On August 4, 2025, the Deputy Commissioner of Patents, Charles Kim, sent a memorandum (hereinafter "August 4 Memo") to the examining corps1 regarding the USPTO's subject matter eligibility guidance. The August 4 Memo includes several important reminders pertaining to examining software-related inventions as articulated in the Manual of Patent Examining Procedure (MPEP) and other USPTO guidance. In particular, the August 4 Memo provides guidance on the following topics that arise when examiners assess Step 2A of the USPTO's subject matter eligibility analysis: (a) reliance on the mental process grouping of abstract ideas; (b) distinguishing claims that "recite" a judicial exception from claims that merely "involve" a judicial exception; (c) analysis of the claim as a whole; and (d) consideration of whether a claim is directed to an improvement in the functioning of a computer or "any other technology or technical field," or whether a computer is merely being used as a tool to perform the recited abstract idea (i.e., "apply it"). In addition, the August 4 Memo includes a discussion of when a subject matter eligibility rejection should be made.
In our view, the August 4 Memo highlights several important issues that routinely confront patent professionals when prosecuting software-related applications.
First, the August 4 Memo reminds patent examiners that "if it is a 'close call' as to whether a claim is eligible, they should only make a rejection when it is more likely than not (i.e., more than 50%) that the claim is ineligible under 35 U.S.C. 101" (emphasis added). MPEP § 2106's treatment of subject matter eligibility doesn't mention a "preponderance of the evidence" standard for establishing patent eligibility. Instead, that section is found in MPEP § 706(I), which states "[t]he standard to be applied in all cases is the 'preponderance of the evidence' test" (emphasis added). Our experience with many examiners is that the § 101 analysis is interpreted as a question of extremes. One type of invention is always considered patent eligible (e.g., incorporating drilling of a well into a data processing invention), while another type of invention is never found patent eligible (e.g., data processing with no specialized hardware except a computer). As the Federal Circuit recognized in Bascom,2 many inventions under § 101 are "close calls" that involve weighing pro-patent and anti-patent arguments to determine whether a claimed invention is eligible for patenting. In contrast, some patent examiners merely determine the "gist" of a claim prior to finding a claim is ineligible for patenting.
Second, the August 4 Memo indicates the importance of considering "a claim as a whole" for Step 2A Prong Two of the USPTO's Subject Matter Eligibility Test. More specifically, the August 4 Memo describes this consideration as analyzing "[t]he way in which the additional elements use or interact with the [judicial] exception may integrate the judicial exception into a practical application" such that "the additional limitations should not be evaluated in a vacuum, completely separate from the recited judicial exception" (emphasis added). In practice, many patent examiners only analyze the "additional elements" in a vacuum under Steps 2A and 2B of the USPTO's subject matter eligibility test. The current operating procedure for many examiners is to include as many claim limitations as possible in the alleged abstract idea (i.e., all software limitations). Afterwards, by only having one or two additional limitations remaining, the examiner's task becomes easy to find that the claims are directed to an abstract idea and thus patent ineligible.
Third, the August 4 Memo reiterates the actual requirements for finding patent eligibility under the "improvement consideration." More specifically, the August 4 Memo states that "[a]n important consideration in determining whether a claim improves technology or a technical field is the extent to which the claim [1] covers a particular solution to a problem or [2] a particular way to achieve a desired outcome, as opposed to merely claiming the idea of a solution or outcome." While this consideration is already found in MPEP §§ 2106.05(a) and 2106.05(f), the August 4 Memo reemphasizes that an advantageous technological outcome (i.e., the "desired outcome") accomplished in "a particular way" is patent eligible. Typically, patent examiners require the "improvement consideration" to include an articulation in the specification of a clearly identified technological problem in view of specific prior art. However, such identified technological problems are rarely found when preparing patent applications. On the other hand, advantageous technological outcomes are more commonly described in patent specifications. Thus, this alternative strategy for arguing the improvement consideration is a valuable tool for patent professionals advocating patent eligibility going forward.
Fourth, the August 4 Memo settles a USPTO debate whether Example 39 ("Method for Training a Neural Network for Facial Detection") dated January 7, 2019, remains applicable for analyzing machine learning inventions. For reference, many examiners and patent professionals found that Example 39 was effectively overruled by the USPTO's "2024 Patent Subject Matter Eligibility Guidance Update Including on Artificial Intelligence" dated July 17, 2024. The August 4 Memo asserts that Example 39 illustrates claim limitations that "merely involve" an abstract idea, while similar claims in Example 47 ("Anomaly Detection") show limitations that explicitly recite an abstract idea. Additionally, the August 4 Memo states that claim 2 of Example 47 "requires specific mathematical calculations by referring to the mathematical calculations by name, i.e., a backpropagation algorithm and a gradient descent algorithm, and therefore recites . . . an abstract idea" in contrast to the example claim in Example 39.
Finally, the August 4 Memo provides many more valuable insights into analyzing claims for patent eligibility under USPTO practice and current U.S. case law. While the August 4 Memo primarily reiterates considerations already found in MPEP § 2106, the Memo provides an excellent summary of key points for both examiners and patent professionals when properly analyzing claims under § 101.
Footnotes
1. The Deputy Commission directed the August 4 Memo at art units in technology centers 2100, 2600, and 3600. While singling out examiners in these art units, these reminders for software-related inventions are also applicable to patent examination in technology centers 2400, 2800, and 3700 as well.
2. Bascom Global Internet Services v. AT&T Mobility, 827 F. 3d 1341 (Fed. Cir. 2016).
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.
