“While the guidance on patent eligibility issued by former USPTO Director Andrei Iancu has been helpful, it has not resulted in the necessary predictability or consistency because a) it is not binding on the courts and b) USPTO examiners do not always apply the guidance consistently, said the report.”
The U.S. Patent and Trademark Office (USPTO) has published its study on patent eligibility jurisprudence in response to a March 2021 request from Senators Thom Tillis (R-NC), Mazie Hirono (D-HI), Tom Cotton (R-AR) and Chris Coons (D-DE). The study, titled “Patent eligible subject matter: Public views on the current jurisprudence in the United States,” is based on more than 140 comments received following a USPTO request of July 9, 2021, and unsurprisingly concluded that many (mostly larger) high-tech and computer-related companies like the current state of the law; life sciences, startups and SMEs do not; but everyone agrees that consistency, clarity and predictability are needed. The study did not make any recommendations, and indicated that the Office will be continuing to solicit feedback via listening sessions and written comments and that it is also broadening the scope of stakeholders it reaches out to.
In their March letter to then-Interim Director of the USPTO, Drew Hirshfeld, the senators expressed concern about the state of patent eligibility jurisprudence, saying it has resulted in “a lack of consistency and clarity” in patent eligibility law. They said that, in order for the United States to continue leading in technology sectors such as quantum computing, artificial intelligence, 5G, the internet of things, biopharmaceuticals, precision medicine, and life sciences, “we can no longer continue to ignore the fact that current eligibility jurisprudence has had a dramatic negative impact on investment, research, and innovation.” The letter continued:
The lack of clarity has not only discouraged investment in critical emerging technologies, but also led the courts to foreclose protection entirely for certain important inventions in the diagnostics, biopharmaceutical, and life sciences industries.
The senators specifically called for data on how cases like Alice Corp. v. CLS Bank International and Mayo Collaborative Services Inc. v. Prometheus Laboratories Inc. have “adversely impacted investment and innovation in critical technologies like quantum computing, artificial intelligence, precision medicine, diagnostic methods, and pharmaceutical treatments.”
The Comments are In
The 140+ comments received represented the following broad categories of stakeholders, according to the report:
- 43 comments from associations, nonprofit entities, and other advocacy groups;
• 21 comments from companies and businesses;
• 16 comments from law firms and practitioners;
• 9 comments from academics, healthcare institutions, and universities; and
• 34 comments from individuals, including inventors and patent applicants, and other entities that did not fit one of the aforementioned categories.
The Pros: Patent Law is A-Ok
Of those who weighed in to say that the current state of the law is sufficiently clear, the report cited commenters including the American Civil Liberties Union (ACLU), the High-Tech Inventors Alliance (HTIA), the Intellectual Property Owners Association (IPO), the Sofware & Information Industry Association (SIIA) and the Computer & Communications Industry Association (CCIA), among others. Claims made by those commenters included that the Federal Circuit affirms ineligibility decisions by district courts and the USPTO at a high rate; that applications are rejected for lack of eligibility at about the same rate post-Alice as prior; and that the Supreme Court’s decisions in Alice and Mayo have improved predictability and help to foster scientific research and innovation. They also said the new jurisprudence has encouraged better quality applications.
The Cons: It’s Past Time for a Fix
However, the section on those who feel the law is unclear and unpredictable was about twice as long as the section on those who approve of it, and included citations to the comments of IBM, The App Association, the American Intellectual Property Law Association (AIPLA), the New York Intellectual Property Law Association (NYIPLA), U.S. Startups & Inventors for Jobs (USIJ), AUTM and Innovation Alliance, among others. These commenters explained that the Alice–Mayo test for determining patent eligibility is unworkable because it relies on subjective reasoning and often results in “arbitrary determination[s]”; that the Federal Circuit judges themselves have written that they “are ‘at a loss’ as to how to apply section 101,” have literally “begged the Supreme Court and Congress to provide more clarity” and have referred to the law as having “destabilized technologic development in…all fields”; and that the trajectory of Section 101 law promises to even further destabilize things as we still await decisions in cases such as American Axle and in light of other cases such as Yu v. Apple, Inc.
While the guidance on patent eligibility issued by former USPTO Director Andrei Iancu has been helpful, it has not resulted in the necessary predictability or consistency because a) it is not binding on the courts and b) USPTO examiners do not always apply the guidance consistently, said the report. The latter issue has made prosecution very art unit dependent, said commenters. The Public Interest Patent Law Institute (PIPLI) further claimed that “there is… evidence that the revised guidance is leading to the allowance of patent claims that are ineligible under Alice.”
Little Common Ground
The report further outlines the varying comments as they pertain to “Impacts on innovation, investment, and competition”, “Impacts on legal costs”, “Impacts on access to technical information”, “U.S. global leadership and national security implications”, and “Impacts on technology-specific sectors”. The views in each of these areas almost universally contradict one another based on whether one is for or against the current state of U.S. eligibility law. For example, those in favor of the current jurisprudence said that the law promotes innovation by curbing patents on “basic ideas” and providing more access to information while those against the current state of the law argue it has jeopardized the ability to innovate in certain key areas, including precision medicine, pharmaceutical treatments and diagnostics. Those who are happy with the current law also said litigation costs have been reduced, while those who want changes say it has increased costs.
The technology sectors that have been most affected by the jurisprudence are 1) Life sciences (diagnostics, precision medicine and gene-based technologies); 2) Computer-related technologies (AI, quantum computing and machine learning); and Mechanical and future technologies. Many commenters in these areas noted that they are no longer seeking patent protection and are instead turning to trade secrets.
About the only thing the commenters agreed on was that certainty is important to a functioning patent system.
Commenting on the report, USPTO Director Kathi Vidal said: “Innovation cannot thrive in uncertainty. We are committed to making every effort to ensure that the U.S. patent system is as clear and consistent as possible. We are analyzing our own patent eligibility guidance put in place in 2019, implementing the pilot program for deferred examination of patent eligibility, and considering guidance on functional claiming.”
Updated June 29, 2022 to clarify that not all high-tech and computer-related industries were in favor of current patent eligibility jurisprudence.
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