Following on the recent U.S. Supreme Court (the Court) decision
in Alice v. CLS Bank (Alice), the U.S. Patent and
Trademark Office (PTO) issued preliminary instructions (PTO
Guidance) that use a two-part analysis for determining
patent-eligible subject matter to its examiners.
Framework for Determining Patentability
In Alice, the Court found that patent
claims—which were directed to facilitating the exchange of
financial obligations between parties using a computer system as an
intermediary to reduce settlement risk—were too abstract to
be patent eligible. In reaching its finding, the Court adopted the
two-part framework that was used in an earlier decision in Mayo
v. Prometheus to distinguish ineligible patents from eligible
ones. The first part of the framework provides that a claim should
be analyzed to determine if it is directed to one of the
patent-ineligible exceptions (i.e., if the claim is directed to a
law of nature, a natural phenomenon or an abstract idea)—and
if it is, then part two of the framework is engaged. In part two of
the analysis, the elements of the claim are considered individually
and "as an ordered combination" to determine if the
additional elements "transform the nature of the claim"
into a patent-eligible application.
Alice and the PTO Guidance gave a number of examples of
what would generally be seen as abstract ideas under part one of
the Mayo framework, including fundamental economic
practices, methods of organizing human activities, an idea in and
of itself, and mathematical relationships and formulas. If an
abstract idea is determined to be present in a claim, part two of
the analysis provides for determining if a claimed element or
combination of elements is sufficient "to ensure that the
claim amounts to significantly more than the abstract idea
itself." In this respect, Alice and PTO Guidance urge
consideration of whether a claim provides more than mere
instruction to apply an abstract idea.
The PTO Guidance provides examples of elements of a claim that
may qualify as "significantly more" than an abstract
idea, including improvements to another technology or technical
field, improvements to the functioning of a computer itself, and
"meaningful limitations" beyond generally linking the use
of an abstract idea to a particular technological environment. In
the latter respect, the PTO Guidance goes on to note that a claim
directed at a generic computer performing generic computer
functions within the parameters of well-understood, routine and
conventional activities will generally not qualify as being
"significantly more" than an abstract idea.
In Alice, the Court found the patent at issue was
directed to the abstract idea of intermediated settlement to reduce
settlement risk, and went on to conclude that the use of a
general-purpose computer implemented to reduce settlement risk did
not quality as "significantly more" than an abstract
idea, and as such held the claims in Alice patent
No Categorical Exclusions to Patentability
While a minority of justices on the Court would have further
held that business method claims are not patent eligible, this view
was not shared by the majority of the Court. Despite the
Court's extensive commentary explaining that limitations to a
generic computer does not add to patentability, the PTO Guidance
itself notes that Alice neither created any excluded
category of subject matter, such as software or business methods,
nor imposed any special requirements for eligibility of software or
business methods.The PTO Guidance accepts Alice as
authority that the Mayo framework for analyzing patent
eligibility should be used for all types of claims (e.g., product,
system or process claims) and all types of exceptions to
patentability (e.g., laws of nature, natural phenomena and abstract
ideas). Ultimately, and in spite of limited guidance around what
qualifies as "significantly more than an abstract idea"
to meet patent eligibility requirements, it would seem that the
Court and PTO are both prepared to continue to accept that software
and other computer-implemented innovations are patentable.
The Federal Court dismissed a motion by Apotex seeking particulars from Allergan's pleading relating to the prior art, inventive concept, promised utility and sound prediction of utility of the patents at issue.
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