Posts Tagged: "§ 101"

Several weeks ago, the Court of Appeals for the Federal Circuit issued a nonprecedential decision in Glasswall Solutions Limited v. Clearswift Ltd., affirming a district court’s findings that claims from two patents that were asserted in an infringement case filed by Glasswall were directed to unpatentable subject matter under 35 U.S.C. § 101… The Federal Circuit found that testimony offered by an expert witness for Glasswall didn’t preclude a dismissal on the pleadings as the alleged factual assertions in that testimony weren’t actually factual in nature but, rather, were conclusory legal arguments the district court wasn’t bound to accept as true.

The Supreme Court has brazenly admitted it is not following Congress’ statutory instructions on patent eligibility in several cases. And it has carried out virtually none of the required statutory construction. It is judicial activism in the extreme… [I]t is hard to imagine a more unconstitutional statement than that discoveries cannot be patented when the statute the Court is applying states that any invention or discovery can be patented.

The examiner concluded the claims were directed to the abstract idea of rules for playing a game, which fell within the realm of methods of organizing human activities. The examiner further found the claims were unpatentable as obviousness over old and well known to dice games, applying the printed matter doctrine… Marco also contended that its claimed method of playing a dice game could not be an abstract idea because it recites a physical game with physical steps. The Court rejected this argument “because the abstract idea exception does not turn solely on whether the claimed invention comprises physical versus mental steps.” Since the only arguably unconventional aspect of the recited method of playing a dice game was found to be printed matter, thus falling outside the scope of § 101, the rejected claims did not recite an “inventive concept” sufficient to “transform” the claimed subject matter into a patent-eligible application of the abstract idea.

Obtaining a U.S. software patent is still harder than it was five years ago, but studying these “lighthouse” cases can improve one’s chances of success. While the Federal Circuit’s decision in Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018) and the USPTO’s guidance to patent examiners on the Berkheimer decision have recently improved the landscape for software patents, the following cases contain critical lessons for drafters that can further ensure claims are patent eligible.

Judge Rich was attempting to articulate a test that would allow the decision maker to determine whether there is in fact an innovation; an invention that we recognize as one that can and should be patented if it is in fact novel and nonobvious. So, the key to the “useful, concrete and tangible result” test of State Street is the “concrete and tangible” part of the test. That part of the test must be referring to whether an invention has been articulated sufficiently so that if it is novel and nonobvious a patent could be appropriately awarded. This explanation of the State Street test would be in accord with both the Supreme Court’s decision in Bilski, as well as in Alice v. CLS Bank, as well as the Federal Circuit’s precedential decisions in which the Court discusses the need for an inventive concept under Alice/Mayo Step 2B, and particularly the Ancora Technologies, Inc. decision.

In essence, by narrowly identifying certain subject matter groups as being those that properly qualify for characterization as abstract ideas the USPTO is effectively defining what is and what is not an abstract idea, thereby filling a void intentionally left ambiguous by both the Supreme Court and the Federal Circuit. It has been frustrating — to say the least — that courts have refused to define the term abstract idea despite that being the critical term in the Supreme Court’s extra-statutory patent eligibility test. Without a definition for the term abstract idea rulings have been nothing short of subjective; some would even say arbitrary and capricious.

As we look ahead towards 2019, it is worth reflecting on several high-profile patent cases and brewing developments from the past year. Here are five lessons we learned from 2018 that may be useful in developing IP litigation strategies in 2019.

The U.S. Supreme Court has muddied the waters about patent eligibility in a way that threatens American innovation.  Capitol Hill is beginning to discuss this as a possible legislative issue for 2019.  Some would say it is as important as the intellectual property disputes in the tariff war with China… Intellectual property legislation traditionally is nonpartisan, which may make it a little easier to find a solution.  All members of Congress will support preserving the patent system’s incentives for innovation if they understand what is at stake for the country.

In Berkheimer and Aatrix, the Federal Circuit indicated that although patent eligibility under Section 101 is ultimately a question of law, the determination may have factual underpinnings that, at least in some cases, render it inappropriate for motions to dismiss or for summary judgment… However, following Berkheimer and Aatrix, the Federal Circuit has itself affirmed numerous Section 101 rulings that were made at the dismissal or pleadings stage. This article provides a summary of recent district court decisions granting Rule 12(b)(6) motions to dismiss under Section 101.

Director Iancu’s remarks gave a first look at what his reforms will look like, and by all indications these changes will be extremely innovator friendly… What has made the quartet of patent eligibility cases so devastating is how they have been stretched and pulled, twisted and manipulated to invalidate (and prevent) patent claims on innovations of entirely different magnitudes than those contemplated by the Supreme Court. Director Iancu understands that what the Supreme Court has actually said is quite limited. Director Iancu proposes that the USPTO strictly follow the Supreme Court, and nothing more.

Artificial intelligence technologies are transforming industries and improving human productivity and health. Unfortunately, the stark reality appears to be that artificial intelligence technologies are likely to be more heavily scrutinized under 35 U.S.C. § 101 and less likely to be allowed… The Court in Electric Power Group made note that: “we have treated analyzing information by steps people go through in their minds, or by mathematical algorithms, without more, as essentially mental processes within the abstract-idea category”.  The authors propose that this sentence of the decision is of utmost importance in the context of patenting A.I. technology.

This particular Rule 36 patent eligibility loss for the patent owner came in Digital Media Technologies, Inc. v. Netflix, Inc., et al., affirmed the district court’s finding that patent claims asserted by Digital Media against Netflix, Amazon and Hulu were invalid under 35 U.S.C. § 101 because they were directed to an abstract idea… Using Rule 36 in an area of the law as unstable, chaotic and unpredictable as patent eligibility is irresponsible. Whether the decision would be the same or not, the parties and the public have a right to have the Federal Circuit make sense ‘this § 101 conundrum.’

At the beginning of this decade the United States Supreme Court embarked on a path that would ultimately result in a significant re-writing of the law of patent eligibility in America. While this Supreme Court first became intrigued with patent eligibility in Bilski v. Kappos in 2010, it wasn’t until Mayo v. Prometheus (2012), AMP v. Myriad (2013) and Alice v. CLS Bank (2014) that the law became a chaotic mess that no longer resembled the well-established view of patent eligibility that dates back to at least the 1952 Patent Act… Is this Supreme Court really content with the subjective, extra-statutory test they have foisted upon the industry while changing the law? Does the Supreme Court even appreciate the chaos they have created?

REAL argued in its petition that step two of the Alice test used to determine invalidity under Section 101 requires questions of fact that were never asked by the lower court. To invalidate without asking those questions contradicts the Federal Circuit’s recent holdings in Berkheimer v. HP and Aatrix Software v. Green Shades Software. REAL’s appeal to the Federal Circuit was decided by a panel including Circuit Judges Alan Lourie, Evan Wallach and Kara Stoll, a trio where the majority has held that step two of Alice is a pure question of law, which is a misapplication of the Alice standard. REAL further contended that both the district court and the Federal Circuit disregarded the factual record in their Alice analysis; that the patents-in-suit claim patentable improvements to computer user interface technology; and that the district court found that there were material facts in dispute while also finding that the claims were well-understood, routine and conventional.