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Has Alice Returned from Wonderland?

The US Supreme Court’s decision on patent eligibility and abstract ideas in Alice [1] caused over two years of uncertainty for inventors, applicants and attorneys as to whether computer-implemented inventions could still be patented.  The Alice decision has been applied by USPTO Examiners to patent applications in a somewhat haphazard manner, causing the USPTO to issue a series of guidance notes to the Examiners.  Thankfully, recent decisions from the US Federal Circuit suggest the tide is turning and that the Alice approach to determining patent eligibility is becoming more sensible.

In this article, we provide an overview of these recent decisions and outline how this may affect patent drafting for computer-implemented inventions.  This article has kindly been peer-reviewed by Matthew Grady, a US intellectual property attorney and shareholder at Wolf, Greenfield & Sacks, P.C. [2].

Brief background

In Alice, the US Supreme Court applied the framework for determining patent eligibility (which was described in Mayo v. Prometheus) to software inventions/computer-implemented inventions.  Specifically, the Court stated that “method claims, which merely require generic computer implementation, fail to transform an abstract idea into a patent eligible invention” [3].  In other words, if a claim relates to an abstract idea that is implemented using generic computer functions, the claim will be considered patent ineligible.  The courts have found the following computer functions to be well-understood, routine and conventional when claimed in a generic manner: performing repetitive calculations; receiving, processing and storing data; electronically extracting data from a physical document; electronic record keeping; automating mental tasks; and receiving/transmitting data over a network.

The Alice decision confirmed that in order to determine if an invention is patent eligible, the Mayo framework is to be applied to all types of inventions.  The Alice/Mayo framework provides a two-step approach to patent eligibility:

(1) it must be determined whether a claim is directed to a judicial exception, such as a law of nature, a natural phenomenon, or an abstract idea, and if so,

(2) it must be determined whether any element, or combination of elements, in the claim is sufficient to ensure that the claim as a whole amounts to significantly more than the judicial exception.  In other words, it must be determined if the invention includes an inventive concept that is sufficient to transform the abstract idea into a patentable invention.  If the answer at this step is no, the claim is patent ineligible and will be rejected under 35 U.S.C. 101.

Guidance notes on how the USPTO applies this framework to patent applications, and examples of subject matter the USPTO considers to be patent eligible, can be found on the USPTO website [4].

The effect of the Alice decision, even after the USPTO released their guidance notes, was considerable uncertainty about whether patent applications relating to software and business methods would still be patentable.  The impact on cross-disciplinary inventions, such as bioinformatics, was also unclear.

For European patent attorneys, the Alice/Mayo two-step framework feels quite familiar, and has reinforced the European approach to patent drafting.  This is because the second step in the framework appears to ask whether a technical improvement or technical effect is provided by the claimed invention.  When drafting patent applications, European patent attorneys tend to ask the applicant/inventors about what technical problem an invention is trying to solve, and what technical solution the invention provides for that problem.  European patent attorneys often provide a discussion of the technical problem and technical solution in the patent application itself, or at least provide indications of what technical advantages the solution provides, as this can help EPO Examiners understand the context of the invention, particularly when they are considering whether the invention is inventive/non-obvious.  Nevertheless, European patent attorneys have worried whether this approach would work in the US, or whether USPTO Examiners would reject a patent claim under 35 U.S.C. 101 if the claim simply looked like it was patent ineligible, without considering what problem an invention sought to solve or the described advantages of a computer-implemented method.

The first glimmer of hope: DDR Holdings (2014)

Until relatively recently, attorneys battling a patent eligibility rejection usually cited DDR Holdings [5] which was the first (and for a long time, only) post-Alice case in which the Federal Circuit found the patent claims at issue to meet the requirements of 35 U.S.C. 101.

Specifically, DDR Holdings was the first time since Alice that claims directed to a computer-implemented invention were found to be patent eligible.  In DDR Holdings, the invention related to what happens when a user clicks on a third party link on a host website.  In the prior art, the user is taken to the third party’s website, such that they leave the host website entirely.  In the claimed invention, a user was directed to a composite web page on the host website itself, which advantageously means that the host website can display a third party’s products etc. while retaining user traffic.

In this case, the Federal Circuit judges stated that the invention is internet-specific, and that there is no corresponding offline equivalent.  That is, the claims in suit did not merely recite a pre-internet way of doing business that was now being performed on the internet.  Instead, the patentee solved a technical problem that specifically arises in the realm of computer networks, i.e. the problem of retaining website visitors when the conventional function of internet hyperlinks causes visitors to instantly be transported away from the website.

The DDR Holdings decision was important for a number of reasons.  Firstly, it meant that computer-implemented inventions or software inventions may continue to be patent eligible post-Alice, if the invention creates new computer functions or uses a computer in an unexpected or non-routine way.  Here, the claimed invention was held to provide an invention that is not a routine or conventional use of the internet.  This decision resonates with the European approach to determining patent eligibility for software.  Secondly, the decision is important for inventions that are either business methods or which are framed in a business context, because while the claimed invention here related to a business problem, the problem was specific to the internet and was therefore, not a “fundamental economic or longstanding commercial practice”.

2016: a good year for software patents

This year, attorneys dealing with software or computer-implemented inventions (as well as bioinformatics) have collectively let out a huge sigh of relief following a series of US Federal Circuit decisions on patent eligibility.

Firstly, in May 2016 the Federal Circuit decision in Enfish v. Microsoft [6] stated that the claimed database software and data-structure invention is patent eligible.  The judges stated that they do not think that “claims directed to software…are inherently abstract…Software can make non-abstract improvements to computer technology just as hardware improvements can…We thus see no reason to conclude that all claims directed to improvements in computer-related technology, including those directed to software, are abstract…”.  Interestingly, the judges took a somewhat European (and rather British) approach to deciding patent eligibility, as they stated that it is “relevant to ask whether the claims are directed to an improvement to computer functionality versus being directed to an abstract idea”.  In Enfish, the claims at issue are directed to a self-referential table for a computer database, and the patent itself states the numerous advantages of such a self-referential table.  For example, Enfish’s patent US 6,151,604 states that the invention provides “an improved database architecture”, and that the invention “overcomes the limitations of both the relational database model and object oriented database model by providing a database with increased flexibility, faster search times and smaller memory requirements”.  The Federal Circuit judges appear to have given such teachings within the patent some weight when considering patent eligibility, as these passages not only indicate what technical problem(s) the invention sought to solve, but also list the technical effects or advantages of the invention.

The Enfish decision was considered so important and useful that the USPTO issued new guidance [7] for Examiners to enable them to apply the approach taken in Enfish.  Specifically, the new guidance places more importance on comparing the invention to the prior art, cautions against a high-level view of the claims which removes all context and meaning from the claims, and rejects the premise that using a computer automatically renders a claim patent ineligible.

Secondly, in June 2016, the Federal Circuit held in BASCOM v AT&T [8] that a claim directed to a technique for filtering internet content is patent eligible subject matter.  BASCOM’s patent US 5,987,606, starts by describing the technical problems or disadvantages associated with providing filtered internet content to a user at the priority date of the application.  For example, some existing techniques could easily be thwarted by computer-literate end users, some were hardware or operating system specific, and some could only implement a single set of filtering criteria for all users.  The claimed invention provided a technique to enable customisable filtering that is unique to each user, and which is implemented at a remote internet service provider server (and so could be agnostic to the end user’s computer hardware or O/S).  The solution enables the ISP to associate an individual user with that user’s filters/preferences.  While the District Court decided that the claims recited a generic computer which was not inventive by itself, the Federal Circuit judges overturned this decision and stated that BASCOM “does not assert that it invented local computers, ISP servers, networks, network accounts, or filtering. Nor does the specification describe those elements as inventive”.  Just like in Enfish, the judges referred to the patent itself, which described the inventive concept as being the installation of a filtering tool at a specific location, remote from the end-users, with customizable filtering features specific to each user.  This design gives the filtering tool both the benefits of a filter on a local computer and the benefits of a filter on the ISP server.

BASCOM is interesting not only because it reinforces the Enfish approach to determining patent eligibility, but it also places emphasis on the patent describing a specific way of implementing an idea.  Specifically, in the decision the judges state that the claims “do not merely recite the abstract idea of filtering content along with the requirement to perform it on the internet…nor do the claims preempt all ways of filtering content on the internet; rather, they recite a specific, discrete implementation of the abstract idea of filtering content”.  This case, as well as DDR Holdings, reinforce the importance of providing a detailed description of how the invention will be implemented in reality.  In other words, a broad claim supported by one or more specific, detailed embodiments that explain how the invention can be put into practice will appear more patent eligible than a broad claim supported by a generic, non-specific description.

Most recently, on 13th September 2016 the Federal Circuit held in McRO v. Bandai Namco, et al. [9] (also known as the “Planet Blue” case) that software patent claims are patent eligible.  In this case, the invention at issue is directed towards a problem within computer animations, specifically that of being able to animate facial expressions and lip synchronization.  In the past, animators would effectively determine themselves what an animated face should look like at each point in time in order to animate the lips and facial expressions of an animated character.  This approach is understandably time consuming and subject to human error.  The invention at issue aimed to overcome the prior art problems and provide a technique for rapid, efficient lip synchronisation that is less reliant on an animator.

In the decision, the judges disagreed with the District Court’s opinion that the claims related to an abstract idea because they believed that the lower court had oversimplified the claims.  Rather, the Federal Circuit judges found that the invention provides mathematical rules that would enable more accurate lip synchronisation than is achievable using a human animator, and that importantly, the claims are limited to these rules.  The judges note that the patent itself states the technical effect of the invention is to produce accurate and realistic lip synchronisation and facial expressions in animations that human animators could not produce.  Furthermore, the judges note that the limitations within claim 1 of the patent at issue “prevent preemption of all processes for achieving automated lip-synchronization of 3-D characters”, such that the claim as a whole is directed to a specific technological improvement over the prior art.  The decision states that the claim “uses the limited rules in a process specifically designed to achieve an improved technological result” such that the claim is not directed to an abstract idea, and such that the second step in the Alice/Mayo framework does not need to be considered.

The Planet Blue decision follows the Enfish approach and makes it clear that it is possible to overcome an objection under 35 U.S.C. 101 by simply explaining that the invention is not directed to an abstract idea (under the first step of the Alice/Mayo framework).  If the invention provides a technical effect, and if this technical effect is recited in the claims, then the claim when taken as a whole is not directed to an abstract idea.

How does this affect your chances of obtaining a US patent?

Not all of the recent Federal Circuit decisions on software cases are positive.  In TLI Communications [10], the invention at issue relates to an apparatus for recording a digital image, communicating the recorded digital image to a storage device, and organising/archiving the digital images within the storage device so that information can be easily tracked.  In TLI Communications, the Federal Circuit found that the claims were not directed to a specific improvement in computer functionality, and that the telephone, camera and server used to implement the invention were not new, such that the claims were “simply directed to the abstract idea of classifying and storing digital images in an organized manner”.  The court held that since the recited physical components “behave exactly as expected according to their ordinary use”, the mere implementation of an idea using generic components “cannot confer patent eligibility”.  This case indicates that even if an invention is solving a technical problem (e.g. how to classify and store images in an organised manner), the solution itself may not be patent eligible if it is implemented using standard physical components that operate in a usual, expected manner.

Furthermore, although the USPTO is theoretically bound by the decisions of the US courts, under the US common law system, we have found that until the USPTO issues guidance notes to Patent Office Examiners explicitly instructing them to heed the decision or approach within a particular case, the Examiners do not always do so.  The USPTO swiftly issued a guidance note following the Enfish and TLI Communications decisions, but has not yet issued any similar guides following BASCOM, or Planet Blue.  Further still, the guidance note is non-binding and is merely a guide for Examiners.

Unfortunately, this means that even if we point an Examiner towards the positive decisions in Enfish, BASCOM or Planet Blue, the Examiner may continue to allege that a claim is patent ineligible during prosecution before the USPTO.  We hope that the USPTO will at least update their guidance in view of the recent cases on patent eligibility, but until this occurs, arguing against a patent eligibility objection on the basis of this case law may not be sufficient to overturn the objection.

While we wait for the USPTO to take these recent decisions into account, there are steps we can take at the patent drafting stage to reduce the chance of receiving a 35 U.S.C. 101 objection, and/or improve the chance of overturning such an objection during prosecution.

Perhaps out of fear of litigation in the US, and of estoppel, recent patent applications originating from both sides of the Atlantic appear to be drafted with minimal reference to the prior art, and a fleeting mention (if any) of the technical problem and the advantages of the invention.  However, the recent Federal Circuit approach to determining patent eligibility suggests that it is useful to explicitly explain the technical problem and technical solution or advantages within the patent application itself.  This enables Patent Office Examiners and courts to readily place the claim in context and better understand the motivation behind the invention.  Therefore, we recommend that serious consideration is given to using (or returning to using) the traditional European approach to patent drafting, in which the problem and solution is explicitly explained in the patent application.  Of course, even when a clear technical problem and technical solution is described in the patent application, it is still more challenging to obtain patent protection than pre-Alice.

The European patent attorneys at TLIP are well-versed in drafting patent applications by identifying the technical problem and the technical solution provided by an invention to that problem.  We can offer our insight into how best to describe and claim an invention which relates to software and computer-implemented inventions.  We are happy to provide advice prior to filing a patent application, to place the application in a better position for grant in the US and Europe.

Please contact us at mail@tlip.co.uk for confidential advice if you believe your patent portfolio may be affected by the issues described above.


[1] Alice Corp. v. CLS Bank International, 134 S. Ct. 2347 (2014)

[2] This article has kindly been peer-reviewed by Matthew Grady, a US intellectual property attorney and shareholder at Wolf, Greenfield & Sacks, P.C. Matthew’s profile can be found here: http://www.wolfgreenfield.com/professionals/g/grady-matthew

[3] Page 10, final paragraph in the Supreme Court opinion in Alice

[4] USPTO guidance notes on subject matter eligibility

[5] DDR Holdings, LLC v. Hotels.Com, L.P. (Fed. Cir.2014)

[6] Enfish, LLC, v. Microsoft Corp., et al. (Fed. Cir. 2016)

[7] USPTO memorandum of 19th May 2016

[8] BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC, et al. (Fed. Cir. 2016)

[9] McRO v. Bandai Namco, et al. (Fed. Cir. 2016)

[10] TLI Communications LLC, v. A. V. Automotive, LLC (Fed. Cir. 2016)