Many actual and potential patent owners are concerned about whether software is patentable in the US, based on ambiguities created by the courts and the U.S. Patent and Trademark Office (USPTO) about the meaning of Section 101 of the US Patent Act, which defines the scope of patentable subject matter. In this article, we at Blueshift IP provide an overview of the law for in-house counsel and hope to give reassurance that it is possible to obtain strong, broad, and defensible software patents in the US, despite uncertainty about the precise boundaries of Section 101.
Section 101 of the Patent Act says an inventor can patent “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” In 1790, legislators were keen to not rein in innovation, hence the use of “any.” But the founding fathers could not have imagined the world in the 21st century or the confusion that three-letter word would cause.
This confusion has had a significant impact on software patents over the years. In particular, the U.S. Supreme Court (SCOTUS), the Court of Appeals for the Federal Circuit (CAFC), and lower courts have interpreted Section 101 to exclude certain types of products and processes from patent protection in ways that have shifted unpredictably over time. During some periods, the courts have interpreted Section 101 relatively broadly to allow a wide range of software to be patented, while during other periods they have restricted the scope of Section 101 relative to software. To make matters more complex, the USPTO often interprets Section 101 in ways that do not align with the courts’ interpretations. One consequence of this is that attempting to patent software has always required expert and up-to-date knowledge of the current interpretations of Section 101 by both the courts and the USPTO in order to maximize the likelihood of obtaining strong, broad, and defensible software patents.
SCOTUS had the opportunity to clarify what is patent-eligible when it introduced a two-prong test in the wake of Mayo v. Prometheus. However, the vague language, SCOTUS’ unwillingness to take up related cases, and lower courts issuing conflicting rulings since then mean ongoing legal headaches for innovators and those who help them protect and monetize those innovations.
In this blog post, we will discuss some of the issues around Section 101 and what companies should be doing given the lack of guidance from SCOTUS and the U.S. Congress.
What Makes an Invention Patent-eligible?
For an invention to be considered patent-eligible, it must fall under one of the four statutory categories:
- Process: “An act, or series of facts or steps”
- Machine: “A concrete thing, consisting of parts, or of certain devices and combination of devices…”
- Manufacture: “An article produced from raw or prepared materials by giving these materials new forms, qualities, properties, or combinations, whether by hand labor or by machinery…”
- Composition of matter: “All compositions of two or more substances and all composite articles, whether they be the results of chemical union, or of mechanical mixture, or whether they be gases, fluids, powders or solids…”
If an invention falls into one of the categories above, it is patent-eligible. Software patent claims typically fall into the process or manufacture categories (such as when software is claimed as stored on a computer-readable medium).
If an invention does not fall into one of the categories above, the second test, below, must be applied.
- The invention must not be entirely a subject matter that encompasses a “judicially recognized exception,” which are:
- Laws of nature
- Natural phenomena
- Abstract ideas
In 2014, SCOTUS introduced a two-prong test that asks if the claim is directed at a “judicially recognized exception” noted above:
- If the answer is no, the claimed innovation is patent-eligible.
- If the answer is yes, the claim is further examined to determine whether additional elements recited in the claim transform it into a patent-eligible application by introducing an “inventive concept” that is “sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.”
Unfortunately, SCOTUS refused to define terms like “abstract,” which only further complicated things. When software patent claims are rejected under Section 101, it is most often because they are alleged to be directed to an abstract idea without adding “significantly more.” When the software patent attorneys at Blueshift IP respond to these rejections, we typically focus on demonstrating that the claimed software invention does add something “significantly more,” e.g., in the form of a combination of steps that solve a problem in a new way or that provide a benefit that no previous invention has provided.
In 2019, the U.S. Patent and Trademark Office (USPTO) issued its Interim Guidance, which noted “abstract ideas” should fall into three categories:
- Mathematical concepts
- Certain methods of organizing human activities
- Mental processes
With the lack of guidance, and courts unwilling to provide further clarity, the USPTO has settled into a relatively stable way of interpreting Section 101, although there can still be significant variability among patent examiners. In our experience, we have found that the 2019 USPTO Interim Guidance has provided significantly more certainty to the examination of software patent claims under Section 101. As a result, we have seen a significant decrease since 2019 in the number of rejections we have received under Section 101 and a significant increase in our ability to overcome those rejections when we receive them.
What Should Companies Be Doing Now, Given that the Courts Are at a Standstill?
The legal standards governing patent eligibility of software inventions in the U.S. have varied widely over the years and will continue to do so. It is critical that companies consult with IP attorneys who are familiar with the shifting sands of eligibility, like the software patent attorneys at Blueshift IP.
Going forward, innovators need to work with their legal advisors to write patent applications that are as likely as possible to satisfy the legal requirements for patent eligibility, even if those requirements change in the future. Blueshift IP attorneys focus on writing our patent applications to satisfy a wide range of different legal requirements – even if not all those requirements are applicable right now. The point of taking this “belt and suspenders” approach is an example of what engineers call “building in redundancy” to avoid a “single point of failure.” The goal is to make our patent applications robust against future and unpredictable changes in the law.
We have witnessed enough swings of the pendulum back and forth between expansive and narrow interpretations of patent-eligibility under Section 101, and have observed interpretations of enough similar legal standards in other countries, to know how to build in those layers of protection in the patent applications that we write in order to protect our clients against a wide range of current and possible future interpretations of Section 101. This approach will be familiar to those of you who draft contracts – although you cannot predict the future with certainty, you can build in defenses to protect against the vast majority of contingencies. Just as when drafting contracts, it is extremely important when drafting patent applications to include those defenses from the outset because, once a patent application is filed (just as once a contract is signed), your options for amending that patent application become extremely limited. That is why it is extremely important to work with patent counsel who can build those defenses into your patent portfolio based on knowledge of the current state of the law and an expansive understanding of possible future developments in the law.
What Are Blueshift IP Attorneys’ Predictions for What’s Next?
Physicist Niels Bohr famously said, “Prediction is very difficult, especially if it’s about the future.”
Legislation to fix the issues with Section 101 would be a welcome surprise, but no one is going to hold their breath. Senator Thom Tillis (R-NC) recently introduced his Patent Eligibility Restoration Act, which aims to cut down on the number of exceptions to patent eligibility. It sounds promising, but critics have noted the legislation leaves out emerging fields like artificial intelligence, the internet of things, biotechnology, pharmaceuticals, and most software innovations. It is not expected to gain any traction.
Additionally, SCOTUS and the Court of Appeals for the Federal Circuit (CAFC) have not shown themselves willing or able to provide certainty about the meaning of Section 101. And the USPTO seems to have differences in interpretation between examiners.
Blueshift IP’s Robert Plotkin notes, “It is clear that changes will not be coming from on high, at least for the time being.” Therefore, “success” (in the form of strong and defensible patents) is going to have to come from individual patent applicants, and their patent attorneys, drafting and prosecuting solid patent applications on a case-by-case basis. Some of those patents might form the basis for cases in federal district court that could help shape the law a few years down the road.
The attorneys at Blueshift IP are well-versed in how patents, patent law, and this type of expertise is vital to promoting innovation. If you are interested in learning more about discussing options for protecting your patentable inventions, reach out to us at firstname.lastname@example.org.