Summary

On December 15, 2014, the U.S. Patent and Trademark Office (PTO) released its updated 2014 Interim Guidance on Patent Subject Matter Eligibility (the “Interim Eligibility Guidance”) in light of the recent Supreme Court decision in Alice Corp. v. CLS Bank (“Alice”)[1], the Association for Molecular Pathology v. Myriad Genetics (“Myriad”)[2] and Mayo Collaborative Serv. v. Prometheus Labs. (“Mayo”)[3].  The Interim Guidance Document states the PTO will use a two-pronged subject matter eligibility test in response to the Alice, Myriad, and Mayo decisions.  This article summarizes the prongs of the test and provides some analysis about how the PTO is interpreting the language of Mayo, Myriad, and Alice under the Interim Eligibility Guidance.

Introduction

The Interim Eligibility Guidance provides revised instructions for PTO patent examiners to determine subject matter eligibility pursuant to 35 U.S.C. § 101, but “does not constitute substantive rulemaking and does not have the force and effect of law.”  Interim Eligibility Guidance at 4.  However, the Interim Eligibility Guidance is meant to supersede the Manual of Patent Examining Procedure (“MPEP”) § 2105 to the extent that the examiners reviewing an application that is potentially directed at a naturally occurring phenomena should no longer use the “mere human intervention” standard, but instead should evaluate whether the naturally occurring principles or substances have “markedly different characteristics to what occurs in nature.” Id. at 6.

Subject Matter Eligibility Test

Consistent with the PTO’s previous analysis, the Interim Eligibility Guidance calls for a two-pronged test to determine subject matter eligibility.

1. First Prong: Statutory Subject Matter

The examiner should first determine whether the claim is directed towards a “process, machine, manufacture, or composition of matter,” consistent with the requirements of 35 U.S.C. § 101.  If the claim does not recite subject matter that falls under one of the four statutory categories, than the analysis terminates with a rejection pursuant to section 101.  Otherwise, the examiner should proceed to the second prong of the test.

2. Second Prong: Judicial Exception Analysis Pursuant to Alice, Myriad, and Mayo

The examiner should next determine whether the claim is “directed to a law of nature, a natural phenomenon, or an abstract idea”—collectively, the “judicial exceptions.”  Id. at 10.  This second prong of the PTO’s test mirrors the two-part Mayo Test.  The examiner should: (A) determine if the claim is directed towards a judicial exception to patent eligibility; and if it is, then (B) determine if the claim recites elements that amount to significantly more than the excepted subject matter.

Part A, or the first prong of the Mayo Test, requires that the examiner “determine whether the claimed subject matter, as a whole, falls within a judicial exception” as to avoid “the risk that [the claim] will tie up the excepted subject matter and pre-empt others from using the law of nature, natural phenomenon, or abstract idea.”  Id. at 10, 12 (quoting Mayo, 132 S.Ct. at 1301) (internal quotation marks omitted).  The PTO provides the following illustrative list of concepts that the Supreme Court or Federal Circuit have considered to meet this criteria:

Exemplary Laws of Nature and Natural Phenomenon

  • Isolated DNA (Myriad)
  • A correlation that is the consequence of how a certain compound is metabolized by the body (Mayo);
  • Electromagnetism to transmit signals (Morse)[4]; and
  • Chemical principle underlying the union between fatty elements and water (Tilghman)[5];

Exemplary Abstract Ideas

  • Mitigating settlement risk (Alice);
  • Hedging (Bilski)[6];
  • Creating a contractual relationship (buySAFE)[7]
  • Using advertising as an exchange or currency (Ultramercial)[8];
  • Processing information through a clearinghouse (Dealertrack)[9];
  • Comparing new and stored information and using rules to identify options (SmartGene)[10];
  • Using categories to organize, store and transmit information (Cyberfone)[11];
  • Organizing information through mathematical correlations (Digitech)[12];
  • Managing a game of bingo (Planet Bingo)[13];
  • The Arrhenius equation for calculating the cure time of rubber (Diehr)[14]
  • A formula for updating alarm limits (Flook)[15];
  • A mathematical formula relating to standing wave phenomena (Mackay Radio)[16]; and
  • A mathematical procedure for converting one form of numerical representation to another (Benson)[17].

Products of Nature – Markedly Different Characteristics Test

The PTO defines laws of nature and natural phenomena, in accordance with judicial precedent, to include “naturally occurring principles/substances and substances that do not have markedly different characteristics compared to what occurs in nature.  Interim Eligibility Guidance, at 12 (emphasis added).  Specifically, the examiner should compare the structural, functional, or other characteristics of the claimed subject matter, when viewed as a whole, to the naturally occurring product to determine if the claimed subject matter differs from the naturally occurring product.  Id. at 18.  Notably, this test requires consideration of both functional and structural differences, whereas the previous PTO procedure limited the analysis to only structural differences.  Id.  For example, the examiner should now consider “biological or pharmacological functions or activities,” “[c]hemical and physical properties,” “[p]henotype, including functional and structural characteristics,” and “[s]tructure and form, whether chemical, genetic or physical,” among other characteristics, to determine if the claimed product markedly differs from the naturally occurring product. Id. at 18-19.

If the examiner determines that the claimed subject matter is directed towards a judicial exception (i.e., an abstract idea, naturally occurring phenomenon, or law of nature), than the analysis proceeds to part B of the test.

Part B of the PTO test incorporates the second prong of the Mayo Test, requiring the examiner determine if the claim recites an “inventive concept” that “amounts to significantly more than the exception itself.”  Id. at 20 (quoting Alice, 134 S.Ct. at 2357).  To assist in the analysis, the Interim Eligibility Guidance provides exemplary elements that the Supreme Court has identified as potentially amounting to “significantly more” than the judicial exception, and a corresponding list of elements that fail to recite “significantly more” than the judicial exception.

“Significantly More” than the exception Not “Significantly More” than the exception
  • Improvements to another technology or technical field (Alice)
  • Improvements to the functioning of the computer itself (Alice)
  • Applying the judicial exception with, or by use of, a particular machine (Bilski)
  • Effecting a transformation or reduction of a particular article to a different state or thing (Diehr)
  • Adding a specific limitation other than what is well-understood, routine and conventional in the field, or adding unconventional steps that confine the claim to a particular useful application (Mayo)
  • Other meaningful limitations beyond generally linking the use of the judicial exception to a particular technological environment (Alice)
  • Adding the words “apply it” (or an equivalent) with the judicial exception, or mere instructions to implement an abstract idea on a computer (Alice)
  • Simply appending well-understood, routine and conventional activities previously known to the industry, specified at a high level of generality, to the judicial (Alice)
  • Exception, e.g., a claim to an abstract idea requiring no more than a generic computer to perform generic computer functions that are well-understood, routine and conventional activities previously known to the industry (Alice)
  • Adding insignificant extrasolution activity to the judicial exception, e.g., mere data gathering in conjunction with a law of nature or abstract idea (Mayo)
  • Generally linking the use of the judicial exception to a particular technological environment or field of use (Mayo)

Conclusion

The 2014 Interim Guidance on Patent Subject Matter Eligibility provides a useful tool to analyze the subject matter eligibility of patent claims in view of the recent Supreme Court decisions of Alice, Myriad, and Mayo.  The Interim Eligibility Guidance further provides helpful examples from which eligibility prospects may be inferred by way of comparison.  While a handful of courts and PTO examiners have already determined patent eligibility in view of  Alice, Myriad, and Mayo, it is still too early to generalize the ultimate impact of these decisions on patents directed towards judicial exceptions (e.g., software or variations of naturally occurring products).  We will continue to monitor both the PTO and the courts to evaluate application and interpretation of these tests.

 

[1] Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. __, 134 S.Ct. 2347 (2014).

[2] Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. __, 133 S.Ct. 2107 (2013).

[3] Mayo Collaborative Serv. v. Prometheus Labs., Inc., 566 U.S. __, 132 S.Ct. 1289 (2012).

[4] O’Reilly v. Morse, 56 U.S. 62 (1853).

[5] Tilghman v. Proctor, 102 U.S. 707 (1881).

[6] Bilski v. Kappos, 561 U.S. 593 (2010).

[7] buySAFE, Inc. v. Google, Inc., __ F.3d ___, 112 USPQ2d 1093 (Fed. Cir. 2014).

[8] Ultramercial, LLC v. Hulu, LLC and WildTangent, __ F.3d __, 112 USPQ2d 1750 (Fed. Cir. 2014).

[9] Dealertrack Inc. v. Huber, 674 F.3d 1315 (Fed. Cir. 2012);

[10] SmarGene, Inc. v. Advanced Biological Labs., SA, 555 Fed. Appx. 950 (Fed. Cir. 2014) (nonprecedential).

[11] Cyberfone Sys. v. CNN Interactive Grp., 558 Fed. Appx. 988 (Fed Cir. 2014) (nonprecedential).

[12] Digitech Image Tech., LLC v. Electronics for Imaging, Inc., 758 F.3d 1344 (Fed. Cir. 2014).

[13] Planet Bingo, LLC v. VKGS LLC, __ Fed. Appx. __ (Fed. Cir. 2014) (nonprecedential).

[14] Diamond v. Diehr, 450 U.S. 175 (1981).

[15] Parker v. Flook, 437 U.S. 584 (1978).

[16] Mackay Radio & Tel. Co. v. Radio Corp. of Am., 306 U.S. 86 (1939).

[17] Gottschalk v. Benson, 409 U.S. 63 (1972).