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APR 26 2018

USPTO Issues New Alice Guidance

On April 19, 2018, the United States Patent and Trademark Office (USPTO) issued a Memorandum (Subject Matter Eligibility Memo) providing additional guidance on examination procedures pertaining to subject matter eligibility under 35 U.S.C. § 1011 in view of the recent decision by the U.S. Court of Appeals for the Federal Circuit Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018). The Subject Matter Eligibility Memo indicates that the USPTO is determined to provide “clear and predictable patent rights” in this area of law (subject matter eligibility), and may issue “further guidance in the future.” The Subject Matter Eligibility Memo is a good attempt to address the inconsistent and often incorrect approaches that the examining corps has been taking in handling this area of the law.

Background

In 2014, the Supreme Court issued the now widely known Alice opinion2 providing details for the two-part test3 for determining subject matter eligibility under 35 U.S.C. § 101 for patent claims dealing specifically with computer-related inventions. In Alice, the Supreme Court said that in the first step for determining subject matter eligibility under 35 U.S.C. § 101, one must determine whether the claim is directed to an abstract idea.4 If so, then in the second step of the analysis for determining subject matter eligibility under 35 U.S.C. § 101, one must examine the elements of the claim to determine whether it contains an additional element or combination of additional claim elements sufficient to "transform" the claimed abstract idea into a patent-eligible application.5

The Subject Matter Eligibility Memo is focused on the second step of the two-part Alice test (i.e., whether the additional claim element or combination of additional claim elements represents well-understood, routine, conventional activity). If so, then the additional claim element would not be sufficient to transform the claimed abstract idea into patent-eligible subject matter.6 

In Berkheimer, the U.S. Court of Appeals for the Federal Circuit (Federal Circuit) held that in the inquiry under the second step, “the question of whether certain claim limitations represent well-understood, routine, conventional activity raised a disputed factual issue,” could not be determined on the basis of summary judgment, because such a question is a factual issue.7 The Subject Matter Eligibility Memo acknowledges that even though issues concerning civil litigation are generally inapplicable during the examination of a patent application, the Berkheimer decision provides useful information in the second step of the patent eligibility analysis.8

In Berkheimer, the Federal Circuit, under the first step, held that the claims were directed to abstract ideas similar to concepts found to be abstract in prior Federal Circuit decisions.9 The claimed invention in Berkheimer related to “digitally processing and archiving files in a digital asset management system.”10 Under the second step, however, the Federal Circuit in Berkheimer stated that claims 4-7 “contain limitations directed to purported improvements described in the specification.”11 The Court found that the specification described “that the system eliminates redundant storage of common text and graphical elements, which improves system operation efficiency and reduces storage costs.”12 Importantly, the Federal Circuit “caution[ed] that the mere fact that something is disclosed in a piece of prior art does not mean it was a well-understood, routine, conventional activity or element.”13

Examination Guidance Provided in the Subject Matter Eligibility Memo

The Subject Matter Eligibility Memo states that “only when the examiner can readily conclude that the element(s) is widely prevalent or in common use in the relevant industry” can the Examiner then find that the element is well-understood, routine, conventional activity.14 Notably, the Subject Matter Eligibility Memo specifically states, “The question of whether additional elements represent well-understood, routine, conventional activity is distinct from patentability over the prior art under 35 U.S.C. §§ 102 and 103.”15 In formulating a rejection in the second step analysis, the Subject Matter Eligibility Memo states that an additional element is not “well-understood, routine or conventional unless the examiner finds” one or more of four specific requirements.16

Specifically, these four requirements are:

  1. A citation to an express statement in the specification or to a statement made by an applicant during prosecution that demonstrates the well-understood, routine, conventional nature of the additional element(s). A specification demonstrates the well-understood, routine, conventional nature of additional elements when it describes the additional elements as well-understood or routine or conventional (or an equivalent term), as a commercially available product, or in a manner that indicates that the additional elements are sufficiently well-known that the specification does not need to describe the particulars of such additional elements to satisfy 35 U.S.C. § 112(a). A finding that an element is well-understood, routine, or conventional cannot be based only on the fact that the specification is silent with respect to describing such element.
  2. A citation to one or more of the court decisions discussed in MPEP § 2106.05(d)(II) as noting the well-understood, routine, conventional nature of the additional element(s).
  3. A citation to a publication that demonstrates the well-understood, routine, conventional nature of the additional element(s). An appropriate publication could include a book, manual, review article, or other source that describes the state of the art and discusses what is well-known and in common use in the relevant industry. It does not include all items that might otherwise qualify as a "printed publication" as used in 35 U.S.C. § 102.17 Whether something is disclosed in a document that is considered a "printed publication" under 35 U.S. C § 102 is a distinct inquiry from whether something is well-known, routine, conventional activity. A document may be a printed publication but still fail to establish that something it describes is well-understood, routine, conventional activity. See Exergen Corp., 2018 WL 1193529, at *4 (the single copy of a thesis written in German and located in a German university library considered to be a "printed publication" in Hall "would not suffice to establish that something is 'well-understood, routine, and conventional activity previously engaged in by scientists who work in the field'"). The nature of the publication and the description of the additional elements in the publication would need to demonstrate that the additional elements are widely prevalent or in common use in the relevant field, comparable to the types of activity or elements that are so well-known that they do not need to be described in detail in a patent application to satisfy 35 U.S.C. § 112(a). For example, while U.S. patents and published applications are publications, merely finding the additional element in a single patent or published application would not be sufficient to demonstrate that the additional element is well-understood, routine, conventional, unless the patent or published application demonstrates that the additional element are widely prevalent or in common use in the relevant field.
  4. A statement that the examiner is taking official notice of the well-understood, routine, conventional nature of the additional element(s). This option should be used only when the examiner is certain, based upon his or her personal knowledge, that the additional element(s) represents well-understood, routine, conventional activity engaged in by those in the relevant art, in that the additional elements are widely prevalent or in common use in the relevant field, comparable to the types of activity or elements that are so well-known that they do not need to be described in detail in a patent application to satisfy 35 U.S.C. § 112(a). Procedures for taking official notice and addressing an applicant's challenge to official notice are discussed in MPEP § 2144.03.18

In addition, the Subject Matter Eligibility Memo indicates that if the applicant challenges the Examiner’s taking of official notice (as indicated in requirement [4] above), then the Examiner must provide one of the other requirements ([1] – [3] above) or an affidavit or declaration “setting forth specific factual statements and explanation to support [the Examiner’s] position.”19

Conclusion

The Subject Matter Eligibility Memo serves as an important document to cite to for a practitioner when responding to a rejection under 35 U.S.C. § 101, because the Office now requires an Examiner to find factual support for an assertion that an element is well-understood, routine, or conventional in the second step analysis for determining subject matter eligibility under 35 U.S.C. § 101. As many practitioners have found over the years since the Alice decision, arguments presented by an Examiner in a rejection under 35 U.S.C. § 101 frequently confuse the issue of patent eligibility and prior art. The Subject Matter Eligibility Memo attempts to put an end to this confusion by stating that there is a distinction when considering whether a claim element is well-understood, routine, or conventional rather than being taught in the prior art.

The Subject Matter Eligibility Memo lays out four specific factual determinations that the Examiner must consider before finding that a claim element is well-understood, routine, or conventional. Practitioners should carefully check whether an Examiner’s reasoning falls in line with at least one of the four requirements (see above) provided by the Office in determining whether a claim element is well-understood, routine, or conventional. If the Examiner’s reasoning falls short of this, the practitioner should indicate as such on the record in response to the next office action, while citing to the Subject Matter Eligibility Memo.

  1. “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.” 35 U.S.C. § 101.
  2. Alice Corp. v. CLS Bank International, 573 U.S._,_, 134 S. Ct. 2347, 2352 (2014).
  3. In Alice, the Supreme Court identified two steps (step 1 and step 2) from Mayo v. Prometheus, 132 S. Ct. 1289 (2012) for determining subject matter eligibility under 35 U.S.C. § 101 for patent claims. In the MPEP, the USPTO categorizes these two steps identified by the Supreme Court as step 2A and step 2B, respectively. See MPEP §§ 2106 (III), 2106.04(II), 2106.05. The MPEP identifies step 1 as follows: “Is the claim a process, machine, manufacture, or composition of matter?” See MPEP §§ 2106 (III), 2106.03.
  4. Alice, slip op. at 7
  5. Id. at 11 (citing to Mayo v. Prometheus, 132 S. Ct. 1289 (2012)).
  6. Subject Matter Eligibility Memo at 1.
  7. Id.
  8. Id. at 1-2.
  9. Id. at 2.
  10. Id.
  11. Id.
  12. Id.
  13. Id. (citing to Berkheimer at 1369).
  14. Id. at 3.
  15. Id.
  16. Id. at 3-4.
  17. Footnote 3 of the Subject Matter Eligibility Memo at 4: “See, e.g., In re Klopfenstein, 380 F.3d 1345 (Fed. Cir. 2004) (publicly displayed slide presentation); In re Hall, 781 F.2d 897 (Fed. Cir. 1986) (doctoral thesis shelved in a library); Mass. Inst. of Tech. v. AB Fortia, 774 F.2d 1104, 1108-09 (Fed. Cir. 1985) (paper orally presented at a scientific meeting and distributed upon request); In re Wyer, 655 F.2d 221 (CCPA1981) (patent application laid open to public inspection).” 18 Subject Matter Eligibility Memo at 3-4.
  18. Id. at 4-5.
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