Last week, the U.S. Court of Appeals for the Federal Circuit issued its second and third decisions in American Axle & Manufacturing v. Neapco Holdings and Neapco Drivelines, the case we’ve previously discussed in which the following claim (claim 22) was held to be unpatentable because it “merely describes a desired result”:

22. A method for manufacturing a shaft assembly of a driveline system, the driveline system further including a first driveline component and a second driveline component, the shaft assembly being adapted to transmit torque between the first driveline component and the second driveline component, the method comprising:

Providing a hollow shaft member;

Tuning a mass and a stiffness of at least one liner, and

Inserting the at least one liner into the shaft member;

Wherein the at least one liner is a tuned resistive absorber for attenuating shell mode vibrations and wherein the at least one liner is a tuned reactive absorber for attenuating bending mode vibrations.

The original split panel produced a majority opinion from Judge Dyk supported by Judge Taranto, and a dissent by Judge Moore, affirming the district court’s ineligibility ruling. On July 31, 2020, the 12 judges of the court evenly split on whether a rehearing en banc was appropriate, resulting in the petition for rehearing en banc being denied. In addition to two concurrences, there were four separate dissents on the en banc petition decision.


Continue Reading Federal Circuit Still Spinning Its Wheels on American Axle

On Thursday, April 23, the USPTO released a new study entitled “Adjusting to Alice: USPTO patent examination outcomes after Alice Corp v. CLS Bank International.” The report illustrates the dramatic impact of two developments in the application of § 101 law: first, the Supreme Court’s Alice decision in June 2014, and—second and more recently—promulgation to patent examiners of the USPTO’s internal documents providing more specific guidance for how to apply the doctrine of Alice.

Although the illustrated results are hardly unexpected to anyone following the developments of § 101 law over the years, the study provides intuitive graphical summaries of the trends over time, specifically with respect to the metrics of (a) percentage of first actions with a § 101 rejection, and (b) variability of the issuance of § 101 rejections by examiners. (Metric (b) is of note, since it tracks the level of uncertainty, which—as the USPTO mentions in the introduction—tends to reduce investment as it rises.) Specifically, Figures 1 and 2 (reproduced below) illustrate how Alice led directly to dramatically elevated levels for both metrics; similarly, Figures 3 and 4 illustrate how the USPTO’s January 2019 Patent Subject Matter Eligibility Guidance (PEG)—and to a lesser extent its earlier Berkheimer memorandum—led directly to equally dramatic reductions in the metric levels.


Continue Reading New USPTO Study Examines the Effects of Alice and USPTO Guidelines on Patent Eligibility

Under the America Invents Act, the USPTO is to stop accepting petitions for review of covered business method patents after September 16, 2020. Given the various other priorities Congress will be dealing with between now and then, it appears virtually certain that Congress will not do anything to prevent the scheduled sunset of this transitional proceeding.

Two years ago, the House Judiciary Committee’s Subcommittee on Courts, Intellectual Property and the Internet held hearings on the upcoming sunset of the CBM program, and even back then the statistics did not bode well for its continuance. Now, the writing on the wall is even clearer. According the USPTO statistics, 589 CBM petitions have been filed since inception of the program in 2012, but in only three of the last twelve months have any CBM petitions been filed at all. In the 2018 hearings, both subcommittee members and witnesses espoused a wide range of views, but with relatively little vehemence. Other than a few blog post/law review commentaries, virtually nothing happened in the wake of the hearings.
Continue Reading Whither (more likely wither) CBMs

Sharply differing majority and dissenting opinions in the Federal Circuit’s recent American Axle & Manufacturing v. Neapco Holdings decision present yet another case where the Federal Circuit appears to be in need of further patent eligibility guidance from the Supreme Court. The American Axle case centers on the patent-eligibility of a method for dampening vibrations in vehicle driveshafts. In its recent decision, the Federal Circuit upheld the district court’s grant of summary judgment in that dispute, holding that under controlling precedent the asserted claims are ineligible under § 101 as preempting a natural law.

Continue Reading Rough Ride for Split Federal Circuit on Eligibility of Driveshaft Vibration Reduction Method

In January, the USPTO announced it would seek comments on the new Guidance it had published on patent subject matter eligibility. We have previously discussed this Guidance and won’t repeat ourselves here. Instead, this post will highlight the wide range of views expressed by the thousands of comments that the USPTO received. Although the comment period ended on March 8, the USPTO cautioned that its web page posting the comments might not be complete for a couple of weeks thereafter. By now, all the submitted comments likely have been posted so it’s time to take a look at them.

Continue Reading No Shortage of Viewpoints on New USPTO Patent Eligibility Guidelines

Much ink has been spilled in recent times on the standards for, and outcomes of, patent eligibility questions under § 101.  Consider, for example, USPTO Director Andrei Iancu’s remarks in September about providing additional guidance to Patent Office examiners, and various analyses of invalidation rates in the federal courts. (We touched on invalidation rates ourselves in our Bilski Blog update in August, at which time the Federal Circuit’s cumulative invalidation rate since July 2014 was hovering north of 88 percent.)

One topic has received little attention, however: The rulings of the Patent Trial and Appeal Board on pre-grant § 101 examiner rejections appealed by applicants.  In my opinion, this constitutes the proverbial elephant in the room for patent prosecutors.


Continue Reading Still No Path Out of the 101 Swamp?

Since our last update in June 2017, all the invalidation averages for decisions finding lack of subject matter eligibility have trended slightly downward in the federal courts. Specifically:

  • The overall percentage of decisions invalidating patents under § 101 since we started tracking statistics in July 2014 has fallen slightly—from 67.5% to 66.0%—year over year.

If the focus on fact finding in Aatrix, Berkheimer, and Exergen from earlier this year helped provide additional clarity on the analysis of “something more,” the SAP America decision, at least to my mind, failed to clarify, and possibly further muddied, the analysis.

Reaching This Result Could Have Been Easy

First, a representative claim:

1. A method for calculating, analyzing and displaying investment data comprising the steps of:

(a) selecting a sample space, wherein the sample space includes at least one investment data sample;

(b) generating a distribution function using a re-sampled statistical method and a bias parameter, wherein the bias parameter determines a degree of randomness in a resampling process; and,

(c) generating a plot of the distribution function.

The other independent claims differ a bit from claim 1, but like claim 1 recite “resampling” of the data set and, in claim 11, doing so with a “bias parameter.” According to the patent, this resampling of investment data permits analysis that doesn’t assume a normal distribution of the data.

On a judgment on the pleadings, the district court found all claims ineligible and the Federal Circuit affirmed.


Continue Reading Two Steps Forward, One Step Back

With counterpoint by Gregory Hopewell

In reading post-Mayo/Alice decisions, some seem more comfortable than others. I’ve been having a tough time getting my head and heart around a recent decision from Judge Leonard Stark of the District of Delaware.  The case is American Axle & Manufacturing v. Neapco Holdings and Neapco Drivelines.  From the party names alone, this does not appear to be a likely candidate for Section 101 invalidity.

The claims that the court found representative for Section 101 analysis confirm that we’re not talking about social media applications or financial methods here, but instead “a method for manufacturing a shaft assembly of a driveline system.”  Classic auto industry innovation dispute between two Detroit area companies, with a bonus that the judge also hails from Detroit.  Spoiler Alert: To my surprise, the first sentence of the opinion’s discussion section said, “As explained below, the Court has determined that the Asserted Claims are not directed to patentable subject matter.”


Continue Reading Good Vibrations, Bad Vibrations: American Axle v. Neapco Ruling