Abstraction in the Commonplace: Alice v. CLS Bank and its Use of Ubiquity to Determine Patent Eligibility
|Written by Marc Ehrlich, Marian Underweiser, Mark Ringes & Manny Schecter
Posted: July 31, 2014 @ 11:55 am
It has been over a month since the Supreme Court published its opinion in Alice v. CLS Bank. While the question on which certiorari was granted broadly considered the patent eligibility of computer implemented inventions, the Court ultimately issued an opinion that was tightly focused on the invention underlying Alice Corp’s patent. While many hoped that the Court would address this broader issue, the narrow opinion leaves many key questions unanswered. More importantly, the Court’s explanation of why the Alice patent was an ineligible abstract idea demonstrates the limitations inherent in applying that doctrine to computer implemented inventions. Those limitations will come to define the struggles confronting innovators, courts and the patent office as they attempt to operate in accordance with this opinion.
A review of the opinion and oral argument reveals that no participant was able to articulate a meaningful, repeatable, and predictable approach for determining which computer implemented inventions are too abstract and which are eligible for patent protection. The Court intentionally declined to broadly address this key issue: “[i]n any event we need not labor to delimit the precise contours of the “abstract ideas” exception in this case.” And that is because it cannot be done. As the Court itself acknowledged in Mayo v. Prometheus, “all inventions at some level embody” an abstract idea. And unlike laws of nature and natural phenomena, abstract ideas are not readily susceptible to line-drawing – where does the abstract idea stop and the eligible “application” of that abstraction begin?
Learned Hand lamented the intractable nature of this problem in the context of the idea expression dichotomy in copyright law. Struggling to separate the underlying unprotected idea from the copyright protected expression, he noted “…there is a point in this series of abstractions where they are no longer protected, since otherwise the playwright could prevent the use of his ‘ideas’, to which, apart from their expression, his property is never extended. Nobody has ever been able to fix that boundary, and nobody ever can.” See Nichols v. Universal Pictures Corporation.
Indeed, the same holds true for attempts to engage in a process of dissecting specific detailed computer implemented inventions to basic abstract ideas in patent cases, no one will ever be able to fix a boundary to determine patent eligibility. But while the purpose underlying the separation of idea from expression is clear from the language in the copyright statute, the separation of abstraction from invention is a judicially created rule which must be narrowly construed. While the Alice opinion acknowledged that the misapplication of this exclusionary principle could “swallow all of patent law,” unfortunately it did not lay out any of its contours beyond specific application to the patent in suit.
A troubling aspect of the analysis in the Alice opinion is the suggestion that an invention, once patent eligible, can become patent ineligible simply based on the passage of time and public adoption. Dialogue in the oral argument as well as statements in the Court’s opinion suggest this line of reasoning, which arguably originated in Bilski, has become an accepted principal. In one exchange during oral argument, CLS’s counsel contends that email and word processing software may have once been patent eligible but are now no longer patent eligible subject matter:
JUSTICE SOTOMAYOR: So you’re saying no to e-mail and word processing.
MR. PERRY: Your Honor, I think at a point —
JUSTICE SOTOMAYOR: They certainly have functionality and – and improvement of functionality for the user.
MR. PERRY: At a point in time in the past, I think both of those inventions would have been technological advances that were patentable.
JUSTICE SOTOMAYOR: How?
MR. PERRY: Today – because they would have provided a technological solution to a then unmet problem. Today, reciting, and do it on a word processor is no different than and do it on a typewriter or — and do it on a calculator.
The inventive contribution component, which uses specifically the language of conventional and routine and well understood, will evolve with technology. That’s why it’s different from the abstract idea component.
And here we know that these patents don’t claim anything that isn’t conventional, well understood and routine. We went through that in great detail and Alice has never disputed a word of it. They just say you’re not supposed to do that analysis, even though the Court, 9-0 in Mayo said we should…
Often oral arguments simply reflect the Justices’ process of deliberation, but unfortunately the Alice opinion suggests that this line of reasoning in fact is central to the Court’s view of the “contours” of the abstract idea exception. Finding the claims at issue were nothing more than the abstract idea of “intermediated settlement”, the Court explained that abstract ideas are not limited to pre-existing fundamental truths that exist in principle apart from any human activity, but instead include ideas invented by man such as “fundamental economic practices”:
Drawing on the presence of mathematical formulas in some of our abstract-ideas precedents, petitioner contends that the abstract-ideas category is confined to “pre-existing fundamental truth[s]” that “’exist in principle apart from any human action’” …Bilski belies petitioner’s assertion…Although hedging is a longstanding commercial practice … it is a method of organizing human activity, not a “truth” about the natural world “ ‘that has always existed’ “…
This language follows the line of argument presented by CLS counsel during oral argument. Under this test patent eligibility is time and adoption dependent. An invention may initially be susceptible to patenting but may later become ineligible for patenting (as opposed to becoming unpatentable due to lack of novelty or obviousness) as it becomes more adopted, ubiquitous, successful or commonplace. Ubiquity, it would seem, is now the touchstone not only for patentability but for patent eligibility too. While the current decision (and the Bilski decision) would appear to limit application of this doctrine to economic practices, the broadening language regarding organizing human activity suggests that it may find application beyond financial business methods.
Many commentators have expressed concern with the Court’s use of patentability considerations as part of its eligibility jurisprudence. But the Court’s above application of step 1 of its test from Mayo v. Prometheus (determine whether the claims are directed to one of the patent ineligible exceptions) to abstract ideas is deeply worrisome. Even assuming we know how to determine abstractness (which we do not), this approach raises numerous questions that must now be answered. A sampling of these questions includes those relating to the mechanics of implementing the test such as:
- How does one know when a practice has been in place long enough so as to be ineligible? Is the degree of adoption relevant? Are the considerations akin to those we normally associate with obviousness and the person having ordinary skill?
- What is to be the subject of such longstanding practice analysis? Is it the invention in question in a given patent case or is eligibility judged against one or more pioneering inventions?
- When is the longstanding nature of the abstract idea judged? Is it only relevant at the time the application was filed or can it be reconsidered later in the life of the patent?
- Does evidence of the longstanding practice need to be specifically identified or simply alleged?
- Does this approach to 101 which includes aspects of 102, 103 and 112, alter the application of those statutory sections?
- Must this abstract idea analysis “come first” before substantive patent examination under the other statutory sections (as the PTO guidance currently suggests), and if so how does this comport with compact prosecution and the statute?
From a policy perspective the opinion raises other challenging questions, for example:
- Is it in keeping with the policy underlying the judicially created exceptions to patent eligibility to extend the abstract idea exception past the envelope of the other judicially created exceptions which by definition relate to preexisting truths about the natural world? Are the man-made inventions behind these “abstract ideas” akin to the “the fundamental tools of scientific and technological work” discovered as laws of nature or physical phenomena?
- The Court has indicated that the presence of a mathematical algorithm holds no special significance in its abstract idea analysis. What boundaries if any does this analysis have? Is it limited to economic practices or are inventions like email and word processing susceptible?
- The Court has acknowledged that the misapplication of this judicially created exception to eligibility could “swallow all of patent law”. Does this application of that exception which relies on patentability considerations from other statutory sections to determine eligibility qualify as narrow? Is it consistent with Congressional intent?
- How do patent owners address the possibility that this ruling could result in the loss of patents long held eligible?
These and other questions left unanswered by this decision will generate uncertainty for innovators and their competitors as the lower courts and the patent office struggle to provide needed structure to this ruling.
Concurrent with this writing IBM is submitting a set of comments to the USPTO to assist in their implementation of examination guidelines consistent with the Alice opinion. The USPTO is charged in the first instance with applying the reasoning outlined by the Court in Alice, and is likely to review thousands of claims that raise eligibility issues before lower courts see even a handful. It is critical that the USPTO examine these applications with great care, avoiding an overbroad approach that as the Court noted, could “swallow all of patent law.” We are hopeful that our comments will help the USPTO provide focused structure to the abstract idea analysis. However, the narrow opinion of the Court and the questions presented by its eligibility analysis suggest that rather than moving toward greater clarity in the area of patent eligibility we will continue to struggle through yet another chapter of problematic patent eligibility tests.
About the Authors
Marc Ehrlich is Associate General Counsel for IBM Corp. He manages the patent licensing and sales legal team responsible for generating IP income for IBM.
Marian Underweiser is IBM’s Counsel for IP Law Strategy & Policy. Dr. Underweiser develops IBM’s policy on a broad spectrum of IP matters, including legislative, PTO, and judicial reform.
Mark Ringes is Vice President and Assistant General Counsel for IBM.
Manny Schecter is Chief Patent Counsel for IBM.
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