New subject-matter eligibility guidance issued by the United States Patent and Trademark Office (USPTO) has complicated the question of what inventions qualify for patenting under 35 USC 101. The 2019 Revised Patent Subject Matter Eligibility Guidance, 84 FR 50 (2019 Guidance), is not binding on the federal courts that review patent decisions, and recent decisions by the U.S. Court of Appeals for the Federal Circuit show that application of the 2019 Guidance and judicial review can produce different outcomes.
The Statute and Its Interpretation
All patent applicants must establish that their inventions are eligible for a patent under 35 USC 101, which provides that “[w]hoever 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….” The Supreme Court has long interpreted this provision as excluding laws of nature, natural phenomena, and abstract ideas (the so-called “judicial exceptions”).
The 2019 Guidance further clarifies that abstract ideas are generally limited to (i) mathematical concepts, (ii) certain methods of organizing human activity, or (iii) mental processes (the so-called “enumerated groupings”), and notes that only in rare circumstances would an abstract idea not fall within the enumerated groupings.
The USPTO provided a July 2015 Interim Eligibility Guidance, 80 FR 45429 (2015 Reference), and an updated July 2018: Eligibility Quick Reference Sheet Identifying Abstract Ideas (Quick Reference). The Quick Reference added case names to the four groupings provided within the 2015 Reference. It is a compact reference to court decisions for comparison. This Quick Reference is expressly superseded by the 2019 Guidance.
In the shift to the 2019 Guidance, the four groups of the Quick Reference are filtered to three enumerated groupings. Specifically, the groups of “Fundamental Economic Practices” and “an idea ‘of itself’” are combined into the group of “mental processes.” The 2019 Guidance states that “Claims that do not recite matter that falls within these enumerated groupings of abstract ideas should not be treated as reciting abstract ideas, except … in rare circumstances in which a USPTO employee believes a claim limitation that does not fall within the enumerated groupings of abstract ideas should nonetheless be treated as reciting an abstract idea ….” Given the lack of additional information about what amounts to a “rare situation,” such rare situations cannot be factored into a general assessment of subject matter eligibility. In effect, the 2019 Guidance narrows the scope of abstract ideas set forth in the 2016 Guidance.
The Judicial Response
The Federal Circuit, however, does not seem inclined to follow the new directive. As it said this month in Cleveland Clinic Foundation v. True Health Diagnostics LLC, 2019 BL 113930, “While we greatly respect the PTO’s expertise on all matters relating to patentability, including patent eligibility, we are not bound by its guidance.”
And in another recent case, while the Federal Circuit made no explicit mention of USPTO guidance, it went its own way on the Section 101 issue. ChargePoint, Inc. v. SemaConnect, Inc., 2019 U.S.P.Q.2d 108512.
The ChargePoint and Cleveland Clinic decisions both affirmed district court invalidations of patents that had passed USPTO scrutiny under 35 USC 101. The court of appeals analyzed similar cases to identify previously excluded subject matter, considered whether the claims preempted all practical applications of a concept, and determined whether the claim limitations provided “significantly more” than the ineligible concept. The reasoning of the courts and the USPTO divided on the issue of judicial exceptions.
Preemption of Practical Applications: ChargePoint
The ChargePoint patents recite a charge transfer apparatus connected to a server through a network. It would not seem that an “apparatus” could easily be called a law of nature, a natural phenomenon, a mathematical concept, a method of organizing human activity, or a mental process; accordingly, under the 2019 Guidance, the recited claims would appear to fall outside the judicial exceptions and not be ineligible on that ground.
The judiciary, however, found the claims to be preemptive. The Federal Circuit concluded that the focus of the claims was on the abstract idea, rather than on any apparatus. As the court put it, “the inventors here had the good idea to add networking capabilities to existing charging stations to facilitate various business interactions. But that is where they stopped, and that is all they patented.”
Law of Nature: Cleveland Clinic
The Cleveland Clinic patents disclose “diagnostic test[s] which can be used to determine whether an individual … is at a lower risk or higher risk of developing or having cardiovascular disease.” It seems reasonable to consider this as directed to a law of nature, and therefore not patentable; however, the Patent Office found the subject matter to be patent-eligible under section 101.
The Federal Circuit affirmed the district court conclusion that the claims are directed to a natural law and recite no other inventive concept. In discussing whether the claims were drawn to a judicial exception, the Federal Circuit emphasized consideration of whether the claimed concept was a general principle. This parallels the emphasis the court placed on preemption in ChargePoint for identifying a judicial exception within the claims.
In the Cleveland Clinic decision, the Federal Circuit explicitly rejected the constraints provided by example 29 of the May 2016 subject matter eligibility examples: life sciences (relating to a method of detecting an imaginary protein). Example 29, already in the shadow of the court’s 2015 decision in Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371 (2015), presents a stark example of separation between the courts and the USPTO.
Dealing with the Divide
The swift post-Guidance divergence between the Patent Office and the courts is troubling. The issue of subject matter eligibility is complex and somewhat philosophical by nature, and requires the determining bodies to have the same approach, if not the same mind. The clear division between the body tasked with granting patents and the body tasked with enforcing them threatens to create uncertainty that prolongs litigation and undercuts the patent system.
The Supreme Court stated, in Parker v. Flook, 437 U.S. 584 (1978), “The obligation to determine what type of discovery is sought to be patented must precede the determination of whether that discovery is, in fact, new or obvious.” Nonetheless, some of the information gathered in analyzing novelty (35 USC 102), obviousness (35 USC 103), and enabled description (35 USC 112(a)) can inform this determination. The resulting analysis is a concurrent assessment of the invention, the inventive field in which the invention is situated, and the effect the claims would have on the inventive field if granted. The threshold determination of patent subject-matter eligibility is based on analyzing the totality of this information.
While the course to a consensus is less clear than ever, it appears that when addressing whether a claim is drawn to a judicial exception, a practitioner should consider: (i) whether the claimed subject matter is similar to those within the cases listed in the Quick Reference; (ii) whether a recited claim incorporates a useful, inventive application; and (iii) whether that application pre-empts all other applications within a general concept.
Put another way, a concept or law that has always been true (even if not previously discovered) is unlikely to be patentable; a novel method of making use of the pre-existing reality in a particular field of human endeavor is likely to be patentable; and which category a particular invention occupies is less clear than it was before the adoption of the 2019 Guidance.
A Congressional Solution?
On April 17, Sen. Thom Tillis (R-N.C.), the chairman of the Senate Judiciary Subcommittee on Intellectual Property, and Sen. Christopher Coons (D-Del.), its ranking member, released a framework for prospective federal legislation on patent eligibility.
The framework proposes to:
- Keep existing statutory categories of process, machine, manufacture, or composition of matter, or any useful improvement thereof;
- Eliminate, within the eligibility requirement, that any invention or discovery be both “new and useful.” Instead, simply require that the invention meet existing statutory utility requirements;
- Define, in a closed list, exclusive categories of ineligible subject matter, including fundamental scientific principles, products that exist solely and exclusively in nature, pure mathematical formulas, economic or commercial principles, and mental activities;
- Create a “practical application” test to ensure that the statutorily ineligible subject matter is construed narrowly;
- Ensure that simply reciting generic technical language or generic functional language does not salvage an otherwise ineligible claim;
- Statutorily abrogate judicially created exceptions to patent eligible subject matter in favor of exclusive statutory categories of ineligible subject matter; and
- Make clear that eligibility is determined by considering each and every element of the claim as a whole and without regard to considerations properly addressed by 102, 103 and 112.
Such legislation could resolve the divisions between the governmental branches. Until it is in force, however, writing claims to satisfy the judiciary is probably the most prudent course for applicants.