July 6, 2016

Alice May Be Back From Wonderland

Law360, New York (June 28, 2016, 11:51 AM ET) –Following the  U.S. Supreme Court decisions in Alice and Mayo, and prior to May of this year, the Federal Circuit found one challenged claim patentable under Section 101 and over 20 challenged claims unpatentable. Judge Richard Chen, newly elevated from the position of solicitor at the U.S. Patent and Trademark Office, authored the first post-Alice decision finding eligible subject matter in DDR Holdings in December 2015. On May 12, the Federal Circuit issued a second decision (Enfish) finding a patent claim patentable using the Alice/Mayo framework. Enfish may well moderate what some feel is the extreme change in Section 101 jurisprudence following Alice as well as directly impact how the PTO applies the judicial exception of Alice/Mayo to eligibility during patent examination.

In Enfish v. Microsoft (No 2015-1244; May 12, 2016), the Federal Circuit took issue with a characterization of a patented claim that left the claimed invention behind. Writing for the panel, Judge Todd M. Hughes distinguished claims that merely “involve” a patent-ineligible concept, which at some level describes all claims in every patent, from those that are “directed to” such a concept. Since the Alice “directed to” inquiry is meant to be a stage-one filter to claims considered in light of their corresponding specification, it is necessary to avoid describing the claims at too high a level of abstraction, lest the exceptions swallow all of patent law, as prophesied in Diamond v. Diehr.

The court found the claims in Enfish directed to a specific improvement in the way computers operate, i.e., an improvement to the computer functionality itself, rather than merely automating an otherwise abstract idea. However, the court went further, stating that claims to computer-related technology, and particularly software claims, are not all inherently abstract. Although it has been posited that the means-plus-function character of the claim is what ultimately saved it, or that it was decided by a panel favoring patentability of improvements to computer technology, it is notable that the court devoted significant time reviewing the abstractness of the district court’s abstract idea analysis. Ultimately, Enfish stands for at least the proposition that the first step of the Alice analysis cannot be performed circularly by finding an abstract idea that can be associated with a claim and then declaring the idea to be abstract. Such goal-seeking analysis, as observed by the Federal Circuit and warned against by the Supreme Court, does not provide a meaningful distinction at the first stage of the Alice test.

Days before the Federal Circuit published the decision in Enfish, the patent office issued a memo to the examining corps on May 4 clarifying PTO policy regarding subject matter eligibility and promising more training on how to examine claims for eligibility. Seeking to tie patent office policy regarding the abstract idea analysis to the underlying case law, Deputy Commissioner for Patent Examination Policy Robert Bahr directed examiners seeking to reject a claim based on this judicial exception to identify the challenged concept “as recited in the claim” and then explain how the concept corresponds to a concept held abstract by a court. No longer is the first stage of the Alice test to be a fill-in-the-blank exercise, where an examiner broadly categorizes a claim and then finds the category to be abstract. Now, the test is a multiple-choice/essay exercise, where examiners must choose from a defined list of cases and explain how the challenged claim is like the claim in the case.

The patent office has also issued a second memo specifically responding to the Enfish decision and emphasizing the holdings in the case that support the points made in the first memo. The Enfish memo emphasized the necessity of comparing a claim at issue to a claim already found to be abstract by a court, interpreting claims in view of their supporting specification, and avoiding excessive abstraction or a “gist of the claims” analysis. Finally, the Enfish memo cautioned that a mere ability to function on a general purpose computer does not make a claim automatically abstract and that claims directed to improvements in computer-related technology, including claims directed to software, are not necessarily abstract.

The process, at least initially, should resemble the familiar process examiners use to examine claims against the prior art. The specification and claims are read, and a “broadest reasonable interpretation” of the claims is ascertained. This interpretation is what should then be compared to concepts held abstract in the various court cases to determine whether an argument can be made that the claim, according to the broadest reasonable interpretation thereof, can be read into the abstract concept. This is not unlike what the court did in Enfish to determine that the claim was not directed to an abstract idea. Specifically, the court determined that the claim was limited by the “self-referential” aspect of the rows and columns of the inventive database structure, and that aspect could not be ignored in comparing the claim to other concepts held to be abstract ideas.

The Patent Trial and Appeal Board recently engaged in a searching analysis of a challenged claim that, to this reader, appeared to adhere to the recent developments in Enfish and the two patent office policy memos. The board’s opinion in Samsung Electronics Co. Ltd. v. Smartflash LLC (CBM2014-00190, May 26, 2016) suggests how the patent office may implement the new policies regarding abstract ideas.

By moving in substantially the same direction at the same time, the Federal Circuit and the PTO may move U.S. patent practice back to a more moderate and discerning Alice implementation.

—By Ronald G. Embry, Patterson & Sheridan LLP

Ronald Embry is a partner in Patterson & Sheridan’s Houston office.

The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

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