USPTO Issues Memorandum Regarding Enfish and TLI

By Michael Borella --

On the heels of the Federal Circuit handing down two subject matter eligibility decisions regarding software, the U.S. Patent and Trademark Office has published a memo to its examining corps regarding these cases.  On May 12, in Enfish, LLC v. Microsoft Corp., the Court found software claims patent-eligible for the first time in almost 18 months.  Five days later, in TLI Communications LLC v. AV Automotive, L.L.C., the Court once again invalidated claims directed to software for failing to meet the requirements of the two-part test set forth in Alice Corp. v. CLS Bank Int'l.

When applying the test to a claim, one must first determine whether the claim at hand is directed to a judicially-excluded law of nature, a natural phenomenon, or an abstract idea.  If so, then one must further determine whether any element, or combination of elements, in the claim is sufficient to ensure that the claim amounts to significantly more than the judicial exception.  Notably, generic computer implementation of an otherwise abstract process does not qualify as "significantly more."

As has become common practice in these memos, the USPTO sticks closely to the language of the cases.  Particularly four points are made about the Enfish decision:

First, the court noted that when determining whether a claim is directed to an abstract idea, it is appropriate to compare the claim to claims already found to be directed to an abstract idea in a previous court decision.

Second, the court emphasized that the "directed to" inquiry applies a filter to claims, when interpreted in view of the specification, based on whether their character as a whole is directed to a patent ineligible concept.

Third, the Federal Circuit cautioned against describing a claim at a high level of abstraction untethered from the language of the claim when determining the focus of the claimed invention.

Fourth, the court stated that an invention's ability to run on a general purpose computer does not automatically doom the claim.

The second and third points may be the most helpful for patentees.  The second point permits "an examiner [to] determine that a claim directed to improvements in computer-related technology is not directed to an abstract idea" under the first prong of Alice, without having to analyze additional elements under the second prong.  In making this determination, the examiner may look to the specification's teachings to decide whether the claimed invention achieves benefits over conventional approaches.

The third point may come in handy when a patentee argues that the examiner has not established a prima facie case of subject matter ineligibility.  All too often, examiners characterize the claimed invention in a brief summary that, at best, describes the invention at a very high level and in simplistic terms.  Here, the Office appears to be instructing the examining corps to honor the language of the claims when considering whether they are directed to an abstract idea.  As a result, examiners may find it more difficult to conclude that some claims are abstract.

The USPTO discussed the TLI case mainly because it provides contrast to Enfish.  The claims therein were found patent-ineligible because they "describe steps of recording, administration and archiving of digital images . . . directed to the abstract idea of classifying and storing digital images in an organized manner" and "the additional elements of performing these functions using a telephone unit and a server did not add significantly more to the abstract idea because they were well-understood, routine, conventional activities."

As the memo correctly points out, these decisions are consistent with the USPTO's subject matter eligibility guidance from July 2015.  Nonetheless, applicants and patent holders may benefit from the substantive and procedural clarifications discussed above.

Already, some are contending that Enfish and TLI cannot be reconciled with one another.  This is not true.  Enfish stands for the notion that an improvement to computing technology, whether software or hardware, is not in and of itself abstract.  TLI, on the other hand, reaffirms that merely using generic computer technology to carry out a procedure does not add patentable weight to a claimed invention.  In one case, the claims recite the invention of new technology, and in the other case, the claims recite the use of old technology.  A clear line has been drawn.

Still, many new and useful inventions are based on novel arrangements of old technology, and these inventions are at risk in a post-Alice world.  We find ourselves in this state of affairs because the Alice test allows one to subjectively divide a claim into abstract and non-abstract parts when considering patent-eligibility, rather than view the claim as a whole.  Nonetheless, if we accept that we have to live in the world of Alice at least for now, the distinction between Enfish and TLI is critical to understand, as it provides a roadmap to patent-eligibility for a great many software inventions.

Comments

[skeptical]

There is so much very wrong with this article I scarcely know where to begin.

Let's begin with 35 USC 100(b) and compare that to one of the proposed takeaways:

"In one case, the claims recite the invention of new technology, and in the other case, the claims recite the use of old technology. A clear line has been drawn."

Several problems:
- there is no such "technology" requirement in the law as written by Congress
- the use - IF NEW - of old technology is DEFINED to be patent eligible (leastwise, belonging to a patent eligible category - I will provide that the other portion of 101 - having the right type of utility - still must be met.

Such line drawing for statutory patent law - clear or otherwise - is not the dominion of the judicial branch.

[skeptical]

...this type of "gee shucks, we have to live with what the Supremes have done" is the absolute wrong path to take.

It is downright offensive on the order of Dred Scott.

Either push back or stomp down on the gas pedal. But do NOT under any circumstance take this type of mealy approach.

[Whats up in patent law]

Enfish appears to create a safe harbor in the "first step" of the Alice analysis, the step of identifying a judicial exception, in particular an abstract idea: "Therefore, we find it relevant to ask whether the claims are directed to an improvement to computer functionality versus being directed to an abstract idea, even at the first step of the Alice analysis" (p. 11 of the Enfish slip opinion).

As the opinion acknowledges, this brings the "something more" analysis into the first step in the form of an "improvement" argument, albeit limited to "computer functionality."

Left for future clarification is the definition of "computer functionality." TLI provides one contrasting fact pattern, so that we have, figuratively, two data points, from which to derive a rule. Neither opinion provides an explicit rule.

In Enfish an improved generic database is claimed, and that falls within the "computer functionality" safe harbor.

In TLI digital images are remotely databased with a classification scheme.

Does one represent "computer functionality" and the other not? Or do both represent "computer functionality," while only Enfish includes clear improvement? TLI appears to suggest that it is the breadth of the claims and the clarity of the improvement argument that distinguishes the Enfish vs TLI claims, so that the differing holdings may imply nothing about what does or does not qualify as "computer functionality."

This safe harbor is no small matter in that it potentially makes many claims patent eligible, though it is not yet clear which.

For example, what about a claim to a clearly improved method of segmenting digital images, classifying the segments and databasing the extracted information?

At what point does a computer algorithm (i.e. a potential abstract idea) qualify or not qualify as "computer functionality," such that as long as improvement is clearly of record, then patent eligibility follows, in the first step of the Alice analysis.

Is the rule regarding "computer functionality," limited to something like functions historically performed on a computer? Functions addressed in basic computer science? But, computer applications in many fields might qualify under this rule.

Does the rule include any function requiring performance on a computer?

Is the rule limited to functions NOT clearly associated with some other field? E.g., pick a computer application: engineering, science, etc., if a function is more closely related to some "other" field, then does it not qualify for the safe harbor?

The effect appears to be that Enfish solidifies a safe harbor in which, for some subset of claims, improvement can be argued looking solely at the possible abstract idea and the claim as a whole, in the "first step." This is in contrast to looking for "something more" via an improvement argument in the "second step," which "something more" analysis had begun to require looking at "additional elements" of a claim, to some extent independent of an abstract idea identified in the first step.

Some will agree with this blurring of (or doing away with) the lines between the first and second Alice steps, arguing that the division into two steps was arbitrary and invited dissecting claim elements so to ignore significant combinations. Possibly, but Alice still controls.

Enfish solidifies a safe harbor, but only for a yet-to-be-defined subset of claims.

[Distant Perspective]

It may be superfluous to post a reminder to relevant parts of the oral argument in Alice.

General Verilli (Alice oral argument, p45): "Yeah, with - let me address software patents first because that, I think is obviously a significant question. And it's just not correct to say that our approach would make software patenting ineligible. Any software patent that improves the functioning of the computer technology is eligible. Any software patent that improves - that is used to improve another technology is eligible. For example, the patent in the - in the Diehr case is one in which -"

Justice Sotomayor: "What's the necessity for us to announce a general rule with respect to software?"

Earlier in the oral argument, Justice Breyer (p.21): "It was like - there's a Bloomberg brief out there that was on this, that said, no, you can - you can patent computer software, when it's an improvement in software, when it's an improvement in a technology that has developed out of computers like robotics, when it is an improvement in a machine or technology, but you cannot improve it where it is simply in an activity that is engaged in primarily through mental processes."

Opinion for the Court in Alice (Justice Thomas):

"The method claims do not, for example, purport to improve the functioning of the computer itself. See ibid. (“There is no specific or limiting recitation of . . . improved computer technology . . . ”); Brief for United States as Amicus Curiae 28–30. Nor do they effect an improvement in any other technology or technical field. See, e.g. Diehr, 450 U. S., at 177–178. Instead, the claims at issue amount to “nothing significantly more” than an instruction to apply the abstract idea of intermediated settlement using some unspecified, generic computer."

These quotes seem to prefigure what is playing out in the Enfish/TLI dichotomy. But of course, to set precedents, the CAFC needs cases at least as "technological" as Enfish.

[Les]

"whether software or hardware, is not in and of itself abstract. TLI, on the other hand, reaffirms that merely using generic computer technology to carry out a procedure does not add patentable weight to a claimed invention. In one case, the claims recite the invention of new technology, and in the other case, the claims recite the use of old technology. A clear line has been drawn."

Isn't THAT line drawn by 35 USC 102 (and not 101) ?

"Already, some are contending that Enfish and TLI cannot be reconciled with one another. This is not true. "

In TLI the claims were drawn to a specific use (picture storage/retrieval). This is clearly an improvement to the computer itself. With the invention the computer can use categorization information to make later location and retrial of a desired image easier. Without it, the computer only accepts the image file name as a mechanism for finding the image, and the file name is easily forgotten by the user. Accordingly, TLI recites an improvement to the computer.

Enfish is also about data storage, but is vague about what data is stored other than the tables own index values. Because the invention is claimed in the abstract and does not recite an actual use, it is deemed as an improvement to the "computer itself" and thereby deemed eligible.

Meanwhile, the Court previously declared conversion of Binary Coded Decimal information to binary (or was it vice versa) as only useful in a computer (i.e. an improvement to the computer itself) and found that to be a reason for declaring the claims to be ineligible (Benson).

Kindly reconcile THAT.

[Martin Snyder]

The problem is information, not technology. All information is abstract. We want some (new, useful, fully described) to be eligible, in line with the Constitutional purposes of the patent act. We have no current means to distinguish eligible information inventions from ineligible, and we have a secondary problem that abstraction at eligibility (i.e not being tangible) is different that abstraction at patentibility (claiming too broadly, at the level of an idea rather than a single invention).

I propose a simple test, one that many actors are groping toward but not quite connecting with: information consumed by a human mind is automatically completely abstract, and should be ineligible, while information consumed by non-human actors (or a human body) should be eligible, subject to patentibilty requirements.

General Verilli (Alice oral argument, p45): "Any software patent that improves - that is used to improve another technology is eligible"

Justice Sotomayor: "What's the necessity for us to announce a general rule with respect to software?"

Justice Breyer (p.21): 'When it's an improvement in software, when it's an improvement in a technology that has developed out of computers like robotics, when it is an improvement in a machine or technology, but you cannot improve it where it is simply in an activity that is engaged in primarily through mental processes."