United States: USPTO Updates Guidance On Subject Matter Eligibility

[For background, see our prior posts on July 2, 2014, August 5, 2014, December 18, 2014, and March 23, 2015.]

On July 30, 2015, the United States Patent & Trademark Office (USPTO) published an update to its 2014 Interim Guidance on Subject Matter Eligibility (2014 IEG) published on December 16, 2014.1 Comments to the 2014 IEG were solicited from the public, and the update purports to respond to six major themes from the public comments, including

  • requests for additional examples, particularly for claims directed to abstract ideas and laws of nature;
  • further explanation of the markedly different characteristics (MDC) analysis;
  • further information regarding how examiners identify abstract ideas;
  • discussion of the prima facie case and the role of evidence with respect to eligibility rejections;
  • information regarding application of the 2014 IEG in the examiner corps; and
  • explanation of the role of preemption in the eligibility analysis, including a discussion of the streamlined analysis.

The Quick Reference Sheet summarizes the Office's views on the prima facie case requirement, and the requirements for identifying abstract ideas in Step 2A of the Alice analysis.

Prima Facie Case and the Requirement for Evidence

A so-called prima facie case of ineligibility requires the examiner to explain clearly and specifically why a claim or claims are unpatentable, so that the applicant has sufficient notice and is able to effectively respond. According to the Office, the examiner's burden is met by "clearly articulating the reason(s) why the claimed invention is not eligible, for example by providing a reasoned rationale that identifies the judicial exception recited in the claim and why it is considered an exception, and that identifies the additional elements in the claim (if any) and explains why they do not amount to significantly more than the exception." Sample rejections satisfying the "clear articulation" burden are provided in the training materials, particularly the Worksheets for Examples 5‐8.

Perhaps the most controversial aspect of the updated guidelines is the Office's decision that evidence is not needed as a prerequisite to an eligibility rejection. In Section IV, titled "Requirements of a Prima Facie Case," the Office states that courts consider the determination of whether a claim is eligible to be a question of law. The Office asserts that the ultimate legal conclusion on eligibility can be made without making any factual findings, and that courts "have not identified a situation in which evidence was required to support a finding that the additional elements were well‐understood, routine or conventional, but rather treat the issue as a matter appropriate for judicial notice". As such, a rejection under the abstract idea exception can be made if an examiner, relying on his or her expertise in the art, can readily conclude in the Step 2B inquiry that the additional elements do not amount to significantly.

Note: The updated guidance does not seem to address the issue of whether it is appropriate for an examiner to make a blanket rejection of all claims with a specific analysis of only one independent claim.

Identifying Abstract Ideas in Step 2A

Section III of the July 2015 Update provides further information on identifying abstract ideas. This information associates concepts held to be abstract ideas in Supreme Court and Federal Circuit eligibility decisions with "judicial descriptors" based on common characteristics. According to the Office, this information is intended to guide examiners and to "ensure that a claimed concept is not identified as an abstract idea unless it is similar to at least one concept that the courts have identified as an abstract idea."

Here, the Office appears to be instructing examiners not to be creative when examining claims for abstract ideas. Since the courts have not provided a clear definition or description of what a patent-ineligible abstract idea is, the Office is instructing examiners to only find an abstract idea when the claimed concept parallels one found to be abstract in a court decision. It should also be noted the court decisions to be followed are primarily those of the Federal Circuit or Supreme Court rather than district courts.

The so-called judicial descriptors include the following:

  • "Fundamental Economic Practices"
    • "Concepts relating to the economy and commerce, such as agreements between people in the form of contracts, legal obligations, and business relations"
  • "An Idea 'Of Itself'"
    • "An idea standing alone such as an unsubstantiated concept, plan or scheme, as well as a mental process (thinking) that 'can be performed in the human mind, or by a human using a pen and paper'"
  • "Certain Methods of Organizing Human Activity"
    • "Concepts relating to interpersonal and intrapersonal activities, such as managing relationships or transactions between people, social activities, and human behavior; satisfying or avoiding a legal obligation; advertising, marketing, and sales activities or behaviors; and managing human mental activity"
  • "Mathematical Relationships/Formulas"
    • "Mathematical concepts such as mathematical algorithms, mathematical relationships, mathematical formulas, and calculations"

As I study the update examples and analysis, I will provide further commentary as appropriate. For now, I maintain the following views:

For companies with software-related innovations, this question remains: "Should we seek patent protection?" As a practical matter, this question can be answered only on a case-by-case basis. At a high level, applicants should consider whether the invention can be described in such a way as to avoid the characterization that it is no more than an "abstract idea," or whether it can be described as including an "inventive concept sufficient to transform the abstract idea into a patent-eligible application." These are inherently vague concepts that require careful patent drafting in view of the relevant case law. For example, a category of software that clearly remains patent-eligible is software that improves the operation of a computer itself — e.g., software that improves the speed or security of a computer. If the invention can be described in this way, patent eligibility under §101 should not be a significant barrier to obtaining patent protection.

On the other hand, the USPTO continues to reject business method patent applications. This may change over time and as case law is further developed. For now, it may be best for applicants to delay prosecution on the merits by filing provisional patent applications directed to inventions in the "business method" area. A provisional application can provide the company with a cost-effective way to keep its options open as the law in this area develops.

Other strategies to consider when developing a company's patent portfolio include bringing already issued patents into compliance with the more recent guidelines via a reissue application. See Addressing Section 101 Issues Through Reissue and Don't Miss the Window for Post-Grant Review: Monitor Your Competitors by Creating Alert Systems.

Footnotes

1 The new materials posted on the USPTO website include the following:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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