PTO releases abstract idea hypotheticals with examples of patent eligible claims

By Gene Quinn
January 27, 2015

Earlier today the United States Patent and Trademark Office released the promised patent eligible subject matter examples, which together with the recently released guidance will give applicants, patent prosecutors and patent examiners more information about how the USPTO interprets the state of the law in this all important area.

The USPTO guidance with respect to biotechnology has been much further along than its guidance with respect to computer implemented inventions, owing to the agency having had since the Supreme Court decided Mayo and Myriad in 2012 and 2013, respectively, to work on biotech guidance. Today marks the first time that the USPTO has released hypothetical examples relating to abstract ideas.

“We understand that examples are helpful, and we are going to continue to work on additional examples,” explained Drew Hirshfeld, Deputy Commissioner for Patent Examination Policy, in a telephone interview. “We are hoping people will comment on these examples during the open comment period. That would be helpful.”

Hirchfeld is referring to the open comment period where the public has been asked to provide feedback on the Interim Eligibility Guidance. To be ensured of consideration, written comments must be received on or before March 16, 2015. Comments should be sent by electronic mail message to: 2014_interim_ guidance@uspto.gov.

The guidance provided includes 8 different scenarios, 4 of which demonstrate patent eligible subject matter and 4 of which demonstrate patent ineligible subject matter. In one of the hypotheticals provided, the USPTO gives an example of patent eligible claims directed to both a computer implemented method and a computer readable medium. “This hypothetical is to show that not all software is an abstract idea,” Hirshfeld explained.

 

The Mayo Framework

Taking a step back for a minute, it is helpful to recall that in order to make sense of Supreme Court’s patent eligibility analysis, the so-called “Mayo framework,” the USPTO broke the decision making process into three steps. In the first step the USPTO instructed patent examiners to determine whether the claim is directed to a process, machine, manufacture or composition of matter. If the answer is NO, then the claim is not eligible subject matter. If the claim is directed to a statutory category of invention examiners are instructed to proceed to the next step, which is the first step of the two-part Mayo framework as announced by the Supreme Court.

If the claim is directed to a statutory category of invention the first Mayo inquiry requires determination of whether the claim is directed to a law of nature, natural phenomenon, or an abstract idea, which are collectively referred to as “judicial exceptions” to patent eligibility. The importance of the first two USPTO hypotheticals should not be apparent. The USPTO is informing applicants and examiners alike that it is possible to draft a claim to cover a software innovation that is NOT directed to an abstract idea. If a claim is not directed to an abstract idea, or other judicial exception to patent eligibility, the claim is patent eligible and the patent examiner should not proceed to the second prong of the Mayo two-step analysis.

 

The Hypotheticals

Hypothetical 1 provides an example technology that relates to software that isolates and removes malicious code from electronic messages. The USPTO provides basic background information about the technology, two independent claims, and analysis. The crux of the USPTO analysis and explanation why these claims are patent eligible is as follows:

The claim is directed towards physically isolating a received communication on a memory sector and extracting malicious code from that communication to create a sanitized communication in a new data file. Such action does not describe an abstract concept, or a concept similar to those found by the courts to be abstract, such as a fundamental economic practice, a method of organizing human activity, an idea itself (standing alone), or a mathematical relationship. In contrast, the invention claimed here is directed towards performing isolation and eradication of computer viruses, worms, and other malicious code, a concept inextricably tied to computer technology and distinct from the types of concepts found by the courts to be abstract. Accordingly, the claimed steps do not recite an abstract idea. Nor do they implicate any other judicial exception. Accordingly, the claim is not directed to any judicial exception (Step 2A: NO). The claim is eligible.

Hypothetical 2 is based on the DDR Holdings case, not surprisingly adopting the same reasoning of the Federal Circuit, explaining:

The claim does not recite a mathematical algorithm; nor does it recite a fundamental economic or longstanding commercial practice. The claim addresses a business challenge (retaining website visitors) that is particular to the Internet. The claimed invention differs from other claims found by the courts to recite abstract ideas in that it does not “merely recite the performance of some business practice known from the pre-Internet world along with the requirement to perform it on the Internet. Instead, the claimed solution is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.” No idea similar to those previously found by the courts to be abstract has been identified in the claim.

The hypothetical also specifically instructs examiners that if no abstract idea is identified “the claim should be deemed to be not directed to a judicial exception. The claim is eligible.” However, because the Federal Circuit also provided analysis under the second prong of the Mayo framework the USPTO likewise provided analysis as well.

Hypothetical 3 is based on Research Corporation Technologies v. Microsoft. The claims in this hypothetical were deemed to be directed to an abstract idea because the claims cover the mathematical operation of generating a blue noise mask. Notwithstanding, the claims are patent eligible because the claim recites additional elements that amount to “significantly more” than an abstract idea. The hypothetical explains:

[T]he steps recited in addition to the blue noise mask improve the functioning of the claimed computer itself… the claimed process with the improved blue noise mask allows the computer to use to less memory than required for prior masks, results in faster computation time without sacrificing the quality of the resulting image as occurred in prior processes, and produces an improved digital image.

The point of this hypothetical is to demonstrate that the “significantly more” prong of the inquiry can be satisfied by improvements to the functioning of a computer, for example, and that those improvements can be embodied in software. More specifically, when the terminology “improvements to the functioning of a computer” are used many might be lead to incorrectly believe those improvements must be tangible, or hardware based. It is possible, as hypothetical 3 demonstrates, to have “significantly more” when the improvement is based in software. “Software can improve the functioning of a computer and be significantly more,” explained Hirshfeld. “It would satisfy the significantly more prong if it improves the functioning of the computer itself.”

Hypothetical 4 is based on SiRF Technology Inc. v. International Trade Commission. Again, this hypothetical provides an example of claims that are determined to be directed to an abstract idea, but which are still nevertheless patent eligible. The claims contain additional elements that amount to significantly more than the abstract idea because they show an improvement to another technology or field.

With respect to hypothetical 4, the USPTO explains that “computer components are recited at a high level of generality and add no more to the claimed invention than the components that perform basic mathematical calculation functions routinely provided by a general purpose computer.” This, of course, without more is not sufficient to satisfy the patent eligibility test. The USPTO, however, explains:

[T]he claim is further limited to a mobile device comprising a GPS receiver, microprocessor, wireless communication transceiver and a display that receives satellite data, calculates pseudo-ranges, wirelessly transmits the calculated pseudo-ranges to the server, receives location data from the server, and displays a visual representation of the received calculated absolute position from the server. The programmed CPU acts in concert with the recited features of the mobile device to enable the mobile device to determine and display its absolute position through interaction with a remote server and multiple remote satellites. The meaningful limitations placed upon the application of the claimed mathematical operations show that the claim is not directed to performing mathematical operations on a computer alone. Rather, the combination of elements impose meaningful limits in that the mathematical operations are applied to improve an existing technology (global positioning) by improving the signal-acquisition sensitivity of the receiver to extend the usefulness of the technology into weak-signal environments and providing the location information for display on the mobile device. All of these features, especially when viewed in combination, amount to significantly more than the judicial exception.

This 4th hypothetical is quite important. In many situations software claims have contained only very generalized recitation of computer components because the computer components themselves are not what will make the invention unique. What will make the invention unique in the software space are the processes that run on the computer components. In this example we learn that generalized recitation of computer components is not the death knell of software claims provided that they impose meaningful limitations on operations to improve existing technology. That means that the operations cannot merely occur on a generalized computer alone, but the claims must also incorporate specific reference to an integral existing technology.

Part Two of the hypothetical examples contains 4 examples where the claims would not be patent eligible. These hypotheticals are based on (1) Digitech Image Tec v. Electronics for Imaging; (2) Planet Bingo v. VKGS; (3) buySAFE v. Google; and (4) Ultramercial v. Hulu and WildTangent. By far, the most interesting of these is the last, relating to Ultramercial, which to me simply cannot be reconciled with the Federal Circuit’s holding in DDR Holdings.

In Ultramercial the invention related to a method for addressing problems associated with piracy of digital copyrighted media. The invention was directed to distributing products covered by copyright over a telecommunications network by allowing a consumer to choose to view or interact with a sponsor’s message in exchange for access to copyrighted material. In DDR Holdings the Federal Circuit explained that the invention had no real world analog and was only possible because of the Internet, which dramatically influenced the panel’s decision. Similarly, in Ultramercial, the invention cannot exist outside of an Internet environment, and the preamble to claim 1 even specifically limited the scope of the claim to “distribution of products over the Internet…”

The USPTO explains that the claims in Ultramercial do not satisfy the significantly more prong of the Mayo framework. The hypothetical concludes:

Viewing the limitations as a combination, the claim simply instructs the practitioner to implement the concept of using advertising as an exchange or currency with routine, conventional activity specified at a high level of generality in a particular technological environment. When viewed either as individual limitations or as an ordered combination, the claim as a whole does not add significantly more to the abstract idea of using advertising as an exchange or currency (Step 2B: NO). The claim is not patent eligible.

 

Conclusion

The examples provided by the USPTO should be extremely helpful to everyone involved in the prosecution of software patent applications. The hope is that patent examiners will start to follow the guidelines and implement these hypotheticals. Examiners are still being trained on the guidance, which is why the USPTO says that some examiners are not applying the guidelines as they are directed to do so. Those familiar with the industry know that the problem runs significantly deeper. Senior management at the USPTO is not the problem. Over the past 6 years the USPTO has continually disseminated even-handed guidance that provide examples of what is and should be patentable. In many instances there are examiners who simply refuse to follow instructions. In at least some instances those examiners take great pride in the fact that they refuse to follow instructions, telling patent attorneys that they have no intention of following guidance. Time will tell whether the USPTO can get examiners on the same philosophical page.

The Author

Gene Quinn

Gene Quinn is a Patent Attorney and Editor and founder of IPWatchdog.com. Gene is also a principal lecturer in the PLI Patent Bar Review Course and an attorney with Widerman Malek. Gene’s specialty is in the area of strategic patent consulting, patent application drafting and patent prosecution. He consults with attorneys facing peculiar procedural issues at the Patent Office, advises investors and executives on patent law changes and pending litigation matters, and works with start-up businesses throughout the United States and around the world, primarily dealing with software and computer related innovations. is admitted to practice law in New Hampshire, is a Registered Patent Attorney and is also admitted to practice before the United States Court of Appeals for the Federal Circuit. CLICK HERE to send Gene a message.

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 17 Comments comments.

  1. Curious January 27, 2015 1:18 pm

    Uh … USPTO … we are capable of reading Federal Circuit caw law.

    Thanks for nothing.

  2. Gene Quinn January 27, 2015 2:25 pm

    Curious-

    I don’t agree with you. If you look at the first hypothetical it is not based on a Federal Circuit case. It quite clearly shows that computer implemented method and computer medium claims are not always abstract ideas.

    The benefit of having this from the USPTO is that patent examiners would never rely on the Federal Circuit. While much of what is here comes from the Federal Circuit there is now something that patent attorneys can use to persuade examiners in a way that a Federal Circuit decision alone never could. Examiners doing their jobs follow what the PTO tells them is the proper interpretation of the cases, so I do think this will be helpful.

    -Gene

  3. Anon January 27, 2015 2:51 pm

    Only half jesting, but when did Congress change the law and insert a technological arts test into 101?

    This notion that software must effect an improvement in the functioning of the computer itself seems to be overly broad. I would accept that as a mere non-limiting example of patent eligible material, but would not go further than that.

    It appears to invite confusion as to what “software” is. Software cannot “be an abstract idea, because in important part, software is not an idea to begin with. It it critical to hold fast to the distinction between the idea of software (like the idea of anything, which as an idea may merely be an abstract idea), and non-abstract reality of real software.

    The entire hocus-pocus game remains as long as you can have something meet a reality based statutory category and yet be deemed to be “abstract.”

    One clear problem with the Office guidance based on case law that has not yet been seen by the Supreme Court is the mirror of the pre-1952 Supreme Court adage: “the only valid claim is one that has not yet appeared before us.”

    Until, (or perhaps better put as “If”) the Supreme Court can clearly, objectively, and without engaging in futuristic speculative thinking, enunciate and consolidate its own disparate case law, anything coming out of the executive branch is necessarily incomplete and internally inconsistent – basically because that is how the Supreme Court case law is.

  4. SN January 27, 2015 4:26 pm

    Most of the Examiners are not attorneys and only look at case law that filters in through the MPEP or via USPTO memos. Thus, the USPTO hypotheticals are very useful because they help guide the Examiners.

  5. Curious January 27, 2015 5:08 pm

    If you look at the first hypothetical it is not based on a Federal Circuit case. It quite clearly shows that computer implemented method and computer medium claims are not always abstract ideas
    My apologies, after looking at examples 2 through 8, I forgot about 1 (then again, I rarely deal with encryption or anything analogous so it wasn’t too important). Also, with DDR Holdings, we already knew that a computer implemented method isn’t always an abstract idea — I would posit that a plain reading of Alice would have never suggested otherwise.

    The benefit of having this from the USPTO is that patent examiners would never rely on the Federal Circuit.
    Not entirely true, but if it was true (and it may be in certain instances), it is a sad state of affairs at the USPTO if Examiners don’t recognize controlling precedent. That would say much more about USPTO management than the Examiners themselves.

    Only half jesting, but when did Congress change the law and insert a technological arts test into 101?
    One could ask a similar question about the Court’s analysis in Benson. The abstract idea jurisprudence was essentially concocted out of thin air.

    This notion that software must effect an improvement in the functioning of the computer itself seems to be overly broad.
    By some appearances, it seems that the USPTO has developed a special utility test. It isn’t enough that the invention is useful, it has to be useful within a certain scope (e.g., improve the functioning of a computer). If the utility is a better way to order takeout food or predict weather, that might not cut it.

  6. Gene Quinn January 27, 2015 6:35 pm

    Curious-

    Examiners have never recognized controlling precedent (or they aren’t supposed to at least). Many, if not most, aren’t lawyers. They are supposed apply the interpretation of precedent provided in the MPEP and in the guidance documents that come out between MPEP revisions.

    I hear what you are saying about what we knew from DDR Holdings, but the USPTO is embracing that ruling rather than treating it like an outlier, which I do think is a good thing.

  7. sss January 27, 2015 7:09 pm

    the courts analysis of ultracommercial makes no logical sense because most websites and web-related invention don’t exist outside of the internet environment and yet patents from facebook and google are still being granted?

  8. Curious January 28, 2015 12:47 am

    Gene — The following is a response to both your points. This is from Koninklijke Philips v. Cardiac Science, but similar statements can be found throughout Federal Circuit decisions:

    In 1997, we explained that it “does not accept the PTO’s statement that it can `administratively set aside the judicially created rule of In re Spina.’ Judicial precedent is as binding on administrative agencies as are statutes.” Rowe, 112 F.3d at 479 n. 2. We remind the district court and the Board that they must follow judicial precedent instead of 37 C.F.R. § 41.200(b) when a party challenges another’s written description during an interference proceeding because the PTO lacks the substantive rulemaking authority to administratively set aside judicial precedent.

    Put simply, neither the USPTO nor an Examiner can disregard Federal Circuit precedent. They have no choice in the matter.

  9. step backs January 28, 2015 3:11 am

    Anon @3

    That is no jesting matter.
    Congress did not legislate a new section 101.

    Nowhere in the Congressionally-legislated section 101 is there any language saying, “all of the foregoing being nice and good but first an examiner at the USPTO shall arbitrarily, capriciously, whimsically and regardless of what the inventor regards as the invention, determine an abstract idea that each claim is directed to and shall arbitrarily, capriciously, whimsically and regardless of what the specification says, determine that there is an indefinite, something significantly more needed for transforming the claim from mere abstraction to patent eligible content”.

    SCOTUS legislated that additional language.
    Despite the “fact” that the US Constitution mandates that the legislative power shall vest exclusively with the Congress.

    No jesting matter.
    Serious stuff for what few serious men remain in this has-been nation of ours.

  10. step back January 28, 2015 3:21 am

    Curious @8:

    Congress is the baby mamma of the USPTO.

    Congress gave life, meaning and power to the USPTO through the black and white statutes that Congress passed. See something called Title 35 of the US Code.

    The USPTO owes its existence and its allegiance to Congress and not to the judicial branch of our tripartite form of federalist government.

    On any given day any whacko judge (or panel of 9 or 11 such persons) can say any whacko thing he or she arbitrarily and capriciously decides to say. Judges are not bound by the Administrative Procedure Act (see a thing called Title 5 of the US Code). The USPTO is.

  11. American Cowboy January 28, 2015 9:08 am

    Part of the problem of is Scotus’s insistence on ignoring words that “the draftsman’s art” puts into a claim to make sure that the claim is limited to statutory subject matter.

    One can only conclude that Scotus has a grudge against patent practitioners and wants to make our lives as difficult at possible.

  12. Abstract Idea January 28, 2015 11:15 am

    It’s a start…
    I would have liked to see more of a straight up “business methods” example. Also, in the Guidance, the examples of what is considered ‘significantly more’ for patent elibigility is presented as a non-exclusive or non-limiting list. I would like to have seen an example that is considered patent-eligible because it possesses the “something more” but that is not one of those examples. If the USPTO can’t (or won’t) think of any, then that list effectively becomes exclusive and limiting.

  13. patent leather January 28, 2015 4:34 pm

    Planet Bingo was nonprecedential and (I think) would have come out differently depending upon the panel. It shouldn’t have been included in these examples. I think the PB example is in tension with some of the examples of eligible claims. The examples are also not clear on when something would qualify as an abstract idea. for example, example #4 is an abstract idea (but rescued by “something more”) where example #1 is not abstract. I think example #4 should not be labeled an abstract idea for the same reasons #1 is not abstract. I realize these things are subjective and could be argued either way.

    Anyway, at least the USPTO is not giving a blanket no to software. As Gene states, this is good material to work with examiners (try to amend your claims like one of the four eligible examples and then point to this USPTO guidance). I’ve been advising clients subject to 101 rejections to wait as long as possible (including paying extension fees) until we get some more guidance from the USPTO, and I think at least now we have something to work with.

  14. sss January 28, 2015 9:47 pm

    to allow this kind of subjective interpretation will simply result in more chaos, conflict and perhaps corruption.

  15. David Stein February 5, 2015 1:38 am

    @Gene, the examples link is now dead – probably because the USPTO seems to have gone live with its site update (the beta site is now the main site).

    Looks like the new site may be a slightly-out-of-date version of the old site. The new site has a page for the Interim Guidance:

    http://www.uspto.gov/patent/laws-and-regulations/examination-policy/2014-interim-guidance-subject-matter-eligibility

    …but it now reads: “COMING SOON: Abstract Idea Examples” – not hyperlinked.

    You don’t happen to have a new link, do you?

  16. Leander Aulisio March 4, 2015 3:28 pm

    Every invention begins with an abstract idea.

  17. Saint Cad May 20, 2015 9:55 pm

    I just pulled the hypotheticals off at http://www.uspto.gov/patents/law/exam/abstract_idea_examples.pdf

    I think it is clear that the people evaluating these claims have no clue how computers work.

    #1 We see constantly in the ineligible claims that simply tying the process to the general functions of computers e.g. storing data, performing mathematical functions, etc. is insufficient. Same with number #1 because all it is realing doing is setting up storage areas and rewriting some data. But OMG it deals with viruses and worms! And since this computer stuff clearly the computer in a fundamental part of the process. Eligible! I can almost see what they’re getting at but it seems very similar to the analogy of “That invention carves wood. Wood is natural so ineligible. This invention carves plastic and since the plastic is an integral part of the invention … eligible, In other words, they focused on what the invention acts on rather than the invention itself.
    #2 & 8: So advertizing something and having the customer get more information on the product is not a general business practice because internet BUT requiring someone to read an advertisement before looking at copyrighted products is a general business practice (and seriously, have you ever been required to read a pamphlet before reading a book at the library?) despite internet although it is interesting that based on how the webpage is written it can require you to watch the advertisement and completely prevent you from accessing the material you want to see until you do.

    The rest: It seems that the general rule is that if you are simply using the computer to make the process quicker or easier it is ineligible, but if your process impacts the computer in some way then it is eligible. So in effect the output of the process is immaterial.