USPTO Report Underscores Split on State of U.S. Patent Eligibility Jurisprudence

“While the guidance on patent eligibility issued by former USPTO Director Andrei Iancu has been helpful, it has not resulted in the necessary predictability or consistency because a) it is not binding on the courts and b) USPTO examiners do not always apply the guidance consistently, said the report.” U.S. Patent and Trademark Office (USPTO) has published its study on patent eligibility jurisprudence in response to a March 2021 request from Senators Thom Tillis (R-NC), Mazie Hirono (D-HI), Tom Cotton (R-AR) and Chris Coons (D-DE). The study, titled “Patent eligible subject matter: Public views on the current jurisprudence in the United States,” is based on more than 140 comments received following a USPTO request of July 9, 2021, and unsurprisingly concluded that many (mostly larger) high-tech and computer-related companies like the current state of the law; life sciences, startups and SMEs do not; but everyone agrees that consistency, clarity and predictability are needed. The study did not make any recommendations, and indicated that the Office will be continuing to solicit feedback via listening sessions and written comments and that it is also broadening the scope of stakeholders it reaches out to.

In their March letter to then-Interim Director of the USPTO, Drew Hirshfeld, the senators expressed concern about the state of patent eligibility jurisprudence, saying it has resulted in “a lack of consistency and clarity” in patent eligibility law. They said that, in order for the United States to continue leading in technology sectors such as quantum computing, artificial intelligence, 5G, the internet of things, biopharmaceuticals, precision medicine, and life sciences, “we can no longer continue to ignore the fact that current eligibility jurisprudence has had a dramatic negative impact on investment, research, and innovation.” The letter continued:

The lack of clarity has not only discouraged investment in critical emerging technologies, but also led the courts to foreclose protection entirely for certain important inventions in the diagnostics, biopharmaceutical, and life sciences industries.

The senators specifically called for data on how cases like Alice Corp. v. CLS Bank International and Mayo Collaborative Services Inc. v. Prometheus Laboratories Inc. have “adversely impacted investment and innovation in critical technologies like quantum computing, artificial intelligence, precision medicine, diagnostic methods, and pharmaceutical treatments.”

The Comments are In

The 140+ comments received represented the following broad categories of stakeholders, according to the report:

  • 43 comments from associations, nonprofit entities, and other advocacy groups;
    • 21 comments from companies and businesses;
    • 16 comments from law firms and practitioners;
    • 9 comments from academics, healthcare institutions, and universities; and
    • 34 comments from individuals, including inventors and patent applicants, and other entities that did not fit one of the aforementioned categories.

The Pros: Patent Law is A-Ok

Of those who weighed in to say that the current state of the law is sufficiently clear, the report cited commenters including the American Civil Liberties Union (ACLU), the High-Tech Inventors Alliance (HTIA), the Intellectual Property Owners Association (IPO), the Sofware & Information Industry Association (SIIA) and the Computer & Communications Industry Association (CCIA), among others. Claims made by those commenters included that the Federal Circuit affirms ineligibility decisions by district courts and the USPTO at a high rate; that applications are rejected for lack of eligibility at about the same rate post-Alice as prior;  and that the Supreme Court’s decisions in Alice and Mayo have improved predictability and help to foster scientific research and innovation. They also said the new jurisprudence has encouraged better quality applications.

The Cons: It’s Past Time for a Fix

However, the section on those who feel the law is unclear and unpredictable was about twice as long as the section on those who approve of it, and included citations to the comments of IBM, The App Association, the American Intellectual Property Law Association (AIPLA), the New York Intellectual Property Law Association (NYIPLA), U.S. Startups & Inventors for Jobs (USIJ), AUTM and Innovation Alliance, among others. These commenters explained that the AliceMayo test for determining patent eligibility is unworkable because it relies on subjective reasoning and often results in “arbitrary determination[s]”; that the Federal Circuit judges themselves have written that they “are ‘at a loss’ as to how to apply section 101,” have literally “begged the Supreme Court  and Congress to provide more clarity” and have referred to the law as having “destabilized technologic development in…all fields”; and that the trajectory of Section 101 law promises to even further destabilize things as we still await decisions in cases such as American Axle and in light of other cases such as Yu v. Apple, Inc.

While the guidance on patent eligibility issued by former USPTO Director Andrei Iancu has been helpful, it has not resulted in the necessary predictability or consistency because a) it is not binding on the courts and b) USPTO examiners do not always apply the guidance consistently, said the report. The latter issue has made prosecution very art unit dependent, said commenters. The Public Interest Patent Law Institute (PIPLI) further claimed that “there is… evidence that the revised guidance is leading to the allowance of patent claims that are ineligible under Alice.”

Little Common Ground

The report further outlines the varying comments as they pertain to “Impacts on innovation, investment, and competition”, “Impacts on legal costs”, “Impacts on access to technical information”, “U.S. global leadership and national security implications”, and “Impacts on technology-specific sectors”. The views in each of these areas almost universally contradict one another based on whether one is for or against the current state of U.S. eligibility law. For example, those in favor of the current jurisprudence said that the law promotes innovation by curbing patents on “basic ideas” and providing more access to information while those against the current state of the law argue it has jeopardized the ability to innovate in certain key areas, including precision medicine, pharmaceutical treatments and diagnostics. Those who are happy with the current law also said litigation costs have been reduced, while those who want changes say it has increased costs.

The technology sectors that have been most affected by the jurisprudence are 1) Life sciences (diagnostics, precision medicine and gene-based technologies); 2) Computer-related technologies (AI, quantum computing and machine learning); and Mechanical and future technologies. Many commenters in these areas noted that they are no longer seeking patent protection and are instead turning to trade secrets.

About the only thing the commenters agreed on was that certainty is important to a functioning patent system.

Commenting on the report, USPTO Director Kathi Vidal said: “Innovation cannot thrive in uncertainty. We are committed to making every effort to ensure that the U.S. patent system is as clear and consistent as possible. We are analyzing our own patent eligibility guidance put in place in 2019, implementing the pilot program for deferred examination of patent eligibility, and considering guidance on functional claiming.”

Updated June 29, 2022 to clarify that not all high-tech and computer-related industries were in favor of current patent eligibility jurisprudence.

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Author: kevron2002
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Join the Discussion

4 comments so far.

  • [Avatar for concerned]
    June 29, 2022 06:48 am

    Pro say:

    I agree about hearings and televised them like Judge Judy. Even Judge Judy asks, reviews and rules on evidence.

    Let the public see that judges add words to the constitution and statutory texts and then hide behind stare decisis. The Solicitor did exactly that…hid behind stare decisis…that was her total argument during my oral CAFC arguments.

    I did not receive due process if my evidence is not considered and the added words to the statutory text are never defined, even though said definitions were requested numerous times to no avail. How can anyone defend against such a capricious process?

    I believe even double jeopardy can be overcome if the original trial was rigged and jeopardy never really attached in the first place. Stare decisis should also be overcome if the original ruling was unconstitutional (i.e. judges legislating from the bench.)

  • [Avatar for concerned]
    June 28, 2022 07:46 pm

    When the USPTO and its Board tell an inventor that his process meets the law as expressly written by Congress, solves a long sought business problem, and meets s102, s103 and s112 and still has his patent application rejected, of course there is a problem with the patent system.

    My attorney filed the R28j letter today citing Dobbs. SCOTUS in Dobbs said judges have no right to engraft their views and personal views unto the constitutional (statutory) text.

    What major patent cases since 1952 did the courts NOT add their views and words to the statutory text?That was a retortical question.

    If I met the law passed by our elected officials and still no patent, then I must not be meeting the “so-called” law of our appointed court officials. And the Board told me as much, no kidding!

    At least one of the three CAFC judges said my arguments should be in front of SCOTUS. Good for him!

  • [Avatar for Pro Say]
    Pro Say
    June 28, 2022 07:41 pm

    What we need is hearings, I say, hearings!

    You know; with lots and lots of witnesses!

    To find out what all the stakeholders want!

    Oh, wait . . . Congress already conducted that dance . . .

    In the years since the hearings . . . the CAFC and PTAB have continued to drag America to 3rd world innovation status.

    The solution is simple, Congress:

    Either abolish the unnecessary Section 101 (102, 103, and 112 work wonders) . . . or use your Constitutional authority to abrogate the unconstitutional Mayo and Alice decisions . . . in order to restore patent protection to all fields of innovation.

    Bam! American innovation is back.

  • [Avatar for Anon]
    June 28, 2022 07:16 pm

    This: “and unsurprisingly concluded that high-tech and computer-related companies like the current state of the law” needs a major caveat as many of my clients fit those designations and are very much at the opposite end of that sentiment.

    One possible editing change: “… concluded that Efficient Infringers, such as already established Big Tech ( high-tech and computer-related companies) like the current state of the law”