A recent Federal Circuit eligibility decision is notable for involving “dissent from [the] court’s continued application of this incoherent body of doctrine.” Interval Licensing LLC v. AOL, Inc., no. 2016-2502, concurrence slip op. at 1-2 (Fed. Cir. July 20, 2018) (Plager, J., concurring-in-part and dissenting-in-part).

Specifically, the Federal Circuit’s recent decision in Interval Licensing includes both a superbly written majority opinion and an excellent concurrence by Judge Plager in which he indicates with respect to the abstract ideas eligibility exception to 35 U.S.C. § 101 that he “respectfully dissent[s] from [the] court’s continued application of this incoherent body of doctrine.” Id.

This article suggests that an alternative route is available to effectively accomplish much the same result while still holding true to Supreme Court eligibility jurisprudence: applying the Supreme Court’s standard approach of narrowly construing statutory exceptions to narrowly construe the implicit statutory exception to 35 U.S.C. § 101 for abstract ideas. This article is divided into three parts.

Part one (below) explains why a narrow construction is appropriate, and suggests that, under this approach, it would be reasonable to only apply the abstract ideas eligibility exception as a bright-line prohibition to concepts that have been indicated to be plainly and unmistakably within its terms and spirit.

Part two suggests that, with respect to the abstract ideas eligibility exception, the only things that the Supreme Court has plainly and unmistakably indicated to be within the terms and spirit of such a bright-line prohibition are mathematical formulas and fundamental practices that are long prevalent.

Part three further suggests that this approach would not foreclose the ability of the judiciary and the U.S. Patent and Trademark Office to address issues raised by claiming at a level of abstraction that results in overbroad claiming, either under 35 U.S.C. § 101 or under 35 U.S.C. § 112.

The implicit statutory exception to § 101, like other statutory exceptions, should be narrowly construed.

The Supreme Court has made clear that statutory exceptions generally should be narrowly construed. For example, in Commissioner v. Clark, 489 U.S. 726 (1989), the Court referenced its “standard approach of construing a statutory exception narrowly to preserve the primary operation of the general rule,” Clark, 489 U.S. at 727, and noted that “[i]n construing provisions … in which a general statement of policy is qualified by an exception, we usually read the exception narrowly in order to preserve the primary operation of the provision.” Clark, 489 U.S. at 739 (citing Phillips, Inc. v. Walling, 324 U. S. 490, 493 (1945)).

The Court has even made clear why statutory exceptions should be narrowly construed, articulating in Phillips that: “[t]o extend an exemption to other than those plainly and unmistakably within its terms and spirit is to abuse the interpretative process and to frustrate the announced will of the people.” Phillips, 324 U. S. at 493.

If this is true for explicit statutory exceptions enacted as part of a statute by legislative representatives of the people, it is even more true for implicit statutory exceptions inferred by the judicial branch.

The patent eligibility exception of 35 U.S.C. § 101 for abstract ideas is such an implicit statutory exception, as the Supreme Court made clear in noting that it has “long held that th[e] provision of [35 U.S.C. § 101] contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable.” Alice Corp. v. CLS Bank Int’l, 134 S.Ct. 2347, 2354 (2014).

In accordance with Supreme Court guidance regarding construction of statutory exceptions, the implicit statutory exception for abstract ideas should be construed “narrowly in order to preserve the primary operation of the provision” of 35 U.S.C. § 101. Clark, 489 U.S. at 739 (citing Phillips, 324 U. S. at 493). To do otherwise would risk “frustrat[ing] the announced will of the people.” Phillips, 324 U. S. at 493.

This is especially true here, where the Supreme Court itself has reasonably declined to “labor to delimit the precise contours of the ‘abstract ideas’ category,” Alice, 134 S.Ct. at 2357, but has cautioned that one must “tread carefully in construing this exclusionary principle lest it swallow all of patent law.” Alice, 134 S.Ct. at 2354.

The boundaries of the abstract ideas eligibility exception have not been defined.

In his concurrence in Interval Licensing, Judge Plager suggests that, with respect to the implicit exception for laws of nature, natural phenomenon, and abstract ideas, “[a]ll too often courts discussing these three judicially created exceptions to patent eligibility lump them together, as if all three present the same set of issues to be conceptualized and analyzed,” when in fact “[t]hey do not.” Interval Licensing, no. 2016-2502, concurrence slip op. at 1-2 (Plager, J., concurring-in-part and dissenting-in-part). Judge Plager notes that “‘[l]aws of nature’ and ‘natural phenomena’ have understandable referents, and thus have proven more amenable to workable definitions, or at least a reasonable degree of boundary-setting,” Id. at 2-3, while “ideas can have an infinite range of abstractness” and “the phrase ‘abstract ideas’ is a definitional morass.” Id. at 5.

Judge Plager eloquently articulates that “[t]he problem with trying to define ‘abstract ideas,’ and why no court has succeeded in defining it, is that, as applied to as-yet-unknown cases with as-yet unknown inventions, it cannot be done except through the use of equally abstract terms.” Id. This conclusion is reinforced by the Supreme Court’s reasonable choice in Alice to decline to “labor to delimit the precise contours of the ‘abstract ideas’ category in this case.” Alice, 134 S.Ct. at 2357. While the Court’s choice was eminently reasonable, it has left decision makers uncertain as to when to apply the abstract ideas eligibility exception.

The Mayo/Alice two-step framework implements a bright-line eligibility prohibition which serves as a proxy for a pre-emption inquiry.

As a bit of background, as noted above, the Supreme Court has “long held that th[e] provision of [35 U.S.C. § 101] contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable.” Alice, 134 S.Ct. at 2354. The Court has “described the concern that drives this exclusionary principle as one of pre-emption.” Alice, 134 S.Ct. at 2354.

The Court has emphasized that “in applying the § 101 exception, we must distinguish between patents that claim the ‘buildin[g] block[s]’ of human ingenuity and those that integrate the building blocks into something more, … thereby ‘transform[ing]’ them into a patent-eligible invention.” Alice, 134 S.Ct. at 2355 (citing Mayo Collaborative Servs. v. Prometheus Labs, Inc., 566 U.S. 66, 89, 132 S.Ct. 1289, 1303 (2012); Mayo, 566 U.S. at 72, 132 S.Ct. at 1294). The Court elaborated that “the former ‘would risk disproportionately tying up the use of the underlying’ ideas, … and are therefore ineligible for patent protection” while “[t]he latter pose no comparable risk of pre-emption, and therefore remain eligible for the monopoly granted under our patent laws.” Alice, 134 S.Ct. at 2355 (citing Mayo, 566 U.S. at 72, 132 S.Ct. at 1294).

The Court articulated its concern regarding disproportionate pre-emption even more clearly in Mayo when it noted that “the underlying functional concern here is a relative one: how much future innovation is foreclosed relative to the contribution of the inventor.” Mayo, 566 U.S. at 88, 132 S.Ct. at 1303.

The Court made clear, however, that “cases have not distinguished among different laws of nature according to whether or not the principles they embody are sufficiently narrow” because “[c]ourts and judges are not institutionally well suited to making the kinds of judgments needed to distinguish among different laws of nature.” Mayo, 566 U.S. at 88-89, 132 S.Ct. at 1303. As a result “cases have endorsed a bright-line prohibition against patenting laws of nature, mathematical formulas and the like, which serves as a somewhat more easily administered proxy for the underlying ‘building-block’ concern.” Mayo, 566 U.S. at 88-89, 132 S.Ct. at 1303.

In Mayo and Alice, the Court articulated a two-step analytical framework for determining whether a claim is directed to a patent-ineligible concept barred by this bright line-prohibition. The Court indicated that “[f]irst, we determine whether the claims at issue are directed to one of those patent-ineligible concepts.” Alice, 134 S.Ct. at 2355. If so, the test proceeds to “a search for an ‘inventive concept’ — i.e., an element or combination of elements that is sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept itself.” Alice, 134 S.Ct. at 2355 (internal quotations and alterations omitted).

However, it is important to keep in mind that this two-step analytical framework is only designed to determine whether a claim is directed to a patent-ineligible concept barred by this bright-line prohibition which “serves as a somewhat more easily administered proxy for the underlying ‘building-block’ concern.” Mayo, 566 U.S. at 89, 132 S.Ct. at 1303.

The bright-line eligibility prohibition should be narrowly construed, and the Mayo/Alice test implementing it only applied for concepts plainly and unmistakably within its terms and spirit.

As outlined above, the implicit statutory exception for abstract ideas should be construed “narrowly in order to preserve the primary operation of the provision,” Clark, 489 U.S. at 739 (citing Phillips, 324 U.S. at 493), as to do otherwise would risk “frustrat[ing] the announced will of the people.” Phillips, 324 U.S. at 493. Given that such a narrow construction is necessary for the implicit judicial exception itself (for “patents that claim the ‘buildin[g] block[s]’ of human ingenuity,” Alice, 134 S.Ct. at 2355 (citing Mayo, 566 U.S. at 89, 132 S.Ct. at 1303; Mayo, 566 U.S. at 72, 132 S.Ct. at 1294)), one must be even more careful in construing the “bright-line prohibition … which serves as a somewhat more easily administered proxy for the underlying ‘building-block’ concern.” Mayo, 566 U.S. at 89, 132 S.Ct. at 1303.

Analogously to Phillips, there is an argument that “[t]o extend [such a bright-line prohibition] to other than those [concepts] plainly and unmistakably within its terms and spirit is to abuse the interpretative process and to frustrate the announced will of the people.” Phillips, 324 U.S. at 493.

Here, one result of the Supreme Court’s very reasonable choice to decline to “labor to delimit the precise contours of the ‘abstract ideas’ category,” Alice, 134 S.Ct. at 2357, is that there are only a limited number of concepts which it is clear are “plainly and unmistakably within [the] terms and spirit,” Phillips, 324 U.S. at 493, of this bright-line prohibition.

CLICK to CONTINUE READING… In part two the article will address the fact that the bright-line eligibility prohibition was not intended to categorically prohibit patenting of everything which can be characterized as an abstract idea at some level, and suggest that it would be reasonable to only apply the Alice/Mayo two-step framework implementing this bright-line prohibition for concepts that the Supreme Court has “plainly and unmistakably [indicated to be] within [the] terms and spirit,” Phillips, 324 U.S. at 493, of the bright-line prohibition, e.g. mathematical formulas and fundamental economic practices that are long prevalent.

Image Source: Deposit Photos.