Guest Post -- Recent Software Case Gives Important Lessons for Biotech

By Nicholas Vincent* and Anthony D. Sabatelli** --

On September 13, the Federal Circuit held that a series of ordered combination of steps related to lip-synch software did not constitute an abstract idea, and was subsequently patent eligible under §101 (McRO, Inc. v. Bandai Namco Games America).  This decision reversed and remanded an earlier decision issued by the United States District Court for the Central District of California in McRO, Inc. v. Sony Computer Entertainment America, LLC.  This case, which was followed closely by the IT community, also has important, positive implications for the patent eligibility of biotech inventions.

The earlier decision asserted in 2014 that U.S. Patent Nos. 6,307,576 ('576) and 6,611,278 ('278) were invalid, as they were not based on patentable claims under § 101.  In particular, the decision held that, although there were novel portions of the invention, they were claimed too broadly, thereby invalidating the patents.  Patents '576 and '278 share the same title ("Method for Automatically Animating Lip Synchronization and Facial Expression of Animated Characters").

In the current ruling, the Court sought to apply the two-step Alice test, a test that first addresses whether the claims are directed toward an abstract idea, and if they are, then considers whether the claims recite something "significantly more" that makes the claims patent-eligible.  In applying the first step of the Alice test, the Court found that representative Claim 1 of '576, which focuses on particular improvements in computer animation, is not directed towards an abstract idea.  In addition, the Court went on to state that the advancement represents a significant improvement on the prior art.  As a result, step one of the Alice test is not met, and the software-encoded combination of steps for the lip-synch software is therefore patent eligible under § 101.  Interestingly, the Court did not reach step two of the test, showing that it is possible to pass the Alice test on step one alone, giving hope to future claims that may face Alice-related challenges.

Interestingly, McRO maintained in its position that the claims are patent eligible because they constitute an improvement in animation, regardless of whether they are claiming an abstract idea.  In fact, McRO claimed that Diamond v. Diehr was the relevant precedent since the final product is a 3-D video and not an abstract idea.  This was challenged by the defendants who claimed that a past case, Parker v. Flook, was most pertinent to the patentability of the lip-synch software mainly because McRO was patenting what the defendants claimed was an unpatentable algorithm.  The Court, as previously stated, held otherwise.

The image represents a 'viseme' (a representation of a character from the lip-synch software making a sound).  In this image from McRO, Inc. v. Bandai Namco Games America, the character is making the 'aah' sound, which corresponds to one component of a more complex and programmable speech pattern.

The highly anticipated McRO decision comes on the tails of three recent decisions also by the Federal Circuit:  the Rapid Litigation Management, Enfish, and BASCOM decisions, the latter two of which are also from the computer/ software realm, and not the biotech world.  Together, these decisions are expected to play an important role in guiding the formation of patent-eligible claims that, historically, would have likely been considered patent-ineligible under the Alice test.  Specifically, and in relation to the McRO decision, claiming improvements on prior art seems to be both a promising and successful way of overcoming potential Alice-related challenges.

Together, McRO, Rapid Litigation Management, Enfish, and BASCOM give the biotech field important guidance in developing patent-eligible biotech claims.  Not only does this new developing precedent grant the potential for expanded patentability, but it also provides a clearer means to overcoming Alice-related challenges in the future.  The message for biotech is to craft claims and set up the background in the specification to clearly point out the importance and improvements of the technology.  Clearly, if there is an improvement over the state of the art, this bodes well for patent eligibility.

For biotechnology, the implication of expanded patentability is particularly promising; as biotechnology research engages more frequently with larger data sets and uses more complex, quantitative, and software-based approaches to answer questions, computing and software will play a larger role in these research endeavors.  Computers and software are becoming increasingly more enmeshed with many areas of biotech research and developments.  Moving forward, the ability to successfully defend algorithm-based patents against Alice challenges on the tails of McRO will likely focus primarily on the improvements over prior art, a shift from an earlier focus on the abstract nature of the innovation in question.

* Nicholas Vincent is a Technology Specialist at Dilworth IP
** Dr. Sabatelli is a Partner with Dilworth IP

Comments

[Paul Cole]

There are strong arguments that the Mayo/Alice analysis is narrower than generally appreciated.

Very little attention is paid, either in court decisions or in the USPTO Guidance to the requirement to comply positively with one or more of the eligibility categories of Section 101. This omission is astonishing considering that such compliance is an essential precondition of any eligibility enquiry and ought to have a significance on the outcome of any Mayo/Alice analysis.

In particular, the mere recitation of a sequence of steps is insufficient for the claimed subject-matter to fall into the eligible process category, see MPEP 2106 Patent Subject Matter Eligibility and the reference to Gottschalk v Benson which would repay study, in particular in relation to the abstractedness of the claims in issue and the omission in the Supreme Court opinion of any mention of the advantages associated with the method or any new result achieved. Unfortunately there does not appear to be any published version of the specification that was in issue in that case, so we do not know what the significance of the method sought to be patented may have been or what its real world advantages (if any) were, but these do not appear to have been before the Court. To qualify as an elegible process the claimed sequence of steps should be transformational and lead to a new function or result which is the inventor's own discovery, and non-compliance with this requirement is an indicator of a poor outcome.

Assuming that there is some prima facie compliance with one or more of the 101 categories, then the term "directed to" in the first step of the Mayo/Alice analysis could be regarded as somewhat narrow. A process of cooking an omlette involves eggs which are a narural product, and relies on a law of nature that eggs harden from a liquid state under the action of heat, but neither of these things means that the cooking method is "directed to" eggs.

Focus on the improvements over the prior art is clearly a pointer in a favourable direction.

[skeptical]

Transformative...?

As in Machine or Transformation?

I will refer you to the Bilski Supreme Court case that in noninsetyled terms (and one of two 9-0 portions of that case) that takes your view and refutes it.

In essence Mr. Cole, you are chasing the Windmill of thinking that the Supreme Court cases can be reconciled, one with another (and with all).

They cannot be.

The faster you realize this, the better your energies will be put to good use.

Do I need to say "I told you so" yet again?

[Scooby Don't]

"Together, these decisions are expected to play an important role in guiding the formation of patent-eligible claims"

LOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOL

Because two self-interested patent attorneys at some place called "Dilworth" say so?

Funny stuff.

You could at least attempt to take a poll, guys. Not everyone shares your "expectations". But maybe some self-serving propaganda will keep a few naive clients feeding you for a while longer.

[skeptical]

The garbled phrase should read: "in no unsettled terms"

[skeptical]

I see that the rather unimaginative Malcolm has "borrowed" a new word: propaganda.

Of course, he is simply using his favorite ploy of accusing others of that which he does with his use of that word.

Get well soon, PatentDocs

[Paul Cole]

I am tempted to ask whether the Alice Two-Step is some kind of ballroom dance.

Somehow the phrase "... two-step Alice" prompted this mischievous thought.

I am confident Skeptical will have a viewpoint.

[skeptical]

Yes, Mr. Cole, I do have a viewpoint, and at the end of the day, when you have reflected on all of the "I told you so"s, will you realize the disconnect between your admittedly patient and thorough analysis and what is actually happening in US jurisprudence?

Sadly, on that note, I remain...

[Paul Cole]

@ Skeptical

Do you have a sense of humor?

My research reveals that the Alice Two-Step is derived from the Country and Western dance tradition. In the present difficult situation that thought might, perhaps, cheer us up.

[skeptical]

Paul,

I find the current joke of US jurisprudence on this subject something NOT to laugh about.

(outside of that, I have a wonderful sense of humor)