The United States Patent and Trademark Office (USPTO) recently announced revised guidelines for evaluating patent applications for subject-matter eligibility. The new guidance took effect from 7 January 2019, with the aim of helping the 8,500 patent examiners and administrative patent judges at the USPTO make clear and consistent decisions concerning inventions which are on the borderline of the patent system.
What is ‘Excluded Matter’?
Patents are intended to protect practical and technical innovations, rather than purely artistic creations or abstract ideas. This distinction is set out in ‘Section 101’ of the US patent law, and in recent years the US Supreme Court has developed a framework, often called the Alice/Mayo test, which defines certain categories of subject-matter as being non-patentable in the United States. However, it has been difficult for inventors, business and competitors to get a predictable view of that line between ‘patentable’ and ‘non-patentable’ subject matter.
What has changed?
Previous versions of the guidance highlighted various decisions from the Federal Courts which applied the Alice/Mayo test, meaning that each invention would be assessed by comparing against a long, and continually growing, list of earlier examples. That was appropriate initially, but has now become impractical, with contradictory decisions with apparently similar subject matter found to be both ‘patentable’ and ‘non-patentable’ in different cases.
What is in the new guidance?
Section 101 was held by the Supreme Court to have an explicit exclusion for “laws of nature, natural phenomena and abstract ideas” as being “the basic tools of scientific and technological work”. In other words, a patent monopoly is not appropriate for these basic ideas, which should instead remain available for use by all. Conversely, the court recognised that “at some level, all inventions embody, use, reflect, rest upon, or apply laws of nature, natural phenomena or abstract ideas” and we must “tread carefully in construing this exclusionary principle lest it swallow all of patent law”.
The guidance then explains a revised procedure, based on the Supreme Court case law, to determine whether a patent claim is excluded under the Alice/Mayo test. The new guidance puts forward three main categories of ‘abstract ideas’.
a. Mathematical concepts
mathematical relationships, mathematical formulas or equations, mathematical calculations.
b. Certain methods of organizing human activity
fundamental economic principles or practices (including hedging, insurance, mitigating risk); commercial or legal interactions (including agreements in the form of contracts; legal obligations; advertising, marketing or sales activities or behaviours; business relations); managing personal behaviour or relationships or interactions between people (including social activities, teaching, and following rules or instructions).
c. Mental processes
concepts performed in the human mind (including observation, evaluation, judgment, opinion)
The guidance allows a streamlined analysis where patent eligibility is self-evident (e.g. an improved lawn mower). Otherwise, a detailed two-prong enquiry is performed. ‘Prong One’ firstly determines whether the claim ‘recites’ one of the judicial exceptions (law of nature, natural phenomenon or abstract idea according to the list as quoted above). ‘Prong Two’ then considers whether the claim is a whole is ‘directed to’ one of those exceptions. ‘Prong Two’ in particular looks at whether the claim recites additional elements that integrate the identified exception into a practical application of that exception by imposing a meaningful limit on the judicial exception (i.e. that this is substantive rather than merely a clever claim drafting effort). This two-prong enquiry under ‘Step 2A’ of the Alice/Mayo test represents the main change from earlier guidance.
Even when the claim is found to be ‘directed to’ one of the judicial exceptions, Step 2B of the test further considers whether the claim nevertheless provides an ‘inventive concept’ by having specific limitations which are not ‘well-understood, routine and conventional activities’ in this field, as before.
The new guidance has been broadly welcomed and should help to improve clarity, consistency and predictability of decisions by the USPTO across all technological fields. However, the fact that the guidance has changed frequently in the last few years indicates that this area is still evolving and requires specialist knowledge in order to navigate successfully. At Appleyard Lees we work closely with many US colleagues for exactly that reason to give clients the best possible advice on this difficult field.
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