The U.S. Patent and Trademark Office Releases an Update to the 2014 Interim Guidance on Patent Subject Matter Eligibility

On May 6, 2016, Michelle K. Lee, the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office (USPTO), announced a second update (May 2016 Update) to the Interim Guidance on Patent Subject Matter Eligibility issued in December 2014 (2014 Interim Guidance). The first update was published in July 2015. The May 2016 update provides additional direction to the Patent Examining Corps in order to improve the consistency and quality of rejections under 35 U.S.C. § 101 in light of Supreme Court cases on eligible subject matter, including Alice Corp. v. CLS Bank International.

The May 2016 Update is in response to submissions by the public regarding the July 2015 Update, and includes a memorandum dated May 4, 2016 (May 2016 Memorandum), as well as an additional exemplary subject matter eligibility analysis of life science claims, using hypothetical claims and claims drawn from case law. The Update also provides an index of eligibility examples and an updated list of subject matter eligibility court decisions (an older version of this list was labeled as Appendix 3 in the July 2015 Update).

The May 2016 Update solicits topics for study under the Topic Submission for Case Studies Pilot Program. These case studies will include a review of the consistency of subject matter eligibility analyses under 35 U.S.C. § 101 across the corps of patent examiners and is expected to be used for quality control purposes. According to the May 2016 Update, the list of subject matter eligibility court decisions from the Supreme Court and Federal Circuit will continue to be updated.

The May 2016 Memorandum is from Robert W. Bahr, Deputy Commissioner for Patent Examination Policy, to the Patent Examining Corps and provides guidance on how examiners should formulate a subject matter eligibility rejection under 35 U.S.C. § 101, and how examiners should evaluate an applicant response to such a rejection.

The May 2016 Memorandum maintains that eligibility under 35 U.S.C. § 101 should be evaluated under the two-part test previously articulated in the 2014 Interim Eligibility Guidance. Step 1 requires an examiner to determine whether a claim is directed to statutorily patentable subject matter: a process, a machine, a manufacture, or a composition of matter; if not, the claim is ineligible.

The May 2016 Memorandum provides additional guidance as to the second part of the two-part test. If the claim recites statutorily patentable subject matter and therefore passes Step 1, the examiner must then apply the Mayo v. Prometheus test by determining whether a claim is directed to a judicial exception of patentable subject matter, including a law of nature, a natural phenomenon, a product of nature, or an abstract idea (Step 2A). If it is not, then the claim qualifies as reciting eligible subject matter and an examiner should not reject the claims under Section 101. However, if the claim is directed to a judicial exception, the May 2016 Update instructs the examiner to follow the below standards when drafting the explanation as to why the claim is rejected.

If the examiner finds that the claim recites a law of nature or a natural phenomenon, the examiner must then identify the law of nature or natural phenomenon the claim recites using a “reasoned rationale,” providing an explanation for the rejection that includes more than mere recitation of claim language as the explanation of the law of nature or natural phenomenon allegedly recited in the claim. Similarly, if the examiner finds that the claim recites a product of nature, then the examiner must identify and explain, using a reasoned rationale, why the product does not have markedly different characteristics from naturally occurring counterparts.

If the examiner finds that the claim recites an abstract idea, the examiner is required only to identify the abstract idea the claim recites and explain why the claim language corresponds to a concept that the courts have identified as an abstract idea, without the need to specify a reasoned rationale. However, examiners are encouraged to cite to an appropriate court decision that supports the identification of the subject matter recited in the claim language as an abstract idea, ensure that the rejection is reasonably tied to the facts of the case, and avoid relying upon language taken out of context.

If an examiner finds that the claim recites subject matter that falls under a judicial exception in Step 2A, the May 2016 Memorandum then instructs the examiner to identify any additional elements recited in the claim that are beyond the judicial exception (Step 2B). Through Step 2B, the May 2016 Memorandum adds to the previously articulated two-part test that in order to maintain a rejection, the examiner must explain why such additional elements do not add significantly to the claim, and therefore why the subject matter recited in the claim still falls under the judicial exception. The explanation must address the additional elements both individually and as a combination. That is, even if an element does not amount to significantly more on its own when considered alongside the other elements recited in the claim, a combination of elements that does amount to significantly more than its individual components can place a claim beyond a judicial exception to patentability. A rejection should be made only if it is readily apparent to an examiner that the additional elements, alone or in combination, do not amount to claiming significantly more than the judicial exception.

The May 2016 Memorandum also asks examiners to evaluate applicant responses by carefully considering all of the applicant’s arguments and evidence rebutting a subject matter eligibility rejection. An applicant may, for example, argue that a claim is eligible because the claim as a whole amounts to significantly more than the judicial exception when the additional elements are considered both individually and in combination. An additional element may be enough to qualify as “significantly more” if “it meaningfully limits the judicial exception, improves another technology or technical field, improves the functioning of a computer itself, or adds a specific limitation other than what is well-understood, routine, conventional activity in the field or unconventional steps that confine the claim to a particular useful application.” In addition, even if an element does not amount to significantly more on its own, it can still amount to significantly more when considered in combination with other elements of the claims, according to the Memorandum. Therefore, a generic computer component performing generic computer functions (a CPU that performs mathematical calculations, for example), in combination with other elements, may be able to perform functions that are no longer generic and amount to significantly more than an abstract idea. The Memorandum also provides several examples for an examiner to use if the examiner deems it appropriate to maintain the rejection.

The USPTO is seeking public comment to the materials presented in the May 2016 Update. The comment period is open-ended, and therefore comments are being accepted on an ongoing basis. Advance notice will be given before the comment period is closed. The USPTO is specifically interested in comments addressing the progress the USPTO has made in the quality of subject matter eligibility rejections.