Posts Tagged: "patentability requirements"

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. Schecter would go on to say that we are at a point where a legislative fix seems necessary.

Versata presented four questions to the Supreme Court, some very specific to CBM proceedings. In its amicus brief, Broadband iTV more generally asks the Supreme Court to revisit its patent-eligibility precedents, and clarify how computer-implemented claims can be found patent-eligible under Alice to correct the ongoing misapplication of Alice in the lower courts and by the PTAB. Since Alice, more than 100 patents and thousands of claims have been declared invalid under 35 U.S.C. § 101 by the lower courts or PTAB using an overly broad interpretation of Alice. Thus, it is important for this Court to take up the issue of patent-eligibility once again and right the course.

The District Court’s errors in the Broadband iTV decision are a paradigmatic and telling manifestation of certain of the manners in which district courts are misapplying the two-step Alice test in order to invalidate patents, creating something of a fait accompli at the outset of the filing of an Alice motion. Most notable is the alarming trend of certain district court Section 101 Alice invalidations that purport to resolve questions of law but that, upon closer scrutiny, only nominally invoke Section 101 to improperly sidestep the work of Sections 102, 103 and 112 of the Patent Act. The problem in so-doing is that district courts are utilizing the summary legal analysis permissible under Section 101 when, in fact, they should be undertaking the factually-intensive analysis required by Sections 102, 103 and 112. This sleight of hand has resulted in what is becoming a systematic invalidation of patents on a far lesser “legal” showing rather than the rigorous factual showing mandated by the Patent Act.

Rather than use the word ‘conflate’ to describe the mongrel mixture of patentability requirements the Supreme Court undertook in Mayo, the Eli Lilly brief characterizes the analysis employed by the Supreme Court as including a separate, implicit ‘threshold test’ for patentability that is applied even before consideration of the statutory patentability requirements. Eli Lilly hypothesizes that this ‘implicit exception was imposed to assure that patents cannot validly protect—or preempt access to—laws of nature, natural phenomena, or abstract ideas.’

The Court held that dealing “physical playing cards” did not constitute patent eligible territory. This constituted a “purely conventional” activity, like the conventional computer implementation that fell short in Alice. The Court found there was no inventive concept sufficient to transform the subject matter into a patent-eligible application of an abstract idea.

This is as straightforward a certiorari candidate as any patent case can be. It is manifestly important: A host of judges and amici have stressed that the result below is untenable— invalidating previously irreproachable inventions and precipitating what Judge Lourie called “a crisis of patent law and medial innovation.” And this is the vehicle this Court needs to provide that clarification: Every opinion below agrees that this case tests Mayo’s uncertain limits by invalidating an otherwise plainly meritorious invention. Here, unlike Mayo, every intuition points towards patent-eligibility. And yet the Federal Circuit felt compelled by Mayo to condemn this meritorious patent—and, a fortiori, the patents underlying an entire, vital field of American healthcare innovation.

As we await the next Update from the Patent Office on subject matter eligibility, it may be worthwhile to consider further the role of examples given in the past by the PTO. The Patent Office’s July 2015 Update on Subject Matter Eligibility. Although examples of this sort can be helpful and are appreciated, they are not enough! In the Internet and computer arts, the existing examples offer limited use. The PTO has released only a few examples in the computer fields still, and in general they express fairly obvious points, such as the point that improvements to the computer itself remain eligible.

The Supreme Court’s own precedents provide overwhelming authority for interpreting § 101 broadly and, conversely, interpreting its judicial exceptions to § 101 narrowly. These precedents provide ample support for the Cluster Argument: (1) observing that the term “abstract idea” constitutes a legal term of art that, according to stare decisis, properly refers to looped mathematical algorithms and old and fundamental business practices and (2) declining to expand the set of “abstract ideas” beyond these two clusters without a signal from Congress.

A patent is a proprietary right granted by the Federal government pursuant to laws passed by Congress. The Congressional power to authorize patents is found in Article I, Section 8, Clause 8, of the United States Constitution. exclusive rights are provided for a limited time as an incentive to inventors, entrepreneurs and corporations to engage in research and development, to spend the time, energy and capital resources necessary to create useful inventions; which will hopefully have a positive effect on society through the introduction of new products and processes of manufacture into the economy, including life saving treatments and cures. See Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 480 (1974).

Although categorizing abstract ideas could be helpful, the use of categories expands the risk of overbreadth, especially when the categories have little definition, include sub-categories, and lack negative examples. The PTO should refine the categories of “judicial descriptors,” and do so both negatively and positively, to avoid overbroad application of Alice by examiners. The use of “judicial descriptors” not supported adequately by court decisions has the potential to do great mischief in the area in which I practice frequently, i.e., software and Internet-related patent applications.

Addressing the problem would be responsive to the overwhelming bulk of commenters who expressed opinions on the PTO’s most recent July 2015 Update on Subject Matter Eligibility (Section 101), who have agreed that the PTO has been applying Alice too vigorously and has been making more rejections than warranted, and that the excess rejections are reflected in the statistics. Examiners would welcome such efforts, because they would better know whether and when to make Alice-type abstract idea rejections under Section 101, in contrast with current guidance, which allow them to find reasons to make such rejections in virtually all cases. A more systematic approach to consideration of such rejections might look like this…

It is poor patent policy to have broad areas of technology deemed patent-ineligible entirely, or ineligible without the high cost of attorney time to argue, and likely appeal, amorphous Alice-type rejections. This is particularly so as to technology that is central to the United States economy. Invention is central to U.S. economic might, and as our economy moves away from the “old line” manufacturing strength of the past, the U.S. has become especially strong in fields dependent on software technology and business methods. Strengths of the current U.S. economy include social media, the Internet, and the service economy, especially financial services. We are also strong in biotech. Yet those are precisely the fields most heavily damaged by Section 101 Alice-type rejections.

A case currently pending before the Federal Circuit is anticipated to provide greater guidance into the answer to this question, namely, how district courts should determine whether a claim is directed to an abstract idea. The case, McRo, Inc. v. Bandai Namco Games America, No. 2015-1080, recently heard oral argument on December 11, 2015. The panel’s questioning indicated that its anticipated decision may provide greater insight into how district courts are to determine whether a claim is, in fact, directed to an abstract idea. The patents are directed to automatic three-dimensional lip-synchronization for animated characters. Whereas prior art lip-synchronization required manually synchronizing an animated character’s lips and facial expressions to specific phonemes, the patents are directed to rules for automating that process.

This year our panel has a diverse variety of wishes. We see the usual wishes relating to patent eligibility and the abstract idea exception, with a reference to a Moody Blue’s song to make the point. We also see wishes relating to inter partes review (IPR) and the biotech industry, and a wish for uniformity at the Federal Circuit. There is a wish for federal trade secret legislation to finally pass, and a reminder that elections matter, even for us in the intellectual property space, a topic that we will return to quite a lot during 2016 here at IPWatchdog.com. We also see several exasperated wishes, hoping for solutions to the real problems facing the industry rather than the same old tired cries for “reform” that would benefit only a handful of large entities while harming practically everyone else.

If Gene (the “genie”) were to grant me patent and IP wishes for 2016, I would ask for (in no particular order) the passage of trade secrets legislation, resolution of the current patent reform legislation stalemate in Congress, that the USPTO consider evidence of non-preemption during its initial determination of patent eligibility; and that the USPTO prioritize accuracy, completeness and accessibility of the public record as part of its Patent Quality Review.