russ for their leadership team.  He has always demonstrated a mastery of his craft, is amazingly productive, shows sound judgement in all his affairs, is a progressive manager, and has been a leader in every aspect of his professional life.  No doubt he will provide Michelle Lee and the USPTO a strong leader for the Denver office, continue to help the Office evolve and adapt to the ever changing needs of industry and policy, and get things done.  Once again, my congratulations to Russ and the USPTO.