In the U.S., patent eligibility analysis begins by examining whether a claim falls within the four statutorily provided categories of patent-eligible subject matter under 35 U.S.C. § 101. Most CIIs will meet this requirement, qualifying as processes and/or machines. However, claims directed to pure data structures1 and transitory signals embedded with data2 may fail at this stage. More relevant to most CIIs is the judicial exception to patent eligibility excluding “abstract ideas.” The Supreme Court has set forth a two-step test for analysing patent eligibility under this judicial exception.3
The first step examines whether the claims are directed to a patent ineligible concept, including abstract ideas.4 The courts have not set forth a specific definition of what constitutes an abstract idea, instead often relying on comparisons to prior cases in which claims were found to be abstract. The Federal Circuit has explained that “fundamental economic and conventional business practices are often found to be abstract ideas, even if performed on a computer.”5 Particularly relevant to CIIs, courts have found that inventions directed to improvements in the functioning and operation of the computer do not constitute abstract ideas.6 For example, claims directed to a self-referential table were found not to recite an abstract idea because they recited “a specific improvement to the way computers operate.”7 If claims are determined to recite only an abstract idea, the analysis continues to the second step.
The second step examines whether the claims, looking both at individual steps and as an ordered combination, include an “inventive concept” to transform the claims from an abstract idea into patent eligible subject matter.8 Claims that “merely require generic computer implementation” are insufficient.9 That is, there must be more than performance of well-understood, routine, and conventional activities previously known to the industry.10 Of note, “[w]hether a particular technology is well-understood, routine, and conventional goes beyond what was simply known in the prior art.”11
As an example, in one case, the Federal Circuit found claims to be directed to the abstract idea of collecting, recognising, and storing recognised data.12 The court found that these claims also failed the second step because they recited only use of a generic scanner and computer to perform well-understood, routine, and conventional activities commonly used in the industry.13 In another case, the court examined claims under the second step after similarly finding them to be directed to the abstracted idea of parsing and comparing data, but held that the concept of storing parsed data in an unconventional manner that improved system efficiency could satisfy the second step, precluding a finding of patent ineligibility.14
Patent eligibility decisions both in court and in original prosecution remains difficult to predict, and the standards continue to evolve. Recently, the Federal Circuit held that, while patent eligibility analysis is ultimately a question of law, questions of what constitutes conventional functionality involve underlying questions of fact that may preclude early resolution by a court.15 For example, specification statements describing unconventional aspects or technical advantages may preclude a summary judgment finding of patent ineligibility, if captured in the claims.16
Prosecuting a patent in the U.S. Patent Office may present different challenges. Patent Examiners are not lawyers and will not necessarily be persuaded by legal arguments properly applying case law. The USPTO routinely publishes guidance for examiners for patent eligibility determinations.17 These guidelines are based on recent cases and have provided for a marked increase in allowances for patent applicants. That said, whether something is allowed based on the guidelines, does not necessarily mean it is allowable under the law outlined above. Counsel should prosecute patent applications taking into account both practical considerations for advancing in front of the USPTO while understanding how the law is evolving in the Federal Courts.
