A Post-Alice Playbook: Practical Strategies for Responding to Alice-Based Rejections

By Robert Plotkin
October 7, 2014

Editorial Note: This article is a companion article to Software Patents are Only as Dead as Schrödinger’s Cat, which was published on Monday, October 6, 2014.

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How to manualAlthough the Supreme Court in Alice declined to provide an express definition of “abstract idea,” the opinion is packed with evidence that the Court intended for the term “abstract idea” to apply not to any “abstract idea” in the colloquial sense, but only more specifically to abstract ideas that are fundamental practices long prevalent in their fields. Furthermore, although the Court did not provide any direct guidance regarding how “long” a practice must be in use to be “fundamental” and “long prevalent,” the examples that it used have been in use for hundreds of years, if not longer. To put it into everyday language, the Supreme Court seems to think that an idea is only a patent ineligible abstract idea if it is really, really old and well-established.

Although I will leave it as an exercise for the reader to locate each and every bit of support for this interpretation of “abstract idea” in the Alice opinion, the following are representative:

  • Citing the Supreme Court’s previous decision in Bilski: “Hedging is a fundamental economic practice long prevalent in our system of commerce and taught in any introductory finance class.” Continuing: “‘The concept of hedging’ as recited by the claims in suit [in Bilski] was therefore a patent-ineligible ‘abstract idea, just like the algorithms at issue in Benson and Flook.’” The “therefore” in this passage indicates that the Supreme Court is asserting that it is the “long prevalence” of hedging which makes it an abstract idea. (The concept of a “hedge” as a mechanism for insuring oneself against a loss arose at least as long ago as the 1670s.)
  • “Like the risk hedging in Bilski, the concept of intermediated settlement is ‘‘a fundamental economic practice long prevalent in our system of commerce.’’” (As an example, banknotes were first issued in Sweden in 1861, and were preceded by promissory notes—that used an early form of “intermediated settlement”—used by the Tang Dynasty as far back as the 7th)
  • “The use of a third-party intermediary… is also a building block of the modern economy [and ancient economies]. … Thus, intermediated settlement, like hedging, is an ‘abstract idea’ beyond the scope of § 101.” Again, the Court’s use of “thus” here indicates that the Court infers intermediate settlement’s “abstract idea” status from the fact that it is a “building block of the modern economy.”

In short, although the Court did not provide a definition of “abstract idea,” its reasoning implies that it intended to limit the concept of “abstract ideas” to those concepts which are fundamental and long prevalent, possibly to concepts which have been well-known and extensively used for hundreds of years. An even more narrow, but very reasonable, interpretation of Alice, given the opinion’s strong emphasis on the risk hedging claims in Bilski, the “intermediated settlement” concept allegedly embodied in the claims at issue in Alice, and the repeated references to “economic practices,” “finance class,” “commerce,” and “the modern economy,” is that the Court intended for “abstract ideas” to be limited primarily or entirely to financial methods.

In light of this, an applicant faced with an Alice-based rejection that defines an abstract idea relatively narrowly as a concept that is relatively new and/or confined to a relatively specific technological field should argue that such an alleged abstract idea is not an “abstract idea” at all within the meaning of the Alice opinion. For example, if a rejection defines an abstract idea as a concept of relatively recent origin—by which I mean a concept that originated within the last 50 years or even more—such as automatic speech recognition, public key encryption, or online social networking, the applicant should argue that such an alleged abstract idea is not an “abstract idea” within the meaning of Alice because it is not a long-prevalent and fundamental practice, no matter how widespread, in comparison to the abstract ideas of risk-hedging and intermediated settlement relied upon by the Alice court, which have been in widespread use for many centuries throughout the world. For bonus points, argue that the examiner’s alleged abstract idea is not related to commerce or finance and therefore is not an “abstract idea” according to Alice.

 

In Response to a Broadly Defined Abstract Idea, Argue that the Claims Go Beyond Merely Reciting the Alleged Abstract Idea and Providing an Instruction to “Apply It”

Recall that, according to the Alice two step test, even if a claim is directed to an abstract idea, the claim is only patent ineligible if the claim elements fail to recite “significantly more” than the abstract idea, such that the claim as a whole merely recites the abstract idea and then merely provides an instruction to apply the abstract idea. Therefore, if an examiner defines the alleged abstract idea relatively abstractly, the applicant should argue that the claim is directed to significantly more than the alleged abstract idea, such as by pointing to express limitations (e.g., method steps) in the rejected claims which go beyond merely providing an instruction to apply the alleged abstract idea. For example, if the examiner defines the abstract idea in just a few words, and the claim includes several detailed method steps which cannot be inferred from the examiner’s definition of the abstract idea, this fact should be used in support of an argument that the claim does more than merely recite an abstract idea and provide an instruction to “apply it.”

The Alice Court’s treatment of Diamond v. Diehr is instructive in this regard. According to the Alice opinion, even though the claims in Diehr recited an abstract idea in the form of a well-known mathematical equation, the additional steps of feeding temperature measurements into a computer and then using the computer to repeatedly apply the formula to calculate the remaining cure time inside a rubber mold was sufficient to transform the patent ineligible formula into a patent eligible application of the formula. The Diehr example demonstrates that the “significantly more” requirement need not require much more than input of data and performance of repeated calculation of that data by a computer to transform a patent ineligible abstract idea into a patent eligible application of that idea. Many computer-related claims should satisfy the second step of the Alice test even more easily than the Diehr claims, if the Alice test is applied accurately and fairly.

 

A Claim Reciting a Generic Computer Implementation is not Patent Ineligible Unless the Claim Otherwise Fails the Alice Test

Perhaps the most significant collective misinterpretation of Alice is the notion that any claim which recites a method in terms of a generic computer implementation (e.g., a method performed by a generic computer processor and/or memory) is necessarily patent ineligible. Although many patent examiners seem to be issuing rejections based on this interpretation, the language of the Alice decision itself makes clear that this interpretation is not correct.

To understand why Alice does not hold that claims reciting generic computer implementations are inherently patent ineligible, it is useful to analyze carefully passages in the Alice opinion which might seem at first glance to imply that all claims must recite more than a generic computer implementation to be patent eligible, such as the following: “We hold that the claims at issue are drawn to the abstract idea of intermediated settlement, and that merely requiring generic computer implementation fails to transform that abstract idea into a patent-ineligible invention.”

This passage does not state that any claim that recites a generic computer implementation necessarily is patent ineligible, but only that if a claim has been determined to be drawn to an “abstract idea” as that term is used in the Alice opinion, then that particular claim cannot be made to be patent eligible merely by reciting a generic computer implementation in it.

Therefore, if a particular claim is not drawn to an “abstract idea” as that term is used in Alice—such as if the claim is not drawn to a fundamental and longstanding practice—then the Alice inquiry ends and the claim is not patent ineligible according to Alice, whether or not the claim recites a generic computer implementation. In other words, if a claim is not drawn to an “abstract idea” as that term is used in Alice, then the Alice test does not deem the claim to be patent ineligible—period. Nothing in the passage above (or anywhere else in Alice) implies that the presence of a generic computer implementation in such a claim would make the claim be patent ineligible. Therefore, adding a generic computer implementation to such a claim would result in a claim that both recites a generic computer implementation and which is patent eligible under Alice. As a result, Alice-based rejections which reject claims on the mere basis that the claim does not include any implementation details other than generic computer hardware (such as a generic processor and/or memory) are incorrect.

All of the other references in the Alice decision to generic computer implementations support the same conclusion. For example, the Alice Court’s conclusion that the particular claims at issue in Alice, “which merely require generic computer implementation, fail to transform [the] abstract idea of [intermediated settlement] into a patent-eligible invention” merely states that adding a generic computer implementation to a claim that has been determined to recite an “abstract idea” within the meaning of Alice cannot by itself make that abstract idea patent eligible, not that any claim which recites a generic computer implementation—even claims which are not drawn to an “abstract idea” within the meaning of Alice—necessarily are patent ineligible.

Nothing in any of these passages drawn from the decision removes or weakens the examiner’s burden to prove that a rejected claim is drawn to an “abstract idea” within the meaning of Alice. Any applicant faced with a rejection which asserts that a claim is patent ineligible merely because it recites a generic computer implementation should respond by pointing out that nothing in Alice announces a per se patent eligibility exclusion for claims reciting a generic computer implementation, and refocus the examiner on the fundamental two part requirement established by Alice that the examiner sustain the burden of proving that the claim is drawn to an “abstract idea” within the meaning of Alice and that the claim is not directed to significantly more than that abstract idea. The Alice Court’s reaffirmation of the patent eligibility of the claims in Diehr demonstrates that the “significantly more” requirement can be satisfied by generic computer hardware performing programmed method steps, thereby reinforcing the conclusion that the mere presence of a generic computer implementation in a claim does not necessarily render it patent ineligible.

 

Mix and Match: Your Mileage May Vary

The list of potential arguments contained in this article merely represents a starting point. Careful reading of the Alice decision certainly will reveal additional bases for traversing rejections under Alice. For example, Professor Donald Chisum has suggested that claims which are directed to a solution of a technological problem are not patent ineligible under Alice.

Furthermore, and it should go without saying that, any particular argument suggested herein may or may not be applicable to a particular claim rejection, and may or may not succeed in any particular case. My goal in presenting these arguments in “playbook” form is to make them available and ready for use, if and when applicable, with tailoring to the particular rejection at hand, and after due consideration based on the facts of each case, with an understanding that some of the arguments may not succeed all of the time, but with the intent of maximizing the extent to which the patent applicant community as a whole can encourage the USPTO to satisfy its burden of proof under Alice to the greatest extent possible in each and every patent application rejected by the USPTO under the auspices of the Alice opinion.

Some might argue that accepting the validity of the reasoning in Alice as the basis for arguments against Alice-based claim rejections is to concede defeat in the face of a decision that is not only founded on incoherent logic but also represents a step backward in relation to decades (at least) of precedent. To counter this objection, I would point out that applicants attempting to obtain patents to which they are entitled must take the law as they find it. The vast majority have neither the time to wait for the law to change nor the means to effect such a change. On the contrary, applicants must now accept the Alice decision as fact, even if not as justified fact.

Any steps that applicants can take in individual cases to require that the decisions rendered in those cases be fully substantiated by actual reference to the specific reasoning in the Alice decision and to the actual elements of the claims in those cases can only help in the effort to nudge the law back into harmony with the true first principles of patent law, even while other mutually supportive steps are taken in parallel to steer the courts and (dare I say it?) Congress back on course.

The Author

Robert Plotkin

Robert Plotkin  
Robert Plotkin, Esq. is a patent attorney specializing in patent protection for computer technology and the founder of the law firm of Robert Plotkin, P.C. He has obtained hundreds of patents on computer-related technology for clients in the U.S. and abroad, and frequently writes and speaks on the topic of software patents.

Plotkin is the author of The Genie in the Machine: How Computer-Automated Inventing is Revolutionizing Law and Business,(Stanford University Press, 2009). He has taught the “Software and the Law” course at the Boston University School of Law for six years and has been on the faculty at Massachusetts Continuing Legal Education (MCLE) and the Practising Law Institute.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 25 Comments comments.

  1. EG October 7, 2014 11:18 am

    Robert,

    Very interesting and useful thoughts, thanks. Another thought I’ve got for method claims s to, where possible, refer to “software” (further defined the patent specification as a “machine (computer)-implemented component) as carrying out/implementing at least some (if not all) of those method steps. It’s really hard to disqualify a “”machine (computer)-implemented component” that carries out the method steps as being merely an “abstract idea” under the (broken in my opinion) Alice test.

  2. Mark Nowotarski October 7, 2014 12:47 pm

    applicants attempting to obtain patents to which they are entitled must take the law as they find it.

    Great point.

  3. Paul Cole October 7, 2014 1:57 pm

    There are two significant points made at page 15 of the Slip Opinion:

    (1) 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.

    (2) Nor do they effect an improvement in any other technology or technical field. See, e.g., Diehr, 450 U. S., at 177–178.

    It follows that if an improvement in the computer e.g. by reduction in needed bandwidth or reduction in processing time can be demonstrated then it may be possible to avoid the rule in CLS. Alternatively if a technical improvement of some kind can be demonstrated the prohibition can be avoided.

    In the UK, the AT&T case has created signposts for patent-eligibility very much along the lines indicated by the Supreme Court:

    i) whether the claimed technical effect has a technical effect on a process which is carried on outside the computer;

    ii) whether the claimed technical effect operates at the level of the architecture of the computer; that is to say whether the effect is produced irrespective of the data being processed or the applications being run;

    iii) whether the claimed technical effect results in the computer being made to operate in a new way;

    iv) whether there is an increase in the speed or reliability of the computer;

    v) whether the perceived problem is overcome by the claimed invention as opposed to merely being circumvented.

    The EPO has a very extensive eligibility jurisprudence, especially as regards computer programs and business methods.

    If a US application and claims aqre written so that there is a reasonable prospect of a corresponding case being granted in UK or by the EPO, then there is a reasonable chance that the reasoning in CLS will be avoided. And as the profession has been alerted as to what to look for, the best way forward is to follow the guidance given by the Court.

  4. patent leather October 7, 2014 3:59 pm

    “Perhaps the most significant collective misinterpretation of Alice is the notion that any claim which recites a method in terms of a generic computer implementation (e.g., a method performed by a generic computer processor and/or memory) is necessarily patent ineligible. Although many patent examiners seem to be issuing rejections based on this interpretation, the language of the Alice decision itself makes clear that this interpretation is not correct.”

    Unfortunately, this is what many examiners currently think, although they admit they have been given little guidance (other than to reject all software for now). Until the Supreme Court clearly rules this way (I don’t think they will but anything is possible), it is not fair (and perhaps a violation of the ABA and Due Process clause) for the USPTO to be rejecting all software categorically.

  5. patent leather October 7, 2014 3:59 pm

    correction in #4, I meant to say “APA” not “ABA”

  6. Eric P. Mirabel October 7, 2014 4:53 pm

    These would be reasonable arguments for the Federal Circuit on appeal, or maybe the PTAB on appeal, but the Examiner’s are guided by the recent Alice interim guidelines and the MPEP. Arguing case law to them will most likely only succeed in making you look stupid — for not arguing the guidelines, and for assuming Examiners know or care about the nuances of these legal decisions.

  7. Joachim Martillo October 7, 2014 5:17 pm

    Hirshfeld’s preliminary guidance is clear.

    http://www.uspto.gov/patents/announce/alice_pec_25jun2014.pdf

    Just search for: Two-part Analysis for Abstract Ideas

    Rejecting a claim directed toward a statutory category of invention for involvement of an abstract idea without performing the two part test seems improper on the face as the examiner should realize if he took the time to read the guidance.

  8. Inside informant October 7, 2014 7:55 pm

    “In short, although the Court did not provide a definition of “abstract idea,” its reasoning implies that it intended to limit the concept of “abstract ideas” to those concepts which are fundamental and long prevalent, ”

    You need to read Benson before you make such an incorrect assertion of law in formal work. The abstract idea exception in Benson was not fundamental or old. And the exceptions for abstract ideas are not limited to that very narrow class of abstract ideas.

  9. Robert Plotkin October 7, 2014 10:20 pm

    I am referring to the Alice Court’s understanding of what constitutes an “abstract idea,” not the Benson Court’s understanding. Something clearly has shifted between the two cases.

  10. Joachim Martillo October 8, 2014 8:05 am

    SCOTUS has been quite consistent from Benson to Alice. In both cases SCOTUS threw out claims that were directed solely to analytic knowledge, which is how the nebulous legal concept of “abstract idea” is more precisely described in epistemology.

    The second part of the two-step test just checks whether the claim as a whole is directed toward synthetic knowledge.

    The drafter of the Benson patent understood the issue and tried to make it appear as if the claim were directed toward a device or circuit when in fact the claim could be exactly described with lambda calculus. In contrast the method claims of Diehr require a good deal more than lambda calculus to specify.

  11. Anon October 8, 2014 8:50 am

    Joachim,

    There is no credible way to say that SCOTUS has been quite consistent from Benson to Alice.

    None.

    To do so is to quite simply ignore reality. I invite you to re-read the series of cases and note which Justices (along with their philosophical proclivities) are on which side of the decisions.

  12. Anon2 October 8, 2014 10:07 am

    !!!!!!!
    Looks like the indicated author of this on the main blog page “Steven Brachman” is an error.

  13. Kevin R. October 8, 2014 10:11 am

    This first wave of 101 rejections was done rather haphazardly and will likely be withdrawn by (1) requesting that the examiners meet their burden of showing why the subj matter is abstract and (2) distinguishing the case law as to (a) this is not a fundamental principle like escrow and hedging and (b) even if it is, this claims that “something more.”

    Good post. Solid strategy and good aggregation of the schools of thought — time to go on the offense and force the PTO to define/list what is an “abstract idea.”

  14. Mark Nowotarski October 8, 2014 10:46 am

    Kevin,

    As a practical matter, I think you will find that once a 101 rejection is made, the burden shifts to the applicant to show that there is “something more”. The real question is “What is something more”?

  15. Gene Quinn October 8, 2014 11:26 am

    Anon2-

    Yes, my mistake. The author of this article is Robert Plotkin. I just made the change this morning.

    -Gene

  16. Gene Quinn October 8, 2014 11:31 am

    Inside informant-

    You are, of course, wrong. The Supreme Court has NEVER defined what it means to be an abstract idea. Not in Gotschalk v. Benson, not anywhere.

    What is interesting is that you take issue with a perfectly correct statement in an authoritative way, as if just saying it makes you correct. You are wrong.

    Furthermore, what was happening in Benson was not an abstract idea by any stretch of the imagination. It was a process that in a single context employed mathematical formulas. The process was NOT abstract. In fact, without that process computer couldn’t operate. Hard to imagine a more tangible innovation really. Still further, Benson was overruled by Diamond v. Diehr where in virtually the same factual context the software program that employed the Arrhenius equation was found to be patent eligible subject matter.

    Please do try and keep up. If you are going to so arrogantly state things it would be so helpful if you would endeavor to be correct.

    -Gene

  17. DU October 8, 2014 11:58 am

    Thank you, Gene, for posting these kinds of articles, and by keeping everyone straight.

    This is an EXCEPTIONAL article and call to action. The key point isn’t in the details, although they’re fantastic. Instead, the best part is the encouragement that all of us “wake up” and stand together. If we do this, we will see movement by the PTO (hopefully back in line with what’s right), and also best serve our clients and ourselves in both the short- and long-run. Thank you Gene and Robert Plotkin.

  18. Curious October 8, 2014 12:35 pm

    You are, of course, wrong. The Supreme Court has NEVER defined what it means to be an abstract idea. Not in Gotschalk v. Benson, not anywhere.
    Benson was a travesty of a decision — written by a judge with very questionable legal leanings (e.g., trees should have legal standing) and zero understanding of the technology. IMHO — the claims of Benson would sail through the USPTO today (well, they might have a little trouble with Alice but this is clearly a “technology” application).

    The court in Benson essentially stated that the invention was too broad and, hence, it was directed to an abstract idea (e.g., “Here the ‘process’ claim is so abstract and sweeping as to cover both known and unknown uses of the BCD to pure binary conversion”). The same could be said about a screw that is designed to hold together two pieces of wood. The same can be said about almost all technology — there will be applications of that technology that are unknown yet still covered by the claims.

    Consider this phrase:
    The mathematical formula involved here has no substantial practical application except in connection with a digital computer, which means that if the judgment below is affirmed, the patent would wholly pre-empt the mathematical formula and in practical effect would be a patent on the algorithm itself
    Practical effect? Practical effect? It seems that more than just “abstract ideas” are being excluded.

    Anybody wanting to practice the algorithm can do so without the use of the computer so it isn’t preempting use of the algorithm. The (alleged) fact that it is only useful in connection with a digital computer should have taken this out of the realm of “abstract idea.”

    While the Court states that it isn’t competent to speak on the policy matter as to whether software should be patentable, it chooses to repeat those policy arguments put forth as to why software shouldn’t be patentable — clearly aligning itself with those policy positions.

  19. t October 9, 2014 1:41 pm

    Having received several Alice rejections of late, none of which in my opinion fall into the “category” of purely economic activity, my bit of advice is write at least your first claim to (for the love of all things holy) avoid the 3600 art units.

  20. Curious October 10, 2014 10:10 am

    my bit of advice is write at least your first claim to (for the love of all things holy) avoid the 3600 art units
    LOL … I’ve been telling that to my clients (who have lots of attorneys drafting claims for them) for many, many years. The 3600 Tech Center is the armpit of the USPTO when it comes to following the law.

    Seriously, avoid using the terms “business,” “advertising,” “marketing,” or anything even clearly tied to “business methods” in your claims (or the specification if you can help it). There is absolutely no need to ever use the term “business” in a claim. However, a quick search of the USPTO database for published applications lists over 24000 applications that include a claim with the term “business” therein (12000 issued patents). Having your patent placed in the 3600 group all but guarantees at least one RCE and/or Appeal.

  21. Mark Nowotarski October 10, 2014 11:45 am

    Having your patent placed in the 3600 group all but guarantees at least one RCE and/or Appeal.

    Perhaps that’s true for the average case, but with proper preparation of the application and paying careful attention to an examiner’s concerns, you can get them issued quickly. At least that’s been my experience.

  22. Curious October 10, 2014 4:11 pm

    Perhaps that’s true for the average case, but with proper preparation of the application and paying careful attention to an examiner’s concerns, you can get them issued quickly. At least that’s been my experience.
    BTW — we are talking the business method side of 3600 — not the other stuff.

    I’ve stumbled upon at least two examiners (with considerable time at the USPTO) in the 3600 tech center that have essentially not allowed an application absent a reversal at the Board. If I’ve stumbled upon two, I definitely know there is more out there. Also, I have reviewed many prosecution histories with double digit office actions in the 3600 group.

    I’ve dealt with dozens and dozens of Examiners in the 3600 tech center and probably had a couple hundred applications in that tech center alone. There is no walk in the park there.

  23. Nobody123 October 26, 2014 9:39 pm

    Robert Plotkin, Esq. wrote” “the Court intended for the term “abstract idea” to apply… ONLY… to abstract ideas that are fundamental practices long prevalent in their fields… the Supreme Court seems to think that an idea is ONLY a patent ineligible abstract idea if it is really, really old and well-established.”

    Referencing the June 25th Memo:

    http://www.uspto.gov/patents/announce/alice_pec_25jun2014.pdf

    “Examples of abstract ideas referenced in Alice Corp. include:
    • Fundamental economic practices (1);
    • Certain methods of organizing human activities (2);
    • “[A]n idea of itself” 3; and,
    • Mathematical relationships/formulas 4.”

    The Memo does not appear to discuss “abstract ideas” being restricted to ONLY ” fundamental practices” that are “long prevalent in their fields”.

    What would you suggest to do to convince an(y) examiner that an “abstract idea” in the context of Alice should ONLY encompass “fundamental practices long prevalent in their fields”?

    Thank you.

  24. John November 14, 2014 7:40 am

    I have filed a non-provisional utility patent in 2011. My examiner has rejected my claims saying that it is an abstract idea with generic computer structure. Since Alice date was 2014, can the examiner use this rejection?

  25. Mark Nowotarski November 14, 2014 10:33 am

    John,

    Yes.