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Patent Subject Matter Eligibility: Change is Coming

Photo Credit: https://www.ipwatchdog.com/2018/11/23/idea-patent-invention/id=103526/

By: Whitney Lott
Articles Editor, American Journal of Trial Advocacy

Introduction  

For an invention to be patentable, the patent’s claim must be within the subject matter that is patent eligible.  Congress laid out the eligible subject matter for patenting in 35 U.S.C. § 101: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”[1] The Supreme Court has made judicial exceptions to these categories of eligible subject matter including “laws of nature, natural phenomena, and abstract ideas.”[2]  A patent is not automatically ineligible if it is within the scope of one of these exclusionary categories.[3]  These patents that are within the scope of one of these judicial exclusions can be transformed into patent eligible concepts by “integrat[ing] the building blocks into something more.”[4] 

Over the past few years the Supreme Court has made the scope of eligible subject matter increasingly uncertain for a practitioner with its decisions in Mayo Collaborative Services v. Prometheus Laboratories, Inc., Alice Corp. Pty. Ltd. v. CLS Bank International, and other cases.  The confusion associated with whether a patent’s claimed subject matter is eligible led the United States Patent and Trademark Office (or “USPTO”) in January 2019 to issue guidance to administrative judges and examiners on the matter.  The outcry for clarity has not been ignored by Congress, and in May 2019, draft legislation was released that reformed Sections 101 and 112 of the U.S. Patent Act.  The reform legislation seems aimed at expanding the rights of patent holders.    

Uncertainty Created in Mayo/Alice

In Mayo Collaborative Servs. v. Prometheus Labs., Inc., the United States Supreme Court found that a patent process claim was not patent eligible because it claimed a subject matter exclusion against laws of nature.[5]  Prometheus patented a process that used the research on the amount metabolites in a patient to determine the correct drug dosage to administer to be effective but not harmful.[6]  This process included an administration stage where the doctors administered the drug to the patient, a stage where metabolite levels in the patient’s body are tested, and the stage where the doctor was informed of the need to increase or decrease the drug dosage to be both effective and harmless.[7]  The Court determined that the combination of the three steps did not “add enough” to be more than just applying natural laws.[8] 

In its holding, the Court in Mayo found that the Prometheus patent was not patentable because it met the natural law exclusion and failed the “machine-or-transformation” test.[9]  This conclusion did not overrule the “machine or transformation” test but did take the teeth out of the test adding uncertainty.  In its ruling, the Mayo Court practically invited Congress to change the law surrounding §101 stating it was “the role of Congress in crafting more finely tailored rules where necessary.”[10] 

Following Mayo, the Supreme Court in Alice Corp. Pty. Ltd. v. CLS Bank International found that the invention was not patentable because it was an abstract idea that did not have the necessary method claims “to transform that abstract idea into a patent-eligible invention.”[11]  In Alice, the Court laid out the framework that it created in Mayo.[12]  The Mayo framework begins by determining if the patent claim is encompassed by one of the judicial exceptions.[13]  If an exception applies, the Court must determine if the patent claims include an “inventive concept” that can “transform” the idea into a patent eligible idea.[14]  The Court was clear like in Mayo that an abstract idea cannot be transformed into a patent eligible invention merely by stating the abstract idea and then stating, “apply it.”[15]  The Mayo and Alice cases created a test to determine whether a patent’s claim falls within a judicial exception to patent eligible subject matter.  In January 2019, the USPTO offered guidance to its examiners and administrative judges following the rulings in Mayo and Alice.[16]    The USPTO was attempting to provide more certainty for companies that were seeking computer software patents.[17]   

Congress Prepares to Step in

Following these rulings, the United States Senate Judiciary Intellectual Property Subcommittee is preparing to overhaul the law regarding patent eligibility.[18]  A bipartisan draft bill was introduced by subcommittee leaders Thom Tillis (R-N.C.) and Chris Coons (D-Del.) in May of 2019, and the subcommittee held hearings in June to obtain feedback from those with a vested interest in the legislation.[19]  The draft bill would invalidate previous Supreme Court decisions regarding patent eligible subject matter and includes changes to 35 U.S.C. §§ 100, 101, and 112.[20]   

The legislative provisions associated with the draft bill changes include that § 101 must be construed in favor of eligibility and no judicial exceptions can be used in order to find patent eligibility.  The draft bill changes include the following:

Section 100:

(k)  The term “useful” means any invention or discovery that provides specific and practical utility in any field of technology through human intervention.

Section 101:

(a)  Whoever invents or discovers any useful process, machine, manufacture, or composition of matter, or any useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.

(b)  Eligibility under this section shall be determined only while considering the claimed invention as a whole, without discounting or disregarding any claim limitation.

Section 112

(f)  Functional Claim Elements — An element in a claim expressed as a specified function without the recital of structure, material, or acts in support thereof shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof.[21]

The hearings in June allowed for feedback from the various stakeholders in the patent industry to weigh in.  Retired Chief Judges of the Federal Circuit, previous USPTO directors, and various law professors weighed in favorably on Congress overhauling patent eligibility law in order to offer protection and clarity to patent holders.[22]  Draft reforms were opposed by other organizations such as the American Civil Liberties Union due to the fear that the reforms would stifle disease treatment research by allowing inventions claiming “abstract ideas, natural laws, and naturally occurring phenomena” to be patentable which could include human genes.[23]  Given the feedback from both sides at the three hearings in June, the Senate subcommittee will further tailor the draft bill “to ensure that ‘true abstractions, natural laws and naturally occurring phenomenon’ remain ineligible for patenting.”[24]  Congress is showing that change is certainly on its way for patent eligibility, but the final legislative product and its effects still remains to be seen.   


[1] 35 U.S.C. § 101.

[2] Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 70 (2012) (quoting Diamond v. Diehr, 450 U.S. 175, 185 (1981)).

[3] See Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 217 (2014) (citing Mayo, 566 U.S. at 89).

[4] Id. (citing Mayo, 566 U.S. at 89).

[5] Mayo, 566 U.S. at 92.

[6] Id. at 73-74.

[7] Id. at 74.

[8] Id. at 77.

[9] Id. at 88.

[10] Id. at 92.

[11] Alice, 573 U.S. at 212.

[12] Id. at 217.

[13] Id.

[14] Id. (quoting Mayo, 566 U.S. at 72-73, 79).

[15] Id. at 221 (quoting Mayo, 566 U.S. at 72).

[16] 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50, 50-57 (Jan. 7, 2019).

[17] Id.

[18] See Press Release, Thom Tillis, Chair of the Senate Judiciary Subcommittee on Intellectual Property, Senate, Sens. Tillis and Coons and Reps. Collins, Johnson, and Stivers Release Draft Bill Text to Reform Section 101 of the Patent Act (May 22, 2019).

[19] Id.

[20] Id.

[21] Id.

[22] Malathi Nayak, Patent Eligibility Overhaul Plan Backed by Ex-Judges, Officials, Bloomberg L. (July 31, 2019, 1:43 PM), https://news.bloomberglaw.com/ip-law/patent-eligibility-overhaul-plan-backed-by-ex-judges-officials.

[23] Id.

[24] Malathi Nayak, Tillis Aims to Unveil Senate Bill on Patent Eligibility in July (1), Bloomberg L. (June 11, 2019, 4:10 PM), https://news.bloomberglaw.com/ip-law/tillis-aims-to-unveil-senate-bill-on-patent-eligibility-in-july?context=article-related.

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