Stupid § 101 Tricks

By Michael Borella --

With apologies to David Letterman.

If we have learned anything from the last six-and-a-half years of patent eligibility jurisprudence, it is that nobody knows what's going on.

Subject matter eligibility is a fundamental requirement for an invention to be patentable.  According to 35 U.S.C. § 101, "[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, subject to the conditions and requirements of this title."  This definition is quite broad, covering virtually any physical thing (machines, articles of manufacture, and compositions of matter) and any series of steps used to achieve a goal (processes).  Indeed, 40 years ago, the Supreme Court ruled that Congress had intended the statute to "include anything under the sun that is made by man."

But a series of decisions by the Court from 2010 to 2014 significantly narrowed the scope of what is patentable.  This culminated in Alice Corp. v. CLS Bank Int'l, which held that claims of all statutory categories must have their eligibility determined by a two part test.

In a nutshell, the first part was described as "determin[ing] whether the claims at issue are directed to one of [the] patent-ineligible concepts" of laws of nature, natural phenomena, and abstract ideas.  If this is the case, then for the second part one must "consider the elements of each claim both individually and 'as an ordered combination' to determine whether the additional elements transform the nature of the claim into a patent-eligible application."  The Court described the second part as "a search for an 'inventive concept'—i.e., an element or combination of elements that is 'sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself.'"

While finding the claims in Alice directed to an abstract idea, the Court declined to actually define the term "abstract idea" in any meaningful fashion, noting that "we need not labor to delimit the precise contours of the abstract ideas category in this case."  The Court's treatment of the "search for an inventive concept" was similarly elusive.  Consistent with the prior holding of Mayo Collaborative Servs. v. Prometheus Labs., Inc., so-called "well-understood, routine, conventional activities previously known to the industry" would not clear this hurdle.  Regarding the computer-implemented claims of Alice, the Court wrote that:

[M]ere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention.  Stating an abstract idea while adding the words 'apply it' is not enough for patent eligibility.  Nor is limiting the use of an abstract idea to a particular technological environment.  Stating an abstract idea while adding the words 'apply it with a computer' simply combines those two steps, with the same deficient result.  Thus, if a patent's recitation of a computer amounts to a mere instruction to implement an abstract idea on . . . a computer, that addition cannot impart patent eligibility.

In practice, the introduction of this test effectively made it more difficult to patent certain types of inventions -- particularly, diagnostic methods, software, and business methods.  As a result, there has been consternation over the Court's opinions not only in how they have reduced the ability to protect critical innovations that drive the U.S. economy, but also how vague the Justices left the line between inventions that are eligible for patent and those that are not.

Indeed, a number of federal judges have strongly criticized Alice and its progeny.  Judge Wu of the U.S. District Court for the Central District of California panned Alice for setting forth an "I know it when I see it" test.  Judge Pfaelzer, a colleague of Judge Wu, wrote that the Supreme Court's patent eligibility cases "often confuse more than they clarify [and] appear to contradict each other on important issues."  More recently, Judge Plager of the Federal Circuit wrote that the post-Alice § 101 inquiry "renders it near impossible to know with any certainty whether the invention is or is not patent eligible."  Former Chief Judge of the Federal Circuit Paul Michel stated that Alice "create[d] a standard that is too vague, too subjective, too unpredictable and impossible to administer in a coherent consistent way in the patent office or in the district courts or even in the federal circuit."  And these are just a few examples of judicial confusion.  There are more.

Having said that, there are a few lines of attack that have been used by judges and patent examiners over the few last years that are particularly egregious.  Using these patterns allows a quick kill -- rejection of pending claims or invalidation of granted claims on grounds of ineligibly without the legal or factual reasoning that one would expect from the USPTO and the federal courts.  We'll call these "Stupid § 101 Tricks" for lack of a better term.

Trick 1: Abstract Is As Abstract Does

What does it mean to be "directed to" an abstract idea?  There is no clear answer, but all too often it involves a process that resembles a self-fulfilling prophecy.  Particularly, one takes a claim, removes most or all of the technical detail, views what is left at a 10,000 foot level, and then declares that this drastically summarized version of the claim language is abstract.  The logical fallacy comes in the next step, where one then declares that because the summarized version is abstract, the whole claim is directed to an abstract idea.  Or, in other words, you remove everything that is concrete in a claim and then assert that the claim is abstract based on what little is left.

The Supreme Court specifically warned against doing this, noting in Alice that "at some level, all inventions embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas," and that one must "tread carefully in construing this exclusionary principle lest it swallow all of patent law."  And yet, the Federal Circuit is guilty of this summarizing-to-abstraction.  In Recognicorp, LLC v. Nintendo Co. Ltd., it took a 154-word claim directed to a particular type of data compression technology, and declared it to be directed to the abstract idea of "encoding and decoding image data."  For those of you doing not doing the math at home, the Court compressed 154 words into 5 words without the benefit of any algorithm like that of Recognicorp.

And Recognicorp was not the only victim of this trick.  The Federal Circuit effectively rubber-stamped a district court's oversimplifying of claims essentially down to their preambles in Two-Way Media Ltd. v. Comcast Cable Communications, LLC, and also summarized a 155-word claim in Intellectual Ventures I v. Symantec Corp. down to the abstract idea of "backing up data."

There are numerous further examples in the courts as well as in USPTO examination.

Trick 2: Prima Facie Case?  What Prima Facie Case?

Speaking of the USPTO examination, let's pick on that for a while.  According to the USPTO's guidance entitled October 2019 Update: Subject Matter Eligibility, "the initial burden is on the examiner to explain why a claim or claims are ineligible for patenting clearly and specifically, so that the applicant has sufficient notice and is able to effectively respond."  Further, "[o]nce the examiner has satisfied the initial burden, the burden of coming forward with evidence or argument shifts to the applicant."  Sounds good, right?  But what can happen in practice is quite different.

Examiners often avoid truly establishing a prima facie case of ineligibility by instead following a three step process: (i) quote claim language, (ii) quote boilerplate rejection language, and (iii) conclude that the claim is ineligible.  Here's a generic example modeled after actual USPTO rejections:

Claim is directed to [quote claim 1 in its entirety].  This claim recites a [mathematical concept / mental process / method of organizing human activity] and is not meaningfully different from concepts found to be abstract ideas by the courts.  The claim does not include additional elements that are sufficient to amount to significantly more than the judicial exception because the additional elements when considered both individually and as an ordered combination do not amount to significantly more than the abstract idea.  Therefore, the claim does not meet the requirements of § 101.

You'll note that rejections of this style can be quite long but they do not say much.  Particularly, there is no actual reasoning pertaining to why the claim is abstract.  There is no identification of particular claim elements that are abstract or that are analogous to other claims previously found abstract by the courts.

But when interviewed, examiners who issue these types of rejections often believe that they did meet their prima facie burden even though they did not.[1]  Such examiners frequently contend that if the claim is not abstract, it is the applicant's job to explain why.  When challenged, examiners that issue these conclusory rejections often write more words defending their non-analysis than explaining why the claim was rejected.  The result is improper burden shifting from the USPTO to the applicant, an increased cost to the applicant, and an uphill battle for the applicant to be able to be provided with "sufficient notice and [to] able to effectively respond."

Trick 3: Wither the Dependent Claim?

On a related note, pity the dependent claim rejected under § 101.  Often, all dependent claims are rejected summarily with vacuous reasoning such as "the dependent claims merely further define the abstract idea or recite mechanisms of a generic computer, and therefore also lack eligibility."  Doing so also goes against the grain of MPEP § 2106.07, which states that the § 101 evaluation "should be made on a claim-by-claim basis, because claims do not automatically rise or fall with similar claims in an application," "even if an independent claim is determined to be ineligible, the dependent claims may be eligible because they add limitations amounting to significantly more than the judicial exception recited in the independent claim," and "each claim in an application should be considered separately based on the particular elements recited therein."

And yet, pointing this out to examiners rarely makes a difference.  Examiners challenged on this point again apply improper burden-shifting, stating that if the applicant does not argue for the eligibility of the dependent claims separately (even though these were rejected en masse), the rejections will stand.  If you think that appealing this point to the PTAB would set the record straight, think again.

It is now well-established that, during litigation, the parties can agree upon a representative claim to analyze in lieu of a separate § 101 analysis for each.  But doing so during examination without the applicant's consent essentially provides the examiner with a short-cut to ignore the dependent claims.  The USPTO either needs to clarify its guidance or enforce it.

Trick 4: Ghosting the Technical Improvement

One way to overcome an Alice rejection in the USPTO or an Alice challenge in court is to establish that the claimed invention provides a technical improvement over the state of the art.  In many cases, this can be done by pointing to such an improvement (when it exists) in the claim language or the specification, as was done in Enfish, LLC v. Microsoft Corp. and McRO, Inc. v. Bandai Namco Games America Inc., for example.

Similar arguments can be successful in the USPTO.  Moreover, according to the October 2019 Update, "[t]he claim itself does not need to explicitly recite the improvement described in the specification," and "[t]he specification need not explicitly set forth the improvement, but it must describe the invention such that the improvement would be apparent to one of ordinary skill in the art."  Thus, when the claims and specification do not overtly describe the technical improvement provided, one can still argue that it is inherent.

Nonetheless, both courts and the USPTO have been known to summarily dismiss, downplay, or outright ignore purported technical improvements in claimed inventions.  In the courts, this can happen when the claims are analogous -- even at a high level -- to those of a case in which a § 101 ruling went against the patentee.  One need look no further than Recognicorp for an example, where the patentee argued that the invention provided a technical improvement.  The Federal Circuit concluded -- after a non-substantive dismissal of this argument -- that claims "directed to encoding and decoding image data [are not] a software method that improves the functioning of a computer."  Such a statement is hard to square with the image processing claims of McRO that were found eligible by the same court just a few months earlier.  An even more glaring example was in American Axle & Mfg. v. Neapco Holdings LLC, where Judge Moore of the Federal Circuit dissented from the majority view that a claim was invalid under § 101 and pointed out that there were numerous disclosures of the invention's technical improvements in the specification and that were made during oral argument.

In the USPTO, it is commonplace for an initial Office action to completely ignore any technical improvement disclosed in the claims or specification.  Boilerplate that we see in these rejections goes like this:  "The combination of these [claimed] elements offers nothing more than generally linking the use of the judicial exception to a particular technological environment or field of use because the claimed machine is not particular, and the claim as a whole monopolizes the abstract idea."  This standard rejection language shows up even when a specification has several paragraphs describing the improvements in detail.

If the examiner disagrees with the applicant as to whether these stated technical improvements are indeed enough to meet the § 101 requirements, that is fine.  But the examiner should make that case.  Without any substantive reasoning, the applicant is provided with a rejection and nothing to rebut.

Even worse, after an applicant files a response describing the technical improvements (and perhaps pointing to relevant sections of the specification when doing so), a subsequent Office action arrives with the exact same rejection and no discussion (or minimal, conclusory discussion) of the applicant's arguments.  Again, if the examiner disagrees, the grounds for that disagreement should be made of record.

Trick 5: Forgetting That If You Can Drop the Invention on Your Foot, It Probably Is Not Abstract

Much hay has been made about the Federal Circuit's recent expansion of the judicial exceptions to patent eligibility beyond pure math, software, and business methods, and into inarguably tangible inventions.  In addition to American Axle (involving the manufacture of driveline system shaft assemblies), judicial exceptions have metastasized in The Chamberlain Group, Inc. v. Techtronic Industries Co. (involving a garage door opener) and ChargePoint, Inc. v. SemaConnect, Inc. (involving a charging station for electric vehicles).  Admittedly, the judicial exception in American Axle was a law of nature, but the Court's reasoning was so similar to that used in its abstract idea analyses that any differentiation on these grounds is largely academic.

A legal definition of abstract idea remains difficult -- if not impossible -- to pin down.  The Google-provided dictionary definition of "abstract" is "existing in thought or as an idea but not having a physical or concrete existence."  But one cannot square such a definition with the case law.  Some of the claims in Alice were found abstract despite reciting physical, tangible computer hardware.  To be sure, pure software written in code is stored on a physical tangible medium, such as a disk drive, flash memory, CDROM, etc.  While thinking about software is abstract, the code and equipment that makes your computer display or print this article -- or do anything else for that matter -- is not.  The dictionary definition does not help us decode how the courts are applying § 101.

Instead, the abstract idea is an elaborate legal fiction that has little to do with the layperson's understanding of what might or might not be abstract.  Without being grounded in statute or plain meaning, it is not hard to see why patentees, patent attorneys, the USPTO, and federal judges remain unable to agree on whether certain types of inventions are eligible for patenting.  And this gray area covers many types of inventions that are not only at the bleeding edge of research, but also crucial to the U.S. economy and competitiveness.  Artificial intelligence, machine learning, data science, and quantum computing innovations are more difficult to patent due to the current interpretation of § 101.

Which brings us back to a point made earlier.  If a goal of the § 101 analysis is to avoid letting the exclusions swallow all of patent law, then we need to draw the line somewhere.  Reasonable minds can differs on the exact contours of this line, but we have to ensure that it does not rule out what the law is intended to protect -- innovative new technologies.

[1] To be fair, only a minority of examiners engage in this behavior and this minority has gotten smaller since the USPTO revised its § 101 examination procedures in 2019.  But it still happens and it is still wrong.

Comments

[What a mess]

I have all five of these tricks in a single Office action right now. The claims are for a communication system, and they all recite numerous physical components, but the examiner just waved those away as "generic computers" because the specification says they can include processors, ASICs, software, etc. It took something like 6 hours just to rebut the 101 rejection(s) (which, per Trick 3, were all lumped together).

[Karl P. Dresdner, Jr. Patent Agent 63,319]

Michael,
Thank you for your write up here. I agree with all your points.

[MW]

This is a great summary of the frustrations of §101 rejections, thanks.

Thanks also want for what must be a huge effort in continuing to provide this blog. It’s an absolute “must read” for me

[Brian Charles Anscomb]

Please keep us updated with respect to PTO's reply to your 101 rebuttal arguments. Thanks in advance!