My last post focused on definitions for the terms “well-understood,” “routine,” and “conventional”—or W-URC—from the subject matter eligibility test set forth in Mayo and further described in Alice. Those terms relate to one part of the current test only. It seems fair to consider another important term in the test, one that’s considered before even reaching the W-URC issue: Whether the claim is “directed to” patent-ineligible subject matter, e.g., a law of nature.

I was particularly reminded of the need to address this when reading last week’s Federal Circuit opinions in Vanda Pharmaceuticals v. West-Ward Pharmaceuticals. Not only did Judge Prost pen a stark dissent from Judge Lourie’s opinion for the court, but both the majority and dissenting opinions focused on this phrase over and over. The opinion of the court referenced “directed to” 17 times and the dissent used it 10 times. Further, the phrase was used either in italics or quotes five times, emphasizing the importance of the term. So it’s worthwhile to give a look to what “directed to” means.

Continue Reading Our Attention is Now Directed To: “Directed To”

The Federal Circuit has now had enough opportunity to address Mayo’s “well-understood, routine, conventional” test that we should have a good understanding of it. We don’t (or at least I don’t).

To begin with, the Federal Circuit cases don’t seem to differentiate among these terms. The cases also universally connect the three terms with “and” rather than “or,” but curiously most of the cases don’t seem to actually require all three to be explicitly met for a determination of ineligibility. See, e.g., Content Extraction, where the Federal Circuit noted only that the patent owner had conceded one function as being “routine.” Finally, there seems to be real disagreement about the extent to which these terms address facts as opposed to legal standards. In this post, I’m not going to comprehensively analyze all these issues, but instead will focus primarily on what these common terms mean.

Continue Reading How Well-Understood is the Meaning of “Well-Understood”?

After Alice, the USPTO’s various guidance memoranda included references to non-precedential Federal Circuit decisions, particularly Smartgene, Cyberfone, and Planet Bingo, as examples of patent-ineligible subject matter.  Naturally, examiners cited these decisions in support of their Section 101 rejections.  Smartgene was the most frequently cited because the USPTO glossed it simply as “comparing new and stored information and using rules to identify options,” a characterization that allowed examiners to apply the case to just about any computer-implemented method.  I and others expressed our concerns to the USPTO about the examiners’ reliance on Smartgene and other non-precedential cases in comments  on the Interim and subsequent guidance memos. Full disclosure: I was counsel to ABL, the patentee in Smartgene. On November 2, 2016, the Office issued the “McRO” memo, explaining how examiners should interpret the Federal Circuit’s decision in McRO v. Bandai.  The memo ended with an instruction that examiners should limit their reliance on non-precedential cases:

Non-precedential decisions:  Finally, given the large and ever-increasing number of  precedential decisions, examiners should avoid relying upon or citing non-precedential  decisions (e.g., SmartGene, Cyberfone) unless the facts of the application under examination uniquely match the facts at issue in the non-precedential decision.  The updated chart of court decisions available on the USPTO’ s SME Webpage indicates whether a decision is precedential or non­ precedential.

The guidance seemed clear:  unless the application before the examiner “uniquely matched” the facts of a non-precedential decision, the decision should not be relied upon–there was an “ever-increasing” number of precedential cases that could be used instead. Continue Reading Examiner Citations of Smartgene, Cyberfone Drop After McRo Memo

On April 17, Mozilla and Stanford Law held a panel to discuss the role of the First Amendment in the patent law, and specifically the impact on the patent eligibility of software and genes sequences.

Joining me on the panel were Dan Burk, a professor at the UC Irvine School of Law; Sandra Park, senior staff attorney at the ACLU Women’s Rights Project; and Wendy Seltzer, strategy lead and policy counsel at the World Wide Web Consortium, as well as moderator Elvin Lee, Mozilla’s Product and Commercial Counsel.

We discussed how IP law and the First Amendment intersect in IP disputes, eligibility tests, and the balance of interests between patent holders and users.

The debate over the First Amendment and boundaries of patent protection became a hot topic for discussion after Circuit Judge Haldane Mayer issued his 2016 opinion in Intellectual Ventures I LLC v. Symantec Corporation.

We discussed and debated both sides, and also talked about topics such as whether patent law creates conflicts with the First Amendment and whether subject-matter eligibility tests created by the Supreme Court (e.g., Alice) mitigate or impact any potential First Amendment issues. We also explored how the First Amendment’s intersection with patent law compares to other IP and regulatory contexts and the different competing interests for IP owners and creators.

On April 12th, the Federal Circuit, in a per curiam order, denied SHzoom’s motion to make the Trading Technologies opinion precedential.   The order of course gave no reasons for the decision.   Even so, the underlying decision is still a good one for patentees and applicants. While not binding on the USPTO, it can nonetheless be argued as persuasive authority to examiners where the facts in the application “uniquely match” those in the case. Prosecutors should consider arguing this case to examiners where they have specifically claimed graphical elements that provide specific functionality. The case is noteworthy because it is the first true “business method” patent that the Federal Circuit has upheld.  The claims of the patents specifically recited steps for placing trade orders in electronic exchanges. Claim 1 of Trading Technologies’ US 6,766,304 is shown here as example: Continue Reading Federal Circuit Denies SHzoom’s Bid to Make Trading Technologies Decision Precedential, But the Case is Still Good Law

On January 18, 2017 the Federal Circuit issued an opinion in Trading Technologies Int’l., Inc. v. CQG, Inc., its first decision finding a user interface to be patent eligible subject matter. The court designated the opinion as non-precedential.  On Monday SHzoom LLC filed a motion under Federal Circuit Rule 32.1(e), which allows any person to request that the court reissue a decision as precedential. The text of the motion is set forth below.  Fenwick represented SHzoom.

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Introduction

Third party SHzoom LLC (“SHzoom”) hereby moves this court to reissue its January 18, 2017 decision (Dkt. No. 73), in Trading Technologies Int’l., Inc. v. CQG, Inc., No. 2017 U.S. App. LEXIS 834 (Fed. Cir. Jan. 18, 2017) (“Trading Technologies”) as precedential, pursuant to Federal Circuit Rule 32.1(e). As the appellant CQG, Inc. (“CQG”) has filed a petition for Rehearing En Banc, Shzoom’s request is filed to meet the stated deadline of Rule 32.1(e), and as such need only be considered if CQG’s request is denied.  The parties to the case have been notified of this request.

Continue Reading Shzoom Requests the Federal Circuit Reissue Trading Technologies as Precedential Opinion

Like the odd aunt whose holiday gifts can range from the wonderful to the recyclable, in 2016 Alice brought both good and bad tidings.  Let’s start with the nice ones. The numbers here are through December 22, 2016.  The big picture is that the overall rate of district court ineligibility decisions* has declined each year since Alice, while the total number of decisions has increased each year.  This may be an indication of several factors.  First, plaintiffs are being more careful in selecting which patents to assert.  Thus, clear losers do not get picked for litigation. On the other hand, defendants continue to push the envelope on what they can challenge under Section 101, and in doing so, have overreached. As a result, the overall invalidity rate has fallen. Continue Reading Alice Brings a Mix of Gifts For 2016 Holidays

Editor’s Introduction:  The following post is by Wayne Sobon, and is based on the remarks he made at the USPTO’s Patent Subject Matter Eligibility Roundtable on December 5, 2016.  Mr. Sobon has over thirty years of experience as a patent attorney. He has served as chief IP counsel in several major corporations, as well as being an entrepreneur.  He is a past president of AIPLA and recently served on the Patent Public Advisory Committee of the USPTO.

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I’d like to go back to some first principles and history.

Article 1, Section 8 of the Constitution neatly divided the promotion of, on the one hand:

  • Science, the fields of knowledge and ideas, by securing exclusive rights to Authors of their Writings. Things like books and maps and charts.
  • And the Useful Arts, where science and ideas are transformed into tools and actions in the world, by securing exclusive rights to Inventors of their Discoveries.

Basic ideas and science would remain free for all.

One of the first Congressional acts was the Patent Act of 1790, which granted patents to any persons that “have invented or discovered any useful Art, Manufacture, Engine, Machine or Device, or any improvement therein, not before known or used”, provided that the invention or discovery was deemed “sufficiently useful and important”.

Continue Reading Exploring the Legal Contours of Patent Subject Matter Eligibility

I am a solo entrepreneur.  After twenty plus years in industry, I decided to take the risk and start my own business using my own capital. In the parlance of the law I am considered, almost affectionately, a micro-entity.

I knew I needed intellectual property protection and one of the first things I did was file for a trademark application.  With my micro-entity status, I successfully prosecuted my own trademark application, without objection from the examiner.  I also wanted to protect my underlying business process, and I assumed that my experience going through the patent prosecution process would go just as smoothly. I have come to learn otherwise.

As a micro-entity, getting my invention patented has proven to be a long and difficult road. With no political connections and very limited resources, it is painfully obvious that this system of multiple office actions, RCEs, and then perhaps appeals to PTAB and the Federal Circuit, was not designed for solo entrepreneurs.  The complexity of the system put me at a particular disadvantage to the larger corporations who are clearly benefiting from my, now published, patent application.

Continue Reading A Long Road Ahead: A Solo Entrepreneur’s Perspective on the USPTO’s Roundtable I – Subject Matter Eligibility Guidelines

On December 5, 2016 the USPTO will hold its second Patent Subject Matter Eligibility Roundtable to discuss issues in patent eligibility.  The USPTO published a list of eighteen questions in anticipation of the event, dealing with various issues in eligibility theory, legislative changes and so forth, and requesting comments in response.  Here are the answers I will be submitting to the Office.

Impact of Judicial Interpretation of Section 101

1. How has the Supreme Court’s interpretation of 35 U.S.C. 101 in the past several years affected the enforcement of patents and the development of subject-matter- eligibility law?

The Supreme Court’s current definition of a law of nature is scientifically incorrect.  The analysis of this issue is quite complex, but I will attempt to summarize the issue.  The Court’s definition in the Mayo case came down to: “the relation itself exists in principle apart from any human action. The relation is a consequence of the ways in which thiopurine compounds are metabolized by the body—entirely natural processes. And so a patent that simply describes that relation sets forth a natural law.”

Continue Reading USPTO’s Patent Subject Matter Eligibility Roundtable on Dec. 5, 2016