Congress Releases Framework for Section 101 Reform

By Kevin E. Noonan --

Over the past six years, since the Supreme Court handed down its decision in Mayo Collaborative Services, Inc. v. Prometheus Laboratories, it has become more and more evident that correction of the path embarked upon by the USPTO, the district courts, and the Federal Circuit could only occur if Congress changed the law of patent subject matter eligibility.  Recently Senator Thom Tillis (R-NC), Chair of the Senate Judiciary Subcommittee on Intellectual Property, and Senator Chris Coons (D-DE), Ranking Member, have been holding meetings with stakeholders in an attempt to craft such revisions in a way that would garner sufficient political consensus for passage (what would happen if it crossed President Trump's desk is anyone's guess, but one challenge at a time).

Today these Senators, joined by Representative Doug Collins (R-GA-9), Ranking Member of the House Judiciary Committee, and Representatives Hank Johnson (D-GA-4), and Steve Stivers (R-OH-15), released a "bipartisan, bicameral framework on Section 101 patent reform."  The need is acute, according to Chairman Coons:

Today, U.S. patent law discourages innovation in some of the most critical areas of technology, including artificial intelligence, medical diagnostics, and personalized medicine.  That's why Senator Tillis and I launched this effort to improve U.S. patent law based on input from those impacted most.  I am grateful for the engagement of all stakeholders participating in our roundtables, as well as the bipartisan and collaborative efforts of colleagues in both the Senate and the House.  I look forward to continuing to receive feedback as we craft a legislative solution that encourages innovation.

The framework has the following provisions:

• 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 statutory subject matter which alone should not be eligible for patent protection.  The sole list of exclusions might include the following categories, for example:

▪ Fundamental scientific principles;

▪ Products that exist solely and exclusively in nature;

▪ Pure mathematical formulas;

▪ Economic or commercial principles;

▪ 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.

• 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.

While a "work in progress," the framework contains several of the provisions proposed by IPLAC, AIPLA, IPO, and the ABA-IPL section.  But this proposal provides for frank abrogation of the judicial exceptions, a stratagem within Congress's purview but perhaps one not particularly well advised.  The judicial exceptions (occasional effects not to the contrary) are not judicial whims: the Court firmly believes that they are necessary to prevent Congress from exceeding its Constitutional authority under Article I, Section 8, clause 8.  This is consistent with their role in our system of government, and at best the consequence of any such abrogation will be that it is ignored in practice, and at worst it could motivate the Court to recite even more stringent and strictly applied limitations on Congress's power to grant patents.  The Court's forays into patent policy making have been unfortunate to say the least; anything that encourages these tendencies is unlikely to end well for U.S. innovation.  Instead, it may be more productive to recognize, if not acknowledge, the basis for the judicial exceptions and try to introduce into the patent statute more circumscribed, exact, and defined recitations of these principles in ways that might cabin the Court's application to a greater extent than is possible under current law.

Comments

[Cass L. Singer]

I do not think that the Supreme Court will agree that the stratagem of frank abrogation of the judicial exceptions is "within Congress's purview." Members of the Court have indicated since TSR that the policies it has imposed are *constitutionally* required -- and therefore outside Congress's purview to alter, as it has found in so many other areas.

I applaud any effort to rein in the current Court. But I fear the only way to return some sensibility to the Court is to change who or how many sit on the Court.

[Skeptical]

I have to vehemently disagree with the statement in the article of:

"This is consistent with their role in our system of government."

For every suggestion of propriety of the Court action, there are at least three counters that show Constitutional INFIRMITY in their actions.

[Skeptical]

...and I would further add that IF there is an actual concern that the law (as opposed to a patent granted under the law) did pose a Constitutional problem, then the Court's action is constrained to a few methods (including throwing the law out).

The Court HAS NO LEGITIMATE authority to rewrite the law (under the guise of "exception" or otherwise) in the realm of statutory law that is patent law.

[Kevin E Noonan]

As is evident from these comments, reasonable people can differ. Unfortunately the Supreme Court will have the last word (absent amending the Constitution, which won’t happen over a patent question). The Court is not final because it is infallible but rather it is infallible because it is final. And I don’t ever see getting a bunch of patent lawyers on the Court, which may be the only way to bring sanity to this area of the law.

Thanks for the comments

[Greg DeLassus]

"Unfortunately the Supreme Court will have the last word (absent amending the Constitution...)."

Hm, I expect that you are correct that the Court *will* have the last word. I am not sure that it will require a constitutional amendment to avoid the Court undoing Congress' efforts to clean up the Mayo mess. A mere statutory amendment to the judiciary act to remove patent appeals from the Court's certiorari or mandamus jurisdiction would equally well solve the problem.

Meanwhile, I am not sure that we need actually worry about this Court opposing Congress here. Only three current justices joined Justice Stevens Bilski concurrence, which tried to ground the so-called "judicial exceptions" in the doctrine of constitutional avoidance. Presumably, then, four of the remaining justices think that the "judicial exceptions" are *not* a matter of constitutional necessity. If even one of the two Trump-appointed justices agree with that four judge bloc, that would be enough to sustain Congressional action to narrow the scope of "judicial exceptions." I like those odds.

[Skeptical]

There is always the legitimate power of Congress to employ jurisdiction stripping of the non-original jurisdiction of patent appeals and REMOVE the Supreme Court from its “perch.”

Marbury may be satisfied with a new (and reset - due to the already felt effects of Supreme Court ‘simian training’ on the CAFC) Article III Court.

[EG]

Knowles restatement of Section 101 on IPWatchdog is the best I've seen. Short, to the point, and NO EXCEPTIONS.

[Greg DeLassus]

"Presumably, then, four of the remaining justices think that the 'judicial exceptions' are *not* a matter of constitutional necessity."

Whoops, my math is wrong. There are three justices who have joined the Court since Bilski, not two. In other words, there is presumably a three-justice bloc who consider the "judicial exceptions" to be a matter of constitutional necessity, and three who do not. We need two of the three newbies to side with the not-constitutional-requirement reading of the "judicial exceptions" in order for the Court to sustain a Congressional cabining of the "judicial exceptions." I still like those odds.

[Skeptical]

Mr. DeLassus,

Let's keep in mind that one of those new Justices has ALREADY laid down not one but two sharp implements that may be fashioned together to cut through the Gordian Knot created by the Supreme Court itself in its meddling into rewriting the statutory law that is patent law, specifically the patent law of 35 USC 101 (which IS - and not any part of the Constitution - at the focal point here).

Sharp implement one: the holding in SCHEIN.
Sharp implement two: the oral argument in California Tax Board v. Hyatt.

What we all SHOULD be emphasizing (so that the Court hears this loudly and clearly), is that both of these sharp implements are directly on point [sic] to what the Court has done, and that not only the other courts (as reflected in SEVERAL views expressed by the CAFC), but also the Executive Branch (as directly expressed by Director Iancu) and now the Legislative Branch - EACH AND ALL - are pointing out that the Court is to blame for the mess.

Let's make it a necessity for the Court to save face by having IT apply the Kavanaugh Scissors.