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Our Take on the USPTO’s Recent October 2019 Patent Eligibility Guidance
Last month the USPTO published the October 2019 Update to its January 2019 Revised Patent Subject Matter Eligibility Guidance (January 2019 PEG). Even though there has been much commentary and analysis on this Update, as expected given that applicants, inventors, and their attorneys all crave more concrete guidance from the patent office in this rapidly changing area of law, the bottom line is that no significant changes were made to the prior January publication.
Nevertheless, here is a breakdown of the five topics from the PTO’s October Update.
I. Evaluating whether a claim recites a judicial exception at step 2A Prong One
The gist of this first theme is that the claim can “recite” a judicial exception to patent eligibility – laws of nature, natural phenomena, or abstract ideas – in two ways – either explicitly stating it or by describing the exception without an explicit recitation. In either case, step 2A can be met. Practically, the Examiner is looking if the claim includes a judicial exception before deciding that a patent eligibility rejection should be made. Here, applicants should be cautious when putting mathematical formulas, basic scientific principles or very broad functional language in their claims, all which will trigger Examiners to find an issue at step 2A.
II. The groupings of abstract ideas enumerated in the 2019 PEG
The Update attempts to further clarify the categories of “abstract ideas,” which have been described as the “three M’s of – math, money and mental steps”:
“Mathematical Concepts” are defined and specific examples are discussed. For instance, the Arrhenius equation (Diamond v. Diehr) falls under both “Mathematical Relationships” and “Mathematical Formulas or Equations”. “Mathematical Calculations” is a third subcategory.
“Certain Methods of Organizing Human Activity,” such as financial methods, are clarified further and various real examples not found in the MPEP are provided such as local processing of payments for remotely purchased goods-Inventor Holdings, LLC c. Bed Bath & Beyond, Inc.; 876 F.3d 1372, 1378-79 (Fed. Cir. 2017) which falls under the Fundamental Economic Practices or Principles grouping.
“Mental Processes” are defined as concepts performed in the human mind including observations, evaluations, judgments, and opinions. Examiners are expected to consider the broadest reasonable interpretation of the claim in light of the specification, and even if the claims require a computer, the abstract concepts that the computer handles are to be examined.
Essentially, these judicial exceptions fall under the scope of math, behavior, or observation/evaluation, and methods reciting such concepts must be accompanied by additional elements that “integrate the judicial exception into a practical application” (Prong 2 of Step 2A).
III. Evaluating whether a judicial exception is integrated into a practical application at step 2A Prong Two
The Update provides further details for examination under step 2A, Prong Two. Under Prong Two, the claim is examined to determine if it recites additional elements that integrate the judicial exception into a patent-eligible practical application. The Update states that the practical application must be described in the specification such that one skilled in the art would recognize it as an improvement as asserted in the claim.
Essentially the take away from all of this is whether the claimed invention integrates the judicial exception (i.e. the law of nature, natural phenomenon, or abstract idea) into a practical, concrete application. Here, the specification of the patent can be very helpful or harmful. A well-written specification will make clear how the purported invention that might otherwise have an eligibility problem has solved a problem or is an advancement in the field of endeavor. A specification that lacks any description of the import of the purported invention, will more likely be found not to have converted the patent ineligible material into an invention.
IV. Requirements of a Prima Facie Case
The Update provides instruction for rejection under Step 2B for claims determined to be judicial exceptions under Step 2A. Specifically, the examiner is instructed to identify the judicial exception and explain why it is a judicial exception. Secondly, it should be evaluated whether or not there are any additional elements in the claim beyond the judicial exception. Finally, the examiner should explain why the additional elements as a whole do not amount to significantly more than the exception.
Translation: Examiners are cautioned against giving a conclusory § 101 rejection. Unfortunately, this is something that happens far too often. In replying to office actions, we can argue that the rejection is conclusory as a preliminary defense that the rejection is procedurally improper.
V. Application of the 2019 PEG in the Patent Examining Corps
The Update also describes how the PTO is training Examiners on the use of the latest Update. Specifically, the examining corps was trained on the 2019 PEG in January-February 2019. Appeals to the PTAB cannot have the basis of failure by USPTO personnel to follow the 2019 PEG. Rather, the applicant may, relying upon the guidance in the 2019 PEG, appeal that his or her rejection under § 101 is in error.
The PTO also provided four new hypothetical examples covering topics such as medical treatment methods and devices, an injection mold controller, and livestock management. For each, a claim-by-claim analysis is given and relevant case law is provided.
Finally, it should also be noted that while applicants and inventors may seek to use the rationales set forth in the October 2019 Update and the January 2019 PEG, litigants must remain cautious while doing so. In a recent case, the Federal Circuit chided a patentee for arguing that their patent claims were based on an example of a patent-eligible claim from an earlier PTO Guidance. The Court bluntly stated that “while we greatly respect the PTO’s expertise on all matters relating to patentability, including patent eligibility, we are not bound by its guidance.” Cleveland Clinical Foundation v. True Health Diagnostics LLC, 915 F.3d 743 U.S. 127 (Fed. Cir. April 1, 2019).
In sum, the October 2019 Update should be viewed as clarification of the January 2019 Guidance, but we will have to wait and see what developments arise, such as a future Supreme Court decision or the outcomes from the current STRONGER Patents Act of 2019 legislation before Congress.
This article was written in partnership with Brian Pattengale, PhD. Brian is a postdoctoral fellow at Yale in the Department of Chemistry.