What should we do about Alice?

By Gene Quinn
April 21, 2016

questions-businessman-umbrella-335On Tuesday morning, April 19, 2016, Manny Schecter, who is IBM’s chief patent counsel, gave a keynote presentation at the Innography Insights 2016 conference in Austin, Texas. The title of his presentation was simple and straightforward: What should we do about Alice?

Although most of Schecter’s presentation was on defining the problems presented by Alice, he ended saying he thinks we are at a point where we need a legislative fix to 101. I tend to agree.

Showing a bowl of spaghetti on one of his first few PowerPoint slides set the tone. The law as it applies to software patent eligibility is a tangled mess. “The Supreme Court has continually taken cases in this area and rather than clarify they have continued to hang on,” Schecter explained referencing the fact that the Supreme Court seems committed to the belief that their 101 jurisprudence is consistent and reconcilable. Of course, that is not the case. “There are too many cases that conflict with each other.” He is right.

Indeed, Judge Richard Linn of the Federal Circuit told me the same thing in an interview in the Fall of 2014, saying: “I have great difficulty rationalizing the Supreme Court’s opinions in Flook and Diehr, and in many regards I think those decisions are irreconcilably in conflict.” That conversation I had with Judge Linn was after the Supreme Court’s Alice decision, but before many in the industry were willing to accept just how challenging the Alice decision would become.

According to Schecter, since Alice, some 65.75% of patents challenged in the district courts have been invalidated under 101, with the success rate even worse at the Federal Circuit. Since Alice 91% of patents have been invalidated under 101 at the Federal Circuit, with the Court’s decision in DDR Holdings representing the sole case where a patent eligible computer implemented invention was found to exist.

During his presentation Schecter lamented a point I have frequently brought up myself – the lack of a definition for the term “abstract idea.” I have asked this simple question repeatedly: How is it fair under our system of laws to have a doctrine that is used to strip away property rights when the key term within that doctrine isn’t defined?

“I would say [the Supreme Court] didn’t tell us what it means because they can’t, so they punted it to the lower courts. This has been going on for decades,” Schecter explained. Once again, Schecter is right. The Supreme Court has created judicial exceptions to patent eligibility even though there is not even the most remote hint in the statute that the courts have the authority to create any exceptions. Nevertheless, one of those judicial exceptions says that you cannot patent an abstract idea. In Alice the Supreme Court took another step down the abstraction path by proclaiming that a patent could still be obtained if there is something significantly more at the heart of the claim than merely that abstract idea.

For Schecter this leads to a critical important question: “How can you know if there is something more than something that is significantly abstract if you don’t know what it means to be abstract?” A very good question! Obviously, you cannot evaluate a patent claim with this undefined, circular Supreme Court test. “It would be great if you could [evaluate a claim with this test], but you just can’t,” Schecter told the audience.

In Alice the Supreme Court did seem at least somewhat cognizant of the fact that they were embarking upon a path that risked swallowing patent law whole, after all, every invention starts with an idea. The Supreme Court cautioned against allowing that to happen, but the test they conceived, lacking definition and unbounded by earthly logic, seemed to do the exactly opposite, if you ask me.

“They are looking for a light touch here,” said Schecter, “they just don’t know how to do it.” And that might be one of the most accurate, and pithy, observations about Alice I’ve ever heard. It seems unlikely that even the Supreme Court wanted to effectively rule that software is not patent eligible, but for all intents and purposes that seems to be the practical effect of the fall out of the Alice decision, at least for a lot of pockets of computer implemented innovation.

Schecter said that when he first read Alice he didn’t really think it was that bad, which is something I’ve heard from many patent attorneys. Over time he has come to think it is quite bad based on how it is being implemented and how the test is completely unpredictable. “If you read the case the Supreme Court seems to think that software must be patentable, but the problem is they gave us a test that doesn’t lead to that being the case.”

Some will quibble with the suggestion that software is not patentable, because software is still patented. Whether those patents will remain patentable when challenged is another story. Still, trying to be objective Schecter acknowledged the alternative view. He explained that according to Bart Eppenauer, computer implemented inventions that have a technical aspect are upheld two-thirds of the time in district courts when challenged under 101. Assuming that is true, “that still means that one-third of patents in the computer implemented innovation area that clearly have a technical aspect are being found patent ineligible, which is simply too far over shooting the mark,” Schecter explained.

The problems Alice has created are many, but Schecter highlighted several in particular.

“Does it strike you as odd that an invention could start its life as something that is patent eligible and then become so popular that it is no longer patent eligible? That doesn’t make sense to me.” This subject of ubiquity is one that Schecter has written about before, including an article on IPWatchdog.com titled Abstraction in the Commonplace: The Use of Ubiquity to Determine Patent Eligibility. Indeed, it does seem that the more commonplace an invention is at the time it is challenged the more likely it will be viewed by Judges as being patent ineligible. Rather than appreciating how extraordinarily difficult it may have been to bring the invention into being at the time of original innovation the fact that there is widespread infringement almost seems to suggest to some that the invention isn’t particularly worth protecting. That seems exactly backwards to me. If ubiquity can be used to demonstrate an invention is patent ineligible then that means widespread infringement of groundbreaking innovations becomes a silver bullet defense. How can massive and unprecedented infringement be a legitimate (or intellectually honest) defense to a charge of infringement? Unfortunately, that does seem to be where we are today.

Another problem Schecter pointed to the fact that Judges and patent examiners are doing exactly what the law prohibits them from doing, which is cherry picking words from claims rather than interpreting the claim as a whole. “Judges and examiners are pulling a few words out of the claims and saying the claim covers a concept that is abstract,” said Schecter. “They are also applying hindsight.” To drill this point home Schecter relied on Thales Visionix v. USA and Elbit Systems, which dealt with a system for tracking the motion of an object relative to a moving reference frame and is used for a helmet-mounted display system and an F-35 fighter jet. The Court of Claims found the claims patent ineligible because they said the claims were abstract and not specifically limited to use with a helmet-mounted display and an F-35 fighter jet. While the claims may not have been so limited in the specific language of the claims, what is abundantly clear is that the claims did not cover an abstract idea despite what the Court of Claims ruled. The claims specifically required two different sensors and an orientation relative to a moving reference frame. So as much as many might like for this claim to be abstract is just isn’t. I’ve said it before and I’ll say it again – how can a claim that specifically incorporates tangible components be found to be abstract? In my mind decisions like this are intellectually bankrupt. Clearly sensors exist, they are not imaginary, they are not abstract, we know what they are and the claims are not limitless. But again, this is what passes for thoughtful judicial decision making in the Alice generation thanks to a wholly unworkable test courtesy of the Supreme Court.

How did we get here? “We’ve made computers so easy to use that we’ve convinced the courts that the inventions that go into making computers easy to use aren’t worthy of patents,” Schecter explained. He would go on to say that these inventions are not easy to create, and many of them do deserve to be patented, themes of his recent op-ed article published in re/code titled The Downside of Making Innovation Look Easy.

So where do we go from here? Schecter thinks it may be time to get serious about the need for Congress to step in with a legislative fix to 101. Although former USPTO Director David Kappos has reportedly recently called for 101 to be abolished; Schecter told the audience he didn’t think we have to go that far. “We could just amend it to fix this problem, I don’t think we necessarily have to abolish it.”

“We are at the point where I think we need legislation,” Schecter explained. “This is a golden goose industry… don’t let the courts mess it up.”

I tend to agree with Schecter. The Supreme Court has embarked on a clearly anti-patent trajectory over the last five years, and the Federal Circuit seems unwilling (or perhaps just unable) to muster the energy to apply the Mayo-Alice framework with an eye toward the subtleties each new innovation requires. Instead, the Federal Circuit, and consequently the overwhelming number of district courts, seem to be channeling the Supreme Court and striking down patents with alarming frequency, grossly over applying the abstract idea doctrine to find things that are clearly not abstract to somehow still be abstract within the meaning of the undefined doctrine set forth by the Supreme Court.

Over the next few months we will learn whether the Federal Circuit will be willing to find truly innovative computer implemented innovations patent eligible or whether we have a de facto rule that software is patent ineligible. If the Federal Circuit does not change course soon the only option will be a legislative fix to 101 despite the risk that will bring and the reality that new legislation doesn’t guarantee the Supreme Court will follow the law any more than they do now.

The Author

Gene Quinn

Gene Quinn is a Patent Attorney and Editor and President & CEO ofIPWatchdog, Inc.. Gene founded IPWatchdog.com in 1999. Gene is also a principal lecturer in the PLI Patent Bar Review Course and Of Counsel to the law firm of Berenato & White, LLC. 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 26 Comments comments.

  1. EG April 21, 2016 10:27 am

    Hey Gene,

    Especially if SCOTUS doesn’t accept Sequenom’s petition or rules adversely to Sequenom, it’s definitely time for Congress to come and rein in this unprincipled usurpation by SCOTUS of is patent-eligible under 35 USC 101.

  2. Night Writer April 21, 2016 11:51 am

    I still think that Alice is a holding that it is unconstitutional to grant a patent to an abstract idea where abstract idea is defined by the procedure in Alice. Legislation cannot overrule this.

  3. JNG April 21, 2016 12:16 pm

    Good article Gene, one comment, you write:

    “The Supreme Court has created judicial exceptions to patent eligibility even though there is not even the most remote hint in the statute that the courts have the authority to create any exceptions.”

    Therein lies the problem with trying to eradicate 101. It doesn’t matter if it is there or not, because the Supremes have said there are “judicial exceptions” no matter what the statute says. Getting rid of 101 would simply remove all the safe harbors and give them even more latitude to make up the law.

    The biggest problem we have is a shortage of IP knowledge on the Court. They pretend to be conscious of the the whole statutory framework, but they miss basic things like the interplay or differences between 101/102/112, etc. Hell, they can’t even remember section 100, which specifically says that a new use of an old machine is eligible for protection.

    And then you have the District Courts taking advantage of this knowledge gap, taking what was really a throw-away comment in Alice (this is just like hedging in Bilski) and inventing a whole new doctrine out of thin air to help clear up their overloaded dockets.

    This is not going to go away until the CAFC grows a backbone and starts defending its turf and the rights of inventors as it was deputized to do 30+ years ago. Instead of leading the way, they’ve become passive complicit enablers of the destruction of thousands of otherwise valid patents. Its a disgrace. Let them draw the line, and let the SCOTUS take their best shot.

  4. Night Writer April 21, 2016 1:04 pm

    @3: I strongly recommend at this point abolishing the Fed. Cir. Try to re-start it with judges that weren’t selected by Google.

  5. Gene Quinn April 21, 2016 1:26 pm

    JNG-

    Yes, that is a huge problem. I do think we desperately need a legislative fix, but Marty Goetz is also correct in his article earlier today when he says that don’t think just because there is a legislative fix that anything will change.

    If there is a legislative fix the legislative history needs to be clear — that it is being done to overrule SCOTUS. That, of course, won’t be enough though. The statute needs to be clear — 101 would need to be amended to expressly forbid the current and any future judicial exceptions to patent eligibility. A statutory fix that does not explicitly state that the courts shall not find any judicial exceptions to 101 wouldn’t be worthwhile. SCOTUS will do whatever they want. After all, when it comes to patents they are just like the emperor with no clothes.

    -Gene

  6. Stephan Curry April 21, 2016 1:33 pm

    Night Writer@4

    this patent chaos started because the outside patent attorneys of google did not teach google on how to be a “good” behaving patent client, and eventually they also did not get the future billion dollars per year of billable work from alphabet/google corporate work. so here we are now, in a patent meltdown. case in point, Limbach did a great job in guiding National Semiconductor, and so we had decades of stability in the Valley. Larry Sonsini taught HP how to be a good patent client. etc. etc.

  7. step back April 21, 2016 1:44 pm

    Steph@6

    I think the pain medications for your ankle are getting to your head.
    What exactly are you saying?

    Dropping names of Silicon Valley notables does not exactly convey any sensible message to the large pool of readers out there. Not everyone is familiar with the ghosts of the Valley (i.e. Limbach).

    BTW, will you be playing tomorrow?

  8. step back April 21, 2016 1:53 pm

    On the Bigger question of what to do about Alice (and about Bilski, Mayo and Myriad) I think some here place too much hope on the intelligence of our modern crop of Congresscritters.

    These are not your grandfather’s representatives, Not well educated and deeply thoughtful gentlemen (and women). More like high times tea party and 4/20 revelers. Don’t expect any better from them than what we get from the geriatrics of our highest bench.

    Regrettably, I believe we have re-entered the Dark Ages.

    Your average Joe (and that includes Biden and other denizens of DC) believes in magic and wizards, warlocks and Philosophy Stones. Yeah, Let’s do a “moonshot” on them there cancers. Let’s “make it so” over the weekend on our geriatric computing box. Easier yet, let’s just stop in at the local iComputer store and get an app for that. There’s an app for everything and anything. Yahoo! Problems solved.

  9. Stephan Curry April 21, 2016 1:53 pm

    step back@7
    my ankle is busted, man, so Harrison and Thompson and Iggy/Dray better step up.

    I am glad you are amused.
    other folks here like Benny (short for Benjamin) are all pissed off about expositions of some truths on this pro-infringer Patent Reform movement that hoodwinked the drug industry and is making the software industry and entreprenuers/inventors go through some sufferings.

  10. Night Writer April 21, 2016 4:16 pm

    step back@7 & Stephan Curry: Actually, step back Larry Ellison said something very similar to this about Google. But, let’s fact it—think about Google. Their ability to present things that aren’t theirs to other people makes them money. They don’t want IP. That isn’t their game.

  11. Night Writer April 21, 2016 4:19 pm

    @5 Gene: I guess you can ignore what I am saying, but I am pretty sure the holding of Alice is that it is unconstitutional to grant a patent to an abstract idea. It would be interesting to see what the SCOTUS does if Congress expressly overturned Alice.

    If it is not a holding that abstract ideas are unconstitutional, then what is Alice based on? The judicial exceptions must be based on some authority of the SCOTUS.

  12. Anon April 21, 2016 4:44 pm

    Patent law appeals are not a matter of original jurisdiction for the Supreme Court, and Congress could thus strip the review of patent law cases from the Supreme Court (as long as some Article III court has jurisdiction).

    It is abundantly clear to this writer (and has been for some time), that that is the only way forward.

  13. nat scientist April 21, 2016 4:52 pm

    To avoid releasing all the evils of the human fear of disruption by invention cum innovation upon humanity, it would be better that the Hope in Pandora’s jar would contain the power to restrict the word “ABSTRACT” to the Trademark portion of the USPTO exclusively.

    According to the myth, Pandora opened a jar (pithos), in modern accounts sometimes mistranslated as “Pandora’s box” (see below), releasing all the evils of humanity—although the particular evils, aside from plagues and diseases, are not specified in detail by Hesiod—leaving only Hope inside once she had closed it again.[6]

    The Pandora myth is a kind of theodicy, addressing the question of why there is evil in the world.

    https://en.wikipedia.org/wiki/Pandora

  14. Appearance of ... April 21, 2016 4:56 pm

    I’m wondering if a “sense of congress” resolution urging SCOTUS to keep their hands off of 35 USC 101, would be useful here. This could summarize the issues, point out the logical inconsistencies of the SCOTUS decisions, and also discuss the damage to the economy. This would avoid the food fight that would almost certainly accompany making any changes to 35 USC 101.

  15. Ternary April 22, 2016 9:46 am

    Much of this mess has its origins in the mis-interpretation of the role of mathematics in digital devices. It is often assumed that mathematical models are merely abstract descriptions of reality. That time has long gone since the sampling theorem of Shannon.

    In the Thales case the court holds that “… the solution lies in the mathematical formulae, not the generic devices listed in the system claim.”

    But this is a wrong interpretation of the role of math and computers. The computers in Thales, combined with sensors, transform a basically abstract idea (like an exercise in a physics class) to a very useful and concrete device.

    One can imagine that Thales’ invention could perhaps be realized by a complex system of gyroscopes, sensors, gimbals and motors and thus be more of an “steam-punk” patentable device. However, through the application of an executable mathematical model, enabled by Shannon’s sampling theorem, the computer creates a physical device that is indistinguishable from a purely mechanical device, besides that it is better than a purely mechanical device.

    The Courts have it backwards. Computers actually transform abstract mathematical models into real physical devices. And I agree fully that Congress should intervene to bring the patent system into the digital age, rather than having us draft “steam-punk” claims that hide the core of the invention.

  16. step back April 22, 2016 1:18 pm

    Ternary @15

    The courts not only have it backwards.
    The courts are backwards … in their thinking that your average everyday geriatric’s “generic computer” operates just like the human “mind” and thus a claim restricting use of computer technology also restricts free thinking.

    The biological organ known as the human brain does not operate just like an electronic digital computer. For one thing the brain has emotions. For another, it forgets. It makes irrational decisions. It doesn’t consistently follow the same program every time.

    This morning however, the court did get it right in the case of In re Brown because the claims (which arguably include a mathematical algorithm) read on a human hair stylist merely thinking that way and then cutting the hair with scissors.

    On the other hand, had the claims been crafted to define a mechanical robot doing something similar, that would be different.

    http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/15-1852.Opinion.4-20-2016.1.PDF

  17. Night Writer April 22, 2016 3:30 pm

    You know, the real question is how can we get this to happen? The money keeps pouring in from Google to weaken the patent system.

  18. American Cowboy April 22, 2016 5:48 pm

    OK, ladies and gentlemen, let’s draft what the section 101 amendment needs to look like. Maybe we can come up with something to propose to our Congresspersons.

    Here is the existing 101: 35 U.S.C. 101 Inventions patentable.
    Whoever 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.

    Here is a first crack at amending it:

    35 U.S.C. 101 Inventions patentable.

    Whoever invents or discovers any useful process, machine, manufacture, or composition of matter, or any useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title, and those conditions and requirements shall be the sole criteria for patentability of useful processes, machines, manufactures, compositions of matter or improvements thereof.

    I have not figured out how to show additions/deletions in this comment box, so here is what I did: I took out “new and” (both instances) and added “and those conditions and requirements shall be the sole criteria for patentability of useful processes, machines, manufactures, compositions of matter or improvements thereof.”

  19. nat scientist April 23, 2016 11:54 pm

    @17
    There’s a lot more than just money going in the door from Google.

    There’s a great photo of Obama waving through the Google logo and a demonstration of a whole lot of showing up:

    see

    https://theintercept.com/2016/04/22/googles-remarkably-close-relationship-with-the-obama-white-house-in-two-charts/

    Woody Allen and experience teaches that
    ‘Showing up is 80 percent of life.’

    http://quoteinvestigator.com/2013/06/10/showing-up/

  20. Night Writer April 25, 2016 10:09 am

    Give her a pill to make her small?

  21. Simon Elliott April 25, 2016 5:55 pm

    When it couldnt come up with its own definitions and guidelines, it made sense for SCOTUS to punt the difficult questions to the lower courts. What troubles me is for SCOTUS to come roaring back 30 years later, completely rewrite the law, and blame the Federal Circuit for going the “wrong” way. After SCOTUS decided Chakrabarty in the 1980s, we saw a boom in molecular biology and genetics. Entirely new industries. Then in the 2010s SCOTUS decides that DNA is not patentable, without any concern that this was contrary to everything that the PTO and courts had being saying for decades, contrary to international practice, without any concern for the billions of sunk investment, and without evidence that the political process had failed.

  22. Anon April 25, 2016 8:30 pm

    Night Writer @ 20: follow the advice of the doormouse – feed her head….

    Simon @ 21 – I have an even more fundamental problem with the thrust of your post: it is not up to the Court to write patent law. Period.

  23. step back April 26, 2016 12:55 pm

    Simon @21

    What Anon said at 22. SCOTUS is not authorized to write laws n the first place.

    Jefferson Airplane, a “head” of their times.

  24. AntiAlice April 27, 2016 2:57 pm

    In my opinion, no 101 eligibility test should apply to issued claims. Congress should do away with such nonsense altogether. It would put the onus on the PTO to issue better claims and remove a mountain of doubt from the process that serves only to dilute the incentive for innovators to leverage the patent system. As for the two part Alice test, what test? Alice is incredibly vague and utterly devoid of objectivity that it shouldn’t be taken seriously during prosecution let alone post issuance of claims. It’s sole purpose is to tip the scale in favor of infringers once again. Too much Troll cool-aid drinking going on.

  25. Maxrevz July 21, 2016 2:04 pm

    Alice (or Obviousness 2.0 as I call it) is a travesty the likes of which the American patent system has never experienced. “How do we fix Alice?” We begin by eliminating the 101 eligibility test post issuance. This would put the onus on the PTO to issue better claims and help ensure that the commitments that the federal government makes to inventors when they issue claims remain intact.

    Alice is in direct conflict with the 103 and 102 tests that resulted in the issuance of the claims in the first place. The courts are clearly struggling with this as can be seen in the recent Bascom v. At&t decision. The Fed Circuit explained that the district court conflated obviousness with patent eligibility in this case and that when this is done the Alice test becomes even more subjective. “More subjective,” seriously is that even possible?

    It’s time to call Alice what it is, a scheme born by lobbyists working in Washington on behalf of gross infringers to ensure that they get away with it. Alice dilutes the incentive for innovators to use the patent system. Therefore, it is anti-innovation. I’m an inventor, not a lawyer if you haven’t guessed by now.

  26. Maxrevz July 21, 2016 3:12 pm

    Gene, thank you once again for another great article on Alice. I believe that you are making a difference. Please keep it up.

    I don’t think that Alice is about killing all software patents, it’s much worse. It is yet another scheme born by political influence to keep the pendulum swinging in favor of infringers. Each swing gives patent owners hope, but really it’s an effective way to clear court dockets for many years while limiting damages as the patents lucky enough to make it are enforceable for less time. Alice is a travesty. Congress must step in with a legitimate fix. I agree with David Kappos, kill 101 at least post issuance.