The Interim Guidance on Patent Subject Matter Eligibility is the authoritative source of the USPTO’s instructions to patent examiners for applying 35 U.S.C. § 101 to pending applications. This document was originally released in December 2014, and has been supplemented with refinements and updates that reflect changes in the law.
The latest update to the Interim Guidance (released in July 2015) provides insightful examples of patent-eligible subject matter, and the USPTO has solicited public comments about the updated document. Responsive to this solicitation and based upon earlier observations of trends in the application of § 101 by courts and examiners, the following recommendations are presented to promote the stabilization of this turbulent area of patent law.
The following recommendations for continuing the development of the Interim Guidance, based upon observations of trends in § 101 law, have been submitted to the USPTO for consideration (link to formal submission).
Recommendation #1: Require examiners to provide a § 101 analysis on the record in every patent application.
At present, § 101 challenges are routine and predictable in every instance of patent enforcement – as well as patents that are not being asserted, but that are challenged via inter-partes review. Because every patent faces the prospect of a patent-eligibility challenge, it is advisable that every patent application should feature an explicit patent-eligibility determination and analysis, both during examination and in the notice of allowance.
The patent-eligibility statement should be both case-specific (utilizing boilerplate language only as a framework for the analysis of the particular case under review) and detailed (a consideration of the claimed invention from a variety of angles, in the manner of the Supreme Court Alice decision).
Furthermore, examiners should acknowledge the successful traversal of a § 101 rejection with an affirmative statement of patent-eligibility. Cases that clear the § 101 determination by a wide margin should also include a positive statement of the examiner’s patent-eligibility conclusion, and may utilize the “streamlined” analysis provided in the Interim Guidance.
This requirement will provide the following benefits:
- Applicants facing a § 101 rejection will have a clear statement from the examiner that can be reviewed for technical accuracy, legal sufficiency, and persuasiveness.
- Patentees facing a patent-eligibility challenge during an infringement trial or inter-partes review can cite the explicit and detailed statement of the examiner that supports and informs the conclusion of patent-eligibility.
- The collective output of patent-eligibility determinations by the USPTO examining corps will be amenable to analysis to identify patterns and trends in the application of § 101.
Recommendation #2: Encourage examiners to express positive opinions of patent-eligibility where applicable, and to work proactively with the applicant to resolve § 101 issues.
Currently, examiners are over-applying § 101 rejections for various reasons: as a discretionary rejection mechanism; to defer patent-eligibility determinations until other issues are resolved; or to push the § 101 issue up the chain of review to the supervisor and/or PTAB.
USPTO administration must act to reverse the cultural skew that favors § 101 rejections and discourages positive statements of patent-eligibility. This message should be conveyed through both the Interim Guidance and the administration’s general cultivation of examining corps culture, as follows:
- Examiners should be encouraged to express opinions and honest conclusions about § 101. Supervisors should not set goals or quotas for allowance or rejection rates, but should instead review examiners’ rationale on a case-by-case basis.
- Abuses of § 101 examination practice should be discouraged, and eventually identified and penalized as an examination error. Such abuses include: rejections that are completely generic and lacking in analysis; rejections that mischaracterize the technology; and the routine over-application (such as a near-100% rejection rate) or under-application (such as a near-0% rejection rate in a technology area that may frequently raise § 101 issues).
- In the interest of compact prosecution, examiners should be encouraged to work proactively with the applicant to identify options for amendments that may put the claims into a form that satisfies § 101. For example, examiners should suggest subject matter from the specification or dependent claims that satisfy patent-eligibility.
Recommendation #3: Provide an abundance of examples of inventions and claims, with a detailed analysis and explanation of the patent-eligibility determination.
For both examiners and applicants, the most accessible and relatable material in the Interim Guidance is Appendix A of the July Update, which provides examples of patent-eligible subject matter and claims, an accompanying § 101 analysis, and in some cases a contrasting example of patent-ineligible claims. The examples provided in the July 2015 Update to the Interim Guidance significantly widened the base of subject matter upon which examiners and applicants rely as “safe harbors” of patent-eligibility.
It is therefore advisable that, of all the subject matter that might be added to the Interim Guidance, the USPTO should prioritize expanding this set of examples, drawn from both case law and hypotheticals, that have general applicability to a wide range of pending applications. Ideally, the Interim Guidance may evolve into an extensive library of examples of both patent-eligible and patent-ineligible subject matter.
It is further submitted that the USPTO should prioritize the identification of patent-eligible subject matter, claims, and analyses, for the following reasons:
- The courts, including the PTAB, are already providing numerous examples of determinations of patent-ineligibility, and very few examples of patent-eligibility. While these opinions should be dutifully reported in the Interim Guidance, the USPTO should allocate its efforts in the opposite proportion in the interest of balance.
- Examiners face a comparatively low threshold in asserting patent-ineligibility. Such determinations are primarily based upon the examiner’s conceptual review of the claimed invention, and rarely rely upon an example of patent-ineligible subject matter. On the other hand, both examiners and applicants closely follow the provided examples of patent-eligible subject matter.
- In general, it is easier to draft patent claims and specifications toward a patent-eligible example, than to draft such claims and specifications in a manner that avoids a minefield of examples of patent-ineligibility.
Recommendation #4: Organize examples into two sets: subject-matter examples and claim examples.
Examiners’ rejections of claims under Alice typically reflect one of two determinations: either the disclosed invention is irreconcilably “abstract”; or the invention as claimed fails to satisfy § 101, but the disclosure provides further subject matter providing “significantly more” than the “abstract idea,” such that claim amendments are available that may recover the claims from patent-ineligibility. However, the typical § 101 rejection that generically cites portions of Alice fails to indicate which conclusion the examiner has reached.
It is recommended that the Interim Guidance articulate these distinct steps as an element of the Step 2B / “Significantly More” analysis. The Interim Guidance should urge examiners to consider whether the claimed subject matter is entirely “abstract,” or whether the claims could satisfy the § 101 analysis if recited with more technical detail (presuming sufficient specification support).
To reinforce this distinction, the Interim Guidance could organize its examples into two distinct types:
- Subject matter that is “abstract” per se, and cannot be claimed in any manner that will satisfy § 101; and
- Subject matter that is not “abstract” per se, but that is claimed in a manner that fails to provide patent-eligible subject matter.
It is further advisable that, as with several portions of the Interim Guidance, these examples should be presented as pairs of contrasting examples that respectively fail and satisfy § 101, with an analysis that emphasizes the critical distinction.
Finally, the Interim Guidance should encourage examiners to include a clear statement in the § 101 analysis that identifies one of these two scenarios as the examiner’s conclusion.
Recommendation #5: Provide classifications of technology areas according to “technical effect” probability.
The July 2015 Update to the Interim Guidance provides an interesting option to assist with examiners’ § 101 analyses. Example 15 demonstrates a computing technology for which patent-eligibility is “self-evident,” and the application of a § 101 “streamlined analysis” that bypasses the complexity of a full § 101 analysis. This example contrasts with other examples, in areas of innovation that have been identified as problematic for § 101 such as “method of organizing human behavior” and “fundamental economic practices long prevalent in our system of commerce,” for which a full § 101 analysis is required.
This contrast raises an interesting and valuable opportunity to classify general areas of technology that prompt varying levels of § 101 analysis. For example:
- Some technologies may be identified as unlikely to raise a patent-eligibility issue, and may be good candidates for a “streamlined” § 101 analysis. Such technologies may include: hardware device drivers and control systems; encryption; data compression; error detection and correction; media encoding; process isolation; search techniques; and query processing.
- Some technologies may be identified as possibly raising a patent-eligibility issue, and require a careful review of the claimed subject matter. Such technologies may include: social interaction; targeted advertising; product recommendations; and web-based services that do not directly pertain to technology.
- Some technologies may be identified as likely to raise a patent-eligibility issue, and require a clear demonstration of a “technical effect” to counter an abstractness determination. Such technologies may include: financial transactions; risk hedging; contractual relationships; methods of playing games; naturally occurring compositions; and diagnostic techniques that predominantly involve mental evaluation.
Of course, these categories are not dispositive. Even technologies with self-evident application may nevertheless require a § 101 rejection if claimed in a conceptual and preemptive manner. Conversely, techniques in problematic areas may nevertheless present patent-eligible technology (as demonstrated by DDR Holdings, LLC v. Hotels.com). Rather, these categories indicate the likely “self-evident” technical character of a technical field, and the depth of § 101 analysis that such technologies likely require.
These categories may be expanded and adjusted over time as further examples are provided by case law, and may eventually be presented as a spectrum of the “self-evident” technical character for different fields of technology.
Recommendation #6: Provide examples of boilerplate that provide a framework for various § 101 determinations.
Examiners’ development and use of boilerplate templates to articulate § 101 rejections have given rise to a host of problems. The number and variety of such templates have inexplicably proliferated, resulting in inefficiency and unnecessary complexity with no cognizable benefit. Moreover, the reduction of § 101 analysis to a “fill-in-the-blanks”-style template enables the substitution of decontextualized court statements and subjective conclusions for case-specific analysis.
The Interim Guidance can address these issues by encouraging examiners to use one of a small number of boilerplate templates to express various § 101 determinations. Each boilerplate may articulate a specific conclusion under § 101, such as:
- The claims are patent-eligible under a streamlined analysis.
- The claims are patent-eligible because they do not present an abstract idea.
- The claims are patent-eligible because they present an abstract idea, but also provide “significantly more” than the abstract idea.
- The claims are patent-ineligible because the subject matter is per se abstract.
- The claims are patent-ineligible for failing to provide “significantly more” than an abstract idea, but the inclusion of additional detail (specifically identified in the office action) is likely to satisfy the requirements of § 101.
Additionally, each boilerplate template must include more than a slot to paste in claim language, but rather provides a framework for the examiner’s case-specific discussion of the issue – such as the “abstract idea” that the examiner believes the claims recite; the basis for characterizing additional limitations as “conventional”; and, for subject matter that is claimed in a conceptual manner and raises preemption issues, some examples of scenarios that the claims unreasonably cover that are within the claims but outside the applicant’s intended field of use. The provision of such boilerplate options in the Interim Guidance may both foster and compel examiners to provide extensive, case-specific commentary and analysis as the basis for their § 101 determinations.
Recommendation #7: Encourage the PTAB to identify examples of patent-eligible subject matter, and to designate such opinions as precedential or informative.
The Patent Trial and Appeal Board exhibits both a statistical tilt toward creating rather than resolving § 101 issues, and a refusal to identify precedential opinions. As the USPTO’s most authoritative and detailed source of § 101 determinations – with an annual production of 10,000 opinions, of which 50% include a determination of § 101 patent-eligibility – the PTAB’s absence from the Interim Guidance reflects a lost opportunity to contribute to the stabilization of § 101 law.
It is recommended that the Office of Patent Legal Administration work with the Patent Trial and Appeal Board to identify a significant number of ex-parte appeals that present prototypical examples of patent-eligible and patent-ineligible technologies and claim styles. The citation in the Interim Guidance of examples that are founded upon real applications and claims, resulting in a full legal determination, provides inherently more reliable material than hypotheticals devised solely by USPTO administration.
Going forward, the PTAB should be urged to identify select cases – such as five decisions per month – that clarify the patent-eligibility of various technology areas and claim styles, which can be periodically published in the Federal Register and incorporated into the Interim Guidance. Furthermore, the Office of Patent Legal Administration may request the PTAB to identify, and designate as precedential, ex-parte appeals involving issues in particular need of clarification – such as those involving technologies in the patent-eligibility “gray zone” like social networking technologies.
It is possible that the PTAB’s reluctance to designate precedential decisions derives from a reluctance to expose its assertions for reversal by higher courts. However, this area of law is widely recognized as dynamic, and reversals of the PTAB can be described in the Federal Register as the correction of previous § 101 decisions. Moreover, by exacerbating rather than reducing the prevalence and uncertainty of § 101 issues, the PTAB fails to reduce the rate of ex-parte appeals, and by extension the PTAB’s unresolvable backlog and pendency. Participating in the stabilization of § 101 is therefore in the PTAB’s best interests.