The Alice Guidance lists four example categories of abstract ideas:

  • fundamental economic practices
  • methods of organizing human activities
  • an idea of itself (sic), and
  • mathematical relationships/formulas. 

Each of these examples has supporting footnotes to the Alice decision and other Supreme Court cases.  But it should be understood that these categories are for potential Abstract Ideas.  That is, something in one of these categories may or may not be an Abstract Idea. Taken superficially and out of context, some of these examples sweep too broadly, and will be too easily misused by examiners.  


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By: Robert R. Sachs

On June 25, 2014, just six days after the Supreme Court decided Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014), the USPTO  issued its Preliminary Examination Instructions (“Guidance”) in view of the case.   Subsequently, the Office asked for public comments on the Guidance.   Over forty companies, associations, law firms and individuals submitted comments, including myself.  This series of posts is based on the comments I submitted to the Office.

In my view, the Guidance does not correctly interpret the Supreme Court’s decision, and does not provide specific guidance to the 7,000 examiners who will have to implement them on a daily basis.  The Court’s decision was not written as a manual for how examiners are to evaluate patent applications, and so simply quoting and paraphrasing the decision (along with scrupulous footnoting) is not sufficient to provide a cohesive, workable framework for the examination of patent applications, particularly for computer implemented inventions.  The core problem remains that examiners will be left to their own subjective evaluation and opinion of the patent eligibility of the claims before them.  Already, the patent community is observing very different approaches from different examiners.  This lack of uniformity leads to increased costs and delays in the examination of patents, as well as increased uncertainty by innovators as to the eligibility of their inventions in technologies that have been traditionally considered patent eligible.


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By: Stuart P. Meyer

A recent episode of NPR’s “Planet Money” was entitled “The Case Against Patents.”  Several notable commentators in that episode questioned whether patents help or hinder innovation, whether history supports the benefits of a patent system, and whether patent terms should be tinkered with to determine the amount of protection that is optimal from various socio-economic perspectives.  I am delighted every time this issue is brought up, since the appropriate balance of rights between innovators and society is anything but static.  As reasonable royalty rates fluctuate under case law, as infringement and validity standards shift, and as patents become commodities traded outside of traditional M&A situations, the fulcrum is certain to shift in one direction or the other. 

The Supreme Court gave more than a little consideration to such issues in Alice v. CLS Bank.  In fact, the very focus of this unanimous opinion was on this balance:

We have described the concern that drives [the judicially-created exclusion for laws of nature, natural phenomena and abstract ideas] as one of pre-emption.  … Laws of nature, natural phenomena, and abstract ideas are “‘”the basic tools of scientific and technological work.”’” (slip op. at 5-6)  


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By: Robert R. Sachs

Alice Corp. v. CLS Bank is out and the result is not unexpected:

1) Alice's patents for computer-implemented methods and systems for financial risk intermediation are invalid.

2) The patents claim abstract idea, but the Court will not "labor to delimit the precise contours of the "abstract ideas" category." That leaves unanswered the primary problem that has plagued the lower courts, identifying in a particular case whether the claims recite an abstract idea. As Judge Lourie said in his plurality opinion below, "deciding whether or not a particular claim is abstract can feel subjective and unsystematic, and the debate often trends toward the metaphysical, littered with unhelpful analogies and generalizations." CLS Bank v. Alice Corp, 717 F.3rd 1269, 1277. Today's decision only continues the trend towards glosses and legal mysticism, with the Court expressing concern over patents on the "building blocks" of "human ingenuity" or the "modern economy," or covering "fundamental practices" "long prevalent" in the field.  What is a "building block"? What is "fundamental"? How is a court or a patent examiner supposed to figure that out?


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By: Robert R. Sachs

On January 31, 2014, Fenwick & West and the Center for the Protection of Intellectual Property (CPIP) at George Mason University School of Law held a roundtable on Patentable Subject Matter at Fenwick’s Silicon Valley office. 

Our approach to this roundtable was different from the typical conference or roundtable on patent

By: Robert R. Sachs, Daniel R. Brownstone

Last week, we filed two amicus briefs with the Supreme Court in Alice Corp. v. CLS Bank, one on behalf of Advanced Biological Laboratories (ABL), and one for Ronald M. Benrey (Benrey). It goes without saying that this is the bellwether case for the patent eligibility of software. The question

By: Robert R. Sachs

 

"To coin a phrase, the name of the game is the claim.”
Judge Giles S. Rich, Federal Circuit (1990)

“We look to the words of the claims themselves … to define the scope ofthe patented invention.”
Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir1996)

“It is a ‘bedrock principle’ of patent law that ‘the claims of a patent define the invention to which the patentee is entitled the right to exclude.’”
Phillips v. AWH Corp., 415 F.3d 1303, 1312 (Fed. Cir. 2005) (en banc)

The above quotations are often cited in discussions and analysis of claim construction, typically in prelude to infringement or validity analysis. But when it comes to determining patent eligibility, there is a clear split within the Federal Circuit as to the importance of claim language, driven by the divergent stances that various members of the court take toward the fundamental question of what counts as an invention.


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By: Robert R. Sachs

The Federal Circuit’s en banc decision in CLS Bank Int’l v. Alice Corp., __  F.3d __, No. 2011-1301, 2013 WL 1920941 (Fed. Cir. May 10, 2013) was roundly criticized as a “nightmare,” further cementing the impression that the court was confused and in conflict over the requirements of patent eligibility under 35 U.S.C § 101. The six non-precedential opinions were seen as leaving patent applicants and owners alike without guidance, let alone predictability, as to whether their patents were valid. Alice Corp.’s patents covered computer-implemented methods and systems for a third-party intermediary to ensure real-time settlement of currency exchange transactions between counterparties. Judges Lourie, Dyk, Wallach, Reyna and Prost appeared to take a hard stand against such software-based financial inventions, finding that neither the method nor system claims were patent-eligible. Under Lourie’s “integrated approach,” the patent claims lacked any “meaningful limitations” and thereby preempted all “practical applications” of the abstract idea of third-party settlement. Taking a middle position, Judges Rader, Moore, Linn and O’Malley agreed that the method claims were not patent-eligible, but argued that the system claims were patent-eligible because they contained limitations that were not necessary and inherent in the abstract idea. At the other end of the bench, Judges Linn and O’Malley argued that the method claims were indeed patent-eligible because they included limitations that prevented the claims from being “unduly preemptive.”


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By: Robert R. Sachs

In Prometheus, Justice Breyer reintroduced the phrase “inventive concept” as it first appeared in Flook. “The Court’s precedents,” Breyer wrote:

Insist that a process that focuses upon the use of a natural law also contain other elements or a combination of elements, sometimes referred to as an “inventive concept,” sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the natural law itself or a combination of elements, sometimes referred to as an “inventive concept,” sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the natural law itself. Flook, supra, at 594. Mayo, 132 S.Ct. 1289, 1294 (slip op. at 3). 


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