What does patent ineligible mean?

Not everything is patentable. US courts have recently drawn a line between eligible versus ineligible subject matter for patent protection. The problem is that line hasn’t been very clear.

A rejection under 35 USC Section 101 means that the patent examiner believes what is claimed is ineligible for patenting.

Eligible vs. Novel/Nonobvious

Patent eligibility is technically not the same as novelty or nonobviousness. However, the novelty and nonobviousness of a claim can improve its eligibility as discussed below.

What did Alice do?

In 2014, the US Supreme Court handed down a decision that has perplexed patent attorneys ever since: Alice Corp. v. CLS Bank Int’l. In Alice, the Court provided a multi-step test for determining whether subject matter was patent eligible:

Step 1: Is the claim directed to a process, machine, manufacture or composition of matter?

  • If no, then claim is not eligible subject matter
  • If yes, then go to Step 2A

Step 2A: Is the claim directed to a law of nature, a natural phenomenon, or an abstract idea (judicially recognized exceptions)?

  • If no, the claim is eligible subject matter
  • If yes, then go to Step 2B

Step 2B: Does the claim recite additional elements that amount to significantly more than the judicial exception?

  • If no, the claim is not eligible subject matter
  • If yes, the claim is eligible subject matter

What is an “abstract idea”?

Since Step 1 is almost always answered in the affirmative, the Alice test has become known as essentially a two-step test where the first step (2A) centers around the issue of an abstract idea. Most claims rejected under Section 101 are not directed to laws of nature or natural phenomena, so the “abstract idea” exception seems to be the most common pitfall of many software and business method patent applications. Under Step 2A above, if the examiner believes your claimed invention is directed to an abstract idea, then something significantly more is necessary under Step 2B to make the invention eligible.

Until more recently, nearly all software patent applications have been routinely judged by PTO examiners as covering an “abstract idea,” thereby necessitating an analysis under the second step (2B). That “significantly more” inventive concept has been elusive to define and apply.

Enter Enfish – Not an “abstract idea,” therefore patent eligible

Enfish, LLC v. Microsoft Corporation was a post-Alice case decided by the US Court of Appeals for the Federal Circuit (CAFC). Enfish made it possible for software inventions not be to an “abstract idea.” Thus, Enfish swung the pendulum towards eligibility. For software and computer related inventions, it meant that the multi-step test could conclude at the first step (2A) by deciding that a claimed invention would be eligible because it was not directed to an abstract idea in the first place. No further inquiries into something “significantly more” under the second step (2B) would be required.

Enfish has enabled applicants to rebut the once prevalent assumption that inventions were automatically directed to an abstract idea simply because software or computer technology were involved.

BASCOM: If “abstract idea,” then what is “significantly more”?

But, what if you need to find something “significantly more” because the examiner is convinced that the claimed invention is directed to an abstract idea? BASCOM Global Internet Services, Inc. v. ATT Mobility, LLC was an encouraging second step (2B) case decided by the CAFC after Enfish in June 2016. BASCOM sheds light on the second step, providing support for what could possibly be “significantly more” in order to make an abstract idea eligible.

The Federal Circuit in BASCOM held that an “inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces.” In other words, just because each component of a claim may be known or generic, it is still possible for the claim to satisfy the inventive concept requirement of the second step by having a unique combination of known components. BASCOM helps to swing the pendulum a bit more towards patent eligibility by providing some ammo for arguing the presence of an inventive concept.

Let’s see what the future holds.

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Vic Lin

Vic Lin

Startup Patent Attorney | IP Chair at Innovation Capital Law Group
We love working with startups and small businesses. I help entrepreneurs protect their intellectual property so they can reach their business goals.
Vic Lin

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