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Inventions claimed in a patent must meet a threshold subject matter eligibility (SME) requirement imposed by the U.S. patent laws.[1] The Supreme Court’s two-step Alice test provides a framework for analyzing whether a claimed invention passes the SME threshold.[2] If a claim is directed to a judicial exception such as a law of nature or an abstract idea (Step One), the claim must contain an inventive concept (Step Two) to meet the SME requirement. Recent applications of this test have yielded criticized, if not controversial, results at the US Court of Appeals for the Federal Circuit.[3]

When an invention is classified as abstract under Step One, the Step Two analysis invokes questions which are similar, but different, from the separate non-obviousness requirement. For one, while non-obviousness requires consideration of the claimed invention “as a whole” by statute,[4] the Alice test requires “consider[ing] the elements of each claim both individually and ‘as an ordered combination,’”[5] to determine if an inventive concept exists. While Alice provides an assurance that its analysis, properly followed, does not undermine the non-obviousness requirements,[6] some courts have expanded Alice in apparent contravention thereof.

Cue P2i Ltd, a recent Northern District of California infringement case involving a patented process for depositing a vaporized polymer onto a substrate via plasma deposition (US Patent No. 8,389,070).[7] In its decision, the court articulated what appears to be a new abstract idea (i.e., unpatentable subject matter): mass production, as applied to an otherwise “known technique,”[8] brought on in part by the patentee’s admission that the patented process was similar to a smaller-scale prior art process.[9]

While the court purported to engage in separate Alice Step One and Alice Step Two analyses, it based this new abstract idea (formally an Alice Step One consideration) primarily on inventiveness grounds. In this court’s view, when a small-scale industrial production process exists in the prior art, application of the purported invention to a larger scale industrial production process is abstract. This view is questionable given that the “abstract ideas category embodies the longstanding rule that an idea of itself is not patentable,”[10] with an eye toward avoiding monopolization of the underlying idea.[11] The ‘070 claims do not seem to monopolize the idea of mass production, per se, and contain concrete limitations and specific steps.[12] Mass production is not even part of the claims.

Having already comingled inventiveness (obviousness) with abstractness (unpatentable subject matter), the court then analyzed inventiveness separately under Alice Step Two. The court admitted that an element of sole independent claim 1 reciting a quantitative plasma zone volume was a “distinguishing [element] . . . [over the] prior art references.”[13] Yet, the court simply dismissed this element as “vague and generalized,”[14] thereby finding the claims non-inventive and thus unpatentable.

In effect, by labeling the claim as an abstract idea because a part of it was in the prior art, the court made an improper ruling on obviousness while sidestepping the burdensome legal and evidentiary requirements of a proper obviousness ruling.[15] This is not hyperbole—the court stated in its rationale that “P2i fail[ed] to cite any legal or factual support for its contention that mass production is not an abstract idea,”[16] thus placing a burden on P2i which it would not have faced under an obviousness analysis.[17]

This ruling shows that when the Alice test is misapplied by courts, it can usurp the non-obviousness requirement. The ‘070 patent survived an earlier Inter Partes Review (IPR) filed by the defendant, where the U.S. Patent and Trademark Office (PTO) deemed the ‘070 patent non-obvious.[18] The court refused to consider this point on the basis that the patentee was conflating the SME requirement with the non-obviousness requirement.[19] Yet, when Alice is misapplied to over-characterize inventions as abstract, the Alice test itself can conflate non-obviousness with SME. This circular logic does not seem to justify this court’s reliance on Alice to address what would have been more properly a question of obviousness.

As a practical matter, patent applicants should take a conservative approach in drafting concrete and specific claims having heightened defensibility against SME challenges, with adequate supporting detail in the patent specification. If commenting on prior art in the specification is warranted, distinctions should be sufficiently specific and reflected in the claims. Applicants should also be wary of making certain statements before the PTO to avoid harmful admissions as in P2i. Absent meaningful judicial or legislative clarifying guidance, trial courts will continue to struggle with SME questions, and unpredictable results such as those in P2i will continue to occur. In the meantime, patentees should utilize forward-looking patent drafting and prosecution strategies which take SME considerations into account before filing a patent application. In the litigation context, when challenging a patent, the accused infringer should focus on whether the claims are abstract rather than obvious. Patentees should argue how the specific claim limitations are indicative of a particular, defined invention and not generic elements that would otherwise be viewed as improper attempts to preempt further innovations.

[1] See, 35 U.S.C. § 101.

[2] Alice Corp. Pty. Ldt. V. CLS Bank Int’l, 573 U.S. 208 (2014); Mayo Collaborative Services v. Prometheus Laboratories, Inc., 556 US 66. See also Manual of Patent Examining Procedures § 2106(III) (analysis diagram).

[3] Recent precedent has tightened the SME requirement as to process claims, the category of claims in the P2i case at issue in this article. In American Axle, a process for tuning driveshafts was held unpatentable as failing to amount to significantly more than Hooke’s Law, the law of nature defining spring forces. Am. Axle & Mfg. v. Neapco Holdings LLC, 939 F.3d 1355 (Fed. Cir. 2019). In Recentive, it was decided that AI-driven processes must do more than merely apply AI, even in novel settings. Recentive Analytics, Inc. v. Fox Corp., 134 F.4th 1205 (Fed. Cir. 2025). See also Landman et al., Driving the Machine Learning Engine is Not Enough, https://www.wiggin.com/publication/
driving-the-machine-learning-engine-is-not-enough/. While a process-article distinction has not been overtly articulated by courts, composition of matter claims, as opposed to process claims, are seemingly better poised to face SME uncertainties. For example, in US Synthetic Corp., an ITC ruling of unpatentability was overturned on the basis that the claimed diamond compacts for drill bits were not directed to an abstract idea. US Synthetic Corp. v. ITC, 128 F.4^th 1272 (Fed. Cir. 2025).

[4] See, 35 U.S.C. § 103.

[5] Alice, 573 U.S. at 217-218.

[6] Alice, 573 U.S. at footnote 3.

[7] P2i Ltd. v. Favored Tech. USA Corp., 2025 U.S. Dist. LEXIS 117967, at *3 (N.D. Cal. 2025).

[8] Id. at *10-11.

[9] Id. at *9.

[10] Alice, 573 U.S. at 218 (cleaned up).

[11] Alice, 573 U.S. at 217.

[12] For example, sole independent claim 1 of the ‘070 patent recites “A method for depositing a polymeric material onto a substrate, the method comprising introducing a monomeric material in a gaseous state into a plasma deposition chamber in which a plasma zone has a volume of at least 0.5 m³, igniting a glow discharge within said chamber, and applying a voltage as a pulsed field, at a power of from 0.001 to 500 W/m³ for a sufficient period of time to allow a polymeric layer to form on the surface of the substrate.”

[13] Id. at *9.

[14] Id. at *13.

[15] While beyond the scope of this article, a proper obviousness analysis requires, inter alia, a rationale as to why a person of ordinary skill in the art would have combined the prior art teachings. See, e.g., Manual of Patent Examining Procedures § 2141. The Alice test requires no such rationale. Examiners and courts also face an evidentiary requirement as to findings of fact which becomes highly relevant when relying upon non-documentary evidence. See, Manual of Patent Examining Procedure § 2144.03.

[16] Id. at *10.

[17] The burden for proving obviousness is on the Examiner during prosecution (to raise a prima facie case), or on the challenger in a litigation (to produce clear and convincing evidence of invalidity).

[18] IPR 2020-004785 (PTAB 2021).

[19] Id. at *16-17.