The Supreme Court of the U.S. has agreed to review the Bilski case discussed below. The Bilski case disavowed the controversial State Street Bank decision and severely limited the possibility of obtaining business method patents and put the validity of many into question. It also affects software cases that do not describe a lot of hardware, and, in fact, is relevant to all method cases.
The Bilski decision set forth a requirement that any process claim in a patent must be tied to a particular machine or apparatus, or transform a particular article into a different
state or thing ("machine-or-transformation" test), to be eligible for patenting under 35 U.S.C.
§ 101.
It seems likely that the Supreme Court will at least partially reverse. The Supreme Court would not take the case up for review unless it had something to say.
The requirements for patentability of software has been in flux for 20 years. Hopefully we will soon have some clarity.
01 June 2009
31 October 2008
In re Bernard L. Bilski and Rand A. Warsaw, 2008
In October 2008, the Federal Circuit reviewed the decision of the Board of Patent Appeals and Interferences that discussed below in a 132 page decision. The Board had sustained a rejection of all eleven claims under 35 U.S.C. 101 as not directed to patent-eligible subject matter. The Federal Circuit affirmed, holding that Bilski's claims were not statutory under 35 U.S.C. 101.
In this case, the Federal Circuit revived the Benson test, that claimed process is surely patent-eligible under Section 101 if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. The Federal Circuit also stated that the State Street test is no longer valid. The Federal Circuit was reacting to Supreme Court criticism during oral arguments in Laboratory Corp. of America Holdings v. Metabolite Laboratories against the State Street test. This case will make it much harder to procure business method patents. Many business method patents may now be invalid. Only business method patents that survive the machine or transformation test, discussed below, are statutory after Bilski. My definition of a "business method patent" is one where there is no software or hardware involved. Others may have different definitions. For a business method to survive this test will be difficult.
With the Bilski case, the Federal Circuit has changed, and is leaving open the possibility of substantially further changing, the tests for statutory subject matter in the field of software patents and possibly with respect to method claims in all technology areas.
Bilski's patent application is Serial No. 08/833,892 and relates to commodity trading. Claim 1 is representative and recites:
1. A method for managing the consumption risk costs of a commodity sold by a commodity provider at a fixed price comprising the steps of:
(a) initiating a series of transactions between said commodity provider and consumers of said commodity wherein said consumers purchase said commodity at a fixed rate based upon historical averages, said fixed rate corresponding to a risk position of said consumer;
(b) identifying market participants for said commodity having a counter-risk position to said consumers; and
(c) initiating a series of transactions between said commodity provider and said market participants at a second fixed rate such that said series of market participant transactions balances the risk position of said series of consumer transactions.
The claim is for a method of hedging risk in commodities trading.
During examination, the Examiner rejected claims 1-11 under 35 U.S.C. 101 stating that the invention is not implemented on a specific apparatus and merely manipulates an abstract idea and solves a purely mathematical problem without any limitation to a practical application. The Examiner decided, therefore, that the invention is not directed to the technological arts.
On appeal, the Board held that the examiner erred to the extent that he relied on a technological arts test because the case law does not support such a test. The Board held that the requirement of a specific apparatus was also erroneous because a claim that does not recite a specific apparatus may still be directed to patent-eligible subject matter "if there is a transformation of physical subject matter from one state to another." The Board stated that mixing two elements or compounds to produce a chemical substance or mixture is clearly a statutory transformation although no apparatus is claimed to perform the step and although the step could be performed manually. However, the Board concluded that Applicants' claims did not involve any patent-eligible transformation and held that transformation of non-physical financial risks and legal liabilities of the commodity provider, the consumer, and the market participants is not patent-eligible subject matter. The Board also held that Applicants' claims preempted any and every possible way of performing the steps of the claimed process, by human or by any kind of machine or by any combination thereof, and they only claimed an abstract idea ineligible for patent protection.
The Federal Circuit started by quoting section 101:
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.
The statute thus recites four categories of patent-eligible subject matter: processes, machines, manufactures, and compositions of matter. It is undisputed that Applicants' claims are not directed to a machine, manufacture, or composition of matter. Thus, the Federal Circuit stated that the issue before them involves what the term "process" means, and how to determine whether a given claim is a new and useful process.
The Federal Circuit noted that the Supreme Court has held that the meaning of "process" as used in Section 101 is narrower than its ordinary meaning. The Supreme Court has held that a claim is not a patent-eligible process if it claims laws of nature, natural phenomena, or abstract ideas in Diamond v. Dier, 450 U.S. 175, 185 (1981).
The Federal Circuit then looked at the Supreme Court's Benson decision (see my separate post on Benson)where the Supreme Court held that because an algorithm had no uses other than those that would be covered by the claims (any conversion of BCD to pure binary on a digital computer), the claims pre-empted all uses of the algorithm and thus were effectively drawn to the algorithm itself. This Benson case was a very old case decided at a time when most people believed that software was not patentable. I wonder if the Federal Circuit is trying to go back in time.
The Federal Circuit then stated that the question before us is whether Applicants' claim recites a fundamental principle and, if so, whether if would pre-empt substantially all uses of that fundamental principle if allowed. The Federal Circuit noted that this inquiry is hardly straightforward. Analogizing to the facts of Diehr or Benson is of limited usefulness because the more challenging process claims of the twenty-first century are seldom so clearly limited in scope as the highly specific, plainly corporeal industrial manufacturing process of Diehr; nor are they typically as broadly claimed or purely abstract and mathematical as the algorithm of Benson.
Continuing its focus on Benson, the Federal Circuit stated that the Supreme Court in that case enunciated a definitive test to determine whether a process claim is tailored narrowly enough to encompass only a particular application rather than to pre-empt the principle itself. A claimed process is surely patent-eligible under Section 101 if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing.
The Federal Circuit stated that, Benson presents a difficult case under its own test in that the claimed process operated on a machine, a digital computer, but was still held to be ineligible subject matter. However, in Benson, the limitations tying the process to a computer were not actually limiting because the fundamental principle at issue, a particular algorithm, had no utility other than operating on a digital computer. Thus, the claim's tie to a digital computer did not reduce the pre-emptive footprint of the claim since all uses of the algorithm were still covered by the claim.
The Federal Circuit noted that the Supreme Court explicitly stated in Benson that transformation and reduction of an article to a different state or thing is the clue to the patentability of a process claim that does not include particular machines.
The Federal Circuit recognized that the Benson court was equivocal in first putting forward this test and stated that "We do not hold that no process patent could ever qualify if it did not meet the requirements of our prior precedents." The Federal Circuit then noted that this point was noted in Flook but that this caveat was not repeated in Diehr when the Diehr court reaffirmed the machine-or-transformation test. The Federal Circuit then stated that they believe their reliance on the Supreme Court's machine-or-transformation test is sound. The Federal Circuit then stated that they recognize that the Supreme Court may ultimately decide to alter or perhaps even set aside this test to accommodate emerging technologies. And the Federal Circuit did not rule out the possibility that they may in the future refine or augment the test or how it is applied.
The Federal Circuit then noted that the Diehr court held that field-of-use limitations are generally insufficient to render an otherwise ineligible process claim patent-eligible, and that the Diehr court stated that insignificant postsolution activity will not transform an unpatentable principle into a patentable process.
The Federal Circuit then noted that the Supreme Court held (in Diehr) that whether a claimed process is novel or non-obvious is irrelevant to the Section 101 analysis, and that it is inappropriate to dissect claims into old and new elements and then to ignore the presence of the old elements in the analysis.
The Federal Circuit then stated that the Freeman-Walter-Abele test is inadequate.
The Federal Circuit then reviewed the much more recent test of "useful, concrete, and tangible result" associated with State Street and stated that this inquiry is insufficient to determine whether a claim is patent eligible under Section 101.
The Federal Circuit then rejected the "technological arts test" because the meanings of the terms technological arts and technology are both ambiguous and ever-changing.
The Federal Circuit then addressed a possible misunderstanding of the decision in Comiskey, noting that some may suggest that Comiskey implicitly applied a new Section 101 test that bars any claim reciting a mental process that lacks significant physical steps. The Federal Circuit stated that they did not so hold and did not announce any new test at all in Comiskey. Rather, they recognized that the Supreme Court held that mental processes, like fundamental principles, are excluded by 101.
The Federal Circuit then stated that the machine-or-transformation test is a two-branched inquiry and certain considerations are applicable to analysis under either branch. First, as illustrated by Benson, the use of a specific machine or transformation of an article must impose meaningful limits on the claim's scope to impart patent-eligibility. Second, the involvement of the machine or transformation in the claimed process much not merely be insignificant extra-solution activity.
In this case, Applicants themselves admit that the language of claim 1 does not limit any process step to any specific machine or apparatus. The Federal Circuit stated that issues specific to the machine implementation part of the test were not before them, and they left to future cases the elaboration of the precise contours of machine implementation as well as answers to particular questions such as whether or when recitation of a computer suffices to tie a process claim to a particular machine.
The Federal Circuit then held that Applicants' process as claimed does not transform any article to a different state or thing. The claims were therefore non-statutory.
Keep in mind that Bilski and Benson only considered method claims. An open question is how much of a machine is required? A general purpose computer may not be sufficient. The Federal Circuit indicates that the machine must be intimately tied to the claimed steps. The USPTO Board of Appeals has recently held that Beauregard claims are statutory but that doesn't mean that the Federal Circuit will agree as a general proposition. From the tone of Bilski, I doubt that they will agree as a general proposition that all Beauregard claims are statutory. Examiners at the U.S. Patent and Trademark Office, after State Street, took the position that Beauregard claims were only statutory if they also met the State Street test. Now they will probably use Bilski as the primary test. Also, the U.S. Patent and Trademark Office and the Federal Circuit tend to apply method tests to apparatus claims with respect to 35 U.S.C. 101 when it comes to software. We will have to see how the Federal Circuit treats apparatus claims after Bilski. Also keep in mind that Diamond v. Diehr (which held that which held that the execution of a method, controlled by running a computer program, was statutory--see the summary of this case below) is good Supreme Court law and is more recent than Benson. There are many open questions.
In this case, the Federal Circuit revived the Benson test, that claimed process is surely patent-eligible under Section 101 if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. The Federal Circuit also stated that the State Street test is no longer valid. The Federal Circuit was reacting to Supreme Court criticism during oral arguments in Laboratory Corp. of America Holdings v. Metabolite Laboratories against the State Street test. This case will make it much harder to procure business method patents. Many business method patents may now be invalid. Only business method patents that survive the machine or transformation test, discussed below, are statutory after Bilski. My definition of a "business method patent" is one where there is no software or hardware involved. Others may have different definitions. For a business method to survive this test will be difficult.
With the Bilski case, the Federal Circuit has changed, and is leaving open the possibility of substantially further changing, the tests for statutory subject matter in the field of software patents and possibly with respect to method claims in all technology areas.
Bilski's patent application is Serial No. 08/833,892 and relates to commodity trading. Claim 1 is representative and recites:
1. A method for managing the consumption risk costs of a commodity sold by a commodity provider at a fixed price comprising the steps of:
(a) initiating a series of transactions between said commodity provider and consumers of said commodity wherein said consumers purchase said commodity at a fixed rate based upon historical averages, said fixed rate corresponding to a risk position of said consumer;
(b) identifying market participants for said commodity having a counter-risk position to said consumers; and
(c) initiating a series of transactions between said commodity provider and said market participants at a second fixed rate such that said series of market participant transactions balances the risk position of said series of consumer transactions.
The claim is for a method of hedging risk in commodities trading.
During examination, the Examiner rejected claims 1-11 under 35 U.S.C. 101 stating that the invention is not implemented on a specific apparatus and merely manipulates an abstract idea and solves a purely mathematical problem without any limitation to a practical application. The Examiner decided, therefore, that the invention is not directed to the technological arts.
On appeal, the Board held that the examiner erred to the extent that he relied on a technological arts test because the case law does not support such a test. The Board held that the requirement of a specific apparatus was also erroneous because a claim that does not recite a specific apparatus may still be directed to patent-eligible subject matter "if there is a transformation of physical subject matter from one state to another." The Board stated that mixing two elements or compounds to produce a chemical substance or mixture is clearly a statutory transformation although no apparatus is claimed to perform the step and although the step could be performed manually. However, the Board concluded that Applicants' claims did not involve any patent-eligible transformation and held that transformation of non-physical financial risks and legal liabilities of the commodity provider, the consumer, and the market participants is not patent-eligible subject matter. The Board also held that Applicants' claims preempted any and every possible way of performing the steps of the claimed process, by human or by any kind of machine or by any combination thereof, and they only claimed an abstract idea ineligible for patent protection.
The Federal Circuit started by quoting section 101:
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.
The statute thus recites four categories of patent-eligible subject matter: processes, machines, manufactures, and compositions of matter. It is undisputed that Applicants' claims are not directed to a machine, manufacture, or composition of matter. Thus, the Federal Circuit stated that the issue before them involves what the term "process" means, and how to determine whether a given claim is a new and useful process.
The Federal Circuit noted that the Supreme Court has held that the meaning of "process" as used in Section 101 is narrower than its ordinary meaning. The Supreme Court has held that a claim is not a patent-eligible process if it claims laws of nature, natural phenomena, or abstract ideas in Diamond v. Dier, 450 U.S. 175, 185 (1981).
The Federal Circuit then looked at the Supreme Court's Benson decision (see my separate post on Benson)where the Supreme Court held that because an algorithm had no uses other than those that would be covered by the claims (any conversion of BCD to pure binary on a digital computer), the claims pre-empted all uses of the algorithm and thus were effectively drawn to the algorithm itself. This Benson case was a very old case decided at a time when most people believed that software was not patentable. I wonder if the Federal Circuit is trying to go back in time.
The Federal Circuit then stated that the question before us is whether Applicants' claim recites a fundamental principle and, if so, whether if would pre-empt substantially all uses of that fundamental principle if allowed. The Federal Circuit noted that this inquiry is hardly straightforward. Analogizing to the facts of Diehr or Benson is of limited usefulness because the more challenging process claims of the twenty-first century are seldom so clearly limited in scope as the highly specific, plainly corporeal industrial manufacturing process of Diehr; nor are they typically as broadly claimed or purely abstract and mathematical as the algorithm of Benson.
Continuing its focus on Benson, the Federal Circuit stated that the Supreme Court in that case enunciated a definitive test to determine whether a process claim is tailored narrowly enough to encompass only a particular application rather than to pre-empt the principle itself. A claimed process is surely patent-eligible under Section 101 if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing.
The Federal Circuit stated that, Benson presents a difficult case under its own test in that the claimed process operated on a machine, a digital computer, but was still held to be ineligible subject matter. However, in Benson, the limitations tying the process to a computer were not actually limiting because the fundamental principle at issue, a particular algorithm, had no utility other than operating on a digital computer. Thus, the claim's tie to a digital computer did not reduce the pre-emptive footprint of the claim since all uses of the algorithm were still covered by the claim.
The Federal Circuit noted that the Supreme Court explicitly stated in Benson that transformation and reduction of an article to a different state or thing is the clue to the patentability of a process claim that does not include particular machines.
The Federal Circuit recognized that the Benson court was equivocal in first putting forward this test and stated that "We do not hold that no process patent could ever qualify if it did not meet the requirements of our prior precedents." The Federal Circuit then noted that this point was noted in Flook but that this caveat was not repeated in Diehr when the Diehr court reaffirmed the machine-or-transformation test. The Federal Circuit then stated that they believe their reliance on the Supreme Court's machine-or-transformation test is sound. The Federal Circuit then stated that they recognize that the Supreme Court may ultimately decide to alter or perhaps even set aside this test to accommodate emerging technologies. And the Federal Circuit did not rule out the possibility that they may in the future refine or augment the test or how it is applied.
The Federal Circuit then noted that the Diehr court held that field-of-use limitations are generally insufficient to render an otherwise ineligible process claim patent-eligible, and that the Diehr court stated that insignificant postsolution activity will not transform an unpatentable principle into a patentable process.
The Federal Circuit then noted that the Supreme Court held (in Diehr) that whether a claimed process is novel or non-obvious is irrelevant to the Section 101 analysis, and that it is inappropriate to dissect claims into old and new elements and then to ignore the presence of the old elements in the analysis.
The Federal Circuit then stated that the Freeman-Walter-Abele test is inadequate.
The Federal Circuit then reviewed the much more recent test of "useful, concrete, and tangible result" associated with State Street and stated that this inquiry is insufficient to determine whether a claim is patent eligible under Section 101.
The Federal Circuit then rejected the "technological arts test" because the meanings of the terms technological arts and technology are both ambiguous and ever-changing.
The Federal Circuit then addressed a possible misunderstanding of the decision in Comiskey, noting that some may suggest that Comiskey implicitly applied a new Section 101 test that bars any claim reciting a mental process that lacks significant physical steps. The Federal Circuit stated that they did not so hold and did not announce any new test at all in Comiskey. Rather, they recognized that the Supreme Court held that mental processes, like fundamental principles, are excluded by 101.
The Federal Circuit then stated that the machine-or-transformation test is a two-branched inquiry and certain considerations are applicable to analysis under either branch. First, as illustrated by Benson, the use of a specific machine or transformation of an article must impose meaningful limits on the claim's scope to impart patent-eligibility. Second, the involvement of the machine or transformation in the claimed process much not merely be insignificant extra-solution activity.
In this case, Applicants themselves admit that the language of claim 1 does not limit any process step to any specific machine or apparatus. The Federal Circuit stated that issues specific to the machine implementation part of the test were not before them, and they left to future cases the elaboration of the precise contours of machine implementation as well as answers to particular questions such as whether or when recitation of a computer suffices to tie a process claim to a particular machine.
The Federal Circuit then held that Applicants' process as claimed does not transform any article to a different state or thing. The claims were therefore non-statutory.
Keep in mind that Bilski and Benson only considered method claims. An open question is how much of a machine is required? A general purpose computer may not be sufficient. The Federal Circuit indicates that the machine must be intimately tied to the claimed steps. The USPTO Board of Appeals has recently held that Beauregard claims are statutory but that doesn't mean that the Federal Circuit will agree as a general proposition. From the tone of Bilski, I doubt that they will agree as a general proposition that all Beauregard claims are statutory. Examiners at the U.S. Patent and Trademark Office, after State Street, took the position that Beauregard claims were only statutory if they also met the State Street test. Now they will probably use Bilski as the primary test. Also, the U.S. Patent and Trademark Office and the Federal Circuit tend to apply method tests to apparatus claims with respect to 35 U.S.C. 101 when it comes to software. We will have to see how the Federal Circuit treats apparatus claims after Bilski. Also keep in mind that Diamond v. Diehr (which held that which held that the execution of a method, controlled by running a computer program, was statutory--see the summary of this case below) is good Supreme Court law and is more recent than Benson. There are many open questions.
24 September 2007
In re Stephen W. Comiskey, 2007
In this case, the Federal Circuit held that methods that employ only human intelligence without involving machines, manufactures, or compositions of matter do not qualify as statutory suject matter under 35 U.S.C. Section 101 because they are directed to abstract ideas.
According to the Comiskey court, mental processes (or processes of human thinking) standing alone are not patentable even if they have a practical application.
The Court concluded that:
It is thus clear that the present statute does not allow patents to be issued on particular business systems—such as a particular type of arbitration—that depend entirely on the use of mental processes. In other words, the patent statute does not allow patents on particular systems that depend for their operation on human intelligence alone, a field of endeavor that both the framers and Congress intended to be beyond the reach of patentable subject matter. Thus, it is established that the application of human intelligence to the solution of practical problems is not in and of itself patentable.
The case can be found here: http://www.fedcir.gov/opinions/06-1286.pdf
According to the Comiskey court, mental processes (or processes of human thinking) standing alone are not patentable even if they have a practical application.
The Court concluded that:
It is thus clear that the present statute does not allow patents to be issued on particular business systems—such as a particular type of arbitration—that depend entirely on the use of mental processes. In other words, the patent statute does not allow patents on particular systems that depend for their operation on human intelligence alone, a field of endeavor that both the framers and Congress intended to be beyond the reach of patentable subject matter. Thus, it is established that the application of human intelligence to the solution of practical problems is not in and of itself patentable.
The case can be found here: http://www.fedcir.gov/opinions/06-1286.pdf
In re Petrus A.C.M. Nuijten, 2007
This case has been decided by the Court of Appeals for the Federal Circuit.
The decision marks the death of signal claims.The issue on appeal was whether the Board of Appeals erred when it affirmed the Patent Examiner's final rejection of Claims 14 and 22-24 of Mr. Nuijten's patent application under 35 U.S.C. 101 as being directed to non-statutory subject matter. More specifically, the Court was to decide whether the invention of a signal, which is otherwise patentable when stored in a physical storage medium, is in and of itself patentable subject matter. The case relates to U.S. Patent Application Serial No. 09/211,928 for an invention "Embedding Supplemental Data in an Encoded Signal" which relates to signal watermarking. The apparatus claims were found to be statutory and allowable over the prior art.
Independent Claim 14, which is the subject of the appeal, recites:
14. A signal with embedded supplemental data, the signal being encoded in accordance with a given encoding process and selected samples of the signal representing the supplemental data, and at least one of the samples preceding the selected samples is different from the sample corresponding to the given encoding process.
The court could not fit a ‘signal’ into any of the four categories (process, machine, manufacture, or composition of matter).
Because a signal does not fit within a predefined category, the Federal Circuit concluded that a signal is not statutory subject matter.
The decision can be found here: http://www.fedcir.gov/opinions/06-1371.pdf
p.s., The applicant filed a petition for certiorari in June 2008 to overturn the Federal Circuit’s decision.
The decision marks the death of signal claims.The issue on appeal was whether the Board of Appeals erred when it affirmed the Patent Examiner's final rejection of Claims 14 and 22-24 of Mr. Nuijten's patent application under 35 U.S.C. 101 as being directed to non-statutory subject matter. More specifically, the Court was to decide whether the invention of a signal, which is otherwise patentable when stored in a physical storage medium, is in and of itself patentable subject matter. The case relates to U.S. Patent Application Serial No. 09/211,928 for an invention "Embedding Supplemental Data in an Encoded Signal" which relates to signal watermarking. The apparatus claims were found to be statutory and allowable over the prior art.
Independent Claim 14, which is the subject of the appeal, recites:
14. A signal with embedded supplemental data, the signal being encoded in accordance with a given encoding process and selected samples of the signal representing the supplemental data, and at least one of the samples preceding the selected samples is different from the sample corresponding to the given encoding process.
The court could not fit a ‘signal’ into any of the four categories (process, machine, manufacture, or composition of matter).
Because a signal does not fit within a predefined category, the Federal Circuit concluded that a signal is not statutory subject matter.
The decision can be found here: http://www.fedcir.gov/opinions/06-1371.pdf
p.s., The applicant filed a petition for certiorari in June 2008 to overturn the Federal Circuit’s decision.
24 February 2007
Lucent Technologies, Inc. v. Gateway Inc. and Microsoft Corp., S.D. Calif., 2007
This is not a Federal Circuit decision, but a lower court decision. In an appeal, the Federal Circuit could completely reverse the lower court.
This case involved two Lucent patents, Nos. 5,341,457 and Re. 39,080, relating to reducing the size of computer audio files.
In this case, a jury awarded a 1.5 billion dollar verdict against Microsoft.
Expect to see Microsoft make further efforts to reform the patent system. Microsoft has been actively trying to modify the patent system even though they are one of the U.S. Patent and Trademark Office's largest customers. For example, in 2004 alone, they filed more than 3,000 patent applications.
If you would like to see some of Microsoft's patents, go here: http://patft.uspto.gov/netahtml/PTO/search-bool.html
and put Microsoft in Field 1, and pull down Assignee Name for Field 1.
Recently, Microsoft and many others commented on proposed rule changes to make it more difficult to file continuations. Please click here, and compare the views of various bar associations with that of Microsoft:
http://www.uspto.gov/web/offices/pac/dapp/opla/comments/fpp_continuation/continuation_comments.html
Contrary to Microsoft's position that the ability to file Continuation applications should be restricted, many patent attorneys feel that continuations are often necessary because Examiners do not have sufficient time to properly examine applications, and routinely issue "Final" rejections before fully understanding the invention. A continuation becomes necessary just to keep the discussion going long enough to make sure the Examiner understands the invention described in a patent application and understands the prior art.
This verdict will likely make Microsoft want to continue to press for patent reforms that weaken the patent system. Microsoft and others are part of a lobbying group called the "Coalition for Patent Fairness":
http://www.investors.com/editorial/IBDArticles.asp?artsec=17&artnum=2&issue=20070227
This case involved two Lucent patents, Nos. 5,341,457 and Re. 39,080, relating to reducing the size of computer audio files.
In this case, a jury awarded a 1.5 billion dollar verdict against Microsoft.
Expect to see Microsoft make further efforts to reform the patent system. Microsoft has been actively trying to modify the patent system even though they are one of the U.S. Patent and Trademark Office's largest customers. For example, in 2004 alone, they filed more than 3,000 patent applications.
If you would like to see some of Microsoft's patents, go here: http://patft.uspto.gov/netahtml/PTO/search-bool.html
and put Microsoft in Field 1, and pull down Assignee Name for Field 1.
Recently, Microsoft and many others commented on proposed rule changes to make it more difficult to file continuations. Please click here, and compare the views of various bar associations with that of Microsoft:
http://www.uspto.gov/web/offices/pac/dapp/opla/comments/fpp_continuation/continuation_comments.html
Contrary to Microsoft's position that the ability to file Continuation applications should be restricted, many patent attorneys feel that continuations are often necessary because Examiners do not have sufficient time to properly examine applications, and routinely issue "Final" rejections before fully understanding the invention. A continuation becomes necessary just to keep the discussion going long enough to make sure the Examiner understands the invention described in a patent application and understands the prior art.
This verdict will likely make Microsoft want to continue to press for patent reforms that weaken the patent system. Microsoft and others are part of a lobbying group called the "Coalition for Patent Fairness":
http://www.investors.com/editorial/IBDArticles.asp?artsec=17&artnum=2&issue=20070227
22 February 2007
Ex parte Bilski
Despite the fairly clear message of previous Federal Circuit cases including, in particular, AT+T Corp. v. Excel, the U.S. Patent and Trademark Office has been particularly hostile against anything that looks like a business method patent application. They even have a two tier review. If an examiner is inclined to allow a business patent application, another examiner reviews the decision. There is a disincentive for the first examiner to allow an application, due to the fear of being criticized. Allowance rates are at near record lows. Applicants having business method patent applications, and even some applicants having software patent applications, are facing long, drawn out, expensive prosecutions. The USPTO is likely reacting to bad publicity generated by the allowance of the Amazon One-Click patent, as well as to PR campaigns and lobbying efforts.
Bilski's patent application is Serial No. 08/833,892 and relates to commodity trading. Claim 1 is representative and recites:
1. A method for managing the consumption risk costs of a commodity sold by a commodity provider at a fixed price comprising the steps of:
(a) initiating a series of transactions between said commodity provider and consumers of said commodity wherein said consumers purchase said commodity at a fixed rate based upon historical averages, said fixed rate corresponding to a risk position of said consumer;
(b) identifying market participants for said commodity having a counter-risk position to said consumers; and
(c) initiating a series of transactions between said commodity provider and said market participants at a second fixed rate such that said series of market participant transactions balances the risk position of said series of consumer transactions.
No hardware is required to perform the steps. This is thus what would be called a "pure" business method patent application.
During prosecution, the Examiner used a rejection similar to that used unsuccessfully in the Lundgren case, and stated that "the invention is not directed to the technological arts."
To reduce the risk of ending up with the same result as in the Lundgren case, the Board of Appeal took the position that Bilski was claiming an "abstract idea":
"The Board held in Lundgren that the 'technological arts' test is not a separate and distinct test for statutory subject matter. Although commentators have read this as eliminating a 'technology' requirement for patents, this is not what was stated or intended."
The Bilski Board also stated that:
AT+T involved a machine-implement process. Machines are physical things that nominally fall within the class of a "machine" in section 101, and the machine-implemented methods inherently act on and transform physical subject matter, such as objects or electrical signals, and nominally fall within the definition of a process under section 101. No machine is required by the present claims. Until instructed otherwise, we interpret State Street and AT+T to address the 'special case' of subject matter that nominally falls within section 101, a general purpose machine or machine-implemented process, but which is nonetheless unpatentable because the machine performs an 'abstract idea.'
This is another case to watch.
Bilski's patent application is Serial No. 08/833,892 and relates to commodity trading. Claim 1 is representative and recites:
1. A method for managing the consumption risk costs of a commodity sold by a commodity provider at a fixed price comprising the steps of:
(a) initiating a series of transactions between said commodity provider and consumers of said commodity wherein said consumers purchase said commodity at a fixed rate based upon historical averages, said fixed rate corresponding to a risk position of said consumer;
(b) identifying market participants for said commodity having a counter-risk position to said consumers; and
(c) initiating a series of transactions between said commodity provider and said market participants at a second fixed rate such that said series of market participant transactions balances the risk position of said series of consumer transactions.
No hardware is required to perform the steps. This is thus what would be called a "pure" business method patent application.
During prosecution, the Examiner used a rejection similar to that used unsuccessfully in the Lundgren case, and stated that "the invention is not directed to the technological arts."
To reduce the risk of ending up with the same result as in the Lundgren case, the Board of Appeal took the position that Bilski was claiming an "abstract idea":
"The Board held in Lundgren that the 'technological arts' test is not a separate and distinct test for statutory subject matter. Although commentators have read this as eliminating a 'technology' requirement for patents, this is not what was stated or intended."
The Bilski Board also stated that:
AT+T involved a machine-implement process. Machines are physical things that nominally fall within the class of a "machine" in section 101, and the machine-implemented methods inherently act on and transform physical subject matter, such as objects or electrical signals, and nominally fall within the definition of a process under section 101. No machine is required by the present claims. Until instructed otherwise, we interpret State Street and AT+T to address the 'special case' of subject matter that nominally falls within section 101, a general purpose machine or machine-implemented process, but which is nonetheless unpatentable because the machine performs an 'abstract idea.'
This is another case to watch.
21 February 2007
Ex parte Rice
After the Beauregard case, many commentators took the position that signal claims should also be statutory. Software developers have an interest in being able to protect against infringers who transfer software over the Internet. Such software would not be embodied in a computer readable medium (Beauregard). The U.S. Patent and Trademark Office was allowing patent applications including claims directed to a "carrier wave" embodying computer program code to perform various functions.
Ex parte Rice is a Board of Appeals decision for a patent application directed to a "spread Spectrum Transceiver." The invention was directed to an electromagnetic signal" and an "electromagnetic signal" produced by a certain process. One representative claim was:
2. An assembly of simultaneously transmitted electromagnetic signals, said signals being related to each other in said assembly so as to communicate information to a receiver, said signals being structured so as to contain corresponding subsets of a set of binary spreading-code sequences, at least one subset of said set of binary spreading-code sequences containing more than one of said binary spreading-code sequences, each subset of said set of binary spreading-code sequences embodying a corresponding portion of said information.
After losing one appeal, independent claims were changed from reciting "signals" to "electromagnetic signals."
The claims were rejected under 35 U.S.C. section 101 as being directed to nonstatutory subject matter. The examiner concluded that the claimed "electromagnetic signals" were nonstatutory subject matter because such signals were "transitory and ephemeral."
The examiner stated that signals are neither a manufacture nor a composition of matter. The examiner made the same arguments in a previous appeal.
Appellant referred to a paper by Stephen G. Kunin, Deputy Assistant Commission for Patent Policy & Projects, titled Computer Program Product Claim, presented at a "Partners in Patents V Conference" sometime between October 22, 1996, and May 18, 2000, which indicated that the transitory nature of a signal did not make it nonstatutory subject matter, referring by example to U.S. Patent 3,156,523 to element 95 and citing In re Breslow, 616 F.2d 516 (CCPA 1980)(reversing the Board's conclusion that compounds were not patentable subject matter because they were "transitory and ephemeral in nature".
The Board of Appeals agreed that signals did not become unpatentable subject matter just because of their "transitory and ephemeral nature." The Board said that there is no reason why the time of existence should affect a subject matter's status under the four statutory categories of "process, machine, manufacture, or composition of matter," or the three exceptions for "laws of nature, natural phenomena, and abstract ideas."
The Board also noted that Mr. Kunin's reasoning was incorporated into the Manual of Patent Examining Procedure section 2106 (8th ed. Aug. 2001), page 2100-14: "[A] signal claim directed to a practical application of electromagnetic energy is statutory regardless of its transitory nature. See O'Reilly, 56 U.S. at 114-19; In re Breslow, 616 F.2d 516, 519-21, 205 USPQ 211, 225-26 (CCPA 1980)."
Unfortunately, this decision was not written for publication and was not binding precedent. The U.S. Patent and Trademark Office apparently no longer agrees with this position. Though this is not a Federal Circuit case, it is being included here to show the change of attitude and to contrast with the Nuijten case.
Ex parte Rice is a Board of Appeals decision for a patent application directed to a "spread Spectrum Transceiver." The invention was directed to an electromagnetic signal" and an "electromagnetic signal" produced by a certain process. One representative claim was:
2. An assembly of simultaneously transmitted electromagnetic signals, said signals being related to each other in said assembly so as to communicate information to a receiver, said signals being structured so as to contain corresponding subsets of a set of binary spreading-code sequences, at least one subset of said set of binary spreading-code sequences containing more than one of said binary spreading-code sequences, each subset of said set of binary spreading-code sequences embodying a corresponding portion of said information.
After losing one appeal, independent claims were changed from reciting "signals" to "electromagnetic signals."
The claims were rejected under 35 U.S.C. section 101 as being directed to nonstatutory subject matter. The examiner concluded that the claimed "electromagnetic signals" were nonstatutory subject matter because such signals were "transitory and ephemeral."
The examiner stated that signals are neither a manufacture nor a composition of matter. The examiner made the same arguments in a previous appeal.
Appellant referred to a paper by Stephen G. Kunin, Deputy Assistant Commission for Patent Policy & Projects, titled Computer Program Product Claim, presented at a "Partners in Patents V Conference" sometime between October 22, 1996, and May 18, 2000, which indicated that the transitory nature of a signal did not make it nonstatutory subject matter, referring by example to U.S. Patent 3,156,523 to element 95 and citing In re Breslow, 616 F.2d 516 (CCPA 1980)(reversing the Board's conclusion that compounds were not patentable subject matter because they were "transitory and ephemeral in nature".
The Board of Appeals agreed that signals did not become unpatentable subject matter just because of their "transitory and ephemeral nature." The Board said that there is no reason why the time of existence should affect a subject matter's status under the four statutory categories of "process, machine, manufacture, or composition of matter," or the three exceptions for "laws of nature, natural phenomena, and abstract ideas."
The Board also noted that Mr. Kunin's reasoning was incorporated into the Manual of Patent Examining Procedure section 2106 (8th ed. Aug. 2001), page 2100-14: "[A] signal claim directed to a practical application of electromagnetic energy is statutory regardless of its transitory nature. See O'Reilly, 56 U.S. at 114-19; In re Breslow, 616 F.2d 516, 519-21, 205 USPQ 211, 225-26 (CCPA 1980)."
Unfortunately, this decision was not written for publication and was not binding precedent. The U.S. Patent and Trademark Office apparently no longer agrees with this position. Though this is not a Federal Circuit case, it is being included here to show the change of attitude and to contrast with the Nuijten case.
2005 Interim Guidelines for Examination of Patent Applications...,
Interim Guidelines for Examination of Patent Applications for Patent Subject Matter Eligibility were published in late 2005. Although software related patent applications were now generally accepted as being capable of patent protection, Examiners still had trouble with business method patent applications. These guidelines were issued to help examiners determine whether or not a business method patent application was statutory. I personally find it simpler to read the AT&T v Excel case and consider whether there is some practical application that produces a useful, tangible, and concrete result, such as a transfer of money from one person to another.
Because this is an important historical document, I have placed a copy on my web server, and it is available here:
http://www.patentsusa.com/2005_Interim_Guidelines.pdf
The Guidelines, in my view, resulted in Examiners again routinely raising rejections of software related applications under 35 U.S.C. 101, after years of acceptance of the statutory nature of software related inventions. The Examiners are raising these issues again even though the Guidelines state that software related applications can be statutory, and were primarily drafted to discuss business method inventions. What I feel to be some of the most relevant portions are reproduced here:
In the mid-1990's, the USPTO sought to clarify the legal requirements for statutory subject matter with regard to computer-related inventions. See Examination Guidelines for Computer Related Inventions, 61 Fed. Reg. 7478 (1996). Subsequent to the publication of those guidelines, the Court of Appeals for the Federal Circuit issued opinions in State Street Bank & Trust Co. v. Signature Financial Group Inc., and AT&T Corp. v. Excel Communications, Inc. These decisions explained that, to be eligible for patent protection, the claimed invention as a whole must accomplish a practical application. That is, it must produce a "useful, concrete and tangible result." Since this time, the USPTO has seen increasing numbers of applications outside the realm of computer-related inventions that raise subject matter eligibility issues. In order to assist examiners in identifying and resolving these issues, the USPTO is issuing these interim examination guidelines to assist USPTO personnel in the examination of patent applications to determine whether the subject matter as claimed is eligible for patent protection. The principal objective of these guidelines is to assist examiners in determining, on a case-by-case basis, whether a claimed invention falls within a judicial exception to statutory subject matter (i.e., is nothing more than an abstract idea, law of nature, or natural phenomenon), or whether it is a practical application of a judicial exception to statutory subject matter.
The guidelines explain that a practical application of a 35 U.S.C. § 101 judicial exception is claimed if the claimed invention physically transforms an article or physical object to a different state or thing, or if the claimed invention otherwise produces a useful, concrete, and tangible result.
The claimed invention as a whole must be useful and accomplish a practical application. That is, it must produce a "useful, concrete and tangible result." The applicant is in the best position to explain why an invention is believed useful. Accordingly, a complete disclosure should contain some indication of the practical application for the claimed invention, i.e., why the applicant believes the claimed invention is useful. Such a statement will usually explain the purpose of the invention or how the invention may be used (e.g., a compound is believed to be useful
in the treatment of a particular disorder). Regardless of the form of statement of utility, it must enable one ordinarily skilled in the art to understand why the applicant believes the claimed invention is useful. See MPEP § 2107 for utility examination guidelines. An applicant may assert more than one utility and practical application, but only one is necessary.
DETERMINE WHETHER THE CLAIMED INVENTION COMPLIES WITH THE SUBJECT MATTER ELIGIBILITY REQUIREMENT OF 35 U.S.C. § 101
Determine Whether the Claimed Invention Falls Within An Enumerated Statutory Category
To properly determine whether a claimed invention complies with the statutory invention requirements of 35 U.S.C. § 101, USPTO personnel must first identify whether the claim falls within at least one of the four enumerated categories of patentable subject matter recited in section 101 (process, machine, manufacture or composition of matter). In many instances it is clear within which of the enumerated categories a claimed invention falls. Even if the characterization of the claimed invention is not clear, this is usually not an issue that will preclude making an accurate and correct assessment with respect to the section 101 analysis. The scope of 35 U.S.C. § 101 is the same regardless of the form or category of invention in which a particular claim is drafted. Note that an apparatus claim with process steps is not classified as a "hybrid" claim; instead, it is simply an apparatus claim including functional limitations.
The burden is on the USPTO to set forth a prima facie case of unpatentability. Therefore if the examiner determines that it is more likely than not that the claimed subject matter falls outside all of the statutory categories, the examiner must provide an explanation. The examiner must further continue with the statutory subject matter analysis as set forth below. Also, the examiner must still examine the claims for compliance with 35 U.S.C. §§ 102, 103, and 112.
If the invention as set forth in the written description is statutory, but the claims define subject matter that is not, the deficiency can be corrected by an appropriate amendment of the claims. In such a case, USPTO personnel should reject the claims drawn to nonstatutory subject matter under 35 U.S.C. § 101, but identify the features of the invention that would render the claimed subject matter statutory if recited in the claim.
Determine Whether the Claimed Invention Falls Within § 101 Judicial Exceptions - Laws of Nature, Natural Phenomena and Abstract Ideas
Determining whether the claim falls within one of the four enumerated categories of patentable subject matter recited in 35 U.S.C. § 101 (process, machine, manufacture or composition of matter) does not end the analysis because claims directed to nothing more than abstract ideas (such as mathematical algorithms), natural phenomena, and laws of nature are not eligible and therefore are excluded from patent protection.
"A principle, in the abstract, is a fundamental truth; an original cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive right." Instead, such "manifestations of laws of nature" are "part of the storehouse of knowledge," "free to all men and reserved exclusively to none."
Thus, "a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter" under Section 101. "Likewise, Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law of gravity." Nor can one patent "a novel and useful mathematical formula," Flook, 437 U.S. at 585, 198 USPQ at 195; electromagnetism or steam power, O'Reilly v. Morse, 56 U.S. (15 How.) 62, 113-114 (1853); or "[t]he qualities of * * * bacteria, * * * the heat of the sun, electricity, or the qualities of metals," Funk, 333 U.S. at 130, 76 USPQ at 281; see Le Roy, 55 U.S. (14 How.) at 175.
While abstract ideas, natural phenomena, and laws of nature are not eligible for patenting, methods and products employing abstract ideas, natural phenomena, and laws of nature to perform a real-world function may well be. In evaluating whether a claim meets the requirements of section 101, the claim must be considered as a whole to determine whether it is for a particular application of an abstract idea, natural phenomenon, or law of nature, rather than for the abstract idea, natural phenomenon, or law of nature itself.
Determine Whether the Claimed Invention Covers Either a § 101 Judicial Exception or a Practical Application of a § 101 Judicial Exception
An examiner must ascertain the scope of the claim to determine whether it covers either a § 101 judicial exception or a practical application of a § 101 judicial exception. The conclusion that a particular claim includes a § 101 judicial exception does not end the inquiry because "[i]t is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection." Diehr, 450 U.S. at 187, 209 USPQ at 8 (emphasis in original); accord Flook, 437 U.S. at 590, 198 USPQ at 197; Benson, 409 U.S. at 67, 175 USPQ at 675.
Thus, "[w]hile a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid of knowledge of scientific truth may be." Diehr, 450 U.S. at 188, 209 USPQ at 8-9 (quoting Mackay, 306 U.S. at 94); see also Corning v. Burden, 56 U.S. (15 How.) 252, 268, 14 L.Ed. 683 (1854)("It is for the discovery or invention of some practical method or means of producing a beneficial result or effect, that a patent is granted . . .").
2. Determine Whether the Claimed Invention is a Practical Application of an Abstract Idea, Law of Nature, or Natural Phenomenon (§ 101 Judicial Exceptions)
For claims including such excluded subject matter to be eligible, the claim must be for a practical application of the abstract idea, law of nature, or natural phenomenon. Diehr, 450 U.S. at 187, 209 USPQ at 8 ("application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection."); Benson, 409 U.S. at 71, 175 USPQ at 676 (rejecting formula claim because it "has no substantial practical application").
To satisfy section 101 requirements, the claim must be for a practical application of the § 101 judicial exception, which can be identified in various ways:
The claimed invention "transforms" an article or physical object to a different state or thing.
The claimed invention otherwise produces a useful, concrete and tangible result, based on the factors discussed below.
a. Practical Application by Physical Transformation
The examiner first shall review the claim and determine if it provides a transformation or reduction of an article to a different state or thing. If the examiner finds such a transformation or reduction, the examiner shall end the inquiry and find that the claim meets the statutory requirement of 35 U.S.C. § 101. If the examiner does not find such a transformation or reduction, the examiner has not determined as a final matter that the claim is non-statutory. The examiner must proceed in further inquiry.
b. Practical Application That Produces a Useful, Concrete, and Tangible Result For eligibility analysis, physical transformation "is not an invariable requirement, but merely one example of how a mathematical algorithm [or law of nature] may bring about a useful application." AT&T, 172 F.3d at 1358-59, 50 USPQ2d at 1452. If the examiner determines that the claim does not entail the transformation of an article, then the examiner shall review the claim to determine if the claim provides a practical application that produces a useful, tangible and concrete result. In determining whether the claim is for a "practical application," the focus is not on whether the steps taken to achieve a particular result are useful, tangible and concrete, but rather that the final result achieved by the claimed invention is "useful, tangible and concrete." In determining whether a claim provides a practical application that produces a useful, tangible, and concrete result, the examiner should consider and weigh the following factors:
(1) "USEFUL RESULT" For an invention to be "useful" it must satisfy the utility requirement of section 101. The USPTO's official interpretation of the utility requirement provides that the utility of an invention has to be (i) specific, (ii) substantial and (iii) credible.
In addition, when the examiner has reason to believe that the claim is not for a practical application that produces a useful result, the claim should be rejected, thus requiring the applicant to distinguish the claim from the three § 101 judicial exceptions to patentable subject matter by specifically reciting in the claim the practical application. In such cases, statements in the specification describing a practical application may not be sufficient to satisfy the requirements for section 101 with respect to the claimed invention. Likewise, a claim that can be read so broadly as to include statutory and nonstatutory subject matter must be amended to limit the claim to a practical application.
(2) "TANGIBLE RESULT" The tangible requirement does not necessarily mean that a claim must either be tied to a particular machine or apparatus or must operate to change articles or materials to a different state or thing. However, the tangible requirement does require that the claim must recite more than a § 101 judicial exception, in that the process claim must set forth a practical application of that § 101 judicial exception to produce a real-world result. In other words, the opposite meaning of "tangible" is "abstract."
(3) "CONCRETE RESULT" Another consideration is whether the invention produces a "concrete" result. Usually, this question arises when a result cannot be assured. In other words, the process must have a result that can be substantially repeatable or the process must substantially produce the same result again. The opposite of "concrete" is unrepeatable or unpredictable. Resolving this question is dependent on the level of skill in the art. For example, if the claimed invention is for a process which requires a particular skill, to determine whether that process is substantially repeatable will necessarily require a determination of the level of skill of the ordinary artisan in that field. An appropriate rejection under 35 U.S.C. § 101 should be accompanied by a lack of enablement rejection under 35 U.S.C. § 112, paragraph 1, where the invention cannot operate as intended without undue experimentation.
3. Determine Whether the Claimed Invention Preempts an Abstract Idea, Law of Nature, or Natural Phenomenon (§ 101 Judicial Exceptions) Even when a claim applies a mathematical formula, for example, as part of a seemingly patentable process, the examiner must ensure that it does not in reality "seek patent protection for that formula in the abstract." "Phenomena of nature, though just discovered, mental processes, abstract intellectual concepts are not patentable, as they are the basic tools of scientific and technological work." One may not patent a process that comprises every "substantial practical application" of an abstract idea, because such a patent "in practical effect would be a patent on the [abstract idea] itself." Thus, a claim that recites a computer that solely calculates a mathematical formula (see Benson) or a computer disk that solely stores a mathematical formula is not directed to the type of subject matter eligible for patent protection. If an examiner determines that the claimed invention preempts a § 1 01 judicial exception, the examiner must identify the abstraction, law of nature, or natural phenomenon and explain why the claim covers every substantial practical application thereof.
V. EVALUATE APPLICATION FOR COMPLIANCE WITH 35 U.S.C. § 112 A. Determine Whether the Claimed Invention Complies with 35 U.S.C. § 112, Second Paragraph Requirements (MPEP § 2171) The second paragraph of 35 U.S.C. § 112 contains two separate and distinct requirements: (A) that the claim(s) set forth the subject matter applicants regard as the invention, and (B) that the claim(s) particularly point out and distinctly claim the invention. An application will be deficient under the first requirement of 35 U.S.C. § 112, second paragraph when evidence including admissions, other than in the application as filed, shows applicant has stated that he or she regards the invention to be different from what is claimed (see MPEP § 2171-2172.01). An application fails to comply with the second requirement of 35 U.S.C. § 112, second paragraph when the claims do not set out and define the invention with a reasonable degree of precision and particularity. In this regard, the definiteness of the language must be analyzed, not in a vacuum, but always in light of the teachings of the disclosure as it would be interpreted by one of ordinary skill in the art. Applicant's claims, interpreted in light of the disclosure, must reasonably apprise a person of ordinary skill in the art of the invention. The scope of a "means" limitation is defined as the corresponding structure or material set forth in the written description and equivalents. See MPEP § 2181 through § 2186. See MPEP § 2173 et seq. for a discussion of a variety of issues pertaining to the 35 U.S.C. § 112, second paragraph requirement that the claims particularly point out and distinctly claim the invention.
DETERMINE WHETHER THE CLAIMED INVENTION COMPLIES WITH 35 U.S.C. § 102 AND 103 .
Improper Tests for Subject Matter Eligibility:
(A) "not in the technological arts" test
(B) Freeman-Walter-Abele test
(C) mental step or human step tests
(D) the machine implemented test
(E) the per se data transformation test
Electro-Magnetic Signals
Claims that recite nothing but the physical characteristics of a form of energy, such as a frequency, voltage, or the strength of a magnetic field, define energy or magnetism, per se, and as such are nonstatutory natural phenomena. Moreover, it does not appear that a claim reciting a signal encoded with functional descriptive material falls within any of the categories of patentable subject matter set forth in section 101.
These Guidelines made it difficult to obtain coverage for software delivered over the Internet (signal claims) and resulted in Examiners again issuing rejections of patent applications covering software related inventions as non-statutory. For example, I received 101 rejections against Beauregard claims. I also received an increased amount of improper 112 rejections for software related inventions, in combination with 101 rejections.
Because this is an important historical document, I have placed a copy on my web server, and it is available here:
http://www.patentsusa.com/2005_Interim_Guidelines.pdf
The Guidelines, in my view, resulted in Examiners again routinely raising rejections of software related applications under 35 U.S.C. 101, after years of acceptance of the statutory nature of software related inventions. The Examiners are raising these issues again even though the Guidelines state that software related applications can be statutory, and were primarily drafted to discuss business method inventions. What I feel to be some of the most relevant portions are reproduced here:
In the mid-1990's, the USPTO sought to clarify the legal requirements for statutory subject matter with regard to computer-related inventions. See Examination Guidelines for Computer Related Inventions, 61 Fed. Reg. 7478 (1996). Subsequent to the publication of those guidelines, the Court of Appeals for the Federal Circuit issued opinions in State Street Bank & Trust Co. v. Signature Financial Group Inc., and AT&T Corp. v. Excel Communications, Inc. These decisions explained that, to be eligible for patent protection, the claimed invention as a whole must accomplish a practical application. That is, it must produce a "useful, concrete and tangible result." Since this time, the USPTO has seen increasing numbers of applications outside the realm of computer-related inventions that raise subject matter eligibility issues. In order to assist examiners in identifying and resolving these issues, the USPTO is issuing these interim examination guidelines to assist USPTO personnel in the examination of patent applications to determine whether the subject matter as claimed is eligible for patent protection. The principal objective of these guidelines is to assist examiners in determining, on a case-by-case basis, whether a claimed invention falls within a judicial exception to statutory subject matter (i.e., is nothing more than an abstract idea, law of nature, or natural phenomenon), or whether it is a practical application of a judicial exception to statutory subject matter.
The guidelines explain that a practical application of a 35 U.S.C. § 101 judicial exception is claimed if the claimed invention physically transforms an article or physical object to a different state or thing, or if the claimed invention otherwise produces a useful, concrete, and tangible result.
The claimed invention as a whole must be useful and accomplish a practical application. That is, it must produce a "useful, concrete and tangible result." The applicant is in the best position to explain why an invention is believed useful. Accordingly, a complete disclosure should contain some indication of the practical application for the claimed invention, i.e., why the applicant believes the claimed invention is useful. Such a statement will usually explain the purpose of the invention or how the invention may be used (e.g., a compound is believed to be useful
in the treatment of a particular disorder). Regardless of the form of statement of utility, it must enable one ordinarily skilled in the art to understand why the applicant believes the claimed invention is useful. See MPEP § 2107 for utility examination guidelines. An applicant may assert more than one utility and practical application, but only one is necessary.
DETERMINE WHETHER THE CLAIMED INVENTION COMPLIES WITH THE SUBJECT MATTER ELIGIBILITY REQUIREMENT OF 35 U.S.C. § 101
Determine Whether the Claimed Invention Falls Within An Enumerated Statutory Category
To properly determine whether a claimed invention complies with the statutory invention requirements of 35 U.S.C. § 101, USPTO personnel must first identify whether the claim falls within at least one of the four enumerated categories of patentable subject matter recited in section 101 (process, machine, manufacture or composition of matter). In many instances it is clear within which of the enumerated categories a claimed invention falls. Even if the characterization of the claimed invention is not clear, this is usually not an issue that will preclude making an accurate and correct assessment with respect to the section 101 analysis. The scope of 35 U.S.C. § 101 is the same regardless of the form or category of invention in which a particular claim is drafted. Note that an apparatus claim with process steps is not classified as a "hybrid" claim; instead, it is simply an apparatus claim including functional limitations.
The burden is on the USPTO to set forth a prima facie case of unpatentability. Therefore if the examiner determines that it is more likely than not that the claimed subject matter falls outside all of the statutory categories, the examiner must provide an explanation. The examiner must further continue with the statutory subject matter analysis as set forth below. Also, the examiner must still examine the claims for compliance with 35 U.S.C. §§ 102, 103, and 112.
If the invention as set forth in the written description is statutory, but the claims define subject matter that is not, the deficiency can be corrected by an appropriate amendment of the claims. In such a case, USPTO personnel should reject the claims drawn to nonstatutory subject matter under 35 U.S.C. § 101, but identify the features of the invention that would render the claimed subject matter statutory if recited in the claim.
Determine Whether the Claimed Invention Falls Within § 101 Judicial Exceptions - Laws of Nature, Natural Phenomena and Abstract Ideas
Determining whether the claim falls within one of the four enumerated categories of patentable subject matter recited in 35 U.S.C. § 101 (process, machine, manufacture or composition of matter) does not end the analysis because claims directed to nothing more than abstract ideas (such as mathematical algorithms), natural phenomena, and laws of nature are not eligible and therefore are excluded from patent protection.
"A principle, in the abstract, is a fundamental truth; an original cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive right." Instead, such "manifestations of laws of nature" are "part of the storehouse of knowledge," "free to all men and reserved exclusively to none."
Thus, "a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter" under Section 101. "Likewise, Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law of gravity." Nor can one patent "a novel and useful mathematical formula," Flook, 437 U.S. at 585, 198 USPQ at 195; electromagnetism or steam power, O'Reilly v. Morse, 56 U.S. (15 How.) 62, 113-114 (1853); or "[t]he qualities of * * * bacteria, * * * the heat of the sun, electricity, or the qualities of metals," Funk, 333 U.S. at 130, 76 USPQ at 281; see Le Roy, 55 U.S. (14 How.) at 175.
While abstract ideas, natural phenomena, and laws of nature are not eligible for patenting, methods and products employing abstract ideas, natural phenomena, and laws of nature to perform a real-world function may well be. In evaluating whether a claim meets the requirements of section 101, the claim must be considered as a whole to determine whether it is for a particular application of an abstract idea, natural phenomenon, or law of nature, rather than for the abstract idea, natural phenomenon, or law of nature itself.
Determine Whether the Claimed Invention Covers Either a § 101 Judicial Exception or a Practical Application of a § 101 Judicial Exception
An examiner must ascertain the scope of the claim to determine whether it covers either a § 101 judicial exception or a practical application of a § 101 judicial exception. The conclusion that a particular claim includes a § 101 judicial exception does not end the inquiry because "[i]t is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection." Diehr, 450 U.S. at 187, 209 USPQ at 8 (emphasis in original); accord Flook, 437 U.S. at 590, 198 USPQ at 197; Benson, 409 U.S. at 67, 175 USPQ at 675.
Thus, "[w]hile a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid of knowledge of scientific truth may be." Diehr, 450 U.S. at 188, 209 USPQ at 8-9 (quoting Mackay, 306 U.S. at 94); see also Corning v. Burden, 56 U.S. (15 How.) 252, 268, 14 L.Ed. 683 (1854)("It is for the discovery or invention of some practical method or means of producing a beneficial result or effect, that a patent is granted . . .").
2. Determine Whether the Claimed Invention is a Practical Application of an Abstract Idea, Law of Nature, or Natural Phenomenon (§ 101 Judicial Exceptions)
For claims including such excluded subject matter to be eligible, the claim must be for a practical application of the abstract idea, law of nature, or natural phenomenon. Diehr, 450 U.S. at 187, 209 USPQ at 8 ("application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection."); Benson, 409 U.S. at 71, 175 USPQ at 676 (rejecting formula claim because it "has no substantial practical application").
To satisfy section 101 requirements, the claim must be for a practical application of the § 101 judicial exception, which can be identified in various ways:
The claimed invention "transforms" an article or physical object to a different state or thing.
The claimed invention otherwise produces a useful, concrete and tangible result, based on the factors discussed below.
a. Practical Application by Physical Transformation
The examiner first shall review the claim and determine if it provides a transformation or reduction of an article to a different state or thing. If the examiner finds such a transformation or reduction, the examiner shall end the inquiry and find that the claim meets the statutory requirement of 35 U.S.C. § 101. If the examiner does not find such a transformation or reduction, the examiner has not determined as a final matter that the claim is non-statutory. The examiner must proceed in further inquiry.
b. Practical Application That Produces a Useful, Concrete, and Tangible Result For eligibility analysis, physical transformation "is not an invariable requirement, but merely one example of how a mathematical algorithm [or law of nature] may bring about a useful application." AT&T, 172 F.3d at 1358-59, 50 USPQ2d at 1452. If the examiner determines that the claim does not entail the transformation of an article, then the examiner shall review the claim to determine if the claim provides a practical application that produces a useful, tangible and concrete result. In determining whether the claim is for a "practical application," the focus is not on whether the steps taken to achieve a particular result are useful, tangible and concrete, but rather that the final result achieved by the claimed invention is "useful, tangible and concrete." In determining whether a claim provides a practical application that produces a useful, tangible, and concrete result, the examiner should consider and weigh the following factors:
(1) "USEFUL RESULT" For an invention to be "useful" it must satisfy the utility requirement of section 101. The USPTO's official interpretation of the utility requirement provides that the utility of an invention has to be (i) specific, (ii) substantial and (iii) credible.
In addition, when the examiner has reason to believe that the claim is not for a practical application that produces a useful result, the claim should be rejected, thus requiring the applicant to distinguish the claim from the three § 101 judicial exceptions to patentable subject matter by specifically reciting in the claim the practical application. In such cases, statements in the specification describing a practical application may not be sufficient to satisfy the requirements for section 101 with respect to the claimed invention. Likewise, a claim that can be read so broadly as to include statutory and nonstatutory subject matter must be amended to limit the claim to a practical application.
(2) "TANGIBLE RESULT" The tangible requirement does not necessarily mean that a claim must either be tied to a particular machine or apparatus or must operate to change articles or materials to a different state or thing. However, the tangible requirement does require that the claim must recite more than a § 101 judicial exception, in that the process claim must set forth a practical application of that § 101 judicial exception to produce a real-world result. In other words, the opposite meaning of "tangible" is "abstract."
(3) "CONCRETE RESULT" Another consideration is whether the invention produces a "concrete" result. Usually, this question arises when a result cannot be assured. In other words, the process must have a result that can be substantially repeatable or the process must substantially produce the same result again. The opposite of "concrete" is unrepeatable or unpredictable. Resolving this question is dependent on the level of skill in the art. For example, if the claimed invention is for a process which requires a particular skill, to determine whether that process is substantially repeatable will necessarily require a determination of the level of skill of the ordinary artisan in that field. An appropriate rejection under 35 U.S.C. § 101 should be accompanied by a lack of enablement rejection under 35 U.S.C. § 112, paragraph 1, where the invention cannot operate as intended without undue experimentation.
3. Determine Whether the Claimed Invention Preempts an Abstract Idea, Law of Nature, or Natural Phenomenon (§ 101 Judicial Exceptions) Even when a claim applies a mathematical formula, for example, as part of a seemingly patentable process, the examiner must ensure that it does not in reality "seek patent protection for that formula in the abstract." "Phenomena of nature, though just discovered, mental processes, abstract intellectual concepts are not patentable, as they are the basic tools of scientific and technological work." One may not patent a process that comprises every "substantial practical application" of an abstract idea, because such a patent "in practical effect would be a patent on the [abstract idea] itself." Thus, a claim that recites a computer that solely calculates a mathematical formula (see Benson) or a computer disk that solely stores a mathematical formula is not directed to the type of subject matter eligible for patent protection. If an examiner determines that the claimed invention preempts a § 1 01 judicial exception, the examiner must identify the abstraction, law of nature, or natural phenomenon and explain why the claim covers every substantial practical application thereof.
V. EVALUATE APPLICATION FOR COMPLIANCE WITH 35 U.S.C. § 112 A. Determine Whether the Claimed Invention Complies with 35 U.S.C. § 112, Second Paragraph Requirements (MPEP § 2171) The second paragraph of 35 U.S.C. § 112 contains two separate and distinct requirements: (A) that the claim(s) set forth the subject matter applicants regard as the invention, and (B) that the claim(s) particularly point out and distinctly claim the invention. An application will be deficient under the first requirement of 35 U.S.C. § 112, second paragraph when evidence including admissions, other than in the application as filed, shows applicant has stated that he or she regards the invention to be different from what is claimed (see MPEP § 2171-2172.01). An application fails to comply with the second requirement of 35 U.S.C. § 112, second paragraph when the claims do not set out and define the invention with a reasonable degree of precision and particularity. In this regard, the definiteness of the language must be analyzed, not in a vacuum, but always in light of the teachings of the disclosure as it would be interpreted by one of ordinary skill in the art. Applicant's claims, interpreted in light of the disclosure, must reasonably apprise a person of ordinary skill in the art of the invention. The scope of a "means" limitation is defined as the corresponding structure or material set forth in the written description and equivalents. See MPEP § 2181 through § 2186. See MPEP § 2173 et seq. for a discussion of a variety of issues pertaining to the 35 U.S.C. § 112, second paragraph requirement that the claims particularly point out and distinctly claim the invention.
DETERMINE WHETHER THE CLAIMED INVENTION COMPLIES WITH 35 U.S.C. § 102 AND 103 .
Improper Tests for Subject Matter Eligibility:
(A) "not in the technological arts" test
(B) Freeman-Walter-Abele test
(C) mental step or human step tests
(D) the machine implemented test
(E) the per se data transformation test
Electro-Magnetic Signals
Claims that recite nothing but the physical characteristics of a form of energy, such as a frequency, voltage, or the strength of a magnetic field, define energy or magnetism, per se, and as such are nonstatutory natural phenomena. Moreover, it does not appear that a claim reciting a signal encoded with functional descriptive material falls within any of the categories of patentable subject matter set forth in section 101.
These Guidelines made it difficult to obtain coverage for software delivered over the Internet (signal claims) and resulted in Examiners again issuing rejections of patent applications covering software related inventions as non-statutory. For example, I received 101 rejections against Beauregard claims. I also received an increased amount of improper 112 rejections for software related inventions, in combination with 101 rejections.
2005 Interim Guidelines for Subject Matter Eligibility
The following guidelines were provided by Robert Weinhardt, Business Practice Specialist in Technology Center 3600 to assist Examiners determine whether business method patent applications are or are not statutory subject matter. Because this may turn out to be an important historic document, it is reproduced below in its entirety. Note that signals and rules of games are stated to be per se non-statutory.
Interim Guidelines
* Purpose: To assist examiners in determining whether a claim is directed to statutory subject matter under 35 U.S.C. § 101.
* Published in the O.G. 11/22/2005
* Period for public commentary runs until June 30, 2006.
* Submit comments via email addressed to: AB98.Comments@uspto.gov
Additional submission information found in the Federal Register Vol. 70, No. 243, 75451-75452 (Tues, Dec. 20, 2005)
The Interim Guidelines, hereinafter “Guidelines,” are intended to assist examiners in determining whether a claim is directed to statutory subject matter under 35 USC 101. They were posted on the USPTO web site on October 26, 2005, and published in the Official Gazette on November 22, 2005. These Guidelines are based on the USPTO’s current understanding of the law and are believed to be fully consistent with binding precedent of the Supreme Court, the Federal Circuit and the Federal Circuit’s predecessor courts.
These Guidelines do not constitute substantive rulemaking and hence do not have the force and effect of law. The Guidelines set forth the procedures USPTO personnel will follow when examining applications. USPTO personnel are to rely on these Guidelines in the event of any inconsistent treatment of issues between these Guidelines and any earlier provided guidance, including existing MPEP 2106, from the USPTO.
The Guidelines are not meant to be all encompassing for every possible scenario that may occur. Instead, they are intended to provide the rationale examiners and other USPTO personnel should follow to determine whether statutory subject matter is being claimed on a case-by-case basis.
Interim Guidelines Intro
What’s In:
* Statutory Categories
* Judicial Exceptions
* Practical Application
* Preemption
There were numerous tests being applied by examiners to determine whether patent eligible subject matter was being claimed. The Guidelines clarify the analysis to be applied and illustrate the prior tests not to be applied.
The statutory categories of invention. USPTO personnel must first identify whether the claim falls within one of the four enumerated categories of patentable subject matter recited in section 101 (process, machine, manufacture or composition of matter);
Judicial Exceptions. Claims directed to nothing more than abstract ideas (such as mathematical algorithms), natural phenomena, and laws of nature are not eligible and therefore are excluded from patent protection.
Practical Application. To be patent eligible, claims including limitation(s) that set forth subject matter excluded by a judicial exception must be for a practical application, e.g. of an abstract idea, law of nature, or natural phenomenon. A practical application results, for example, if the claimed invention “transforms” an article or physical object to a different state or thing; or if the claimed invention produces a useful, concrete and tangible result.
Preemption. Even when a claim applies an abstract idea as part of a seemingly patent eligible product or process, USPTO personnel must ensure that it does not in reality provide patent protection for every substantial practical application (including undisclosed applications) of the abstract idea. That would be, in effect, a patent on the abstract idea itself. Notice how this criterion meshes with 112, first paragraph.
What’s Out:
* “Not in the Technological Arts”
* Freeman-Walter-Abele
* Mental Steps or Human Steps
* Machine Implemented
* Data Transformation
The following tests previously applied by some examiners are not determinative of patent-eligible subject matter and should not be used as rationale for rejecting claims under 35 USC 101.
The “Not in the technological arts” criterion. USPTO personnel should no longer rely on the technological arts test to determine whether a claimed invention is directed to statutory subject matter. There are no other recognized exceptions to eligible subject matter other than laws of nature, natural phenomena, and abstract ideas.
Freeman-Walter-Abele. USPTO personnel should not rely on the Freeman-Walter-Abele test, i.e., “data gathering steps” or “insignificant post solution activity,” to determine whether a claimed invention is directed to statutory subject matter.
Mental steps or human steps. Even if all the steps of a claimed process can be carried out in the human mind, examiners must still determine whether the claimed process produces a useful, concrete, and tangible result, i.e., apply the practical application test set forth in State Street. The fact that some or all steps of a claimed process can be performed by a human is likewise not an appropriate rationale for rejection. To be patent-eligible, however, the steps must produce either a physical transformation or a useful, concrete and tangible result.
Machine implemented. Whether a claim recites a machine implemented process is not determinative of whether that process claim is statutory. Thus, a finding that a claim fails to recite a computer-implemented process is not determinative in whether that claim passes muster under § 101.
Data transformation. Identifying that a claim transforms data from one value to another is not by itself sufficient for determining whether the claim is eligible for patent protection.
Claims previously rejected under any of the above rationale are not necessarily patent-eligible (i.e., statutory). A rejection may still be reasonable under 101 after applying the appropriate tests set forth in the Interim Guidelines.
Prerequisites to Analysis Under 101
Determine what applicant invented
* Review the spec and claims.
* Identify and understand:
o Any utility and/or practical application asserted by applicant;
o The meaning of claim terms; and Claim scope.
Conduct a thorough search.
* What is known in the art can contribute to understanding the invention.
Prior to any analysis under §101, it is critical that the examiner determine what applicant invented and is seeking to patent. This starts by a review of the specification and the claims. From this, the examiner needs to identify and understand:
Any utility and/or practical application asserted by the applicant. The claimed invention as a whole must be useful and accomplish a practical application. The applicant is in the best position to explain why an invention is believed useful. Accordingly, a complete disclosure should contain some indication of the practical application for the claimed invention, i.e., why the applicant believes the claimed invention is useful. MPEP 2107 provides details for the analysis of utility, but can be summarized in that practical application must be specific, substantial and credible.
The meaning of claim terms. The claims define the property rights provided by a patent, and thus require careful scrutiny. USPTO personnel must always remember to use the perspective of one of ordinary skill in the art in determining the meaning of claim terms. Claims and disclosures are not to be evaluated in a vacuum. The goal of claim analysis is to identify the boundaries of the protection sought by the applicant and to understand how the claims relate to and define what the applicant has indicated is the invention. Only where an explicit definition is provided in the disclosure by the applicant for a term will that definition control interpretation of the term as it is used in the claim. The courts have indicated that such a definition constitutes an unambiguous surrender of subject matter outside such a definition.
Claim scope. The variance in claim scope among the claims must be ascertained. This often provides guidance as to applicant’s intent for what is to be included in the coverage of some claims with respect to others. Likewise, the specification may provide evidence of what Applicant intends to be included within the metes and bounds of particular terms used in the claims.
Conduct a thorough search. What is known in the art can contribute to understanding the invention. Because the perspective of one of ordinary skill in the art is used in the analysis, the result of such a search will contribute to USPTO personnel’s understanding of the invention.
Analysis Under 101
The prerequisites having been completed, now the analysis can begin. Analysis for determining patent eligible subject matter under §101 is a 4 step process:
1. Does the claimed invention fall within one of the four statutory categories?
2. Does the claimed invention fall within a judicial exception?
3. Does the claimed invention provide a practical application?
4. Does the claimed invention wholly preempt all substantial applications of a judicial exception?
All four steps must be applied to each and every claim to form a complete analysis.
1) Statutory Categories
What do we grant patents for?
* 35 U.S.C. §101 reads: “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 therefore, subject to the conditions and requirements of this title.”
First step, answer the question, “Does the claimed invention fall within one of the four categories of invention?”
Note that it does not matter which of the four statutory categories of invention as long as it falls within one of the four. The analysis is the same regardless to which category the claim is directed.
The statutory categories of invention are set forth in 35 USC 101, which reads, “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 therefore, subject to the conditions and requirements of this title.”
* A “machine”, “manufacture”, and “composition of matter” all define things or products.
* A “process” defines actions i.e. inventions that set forth a series of steps or acts to performed.
A “machine”, “manufacture”, and “composition of matter” all define things or products.
A “process” defines actions i.e. inventions that set forth a series of steps or acts to performed. This is often done in the form of method claims. This is not to be confused with a manufacture (e.g., memory, computer-readable medium) having instructions stored in or on it for causing steps to be performed when the instructions are executed. Such claims are directed to the manufacture. Likewise, a machine that is claimed in terms of statements of intended use or field of use, “adapted to/for” or “configured to/for” clauses, “wherein” clauses, or “whereby” clauses is a claim directed to the machine. If it appears the claim is directed to multiple statutory categories of invention, see the analysis in MPEP 2173.05(p).
Not in One of the Statutory Categories
Some examples of things that are not included in one of the statutory categories of invention are:
1. Literary works, per se, including story lines and movie plots.
2. Rules to play a game, per se.
3. Legal agreements, per se. For example, a claim to an insurance policy, as contrasted with the method of creating the characteristics of such a policy, would not be patent eligible subject matter.
4. Signals, per se. This includes signals carrying instructions or other functional descriptive material and is covered more thoroughly in Annex IV of the Guidelines.
5. A computer program, logic or language, per se.
These are only a few of the myriad of examples of subject matter which applicants have sought to patent but are not currently believed to be patent eligible subject matter under §101.
If Not, Don’t Stop
* If the examiner can establish that a claim does not fall into a statutory category, that does not preclude complete examination for all other conditions of patentability.
* The examiner must continue with the 101 analysis and must still examine the claims for compliance with 102, 103 and 112.
Even if the examiner can establish that a claim does not fall into a statutory category and sets forth a reasonable position in a rejection that the claims are non-statutory, that does not preclude complete examination for all other conditions of patentability. The examiner must continue with the §101 analysis, including that for double patenting, and do a complete analysis under §112. A search must be completed based on the claims as best understood, and any applicable prior art used to formulate rejections under §102 or §103. In short, don’t stop or short circuit the examination. Make sure to include all appropriate rejections and objections at the time of the first action on the merits.
2) Judicial Exceptions
Does the claimed invention fall within a judicial exception?
Despite the apparent sweeping breadth of 35 USC 101, and the often quoted “anything under the sun that is made by man.” statement made by the Supreme Court in Diamond v. Chakrabarty, 447 U.S. 303, 308-09, 206 USPQ 193, 197 (1980), the Supreme Court has identified three judicial exception categories of nonstatutory subject matter.
They are:
* Laws of nature, per se;
* Natural phenomena, per se; and
* Abstract ideas, per se.
Judicial Exception Examples
Examples of Judicial Exceptions are:
* Laws of nature
o e=mc2; f=ma
* Natural phenomena
o the heat of the sun; electricity; a new mineral; electromagnetism (Charles Morse)
* Abstract ideas
o mathematical algorithms; legal rights
While it’s not likely you would see a claim in the exact form listed in any of the above examples, it is quite possible that you may encounter a product claim with characteristics that are nothing more than a law of nature, a method claim which includes steps to an abstract idea, or a composition of matter claim which turns out to include a natural phenomena. Such claims are common and further analysis is required to determine if they are attempting to, per se, claim a judicial exception.
If Yes, Don’t Stop
* If a judicial exception is found in the claim, further analysis under 101 is required.
* If a judicial exception is not found in the claim, the claim must fall within a statutory category and meet the other conditions of 101.
Even if the examiner can establish that a judicial exception is found in the claim, further analysis is required to determine whether a practical application of the exception is being claimed and whether preemption applies. A complete examination for all other conditions of patentability must occur. The examiner must continue with the §101 analysis, including double patenting, and do a complete analysis under §112. A search must be completed based on the claims as best understood, and any applicable prior art used to formulate rejections under §102 or §103. In short, don’t stop the examination. The reason is easily seen – the subject matter rejection may be overcome by amendment, leaving the remaining issues on the table unless the examiner has raised them already.
If a judicial exception is not found in the claim, and the claim does fall within a statutory category, it is considered eligible for patenting but must still meet the other conditions of 101, e.g., utility.
3) Practical Application
* Two ways to provide a practical application of a judicial exception:
o Physical Transformation,
o OR Produce A Useful, Concrete, and Tangible Result
Does the claimed invention provide a practical application of a judicial exception?
As mentioned previously, even if the claim does not appear to fall within a statutory category of invention, the analysis under §101 must continue to determine if the claim recites a practical application. If not, that would be further rationale in support of the rejection. Likewise, even if a claim recites a judicial exception, the analysis must continue. The next step in the analysis is to determine if the claim recites a practical application of the exception or just the judicial exception. A claim directed to a practical application of the exception may be directed to patent eligible subject matter, while a claim directed to the exception itself is not. A claim is directed to a practical application when there is either a physical transformation or when a useful, concrete and tangible result is produced. An easily seen instance of such a result is a physical transformation performed by the process or machine claimed, so looking for a physical transformation as a result of the claimed subject matter is an efficient manner of passing this test.
Physical Transformation
* The claimed invention transforms an article or physical object to a different state or thing.
* If transformation is found, this ends the analysis for statutory subject matter.
* Transformation of data is not “physical transformation,” nor are physical acts necessarily a “physical transformation.”
* Example: manufacturing a tire by curing rubber.
Physical transformation occurs when the claimed invention transforms an article or physical object to a different structural state or thing. Physical transformation is an indication that the claim is statutory because such a transformation itself is a useful, tangible and concrete result. However, data transformation is not a physical transformation. Data, by definition, is intangible, so the claim must go further to have a tangible result. Thus, manipulation of data in a computer is not, in and of itself, sufficient for establishing that a claim is statutory. Likewise, a physical act is not necessarily a physical transformation. A physical act may, however, provide a useful, concrete and tangible result to establish patent-eligible subject matter. An example of physical transformation rendering a practical application of a judicial exception statutory is a claim to manufacturing a tire by curing rubber, where the curing time is calculated according to a mathematical equation.
* Even if a judicial exception is a limitation of the claimed invention, e.g. a law of nature, if it is applied in the physical transformation, a practical application is provided.
* The claims still need to be checked for utility under 101 however.
Inclusion of a judicial exception as a limitation of a claimed invention does not preclude the claim from being statutory where the claim as a whole is directed to a practical application because a physical transformation has taken place. However, the claim still needs to be checked to determine if it meets the utility requirement under 35 USC 101. For example, claims directed to production of excess energy or perpetual motion may arguably involve a physical transformation, yet they would raise the issue of lacking utility and/or inoperative to be addressed under 101.
Useful, Concrete, Tangible
* If no physical transformation appears in the claim, check for a “useful, concrete and tangible result”.
* The focus is on the result, not the steps or structure used to produce the result.
* A useful, concrete and tangible result must be either specifically recited in the claim or flow inherently therefrom.
If no physical transformation appears in the claim then the next step in the analysis is to determine if the claim is otherwise directed to a useful, concrete and tangible result. The focus is on the result of the claim as a whole, not the individual steps or structure used to produce the result.
A useful, concrete and tangible result must be either specifically recited in the claim or flow inherently therefrom. To flow inherently therefrom, it must occur. If there is a reasonable exception or it is merely likely that it would occur, it does not “flow inherently therefrom” and the claim would need to be amended to specifically recite the result.
* Even if a judicial exception is a limitation of the claimed invention, e.g. a law of nature, if it is applied to produce a useful, concrete and tangible result, a practical application is provided.
Inclusion of a judicial exception as a limitation of a claimed invention does not preclude the claim from being statutory where the claim as a whole is directed to a practical application because a useful, concrete and tangible result has taken place. However, the claim still needs to be checked to determine if it meets the utility requirement under 35 USC 101.
“Useful”
* The claimed invention as a whole must satisfy the utility requirement of 101:
o specific,
o substantial, and
o credible utility.
* These criteria require evaluation of the specification and the knowledge in the art.
When no physical transformation is found, the first factor of the second test for practical application is a determination of whether the claimed invention produces a useful result. For an invention to be “useful” it must satisfy the utility requirement of section 101. The USPTO’s official interpretation of the utility requirement provides that the utility of a claimed invention has to be (i) specific, (ii) substantial and (iii) credible. See MPEP 2107 for further guidance on these 3 points.
Determining whether the claimed invention is specific, substantial and credible also requires evaluation of the specification and knowledge in the art, hence the need for the prerequisites of determining what applicant invented and conducting a thorough search prior to analysis under 101.
The disclosure may have met the requirements for utility, but what’s claimed does not produce a result that reflects it or is too preliminary in and of itself to be a useful result. In these instances, the claimed invention may not provide a useful result even though an appropriate utility has been disclosed, and a rejection as non-statutory would be appropriate.
* A complete disclosure should contain some indication of why the claimed invention is useful.
* If the claimed invention does not fulfill any of the disclosed utilities, determine if the utility would have been recognized by those in the art.
When checking the disclosure to determine what applicant invented, a complete disclosure should contain some indication of why the claimed invention is useful.
If the specification discloses a practical application of a 101 judicial exception, but the claim is broader than the disclosure such that it does not require a practical application, then the claim must be rejected.
If the claimed invention does not produce a useful result, i.e. fulfill any of the disclosed utilities, determine if any utility of the claimed result would have been recognized by those in the art as being specific, substantial and credible. If no utility for the result would have been recognized, then the claim must be rejected as non-statutory for failing to comply with 35 USC 101, i.e., not providing a useful, concrete and tangible result.
“Concrete”
* Usually, a claimed invention is not concrete when a result cannot be assured or is not reproducible.
* Concrete is not a requirement that the result must be 100% accurate (e.g., a claim directed to estimating, predicting or approximating something does not necessarily lack concreteness)
* May require a determination of the level of ordinary skill in the art.
The second factor in this test for practical application is a determination of whether the claimed invention produces a concrete result.
Usually, this question arises when a result cannot be assured. In other words, the process must have a result that can be substantially repeated. Note that the focus is on the result, not the steps themselves. For example, concrete data processing steps could still produce an unrepeatable result if the data being processed is subjective. However, the mere fact that the result is an estimate, prediction or other approximation that may not ultimately be found to be accurate is not a determinative factor for concreteness. Thus, an assured result refers to repeatability and ability to achieve a result rather than ultimate accuracy of the result.
As with the useful test, the prerequisites of determining what applicant invented and conducting a thorough search prior to analysis under 101 are needed in order to ascertain whether a particular result can be assured.
Enablement
* In instances where the invention cannot be used as intended without undue experimentation, an appropriate rejection of the claim as being nonstatutory under 35 U.S.C. 101 should be accompanied by a lack of enablement rejection under 35 U.S.C. 112 first paragraph.
When a rejection under §101 is made for lacking concreteness and the invention cannot operate as intended without undue experimentation because of the lack of repeatability or predictability, the §101 rejection should be accompanied by a lack of enablement rejection under 35 U.S.C. § 112, first paragraph.
Note that contrary to rejections made for lack of utility or inoperativeness under §101 which are always accompanied by a §112, first paragraph, rejection, the only time a §112, first paragraph rejection necessarily accompanies a §101 non-statutory rejection is when the issue is a lack of concreteness.
“Tangible”
* “Real world” result.
* Not necessarily tied to a machine; not a duplicate of “physical transformation”.
* In other words, the opposite of “tangible” is “abstract”.
* Thoughts are not “real world” results.
* Example: Calculating a price of an item to sell and then conveying the calculated price to a potential customer
The third and final factor in this test for practical application is a determination of whether the claimed invention produces a tangible result. The tangible requirement does not necessarily mean that a claim must either be tied to a particular machine or apparatus, or must operate to change articles or materials to a different state or thing. To be tangible the claim must recite more than a § 101 judicial exception, in that the process claim must set forth a practical application of that § 101 judicial exception to produce a real-world result.
If the result is merely a thought, this is not a tangible or real-world result. For example, merely determining or calculating a price may not be held to be a tangible result, instead reasonably being interpreted as just a thought or a computation within a processor; however, calculating a price of an item to sell and then conveying the calculated price to a potential customer would be a tangible result.
Descriptive Material and Practical Application
Computer-data related products such as software, data structures and collections of data are also evaluated for a practical application.
Computer-data related products are classified into one of two groups, either
1. functional descriptive material,
2. or non-functional descriptive material.
Functional Descriptive Material
* “Functional descriptive material" includes data structures and computer programs which impart functionality when employed as a computer component.
* The definition of "data structure" is "a physical or logical relationship among data elements, designed to support specific data manipulation functions."
o See The New IEEE Standard Dictionary of Electrical and Electronics Terms 308 (5th ed. 1993).
Functional descriptive material includes data structures and computer programs which impart functionality when employed as a computer component.
Computer programs may be explicitly claimed as, for example, a series of code or instructions for performing functions or may be implicitly claimed as, for example, a system or a tool or a logic or a module. Where there is no evidence in the specification that a term or phrase which may be interpreted as software, hardware or combinations thereof necessarily includes hardware, it should be interpreted in its broadest reasonable sense as software.
The definition of “data structure” from the 5th edition of the IEEE Standard Dictionary of Electrical and Electronics terms is “a physical or logical relationship among data elements, designed to support specific data manipulation functions.”
Note that mere use of the term “data structure” does not mean a data structure is being claimed. The elements of the data structure must be evaluated to determine if, when taken as a whole, they constitute a data structure in accordance with the IEEE definition (may be statutory) or are a mere compilation of data (non-statutory).
* Functional Descriptive material per se is not statutory.
o Cf. In re Warmerdam, disembodied data structure claim.
* Functional Descriptive material in combination with an appropriate computer readable medium must be capable of producing a useful, concrete and tangible result when used in a computer system.
o Cf. In re Warmerdam – data structure stored in a computer memory, and In re Lowry, 32 USPQ2d 1031 (Fed. Cir. 1994) – data structure in a “computer readable medium”.
o The “computer readable medium” must be physical structure, not a signal, which permits the functionality to be realized with the computer.
Functional descriptive material, per se, is not statutory. This is exemplified in In re Warmerdam 31 USPQ2d 1754 where the rejection of a claim to a disembodied data structure was affirmed. Thus a claim to a data structure, per se, or other functional descriptive material, including computer programs, per se, is not patent eligible subject matter.
Functional descriptive material claimed in combination with an appropriate computer readable medium to enable the functionality to be realized is patent eligible subject matter if it is capable of producing a useful, concrete and tangible result when used in the computer system. Compare Warmerdam to In re Lowry 32 USPQ2d 1031 where a memory with a data structure that increased computing efficiency was patentable.
The computer readable medium must be physical structure which provides the functional descriptive material in usable form to permit the functionality to be realized with the computer. A program product which does not explicitly include such a medium, a program per se, a signal or other type of transmission media that fails to include the hardware necessary to realize the functionality (e.g., a transmitter or a receiver), and a piece of paper with the functional descriptive material written on it are all examples of media which are not believed to enable the functionality to be realized with the computer.
Non-Functional Descriptive Material
* Non-functional descriptive material per se is an abstract idea, and therefore is not statutory.
* Non-Functional Descriptive Material is not statutory even if in combination with a physical medium.
o No useful, concrete or tangible result is produced since there is no functionality.
Examples of Non-Functional Descriptive Material
* Music
* Literature
* Art
* Photographs
* Data formats, frames or packets
* Data base per se
* Mere arrangements of facts or compilations of data
* Share price on a disk
Even when non-functional descriptive material is stored to be read or outputted by a computer without any functional interrelationship, they do not impart functionality to the computer, i.e., they are not computer components.
This last example is a reference to the State Street decision. While the CAFC determined that a claim to an apparatus that produced a share price and allocated funds in accordance therewith produces a useful, concrete and tangible result, a claim just to the result itself in this case is non-functional descriptive material.
These examples are merely stored to be read or outputted by a computer without any functional interrelationship with the computer, and thus they do not impart any functionality to the computer. That is, they are not computer components. Again, consider In re Lowry, the data structure functioned as a computer component and increased computing efficiency.
Practical Application
* A claim to a proper computer readable medium (not e.g. a signal) encoded with functional descriptive material that can function with a computer to effect a useful, concrete and tangible result (e.g. running an assembly line or executing a stock transaction) satisfies the practical application test.
Another example of a practical application within the context of computer related inventions is a claim to a computer program on a computer readable medium where the program when executed causes the computer to produce a useful, concrete and tangible result. Please take note that it is possible for a computer program on a computer readable medium to not include a practical application and thus be non-statutory. For example, a computer program on the requisite computer readable medium which merely sets forth generic instructions for solving the mathematical equation e=mc2 does not satisfy the practical application test. On the other hand, a claim to an algorithm that imparts increased efficiency to a computer in computing a particular equation may satisfy such a test. Therefore, a claim to a proper computer readable medium (not e.g. a signal or program listing on paper) encoded with functional descriptive material that can function with a computer to effect a useful, concrete and tangible result (e.g. running an assembly line or executing a stock transaction) satisfies the practical application test. Note that the specification may provide evidence as to what Applicant intends to be included within the metes and bounds of the claimed medium. If there is evidence the medium is intended to cover embodiments which are non-statutory, i.e., the medium is not limited to those media which fall within a statutory category of invention and enable the functionality of what’s stored thereon to be realized, the claim must be so rejected. At this time, if Applicant provides no evidence of intent, the reasonable interpretation of computer or machine readable medium conveyed to one of ordinary skill is appropriate tangible physical articles or objects.
If Yes, Don’t Stop
Finding a practical application does not end the analysis under 101.
4) Preemption
* A claim may not preempt abstract ideas, laws of nature or natural phenomena.
* Further, a claim may not preempt every “substantial practical application” of an abstract idea, law of nature or natural phenomena because it would in practical effect be a patent on the judicial exceptions themselves.
Does the claimed invention wholly preempt a judicial exception?
Even if the claimed invention recites a seemingly practical application of a judicial exception (for instance an abstract idea or mathematical formula), the examiner must ensure that the claim does not in reality seek patent protection for every substantial practical application of the claimed judicial exception. A claim may not preempt abstract ideas, laws of nature or natural phenomena.
Therefore, a claim may not preempt every “substantial practical application” of an abstract idea, law of nature or natural phenomena because it would in practical effect be a patent on the judicial exceptions itself.
* Thus, even though a practical application is found in the claim, we must determine if every “substantial practical application” is being claimed.
* If every substantial practical application is being claimed, the claim is non-statutory under 101.
Thus, even though a practical application is found in the claim, we must determine if every “substantial practical application” is being claimed. Here is an example of a claim which preempts an abstract idea. A computer comprising: memory; and a processor, where the processor is programmed to perform mathematical algorithm AxBxCxD, where A, B, C and D are real numbers. In this case, even though the claim recites a seemingly statutory apparatus (that is a computer with memory and a processor), the claim in reality provides patent protection for every substantial practical application of the mathematical algorithm itself.
Interim Guidelines
* Purpose: To assist examiners in determining whether a claim is directed to statutory subject matter under 35 U.S.C. § 101.
* Published in the O.G. 11/22/2005
* Period for public commentary runs until June 30, 2006.
* Submit comments via email addressed to: AB98.Comments@uspto.gov
Additional submission information found in the Federal Register Vol. 70, No. 243, 75451-75452 (Tues, Dec. 20, 2005)
The Interim Guidelines, hereinafter “Guidelines,” are intended to assist examiners in determining whether a claim is directed to statutory subject matter under 35 USC 101. They were posted on the USPTO web site on October 26, 2005, and published in the Official Gazette on November 22, 2005. These Guidelines are based on the USPTO’s current understanding of the law and are believed to be fully consistent with binding precedent of the Supreme Court, the Federal Circuit and the Federal Circuit’s predecessor courts.
These Guidelines do not constitute substantive rulemaking and hence do not have the force and effect of law. The Guidelines set forth the procedures USPTO personnel will follow when examining applications. USPTO personnel are to rely on these Guidelines in the event of any inconsistent treatment of issues between these Guidelines and any earlier provided guidance, including existing MPEP 2106, from the USPTO.
The Guidelines are not meant to be all encompassing for every possible scenario that may occur. Instead, they are intended to provide the rationale examiners and other USPTO personnel should follow to determine whether statutory subject matter is being claimed on a case-by-case basis.
Interim Guidelines Intro
What’s In:
* Statutory Categories
* Judicial Exceptions
* Practical Application
* Preemption
There were numerous tests being applied by examiners to determine whether patent eligible subject matter was being claimed. The Guidelines clarify the analysis to be applied and illustrate the prior tests not to be applied.
The statutory categories of invention. USPTO personnel must first identify whether the claim falls within one of the four enumerated categories of patentable subject matter recited in section 101 (process, machine, manufacture or composition of matter);
Judicial Exceptions. Claims directed to nothing more than abstract ideas (such as mathematical algorithms), natural phenomena, and laws of nature are not eligible and therefore are excluded from patent protection.
Practical Application. To be patent eligible, claims including limitation(s) that set forth subject matter excluded by a judicial exception must be for a practical application, e.g. of an abstract idea, law of nature, or natural phenomenon. A practical application results, for example, if the claimed invention “transforms” an article or physical object to a different state or thing; or if the claimed invention produces a useful, concrete and tangible result.
Preemption. Even when a claim applies an abstract idea as part of a seemingly patent eligible product or process, USPTO personnel must ensure that it does not in reality provide patent protection for every substantial practical application (including undisclosed applications) of the abstract idea. That would be, in effect, a patent on the abstract idea itself. Notice how this criterion meshes with 112, first paragraph.
What’s Out:
* “Not in the Technological Arts”
* Freeman-Walter-Abele
* Mental Steps or Human Steps
* Machine Implemented
* Data Transformation
The following tests previously applied by some examiners are not determinative of patent-eligible subject matter and should not be used as rationale for rejecting claims under 35 USC 101.
The “Not in the technological arts” criterion. USPTO personnel should no longer rely on the technological arts test to determine whether a claimed invention is directed to statutory subject matter. There are no other recognized exceptions to eligible subject matter other than laws of nature, natural phenomena, and abstract ideas.
Freeman-Walter-Abele. USPTO personnel should not rely on the Freeman-Walter-Abele test, i.e., “data gathering steps” or “insignificant post solution activity,” to determine whether a claimed invention is directed to statutory subject matter.
Mental steps or human steps. Even if all the steps of a claimed process can be carried out in the human mind, examiners must still determine whether the claimed process produces a useful, concrete, and tangible result, i.e., apply the practical application test set forth in State Street. The fact that some or all steps of a claimed process can be performed by a human is likewise not an appropriate rationale for rejection. To be patent-eligible, however, the steps must produce either a physical transformation or a useful, concrete and tangible result.
Machine implemented. Whether a claim recites a machine implemented process is not determinative of whether that process claim is statutory. Thus, a finding that a claim fails to recite a computer-implemented process is not determinative in whether that claim passes muster under § 101.
Data transformation. Identifying that a claim transforms data from one value to another is not by itself sufficient for determining whether the claim is eligible for patent protection.
Claims previously rejected under any of the above rationale are not necessarily patent-eligible (i.e., statutory). A rejection may still be reasonable under 101 after applying the appropriate tests set forth in the Interim Guidelines.
Prerequisites to Analysis Under 101
Determine what applicant invented
* Review the spec and claims.
* Identify and understand:
o Any utility and/or practical application asserted by applicant;
o The meaning of claim terms; and Claim scope.
Conduct a thorough search.
* What is known in the art can contribute to understanding the invention.
Prior to any analysis under §101, it is critical that the examiner determine what applicant invented and is seeking to patent. This starts by a review of the specification and the claims. From this, the examiner needs to identify and understand:
Any utility and/or practical application asserted by the applicant. The claimed invention as a whole must be useful and accomplish a practical application. The applicant is in the best position to explain why an invention is believed useful. Accordingly, a complete disclosure should contain some indication of the practical application for the claimed invention, i.e., why the applicant believes the claimed invention is useful. MPEP 2107 provides details for the analysis of utility, but can be summarized in that practical application must be specific, substantial and credible.
The meaning of claim terms. The claims define the property rights provided by a patent, and thus require careful scrutiny. USPTO personnel must always remember to use the perspective of one of ordinary skill in the art in determining the meaning of claim terms. Claims and disclosures are not to be evaluated in a vacuum. The goal of claim analysis is to identify the boundaries of the protection sought by the applicant and to understand how the claims relate to and define what the applicant has indicated is the invention. Only where an explicit definition is provided in the disclosure by the applicant for a term will that definition control interpretation of the term as it is used in the claim. The courts have indicated that such a definition constitutes an unambiguous surrender of subject matter outside such a definition.
Claim scope. The variance in claim scope among the claims must be ascertained. This often provides guidance as to applicant’s intent for what is to be included in the coverage of some claims with respect to others. Likewise, the specification may provide evidence of what Applicant intends to be included within the metes and bounds of particular terms used in the claims.
Conduct a thorough search. What is known in the art can contribute to understanding the invention. Because the perspective of one of ordinary skill in the art is used in the analysis, the result of such a search will contribute to USPTO personnel’s understanding of the invention.
Analysis Under 101
The prerequisites having been completed, now the analysis can begin. Analysis for determining patent eligible subject matter under §101 is a 4 step process:
1. Does the claimed invention fall within one of the four statutory categories?
2. Does the claimed invention fall within a judicial exception?
3. Does the claimed invention provide a practical application?
4. Does the claimed invention wholly preempt all substantial applications of a judicial exception?
All four steps must be applied to each and every claim to form a complete analysis.
1) Statutory Categories
What do we grant patents for?
* 35 U.S.C. §101 reads: “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 therefore, subject to the conditions and requirements of this title.”
First step, answer the question, “Does the claimed invention fall within one of the four categories of invention?”
Note that it does not matter which of the four statutory categories of invention as long as it falls within one of the four. The analysis is the same regardless to which category the claim is directed.
The statutory categories of invention are set forth in 35 USC 101, which reads, “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 therefore, subject to the conditions and requirements of this title.”
* A “machine”, “manufacture”, and “composition of matter” all define things or products.
* A “process” defines actions i.e. inventions that set forth a series of steps or acts to performed.
A “machine”, “manufacture”, and “composition of matter” all define things or products.
A “process” defines actions i.e. inventions that set forth a series of steps or acts to performed. This is often done in the form of method claims. This is not to be confused with a manufacture (e.g., memory, computer-readable medium) having instructions stored in or on it for causing steps to be performed when the instructions are executed. Such claims are directed to the manufacture. Likewise, a machine that is claimed in terms of statements of intended use or field of use, “adapted to/for” or “configured to/for” clauses, “wherein” clauses, or “whereby” clauses is a claim directed to the machine. If it appears the claim is directed to multiple statutory categories of invention, see the analysis in MPEP 2173.05(p).
Not in One of the Statutory Categories
Some examples of things that are not included in one of the statutory categories of invention are:
1. Literary works, per se, including story lines and movie plots.
2. Rules to play a game, per se.
3. Legal agreements, per se. For example, a claim to an insurance policy, as contrasted with the method of creating the characteristics of such a policy, would not be patent eligible subject matter.
4. Signals, per se. This includes signals carrying instructions or other functional descriptive material and is covered more thoroughly in Annex IV of the Guidelines.
5. A computer program, logic or language, per se.
These are only a few of the myriad of examples of subject matter which applicants have sought to patent but are not currently believed to be patent eligible subject matter under §101.
If Not, Don’t Stop
* If the examiner can establish that a claim does not fall into a statutory category, that does not preclude complete examination for all other conditions of patentability.
* The examiner must continue with the 101 analysis and must still examine the claims for compliance with 102, 103 and 112.
Even if the examiner can establish that a claim does not fall into a statutory category and sets forth a reasonable position in a rejection that the claims are non-statutory, that does not preclude complete examination for all other conditions of patentability. The examiner must continue with the §101 analysis, including that for double patenting, and do a complete analysis under §112. A search must be completed based on the claims as best understood, and any applicable prior art used to formulate rejections under §102 or §103. In short, don’t stop or short circuit the examination. Make sure to include all appropriate rejections and objections at the time of the first action on the merits.
2) Judicial Exceptions
Does the claimed invention fall within a judicial exception?
Despite the apparent sweeping breadth of 35 USC 101, and the often quoted “anything under the sun that is made by man.” statement made by the Supreme Court in Diamond v. Chakrabarty, 447 U.S. 303, 308-09, 206 USPQ 193, 197 (1980), the Supreme Court has identified three judicial exception categories of nonstatutory subject matter.
They are:
* Laws of nature, per se;
* Natural phenomena, per se; and
* Abstract ideas, per se.
Judicial Exception Examples
Examples of Judicial Exceptions are:
* Laws of nature
o e=mc2; f=ma
* Natural phenomena
o the heat of the sun; electricity; a new mineral; electromagnetism (Charles Morse)
* Abstract ideas
o mathematical algorithms; legal rights
While it’s not likely you would see a claim in the exact form listed in any of the above examples, it is quite possible that you may encounter a product claim with characteristics that are nothing more than a law of nature, a method claim which includes steps to an abstract idea, or a composition of matter claim which turns out to include a natural phenomena. Such claims are common and further analysis is required to determine if they are attempting to, per se, claim a judicial exception.
If Yes, Don’t Stop
* If a judicial exception is found in the claim, further analysis under 101 is required.
* If a judicial exception is not found in the claim, the claim must fall within a statutory category and meet the other conditions of 101.
Even if the examiner can establish that a judicial exception is found in the claim, further analysis is required to determine whether a practical application of the exception is being claimed and whether preemption applies. A complete examination for all other conditions of patentability must occur. The examiner must continue with the §101 analysis, including double patenting, and do a complete analysis under §112. A search must be completed based on the claims as best understood, and any applicable prior art used to formulate rejections under §102 or §103. In short, don’t stop the examination. The reason is easily seen – the subject matter rejection may be overcome by amendment, leaving the remaining issues on the table unless the examiner has raised them already.
If a judicial exception is not found in the claim, and the claim does fall within a statutory category, it is considered eligible for patenting but must still meet the other conditions of 101, e.g., utility.
3) Practical Application
* Two ways to provide a practical application of a judicial exception:
o Physical Transformation,
o OR Produce A Useful, Concrete, and Tangible Result
Does the claimed invention provide a practical application of a judicial exception?
As mentioned previously, even if the claim does not appear to fall within a statutory category of invention, the analysis under §101 must continue to determine if the claim recites a practical application. If not, that would be further rationale in support of the rejection. Likewise, even if a claim recites a judicial exception, the analysis must continue. The next step in the analysis is to determine if the claim recites a practical application of the exception or just the judicial exception. A claim directed to a practical application of the exception may be directed to patent eligible subject matter, while a claim directed to the exception itself is not. A claim is directed to a practical application when there is either a physical transformation or when a useful, concrete and tangible result is produced. An easily seen instance of such a result is a physical transformation performed by the process or machine claimed, so looking for a physical transformation as a result of the claimed subject matter is an efficient manner of passing this test.
Physical Transformation
* The claimed invention transforms an article or physical object to a different state or thing.
* If transformation is found, this ends the analysis for statutory subject matter.
* Transformation of data is not “physical transformation,” nor are physical acts necessarily a “physical transformation.”
* Example: manufacturing a tire by curing rubber.
Physical transformation occurs when the claimed invention transforms an article or physical object to a different structural state or thing. Physical transformation is an indication that the claim is statutory because such a transformation itself is a useful, tangible and concrete result. However, data transformation is not a physical transformation. Data, by definition, is intangible, so the claim must go further to have a tangible result. Thus, manipulation of data in a computer is not, in and of itself, sufficient for establishing that a claim is statutory. Likewise, a physical act is not necessarily a physical transformation. A physical act may, however, provide a useful, concrete and tangible result to establish patent-eligible subject matter. An example of physical transformation rendering a practical application of a judicial exception statutory is a claim to manufacturing a tire by curing rubber, where the curing time is calculated according to a mathematical equation.
* Even if a judicial exception is a limitation of the claimed invention, e.g. a law of nature, if it is applied in the physical transformation, a practical application is provided.
* The claims still need to be checked for utility under 101 however.
Inclusion of a judicial exception as a limitation of a claimed invention does not preclude the claim from being statutory where the claim as a whole is directed to a practical application because a physical transformation has taken place. However, the claim still needs to be checked to determine if it meets the utility requirement under 35 USC 101. For example, claims directed to production of excess energy or perpetual motion may arguably involve a physical transformation, yet they would raise the issue of lacking utility and/or inoperative to be addressed under 101.
Useful, Concrete, Tangible
* If no physical transformation appears in the claim, check for a “useful, concrete and tangible result”.
* The focus is on the result, not the steps or structure used to produce the result.
* A useful, concrete and tangible result must be either specifically recited in the claim or flow inherently therefrom.
If no physical transformation appears in the claim then the next step in the analysis is to determine if the claim is otherwise directed to a useful, concrete and tangible result. The focus is on the result of the claim as a whole, not the individual steps or structure used to produce the result.
A useful, concrete and tangible result must be either specifically recited in the claim or flow inherently therefrom. To flow inherently therefrom, it must occur. If there is a reasonable exception or it is merely likely that it would occur, it does not “flow inherently therefrom” and the claim would need to be amended to specifically recite the result.
* Even if a judicial exception is a limitation of the claimed invention, e.g. a law of nature, if it is applied to produce a useful, concrete and tangible result, a practical application is provided.
Inclusion of a judicial exception as a limitation of a claimed invention does not preclude the claim from being statutory where the claim as a whole is directed to a practical application because a useful, concrete and tangible result has taken place. However, the claim still needs to be checked to determine if it meets the utility requirement under 35 USC 101.
“Useful”
* The claimed invention as a whole must satisfy the utility requirement of 101:
o specific,
o substantial, and
o credible utility.
* These criteria require evaluation of the specification and the knowledge in the art.
When no physical transformation is found, the first factor of the second test for practical application is a determination of whether the claimed invention produces a useful result. For an invention to be “useful” it must satisfy the utility requirement of section 101. The USPTO’s official interpretation of the utility requirement provides that the utility of a claimed invention has to be (i) specific, (ii) substantial and (iii) credible. See MPEP 2107 for further guidance on these 3 points.
Determining whether the claimed invention is specific, substantial and credible also requires evaluation of the specification and knowledge in the art, hence the need for the prerequisites of determining what applicant invented and conducting a thorough search prior to analysis under 101.
The disclosure may have met the requirements for utility, but what’s claimed does not produce a result that reflects it or is too preliminary in and of itself to be a useful result. In these instances, the claimed invention may not provide a useful result even though an appropriate utility has been disclosed, and a rejection as non-statutory would be appropriate.
* A complete disclosure should contain some indication of why the claimed invention is useful.
* If the claimed invention does not fulfill any of the disclosed utilities, determine if the utility would have been recognized by those in the art.
When checking the disclosure to determine what applicant invented, a complete disclosure should contain some indication of why the claimed invention is useful.
If the specification discloses a practical application of a 101 judicial exception, but the claim is broader than the disclosure such that it does not require a practical application, then the claim must be rejected.
If the claimed invention does not produce a useful result, i.e. fulfill any of the disclosed utilities, determine if any utility of the claimed result would have been recognized by those in the art as being specific, substantial and credible. If no utility for the result would have been recognized, then the claim must be rejected as non-statutory for failing to comply with 35 USC 101, i.e., not providing a useful, concrete and tangible result.
“Concrete”
* Usually, a claimed invention is not concrete when a result cannot be assured or is not reproducible.
* Concrete is not a requirement that the result must be 100% accurate (e.g., a claim directed to estimating, predicting or approximating something does not necessarily lack concreteness)
* May require a determination of the level of ordinary skill in the art.
The second factor in this test for practical application is a determination of whether the claimed invention produces a concrete result.
Usually, this question arises when a result cannot be assured. In other words, the process must have a result that can be substantially repeated. Note that the focus is on the result, not the steps themselves. For example, concrete data processing steps could still produce an unrepeatable result if the data being processed is subjective. However, the mere fact that the result is an estimate, prediction or other approximation that may not ultimately be found to be accurate is not a determinative factor for concreteness. Thus, an assured result refers to repeatability and ability to achieve a result rather than ultimate accuracy of the result.
As with the useful test, the prerequisites of determining what applicant invented and conducting a thorough search prior to analysis under 101 are needed in order to ascertain whether a particular result can be assured.
Enablement
* In instances where the invention cannot be used as intended without undue experimentation, an appropriate rejection of the claim as being nonstatutory under 35 U.S.C. 101 should be accompanied by a lack of enablement rejection under 35 U.S.C. 112 first paragraph.
When a rejection under §101 is made for lacking concreteness and the invention cannot operate as intended without undue experimentation because of the lack of repeatability or predictability, the §101 rejection should be accompanied by a lack of enablement rejection under 35 U.S.C. § 112, first paragraph.
Note that contrary to rejections made for lack of utility or inoperativeness under §101 which are always accompanied by a §112, first paragraph, rejection, the only time a §112, first paragraph rejection necessarily accompanies a §101 non-statutory rejection is when the issue is a lack of concreteness.
“Tangible”
* “Real world” result.
* Not necessarily tied to a machine; not a duplicate of “physical transformation”.
* In other words, the opposite of “tangible” is “abstract”.
* Thoughts are not “real world” results.
* Example: Calculating a price of an item to sell and then conveying the calculated price to a potential customer
The third and final factor in this test for practical application is a determination of whether the claimed invention produces a tangible result. The tangible requirement does not necessarily mean that a claim must either be tied to a particular machine or apparatus, or must operate to change articles or materials to a different state or thing. To be tangible the claim must recite more than a § 101 judicial exception, in that the process claim must set forth a practical application of that § 101 judicial exception to produce a real-world result.
If the result is merely a thought, this is not a tangible or real-world result. For example, merely determining or calculating a price may not be held to be a tangible result, instead reasonably being interpreted as just a thought or a computation within a processor; however, calculating a price of an item to sell and then conveying the calculated price to a potential customer would be a tangible result.
Descriptive Material and Practical Application
Computer-data related products such as software, data structures and collections of data are also evaluated for a practical application.
Computer-data related products are classified into one of two groups, either
1. functional descriptive material,
2. or non-functional descriptive material.
Functional Descriptive Material
* “Functional descriptive material" includes data structures and computer programs which impart functionality when employed as a computer component.
* The definition of "data structure" is "a physical or logical relationship among data elements, designed to support specific data manipulation functions."
o See The New IEEE Standard Dictionary of Electrical and Electronics Terms 308 (5th ed. 1993).
Functional descriptive material includes data structures and computer programs which impart functionality when employed as a computer component.
Computer programs may be explicitly claimed as, for example, a series of code or instructions for performing functions or may be implicitly claimed as, for example, a system or a tool or a logic or a module. Where there is no evidence in the specification that a term or phrase which may be interpreted as software, hardware or combinations thereof necessarily includes hardware, it should be interpreted in its broadest reasonable sense as software.
The definition of “data structure” from the 5th edition of the IEEE Standard Dictionary of Electrical and Electronics terms is “a physical or logical relationship among data elements, designed to support specific data manipulation functions.”
Note that mere use of the term “data structure” does not mean a data structure is being claimed. The elements of the data structure must be evaluated to determine if, when taken as a whole, they constitute a data structure in accordance with the IEEE definition (may be statutory) or are a mere compilation of data (non-statutory).
* Functional Descriptive material per se is not statutory.
o Cf. In re Warmerdam, disembodied data structure claim.
* Functional Descriptive material in combination with an appropriate computer readable medium must be capable of producing a useful, concrete and tangible result when used in a computer system.
o Cf. In re Warmerdam – data structure stored in a computer memory, and In re Lowry, 32 USPQ2d 1031 (Fed. Cir. 1994) – data structure in a “computer readable medium”.
o The “computer readable medium” must be physical structure, not a signal, which permits the functionality to be realized with the computer.
Functional descriptive material, per se, is not statutory. This is exemplified in In re Warmerdam 31 USPQ2d 1754 where the rejection of a claim to a disembodied data structure was affirmed. Thus a claim to a data structure, per se, or other functional descriptive material, including computer programs, per se, is not patent eligible subject matter.
Functional descriptive material claimed in combination with an appropriate computer readable medium to enable the functionality to be realized is patent eligible subject matter if it is capable of producing a useful, concrete and tangible result when used in the computer system. Compare Warmerdam to In re Lowry 32 USPQ2d 1031 where a memory with a data structure that increased computing efficiency was patentable.
The computer readable medium must be physical structure which provides the functional descriptive material in usable form to permit the functionality to be realized with the computer. A program product which does not explicitly include such a medium, a program per se, a signal or other type of transmission media that fails to include the hardware necessary to realize the functionality (e.g., a transmitter or a receiver), and a piece of paper with the functional descriptive material written on it are all examples of media which are not believed to enable the functionality to be realized with the computer.
Non-Functional Descriptive Material
* Non-functional descriptive material per se is an abstract idea, and therefore is not statutory.
* Non-Functional Descriptive Material is not statutory even if in combination with a physical medium.
o No useful, concrete or tangible result is produced since there is no functionality.
Examples of Non-Functional Descriptive Material
* Music
* Literature
* Art
* Photographs
* Data formats, frames or packets
* Data base per se
* Mere arrangements of facts or compilations of data
* Share price on a disk
Even when non-functional descriptive material is stored to be read or outputted by a computer without any functional interrelationship, they do not impart functionality to the computer, i.e., they are not computer components.
This last example is a reference to the State Street decision. While the CAFC determined that a claim to an apparatus that produced a share price and allocated funds in accordance therewith produces a useful, concrete and tangible result, a claim just to the result itself in this case is non-functional descriptive material.
These examples are merely stored to be read or outputted by a computer without any functional interrelationship with the computer, and thus they do not impart any functionality to the computer. That is, they are not computer components. Again, consider In re Lowry, the data structure functioned as a computer component and increased computing efficiency.
Practical Application
* A claim to a proper computer readable medium (not e.g. a signal) encoded with functional descriptive material that can function with a computer to effect a useful, concrete and tangible result (e.g. running an assembly line or executing a stock transaction) satisfies the practical application test.
Another example of a practical application within the context of computer related inventions is a claim to a computer program on a computer readable medium where the program when executed causes the computer to produce a useful, concrete and tangible result. Please take note that it is possible for a computer program on a computer readable medium to not include a practical application and thus be non-statutory. For example, a computer program on the requisite computer readable medium which merely sets forth generic instructions for solving the mathematical equation e=mc2 does not satisfy the practical application test. On the other hand, a claim to an algorithm that imparts increased efficiency to a computer in computing a particular equation may satisfy such a test. Therefore, a claim to a proper computer readable medium (not e.g. a signal or program listing on paper) encoded with functional descriptive material that can function with a computer to effect a useful, concrete and tangible result (e.g. running an assembly line or executing a stock transaction) satisfies the practical application test. Note that the specification may provide evidence as to what Applicant intends to be included within the metes and bounds of the claimed medium. If there is evidence the medium is intended to cover embodiments which are non-statutory, i.e., the medium is not limited to those media which fall within a statutory category of invention and enable the functionality of what’s stored thereon to be realized, the claim must be so rejected. At this time, if Applicant provides no evidence of intent, the reasonable interpretation of computer or machine readable medium conveyed to one of ordinary skill is appropriate tangible physical articles or objects.
If Yes, Don’t Stop
Finding a practical application does not end the analysis under 101.
4) Preemption
* A claim may not preempt abstract ideas, laws of nature or natural phenomena.
* Further, a claim may not preempt every “substantial practical application” of an abstract idea, law of nature or natural phenomena because it would in practical effect be a patent on the judicial exceptions themselves.
Does the claimed invention wholly preempt a judicial exception?
Even if the claimed invention recites a seemingly practical application of a judicial exception (for instance an abstract idea or mathematical formula), the examiner must ensure that the claim does not in reality seek patent protection for every substantial practical application of the claimed judicial exception. A claim may not preempt abstract ideas, laws of nature or natural phenomena.
Therefore, a claim may not preempt every “substantial practical application” of an abstract idea, law of nature or natural phenomena because it would in practical effect be a patent on the judicial exceptions itself.
* Thus, even though a practical application is found in the claim, we must determine if every “substantial practical application” is being claimed.
* If every substantial practical application is being claimed, the claim is non-statutory under 101.
Thus, even though a practical application is found in the claim, we must determine if every “substantial practical application” is being claimed. Here is an example of a claim which preempts an abstract idea. A computer comprising: memory; and a processor, where the processor is programmed to perform mathematical algorithm AxBxCxD, where A, B, C and D are real numbers. In this case, even though the claim recites a seemingly statutory apparatus (that is a computer with memory and a processor), the claim in reality provides patent protection for every substantial practical application of the mathematical algorithm itself.
20 February 2007
NTP v. RIM, 2005
Though not a typical software case, this case is significant because there have been calls for "patent reform" to reduce the impact of so-called "patent trolls" in view of this case. There were allegations of impropriety and lobbying which will be discussed later. A number of members of Congress use Research-In-Motion's Blackberry devices and were concerned that an injunction could disrupt use of their devices.
The patents involved included U.S. Patent Nos. 6,317,592; 6,272,190; 6,198,783; 6,067,451; 5,819,172; 5,751,773; 5,745,532; 5,631,946; 5,625,670; and 5,438,611.
The technology at issue related to systems for integrating existing electronic mail systems (“wireline” systems) with radio frequency (“RF”) wireless communication networks, to enable a mobile user to receive email over a wireless network. RIM's system utilized the following components: (1) the BlackBerry handheld unit (also referred to as the “BlackBerry Pager”); (2) email redirector software (such as the BlackBerry Enterprise Server (“BES”), the Desktop Redirector, or the Internet redirector); and (3) access to a nationwide wireless network (such as Mobitex, DataTAC, or GPRS).
As RIM is in Canada, certain steps of the alleged infringing activity occurred in Canada. RIM tried to argue that it could therefore not infringe a U.S. patent. The relevant statute is 35 U.S.C. 271.
NTP originally filed suit against RIM in the U.S. District Court for the Eastern District of Virginia. NTP alleged that over forty system and method claims from its several patents-in-suit had been infringed by various configurations of the BlackBerry system.
In an Order dated August 14, 2002, the district court listed the claim terms in contention and their corresponding constructions without additional reasoning or analysis. A series of summary judgment motions followed the court’s Markman decision. Setting forth several alternate theories, RIM asked for summary judgment of both non-infringement and invalidity. RIM argued (1) that the asserted claims, properly construed, did not read on the accused RIM systems, and (2) that the physical location of the “Relay” component of the BlackBerry system put RIM’s allegedly infringing conduct outside the reach of 35 U.S.C. § 271. The district court denied all of RIM’s summary judgment motions.
NTP asked the district court to grant partial summary judgment of infringement on four claims of the patents-in-suit. The district court agreed with NTP, holding that “no genuine issue of material fact” existed as to infringement of the four claims. Accordingly, the district court granted summary judgment, except as to the issue of infringement of certain claims by the BlackBerry series 5810 handheld device. That issue was reserved for the jury.
The case proceeded to trial on fourteen claims. A verdict was rendered on November 21, 2002. On every issue presented, the jury found in favor of the plaintiff, NTP. The jury found direct, induced, and contributory infringement by RIM on all asserted claims of the patents-in-suit. The jury also found that the infringement was willful. It rejected every defense proposed by RIM. Adopting a reasonable royalty rate of 5.7%, the jury awarded damages to NTP in the amount of approximately $23 million.
Following the jury verdict, RIM moved the court for JMOL or, in the alternative, for a new trial. The court denied these motions. On August 5, 2003, the district court entered final judgment in favor of NTP. The court awarded monetary damages totaling $53,704,322.69 The court also entered a permanent injunction against RIM enjoining it from further manufacture, use, importation, and/or sale of all accused BlackBerry systems, software, and handhelds. The injunction was stayed pending appeal.
The Federal Circuit stated that use of a claimed system under section 271(a) is the place at which the system as a whole is put into service, i.e., the place where control of the system is exercised and beneficial use of the system obtained. Based on this interpretation of section 271(a), it was proper for the jury to have found that use of NTP’s asserted system claims occurred within the United States. RIM’s customers located within the United States controlled the transmission of the originated information and also benefited from such an exchange of information. Thus, the location of the Relay in Canada did not, as a matter of law, preclude infringement of the asserted system claims in this case.
The Federal Circuit reached a different conclusion as to NTP’s asserted method claims. Under section 271(a), the concept of “use” of a patented method or process is fundamentally different from the use of a patented system or device. Because a process is nothing more than the sequence of actions of which it is comprised, the use of a process necessarily involves doing or performing each of the steps recited. This is unlike use of a system as a whole, in which the components are used collectively, not individually. The Federal Circuit then held that a process cannot be used “within” the United States as required by section 271(a) unless each of the steps is performed within this country. Asserted method claims of NTP's patents recited a step that utilizes an “interface” or “interface switch,” which is only satisfied by the use of RIM’s Relay located in Canada. Therefore, as a matter of law, these claimed methods could not be infringed by use of RIM’s system.
Thus, RIM was able to avoid the method claims of NTP's patent, but not the apparatus claims.
RIM requested rehearing and Microsoft and the Government of Canada filed Amicus briefs supporting RIM. The Government of Canada argued that the holding in RIM upset the business and legal climate in Canada.
During the course of the litigation, RIM requested reexamination of the patents in 2002-2005. The Patent Office began reexamining the NTP patents. The cases were granted special status and reexamination proceeded far more rapidly than normal. In November 30, 2005, The U.S. Patent and Trademark Office informed both NTP & RIM that a reexamination final rejection of NTP's patents was pending. NTP accused PTO officials of holding improper covert meetings with RIM officials, including RIM’s CEO and Canadian counsel. After an ex parte reexamination is started, no participation of third parties is permitted. One NTP patent was given a 121 page rejection 5 days after receipt of incoming papers. RIM is alleged to have also lobbied Capitol Hill and engaged in a PR campaign claiming to be the victim of a "patent troll."
In November, 2005, the Department of Justice filed a brief requesting that RIM's service continue in view of the large number of users in the U.S. Federal Government.
On January 27, 2006, RIM and NTP filed briefs on the injunction issue. RIM argued that there was an exceptional public interest in continued and uninterrupted availability of RIM’s BlackBerry system and argued the fact that NTP can be more than adequately compensated by royalty payments.
In March 2006, RIM paid NTP $612.5 million in full and final settlement of all claims against RIM, as well as for a perpetual, fully-paid up license going forward.
The patents involved included U.S. Patent Nos. 6,317,592; 6,272,190; 6,198,783; 6,067,451; 5,819,172; 5,751,773; 5,745,532; 5,631,946; 5,625,670; and 5,438,611.
The technology at issue related to systems for integrating existing electronic mail systems (“wireline” systems) with radio frequency (“RF”) wireless communication networks, to enable a mobile user to receive email over a wireless network. RIM's system utilized the following components: (1) the BlackBerry handheld unit (also referred to as the “BlackBerry Pager”); (2) email redirector software (such as the BlackBerry Enterprise Server (“BES”), the Desktop Redirector, or the Internet redirector); and (3) access to a nationwide wireless network (such as Mobitex, DataTAC, or GPRS).
As RIM is in Canada, certain steps of the alleged infringing activity occurred in Canada. RIM tried to argue that it could therefore not infringe a U.S. patent. The relevant statute is 35 U.S.C. 271.
NTP originally filed suit against RIM in the U.S. District Court for the Eastern District of Virginia. NTP alleged that over forty system and method claims from its several patents-in-suit had been infringed by various configurations of the BlackBerry system.
In an Order dated August 14, 2002, the district court listed the claim terms in contention and their corresponding constructions without additional reasoning or analysis. A series of summary judgment motions followed the court’s Markman decision. Setting forth several alternate theories, RIM asked for summary judgment of both non-infringement and invalidity. RIM argued (1) that the asserted claims, properly construed, did not read on the accused RIM systems, and (2) that the physical location of the “Relay” component of the BlackBerry system put RIM’s allegedly infringing conduct outside the reach of 35 U.S.C. § 271. The district court denied all of RIM’s summary judgment motions.
NTP asked the district court to grant partial summary judgment of infringement on four claims of the patents-in-suit. The district court agreed with NTP, holding that “no genuine issue of material fact” existed as to infringement of the four claims. Accordingly, the district court granted summary judgment, except as to the issue of infringement of certain claims by the BlackBerry series 5810 handheld device. That issue was reserved for the jury.
The case proceeded to trial on fourteen claims. A verdict was rendered on November 21, 2002. On every issue presented, the jury found in favor of the plaintiff, NTP. The jury found direct, induced, and contributory infringement by RIM on all asserted claims of the patents-in-suit. The jury also found that the infringement was willful. It rejected every defense proposed by RIM. Adopting a reasonable royalty rate of 5.7%, the jury awarded damages to NTP in the amount of approximately $23 million.
Following the jury verdict, RIM moved the court for JMOL or, in the alternative, for a new trial. The court denied these motions. On August 5, 2003, the district court entered final judgment in favor of NTP. The court awarded monetary damages totaling $53,704,322.69 The court also entered a permanent injunction against RIM enjoining it from further manufacture, use, importation, and/or sale of all accused BlackBerry systems, software, and handhelds. The injunction was stayed pending appeal.
The Federal Circuit stated that use of a claimed system under section 271(a) is the place at which the system as a whole is put into service, i.e., the place where control of the system is exercised and beneficial use of the system obtained. Based on this interpretation of section 271(a), it was proper for the jury to have found that use of NTP’s asserted system claims occurred within the United States. RIM’s customers located within the United States controlled the transmission of the originated information and also benefited from such an exchange of information. Thus, the location of the Relay in Canada did not, as a matter of law, preclude infringement of the asserted system claims in this case.
The Federal Circuit reached a different conclusion as to NTP’s asserted method claims. Under section 271(a), the concept of “use” of a patented method or process is fundamentally different from the use of a patented system or device. Because a process is nothing more than the sequence of actions of which it is comprised, the use of a process necessarily involves doing or performing each of the steps recited. This is unlike use of a system as a whole, in which the components are used collectively, not individually. The Federal Circuit then held that a process cannot be used “within” the United States as required by section 271(a) unless each of the steps is performed within this country. Asserted method claims of NTP's patents recited a step that utilizes an “interface” or “interface switch,” which is only satisfied by the use of RIM’s Relay located in Canada. Therefore, as a matter of law, these claimed methods could not be infringed by use of RIM’s system.
Thus, RIM was able to avoid the method claims of NTP's patent, but not the apparatus claims.
RIM requested rehearing and Microsoft and the Government of Canada filed Amicus briefs supporting RIM. The Government of Canada argued that the holding in RIM upset the business and legal climate in Canada.
During the course of the litigation, RIM requested reexamination of the patents in 2002-2005. The Patent Office began reexamining the NTP patents. The cases were granted special status and reexamination proceeded far more rapidly than normal. In November 30, 2005, The U.S. Patent and Trademark Office informed both NTP & RIM that a reexamination final rejection of NTP's patents was pending. NTP accused PTO officials of holding improper covert meetings with RIM officials, including RIM’s CEO and Canadian counsel. After an ex parte reexamination is started, no participation of third parties is permitted. One NTP patent was given a 121 page rejection 5 days after receipt of incoming papers. RIM is alleged to have also lobbied Capitol Hill and engaged in a PR campaign claiming to be the victim of a "patent troll."
In November, 2005, the Department of Justice filed a brief requesting that RIM's service continue in view of the large number of users in the U.S. Federal Government.
On January 27, 2006, RIM and NTP filed briefs on the injunction issue. RIM argued that there was an exceptional public interest in continued and uninterrupted availability of RIM’s BlackBerry system and argued the fact that NTP can be more than adequately compensated by royalty payments.
In March 2006, RIM paid NTP $612.5 million in full and final settlement of all claims against RIM, as well as for a perpetual, fully-paid up license going forward.
Ex Parte Lundgren, 2004
Lundgren's invention related to the economic field of industrial organization and more particularly to the reduction of incentives for industrial collusion by making managerial compensation depend on relative profits rather than absolute profits. If managerial compensation depends only on the profits made by the manager's own firm, firm managers will attempt to maximize absolute profits. If managerial compensation depends on the profits made by the manager's own firm relative to the profits made by rival firms, then firm managers will attempt to maximize relative profits. If it is the goal of each firm to maximize relative profits, it is not possible for a group of firms to collude so as to increase the profits of all firms in the group. This eliminates incentives for industry-wide collusion.
Claim 1 was representative:
1. A method of compensating a manager who exercises administrative control over operations of a privately owned primary firm for the purpose of reducing the degree to which prices exceed marginal costs in an industry, reducing incentives for industry collusion between the primary firm and a set of comparison firms in said industry, or reducing incentives for coordinated special interest industry lobbying, said set of comparison firms including at least one firm, said primary firm having the manager who exercises administrative control over said primary firm's operations during a sampling period, wherein privately owned means not wholly government owned, the method comprising the steps of:
a) choosing an absolute performance standard from a set of absolute performance standards;
b) measuring an absolute performance of said primary firm with respect to said chosen absolute performance standard for said sampling period;
c) measuring an absolute performance of each firm of said set of comparison firms with respect to said chosen absolute performance standard for said sampling period, said measurement of performance for each firm of said set of comparison firms forming a set of comparison firm absolute performance measures;
d) determining a performance comparison base based on said set of comparison firm absolute performance measures by calculating a weighted average of said set of comparison firm absolute performance measures;
e) comparing said measurement of absolute performance of said primary firm with said performance comparison base;
f) determining a relative performance measure for said primary firm based on said comparison of said primary firm measurement of absolute performance and said performance comparison base;
g) determining the managerial compensation amount derived from said relative performance measure according to a monotonic managerial compensation amount transformation; and
h) transferring compensation to said manager, said transferred compensation having a value related to said managerial compensation amount.
The recited steps could be performed manually by a human.
The Examiner rejected the patent application as non-statutory under 35 U.S.C. section 101. On appeal, an appeal panel stated that they found that the claim language recited subject matter that is a practical application of shifting of physical assets to the manager. The remaining claims also recited the same practical application.
Dissatisfied with the outcome of that appeal, the Examining Corps filed a Request for Reconsideration and Rehearing listing two issues: 1. whether the invention as a whole was in the technological arts; and 2. assuming that the invention was in the technological arts, whether transferring compensation to a manager was a practical application. Lundgren filed a response to this Request. An expanded Board remanded to the Examiner so that the Examiner could consider Lundgren's response and because the Office of the Deputy Commissioner for Patent Examination Policy requested that the case be remanded to the examiner so that issues regarding "technological arts" and "practical application" could be further considered.
The Examiner maintained the rejection under 35 U.S.C. section 101. Lundgren filed a second appeal to the Board.
The Examiner withdrew an assertion that the claims failed to produce a "useful, concrete, and tangible result." However, the Examiner was of the opinion that there was a separate "technological arts" test for determining whether claims are directed to statutory subject matter in view of In re Musgrave, 431 F.2d 882 (CCPA 1970); In re Toma, 575 F.2d 872 (CCPA 1978); and Ex parte Bowman, 61 USPQ2d 1669 (Bd. Pat. App & Int. 2001)(non-precedential).
In Musgrave, the court reversed a rejection under 35 U.S.C. section 101 because it disagreed with the Board's opinion that the claims were directed to non-statutory processes because some or all of the steps could also be carried out in or with the aid of a human mind. The Musgrave court went on to observe that all that is necessary to make a sequence of operational steps a statutory 'process' within 35 U.S. section 101 is that it be in the technological arts so as to be in consonance with the Constitutional purpose to promote the progress of useful arts.
The Board stated that they did not view the court's statement in Musgrave to have created a separate "technological arts" test. The Board stated that Toma said as much. Toma court stated that cases such as Musgrave involved what was called at that time a "mental steps" rejection and that court observed "[t]he language which the examiner quoted was written in answer to 'mental steps" rejections and was not intended to create a generalized definition of statutory subject matter." Because Ex parte Bowman was non-precedential, the Board found that it was not binding. Finally, the Board noted that the Supreme Court was aware of a "technological arts test" and did not adopt it when it reversed the Court of Customs and Patent Appeals in Gottschalk v. Benson.
Thus, there is no "technological arts" test as far as the Board is concerned. This case could be helpful to attorneys prosecuting business method patent applications which don't utilize computers or technology.
Claim 1 was representative:
1. A method of compensating a manager who exercises administrative control over operations of a privately owned primary firm for the purpose of reducing the degree to which prices exceed marginal costs in an industry, reducing incentives for industry collusion between the primary firm and a set of comparison firms in said industry, or reducing incentives for coordinated special interest industry lobbying, said set of comparison firms including at least one firm, said primary firm having the manager who exercises administrative control over said primary firm's operations during a sampling period, wherein privately owned means not wholly government owned, the method comprising the steps of:
a) choosing an absolute performance standard from a set of absolute performance standards;
b) measuring an absolute performance of said primary firm with respect to said chosen absolute performance standard for said sampling period;
c) measuring an absolute performance of each firm of said set of comparison firms with respect to said chosen absolute performance standard for said sampling period, said measurement of performance for each firm of said set of comparison firms forming a set of comparison firm absolute performance measures;
d) determining a performance comparison base based on said set of comparison firm absolute performance measures by calculating a weighted average of said set of comparison firm absolute performance measures;
e) comparing said measurement of absolute performance of said primary firm with said performance comparison base;
f) determining a relative performance measure for said primary firm based on said comparison of said primary firm measurement of absolute performance and said performance comparison base;
g) determining the managerial compensation amount derived from said relative performance measure according to a monotonic managerial compensation amount transformation; and
h) transferring compensation to said manager, said transferred compensation having a value related to said managerial compensation amount.
The recited steps could be performed manually by a human.
The Examiner rejected the patent application as non-statutory under 35 U.S.C. section 101. On appeal, an appeal panel stated that they found that the claim language recited subject matter that is a practical application of shifting of physical assets to the manager. The remaining claims also recited the same practical application.
Dissatisfied with the outcome of that appeal, the Examining Corps filed a Request for Reconsideration and Rehearing listing two issues: 1. whether the invention as a whole was in the technological arts; and 2. assuming that the invention was in the technological arts, whether transferring compensation to a manager was a practical application. Lundgren filed a response to this Request. An expanded Board remanded to the Examiner so that the Examiner could consider Lundgren's response and because the Office of the Deputy Commissioner for Patent Examination Policy requested that the case be remanded to the examiner so that issues regarding "technological arts" and "practical application" could be further considered.
The Examiner maintained the rejection under 35 U.S.C. section 101. Lundgren filed a second appeal to the Board.
The Examiner withdrew an assertion that the claims failed to produce a "useful, concrete, and tangible result." However, the Examiner was of the opinion that there was a separate "technological arts" test for determining whether claims are directed to statutory subject matter in view of In re Musgrave, 431 F.2d 882 (CCPA 1970); In re Toma, 575 F.2d 872 (CCPA 1978); and Ex parte Bowman, 61 USPQ2d 1669 (Bd. Pat. App & Int. 2001)(non-precedential).
In Musgrave, the court reversed a rejection under 35 U.S.C. section 101 because it disagreed with the Board's opinion that the claims were directed to non-statutory processes because some or all of the steps could also be carried out in or with the aid of a human mind. The Musgrave court went on to observe that all that is necessary to make a sequence of operational steps a statutory 'process' within 35 U.S. section 101 is that it be in the technological arts so as to be in consonance with the Constitutional purpose to promote the progress of useful arts.
The Board stated that they did not view the court's statement in Musgrave to have created a separate "technological arts" test. The Board stated that Toma said as much. Toma court stated that cases such as Musgrave involved what was called at that time a "mental steps" rejection and that court observed "[t]he language which the examiner quoted was written in answer to 'mental steps" rejections and was not intended to create a generalized definition of statutory subject matter." Because Ex parte Bowman was non-precedential, the Board found that it was not binding. Finally, the Board noted that the Supreme Court was aware of a "technological arts test" and did not adopt it when it reversed the Court of Customs and Patent Appeals in Gottschalk v. Benson.
Thus, there is no "technological arts" test as far as the Board is concerned. This case could be helpful to attorneys prosecuting business method patent applications which don't utilize computers or technology.
19 February 2007
AT+T Corp. v. Excel Communication, 1999
This case blew the door wide open for business method patents.
U.S. Patent No. 5,333,184 describes a message record for long-distance telephone calls that is enhanced by adding a primary interexchange carrier ("PIC") indicator. The addition of the indicator aids long-distance carriers in providing differential billing treatment for subscribers, depending upon whether a subscriber calls someone with the same or a different long-distance carrier. AT+T's claimed process employed subscribers' and call recipients' PICs as data, applied Boolean algebra to those data to determine the value of the PIC indicator, and applied that value through switching and recording mechanisms to create a signal useful for billing purposes.
AT+T in 1996 asserted ten of the method claims against Excel in this infringement suit. The independent claims at issue (claims 1, 12, 18, and 40) included the step of "generating a message record for an interexchange call between an originating subscriber and a terminating subscriber," and the step of adding a PIC indicator to the message record. Independent claim 1, for example, adds a PIC indicator whose value depends upon the call recipient's PIC:
1. A method for use in a telecommunications system in which interexchange calls initiated by each subscriber are automatically routed over the facilities of a particular one of a plurality of interexchange carriers associated with that subscriber, said method comprising the steps of:
generating a message record for an interexchange call between an originating subscriber and a terminating subscriber, and
including, in said message record, a primary interexchange carrier (PIC) indicator having a value which is a function of whether or not the interexchange carrier associated with said terminating subscriber is a predetermined one of said interexchange carriers.
Independent claims 12 and 40 add a PIC indicator that shows if a recipient's PIC is the same as the IXC over which that particular call is being made. Independent claim 18 adds a PIC indicator designed to show if the caller and the recipient subscribe to the same IXC. The dependent claims at issue add the steps of accessing an IXC's subscriber database (claims 4, 13, and 19) and billing individual calls as a function of the value of the PIC indicator (claims 6, 15, and 21).
The district court concluded that the method claims of the patent implicitly recited a mathematical algorithm. The court was of the view that the only physical step in the claims involves data-gathering for the algorithm. Though the court recognized that the claims require the use of switches and computers, it nevertheless concluded that use of such facilities to perform a non-substantive change in the data's format could not serve to convert non-patentable subject matter into patentable subject matter. Thus the trial court, on summary judgment, held all of the method claims at issue invalid for failure to qualify as statutory subject matter.
The Federal Circuit stated that because 101 includes processes as a category of patentable subject matter, the judicially-defined proscription against patenting of a "mathematical algorithm," to the extent such a proscription still exists, is narrowly limited to mathematical algorithms in the abstract.
The Federal Circuit went on to acknowledge that they had been changing the law: Since the process of manipulation of numbers is a fundamental part of computer technology, we have had to reexamine the rules that govern the patentability of such technology. The sea-changes in both law and technology stand as a testament to the ability of law to adapt to new and innovative concepts, while remaining true to basic principles. In an earlier era, the PTO published guidelines essentially rejecting the notion that computer programs were patentable. As the technology progressed, our predecessor court disagreed, and, overturning some of the earlier limiting principles regarding 101, announced more expansive principles formulated with computer technology in mind. In our recent decision in State Street, this court discarded the so-called "business method" exception and reassessed the "mathematical algorithm" exception, both judicially-created "exceptions" to the statutory categories of 101. As this brief review suggests, this court (and its predecessor) struggled to make our understanding of the scope of 101 responsive to the needs of the modern world.
The Supreme Court has supported and enhanced this effort. In Diehr, the Court expressly limited its two earlier decisions in Flook and Benson by emphasizing that these cases did no more than confirm the "long-established principle" that laws of nature, natural phenomena, and abstract ideas are excluded from patent protection. The Diehr Court explicitly distinguished Diehr's process by pointing out that "the respondents here do not seek to patent a mathematical formula. Instead, they seek patent protection for a process of curing synthetic rubber." The Court then explained that although the process used a well-known mathematical equation, the applicants did not "pre-empt the use of that equation." Thus, even though a mathematical algorithm is not patentable in isolation, a process that applies an equation to a new and useful end "is at the very least not barred at the threshold by 101." In this regard, it is particularly worthy of note that the argument for the opposite result, that "the term 'algorithm' . . . is synonymous with the term 'computer program,'" (Stevens, J., dissenting), and thus computer-based programs as a general proposition should not be patentable, was made forcefully in dissent by Justice Stevens; his view, however, was rejected by the Diehr majority.
In State Street, the Federal Circuit, following the Supreme Court's guidance in Diehr, concluded that "[u]npatentable mathematical algorithms are identifiable by showing they are merely abstract ideas constituting disembodied concepts or truths that are not 'useful.' . . . [T]o be patentable an algorithm must be applied in a 'useful' way." In that case, the claimed data processing system for implementing a financial management structure satisfied the 101 inquiry because it constituted a "practical application of a mathematical algorithm, . . . [by] produc[ing] 'a useful, concrete and tangible result.'"
The State Street formulation followed the approach taken by the Federal Circuit en banc in In re Alappat. In Alappat, the Federal Circuit concluded that:
[The Court] never intended to create an overly broad, fourth category of [mathematical] subject matter excluded from 101. Rather, at the core of the Court's analysis . . . lies an attempt by the Court to explain a rather straightforward concept, namely, that certain types of mathematical subject matter, standing alone, represent nothing more than abstract ideas until reduced to some type of practical application, and thus that subject matter is not, in and of itself, entitled to patent protection.
Thus, the Alappat inquiry simply requires an examination of the contested claims to see if the claimed subject matter as a whole is a disembodied mathematical concept representing nothing more than a "law of nature" or an "abstract idea," or if the mathematical concept has been reduced to some practical application rendering it "useful." In Alappat, it was held that more than an abstract idea was claimed because the claimed invention as a whole was directed toward forming a specific machine that produced the useful, concrete, and tangible result of a smooth waveform display.
The Federal Circuit stated that it considered the scope of 101 to be the same regardless of the form - machine or process - in which a particular claim is drafted.
In this case, the PIC indicator value was derived using a simple mathematical principle (p and q). But that was not determinative because AT+T did not claim the Boolean principle as such or attempt to forestall its use in any other application.
AT+T was only claiming a process that used the Boolean principle in order to determine the value of the PIC indicator. The PIC indicator represented information about the call recipient's PIC, a useful, non-abstract result that facilitated differential billing of long-distance calls made by an IXC's subscriber. Because the claimed process applied the Boolean principle to produce a useful, concrete, tangible result without pre-empting other uses of the mathematical principle, on its face the claimed process comfortably fell within the scope of 101.
Excel argued that method claims containing mathematical algorithms are patentable subject matter only if there is a "physical transformation" or conversion of subject matter from one state into another. The physical transformation language appears in Diehr, and was been echoed by the Federal Circuit in Schrader.
The Federal Circuit stated that the notion of "physical transformation" was not an invariable requirement, but merely one example of how a mathematical algorithm may bring about a useful application.
Excel also contended that because the process claims at issue lacked physical limitations, the claims were not patentable subject matter. The Federal Circuit stated that because the claims at issue in this case were directed to a process in the first instance, a structural inquiry was unnecessary.
The Federal Circuit stated that the argument that physical limitations were necessary may have stemmed from the second part of the Freeman-Walter-Abele test. The Federal Circuit stated that the State Street decision questioned the continuing viability of the Freeman-Walter-Abele test, noting that, "[a]fter Diehr and Chakrabarty, the Freeman-Walter-Abele test has little, if any, applicability to determining the presence of statutory subject matter." Whatever may be left of the earlier test, if anything, this type of physical limitations analysis seems of little value because "after Diehr and Alappat, the mere fact that a claimed invention involves inputting numbers, calculating numbers, outputting numbers, and storing numbers, in and of itself, would not render it nonstatutory subject matter, unless, of course, its operation does not produce a 'useful, concrete and tangible result.'"
Because the Federal Circuit was now focusing on the inquiry deemed "the ultimate issue" by Alappat, rather than on the physical limitations inquiry of the Freeman-Walter-Abele test, it found the cases cited by Excel to be inapposite. For example, in In re Grams, the court applied the Freeman-Walter-Abele test and concluded that the only physical step in the claimed process involved data-gathering for the algorithm; thus, the claims were held to be directed to unpatentable subject matter. In contrast, our inquiry here focuses on whether the mathematical algorithm is applied in a practical manner to produce a useful result. In re Grams is unhelpful because the panel in that case did not ascertain if the end result of the claimed process was useful, concrete, and tangible.
Similarly, the court in In re Schrader relied upon the Freeman-Walter-Abele test for its analysis of the method claim involved. The court there found neither a physical transformation nor any physical step in the claimed process aside from the entering of data into a record. The Schrader court likened the data-recording step to that of data-gathering and held that the claim was properly rejected as failing to define patentable subject matter. The focus of the court in Schrader was not on whether the mathematical algorithm was applied in a practical manner since it ended its inquiry before looking to see if a useful, concrete, tangible result ensued. Thus, in light of the recent understanding of the issue, the Schrader court's analysis was as unhelpful as that of In re Grams.
Finally, the decision in In re Warmerdam, was not to the contrary. There the court recognized the difficulty in knowing exactly what a mathematical algorithm is, "which makes rather dicey the determination of whether the claim as a whole is no more than that." Warmerdam's claims 1-4 encompassed a method for controlling the motion of objects and machines to avoid collision with other moving or fixed objects by generating bubble hierarchies through the use of a particular mathematical procedure. The court found that the claimed process did nothing more than manipulate basic mathematical constructs and concluded that "taking several abstract ideas and manipulating them together adds nothing to the basic equation"; hence, the court held that the claims were properly rejected under 101. Whether one agrees with the court's conclusion on the facts, the holding of the case is a straightforward application of the basic principle that mere laws of nature, natural phenomena, and abstract ideas are not within the categories of inventions or discoveries that may be patented under 101.
In his dissent in Diehr, Justice Stevens noted two concerns regarding the 101 issue, and to which, in his view, federal judges have a duty to respond:
First, the cases considering the patentability of program-related inventions did not establish rules that enable a conscientious patent lawyer to determine with a fair degree of accuracy which, if any, program-related inventions will be patentable. Second, the inclusion of the ambiguous concept of an "algorithm" within the "law of nature" category of unpatentable subject matter has given rise to the concern that almost any process might be so described and therefore held unpatentable.
Despite the almost twenty years since Justice Stevens wrote, these concerns remained important in 1999. His solution was to declare all computer-based programming unpatentable. That has not been the course the law took. Rather, it was now clear that computer-based programming constitutes patentable subject matter so long as the basic requirements of 101 are met. Justice Stevens' concerns can be addressed within that framework.
His first concern, that the rules are not sufficiently clear to enable reasonable prediction of outcomes, should be less of a concern today in light of the refocusing of the 101 issue that Alappat and State Street have provided. His second concern, that the ambiguous concept of "algorithm" could be used to make any process unpatentable, can be laid to rest once the focus is understood to be not on whether there is a mathematical algorithm at work, but on whether the algorithm-containing invention, as a whole, produces a tangible, useful, result.
In light of the above, and consistent with the clearer understanding that our more recent cases have provided, we conclude that the district court did not apply the proper analysis to the method claims at issue. Furthermore, had the court applied the proper analysis to the stated claims, the court would have concluded that all the claims asserted fall comfortably within the broad scope of patentable subject matter under 101. Accordingly, the Federal Circuit held as a matter of law that Excel was not entitled to the grant of summary judgment of invalidity of the '184 patent under 101.
Thus, this case marked a clear end to the Freeman-Walter-Abele test and replaced it with a more liberal "tangible, useful result" test. Most significantly, a patent claim, in a software related invention, that had no structural limitations was found to be statutory.
U.S. Patent No. 5,333,184 describes a message record for long-distance telephone calls that is enhanced by adding a primary interexchange carrier ("PIC") indicator. The addition of the indicator aids long-distance carriers in providing differential billing treatment for subscribers, depending upon whether a subscriber calls someone with the same or a different long-distance carrier. AT+T's claimed process employed subscribers' and call recipients' PICs as data, applied Boolean algebra to those data to determine the value of the PIC indicator, and applied that value through switching and recording mechanisms to create a signal useful for billing purposes.
AT+T in 1996 asserted ten of the method claims against Excel in this infringement suit. The independent claims at issue (claims 1, 12, 18, and 40) included the step of "generating a message record for an interexchange call between an originating subscriber and a terminating subscriber," and the step of adding a PIC indicator to the message record. Independent claim 1, for example, adds a PIC indicator whose value depends upon the call recipient's PIC:
1. A method for use in a telecommunications system in which interexchange calls initiated by each subscriber are automatically routed over the facilities of a particular one of a plurality of interexchange carriers associated with that subscriber, said method comprising the steps of:
generating a message record for an interexchange call between an originating subscriber and a terminating subscriber, and
including, in said message record, a primary interexchange carrier (PIC) indicator having a value which is a function of whether or not the interexchange carrier associated with said terminating subscriber is a predetermined one of said interexchange carriers.
Independent claims 12 and 40 add a PIC indicator that shows if a recipient's PIC is the same as the IXC over which that particular call is being made. Independent claim 18 adds a PIC indicator designed to show if the caller and the recipient subscribe to the same IXC. The dependent claims at issue add the steps of accessing an IXC's subscriber database (claims 4, 13, and 19) and billing individual calls as a function of the value of the PIC indicator (claims 6, 15, and 21).
The district court concluded that the method claims of the patent implicitly recited a mathematical algorithm. The court was of the view that the only physical step in the claims involves data-gathering for the algorithm. Though the court recognized that the claims require the use of switches and computers, it nevertheless concluded that use of such facilities to perform a non-substantive change in the data's format could not serve to convert non-patentable subject matter into patentable subject matter. Thus the trial court, on summary judgment, held all of the method claims at issue invalid for failure to qualify as statutory subject matter.
The Federal Circuit stated that because 101 includes processes as a category of patentable subject matter, the judicially-defined proscription against patenting of a "mathematical algorithm," to the extent such a proscription still exists, is narrowly limited to mathematical algorithms in the abstract.
The Federal Circuit went on to acknowledge that they had been changing the law: Since the process of manipulation of numbers is a fundamental part of computer technology, we have had to reexamine the rules that govern the patentability of such technology. The sea-changes in both law and technology stand as a testament to the ability of law to adapt to new and innovative concepts, while remaining true to basic principles. In an earlier era, the PTO published guidelines essentially rejecting the notion that computer programs were patentable. As the technology progressed, our predecessor court disagreed, and, overturning some of the earlier limiting principles regarding 101, announced more expansive principles formulated with computer technology in mind. In our recent decision in State Street, this court discarded the so-called "business method" exception and reassessed the "mathematical algorithm" exception, both judicially-created "exceptions" to the statutory categories of 101. As this brief review suggests, this court (and its predecessor) struggled to make our understanding of the scope of 101 responsive to the needs of the modern world.
The Supreme Court has supported and enhanced this effort. In Diehr, the Court expressly limited its two earlier decisions in Flook and Benson by emphasizing that these cases did no more than confirm the "long-established principle" that laws of nature, natural phenomena, and abstract ideas are excluded from patent protection. The Diehr Court explicitly distinguished Diehr's process by pointing out that "the respondents here do not seek to patent a mathematical formula. Instead, they seek patent protection for a process of curing synthetic rubber." The Court then explained that although the process used a well-known mathematical equation, the applicants did not "pre-empt the use of that equation." Thus, even though a mathematical algorithm is not patentable in isolation, a process that applies an equation to a new and useful end "is at the very least not barred at the threshold by 101." In this regard, it is particularly worthy of note that the argument for the opposite result, that "the term 'algorithm' . . . is synonymous with the term 'computer program,'" (Stevens, J., dissenting), and thus computer-based programs as a general proposition should not be patentable, was made forcefully in dissent by Justice Stevens; his view, however, was rejected by the Diehr majority.
In State Street, the Federal Circuit, following the Supreme Court's guidance in Diehr, concluded that "[u]npatentable mathematical algorithms are identifiable by showing they are merely abstract ideas constituting disembodied concepts or truths that are not 'useful.' . . . [T]o be patentable an algorithm must be applied in a 'useful' way." In that case, the claimed data processing system for implementing a financial management structure satisfied the 101 inquiry because it constituted a "practical application of a mathematical algorithm, . . . [by] produc[ing] 'a useful, concrete and tangible result.'"
The State Street formulation followed the approach taken by the Federal Circuit en banc in In re Alappat. In Alappat, the Federal Circuit concluded that:
[The Court] never intended to create an overly broad, fourth category of [mathematical] subject matter excluded from 101. Rather, at the core of the Court's analysis . . . lies an attempt by the Court to explain a rather straightforward concept, namely, that certain types of mathematical subject matter, standing alone, represent nothing more than abstract ideas until reduced to some type of practical application, and thus that subject matter is not, in and of itself, entitled to patent protection.
Thus, the Alappat inquiry simply requires an examination of the contested claims to see if the claimed subject matter as a whole is a disembodied mathematical concept representing nothing more than a "law of nature" or an "abstract idea," or if the mathematical concept has been reduced to some practical application rendering it "useful." In Alappat, it was held that more than an abstract idea was claimed because the claimed invention as a whole was directed toward forming a specific machine that produced the useful, concrete, and tangible result of a smooth waveform display.
The Federal Circuit stated that it considered the scope of 101 to be the same regardless of the form - machine or process - in which a particular claim is drafted.
In this case, the PIC indicator value was derived using a simple mathematical principle (p and q). But that was not determinative because AT+T did not claim the Boolean principle as such or attempt to forestall its use in any other application.
AT+T was only claiming a process that used the Boolean principle in order to determine the value of the PIC indicator. The PIC indicator represented information about the call recipient's PIC, a useful, non-abstract result that facilitated differential billing of long-distance calls made by an IXC's subscriber. Because the claimed process applied the Boolean principle to produce a useful, concrete, tangible result without pre-empting other uses of the mathematical principle, on its face the claimed process comfortably fell within the scope of 101.
Excel argued that method claims containing mathematical algorithms are patentable subject matter only if there is a "physical transformation" or conversion of subject matter from one state into another. The physical transformation language appears in Diehr, and was been echoed by the Federal Circuit in Schrader.
The Federal Circuit stated that the notion of "physical transformation" was not an invariable requirement, but merely one example of how a mathematical algorithm may bring about a useful application.
Excel also contended that because the process claims at issue lacked physical limitations, the claims were not patentable subject matter. The Federal Circuit stated that because the claims at issue in this case were directed to a process in the first instance, a structural inquiry was unnecessary.
The Federal Circuit stated that the argument that physical limitations were necessary may have stemmed from the second part of the Freeman-Walter-Abele test. The Federal Circuit stated that the State Street decision questioned the continuing viability of the Freeman-Walter-Abele test, noting that, "[a]fter Diehr and Chakrabarty, the Freeman-Walter-Abele test has little, if any, applicability to determining the presence of statutory subject matter." Whatever may be left of the earlier test, if anything, this type of physical limitations analysis seems of little value because "after Diehr and Alappat, the mere fact that a claimed invention involves inputting numbers, calculating numbers, outputting numbers, and storing numbers, in and of itself, would not render it nonstatutory subject matter, unless, of course, its operation does not produce a 'useful, concrete and tangible result.'"
Because the Federal Circuit was now focusing on the inquiry deemed "the ultimate issue" by Alappat, rather than on the physical limitations inquiry of the Freeman-Walter-Abele test, it found the cases cited by Excel to be inapposite. For example, in In re Grams, the court applied the Freeman-Walter-Abele test and concluded that the only physical step in the claimed process involved data-gathering for the algorithm; thus, the claims were held to be directed to unpatentable subject matter. In contrast, our inquiry here focuses on whether the mathematical algorithm is applied in a practical manner to produce a useful result. In re Grams is unhelpful because the panel in that case did not ascertain if the end result of the claimed process was useful, concrete, and tangible.
Similarly, the court in In re Schrader relied upon the Freeman-Walter-Abele test for its analysis of the method claim involved. The court there found neither a physical transformation nor any physical step in the claimed process aside from the entering of data into a record. The Schrader court likened the data-recording step to that of data-gathering and held that the claim was properly rejected as failing to define patentable subject matter. The focus of the court in Schrader was not on whether the mathematical algorithm was applied in a practical manner since it ended its inquiry before looking to see if a useful, concrete, tangible result ensued. Thus, in light of the recent understanding of the issue, the Schrader court's analysis was as unhelpful as that of In re Grams.
Finally, the decision in In re Warmerdam, was not to the contrary. There the court recognized the difficulty in knowing exactly what a mathematical algorithm is, "which makes rather dicey the determination of whether the claim as a whole is no more than that." Warmerdam's claims 1-4 encompassed a method for controlling the motion of objects and machines to avoid collision with other moving or fixed objects by generating bubble hierarchies through the use of a particular mathematical procedure. The court found that the claimed process did nothing more than manipulate basic mathematical constructs and concluded that "taking several abstract ideas and manipulating them together adds nothing to the basic equation"; hence, the court held that the claims were properly rejected under 101. Whether one agrees with the court's conclusion on the facts, the holding of the case is a straightforward application of the basic principle that mere laws of nature, natural phenomena, and abstract ideas are not within the categories of inventions or discoveries that may be patented under 101.
In his dissent in Diehr, Justice Stevens noted two concerns regarding the 101 issue, and to which, in his view, federal judges have a duty to respond:
First, the cases considering the patentability of program-related inventions did not establish rules that enable a conscientious patent lawyer to determine with a fair degree of accuracy which, if any, program-related inventions will be patentable. Second, the inclusion of the ambiguous concept of an "algorithm" within the "law of nature" category of unpatentable subject matter has given rise to the concern that almost any process might be so described and therefore held unpatentable.
Despite the almost twenty years since Justice Stevens wrote, these concerns remained important in 1999. His solution was to declare all computer-based programming unpatentable. That has not been the course the law took. Rather, it was now clear that computer-based programming constitutes patentable subject matter so long as the basic requirements of 101 are met. Justice Stevens' concerns can be addressed within that framework.
His first concern, that the rules are not sufficiently clear to enable reasonable prediction of outcomes, should be less of a concern today in light of the refocusing of the 101 issue that Alappat and State Street have provided. His second concern, that the ambiguous concept of "algorithm" could be used to make any process unpatentable, can be laid to rest once the focus is understood to be not on whether there is a mathematical algorithm at work, but on whether the algorithm-containing invention, as a whole, produces a tangible, useful, result.
In light of the above, and consistent with the clearer understanding that our more recent cases have provided, we conclude that the district court did not apply the proper analysis to the method claims at issue. Furthermore, had the court applied the proper analysis to the stated claims, the court would have concluded that all the claims asserted fall comfortably within the broad scope of patentable subject matter under 101. Accordingly, the Federal Circuit held as a matter of law that Excel was not entitled to the grant of summary judgment of invalidity of the '184 patent under 101.
Thus, this case marked a clear end to the Freeman-Walter-Abele test and replaced it with a more liberal "tangible, useful result" test. Most significantly, a patent claim, in a software related invention, that had no structural limitations was found to be statutory.
State Street Bank & Trust Co. v. Signature Financial Group, Inc., 1998
This case opened the door for business method patents, at least where the business method was implemented in software in a system that included some hardware, like a processor and storage means.
Signature Financial Group, Inc. appealed from a decision of the United States District Court for the District of Massachusetts granting a motion for summary judgment in favor of State Street Bank & Trust Co., finding U.S. Patent No. 5,193,056 invalid on the ground that the claimed subject matter was not encompassed by 35 U.S.C. Section 101.
Signature was the assignee of the '056 patent entitled "Data Processing System for Hub and Spoke Financial Services Configuration." The '056 patent is generally directed to a data processing system (the system) for implementing an investment structure which was developed for use in Signature's business as an administrator and accounting agent for mutual funds. The system facilitates a structure whereby mutual funds (Spokes) pool their assets in an investment portfolio (Hub) organized as a partnership. This investment configuration provides the administrator of a mutual fund with the advantageous combination of economies of scale in administering investments coupled with the tax advantages of a partnership.
The Federal Circuit stated that when independent claim 1 is properly construed in accordance with section 112, paragraph 6, it is directed to a machine, as demonstrated below, where representative claim 1 is set forth, the subject matter in brackets stating the structure the written description discloses as corresponding to the respective "means" recited in the claims.
1. A data processing system for managing a financial services configuration of a portfolio established as a partnership, each partner being one of a plurality of funds, comprising:
a computer processor means [a personal computer including a CPU] for processing data;
b storage means [a data disk] for storing data on a storage medium;
c first means [an arithmetic logic circuit configured to prepare the data disk to magnetically store selected data] for initializing the storage medium;
d second means [an arithmetic logic circuit configured to retrieve information from a specific file, calculate incremental increases or decreases based on specific input, allocate the results on a percentage basis, and store the output in a separate file] for processing data regarding assets in the portfolio and each of the funds from a previous day and data regarding increases or decreases in each of the funds, [sic, funds'] assets and for allocating the percentage share that each fund holds in the portfolio;
e third means [an arithmetic logic circuit configured to retrieve information from a specific file, calculate incremental increases and decreases based on specific input, allocate the results on a percentage basis and store the output in a separate file] for processing data regarding daily incremental income, expenses, and net realized gain or loss for the portfolio and for allocating such data among each fund;
f fourth means [an arithmetic logic circuit configured to retrieve information from a specific file, calculate incremental increases and decreases based on specific input, allocate the results on a percentage basis and store the output in a separate file] for processing data regarding daily net unrealized gain or loss for the portfolio and for allocating such data among each fund; and
g fifth means [an arithmetic logic circuit configured to retrieve information from specific files, calculate that information on an aggregate basis and store the output in a separate file] for processing data regarding aggregate year-end income, expenses, and capital gain or loss for the portfolio and each of the funds.
The Federal Circuit stated that claim 1 was directed to a machine programmed with the Hub and Spoke software and admittedly produces a "useful, concrete, and tangible result" as required by Alappat, 33 F.3d at 1544, 31 USPQ2d at 1557. This rendered it statutory subject matter, even if the useful result is expressed in numbers, such as price, profit, percentage, cost, or loss.
As an alternative ground for invalidating the '056 patent under section 101, the lower district court had relied on the judicially-created, so-called "business method" exception to statutory subject matter. The Federal Circuit took this opportunity to lay this ill-conceived exception to rest. Since its inception, the "business method" exception has merely represented the application of some general, but no longer applicable legal principle, perhaps arising out of the "requirement for invention"--which was eliminated by section 103. Since the 1952 Patent Act, business methods have been, and should have been, subject to the same legal requirements for patentability as applied to any other process or method.
The business method exception was never invoked by the Federal Circuit, or the CCPA, to deem an invention unpatentable. Application of this particular exception has always been preceded by a ruling based on some clearer concept of Title 35 or, more commonly, application of the abstract idea exception based on finding a mathematical algorithm. Illustrative is the CCPA's analysis in In re Howard, 394 F.2d 869, 157 USPQ 615 (CCPA 1968), wherein the court affirmed the Board of Appeals' rejection of the claims for lack of novelty and found it unnecessary to reach the Board's section 101 ground that a method of doing business is "inherently unpatentable." Id. at 872, 157 USPQ at 617.(12)
Similarly, In re Schrader, 22 F.3d 290, 30 USPQ2d 1455 (Fed. Cir. 1994), while making reference to the business method exception, turned on the fact that the claims implicitly recited an abstract idea in the form of a mathematical algorithm and there was no "transformation or conversion of subject matter representative of or constituting physical activity or objects."
The Federal Circuit stated that even the case frequently cited as establishing the business method exception to statutory subject matter, Hotel Security Checking Co. v. Lorraine Co., 160 F. 467 (2d Cir. 1908), did not rely on the exception to strike the patent. In that case, the patent was found invalid for lack of novelty and "invention," not because it was improper subject matter for a patent. The court stated "the fundamental principle of the system is as old as the art of bookkeeping, i.e., charging the goods of the employer to the agent who takes them." "If at the time of [the patent] application, there had been no system of bookkeeping of any kind in restaurants, we would be confronted with the question whether a new and useful system of cash registering and account checking is such an art as is patentable under the statute."
The Federal Circuit stated that this case was no exception. The district court had announced the precepts of the business method exception as set forth in several treatises, but noted as its primary reason for finding the patent invalid under the business method exception as follows:
If Signature's invention were patentable, any financial institution desirous of implementing a multi-tiered funding complex modelled (sic) on a Hub and Spoke configuration would be required to seek Signature's permission before embarking on such a project. This is so because the '056 Patent is claimed [sic] sufficiently broadly to foreclose virtually any computer-implemented accounting method necessary to manage this type of financial structure.
Whether the patent's claims are too broad to be patentable is not to be judged under section 101, but rather under sections 102, 103 and 112. Assuming the above statement to be correct, it has nothing to do with whether what is claimed is statutory subject matter.
In view of this background, it comes as no surprise that in the most recent edition of the Manual of Patent Examining Procedures (MPEP) (1996), a paragraph of section 706.03(a) was deleted. In past editions it read:
Though seemingly within the category of process or method, a method of doing business can be rejected as not being within the statutory classes. See Hotel Security Checking Co. v. Lorraine Co., 160 F. 467 (2nd Cir. 1908) and In re Wait, 24 USPQ 88, 22 CCPA 822 (1934).
MPEP section 706.03(a) (1994). This acknowledgment is buttressed by the U.S. Patent and Trademark 1996 Examination Guidelines for Computer Related Inventions which now read:
Office personnel have had difficulty in properly treating claims directed to methods of doing business. Claims should not be categorized as methods of doing business. Instead such claims should be treated like any other process claims.
The Federal Circuit agreed that this was precisely the manner in which this type of claim should be treated. Whether the claims are directed to subject matter within section 101 should not turn on whether the claimed subject matter does "business" instead of something else.
Signature Financial Group, Inc. appealed from a decision of the United States District Court for the District of Massachusetts granting a motion for summary judgment in favor of State Street Bank & Trust Co., finding U.S. Patent No. 5,193,056 invalid on the ground that the claimed subject matter was not encompassed by 35 U.S.C. Section 101.
Signature was the assignee of the '056 patent entitled "Data Processing System for Hub and Spoke Financial Services Configuration." The '056 patent is generally directed to a data processing system (the system) for implementing an investment structure which was developed for use in Signature's business as an administrator and accounting agent for mutual funds. The system facilitates a structure whereby mutual funds (Spokes) pool their assets in an investment portfolio (Hub) organized as a partnership. This investment configuration provides the administrator of a mutual fund with the advantageous combination of economies of scale in administering investments coupled with the tax advantages of a partnership.
The Federal Circuit stated that when independent claim 1 is properly construed in accordance with section 112, paragraph 6, it is directed to a machine, as demonstrated below, where representative claim 1 is set forth, the subject matter in brackets stating the structure the written description discloses as corresponding to the respective "means" recited in the claims.
1. A data processing system for managing a financial services configuration of a portfolio established as a partnership, each partner being one of a plurality of funds, comprising:
a computer processor means [a personal computer including a CPU] for processing data;
b storage means [a data disk] for storing data on a storage medium;
c first means [an arithmetic logic circuit configured to prepare the data disk to magnetically store selected data] for initializing the storage medium;
d second means [an arithmetic logic circuit configured to retrieve information from a specific file, calculate incremental increases or decreases based on specific input, allocate the results on a percentage basis, and store the output in a separate file] for processing data regarding assets in the portfolio and each of the funds from a previous day and data regarding increases or decreases in each of the funds, [sic, funds'] assets and for allocating the percentage share that each fund holds in the portfolio;
e third means [an arithmetic logic circuit configured to retrieve information from a specific file, calculate incremental increases and decreases based on specific input, allocate the results on a percentage basis and store the output in a separate file] for processing data regarding daily incremental income, expenses, and net realized gain or loss for the portfolio and for allocating such data among each fund;
f fourth means [an arithmetic logic circuit configured to retrieve information from a specific file, calculate incremental increases and decreases based on specific input, allocate the results on a percentage basis and store the output in a separate file] for processing data regarding daily net unrealized gain or loss for the portfolio and for allocating such data among each fund; and
g fifth means [an arithmetic logic circuit configured to retrieve information from specific files, calculate that information on an aggregate basis and store the output in a separate file] for processing data regarding aggregate year-end income, expenses, and capital gain or loss for the portfolio and each of the funds.
The Federal Circuit stated that claim 1 was directed to a machine programmed with the Hub and Spoke software and admittedly produces a "useful, concrete, and tangible result" as required by Alappat, 33 F.3d at 1544, 31 USPQ2d at 1557. This rendered it statutory subject matter, even if the useful result is expressed in numbers, such as price, profit, percentage, cost, or loss.
As an alternative ground for invalidating the '056 patent under section 101, the lower district court had relied on the judicially-created, so-called "business method" exception to statutory subject matter. The Federal Circuit took this opportunity to lay this ill-conceived exception to rest. Since its inception, the "business method" exception has merely represented the application of some general, but no longer applicable legal principle, perhaps arising out of the "requirement for invention"--which was eliminated by section 103. Since the 1952 Patent Act, business methods have been, and should have been, subject to the same legal requirements for patentability as applied to any other process or method.
The business method exception was never invoked by the Federal Circuit, or the CCPA, to deem an invention unpatentable. Application of this particular exception has always been preceded by a ruling based on some clearer concept of Title 35 or, more commonly, application of the abstract idea exception based on finding a mathematical algorithm. Illustrative is the CCPA's analysis in In re Howard, 394 F.2d 869, 157 USPQ 615 (CCPA 1968), wherein the court affirmed the Board of Appeals' rejection of the claims for lack of novelty and found it unnecessary to reach the Board's section 101 ground that a method of doing business is "inherently unpatentable." Id. at 872, 157 USPQ at 617.(12)
Similarly, In re Schrader, 22 F.3d 290, 30 USPQ2d 1455 (Fed. Cir. 1994), while making reference to the business method exception, turned on the fact that the claims implicitly recited an abstract idea in the form of a mathematical algorithm and there was no "transformation or conversion of subject matter representative of or constituting physical activity or objects."
The Federal Circuit stated that even the case frequently cited as establishing the business method exception to statutory subject matter, Hotel Security Checking Co. v. Lorraine Co., 160 F. 467 (2d Cir. 1908), did not rely on the exception to strike the patent. In that case, the patent was found invalid for lack of novelty and "invention," not because it was improper subject matter for a patent. The court stated "the fundamental principle of the system is as old as the art of bookkeeping, i.e., charging the goods of the employer to the agent who takes them." "If at the time of [the patent] application, there had been no system of bookkeeping of any kind in restaurants, we would be confronted with the question whether a new and useful system of cash registering and account checking is such an art as is patentable under the statute."
The Federal Circuit stated that this case was no exception. The district court had announced the precepts of the business method exception as set forth in several treatises, but noted as its primary reason for finding the patent invalid under the business method exception as follows:
If Signature's invention were patentable, any financial institution desirous of implementing a multi-tiered funding complex modelled (sic) on a Hub and Spoke configuration would be required to seek Signature's permission before embarking on such a project. This is so because the '056 Patent is claimed [sic] sufficiently broadly to foreclose virtually any computer-implemented accounting method necessary to manage this type of financial structure.
Whether the patent's claims are too broad to be patentable is not to be judged under section 101, but rather under sections 102, 103 and 112. Assuming the above statement to be correct, it has nothing to do with whether what is claimed is statutory subject matter.
In view of this background, it comes as no surprise that in the most recent edition of the Manual of Patent Examining Procedures (MPEP) (1996), a paragraph of section 706.03(a) was deleted. In past editions it read:
Though seemingly within the category of process or method, a method of doing business can be rejected as not being within the statutory classes. See Hotel Security Checking Co. v. Lorraine Co., 160 F. 467 (2nd Cir. 1908) and In re Wait, 24 USPQ 88, 22 CCPA 822 (1934).
MPEP section 706.03(a) (1994). This acknowledgment is buttressed by the U.S. Patent and Trademark 1996 Examination Guidelines for Computer Related Inventions which now read:
Office personnel have had difficulty in properly treating claims directed to methods of doing business. Claims should not be categorized as methods of doing business. Instead such claims should be treated like any other process claims.
The Federal Circuit agreed that this was precisely the manner in which this type of claim should be treated. Whether the claims are directed to subject matter within section 101 should not turn on whether the claimed subject matter does "business" instead of something else.
1996 Examination Guidelines for Computer Related Inventions
After In re Beauregard, the U.S. Patent and Trademark Office issued its Examination Guidelines for Computer Related Inventions. This marked a real turning point in that now internal PTO guidelines were published that applicants could use when arguing with Examiners. Examiners were being told that they could actually allow certain software patents. Though many were still reluctant. Because these guidelines are an important piece of history, and not easy to find on the USPTO website, I have placed a copy on my web server and it is available here:
http://www.patentsusa.com/1996_guidelines.pdf
The most relevant points (in my opinion) of these guidelines are as follows (keep in mind that this was only the Patent Office's interpretation):
The utility of an invention must be within the "technological" arts. A computer-related invention is within the technological arts. A practical application of a computer-related invention is statutory subject matter.
1. Non-Statutory Subject Matter
Claims to computer-related inventions that are clearly non-statutory fall into the same general categories as non-statutory claims in other arts, namely natural phenomena such as magnetism, and abstract ideas or laws of nature which constitute "descriptive material." Descriptive material can be characterized as either "functional descriptive material" or "non-functional descriptive material." In this context, "functional descriptive material" consists of data structures[27] and computer programs which impart functionality when encoded on a computer-readable medium. "Non-functional descriptive material" includes but is not limited to music, literary works and a compilation or mere arrangement of data.
Both types of "descriptive material" are non-statutory when claimed as descriptive material per se. When functional descriptive material is recorded on some computer-readable medium it becomes structurally and functionally interrelated to the medium and will be statutory in most cases. When non-functional descriptive material is recorded on some computer-readable medium, it is not structurally and functionally interrelated to the medium but is merely carried by the medium. Merely claiming non-functional descriptive material stored in a computer-readable medium does not make it statutory. Such a result would exalt form over substance. Thus, non-statutory music does not become statutory by merely recording it on a compact disk. Protection for this type of work is provided under the copyright law.
Data structures not claimed as embodied in computer-readable media are descriptive material per se and are not statutory because they are neither physical "things" nor statutory processes. Such claimed data structures do not define any structural and functional interrelationships between the data structure and other claimed aspects of the invention which permit the data structure's functionality to be realized. In contrast, a claimed computer-readable medium encoded with a data structure defines structural and functional interrelationships between the data structure and the medium which permit the data structure's functionality to be realized, and is thus statutory.
Similarly, computer programs claimed as computer listings per se, i.e., the descriptions or expressions of the programs, are not physical "things," nor are they statutory processes, as they are not "acts" being performed. Such claimed computer programs do not define any structural and functional interrelationships between the computer program and other claimed aspects of the invention which permit the computer program's functionality to be realized. In contrast, a claimed computer-readable medium encoded with a computer program defines structural and functional interrelationships between the computer program and the medium which permit the computer program's functionality to be realized, and is thus statutory. Accordingly, it is important to distinguish claims that define descriptive material per se from claims that define statutory inventions.
Natural Phenomena Such as Electricity and Magnetism
Claims that recite nothing but the physical characteristics of a form of energy, such as a frequency, voltage, or the strength of a magnetic field, define energy or magnetism, per se, and as such are non-statutory natural phenomena.[33] However, a claim directed to a practical application of a natural phenomenon such as energy or magnetism is statutory.
2. Statutory Subject Matter
(a) Statutory Product Claims
If a claim defines a useful machine or manufacture by identifying the physical structure of the machine or manufacture in terms of its hardware or hardware and software combination, it defines a statutory product.
Claims that Encompass Any Machine or Manufacture Embodiment of a Process
Office personnel must treat each claim as a whole. The mere fact that a hardware element is recited in a claim does not necessarily limit the claim to a specific machine or manufacture. If a product claim encompasses any and every computer implementation of a process, when read in light of the specification, it should be examined on the basis of the underlying process.
A claim limited to a specific machine or manufacture, which has a practical application in the technological arts, is statutory. In most cases, a claim to a specific machine or manufacture will have a practical application in the technological arts.
Statutory Process Claims
To be statutory, a claimed computer-related process must either:
(1) result in a physical transformation outside the computer for which a practical application in the technological arts is either disclosed in the specification or would have been known to a skilled artisan, or
(2) be limited by the language in the claim to a practical application within the technological arts.
If a physical transformation occurs outside the computer, it is not necessary to claim the practical application. On the other hand, it is necessary to claim the practical application if there is no physical transformation or if the process merely manipulates concepts or converts one set of numbers into another.
A claimed process is clearly statutory if it results in a physical transformation outside the computer, i.e., falls into one or both of the following specific categories ("safe harbors").
(i) Safe Harbors
- Independent Physical Acts (Post-Computer Process Activity)
A process is statutory if it requires physical acts to be performed outside the computer independent of and following the steps to be performed by a programmed computer, where those acts involve the manipulation of tangible physical objects and result in the object having a different physical attribute or structure. Thus, if a process claim includes one or more post-computer process steps that result in a physical transformation outside the computer (beyond merely conveying the direct result of the computer operation, the claim is clearly statutory.
Examples of this type of statutory process include the following:
- A method of curing rubber in a mold which relies upon updating process parameters, using a computer processor to determine a time period for curing the rubber, using the computer processor to determine when the time period has been reached in the curing process and then opening the mold at that stage.
- A method of controlling a mechanical robot which relies upon storing data in a computer that represents various types of mechanical movements of the robot, using a computer processor to calculate positioning of the robot in relation to given tasks to be performed by the robot, and controlling the robot's movement and position based on the calculated position.
- Manipulation of Data Representing Physical Objects or Activities (Pre-Computer Process Activity)
Another statutory process is one that requires the measurements of physical objects or activities to be transformed outside of the computer into computer data,[42] where the data comprises signals corresponding to physical objects or activities external to the computer system, and where the process causes a physical transformation of the signals which are intangible representations of the physical objects or activities.
Examples of this type of claimed statutory process include the following:
- A method of using a computer processor to analyze electrical signals and data representative of human cardiac activity by converting the signals to time segments, applying the time segments in reverse order to a high pass filter means, using the computer processor to determine the amplitude of the high pass filter's output, and using the computer processor to compare the value to a predetermined value. In this example the data is an intangible representation of physical activity, i.e., human cardiac activity. The transformation occurs when heart activity is measured and an electrical signal is produced. This process has real world value in predicting vulnerability to ventricular tachycardia immediately after a heart attack.
- A method of using a computer processor to receive data representing Computerized Axial Tomography ("CAT") scan images of a patient, performing a calculation to determine the difference between a local value at a data point and an average value of the data in a region surrounding the point, and displaying the difference as a gray scale for each point in the image, and displaying the resulting image. In this example the data is an intangible representation of a physical object, i.e., portions of the anatomy of a patient. The transformation occurs when the condition of the human body is measured with X-rays and the X-rays are converted into electrical digital signals that represent the condition of the human body. The real world value of the invention lies in creating a new CAT scan image of body tissue without the presence of bones.
- A method of using a computer processor to conduct seismic exploration, by imparting spherical seismic energy waves into the earth from a seismic source, generating a plurality of reflected signals in response to the seismic energy waves at a set of receiver positions in an array, and summing the reflection signals to produce a signal simulating the reflection response of the earth to the seismic energy. In this example, the electrical signals processed by the computer represent reflected seismic energy. The transformation occurs by converting the spherical seismic energy waves into electrical signals which provide a geophysical representation of formations below the earth's surface. Geophysical exploration of formations below the surface of the earth has real world value.
If a claim does not clearly fall into one or both of the safe harbors, the claim may still be statutory if it is limited by the language in the claim to a practical application in the technological arts.
(ii) Computer-Related Processes Limited to a Practical Application in the Technological Arts
There is always some form of physical transformation within a computer because a computer acts on signals and transforms them during its operation and changes the state of its components during the execution of a process. Even though such a physical transformation occurs within a computer, such activity is not determinative of whether the process is statutory because such transformation alone does not distinguish a statutory computer process from a non-statutory computer process. What is determinative is not how the computer performs the process, but what the computer does to achieve a practical application.
A process that merely manipulates an abstract idea or performs a purely mathematical algorithm is non-statutory despite the fact that it might inherently have some usefulness. For such subject matter to be statutory, the claimed process must be limited to a practical application of the abstract idea or mathematical algorithm in the technological arts. For example, a computer process that simply calculates a mathematical algorithm that models noise is non-statutory. However, a claimed process for digitally filtering noise employing the mathematical algorithm is statutory. Examples of this type of claimed statutory process include the following:
- A computerized method of optimally controlling transfer, storage and retrieval of data between cache and hard disk storage devices such that the most frequently used data is readily available.
- A method of controlling parallel processors to accomplish multi-tasking of several computing tasks to maximize computing efficiency.
- A method of making a word processor by storing an executable word processing application program in a general purpose digital computer's memory, and executing the stored program to impart word processing functionality to the general purpose digital computer by changing the state of the computer's arithmetic logic unit when program instructions of the word processing program are executed.
- A digital filtering process for removing noise from a digital signal comprising the steps of calculating a mathematical algorithm to produce a correction signal and subtracting the correction signal from the digital signal to remove the noise.
Non-Statutory Process Claims
If the "acts" of a claimed process manipulate only numbers, abstract concepts or ideas, or signals representing any of the foregoing, the acts are not being applied to appropriate subject matter. Thus, a process consisting solely of mathematical operations, i.e., converting one set of numbers into another set of numbers, does not manipulate appropriate subject matter and thus cannot constitute a statutory process.
http://www.patentsusa.com/1996_guidelines.pdf
The most relevant points (in my opinion) of these guidelines are as follows (keep in mind that this was only the Patent Office's interpretation):
The utility of an invention must be within the "technological" arts. A computer-related invention is within the technological arts. A practical application of a computer-related invention is statutory subject matter.
1. Non-Statutory Subject Matter
Claims to computer-related inventions that are clearly non-statutory fall into the same general categories as non-statutory claims in other arts, namely natural phenomena such as magnetism, and abstract ideas or laws of nature which constitute "descriptive material." Descriptive material can be characterized as either "functional descriptive material" or "non-functional descriptive material." In this context, "functional descriptive material" consists of data structures[27] and computer programs which impart functionality when encoded on a computer-readable medium. "Non-functional descriptive material" includes but is not limited to music, literary works and a compilation or mere arrangement of data.
Both types of "descriptive material" are non-statutory when claimed as descriptive material per se. When functional descriptive material is recorded on some computer-readable medium it becomes structurally and functionally interrelated to the medium and will be statutory in most cases. When non-functional descriptive material is recorded on some computer-readable medium, it is not structurally and functionally interrelated to the medium but is merely carried by the medium. Merely claiming non-functional descriptive material stored in a computer-readable medium does not make it statutory. Such a result would exalt form over substance. Thus, non-statutory music does not become statutory by merely recording it on a compact disk. Protection for this type of work is provided under the copyright law.
Data structures not claimed as embodied in computer-readable media are descriptive material per se and are not statutory because they are neither physical "things" nor statutory processes. Such claimed data structures do not define any structural and functional interrelationships between the data structure and other claimed aspects of the invention which permit the data structure's functionality to be realized. In contrast, a claimed computer-readable medium encoded with a data structure defines structural and functional interrelationships between the data structure and the medium which permit the data structure's functionality to be realized, and is thus statutory.
Similarly, computer programs claimed as computer listings per se, i.e., the descriptions or expressions of the programs, are not physical "things," nor are they statutory processes, as they are not "acts" being performed. Such claimed computer programs do not define any structural and functional interrelationships between the computer program and other claimed aspects of the invention which permit the computer program's functionality to be realized. In contrast, a claimed computer-readable medium encoded with a computer program defines structural and functional interrelationships between the computer program and the medium which permit the computer program's functionality to be realized, and is thus statutory. Accordingly, it is important to distinguish claims that define descriptive material per se from claims that define statutory inventions.
Natural Phenomena Such as Electricity and Magnetism
Claims that recite nothing but the physical characteristics of a form of energy, such as a frequency, voltage, or the strength of a magnetic field, define energy or magnetism, per se, and as such are non-statutory natural phenomena.[33] However, a claim directed to a practical application of a natural phenomenon such as energy or magnetism is statutory.
2. Statutory Subject Matter
(a) Statutory Product Claims
If a claim defines a useful machine or manufacture by identifying the physical structure of the machine or manufacture in terms of its hardware or hardware and software combination, it defines a statutory product.
Claims that Encompass Any Machine or Manufacture Embodiment of a Process
Office personnel must treat each claim as a whole. The mere fact that a hardware element is recited in a claim does not necessarily limit the claim to a specific machine or manufacture. If a product claim encompasses any and every computer implementation of a process, when read in light of the specification, it should be examined on the basis of the underlying process.
A claim limited to a specific machine or manufacture, which has a practical application in the technological arts, is statutory. In most cases, a claim to a specific machine or manufacture will have a practical application in the technological arts.
Statutory Process Claims
To be statutory, a claimed computer-related process must either:
(1) result in a physical transformation outside the computer for which a practical application in the technological arts is either disclosed in the specification or would have been known to a skilled artisan, or
(2) be limited by the language in the claim to a practical application within the technological arts.
If a physical transformation occurs outside the computer, it is not necessary to claim the practical application. On the other hand, it is necessary to claim the practical application if there is no physical transformation or if the process merely manipulates concepts or converts one set of numbers into another.
A claimed process is clearly statutory if it results in a physical transformation outside the computer, i.e., falls into one or both of the following specific categories ("safe harbors").
(i) Safe Harbors
- Independent Physical Acts (Post-Computer Process Activity)
A process is statutory if it requires physical acts to be performed outside the computer independent of and following the steps to be performed by a programmed computer, where those acts involve the manipulation of tangible physical objects and result in the object having a different physical attribute or structure. Thus, if a process claim includes one or more post-computer process steps that result in a physical transformation outside the computer (beyond merely conveying the direct result of the computer operation, the claim is clearly statutory.
Examples of this type of statutory process include the following:
- A method of curing rubber in a mold which relies upon updating process parameters, using a computer processor to determine a time period for curing the rubber, using the computer processor to determine when the time period has been reached in the curing process and then opening the mold at that stage.
- A method of controlling a mechanical robot which relies upon storing data in a computer that represents various types of mechanical movements of the robot, using a computer processor to calculate positioning of the robot in relation to given tasks to be performed by the robot, and controlling the robot's movement and position based on the calculated position.
- Manipulation of Data Representing Physical Objects or Activities (Pre-Computer Process Activity)
Another statutory process is one that requires the measurements of physical objects or activities to be transformed outside of the computer into computer data,[42] where the data comprises signals corresponding to physical objects or activities external to the computer system, and where the process causes a physical transformation of the signals which are intangible representations of the physical objects or activities.
Examples of this type of claimed statutory process include the following:
- A method of using a computer processor to analyze electrical signals and data representative of human cardiac activity by converting the signals to time segments, applying the time segments in reverse order to a high pass filter means, using the computer processor to determine the amplitude of the high pass filter's output, and using the computer processor to compare the value to a predetermined value. In this example the data is an intangible representation of physical activity, i.e., human cardiac activity. The transformation occurs when heart activity is measured and an electrical signal is produced. This process has real world value in predicting vulnerability to ventricular tachycardia immediately after a heart attack.
- A method of using a computer processor to receive data representing Computerized Axial Tomography ("CAT") scan images of a patient, performing a calculation to determine the difference between a local value at a data point and an average value of the data in a region surrounding the point, and displaying the difference as a gray scale for each point in the image, and displaying the resulting image. In this example the data is an intangible representation of a physical object, i.e., portions of the anatomy of a patient. The transformation occurs when the condition of the human body is measured with X-rays and the X-rays are converted into electrical digital signals that represent the condition of the human body. The real world value of the invention lies in creating a new CAT scan image of body tissue without the presence of bones.
- A method of using a computer processor to conduct seismic exploration, by imparting spherical seismic energy waves into the earth from a seismic source, generating a plurality of reflected signals in response to the seismic energy waves at a set of receiver positions in an array, and summing the reflection signals to produce a signal simulating the reflection response of the earth to the seismic energy. In this example, the electrical signals processed by the computer represent reflected seismic energy. The transformation occurs by converting the spherical seismic energy waves into electrical signals which provide a geophysical representation of formations below the earth's surface. Geophysical exploration of formations below the surface of the earth has real world value.
If a claim does not clearly fall into one or both of the safe harbors, the claim may still be statutory if it is limited by the language in the claim to a practical application in the technological arts.
(ii) Computer-Related Processes Limited to a Practical Application in the Technological Arts
There is always some form of physical transformation within a computer because a computer acts on signals and transforms them during its operation and changes the state of its components during the execution of a process. Even though such a physical transformation occurs within a computer, such activity is not determinative of whether the process is statutory because such transformation alone does not distinguish a statutory computer process from a non-statutory computer process. What is determinative is not how the computer performs the process, but what the computer does to achieve a practical application.
A process that merely manipulates an abstract idea or performs a purely mathematical algorithm is non-statutory despite the fact that it might inherently have some usefulness. For such subject matter to be statutory, the claimed process must be limited to a practical application of the abstract idea or mathematical algorithm in the technological arts. For example, a computer process that simply calculates a mathematical algorithm that models noise is non-statutory. However, a claimed process for digitally filtering noise employing the mathematical algorithm is statutory. Examples of this type of claimed statutory process include the following:
- A computerized method of optimally controlling transfer, storage and retrieval of data between cache and hard disk storage devices such that the most frequently used data is readily available.
- A method of controlling parallel processors to accomplish multi-tasking of several computing tasks to maximize computing efficiency.
- A method of making a word processor by storing an executable word processing application program in a general purpose digital computer's memory, and executing the stored program to impart word processing functionality to the general purpose digital computer by changing the state of the computer's arithmetic logic unit when program instructions of the word processing program are executed.
- A digital filtering process for removing noise from a digital signal comprising the steps of calculating a mathematical algorithm to produce a correction signal and subtracting the correction signal from the digital signal to remove the noise.
Non-Statutory Process Claims
If the "acts" of a claimed process manipulate only numbers, abstract concepts or ideas, or signals representing any of the foregoing, the acts are not being applied to appropriate subject matter. Thus, a process consisting solely of mathematical operations, i.e., converting one set of numbers into another set of numbers, does not manipulate appropriate subject matter and thus cannot constitute a statutory process.
In re Beauregard, 1995
In re Beauregard is the case that opened things up completely for software patents. It signaled the end of the U.S. Patent and Trademark Office's resistance to allow patent applications that contained algorithms.
Beauregard's invention, described in U.S. Patent Application Serial No. 07/521,858, now U.S. Patent No. 5,710,578 (to IBM), related to graphical raster displays, and to a system and method for filling in the area defined by the boundaries of a polygon that is being displayed on a graphical raster display system. The invention related to accurately filling a polygon by including the points in an algorithm, called the Bresenham algorithm, that define the boundaries of a polygon in the resulting filled polygon.
The claims recites “a computer usable medium” on which was stored “computer readable program code means,” i.e., a particular piece of computer software for filling a polygon displayed on a graphics display device. Claim 22 was representative:
Claim 22. An article of manufacture comprising:
a computer usable medium having computer readable program code means embodied therein for causing a polygon having a boundary definable by a plurality of selectable pels on a graphics display to be filled, the computer readable program code means in said article of manufacture comprising:
computer readable program code means for causing a computer to effect, with respect to one boundary line at a time, a sequential traverse of said plurality of selectable pels of each respective said boundary line;
computer readable program code means for causing the computer to store in an array during said traverse a value of an outer pel of said boundary of said plurality of selectable pels for each one of a plurality of scan lines of said polygon; and
computer readable program code means for causing the computer to draw a fill line, after said traverse, between said outer pels having said stored values, for each said one of said scan lines.
The USPTO Board rejected the claims using a variant of the printed matter rejection similar to that used in Lowry.
The California Multimedia and Software Patent Alliance filed a Amicus brief that asserted the following points, which were representative of the points raised by those who believed software patents were necessary:
The issue of whether a computer usable medium on which a particular piece of computer software is stored is protectable under the patent system is a particularly important one to the California multimedia and software industry for three reasons.
First, the copyright laws, perceived by many to be the most appropriate means for achieving protection of computer software, are inadequate. Under the abstraction/filtration/comparison test, which has been adopted in various forms by both the Ninth and Second Circuits as the appropriate method of defining the protectable aspects of computer software under the copyright laws, the ideas behind (or functions performed by) software are not protectable under the copyright laws. Thus, the scope of protection available is narrow and undefined.
Many other groups also filed Amicus briefs supporting Beauregard.
The Patent and Trademark Office filed a Motion to Dismiss stating that it was in agreement with the applicant that its claims recited statutory subject matter. The Federal Circuit noted that the parties were in agreement and that no case or controversy existed. The Federal Circuit vacated the Board of Appeals’s decision and remanded.
This was good news indeed for applicants.
Beauregard's invention, described in U.S. Patent Application Serial No. 07/521,858, now U.S. Patent No. 5,710,578 (to IBM), related to graphical raster displays, and to a system and method for filling in the area defined by the boundaries of a polygon that is being displayed on a graphical raster display system. The invention related to accurately filling a polygon by including the points in an algorithm, called the Bresenham algorithm, that define the boundaries of a polygon in the resulting filled polygon.
The claims recites “a computer usable medium” on which was stored “computer readable program code means,” i.e., a particular piece of computer software for filling a polygon displayed on a graphics display device. Claim 22 was representative:
Claim 22. An article of manufacture comprising:
a computer usable medium having computer readable program code means embodied therein for causing a polygon having a boundary definable by a plurality of selectable pels on a graphics display to be filled, the computer readable program code means in said article of manufacture comprising:
computer readable program code means for causing a computer to effect, with respect to one boundary line at a time, a sequential traverse of said plurality of selectable pels of each respective said boundary line;
computer readable program code means for causing the computer to store in an array during said traverse a value of an outer pel of said boundary of said plurality of selectable pels for each one of a plurality of scan lines of said polygon; and
computer readable program code means for causing the computer to draw a fill line, after said traverse, between said outer pels having said stored values, for each said one of said scan lines.
The USPTO Board rejected the claims using a variant of the printed matter rejection similar to that used in Lowry.
The California Multimedia and Software Patent Alliance filed a Amicus brief that asserted the following points, which were representative of the points raised by those who believed software patents were necessary:
The issue of whether a computer usable medium on which a particular piece of computer software is stored is protectable under the patent system is a particularly important one to the California multimedia and software industry for three reasons.
First, the copyright laws, perceived by many to be the most appropriate means for achieving protection of computer software, are inadequate. Under the abstraction/filtration/comparison test, which has been adopted in various forms by both the Ninth and Second Circuits as the appropriate method of defining the protectable aspects of computer software under the copyright laws, the ideas behind (or functions performed by) software are not protectable under the copyright laws. Thus, the scope of protection available is narrow and undefined.
Many other groups also filed Amicus briefs supporting Beauregard.
The Patent and Trademark Office filed a Motion to Dismiss stating that it was in agreement with the applicant that its claims recited statutory subject matter. The Federal Circuit noted that the parties were in agreement and that no case or controversy existed. The Federal Circuit vacated the Board of Appeals’s decision and remanded.
This was good news indeed for applicants.
In re Trovato, 1994
Just when it seemed like at least the Federal Circuit supported patents for software related inventions came the troubling case of In re Trovato.
The problem of finding the shortest distance between two points is a recurring one, and is of particular interest to students of the computer science field known as graph theory. Trovato's inventions work within this area, attempting to solve the "shortest path problem" by finding the optimal path between two locations, whether in terms of distance, cost, capacity, time or other criteria. The inventions model possible object movements in the real world--the "physical task space"--by a graph called a "configuration space." Each node of the graph represents a discrete state, or set of conditions, such as location or orientation. Edges connect the graph nodes and indicate the cost of transferring from one state to another.
Representative claims of the application included method claims 1 and 2, which recite:
1. A method for determining motion of an object comprising the steps of:
a) storing a configuration space data structure representing a physical task space, the configuration space data structure including representations of the object and its environment; and
b) propagating cost waves, in the configuration space data structure, to fill the configuration space data structure with cost values according to a space variant metric.
2. The method of claim 1, further comprising the steps of:
a) deriving a sequence of object pose representations within the configuration space data structure, using the cost values, which representations represent physical poses defining a least cost path from a start pose to a goal pose in the physical task space; and
b) providing a series in electronic form usable by the object to follow the path.
Claim 33 provides an example of an apparatus claim within the application:
33. Apparatus for planning a least cost path comprising:
a) means for storing a discretized representation of a physical task space;
b) means for assigning at least one respective cost to at least one neighboring position of any given position, based on
i) a cost assigned to the given position; and
ii) a measure which varies according to position within the discretized representation, so that a least cost path from the neighboring position to the given position is established;
c) means for starting the assigning means at a first position of known cost;
d) means for causing the assigning means to iterate, so that all positions within the discretized representation are assigned respective costs, in waves propagating outward from the first position; and
e) means for identifying a least cost path between two positions in the discretized representation based on the respective costs.
These claims were somewhat similar in style to those of Alappat. However, there was not as much detail in the specification as to the structure behind each means.
The court upheld application of the Freeman-Walter-Abele test.
The Federal Circuit found both method and machine claims to be unstatutory subject matter. and stated that Trovato's applications failed to explain how the claimed inventions actually employ the numbers to control movement, and that the absence of even a cursory description of how the computed values were implemented further indicated that the claimed methods comprised only numerical manipulation.
After this case, the best solution seemed to be to write claims to recite some sort of tangible product or to apply results to a physical solution, and to try to recite structure to better define respective means.
The problem of finding the shortest distance between two points is a recurring one, and is of particular interest to students of the computer science field known as graph theory. Trovato's inventions work within this area, attempting to solve the "shortest path problem" by finding the optimal path between two locations, whether in terms of distance, cost, capacity, time or other criteria. The inventions model possible object movements in the real world--the "physical task space"--by a graph called a "configuration space." Each node of the graph represents a discrete state, or set of conditions, such as location or orientation. Edges connect the graph nodes and indicate the cost of transferring from one state to another.
Representative claims of the application included method claims 1 and 2, which recite:
1. A method for determining motion of an object comprising the steps of:
a) storing a configuration space data structure representing a physical task space, the configuration space data structure including representations of the object and its environment; and
b) propagating cost waves, in the configuration space data structure, to fill the configuration space data structure with cost values according to a space variant metric.
2. The method of claim 1, further comprising the steps of:
a) deriving a sequence of object pose representations within the configuration space data structure, using the cost values, which representations represent physical poses defining a least cost path from a start pose to a goal pose in the physical task space; and
b) providing a series in electronic form usable by the object to follow the path.
Claim 33 provides an example of an apparatus claim within the application:
33. Apparatus for planning a least cost path comprising:
a) means for storing a discretized representation of a physical task space;
b) means for assigning at least one respective cost to at least one neighboring position of any given position, based on
i) a cost assigned to the given position; and
ii) a measure which varies according to position within the discretized representation, so that a least cost path from the neighboring position to the given position is established;
c) means for starting the assigning means at a first position of known cost;
d) means for causing the assigning means to iterate, so that all positions within the discretized representation are assigned respective costs, in waves propagating outward from the first position; and
e) means for identifying a least cost path between two positions in the discretized representation based on the respective costs.
These claims were somewhat similar in style to those of Alappat. However, there was not as much detail in the specification as to the structure behind each means.
The court upheld application of the Freeman-Walter-Abele test.
The Federal Circuit found both method and machine claims to be unstatutory subject matter. and stated that Trovato's applications failed to explain how the claimed inventions actually employ the numbers to control movement, and that the absence of even a cursory description of how the computed values were implemented further indicated that the claimed methods comprised only numerical manipulation.
After this case, the best solution seemed to be to write claims to recite some sort of tangible product or to apply results to a physical solution, and to try to recite structure to better define respective means.
18 February 2007
In re Lowry, 1994
Lowry’s patent application, titled “Data Processing System Having a Data Structure with a Single, Simple Primitive,” related to the storage, use, and management of information residing in a memory. The invention provided an efficient, flexible method of organizing stored data in a computer memory. A memory stores data according to a particular order or arrangement. Application programs use stored data to perform specified functions. A data model provides the framework for organizing and representing information used by an application program. Data models define permissible data structures – organizational structures imposed upon the data used by the application program – compatible with particular data processing systems.
Claims 1 through 5 claimed a memory containing a stored data structure. Claim 1 was representative:
1. A memory for storing data for access by an application program being executed on a data processing system, comprising:
a data structure stored in said memory, said data structure including information resident in a database used by said application program and including:
a plurality of attribute data objects stored in said memory, each of said attribute data objects containing different information from said database;
a single holder attribute data object for each of said attribute data objects, each of said holder attribute data objects being one of said plurality of attribute data objects, a being-held relationship existing between each attribute data object and its holder attribute data object, and each of said attribute data objects having a being-held relationship with only a single other attribute data object, thereby establishing a hierarchy of said plurality of attribute data objects;
a referent attribute data object for at least one of said attribute data objects, said referent attribute data object being nonhierarchically related to a holder attribute data object for the same at least one of said attribute data objects and also being one of said plurality of attribute data objects, attribute data objects for which there exist only holder attribute data objects being called element data objects, and attribute data objects for which there also exist referent attribute data objects being called relation data objects; and
an apex data object stored in said memory and having no being-held relationship with any of said attribute data objects, however, at least one of said attribute data objects having a being-held relationship with said apex data object.
Claims 6 through 19 claimed a data processing system executing an application program, containing a database, a central processing unit (CPU) means for processing the application program, and a memory means for holding the claimed data structure. Claims 20-23, 25, and 28 specified methods of accessing, creating, adding, and erasing ADOs within the data structure. Claim 24 specified a method for creating a data structure. Claims 26, 27, and 29 claimed methods of creating and erasing non-hierarchical relationships between ADOs and referent ADOs.
The USPTO Examiner rejected claims 1 through 5 under 35 U.S.C. Section 101 as non-statutory subject matter. The examiner also rejected claims 1 through 19 under 35 U.S.C. Section 103 as obvious in light of U.S. Patent No. 4,774,661 (Kumpati). Finally, the examiner rejected claims 20 through 29 under 35 U.S.C. Section 102(e) as anticipated by Kumpati. The Board reversed the 35 U.S.C. Section 101 rejection. The Board found that claims l through 5, directed to a memory containing stored information, as a whole, recited an article of manufacture. The Board concluded that the invention claimed in claims 1 through 5 was statutory subject matter. But when evaluating patentability under sections 102 and 103, the Board failed to give patentable weight to the claimed data structure. The Board stated that the claims on appeal specified relationships between the ADOs stored in the memory. The Board analogized Lowry’s data structure to printed matter and relied on this statement from In re Gulack, 703 F.2d 1381, 217 USPQ 401 (Fed. Cir. 1983):
Where the printed matter is not functionally related to the substrate, the printed matter will not distinguish the invention from the prior art in terms of patentability. Although the printed matter must be considered, in that situation it may not be entitled to patentable weight.
The Federal Circuit stated that the Board erroneously extended a printed matter rejection under sections 102 and 103 to a new field in this case, which involves information stored in a memory. The Federal Circuit stated that this case was distinguishable from the printed matter cases because the printed matter cases only “dealt with claims defining as the invention certain novel arrangements of printed lines or characters, useful and intelligible only to the human mind” and have no factual relevance where “the invention as defined by the claims requires that the information be processed not by the mind but by a machine, the computer.” Lowry’s data structures, which according to Lowry greatly facilitate data management by data processing systems, are processed by a machine. Indeed, they are not accessible other than through sophisticated software systems. The Federal Circuit concluded that printed matter cases have no factual relevance here, nor are the data structures analogous to printed matter. Lowry’s ADOs did not represent merely underlying data in a database. ADOs contain both information used by application programs and information regarding their physical interrelationships within a memory. Lowry’s claims dictated how application programs manage information. Thus, Lowry’s claims defined functional characteristics of the memory.
Contrary to the PTO’s assertion, Lowry did not claim merely the information content of a memory. Lowry’s data structures, while including data resident in a database, depended only functionally on information content. While the information content affects the exact sequence of bits stored in accordance with Lowry’s data structures, the claims required specific electronic structural elements which imparted a physical organization on the information stored in memory. Lowry’s invention managed information.
Lowry did not seek to patent the Attributive data model in the abstract. Nor did he seek to patent the content of information resident in a database. Rather, Lowry’s data structures imposed a physical organization on the data.
In Lowry’s invention, the stored data adopted no physical “structure” per se. Rather, the stored data existed as a collection of bits having information about relationships between the ADOs. According to the Federal Circuit, this is the essence of electronic Structure. More than mere abstraction, the data structures are specific electrical or magnetic structural elements in a memory. Lowry’s data structures were physical entities that provide increased efficiency in computer operation. They are not analogous to printed matter.
Even assuming that data objects and data structures are analogous to printed matter, the PTO did not establish that the ADOs, within the context of the entire claims, lacked a new and nonobvious functional relationship with the memory. The ADOs follow a particular sequence that enables more efficient data processing operations on stored data. The ADOs facilitate addition, deletion, and modification of information stored in the memory. In sum, the ADO’s perform a function. Gulack requires no more.
With the foregoing in mind, the court turned to the specific prior art rejections
and noted that the Kumpati reference did not disclose Lowry’s ADOs and their specific hierarchical and non-hierarchical relationships.
Lowry’s claimed invention involved an organization of information and its interrelationships which Kumpati neither discloses nor suggests. Kumpati also did not render Lowry’s claims obvious. The Federal Circuit held that the Board erred in holding otherwise. Claims 1 through 19 are, as a whole, were not obvious in light of Kumpati.
Because Kumpati does not contain all limitations of claims 20 through 29, the Board erred in holding these claims anticipated by Kumpati. Therefore, the Federal Circuit reversed the section 102 rejection of claims 20 through 29.
The Federal Circuit concluded that the Board erred by denying patentable weight to Lowry’s data structure limitations.
Claims 1 through 5 claimed a memory containing a stored data structure. Claim 1 was representative:
1. A memory for storing data for access by an application program being executed on a data processing system, comprising:
a data structure stored in said memory, said data structure including information resident in a database used by said application program and including:
a plurality of attribute data objects stored in said memory, each of said attribute data objects containing different information from said database;
a single holder attribute data object for each of said attribute data objects, each of said holder attribute data objects being one of said plurality of attribute data objects, a being-held relationship existing between each attribute data object and its holder attribute data object, and each of said attribute data objects having a being-held relationship with only a single other attribute data object, thereby establishing a hierarchy of said plurality of attribute data objects;
a referent attribute data object for at least one of said attribute data objects, said referent attribute data object being nonhierarchically related to a holder attribute data object for the same at least one of said attribute data objects and also being one of said plurality of attribute data objects, attribute data objects for which there exist only holder attribute data objects being called element data objects, and attribute data objects for which there also exist referent attribute data objects being called relation data objects; and
an apex data object stored in said memory and having no being-held relationship with any of said attribute data objects, however, at least one of said attribute data objects having a being-held relationship with said apex data object.
Claims 6 through 19 claimed a data processing system executing an application program, containing a database, a central processing unit (CPU) means for processing the application program, and a memory means for holding the claimed data structure. Claims 20-23, 25, and 28 specified methods of accessing, creating, adding, and erasing ADOs within the data structure. Claim 24 specified a method for creating a data structure. Claims 26, 27, and 29 claimed methods of creating and erasing non-hierarchical relationships between ADOs and referent ADOs.
The USPTO Examiner rejected claims 1 through 5 under 35 U.S.C. Section 101 as non-statutory subject matter. The examiner also rejected claims 1 through 19 under 35 U.S.C. Section 103 as obvious in light of U.S. Patent No. 4,774,661 (Kumpati). Finally, the examiner rejected claims 20 through 29 under 35 U.S.C. Section 102(e) as anticipated by Kumpati. The Board reversed the 35 U.S.C. Section 101 rejection. The Board found that claims l through 5, directed to a memory containing stored information, as a whole, recited an article of manufacture. The Board concluded that the invention claimed in claims 1 through 5 was statutory subject matter. But when evaluating patentability under sections 102 and 103, the Board failed to give patentable weight to the claimed data structure. The Board stated that the claims on appeal specified relationships between the ADOs stored in the memory. The Board analogized Lowry’s data structure to printed matter and relied on this statement from In re Gulack, 703 F.2d 1381, 217 USPQ 401 (Fed. Cir. 1983):
Where the printed matter is not functionally related to the substrate, the printed matter will not distinguish the invention from the prior art in terms of patentability. Although the printed matter must be considered, in that situation it may not be entitled to patentable weight.
The Federal Circuit stated that the Board erroneously extended a printed matter rejection under sections 102 and 103 to a new field in this case, which involves information stored in a memory. The Federal Circuit stated that this case was distinguishable from the printed matter cases because the printed matter cases only “dealt with claims defining as the invention certain novel arrangements of printed lines or characters, useful and intelligible only to the human mind” and have no factual relevance where “the invention as defined by the claims requires that the information be processed not by the mind but by a machine, the computer.” Lowry’s data structures, which according to Lowry greatly facilitate data management by data processing systems, are processed by a machine. Indeed, they are not accessible other than through sophisticated software systems. The Federal Circuit concluded that printed matter cases have no factual relevance here, nor are the data structures analogous to printed matter. Lowry’s ADOs did not represent merely underlying data in a database. ADOs contain both information used by application programs and information regarding their physical interrelationships within a memory. Lowry’s claims dictated how application programs manage information. Thus, Lowry’s claims defined functional characteristics of the memory.
Contrary to the PTO’s assertion, Lowry did not claim merely the information content of a memory. Lowry’s data structures, while including data resident in a database, depended only functionally on information content. While the information content affects the exact sequence of bits stored in accordance with Lowry’s data structures, the claims required specific electronic structural elements which imparted a physical organization on the information stored in memory. Lowry’s invention managed information.
Lowry did not seek to patent the Attributive data model in the abstract. Nor did he seek to patent the content of information resident in a database. Rather, Lowry’s data structures imposed a physical organization on the data.
In Lowry’s invention, the stored data adopted no physical “structure” per se. Rather, the stored data existed as a collection of bits having information about relationships between the ADOs. According to the Federal Circuit, this is the essence of electronic Structure. More than mere abstraction, the data structures are specific electrical or magnetic structural elements in a memory. Lowry’s data structures were physical entities that provide increased efficiency in computer operation. They are not analogous to printed matter.
Even assuming that data objects and data structures are analogous to printed matter, the PTO did not establish that the ADOs, within the context of the entire claims, lacked a new and nonobvious functional relationship with the memory. The ADOs follow a particular sequence that enables more efficient data processing operations on stored data. The ADOs facilitate addition, deletion, and modification of information stored in the memory. In sum, the ADO’s perform a function. Gulack requires no more.
With the foregoing in mind, the court turned to the specific prior art rejections
and noted that the Kumpati reference did not disclose Lowry’s ADOs and their specific hierarchical and non-hierarchical relationships.
Lowry’s claimed invention involved an organization of information and its interrelationships which Kumpati neither discloses nor suggests. Kumpati also did not render Lowry’s claims obvious. The Federal Circuit held that the Board erred in holding otherwise. Claims 1 through 19 are, as a whole, were not obvious in light of Kumpati.
Because Kumpati does not contain all limitations of claims 20 through 29, the Board erred in holding these claims anticipated by Kumpati. Therefore, the Federal Circuit reversed the section 102 rejection of claims 20 through 29.
The Federal Circuit concluded that the Board erred by denying patentable weight to Lowry’s data structure limitations.
In re Warmerdam, 1994
Warmerdam's patent application was directed to a method and apparatus for controlling the motion robotic machines to avoid collisions.
The technique required determining the shape and position of the edges of the objects to be avoided. The prior art taught that collision avoidance operations could be simplified by assuming that the objects were larger and more regularly shaped than they actually were. This could be done by treating the object as if it were a circle or sphere (called a "bubble") of sufficient size to enclose the object, and by assuming that any motion that impinged upon the circle would have produced a collision. Appellants' invention claimed a further refinement of prior art bubble systems. The positions of objects were determined by measuring the locations of artificial circular boundaries, but the measurement process did not end if the machine determines that the circular boundary will be violated in a potential collision. Instead, if a potential collision was detected, appellants further refined the determination of the boundary position by replacing the spherical bubble zone with a set of smaller, more refined bubble zones. Appellants referred to their set of increasingly better defined safety zones as a bubble hierarchy. Warmerdam conceded that the use of bubble hierarchies for collision avoidance was known. The asserted novelty of Warmerdam's method and apparatus was the generation and placement of the hierarchy of bubbles along the medial axis of the object. The medial axis of an object was defined in the specification to be a line with the same topology as the object itself connecting points which lay midway between boundary centers of the object.
As filed, the application contained seven claims of which only claims 1-6 were at issue in the case. The other claim, claim 7, was indicated by the examiner as allowable. Claims 1-4 were method claims, of which claim 1 was the sole independent claim:
1. A method for generating a data structure which represents the shape of [sic] physical object in a position and/or motion control machine as a hierarchy of bubbles, comprising the steps of:
first locating the medial axis of the object and
then creating a hierarchy of bubbles on the medial axis.
Claim 5 was directed to a machine:
5. A machine having a memory which contains data representing a bubble hierarchy generated by the method of any of Claims 1 through 4.
Claim 6 was directed to a data structure:
6. A data structure generated by the method of any of Claims 1 through 4.
The Federal Circuit noted that the statute equates the term "method" with the term "process," see 35 U.S.C. Section 100(b), the question becomes what is it that this process does, and in doing it is it other than what the Supreme Court must have understood to be "laws of nature, natural phenomena or abstract ideas"?
The Board concluded that each of the two steps recited in claim 1, involved the solving of a mathematical algorithm. The Commissioner asserted that these conclusions are sustainable on the ground that the preferred method of locating a medial axis identified in the specification was a mathematical procedure known as Hilditch Skeletonization method, and on the ground that the top-down and bottom-up procedures identified in the specification (and claimed in the dependent claims) for creating the bubble hierarchy were likewise mathematical in nature. The Commissioner also pointed to several cases3 in which process steps similar to those recited in claims 1-4, i.e., steps such as computing, determining, cross-correlating, comparing, selecting, initializing, testing, modifying, and identifying, were found to implicitly recite the solving of a mathematical algorithm.
Warmerdam, by contrast, argued that the claims were broad enough to cover methods which involve physically measuring the contour of the object. Thus, according to Warmerdam, the claims did not essentially recite a mathematical algorithm, but only incidentally do so.
The Federal Circuit agreed, and stated that Claim 1 was broad enough to cover methods for locating the medial axis of an object that include physically measuring the contour of the object with a ruler or simply by eyeballing the object, and then creating the bubble hierarchy by manually drawing it. In that sense, it did not necessarily recite the solving of a mathematical algorithm. The fact that the claim covered methods which are essentially mathematical in nature, as discussed infra, is not dispositive. Claims should be evaluated by their limitations, not by what they incidentally cover.
On the other hand, the preferred, and the only practical, embodiment of the claimed method involves steps which are essentially mathematical in nature, i.e., utilization of the Hilditch Skeletonization method to locate the medial axis, followed by utilization of a top-down or bottom-up procedure for creating the bubble hierarchy. In this sense, at least, the claim is mathematical in nature.
The Federal Circuit declined to resolve the issue of the definition of "mathematical algorithm," because they found that regardless whether the claim can be said to recite indirectly or directly a mathematical algorithm, the dispositive issue for assessing compliance with Section 101 in this case is whether the claim is for a process that goes beyond simply manipulating "abstract ideas" or "natural phenomena."
The Federal Circuit noted that claim 1 recited the steps of "locating" a medial axis, and "creating" a bubble hierarchy and concluded that these steps described nothing more than the manipulation of basic mathematical constructs, the paradigmatic "abstract idea" and noted that, as the Supreme Court has made clear, [a]n idea of itself is not patentable, Rubber-Tip Pencil Co. v. Howard, 20 U.S. (1 Wall.) 498, 507 (1874); taking several abstract ideas and manipulating them together adds nothing to the basic equation.
Warmerdam's argument that the claim implies physically measuring the contour of an object missed the point. As a whole, the claim involved no more than the manipulation of abstract ideas. Moreover, from the standpoint of Section 101, a physical measurement step is indistinguishable from the data gathering step which, as was held in In re Grams, 888 F.2d 835, 12 USPQ2d 1824 (Fed. Cir. 1989), was insufficient, standing alone, to impart patentability to a claim.
Warmerdam's other argument, that the manipulation of data as described in the claims constitutes or represents a sufficient level of physical activity to impart patentability to the claim, was not convincing. The problem with Warmerdam's argument was that the claims here did not have the effect of requiring more than the manipulation of ideas. The Federal Circuit thus concluded that the Board did not err in sustaining the rejection of claims 1-4 under Section 101.
The Federal Circuit then noted that Claim 5 was for a machine, and was clearly patentable subject matter. The Board denied patentability on the grounds it was indefinite under 35 U.S.C. Section 112, second paragraph and was not in conventional product-by-process format, and the Commissioner repeated this assertion. Warmerdam argued that claim 5 conforms to the conventional product- by-process format, and thus is definite. The Commissioner argued that it was unclear how a memory is produced by the steps recited in claims 1-4. Second, the Commissioner argued that the bubble hierarchy which was created in the recited steps was not an exact, well-defined data structure.
The Federal Circuit noted that the legal standard for definiteness is whether a claim reasonably apprises those of skill in the art of its scope, and then concluded that
Claim 5 satisfies this test. It covers any machine (presumably including a known computer) having a memory which contains any data representing a bubble hierarchy determined by any of the methods of claims 1-4. The Federal Circuit stated that there is no requirement that a claim for a machine which incorporates process steps, such as claim 5, must conform to the conventional definition of a product-by-process claim.
The Federal Circuit stated that the ideas expressed in claims 1 through 4 are well known mathematical constructs, and lend themselves to manipulation through known computer technology. There was no showing that one skilled in the art would have had any particular difficulty in determining whether a machine having a memory containing data representing a bubble hierarchy was or was not within the scope of claim 5. The Board's point, that the claim leaves unclear the technique of how the memory was configured with the data, had no bearing on this issue. The claim plainly covered all such techniques. The Federal Circuit concluded the Board erred in sustaining the rejection of claim 5 for indefiniteness.
The Court then concluded that the data structure claim was non-statutory. Warmerdam argued that a data structure was one of the categories of patentable subject matter recited in Section 101, and thus that the Board erred in sustaining the rejection of claim 6 under Section 101. The Commissioner, by contrast, citing Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470 (1974), argued that the rejection should be sustained because the claim is not one of the categories of subject matter recited in Section 101, to wit, a process, machine, manufacture, composition of matter, or an improvement thereof. The Federal Circuit agreed with the Commissioner. In the IEEE Standard Computer Dictionary (1991), the phrase "data structure" is defined as [a] physical or logical relationship among data elements, designed to support specific data manipulation functions. Since the "data structure" of claim 6 was nothing more than another way of describing the manipulation of ideas contained in claims 1-4, it suffered from the same fatal defect they did, according to the Federal Circuit.
The technique required determining the shape and position of the edges of the objects to be avoided. The prior art taught that collision avoidance operations could be simplified by assuming that the objects were larger and more regularly shaped than they actually were. This could be done by treating the object as if it were a circle or sphere (called a "bubble") of sufficient size to enclose the object, and by assuming that any motion that impinged upon the circle would have produced a collision. Appellants' invention claimed a further refinement of prior art bubble systems. The positions of objects were determined by measuring the locations of artificial circular boundaries, but the measurement process did not end if the machine determines that the circular boundary will be violated in a potential collision. Instead, if a potential collision was detected, appellants further refined the determination of the boundary position by replacing the spherical bubble zone with a set of smaller, more refined bubble zones. Appellants referred to their set of increasingly better defined safety zones as a bubble hierarchy. Warmerdam conceded that the use of bubble hierarchies for collision avoidance was known. The asserted novelty of Warmerdam's method and apparatus was the generation and placement of the hierarchy of bubbles along the medial axis of the object. The medial axis of an object was defined in the specification to be a line with the same topology as the object itself connecting points which lay midway between boundary centers of the object.
As filed, the application contained seven claims of which only claims 1-6 were at issue in the case. The other claim, claim 7, was indicated by the examiner as allowable. Claims 1-4 were method claims, of which claim 1 was the sole independent claim:
1. A method for generating a data structure which represents the shape of [sic] physical object in a position and/or motion control machine as a hierarchy of bubbles, comprising the steps of:
first locating the medial axis of the object and
then creating a hierarchy of bubbles on the medial axis.
Claim 5 was directed to a machine:
5. A machine having a memory which contains data representing a bubble hierarchy generated by the method of any of Claims 1 through 4.
Claim 6 was directed to a data structure:
6. A data structure generated by the method of any of Claims 1 through 4.
The Federal Circuit noted that the statute equates the term "method" with the term "process," see 35 U.S.C. Section 100(b), the question becomes what is it that this process does, and in doing it is it other than what the Supreme Court must have understood to be "laws of nature, natural phenomena or abstract ideas"?
The Board concluded that each of the two steps recited in claim 1, involved the solving of a mathematical algorithm. The Commissioner asserted that these conclusions are sustainable on the ground that the preferred method of locating a medial axis identified in the specification was a mathematical procedure known as Hilditch Skeletonization method, and on the ground that the top-down and bottom-up procedures identified in the specification (and claimed in the dependent claims) for creating the bubble hierarchy were likewise mathematical in nature. The Commissioner also pointed to several cases3 in which process steps similar to those recited in claims 1-4, i.e., steps such as computing, determining, cross-correlating, comparing, selecting, initializing, testing, modifying, and identifying, were found to implicitly recite the solving of a mathematical algorithm.
Warmerdam, by contrast, argued that the claims were broad enough to cover methods which involve physically measuring the contour of the object. Thus, according to Warmerdam, the claims did not essentially recite a mathematical algorithm, but only incidentally do so.
The Federal Circuit agreed, and stated that Claim 1 was broad enough to cover methods for locating the medial axis of an object that include physically measuring the contour of the object with a ruler or simply by eyeballing the object, and then creating the bubble hierarchy by manually drawing it. In that sense, it did not necessarily recite the solving of a mathematical algorithm. The fact that the claim covered methods which are essentially mathematical in nature, as discussed infra, is not dispositive. Claims should be evaluated by their limitations, not by what they incidentally cover.
On the other hand, the preferred, and the only practical, embodiment of the claimed method involves steps which are essentially mathematical in nature, i.e., utilization of the Hilditch Skeletonization method to locate the medial axis, followed by utilization of a top-down or bottom-up procedure for creating the bubble hierarchy. In this sense, at least, the claim is mathematical in nature.
The Federal Circuit declined to resolve the issue of the definition of "mathematical algorithm," because they found that regardless whether the claim can be said to recite indirectly or directly a mathematical algorithm, the dispositive issue for assessing compliance with Section 101 in this case is whether the claim is for a process that goes beyond simply manipulating "abstract ideas" or "natural phenomena."
The Federal Circuit noted that claim 1 recited the steps of "locating" a medial axis, and "creating" a bubble hierarchy and concluded that these steps described nothing more than the manipulation of basic mathematical constructs, the paradigmatic "abstract idea" and noted that, as the Supreme Court has made clear, [a]n idea of itself is not patentable, Rubber-Tip Pencil Co. v. Howard, 20 U.S. (1 Wall.) 498, 507 (1874); taking several abstract ideas and manipulating them together adds nothing to the basic equation.
Warmerdam's argument that the claim implies physically measuring the contour of an object missed the point. As a whole, the claim involved no more than the manipulation of abstract ideas. Moreover, from the standpoint of Section 101, a physical measurement step is indistinguishable from the data gathering step which, as was held in In re Grams, 888 F.2d 835, 12 USPQ2d 1824 (Fed. Cir. 1989), was insufficient, standing alone, to impart patentability to a claim.
Warmerdam's other argument, that the manipulation of data as described in the claims constitutes or represents a sufficient level of physical activity to impart patentability to the claim, was not convincing. The problem with Warmerdam's argument was that the claims here did not have the effect of requiring more than the manipulation of ideas. The Federal Circuit thus concluded that the Board did not err in sustaining the rejection of claims 1-4 under Section 101.
The Federal Circuit then noted that Claim 5 was for a machine, and was clearly patentable subject matter. The Board denied patentability on the grounds it was indefinite under 35 U.S.C. Section 112, second paragraph and was not in conventional product-by-process format, and the Commissioner repeated this assertion. Warmerdam argued that claim 5 conforms to the conventional product- by-process format, and thus is definite. The Commissioner argued that it was unclear how a memory is produced by the steps recited in claims 1-4. Second, the Commissioner argued that the bubble hierarchy which was created in the recited steps was not an exact, well-defined data structure.
The Federal Circuit noted that the legal standard for definiteness is whether a claim reasonably apprises those of skill in the art of its scope, and then concluded that
Claim 5 satisfies this test. It covers any machine (presumably including a known computer) having a memory which contains any data representing a bubble hierarchy determined by any of the methods of claims 1-4. The Federal Circuit stated that there is no requirement that a claim for a machine which incorporates process steps, such as claim 5, must conform to the conventional definition of a product-by-process claim.
The Federal Circuit stated that the ideas expressed in claims 1 through 4 are well known mathematical constructs, and lend themselves to manipulation through known computer technology. There was no showing that one skilled in the art would have had any particular difficulty in determining whether a machine having a memory containing data representing a bubble hierarchy was or was not within the scope of claim 5. The Board's point, that the claim leaves unclear the technique of how the memory was configured with the data, had no bearing on this issue. The claim plainly covered all such techniques. The Federal Circuit concluded the Board erred in sustaining the rejection of claim 5 for indefiniteness.
The Court then concluded that the data structure claim was non-statutory. Warmerdam argued that a data structure was one of the categories of patentable subject matter recited in Section 101, and thus that the Board erred in sustaining the rejection of claim 6 under Section 101. The Commissioner, by contrast, citing Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470 (1974), argued that the rejection should be sustained because the claim is not one of the categories of subject matter recited in Section 101, to wit, a process, machine, manufacture, composition of matter, or an improvement thereof. The Federal Circuit agreed with the Commissioner. In the IEEE Standard Computer Dictionary (1991), the phrase "data structure" is defined as [a] physical or logical relationship among data elements, designed to support specific data manipulation functions. Since the "data structure" of claim 6 was nothing more than another way of describing the manipulation of ideas contained in claims 1-4, it suffered from the same fatal defect they did, according to the Federal Circuit.
In re Alappat, 1994
This case went a long way towards making it possible to obtain patents on software-related inventions, at least for apparatus claims drafted in means-plus-function format, and if digital hardware equivalents were disclosed in the specification. Specific hardware structures were disclosed in the specification, but the Federal Circuit held that the claim could also read on a general purpose computer programmed to carry out the invention, without a 35 U.S.C. 101 problem.
Alappat’s invention related generally to a means for creating a smooth waveform display in a digital oscilloscope. The screen of an oscilloscope was the front of a cathode-ray tube (CRT), whose screen presented an array (or raster) of pixels arranged at intersections of vertical columns and horizontal rows. Each column in the array represented a different time period, and each row represented a different magnitude. An input signal to the oscilloscope was sampled and digitized to provide a waveform data sequence (vector list), wherein each successive element of the sequence represented the magnitude of the waveform at a successively later time. The waveform data sequence was then processed to provide a bit map, which was a stored data array indicating which pixels are to be illuminated. The waveform ultimately displayed was formed by a group of vectors, wherein each vector has a straight line trajectory between two points on the screen at elevations representing the magnitudes of two successive input signal samples and at horizontal positions representing the timing of the two samples. Because a CRT screen contains a finite number of pixels, rapidly rising and falling portions of a waveform can appear discontinuous or jagged. In addition, the presence of “noise” in an input signal can cause portions of the waveform to oscillate between contiguous pixel rows when the magnitude of the input signal lies between values represented by the elevations of the two rows. Moreover, the vertical resolution of the display may be limited by the number of rows of pixels on the screen. The noticeability and appearance of these effects is known as aliasing. To overcome these effects, Alappat’s invention employed an anti-aliasing system wherein each vector making up the waveform is represented by modulating the illumination intensity of pixels having center points bounding the trajectory of the vector. The intensity at which each of the pixels was illuminated depended upon the distance of the center point of each pixel from the trajectory of the vector. Pixels lying squarely on the waveform trace received maximum illumination, whereas pixels lying along an edge of the trace received illumination decreasing in intensity proportional to the increase in the distance of the center point of the pixel from the vector trajectory. Employing this anti-aliasing technique eliminates any apparent discontinuity, jaggedness, or oscillation in the waveform, thus giving the visual appearance of a smooth continuous waveform.
Claim 15, the only independent claim in issue at the Federal Circuit, read:
A rasterizer for converting vector list data representing sample magnitudes of an input waveform into anti-aliased pixel illumination intensity data to be displayed on a display means comprising:
(a) means for determining the vertical distance between the endpoints of each of the vectors in the data list;
(b) means for determining the elevation of a row of pixels that is spanned by the vector;
(c) means for normalizing the vertical distance and elevation; and
(d) means for outputting illumination intensity data as a predetermined function of the normalized vertical distance and elevation.
The USPTO Examiner finally rejected claims under 35 U.S.C. Section 101 as being directed to non-statutory subject matter. Alappat appealed this rejection to the Board, and a three-member panel reversed the Examiner’s non-statutory subject matter rejection. The Examiner then requested reconsideration of this decision, stating that the panel’s decision conflicted with PTO policy. The Examiner further requested that such reconsideration be carried out by an expanded panel.
An expanded panel reconsidered the decision. The expanded panel was made up of eight members including the PTO Commissioner, the PTO Deputy Commissioner, the PTO Assistant Commissioner, the Board Chairman, the Board Vice-Chairman, and the three members of the original panel. This seemed like "board stacking." The expanded eight-member panel affirmed the Examiner’s Section 101 rejection, ruling contrary to the decision of the original three-member panel. The expanded panel had held that the independent apparatus claim, which was written in "means-plus-function" language, was merely a process claim wherein each element represented a step in that process. The panel reasoned that the claim was broad enough to cover an appropriately programmed general purpose computer and, therefore, held that the claimed process was a "mathematical algorithm" which was not eligible for patent protection. The three members of the original panel dissented.
The Federal Circuit first considered the following question: When a three-member panel of the Board has rendered its decision, does the Commissioner have the authority to constitute a new panel for purposes of reconsideration? The Federal Circuit held that the answer to this first question was Yes. The Federal Circuit noted that 35 U.S.C. Section 7 (a) plainly and unambiguously provides that the Commissioner, the Deputy Commissioner, and the Assistant Commissioners are members of the Board. Section 7(b) plainly and unambiguously requires that the Commissioner designate “at least three” Board members to hear each appeal. By use of the language “at least three,” Congress expressly granted the Commissioner the authority to designate expanded Board panels made up of more than three Board members. There was no evidence in the legislative history of Section 7, or Title 35 as a whole, clearly indicating that Congress intended to impose any statutory limitations regarding which Board members the Commissioner may appoint to an expanded panel or when the Commissioner may convene such a panel. The last sentence of Section 7(b) provided: “Only the Board of Patent Appeals and Interferences has the authority to grant rehearings.” The Commissioner contended that the reconsideration action taken in this case constituted a type of “rehearing” as mentioned in the last sentence of Section 7(b). The Federal Circuit found the Commissioner’s interpretation of Section 7 to have been a reasonable one entitled to deference, given that neither the statute itself nor the legislative history thereof indicated Congressional intent to the contrary. The fact that Section 7 referred to “rehearings” whereas 37 C.F.R. 1.197 (PTO Rule 197) referred to “reconsideration” was of no significance. The differing terminology appeared to be nothing more than the result of imprecise regulation drafting.
The Federal Circuit then turned to the merits of the case.
The majority opinion, by Judge Rich, joined by Judges Newman, Lourie, Michel, Plager and Rader, reversed the expanded panel's decision.
The majority stated that the reconsideration panel erred by refusing to interpret the means-for-function clauses properly. These clauses related to specific structures disclosed in the specification – two ALUs, two barrel shifters, and a ROM – and their equivalents, and that the original panel was correct in its construction of claim 15. Thus, pursuant to Section 112, Para. 6, and in view of the specification, the claims did recite specific digital circuitry structures. The majority concluded that because the claim recites connected structures, the claim “unquestionably recites a machine.”
The majority went further and stated that Finally, the court concludes that if the claimed “rasterizer” were equivalent to a “general purpose digital computer” programmed to perform the calculations performed by the rasterizer, such programmed computer would be the invention of a “new machine” within Section 101.
A dissent by Chief Judge Archer, joined by Judge Nies, characterized Alappat's invention as "newly discovered mathematics and not the invention or discovery of a process or product applying it."
Judge Newman, concurring, noted that:
Old law is often adapted to new needs: “If Congress has made a choice of language which fairly brings a given situation within a statute, it is unimportant that the particular application may not have been contemplated by the legislators.” Barr v. United States, 324 U.S. 83, 90 (1945). In Diamond v. Chakrabarty, 447 U.S. 303, 206 USPQ 193 (1980) the Court emphasized that the patent system is available to serve all fruits of human ingenuity.
In an address before the Economic Club of Detroit, Irving S. Shapiro, Chairman, E.I. duPont de Nemours & Co., discussing “Technology’s Decline”, stated:
What seems to be missing in our country is an understanding that, no matter how much money we spend on research and development, the findings are not going to benefit the public unless there are suitable incentives to invest in commercialization. That means a chance of reasonable profits from risk taking and a chance to hold onto one’s original ideas once they are created.
XLV Vital Speeches of the Day, 360, 364 (1979). To bar such inventions as Alappat’s rasterizer from access to the patent system is to eliminate the incentive provided by this law, disserving not only technological industry, but the public benefit of improved technology. One must have a powerful reason to exclude technology from the scope of Title 35. Indeed, the importance of the patent incentive in industrial innovation was the principal factor in the formation of the Federal Circuit. It is thus appropriate constructively to apply statute, precedent, and policy to the variety of inventions that the information age has generated, and to remove the cloud on whether these inventions may participate in the benefits and obligations of the patent system.
Alappat’s invention related generally to a means for creating a smooth waveform display in a digital oscilloscope. The screen of an oscilloscope was the front of a cathode-ray tube (CRT), whose screen presented an array (or raster) of pixels arranged at intersections of vertical columns and horizontal rows. Each column in the array represented a different time period, and each row represented a different magnitude. An input signal to the oscilloscope was sampled and digitized to provide a waveform data sequence (vector list), wherein each successive element of the sequence represented the magnitude of the waveform at a successively later time. The waveform data sequence was then processed to provide a bit map, which was a stored data array indicating which pixels are to be illuminated. The waveform ultimately displayed was formed by a group of vectors, wherein each vector has a straight line trajectory between two points on the screen at elevations representing the magnitudes of two successive input signal samples and at horizontal positions representing the timing of the two samples. Because a CRT screen contains a finite number of pixels, rapidly rising and falling portions of a waveform can appear discontinuous or jagged. In addition, the presence of “noise” in an input signal can cause portions of the waveform to oscillate between contiguous pixel rows when the magnitude of the input signal lies between values represented by the elevations of the two rows. Moreover, the vertical resolution of the display may be limited by the number of rows of pixels on the screen. The noticeability and appearance of these effects is known as aliasing. To overcome these effects, Alappat’s invention employed an anti-aliasing system wherein each vector making up the waveform is represented by modulating the illumination intensity of pixels having center points bounding the trajectory of the vector. The intensity at which each of the pixels was illuminated depended upon the distance of the center point of each pixel from the trajectory of the vector. Pixels lying squarely on the waveform trace received maximum illumination, whereas pixels lying along an edge of the trace received illumination decreasing in intensity proportional to the increase in the distance of the center point of the pixel from the vector trajectory. Employing this anti-aliasing technique eliminates any apparent discontinuity, jaggedness, or oscillation in the waveform, thus giving the visual appearance of a smooth continuous waveform.
Claim 15, the only independent claim in issue at the Federal Circuit, read:
A rasterizer for converting vector list data representing sample magnitudes of an input waveform into anti-aliased pixel illumination intensity data to be displayed on a display means comprising:
(a) means for determining the vertical distance between the endpoints of each of the vectors in the data list;
(b) means for determining the elevation of a row of pixels that is spanned by the vector;
(c) means for normalizing the vertical distance and elevation; and
(d) means for outputting illumination intensity data as a predetermined function of the normalized vertical distance and elevation.
The USPTO Examiner finally rejected claims under 35 U.S.C. Section 101 as being directed to non-statutory subject matter. Alappat appealed this rejection to the Board, and a three-member panel reversed the Examiner’s non-statutory subject matter rejection. The Examiner then requested reconsideration of this decision, stating that the panel’s decision conflicted with PTO policy. The Examiner further requested that such reconsideration be carried out by an expanded panel.
An expanded panel reconsidered the decision. The expanded panel was made up of eight members including the PTO Commissioner, the PTO Deputy Commissioner, the PTO Assistant Commissioner, the Board Chairman, the Board Vice-Chairman, and the three members of the original panel. This seemed like "board stacking." The expanded eight-member panel affirmed the Examiner’s Section 101 rejection, ruling contrary to the decision of the original three-member panel. The expanded panel had held that the independent apparatus claim, which was written in "means-plus-function" language, was merely a process claim wherein each element represented a step in that process. The panel reasoned that the claim was broad enough to cover an appropriately programmed general purpose computer and, therefore, held that the claimed process was a "mathematical algorithm" which was not eligible for patent protection. The three members of the original panel dissented.
The Federal Circuit first considered the following question: When a three-member panel of the Board has rendered its decision, does the Commissioner have the authority to constitute a new panel for purposes of reconsideration? The Federal Circuit held that the answer to this first question was Yes. The Federal Circuit noted that 35 U.S.C. Section 7 (a) plainly and unambiguously provides that the Commissioner, the Deputy Commissioner, and the Assistant Commissioners are members of the Board. Section 7(b) plainly and unambiguously requires that the Commissioner designate “at least three” Board members to hear each appeal. By use of the language “at least three,” Congress expressly granted the Commissioner the authority to designate expanded Board panels made up of more than three Board members. There was no evidence in the legislative history of Section 7, or Title 35 as a whole, clearly indicating that Congress intended to impose any statutory limitations regarding which Board members the Commissioner may appoint to an expanded panel or when the Commissioner may convene such a panel. The last sentence of Section 7(b) provided: “Only the Board of Patent Appeals and Interferences has the authority to grant rehearings.” The Commissioner contended that the reconsideration action taken in this case constituted a type of “rehearing” as mentioned in the last sentence of Section 7(b). The Federal Circuit found the Commissioner’s interpretation of Section 7 to have been a reasonable one entitled to deference, given that neither the statute itself nor the legislative history thereof indicated Congressional intent to the contrary. The fact that Section 7 referred to “rehearings” whereas 37 C.F.R. 1.197 (PTO Rule 197) referred to “reconsideration” was of no significance. The differing terminology appeared to be nothing more than the result of imprecise regulation drafting.
The Federal Circuit then turned to the merits of the case.
The majority opinion, by Judge Rich, joined by Judges Newman, Lourie, Michel, Plager and Rader, reversed the expanded panel's decision.
The majority stated that the reconsideration panel erred by refusing to interpret the means-for-function clauses properly. These clauses related to specific structures disclosed in the specification – two ALUs, two barrel shifters, and a ROM – and their equivalents, and that the original panel was correct in its construction of claim 15. Thus, pursuant to Section 112, Para. 6, and in view of the specification, the claims did recite specific digital circuitry structures. The majority concluded that because the claim recites connected structures, the claim “unquestionably recites a machine.”
The majority went further and stated that Finally, the court concludes that if the claimed “rasterizer” were equivalent to a “general purpose digital computer” programmed to perform the calculations performed by the rasterizer, such programmed computer would be the invention of a “new machine” within Section 101.
A dissent by Chief Judge Archer, joined by Judge Nies, characterized Alappat's invention as "newly discovered mathematics and not the invention or discovery of a process or product applying it."
Judge Newman, concurring, noted that:
Old law is often adapted to new needs: “If Congress has made a choice of language which fairly brings a given situation within a statute, it is unimportant that the particular application may not have been contemplated by the legislators.” Barr v. United States, 324 U.S. 83, 90 (1945). In Diamond v. Chakrabarty, 447 U.S. 303, 206 USPQ 193 (1980) the Court emphasized that the patent system is available to serve all fruits of human ingenuity.
In an address before the Economic Club of Detroit, Irving S. Shapiro, Chairman, E.I. duPont de Nemours & Co., discussing “Technology’s Decline”, stated:
What seems to be missing in our country is an understanding that, no matter how much money we spend on research and development, the findings are not going to benefit the public unless there are suitable incentives to invest in commercialization. That means a chance of reasonable profits from risk taking and a chance to hold onto one’s original ideas once they are created.
XLV Vital Speeches of the Day, 360, 364 (1979). To bar such inventions as Alappat’s rasterizer from access to the patent system is to eliminate the incentive provided by this law, disserving not only technological industry, but the public benefit of improved technology. One must have a powerful reason to exclude technology from the scope of Title 35. Indeed, the importance of the patent incentive in industrial innovation was the principal factor in the formation of the Federal Circuit. It is thus appropriate constructively to apply statute, precedent, and policy to the variety of inventions that the information age has generated, and to remove the cloud on whether these inventions may participate in the benefits and obligations of the patent system.
17 February 2007
In re Schrader, 1994
Schrader's application was directed to a method for competitively bidding on a plurality of related items, such as contiguous tracts of land or the like. After the items have been offered to bidders, bids on one, some, or all of the items are received and entered into a “record.” Then, the combination of winning bids is determined by assembling a “completion” from all the entered bids. A completion is the particular combination of bids which “would complete a sale of all of the items being offered at the highest offered total price.” The items are then sold in accordance with the “completion.”
For example, in an auction involving two contiguous tracts of land, tracts 1 and 2, the following bids might be received and recorded: Bid 1 – $100,000 for tract 1 by bidder A; Bid 2 – $200,000 for tract 2 by bidder B; and Bid 3 – $250,000 for both tracts 1 and 2 by bidder C. The combination of bids that maximizes the revenue to the seller, and thus the combination of bids that forms the “completion,” would be bids 1 and 2.
Schrader claimed that his method constitutes a novel way of conducting auctions. According to Schrader, the type of bids that are normally offered at auctions is dictated solely by the way in which the auctioneer organizes or groups the items to be sold. Through his method, claims Schrader, bids on any combination of the items being auctioned off are offered at the discretion of the bidder. The purported benefit is greater sales revenue or profit to the seller. This is illustrated by the previous example, in which bids were offered on each of the individual tracts as well as on both tracts together. As a result, the seller attained total sales revenue of $300,000. If the seller had only been offered bids on the combined tracts, i.e., Bid 3, the seller would have derived $250,000 in revenue.
Claim 1 was representative:
1. A method of competitively bidding on a plurality of items comprising the steps of identifying a plurality of related items in a record, offering said plurality of items to a plurality of potential bidders, receiving bids from said bidders for both individual ones of said items and a plurality of groups of said items, each of said groups including one or more of said items, said items and groups being any number of all of said individual ones and all of the possible combinations of said items, entering said bids in said record, indexing each of said bids to one of said individual ones or said groups of said items, and assembling a completion of all said bids on said items and groups, said completion identifying a bid for all of said items at a prevailing total price, identifying in said record all of said bids corresponding to said prevailing total price.
During prosecution, the examiner rejected the claims for lack of statutory subject matter under 35 U.S.C. Section 101. After this rejection was made final, Schrader appealed to the Board. On appeal, the Board sustained the rejection on three different grounds.
Schrader appealed to the Federal Circuit and argued that the Board incorrectly invoked the rule that a patent cannot be obtained for a mathematical algorithm in the abstract.
Schrader’s first point was that there was no mathematical algorithm implicit in the claim. The Federal Circuit disagreed. Benson defined a “mathematical algorithm” for purposes of Section 101 as a “procedure for solving a given type of mathematical problem... .” The claim language “assembling a completion” is such a procedure because it describes the solving of a mathematical problem: determining the optimal combination of bids. This conclusion is supported by an admission in Schrader’s brief that the following two-step mathematical process is inherent in the phrase:
Perform a mathematical calculation which
a)determines possible combinations of items and/or groups with the provision that each item only appear once in each combination.
b)selects the combination with prevailing (i.e. highest or lowest) value.
This process, although expressed in general terms, is within or similar to a class of well-known mathematical optimization procedures commonly applied to business problems called linear programming7. Thus, a mathematical algorithm is implicit in the claim.
Schrader further argued that the claim implies no more than the step of summing, hardly a mathematical algorithm in Schrader’s view. The Federal Circuit believed that this was too narrow a view. The claim implied a procedure for determining the optimal combination of bids. While that procedure may have involved summing, it was not limited to it. In any event, even simple summing may be an algorithm.
Schrader’s next point was that, even if a mathematical algorithm is implicit in the claim, the claim recites or implies sufficient physical activity to meet the second prong of the Freeman-Walter-Abele test. Thus, he argued the method physically regroups raw bids into new groupings and ultimately ‘completions’; physically transforms bid data into completion data or display data; and makes physical changes to a “display.” Schrader said that the claim envisages an auction environment in which “all of the bidders are assembled in one large room with a display in front of the room” or with the bidders “assembled in several rooms either adjacent or in different cities interconnected by a closed-circuit television system or the like using large screen displays.”
The Federal Circuit found this argument unpersuasive. The word “display” was nowhere mentioned in the claim. Moreover, there was nothing physical about bids per se. Thus, the grouping or regrouping of bids cannot constitute a physical change, effect, or result. Also, the terms “bid data,” “completion data,” or “display data” are nowhere mentioned in the claim and there was no basis to read them into the claim. Finally, the notion of bidders assembled in a single location in front of a display, or in several locations interconnected by closed-circuit television through a large-screen display was not recited in the claim.
The only physical effect or result which was required by the claim was the entering of bids in a “record,” a step that can be accomplished simply by writing the bids on a piece of paper or a chalkboard. For purposes of Section 101, such activity is indistinguishable from the data gathering steps which according to In re Grams, were insufficient to impart patentability to a claim involving the solving of a mathematical algorithm.
Moreover, the step of entering data into a “record” is implicit in any application of a mathematical algorithm. The recitation of such a step in a claim involving the solving of a mathematical algorithm merely makes explicit what had been implicit. A conclusion that such activity is sufficient to impart patentability to a claim involving the solving of a mathematical algorithm would exalt form over substance. A similar point was recognized in Flook, in which the Court concluded that the recitation of insignificant post-solution activity in a claim involving the solving of a mathematical algorithm could not impart patentability to the claim.
The Federal Circuit found that Schrader’s claims were thus not patentable.
After this case, practitioners such as myself tried to overcome 101 rejections by citing something physical in patent claims. Reciting output devices or displays would often not overcome rejections though.
For example, in an auction involving two contiguous tracts of land, tracts 1 and 2, the following bids might be received and recorded: Bid 1 – $100,000 for tract 1 by bidder A; Bid 2 – $200,000 for tract 2 by bidder B; and Bid 3 – $250,000 for both tracts 1 and 2 by bidder C. The combination of bids that maximizes the revenue to the seller, and thus the combination of bids that forms the “completion,” would be bids 1 and 2.
Schrader claimed that his method constitutes a novel way of conducting auctions. According to Schrader, the type of bids that are normally offered at auctions is dictated solely by the way in which the auctioneer organizes or groups the items to be sold. Through his method, claims Schrader, bids on any combination of the items being auctioned off are offered at the discretion of the bidder. The purported benefit is greater sales revenue or profit to the seller. This is illustrated by the previous example, in which bids were offered on each of the individual tracts as well as on both tracts together. As a result, the seller attained total sales revenue of $300,000. If the seller had only been offered bids on the combined tracts, i.e., Bid 3, the seller would have derived $250,000 in revenue.
Claim 1 was representative:
1. A method of competitively bidding on a plurality of items comprising the steps of identifying a plurality of related items in a record, offering said plurality of items to a plurality of potential bidders, receiving bids from said bidders for both individual ones of said items and a plurality of groups of said items, each of said groups including one or more of said items, said items and groups being any number of all of said individual ones and all of the possible combinations of said items, entering said bids in said record, indexing each of said bids to one of said individual ones or said groups of said items, and assembling a completion of all said bids on said items and groups, said completion identifying a bid for all of said items at a prevailing total price, identifying in said record all of said bids corresponding to said prevailing total price.
During prosecution, the examiner rejected the claims for lack of statutory subject matter under 35 U.S.C. Section 101. After this rejection was made final, Schrader appealed to the Board. On appeal, the Board sustained the rejection on three different grounds.
Schrader appealed to the Federal Circuit and argued that the Board incorrectly invoked the rule that a patent cannot be obtained for a mathematical algorithm in the abstract.
Schrader’s first point was that there was no mathematical algorithm implicit in the claim. The Federal Circuit disagreed. Benson defined a “mathematical algorithm” for purposes of Section 101 as a “procedure for solving a given type of mathematical problem... .” The claim language “assembling a completion” is such a procedure because it describes the solving of a mathematical problem: determining the optimal combination of bids. This conclusion is supported by an admission in Schrader’s brief that the following two-step mathematical process is inherent in the phrase:
Perform a mathematical calculation which
a)determines possible combinations of items and/or groups with the provision that each item only appear once in each combination.
b)selects the combination with prevailing (i.e. highest or lowest) value.
This process, although expressed in general terms, is within or similar to a class of well-known mathematical optimization procedures commonly applied to business problems called linear programming7. Thus, a mathematical algorithm is implicit in the claim.
Schrader further argued that the claim implies no more than the step of summing, hardly a mathematical algorithm in Schrader’s view. The Federal Circuit believed that this was too narrow a view. The claim implied a procedure for determining the optimal combination of bids. While that procedure may have involved summing, it was not limited to it. In any event, even simple summing may be an algorithm.
Schrader’s next point was that, even if a mathematical algorithm is implicit in the claim, the claim recites or implies sufficient physical activity to meet the second prong of the Freeman-Walter-Abele test. Thus, he argued the method physically regroups raw bids into new groupings and ultimately ‘completions’; physically transforms bid data into completion data or display data; and makes physical changes to a “display.” Schrader said that the claim envisages an auction environment in which “all of the bidders are assembled in one large room with a display in front of the room” or with the bidders “assembled in several rooms either adjacent or in different cities interconnected by a closed-circuit television system or the like using large screen displays.”
The Federal Circuit found this argument unpersuasive. The word “display” was nowhere mentioned in the claim. Moreover, there was nothing physical about bids per se. Thus, the grouping or regrouping of bids cannot constitute a physical change, effect, or result. Also, the terms “bid data,” “completion data,” or “display data” are nowhere mentioned in the claim and there was no basis to read them into the claim. Finally, the notion of bidders assembled in a single location in front of a display, or in several locations interconnected by closed-circuit television through a large-screen display was not recited in the claim.
The only physical effect or result which was required by the claim was the entering of bids in a “record,” a step that can be accomplished simply by writing the bids on a piece of paper or a chalkboard. For purposes of Section 101, such activity is indistinguishable from the data gathering steps which according to In re Grams, were insufficient to impart patentability to a claim involving the solving of a mathematical algorithm.
Moreover, the step of entering data into a “record” is implicit in any application of a mathematical algorithm. The recitation of such a step in a claim involving the solving of a mathematical algorithm merely makes explicit what had been implicit. A conclusion that such activity is sufficient to impart patentability to a claim involving the solving of a mathematical algorithm would exalt form over substance. A similar point was recognized in Flook, in which the Court concluded that the recitation of insignificant post-solution activity in a claim involving the solving of a mathematical algorithm could not impart patentability to the claim.
The Federal Circuit found that Schrader’s claims were thus not patentable.
After this case, practitioners such as myself tried to overcome 101 rejections by citing something physical in patent claims. Reciting output devices or displays would often not overcome rejections though.
Arrhythmia Research Technology Inc. v. Corazonix Corp., 1992
The invention was directed to the analysis of electrocardiographic signals in order to determine certain characteristics of the heart function. Dr. Simson, a cardiologist, had sought a solution to the problem of determining which heart attack victims are at high risk for ventricular tachycardia, so that these persons can be carefully monitored and appropriately treated.
Certain steps of the invention were described as being conducted with the aid of a digital computer, and the patent specification set forth the mathematical formulae that were used to configure (program) the computer. The specification stated that dedicated, specific purpose equipment or hard wired logic circuitry can also be used.
The district court held that the method and apparatus claims of the Simpson patent are directed to a mathematical algorithm, and thus do not define statutory subject matter. Claim 1 was the broadest method claim:
1. A method for analyzing electrocardiograph signals to determine the presence or absence of a predetermined level of high frequency energy in the late QRS signal, comprising the steps of:
converting a series of QRS signals to time segments, each segment having a digital value equivalent to the analog value of said signals at said time;
applying a portion of said time segments in reverse time order to high pass filter means;
determining an arithmetic value of the amplitude of the output of said filter; and
comparing said value with said predetermined level.
Claim 7 was a representative apparatus claim:
7. Apparatus for analyzing electrocardiograph signals to determine the level of high frequency energy in the late QRS signal comprising:
means for converting X, Y, and Z lead electrocardiographic input signals to digital valued time segments;
means for examining said X, Y, and Z digital valued time segments and selecting therefrom the QRS waveform portions thereof;
means for signal averaging a multiplicity of said selected QRS waveforms for each of said X, Y, and Z inputs and providing composite, digital X, Y, and Z QRS waveforms;
high pass filter means;
means for applying to said filter means, in reverse time order, the anterior portion of each said digital X, Y, and Z waveform; and
means for comparing the output of said filter means with a predetermined level to obtain an indication of the presence of a high frequency, low level, energy component in the filter output of said anterior portions.
The Patent and Trademark Office had granted the patent without questioning that its claims were directed to statutory subject matter under Section 101.
The Federal Circuit stated that whether a claim is directed to statutory subject matter is a question of law.
The Federal Circuit recognized that Supreme Court has observed that Congress intended section 101 to include “anything under the sun that is made by man.” Diamond v. Chakrabarty, 447 U.S. 303, 309, 206 USPQ 193, 197 (1980), quoting S. Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952); H.R. Rep. No. 1923, 82d Cong., 2d Sess., 6 (1952). There are, however, qualifications to the apparent sweep of this statement. Excluded from patentability is subject matter in the categories of “laws of nature, physical phenomena, and abstract ideas”. Diamond v. Diehr,450 U.S. 175, 185, 209 USPQ 1, 7 (1981). A mathematical formula may describe a law of nature, a scientific truth, or an abstract idea. As courts have recognized, mathematics may also be used to describe steps of a statutory method or elements of a statutory apparatus. The exceptions to patentable subject matter derive from a lengthy jurisprudence, but their meaning was probed anew with the advent of computer-related inventions.
The Federal Circuit then noted that in Gottschalk v. Benson, 409 U.S. 63, 72, 175 USPQ 673, 676 (1972) the Court held that a patent claim that “wholly pre-empts” a mathematical formula used in a general purpose digital computer is directed solely to a mathematical algorithm, and therefore does not define statutory subject matter under section 101. The Court described the mathematical process claimed in Benson as “so abstract and sweeping as to cover both known and unknown uses of the BCD [binary coded decimal] to pure binary conversion.”
The court then noted that in Parker v. Flook, 437 U.S. 584, 591, 198 USPQ 193, 198 (1978) the Court explained that the criterion for patentability of a claim that requires the use of mathematical procedures is not simply whether the claim “wholly pre-empts” a mathematical algorithm, but whether the claim is directed to a new and useful process, independent of whether the mathematical algorithm required for its performance is novel. Applying these criteria the Court held nonstatutory a method claim for computer-calculating “alarm limits” for use in a catalytic conversion process, on the basis that “once that algorithm is assumed to be within the prior art, the application, considered as a whole, contains no patentable invention.” Flook, 437 U.S. at 594, 198 USPQ at 199.
The Federal Circuit then noted that in Diamond v. Diehr the Court explained that non-statutory status under section 101 derives from the “abstract”, rather than the “sweeping”, nature of a claim that contains a mathematical algorithm. The Court stated:
“While a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid of knowledge of scientific truth may be.”
The mathematical algorithm in Diehr was the known Arrhenius equation, and the Court held that when the algorithm was incorporated in a useful process, the subject matter was statutory. The Court confirmed the rule that process steps or apparatus functions that entail computer-performed calculations, whether the calculations are described in mathematical symbols or in words, do not of themselves render a claim nonstatutory. In Diehr, the Court clarified its earlier holdings, stating that “[I]t is inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the [section 101] analysis.”
The Court thus placed the patentability of computer-aided inventions in the mainstream of the law. The ensuing mode of analysis of such inventions was summarized in In re Meyer, 688 F.2d 789, 795, 215 USPQ 193, 198 (CCPA 1982):
In considering a claim for compliance with 35 USC 101, it must be determined whether a scientific principle, law of nature, idea, or mental process, which may be represented by a mathematical algorithm, is included in the subject matter of the claim. If it is, it must then be determined whether such principle, law, idea, or mental process is applied in an invention of a type set forth in 35 USC 101.
The law crystallized about the principle that claims directed solely to an abstract mathematical formula or equation, including the mathematical expression of scientific truth or a law of nature, whether directly or indirectly stated, are nonstatutory under section 101; whereas claims to a specific process or apparatus that is implemented in accordance with a mathematical algorithm will generally satisfy section 101.
In applying this principle to an invention whose process steps or apparatus elements are described at least in part in terms of mathematical procedures, the mathematical procedures are considered in the context of the claimed invention as a whole. Determination of statutory subject matter has been conveniently conducted in two stages, following a protocol initiated by the Court of Customs and Patent Appeals in In re Freeman, 573 F.2d 1237, 197 USPQ 464 (CCPA 1978); modified after the Court’s Flook decision by In re Walter, 618 F.2d 758, 205 USPQ 397 (CCPA 1980); and again after the Court’s Diehr decision by In re Abele, 684 F.2d 902, 214 USPQ 682 (CCPA 1982).
This analysis has been designated the Freeman-Walter-Abele test for statutory subject matter. It is first determined whether a mathematical algorithm is recited directly or indirectly in the claim. If so, it is next determined whether the claimed invention as a whole is no more than the algorithm itself; that is, whether the claim is directed to a mathematical algorithm that is not applied to or limited by physical elements or process steps. Such claims are nonstatutory. However, when the mathematical algorithm is applied in one or more steps of an otherwise statutory process claim, or one or more elements of an otherwise statutory apparatus claim, the requirements of section 101 are met. The court in Abele explained that:
Walter should be read as requiring no more than that the algorithm be “applied in any manner to physical elements or process steps,” provided that its application is circumscribed by more than a field of use limitation or non-essential post-solution activity.
Although the Freeman-Walter-Abele analysis is not the only test for statutory subject matter, and the Federal Circuit stated that failure to meet that test may not always defeat the claim, the Federal Circuit found that this analytic procedure was conveniently applied to the Simson invention.
Applying the Freeman-Walter-Abele protocol to the process claims, the Federal Circuit accepted the proposition that a mathematical algorithm is included in the subject matter of the process claims in that some claimed steps are described in the specification by mathematical formulae. The Court thus proceeded to the second stage of the analysis, to determine whether the claimed process is otherwise statutory.
Simson’s process was claimed as a “method for analyzing electrocardiograph signals to determine the presence or absence of a predetermined level of high-frequency energy in the late QRS signal”. This claim limitation was not ignored in determining whether the subject matter as a whole is statutory, for all of the claim steps are in implementation of this method. The electrocardiograph signals are first transformed from analog form, in which they are obtained, to the corresponding digital signal. These input signals are not abstractions; they are related to the patient’s heart function.
The Federal Circuit took the position that the claimed steps of “converting”, “applying”, “determining”, and “comparing” were physical process steps that transform one physical, electrical signal into another and that the Freeman-Walter-Abele standard was met, for the steps of Simson’s claimed method comprise an otherwise statutory process whose mathematical procedures are applied to physical process steps.
The apparatus claims require a means for converting the electrocardiograph signals from the analog form in which they are generated into digital form.
The use of mathematical formulae or relationships to describe the electronic structure and operation of an apparatus does not make it nonstatutory. Iwahashi, 888 F.2d at 1375, 12 USPQ2d at 1911.
The Federal Circuit therefore concluded that the Simson apparatus claims satisfied the criteria for statutory subject matter.
After this case was decided, practitioners such as myself went out of our way to include A-D or D-A converters in our application. Many examiners, however, still would routinely issue 101 rejections if they saw an algorithm in a patent application.
The concurrence to this case by Judge Rader was also quite interesting:
Nearly twenty years ago, in Gottschalk v. Benson, 409 U.S. 63 [175 USPQ 458] (1972), the Supreme Court dealt with a computer process for conversion of binary coded decimals into pure binary numbers was not patentable subject matter. Benson held this mathematical algorithm ineligible for patent protection. 409 U.S. at 65, 71-72. Because computer programs rely heavily on mathematical algorithms, commentators saw dire implications in the Supreme Court’s opinion for patent protection of computer software. For instance, one treatise, citing Benson, stated:
[A] recent Supreme Court decision seemingly eliminated patent protection for computer software.
Donald S. Chisum, Patents Section 1.01 (1991); see also id. at Section 1.03 [6].
The court upholds the ‘459 patent by applying a permutation of the Benson algorithm rule. In reaching this result, the court adds another cord to the twisted knot of precedent encircling and confining the Benson rule. While fully concurring in the court’s result and commending its ability to trace legal strands through the tangle of post-Benson caselaw, I read later Supreme Court opinions to have cut the Gordian knot. The Supreme Court cut the knot by strictly limiting Benson.
Relying on the language of the patent statute, the Supreme Court in Diamond v. Diehr, 450 U.S. 175 [209 USPQ 1] (1981), turned away from the Benson algorithm rule. Thus, I too conclude that the ‘459 patent claims patentable subject matter – not on the basis of a two-step post-Benson test, but on the basis of the patentable subject matter standards in title 35. Rather than perpetuate a non-statutory standard, I would find that the subject matter of the ‘459 patent satisfies the statutory standards of the Patent Act.
Certain steps of the invention were described as being conducted with the aid of a digital computer, and the patent specification set forth the mathematical formulae that were used to configure (program) the computer. The specification stated that dedicated, specific purpose equipment or hard wired logic circuitry can also be used.
The district court held that the method and apparatus claims of the Simpson patent are directed to a mathematical algorithm, and thus do not define statutory subject matter. Claim 1 was the broadest method claim:
1. A method for analyzing electrocardiograph signals to determine the presence or absence of a predetermined level of high frequency energy in the late QRS signal, comprising the steps of:
converting a series of QRS signals to time segments, each segment having a digital value equivalent to the analog value of said signals at said time;
applying a portion of said time segments in reverse time order to high pass filter means;
determining an arithmetic value of the amplitude of the output of said filter; and
comparing said value with said predetermined level.
Claim 7 was a representative apparatus claim:
7. Apparatus for analyzing electrocardiograph signals to determine the level of high frequency energy in the late QRS signal comprising:
means for converting X, Y, and Z lead electrocardiographic input signals to digital valued time segments;
means for examining said X, Y, and Z digital valued time segments and selecting therefrom the QRS waveform portions thereof;
means for signal averaging a multiplicity of said selected QRS waveforms for each of said X, Y, and Z inputs and providing composite, digital X, Y, and Z QRS waveforms;
high pass filter means;
means for applying to said filter means, in reverse time order, the anterior portion of each said digital X, Y, and Z waveform; and
means for comparing the output of said filter means with a predetermined level to obtain an indication of the presence of a high frequency, low level, energy component in the filter output of said anterior portions.
The Patent and Trademark Office had granted the patent without questioning that its claims were directed to statutory subject matter under Section 101.
The Federal Circuit stated that whether a claim is directed to statutory subject matter is a question of law.
The Federal Circuit recognized that Supreme Court has observed that Congress intended section 101 to include “anything under the sun that is made by man.” Diamond v. Chakrabarty, 447 U.S. 303, 309, 206 USPQ 193, 197 (1980), quoting S. Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952); H.R. Rep. No. 1923, 82d Cong., 2d Sess., 6 (1952). There are, however, qualifications to the apparent sweep of this statement. Excluded from patentability is subject matter in the categories of “laws of nature, physical phenomena, and abstract ideas”. Diamond v. Diehr,450 U.S. 175, 185, 209 USPQ 1, 7 (1981). A mathematical formula may describe a law of nature, a scientific truth, or an abstract idea. As courts have recognized, mathematics may also be used to describe steps of a statutory method or elements of a statutory apparatus. The exceptions to patentable subject matter derive from a lengthy jurisprudence, but their meaning was probed anew with the advent of computer-related inventions.
The Federal Circuit then noted that in Gottschalk v. Benson, 409 U.S. 63, 72, 175 USPQ 673, 676 (1972) the Court held that a patent claim that “wholly pre-empts” a mathematical formula used in a general purpose digital computer is directed solely to a mathematical algorithm, and therefore does not define statutory subject matter under section 101. The Court described the mathematical process claimed in Benson as “so abstract and sweeping as to cover both known and unknown uses of the BCD [binary coded decimal] to pure binary conversion.”
The court then noted that in Parker v. Flook, 437 U.S. 584, 591, 198 USPQ 193, 198 (1978) the Court explained that the criterion for patentability of a claim that requires the use of mathematical procedures is not simply whether the claim “wholly pre-empts” a mathematical algorithm, but whether the claim is directed to a new and useful process, independent of whether the mathematical algorithm required for its performance is novel. Applying these criteria the Court held nonstatutory a method claim for computer-calculating “alarm limits” for use in a catalytic conversion process, on the basis that “once that algorithm is assumed to be within the prior art, the application, considered as a whole, contains no patentable invention.” Flook, 437 U.S. at 594, 198 USPQ at 199.
The Federal Circuit then noted that in Diamond v. Diehr the Court explained that non-statutory status under section 101 derives from the “abstract”, rather than the “sweeping”, nature of a claim that contains a mathematical algorithm. The Court stated:
“While a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid of knowledge of scientific truth may be.”
The mathematical algorithm in Diehr was the known Arrhenius equation, and the Court held that when the algorithm was incorporated in a useful process, the subject matter was statutory. The Court confirmed the rule that process steps or apparatus functions that entail computer-performed calculations, whether the calculations are described in mathematical symbols or in words, do not of themselves render a claim nonstatutory. In Diehr, the Court clarified its earlier holdings, stating that “[I]t is inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the [section 101] analysis.”
The Court thus placed the patentability of computer-aided inventions in the mainstream of the law. The ensuing mode of analysis of such inventions was summarized in In re Meyer, 688 F.2d 789, 795, 215 USPQ 193, 198 (CCPA 1982):
In considering a claim for compliance with 35 USC 101, it must be determined whether a scientific principle, law of nature, idea, or mental process, which may be represented by a mathematical algorithm, is included in the subject matter of the claim. If it is, it must then be determined whether such principle, law, idea, or mental process is applied in an invention of a type set forth in 35 USC 101.
The law crystallized about the principle that claims directed solely to an abstract mathematical formula or equation, including the mathematical expression of scientific truth or a law of nature, whether directly or indirectly stated, are nonstatutory under section 101; whereas claims to a specific process or apparatus that is implemented in accordance with a mathematical algorithm will generally satisfy section 101.
In applying this principle to an invention whose process steps or apparatus elements are described at least in part in terms of mathematical procedures, the mathematical procedures are considered in the context of the claimed invention as a whole. Determination of statutory subject matter has been conveniently conducted in two stages, following a protocol initiated by the Court of Customs and Patent Appeals in In re Freeman, 573 F.2d 1237, 197 USPQ 464 (CCPA 1978); modified after the Court’s Flook decision by In re Walter, 618 F.2d 758, 205 USPQ 397 (CCPA 1980); and again after the Court’s Diehr decision by In re Abele, 684 F.2d 902, 214 USPQ 682 (CCPA 1982).
This analysis has been designated the Freeman-Walter-Abele test for statutory subject matter. It is first determined whether a mathematical algorithm is recited directly or indirectly in the claim. If so, it is next determined whether the claimed invention as a whole is no more than the algorithm itself; that is, whether the claim is directed to a mathematical algorithm that is not applied to or limited by physical elements or process steps. Such claims are nonstatutory. However, when the mathematical algorithm is applied in one or more steps of an otherwise statutory process claim, or one or more elements of an otherwise statutory apparatus claim, the requirements of section 101 are met. The court in Abele explained that:
Walter should be read as requiring no more than that the algorithm be “applied in any manner to physical elements or process steps,” provided that its application is circumscribed by more than a field of use limitation or non-essential post-solution activity.
Although the Freeman-Walter-Abele analysis is not the only test for statutory subject matter, and the Federal Circuit stated that failure to meet that test may not always defeat the claim, the Federal Circuit found that this analytic procedure was conveniently applied to the Simson invention.
Applying the Freeman-Walter-Abele protocol to the process claims, the Federal Circuit accepted the proposition that a mathematical algorithm is included in the subject matter of the process claims in that some claimed steps are described in the specification by mathematical formulae. The Court thus proceeded to the second stage of the analysis, to determine whether the claimed process is otherwise statutory.
Simson’s process was claimed as a “method for analyzing electrocardiograph signals to determine the presence or absence of a predetermined level of high-frequency energy in the late QRS signal”. This claim limitation was not ignored in determining whether the subject matter as a whole is statutory, for all of the claim steps are in implementation of this method. The electrocardiograph signals are first transformed from analog form, in which they are obtained, to the corresponding digital signal. These input signals are not abstractions; they are related to the patient’s heart function.
The Federal Circuit took the position that the claimed steps of “converting”, “applying”, “determining”, and “comparing” were physical process steps that transform one physical, electrical signal into another and that the Freeman-Walter-Abele standard was met, for the steps of Simson’s claimed method comprise an otherwise statutory process whose mathematical procedures are applied to physical process steps.
The apparatus claims require a means for converting the electrocardiograph signals from the analog form in which they are generated into digital form.
The use of mathematical formulae or relationships to describe the electronic structure and operation of an apparatus does not make it nonstatutory. Iwahashi, 888 F.2d at 1375, 12 USPQ2d at 1911.
The Federal Circuit therefore concluded that the Simson apparatus claims satisfied the criteria for statutory subject matter.
After this case was decided, practitioners such as myself went out of our way to include A-D or D-A converters in our application. Many examiners, however, still would routinely issue 101 rejections if they saw an algorithm in a patent application.
The concurrence to this case by Judge Rader was also quite interesting:
Nearly twenty years ago, in Gottschalk v. Benson, 409 U.S. 63 [175 USPQ 458] (1972), the Supreme Court dealt with a computer process for conversion of binary coded decimals into pure binary numbers was not patentable subject matter. Benson held this mathematical algorithm ineligible for patent protection. 409 U.S. at 65, 71-72. Because computer programs rely heavily on mathematical algorithms, commentators saw dire implications in the Supreme Court’s opinion for patent protection of computer software. For instance, one treatise, citing Benson, stated:
[A] recent Supreme Court decision seemingly eliminated patent protection for computer software.
Donald S. Chisum, Patents Section 1.01 (1991); see also id. at Section 1.03 [6].
The court upholds the ‘459 patent by applying a permutation of the Benson algorithm rule. In reaching this result, the court adds another cord to the twisted knot of precedent encircling and confining the Benson rule. While fully concurring in the court’s result and commending its ability to trace legal strands through the tangle of post-Benson caselaw, I read later Supreme Court opinions to have cut the Gordian knot. The Supreme Court cut the knot by strictly limiting Benson.
Relying on the language of the patent statute, the Supreme Court in Diamond v. Diehr, 450 U.S. 175 [209 USPQ 1] (1981), turned away from the Benson algorithm rule. Thus, I too conclude that the ‘459 patent claims patentable subject matter – not on the basis of a two-step post-Benson test, but on the basis of the patentable subject matter standards in title 35. Rather than perpetuate a non-statutory standard, I would find that the subject matter of the ‘459 patent satisfies the statutory standards of the Patent Act.
16 February 2007
Patent Office Solicitor's Legal Analysis, 1989
In 1989, Associate Solicitor Lee E. Barrett, an attorney in the Office of the Solicitor of the Patent and Trademark Office, performed a legal analysis on the subject of the patentability of mathematical algorithms and computer programs. The analysis was stated to have been published for the benefit of the public. Patent Examiners at the time were still anti-software patent.
August 9, 1989. FRED E. McKELVEY, Solicitor
Table of Contents
I. STATUTORY SUBJECT MATTER: 35 U.S.C. $ 101
II. MATHEMATICAL ALGORITHMS
A. Mathematical algorithms per se are not a statutory "process"
under $ 101
B. Evolution of the two-part test for mathematical
algorithm-statutory subject matter
C. Application of the two-part test
1. Step 1 -- presence of a mathematical algorithm
a. Mathematical algorithm
b. "Process" versus "apparatus" claims
c. Form of the mathematical algorithm
2. Step 2 -- is the mathematical algorithm "applied in any
manner to physical elements or process steps?"
a. Post-solution activity
b. Field of use limitations
c. Data-gathering steps
d. Transformation of something physical
e. Structural limitations in process claims
D. Examples
1. Diamond v. Diehr
2. Parker v. Floor
3. In re Abele
III. COMPUTER PROGRAMS
A. "Computer programs" versus "computer processes"
B. Statutory nature of computer processes
1. The Supreme Court has not ruled on the patentability of
computer programs
2. The CCPA has held that computer processes are statutory
unless they fall within a judicially determined exception
Discussion
I. Statutory Subject Matter: 35 U.S.C. $ 101
Inventions may be patented only if they fall within one of the four statutory classes of subject matter of 35 U.S.C. $ 101: "process, machine, manufacture, or composition of matter." See Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 483, 181 USPQ 673, 679 (1974):
[N]o patent is available for a discovery, however useful, novel, and nonobvious, unless it falls within one of the express categories of patentable subject matter of 35 U.S.C. $ 101.
Subject matter that does not fall within one of the statutory classes of 35 U.S.C. $ 101 is said to be "nonstatutory" or to be "unpatentable subject matter." The broad language of $ 101 is intended to delineate a "general industrial boundary" of patentable invention. In re Bergy, 596 F.2d 952, 974 n.11, 201 USPQ 352, 372 n.11 (CCPA 1979), vacated, 444 U.S. 1028, aff'd sub nom., Diamond v. Chakrabarty, 447 U.S. 303, 206 USPQ 193 (1980). The first statutory class, process, is defined in 35 U.S.C. $ 100(b) and refers to acts, while the last three classes, machine, manufacture and composition of matter, refer to physical things; therefore, the general field of patentable invention consists of new acts and new things. Id. The classes relevant to this discussion are "process" and "machine." A "process" is equivalent to a "method." Bergy 596 F.2d at 965, 201 USPQ at 364. The term "machine" is used interchangeably with "apparatus." In re Prater, 415 F.2d 1393, 1395 n.11,
162 USPQ 541, 543 n.11 (CCPA 1969).
The question of whether a claimed invention satisfies the other conditions for patentability is "wholly apart from whether the invention falls into a category of statutory subject matter" (emphasis deleted). Diamond v. Diehr, 450 U.S. 175, 190, 209 USPQ 1, 9 (1981) (citing Bergy, 596 F.2d at 961, 201 USPQ at 361). As stated in Parker v. Flook, 437 U.S. 584, 593, 198 USPQ 193, 198-99 (1978):
The obligation to determine what type of discovery is sought to be patented must precede the determination of whether that discovery is, in fact, new [i.e., novel under $ 102] or obvious [$ 103].
See also In re Sarkar, 588 F.2d 1330, 1333 n.10, 200 USPQ 132, 137 n.10 (CCPA 1978) ("If the subject matter as claimed is subject to patenting, i.e., if it falls within $ 101, it must them be examined for compliance with $$ 102 and 103"). Legislative history indicates that Congress contemplated that the subject matter provisions be given a broad construction and were intended to "include anything under the sun that is made by man." Diamond v. Chakrabarry, 447 U.S. at 309, 206 USPQ at 197. Any process, machine, manufacture, or composition of matter constitutes statutory subject matter unless it falls within a judicially determined exception to $ 101. In re Pardo, 684 F.2d 912, 916, 214 USPQ 673, 677 (CCPA 1982). Exceptions include laws of nature, physical phenomena and abstract ideas. Diehr, 450 U.S. at 185, 209 USPQ at 7, and cases cited therein. This analysis addresses whether mathematical algorithms and computer programs are statutory subject matter.
II. Mathematical Algorithms
A. Mathematical algorithms per se are not a statutory "process" under $ 101
A mathematical algorithm is defined as a "procedure for solving a given type of mathematical problem." Gottschalk v. Benson, 409 U.S. 63, 65, 175 USPQ 673, 674 (1972); Flook, 437 U.S. at 585 n.1. 198 USPQ at 195 n.1: Diehr, 450 U.S. at 186, 209 USPQ at 8. Mathematical algorithms are non- statutory because they have been determined not to fall within the $ 101 statutory class of a "process." Benson. "[A]n algorithm, or mathematical formula, is like a law of nature, which cannot be the subject of a patent." Diehr, 450 U.S. at 186, 209 USPQ at 8. The exception applies only to mathematical algorithms since any process is an " algorithm" in the sense that it is a step-by-step procedure to arrive at a given result. In re Walter, 618 F.2d 758, 764 n.4, 205 USPQ 397, 405 n.4, (CCPA 1980); Pardo, 684 F.2d at 915,
214 USPQ at 676.
Although mathematical algorithms per se are nonstatutory, as stated in Diehr, 450 U.S. at 187-88, 209 USPQ at 8-9:
[A] claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula, computer program, or digital computer. . . .
[I]n Parker v. Flook we stated that "a process is not unpatentable simply because it contains a law of nature or a mathematical algorithm. " 437 U.S. at 590. It is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection. As Justice Stone explained four decades ago: "While a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid and knowledge of scientific truth may be."
Mackay Radio & Telegraph Co. v. Radio Corp. of America, 306 U.S. 86, 94 (1939). [Citations omitted]. The Supreme Court thus recognizes that mathematical algorithms are "the basic tools of scientific and technological work." Benson, 409 U.S. at 67, 175 USPQ at 674, and should not be the subject of exclusive rights, whereas technological application of scientific principles and mathematical algorithms furthers the constitutional purpose of promoting "the Progress of . . . Useful arts." U.S. Const. art. I, $ 8. It is also recognized that mathematical algorithms may be the most precise way to described the invention.
Where claims involve mathematical algorithms, as stated in In re Abele, 684 F.2d 902, 907, 214 USPQ 687 (CCPA 1982): The goal is to answer the question "What did applicants invent?" If the claimed invention is a mathematical algorithm, it is improper subject matter for patent protection, whereas if the claimed invention is an application of the algorithm, $ 101 will not bar the grant of a patent.
The tests for determining whether claims containing mathematical algorithms are statutory have gradually evolved in the courts since the Supreme Court's decision in Benson in 1972.
B. Evolution of the two-part test for mathematical algorithm
-statutory subject matter
The proper legal analysis of mathematical algorithm
-statutory subject matter cases is the two-part test of In re Freeman, 573 F.2d 1237, 197 USPQ 464 (CCPA 1978), as modified by Walter and Abele. See In re Meyer, 688 F.2d 789, 796, 215 USPQ 193, 198 (CCPA 1982) ("A more comprehensive test for cases involving mathematical algorithms is set forth In re Abele"). A review of the evolution of the analysis provides some useful insights into the application of the test.
In Benson, the Supreme Court concluded that claims directed to a particular algorithm for converting binary coded decimal numbers to binary numbers was not statutory subject matter. The Supreme Court further concluded that any patent issued on those claims "would wholly preempt the mathematical formula and in practical effect would be a patent on the algorithm itself." 409 U.S. at 72. 175 USPQ at 676. These two conclusions formed the basis for the two-part analysis of the Court of Customs and Patent Appeals (CCPA) in Freeman, 573 F.2d at 1245, 197 USPQ at 471:
First, it must be determined whether the claim directly or indirectly recites an " algorithm" in the Benson sense of that term, for a claim which fails even to recite an algorithm clearly cannot wholly preempt an algorithm.
Second, the claim must be further analyzed to ascertain whether in its entirety it wholly preempts that algorithm. In 1978, the Supreme Court held in Flook that a claim need "not . . . cover every conceivable application of the formula," to be nonstatutory, 437 U.S. at 586, 198 USPQ at 196. This decision left undefined what constitutes statutory subject matter. In Walter, the CCPA modified the second step of Freeman to require a more positive approach to determining what is claimed, 618 F.2d at 767, 205 USPQ at 407:
If it appears that the mathematical algorithm is implemented in a specific manner to define structural relationships between the physical elements of the claim (in apparatus claims) or to refine or limit claim steps (in process claims), the claim being otherwise statutory, the claim passes muster under $ 101. If, however, the mathematical algorithm is merely presented and solved by the claimed invention, as was the case in Benson and Flook, and is not applied in any manner to physical elements or process steps, no amount of post-solution activity will render the claim statutory; nor is it saved by a preamble merely reciting the field of use of the
mathematical algorithm.
The CCPA noted that while the second step of Freeman was "stated in terms of preemption" it had consistently been applied "in the spirit of the foregoing principles." 618 F.2d at 767, 205 USPQ at 407.
In Abele, the CCPA further modified the second part of the test to provide a more comprehensive test. 684 F.2d at 906- 7, 214 USPQ at 686:
Appellants summarize the Walter test as setting forth two ends of a spectrum: what is now clearly nonstatutory, i.e., claims in which an algorithm is merely presented and solved by the claimed invention (preemption), and what is clearly statutory, i.e., claims in which an algorithm is implemented in a specific manner to define structural
relationships between the physical elements of the claim (in an apparatus claim) or to refine or limit steps (in a process).
Appellants urge that the statement of the test in Walter fails to provide a useful tool for analyzing claims in the "gray area" which falls between the two ends of that spectrum. We agree that the board's understanding and application of the Walter analysis justifies appellant's position. However, the Walter analysis quoted above does not limit patentable subject matter only to claims in which structural relationships or process steps are defined, limited or refined by the application of the algorithm. Rather, Walter should be read as requiring no more than the algorithm be "applied in any manner to physical elements or process steps," provided that its
application is circumscribed by more than a field of use limitation or non-essential post-solution activity. Thus, if the claim would be "otherwise statutory," id., albeit inoperative or less useful without the algorithm, the claim likewise presents statutory subject matter when the algorithm is included.
This broad reading of Walter, we conclude, is in accord with the Supreme Court decisions [holding "that a claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula, computer program, or digital computer." Diamond v. Diehr, 450 U.S. at 187, 209 USPQ at 8].
The reason for the modification of the test was because, as noted in Abele, 684 F.2d at 909, 214 USPQ at 688:
The algorithm [in Abele] does not necessarily refine or limit the earlier steps of production and detection as would be required to achieve the status of patentable subject matter by the board's narrow reading of Walter.
The second test of Abele suggests that the determination of whether the algorithm is "applied in any manner to physical element or process steps" may be made by viewing the claims without the algorithm and determining whether what remains is "otherwise statutory." This analysis focuses on identifying the statutory process in the claim and is consistent with previous cases such as Walter, 618 F.2d at 769, 205 USPQ at 409 ("Examination of each claim demonstrates that each has no substance apart from the calculations involved" ). The technique of viewing the claim without the mathematical algorithm is not inconsistent with the requirement that claims must be considered "as a whole" under $ 101.
The requirement that claims be considered "as a whole" arose out of the now rejected "point of novelty" approach to statutory subject matter. Under the "point of novelty" approach, if a claim considered without the nonstatutory subject matter was unpatentable over the prior art (i.e., if the algorithm was at the "point of novelty" of the claim), the claims were found to not recite statutory subject matter. This approach was consistently rejected by the CCPA. See In re Chatfield, 545 F.2d 152, 191 USPQ 730 (CCPA 1976), cert. denied, 434 U.S. 875 (1977); In re Deutsch, 553 F.2d 689, 193 USPQ 645 (CCPA 1977); In re de Castelet, 562 F.2d 1236, 195 USPQ 439 (CCPA 1977); Freeman; Sarkar; Walter. The point of novelty approach was finally put to
rest in Diehr, 450 U.S. at 188-89, 209 USPQ at 9:
In determining the eligibility of respondents' claimed process for patent protection under $ 101, their claims must be considered as a whole. It is inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the analysis. . . . The "novelty" of any element or steps in a process, or even of the process itself, is of no relevance in determining whether the subject matter of a claim falls within the $ 101 categories of possibly patentable subject matter.
Under the second test of Abele, the claims are considered without the algorithm to determine whether what remains is "otherwise statutory," not to determine whether what remains is novel and nonobvious.
C. Application of the two-part test
1. Step 1 -- presence of a mathematical algorithm
a. Mathematical algorithm
A mathematical algorithm is a "procedure for solving a given type of mathematical problem." In this sense, a mathematical algorithm refers "to methods of calculation, mathematical formulas, and mathematical procedures generally." Walter, 618 F.2d at 764-65 n.4, 205 USPQ at 405 n.4. "The type of mathematical computation involved does not determine whether a procedure is statutory or nonstatutory." In re Gelnovatch, 595 F.2d 32, 41.201 USPQ 136, 145 (CCPA 1979). A "claim for an improved method of calculation, even when tied to a specific end use, is unpatentable subject matter under $101." Flook, 437 U.S. at 595 n.18, 198 USPQ at 199 n.18. Mathematical algorithms may represent scientific principles, laws of nature, or ideas or mental processes for solving complex problems. See Meyer, 688 F.2d at 794-95, 215 USPQ at 197:
Scientific principles, such as the relationship between mass and energy [E =mc^2], and laws of nature, such as the acceleration of gravity, namely a =32 ft/sec.^2, can be represented in mathematical format. However, some mathematical algorithms and formulae do not represent ideas or mental processes and are simply logical vehicles for communicating possible solutions to complex problems. See also Safe Flight Instrument Corp. v. Sundstrand Data Control, Inc., 706 F.Supp. 1146, 10 USPQ2d 1733 (D.Del. 1989) (mathematical algorithm representing a natural phenomenon, windshear).
No distinction is made between mathematical algorithms invented by man, and mathematical algorithms representing discoveries of scientific principles and laws of nature which reveal a relationship that has always existed.
b. "Process" versus "appears" claims
Since mathematical algorithms have been determined not to fall within the $101 statutory class of a "process," attempts have been made to circumvent the nonstatutory subject matter rejection by drafting mathematical algorithms as "machine" claims. The technique used is to draft the method steps in terms of "means for" language permitted by 35 U.S.C. $ 112, sixth paragraph. While such a claim is technically a "machine" or "apparatus" claim, the courts have held that form of the claim does not control whether the subject matter is statutory. See In re Maucorps, 609 F.2d 481, 485, 203 USPQ 812, 815-16 (CCPA 1979):
Labels are not determinative $ 101 inquiries. "Benson applies equally whether an invention is claimed as an apparatus or process, because the form of the claim is often an exercise in drafting." In re Johnson, 589 F.2d 1070, 1077, 200 USPQ 199, 206 ([CCPA] 1978). "Though a claim expressed in 'means for (functional) terms [under 35 U.S.C. $ 112, sixth paragraph] is said to be an apparatus claim, the subject matter as a whole of that claim may be indistinguishable from that of a method claim drawn to the steps performed by the 'means,'" In re Freeman, 573 F.2d at 1247, 197 USPQ at 472. Moreover, that the claimed computing system may be a "machine" within "the ordinary sense of the word," as appellant argues, is irrelevant. The holding in Benson "forecloses a purely literal reading of $ 101."
The test for determining whether "means for" apparatus claims should be treated as method claims is stated in Walter, 618 F.2d at 768, 205 USPQ at 408:
If the functionally-defined disclosed means and their equivalents are so broad that they encompass any and every means for performing the recited functions, the apparatus claim is an attempt to exalt form over substance since the claim is really to the method or series of functions itself . . . . In such cases the burden must be placed on the applicant to demonstrate that the claims are truly drawn to specific apparatus distinct from other apparatus capable of performing the identical functions.
If this burden has not been discharged, the apparatus claim will be treated as if it were drawn to the method or process which encompasses all of the claimed "means." See In re Maucorps, 609 F.2d at 485, 203 USPQ at 815-816: In re Johnson, 589 F.2d at 1077, 200 USPQ at 206: In re Freeman, 573 F.2d at 1247, 197 USPQ at 472. The statutory nature of the claim under $ 101 will then depend on whether the corresponding method is statutory.
See also Meyer, 688 F.2d at 795 n.3, 215 USPQ at 198 n.3; Abele, 684 F.2d at 909, 214 USPQ at 688; Pardo. 684 F.2d at 916 n.6. 214 USPQ at 677 n.6; Arshal v. United States, 621 F.2d 421, 427-28, 208 USPQ 397, 404 (Ct. Cl. 1980), cert. denied, 449 U.S. 1077 (1981), reh'g denied, 450 U.S. 1050 (1981). In Maucorps, the limitation of various "means" in claim 1 to include certain "electric circuits" did not prevent the claim from being treated as a method. A claim is not presumed to be statutory simply because it is in apparatus form.
c. Form of the mathematical algorithm
The first step of the analysis is to determine whether the claim directly or indirectly recites a mathematical algorithm. A mathematical algorithm can appear in many forms. As stated in Freeman, 573 F.2d at 1246, 197 USPQ at 471:
The manner in which a claim recites a mathematical algorithm may vary considerably. In some claims, a formula or equation may be expressed in traditional mathematical symbols so as to be immediately recognizable as a mathematical algorithm. See e.g., In re Richman, 563 F.2d 1026, 195 USPQ 340 ([CCPA] 1977); In re Flook, 559 F.2d 21, 195 USPQ 9([CCPA] 1977), cert. granted such nom, Parker v. Flook, [437 U.S. 584] (1978). Other claims may use prose to express a mathematical computation or to indirectly recite a mathematical equation or formula by means of a prose equivalent therefor. See, e.g., In re de Castelet, supra (claims 6 and 7); In re Waldhaum, 559
F.2d 611, 194 USPQ 465 ([CCPA] 1977). A claim which substitutes, for a mathematical formula in algebraic form, "words which mean the same thing," nonetheless recites an algorithm in the Benson sense. In re Richman, supra 563 F.2d at 1030, 195 USPQ at 344. Indeed, the claims at issue on Benson did not contain a formula equation expressed in mathematical symbols.
Claims which include mathematical formulas or calculations expressed in mathematical symbols clearly include a mathematical algorithm. Mathematical algorithms in prose form may be expressed as literal translations of the mathematical algorithm (e.g., substituting the expression "division" or "taking the ratio" for a diversion sign) or may be expressed in words which indicate the mathematical algorithm. See Safe Flight Instrument, 706 F.Supp. at 1148, 10 USPQ at 1734 (subtracting); Abele, 684 F.2d at 908 n. 8, 214 USPQ at 687 n.8 ("The algorithm, calculating the difference, is defined in the specification as a Gaussian weighting function"): In re Taner, 681 F.2d 787, 790, 214 USPQ 678, 681 (CCPA 1982) (summing); In re Johnson, 589 F.2d 1070, 1079, 200 USPQ 199, 208 (CCPA (1978) ("'computing' connotes the execution of the one of a sequence of mathematical operations"); In re Waldbaum, 559 F.2d 611, 194 USPQ 465 (CCPA 1977) (method of claim 1 "to count" the number of busy lines "solves a mathematical problem, to wit, counting a number of busy lines in a telephone system." In re Bradley, 600 F.2d 807, 810 n. 4, 202 USPQ 480, 484 n.4 (CCPA 1979), aff'd by an equally divided court sub nom.
Diamond v. Bradley, 450 U.S. 381, 209 USPQ 97 (1981)).
It is not always possible to determine by inspection of the claim whether it indirectly recites a mathematical algorithm; in such instances the analysis "requires careful interpretation of each claim in the light of its supporting disclosure." Johnson, 589 F.2d at 1079, 200 USPQ at 208. See also id. at 1078-79, 200 USPQ at 208 ("the flow diagrams which form part of the specification disclose explicit mathematical equations which are to be used in conjunction with each of these [claimed] steps [of 'determining' or 'correlating']"); Waldbaum, 559 F.2d 611, 194 USPQ 465 ("series of steps for manipulating binary numbers within a procedure for calculating the number of binary 1's and 0's present" was considered a mathematical algorithm. Gelnovatch, 595 F.2d at 39, 2001 USPQ at 143); In re Sherwood, 613 F.2d 809, 818, 204 USPQ 537, 545 (CCPA 1980), cert. denied, 450 U.S. 994 (1981) ("claims must be said to include the indirect recitation of a mathematical equation"); Meyer, 688 F.2d at 795, 215 USPQ at 198 (claims indirectly "recite a mathematical algorithm, which represents a mental process that a neurologist should follow").
2. Step 2 -- is the mathematical algorithm "applied in any manner to physical elements or process steps?" The second test is to determine whether the mathematical algorithm is "applied in any manner to physical elements or process steps." The guideline for the analysis should be the CCPA's suggestion in Abele to view the claim without the mathematical algorithm to determine whether what remains is "otherwise statutory"; if it is, it does not become nonstatutory simply because it uses a mathematical algorithm. It is recognized that "[t]he line between a patentable 'process' and an unpatentable 'principle' is not always clear." Flook, 437 U.S. at 589, 198 USPQ at 197.
There are no definitive "tests for determining whether a claim positively recites statutory subject matter." Meyer, 688 F.2d at 796 n.4, 215 USPQ at 198 n.4. Nevertheless, some useful guidelines may be synthesized out of the court decisions.
a. Post-solution activity
If the only limitation aside from the mathematical algorithm is insignificant or non-essential "post-solution activity," the claimed subject matter is nonstatutory, Flook, 437 U.S. at 5900, 198 USPQ at 197:
The notion that post-solution activity . . . can transform an unpatentable principle into a patentable process exalts form over substance. A competent draftsman could attach some form of post-solution activity to almost any mathematical formula; the Pythagorean theorem would not have been patentable, or partially patentable, because a patent application contained a final step indicating that the formula, when solved, could be usefully applied to existing surveying techniques.
Insignificant post-solution activity by itself is insufficient to constitute a statutory process. In Flook, the final step of adjusting an alarm limit was not sufficient. See also Safe Flight (final step of "means for processing and windshear signal to provide an indication representing the magnitude thereof" not sufficient); Abele, 684 F.2d at 909, 214 USPQ at 688 (final step of display; "that the result is displayed as a shade of gray rather than as simply a number provides no greater or better information, considering the broad range of applications encompassed by the claims"); Walter, 618 F.2d at 770, 205 USPQ at 4009 (final step in dependent claim of
magnetic recording: "If $ 101 could be satisfied by the mere recordation of the results of a nonstatutory process on some record medium, even the most unskilled patent draftsman could provide for such a step"); Gelnovatch, 595 F.2d at 41 n.7, 201 USPQ at 145 n.7 (final step of storing outputs: "each of the steps of the claimed process, except perhaps the final step of equating the process outputs to the values of the last set of process inputs, directly or indirectly recites a mathematical computation"); Sarkar, 588 F.2d at 1332 n.6, 200 USPQ at 136 n.6 (final step of constructing an obstruction at a location determined by a mathematical model: "Sarkar no longer relies upon bridge of dam construction as post-solution activity steps effective to bring his process within $ 101"); de Castelet, 562 F.2d at 1244, 195 USPQ at 446 (final step of transmitting; "That the computer is instructed to transmit electrical signals, representing the result of its calculations . . . does not transform the claim into one for a process merely using an algorithm" ). The absence of post-solution activity to the fact that any post-solution activity may be trivial is only one factor to be considered. On one hand, as stated in Walter, 618 F.2d at 767-68, 205 USPQ at 407: if the end-product of a claimed invention is a pure number, as in Benson and Flook, the invention is nonstatutory regardless of any post-solution activity which makes it available for use by a person or machine for other purposes.
On the other hand, as stated in Abele, 684 F.2d at 908 n.9, 214 USPQ at 687 n.9:
"the fact that [the] equation is the final step is not determinative of the section 101 issue." In re Richman, 563 F.2d at 1030, 195 USPQ at 343. Accord, In re Taner, 681 F.2d 787 ([CCPA] (1982), overruling In re Christensen, 478 F.2d 1392, 178 USPQ 35 ([CCPA] 1973). The particular order of the steps should not be determinative of the statutory subject matter inquiry.
b. Field of use limitations
A mathematical algorithm is not made statutory by "attempting to limit the use of the formula to a particular technological environment." Diehr, 450 U.S. at 191, 209 USPQ at 10. Thus, "field of use" or "end use" limitations in the claim preamble are insufficient to constitute a statutory process. This is consistent with the usual treatment of preambles as merely setting forth the environment. See Flook (the preamble while limiting the application of the claimed method to "a process comprising the catalytic chemical conversion of hydrocarbons" did not serve to render the method statutory); Walter, 618 F.2d at 769, 205 USPQ at 409 ("Although the claim
preambles relate the claimed invention to the art of seismic prospecting, the claims themselves are not drawn to methods of or apparatus for seismic prospecting"); de Castelet, 562 F.2d at 1244 n.6. 195 USPQ at 446 n.6 ("The potential for misconstruction of preamble language requires that compelling reason exist before that language may be given weight"). Compare Waldbaum, 559 F.2d at 616 n.6. 194 USPQ 469 n.6 (portion of preambles referred to in method portion of claims "are necessary for completeness of the claims and are proper limitations thereto").
c. Data-gathering steps
If the only limitations in the claims in addition to the mathematical algorithm are data-gathering steps which "merely determine values for the variables used in the mathematical formulae used in making the calculations." Such antecedent steps are insufficient to change a nonstatutory method of calculation into a statutory process. See In re Richman, 563 F.2d at 1030. 195 USPQ at 343; Sarkar. 588 F.2d at 1335. 200
USPQ at 139 ("If the steps of gathering and substituting values were alone sufficient, every mathematical equation, formula, or algorithm having any practical use would be per se subject to patenting as a 'process' under $ 101"): Gelnovatch, 595 F.2d at 41 n.7. 201 USPQ at 145 n.7 ("claimed step of perturbing the values of a set of process inputs (step 3), in addition to being a mathematical operation, appears to be a data-gathering step"). Where the claim "presents data gathering steps not dictated by the algorithm but by other limitations which require certain antecedent steps" the claim may present statutory subject matter. Abele, 684 F.2d at 908, 214 USPQ at 687.
d. Transformation of something physical
In determining whether the claim recites a statutory process or a nonstatutory mathematical algorithm, it is useful to analyze whether there is transformation of something physical into a different form. One distinction is made between transformation of physical "signals" from one physical state to a different physical state, a statutory process in the electrical arts, and mere mathematical manipulation of "data" which, by itself, is not a statutory process. Compare Tuner (conversion of
"substantially spherical seismic signals" into "a form representing the earth's response to cylindrical or plane waves" was statutory process): Sherwood 613 F.2d at 819, 204 USPQ at 546 (conversion of amplitude-versus-time seismic traces into amplitude-versus-depth seismic traces was statutory process because it "converts one physical thing into another physical thing just as any other electrical circuitry would do"); and Johnson (technique for removing unwanted noise from a seismic trace was statutory process); with Walter, 618 F.2d at 768, 770, 205 USPQ at 407, 409 (if "the claimed invention produces a physical thing . . . the fact that it is represented in numerical form does not render the claim nonstatutory" but finding that the "signals" claimed "may represent either physical quantities or abstract quantities" and thus were to the algorithm itself and not a particular application); Richman (method of calculating airborne radar boresight correction angle from 'a plurality of signal sets" not statutory); Gelnovatch, 595 F.2d at 42, 201 USPQ at 145 (where "the claims solely recite a method whereby a set of numbers is computed from a different set of numbers by merely performing a series of mathematical computations, the claims do not set forth a statutory process"); and Benson (conversion of binary coded decimal numbers into pure binary numbers not statutory). It is manifest that the statutory nature of the subject matter does not depend on the labels "signals" or "data."
e. Structural limitations in process claims
Another issue is the effect of structural limitations in method claims. While structural limitations in method claims are not improper, they are usually not entitled to patentable weight unless they somehow affect or form an essential part of the process. See Benson, 409 U.S. at 73, 175 USPQ at 677 (claim 8 recited use of a "reentrant shift register"): Waldbaum, 559 F.2d at 66, 194 USPQ at 469 (machine limitations in data processor method claims); de Castelet, 562 F.2d at 1244, 195 USPQ at 47 ("Claims to nonstatutory processes do not automatically and invariably become patentable upon incorporation of reference to apparatus"). The related problem of specific structural language in apparatus claims has been treated. supra, in section II.C.1.b.
D. Examples
1. Diamond v. Diehr
The following claim was held to recite statutory subject matter.
1. A method of operating a rubber-molding press for precision molded compound with the aid of a digital computer, comprising:
providing said computer with a data base for said press including at least. natural logarithm conversion data (ln); the activation energy constant (C) unique to each batch of said compounded being molded;
and
a constant (x) dependent upon the geometry of the particular mold of the press;
initiating an interval timer in said computer upon the closure of
the press for monitoring the elapsed time of said closure;
constantly determining the temperature (Z) of the mold at a location
closely adjacent to the mold cavity in the press during molding;
constantly providing the computer with the temperature (Z);
respectively calculating in the computer, at frequent intervals
during each cure, the Arrhenius equation for reaction time during
the cure, which is ln v=CZ+x, where v is the total required cure
time. repetitively comparing in the computer at said frequent
intervals during the cure each said calculation of the total
required cure time calculated with the Arrhenius equation and said
elapsed time, and opening the press automatically when a said
comparison indicates equivalence.
Step 1 The claim contains an equation for controlling the in-mold time: In v=CZ + x.
Step 2 The claimed subject matter is statutory because it recites an "otherwise statutory" process in addition to the mathematical algorithm. As stated in Abele, 684 F.2d at 907. 214 USPQ at 686:
In Diehr, were the claims to be read without the algorithm, the process would still be a process for curing rubber, although it might not work as well since the in-mold time would not be as accurately controlled. The steps in the process, 450 U.S. at 187, 209 USPQ at 8: include installing rubber in a press, closing the mold, constantly determining the temperature of the mold, constantly recalculating the appropriate cure time through the use of the formula and a digital computer, and automatically opening the press at the proper time. The statutory nature of the claim is not based on the post-solution activity of opening the press, but on the application of the mathematical algorithm to the whole process.
2. Parker v. Flook
The following claim in Flook was held to recite nonstatutory subject matter.
1. A method for updating the value of at least one alarm limit on at least one process variable involved in a process comprising the catalytic chemical conversion of hydrocarbons wherein said alarm limit has a current value of Bo + K wherein Bo is the current alarm base and K is a predetermined alarm offset which comprises:
(1) determining the present value of said process variable said
present value being defined as PVL:
(2) determining a new alarm base B1 using the following equation:
B1 = Bo(1.0 - F) + PVL(F)
where F is a predetermined number greater than zero and less than
1.0:
(3) determining an updated alarm limit which is defined as B1 + K:
and thereafter
(4) adjusting said alarm limit to said updated alarm limit value.
Step 1 The claim contains a mathematical algorithm comprising determining a new alarm base in step (2) and computing an "alarm limit" in step (3).
Step 2 When viewed without the steps of the mathematical algorithm, steps (2) and (3), the only limitations remaining are the preamble limitation restricting the field of use to "a process comprising the catalytic chemical conversion of hydrocarbons;" the data- gathering step of step (1); and the post-solution step of step (4). None of these limitations comprises an "otherwise statutory" process. The claim seeks to protect a method for computing an "alarm limit" rather than the application of the computation within an otherwise statutory process.
3. In re Abele
In Abele, claim 5 was held to recite nonstatutory subject matter under $ 101 whereas dependent claim 6 was statutory.
5. A method of displaying data in a field comprising the steps of calculating the difference between the local value of the data at a data point in the field and the average value of the data in a region of the field which surrounds said point for each point in said field, and displaying the value of said difference as a signed gray scale at a point in a picture which corresponds to said data point.
7. The method of claim 5 wherein said data is X-ray attenuation data produced in a two dimensional field by a computed tomography scanner. Step 1 Claim 5 contains a mathematical algorithm, "calculating the difference," which is defined in the specification as a Gaussian weighting function. Step 2 When claim 5 is viewed without the mathematical algorithm, the only remaining limitation is the post- solution activity of displaying the result. The display by itself did not constitute an "otherwise statutory" process. The court held that "the algorithm is neither explicitly nor implicitly applied to any certain process." 684 F.2d at 909, 214 USPQ at 688. However, when dependent claim 6 is added to the limitations of claim 5,
684 F.2d at 908, 214 USPQ at 687-88:
Were we to view the claim absent the algorithm, the production, detection and display steps would still be present and would result in a conventional CAT-scan process. . . . [W]e view the production, detection, and display steps as manifestly statutory subject matter and are not swayed from this conclusion by the presence of an algorithm in the claimed method.
III. Computer Programs
A. "Computer programs" versus "computer processes"
A "process" or " algorithm" is a step-by-step procedure to arrive at a given result. In the patent area, a "computer process" or "computer algorithm" is a process, i.e., a series of steps, which is performed by a computer. A "[computer] program is a sequence of coded instructions for a digital computer. Benson, 409 U.S. at 65. 175 USPQ at 674. Computer programs are equivalently known as "software." Unfortunately for discussion in this area, "[b]oth the series of steps performed by a computer, and the software directing those steps, have acquired the name "computer program."
Gelnovatch, 595 F.2d at 45 n.5, 201 USPQ at 148 n.5 (Markey, C.J., dissenting). What is sought to be protected by patent is the underlying process. As stated in Gelnovatch, 595 F.2d at 44, 201 USPQ at 147: Confusion may be avoided if it be realized that what is at issue is not the "program," i.e., the software, but the process steps which the software directs the computer to perform.
See, e.g., Maucorps, 609 F.2d at 483, 203 USPQ at 814 ("The [claimed] invention is implemented via a computer program written in FORTRAN IV, either built into the calculating machine, or loaded into a general purpose computer").
B. Statutory nature of computer processes
1. The Supreme Court has not ruled on the patentability of computer programs.
The Supreme Court has not ruled on whether computer process are per se statutory or nonstatutory. The decisions in Benson, Flook and Diehr all dealt with claims viewed as mathematical algorithms. In Benson and Diehr, the claims contained mathematical algorithms implemented by a computer.
In Benson, the Court held that the claims preempted the use of the mathematical algorithm, but did not hold that "any program servicing a computer" would be nonstatutory. In Diehr, the Court held that the claims otherwise defined a statutory process for curing rubber, and that the inclusion of a mathematical algorithm or computer program did not make claim nonstatutory. The claim in Flook did not involve a computer process.
In Dann v. Johnson, 425 U.S. 219, 189 USPQ 257 (1976), rev'g on other grounds, In re Johnson, 502 F.2d 765, 183 USPQ 172 (CCPA 1974), which involved a "machine system for automatic record-keeping of bank checks and deposits," the Court declined to discuss the $ 101 issue of the general patentability of computer programs, 425 U.S. at 220, 189 USPQ at 258:
We find no need to treat that question in this case, however, because we conclude that in any event respondent's system is unpatentable on grounds of obviousness. 35 U.S.C. $ 103.
In Diamond v. Bradley, an equally divided Supreme Court affirmed the CCPA's decision in Bradley. The claims were directed to computer "firmware," which refers to microinstructions permanently embodied in hardware elements, and not to a computer application or process. The CCPA found that the claims literally recited a machine and that, in applying the two-part test of Freeman, the claims did not recite a mathematical algorithm.
2. The CCPA has held that computer processes are statutory unless they fall within a judicially determined exemption. In Pardo, the most recent CCPA case on computer processes, the CCPA stated that, 684 F.2d at 916, 214 USPQ at 677: any process, machine, manufacture, or composition of matter constitutes statutory subject matter unless it falls within a judicially determined exception to section 101. The major (and perhaps only) exception in the area of computer processes is the mathematical algorithm. Although not binding precedent on the Federal Circuit, the district court in Paine, Webber, Jackson & Curtis, Inc. v. Merill, Lynch, Lynch, Pierce, Fenner &
Smith, 564 F.Supp. 1358, 1367, 218 USPQ 212, 218 (D. Del. 1983) stated:
The CCPA [has] . . . held that a computer algorithm, as opposed to a mathematical algorithm, is patentable subject matter.
If a computer process claim does not contain a mathematical algorithm in the Benson sense, the second step of the Freeman-Walter-Abele test is not reached, and the claimed subject matter will usually be statutory.
The traditional approach by the CCPA to the PTO's rejection of computer processes as nonstatutory subject matter has been to apply the two-part test for mathematical algorithms and to find statutory subject matter if the claims do not recite a mathematical algorithm. See Pardo, 684 F.2d at 916, 214 USPQ at 676 (process for converting source program into object program: "we are unable to find any mathematical formula, calculation, or algorithm either directly or indirectly recited in the claimed steps of examining, compiling, storing, and executing"); In re Toma, 575 F.2d 872, 877, 197 USPQ 852, 856 (CCPA 1978) (process for translating a source natural language, e.g., Russian, to a target natural language, e.g., English: "[we] are unable to find any direct or indirect recitation of a procedure for solving a mathematical problem"); In re Phillips, 608 F.2d 879, 883, 203 USPQ 971, 975 (CCPA 1979) (process for preparing architectural specifications: "Our analysis of the claims on appeal reveals no recitation, directly or indirectly, of an algorithm in the Benson and Flook sense"); Freeman, 573 F.2d at 1246, 197 USPQ at 471 ("The method
claims here at issue do not recite process steps which are themselves mathematical calculations, formulae, or equations"); Deutsch, 553 F.2d 689, 692, 193 USPQ 645, 648
(CCPA 1977) (method of operating a system of manufacturing plants: "Nothing in the methods claimed by Deutsch preempts a mathematical formula, an algorithm, or any specific computer program"); Chatfield, 545 F.2d at 158, 191 USPQ at 736 (method of reassigning priorities within a computer. "[the] independent claims contain neither a mathematical formula nor a mathematical algorithm" ).
If the computer process is found to contain a mathematical algorithm, it must then pass the second part of the Freeman- Walter-Abele test for statutory subject matter. See. e.g., Sherwood; Maucorps; Gelnovatch.
Arguably, other exceptions such as "methods of doing business" and "mental steps" may be raised if a claim is not a true computer process but merely recites that an otherwise nonstatutory process is performed on a computer. de Castelet, 562 F.2d at 1244, 195 USPQ at 447 ("Claims to nonstatutory processes do not automatically and invariable become patentable upon incorporation of reference to apparatus"). These would appear to be exceptions with very narrow application to claims which are not limited to implementation by a machine. For example, while a "method of doing business" per se is not statutory subject matter, "a method of operation on a computer to effectuate a business activity" has been held to be statutory subject
matter. Paine, Webber v. Merrill Lynch, 564 F.Supp. at 1369, 218 USPQ at 220. See also Deutsch, 553 F.2d at 692 n.5. 193 USPQ at 648 n.5 (claims were not a method of doing business because "[t]hey do not merely facilitate business dealings"); Johnston, rev'd on other grounds. Dann v. Johnston (apparatus claims directed to system for automatic record-keeping of bank checks and deposits did not cover a method of doing business). Similarly, machine or computer implementation of "mental steps" is statutory subject matter. Prater: In re Bernhart, 417 F.2d 1395, 163 USPQ 611 (CCPA 1969); In re Musgrave, 431 F.2d 882, 167 USPQ 280 (CCPA 1970). See also Toma (computer implemented method for translation of natural languages is statutory).
Chronological Order Case List
In re Prater, 415 F.2d 1393, 162 USPQ 541 (CCPA 1969)
In re Bernhart, 417 F.2d 1395, 163 USPQ 611 (CCPA 1969)
In re Musgrave, 431 F.2d 882, 167 USPQ 280 (CCPA 1970)
Gottschalk v. Benson, 409 U.S. 63, 175 USPQ 673 (1972)
In re Christensen, 478 F.2d 1392, 178 USPQ 35 (CCPA 1973)
Dann v. Johnston, 425 U.S. 219, 189 USPQ 257 (1976), rev'd on other grounds.
In re Johnston, 502 F.2d 765, 183 USPQ 172 (CCPA 1974)
In re Noll, 545 F.2d 141, 191 USPQ 721 (CCPA 1976), cert, denied, 434 U.S.
875, 195 USPQ 465 (1977)
In re Chattield, 545 F.2d 152, 191 USPQ 730 (CCPA 1976). cert. denied, 434
U.S. 875, 195 USPQ 465 (1977)
In re Deutsch, 553 F.2d 689, 193 USPQ 645 (CCPA 1977)
In re Waldbaum, 559 F.2d 611, 194 USPQ 465 (CCPA 1977)
In re Richman, 563 F.2d 1026, 195 USPQ 340 (CCPA 1977)
In re de Castelet, 562 F.2d 1236, 195 USPQ 439 (CCPA 1977)
In re Freeman, 573 F.2d 1237, 197 USPQ 464 (CCPA 1978)
In re Toma, 575 F.2d 872, 197 USPQ 852 (CCPA 1978)
Parker v. Flook, 437 U.S. 584, 198 USPQ 193 (1978)
In re Sarkar, 588 F.2d 1330, 200 USPQ 132 (CCPA 1978)
Hirschfeld v. Banner, 462 F.Supp. 135, 200 USPQ 276 (D.D.C. 198), aff'd
without opinion, 615 F.2d 1368 (D.C. Cir. 1980). cert. denied, 450 U.S.
994, 210 USPQ 776 (1981)
In re Gelnovatch, 595 F.2d 32, 201 USPQ 136 (CCPA 1979)
In re Maucorps, 609 F.2d 481, 203 USPQ 812 (CCPA 1979)
In re Phillips, 608 F.2d 879, 203 USPQ 971 (CCPA 1979)
In re Sherwood, 613 F.2d 809, 204 USPQ 537 (CCPA 1980). cert. denied, 450
U.S. 994, 210 USPQ 776 (1981)
In re Walter, 618 F.2d 758, 205 USPQ 397 (CCPA 1980)
Arshal v. United States, 621 F.2d 421, 208 USPQ 397 (Ct. Cl.
1980), cert. denied, 449 U.S. 1088 (1981). reh'g denied, 450
U.S. 1050 (1981)
Diamond v. Diehr, 450 U.S. 175, 209 USPQ 1 (1981)
Diamond v. Bradley, 45 U.S. 381, 209 USPQ 97 (1981). aff'g
by an equals divided Court. In re Bradley, 600 F.2d 807, 202
USPQ 480 (CCPA 1979)
In re Pardo, 684 F.2d 912, 214 USPQ 673 (CCPA 1982)
In re Taner, 681 F.2d 787, 214 USPQ 678 (CCPA 1982)
In re Abele, 684 F.2d 902, 214 USPQ 682 (CCPA 1982)
In re Meyer, 688 F.2d 789, 215 USPQ 193 (CCPA 1982)
Paine, Webber, Jackson & Curtis, Inc. v. Merrill Lynch,
Pierce, Fenner & Smith, 564 F.Supp. 1358, 218 USPQ 212 (D. Del. 1983)
Safe Flight Instrument Corp. v. Sundstrand Data Control Inc., 706 F.Supp.
1146, 10 USPQ2d 1733 (D. Del. 1989)
August 9, 1989. FRED E. McKELVEY, Solicitor
Table of Contents
I. STATUTORY SUBJECT MATTER: 35 U.S.C. $ 101
II. MATHEMATICAL ALGORITHMS
A. Mathematical algorithms per se are not a statutory "process"
under $ 101
B. Evolution of the two-part test for mathematical
algorithm-statutory subject matter
C. Application of the two-part test
1. Step 1 -- presence of a mathematical algorithm
a. Mathematical algorithm
b. "Process" versus "apparatus" claims
c. Form of the mathematical algorithm
2. Step 2 -- is the mathematical algorithm "applied in any
manner to physical elements or process steps?"
a. Post-solution activity
b. Field of use limitations
c. Data-gathering steps
d. Transformation of something physical
e. Structural limitations in process claims
D. Examples
1. Diamond v. Diehr
2. Parker v. Floor
3. In re Abele
III. COMPUTER PROGRAMS
A. "Computer programs" versus "computer processes"
B. Statutory nature of computer processes
1. The Supreme Court has not ruled on the patentability of
computer programs
2. The CCPA has held that computer processes are statutory
unless they fall within a judicially determined exception
Discussion
I. Statutory Subject Matter: 35 U.S.C. $ 101
Inventions may be patented only if they fall within one of the four statutory classes of subject matter of 35 U.S.C. $ 101: "process, machine, manufacture, or composition of matter." See Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 483, 181 USPQ 673, 679 (1974):
[N]o patent is available for a discovery, however useful, novel, and nonobvious, unless it falls within one of the express categories of patentable subject matter of 35 U.S.C. $ 101.
Subject matter that does not fall within one of the statutory classes of 35 U.S.C. $ 101 is said to be "nonstatutory" or to be "unpatentable subject matter." The broad language of $ 101 is intended to delineate a "general industrial boundary" of patentable invention. In re Bergy, 596 F.2d 952, 974 n.11, 201 USPQ 352, 372 n.11 (CCPA 1979), vacated, 444 U.S. 1028, aff'd sub nom., Diamond v. Chakrabarty, 447 U.S. 303, 206 USPQ 193 (1980). The first statutory class, process, is defined in 35 U.S.C. $ 100(b) and refers to acts, while the last three classes, machine, manufacture and composition of matter, refer to physical things; therefore, the general field of patentable invention consists of new acts and new things. Id. The classes relevant to this discussion are "process" and "machine." A "process" is equivalent to a "method." Bergy 596 F.2d at 965, 201 USPQ at 364. The term "machine" is used interchangeably with "apparatus." In re Prater, 415 F.2d 1393, 1395 n.11,
162 USPQ 541, 543 n.11 (CCPA 1969).
The question of whether a claimed invention satisfies the other conditions for patentability is "wholly apart from whether the invention falls into a category of statutory subject matter" (emphasis deleted). Diamond v. Diehr, 450 U.S. 175, 190, 209 USPQ 1, 9 (1981) (citing Bergy, 596 F.2d at 961, 201 USPQ at 361). As stated in Parker v. Flook, 437 U.S. 584, 593, 198 USPQ 193, 198-99 (1978):
The obligation to determine what type of discovery is sought to be patented must precede the determination of whether that discovery is, in fact, new [i.e., novel under $ 102] or obvious [$ 103].
See also In re Sarkar, 588 F.2d 1330, 1333 n.10, 200 USPQ 132, 137 n.10 (CCPA 1978) ("If the subject matter as claimed is subject to patenting, i.e., if it falls within $ 101, it must them be examined for compliance with $$ 102 and 103"). Legislative history indicates that Congress contemplated that the subject matter provisions be given a broad construction and were intended to "include anything under the sun that is made by man." Diamond v. Chakrabarry, 447 U.S. at 309, 206 USPQ at 197. Any process, machine, manufacture, or composition of matter constitutes statutory subject matter unless it falls within a judicially determined exception to $ 101. In re Pardo, 684 F.2d 912, 916, 214 USPQ 673, 677 (CCPA 1982). Exceptions include laws of nature, physical phenomena and abstract ideas. Diehr, 450 U.S. at 185, 209 USPQ at 7, and cases cited therein. This analysis addresses whether mathematical algorithms and computer programs are statutory subject matter.
II. Mathematical Algorithms
A. Mathematical algorithms per se are not a statutory "process" under $ 101
A mathematical algorithm is defined as a "procedure for solving a given type of mathematical problem." Gottschalk v. Benson, 409 U.S. 63, 65, 175 USPQ 673, 674 (1972); Flook, 437 U.S. at 585 n.1. 198 USPQ at 195 n.1: Diehr, 450 U.S. at 186, 209 USPQ at 8. Mathematical algorithms are non- statutory because they have been determined not to fall within the $ 101 statutory class of a "process." Benson. "[A]n algorithm, or mathematical formula, is like a law of nature, which cannot be the subject of a patent." Diehr, 450 U.S. at 186, 209 USPQ at 8. The exception applies only to mathematical algorithms since any process is an " algorithm" in the sense that it is a step-by-step procedure to arrive at a given result. In re Walter, 618 F.2d 758, 764 n.4, 205 USPQ 397, 405 n.4, (CCPA 1980); Pardo, 684 F.2d at 915,
214 USPQ at 676.
Although mathematical algorithms per se are nonstatutory, as stated in Diehr, 450 U.S. at 187-88, 209 USPQ at 8-9:
[A] claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula, computer program, or digital computer. . . .
[I]n Parker v. Flook we stated that "a process is not unpatentable simply because it contains a law of nature or a mathematical algorithm. " 437 U.S. at 590. It is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection. As Justice Stone explained four decades ago: "While a scientific truth, or the mathematical expression of it, is not a patentable invention, a novel and useful structure created with the aid and knowledge of scientific truth may be."
Mackay Radio & Telegraph Co. v. Radio Corp. of America, 306 U.S. 86, 94 (1939). [Citations omitted]. The Supreme Court thus recognizes that mathematical algorithms are "the basic tools of scientific and technological work." Benson, 409 U.S. at 67, 175 USPQ at 674, and should not be the subject of exclusive rights, whereas technological application of scientific principles and mathematical algorithms furthers the constitutional purpose of promoting "the Progress of . . . Useful arts." U.S. Const. art. I, $ 8. It is also recognized that mathematical algorithms may be the most precise way to described the invention.
Where claims involve mathematical algorithms, as stated in In re Abele, 684 F.2d 902, 907, 214 USPQ 687 (CCPA 1982): The goal is to answer the question "What did applicants invent?" If the claimed invention is a mathematical algorithm, it is improper subject matter for patent protection, whereas if the claimed invention is an application of the algorithm, $ 101 will not bar the grant of a patent.
The tests for determining whether claims containing mathematical algorithms are statutory have gradually evolved in the courts since the Supreme Court's decision in Benson in 1972.
B. Evolution of the two-part test for mathematical algorithm
-statutory subject matter
The proper legal analysis of mathematical algorithm
-statutory subject matter cases is the two-part test of In re Freeman, 573 F.2d 1237, 197 USPQ 464 (CCPA 1978), as modified by Walter and Abele. See In re Meyer, 688 F.2d 789, 796, 215 USPQ 193, 198 (CCPA 1982) ("A more comprehensive test for cases involving mathematical algorithms is set forth In re Abele"). A review of the evolution of the analysis provides some useful insights into the application of the test.
In Benson, the Supreme Court concluded that claims directed to a particular algorithm for converting binary coded decimal numbers to binary numbers was not statutory subject matter. The Supreme Court further concluded that any patent issued on those claims "would wholly preempt the mathematical formula and in practical effect would be a patent on the algorithm itself." 409 U.S. at 72. 175 USPQ at 676. These two conclusions formed the basis for the two-part analysis of the Court of Customs and Patent Appeals (CCPA) in Freeman, 573 F.2d at 1245, 197 USPQ at 471:
First, it must be determined whether the claim directly or indirectly recites an " algorithm" in the Benson sense of that term, for a claim which fails even to recite an algorithm clearly cannot wholly preempt an algorithm.
Second, the claim must be further analyzed to ascertain whether in its entirety it wholly preempts that algorithm. In 1978, the Supreme Court held in Flook that a claim need "not . . . cover every conceivable application of the formula," to be nonstatutory, 437 U.S. at 586, 198 USPQ at 196. This decision left undefined what constitutes statutory subject matter. In Walter, the CCPA modified the second step of Freeman to require a more positive approach to determining what is claimed, 618 F.2d at 767, 205 USPQ at 407:
If it appears that the mathematical algorithm is implemented in a specific manner to define structural relationships between the physical elements of the claim (in apparatus claims) or to refine or limit claim steps (in process claims), the claim being otherwise statutory, the claim passes muster under $ 101. If, however, the mathematical algorithm is merely presented and solved by the claimed invention, as was the case in Benson and Flook, and is not applied in any manner to physical elements or process steps, no amount of post-solution activity will render the claim statutory; nor is it saved by a preamble merely reciting the field of use of the
mathematical algorithm.
The CCPA noted that while the second step of Freeman was "stated in terms of preemption" it had consistently been applied "in the spirit of the foregoing principles." 618 F.2d at 767, 205 USPQ at 407.
In Abele, the CCPA further modified the second part of the test to provide a more comprehensive test. 684 F.2d at 906- 7, 214 USPQ at 686:
Appellants summarize the Walter test as setting forth two ends of a spectrum: what is now clearly nonstatutory, i.e., claims in which an algorithm is merely presented and solved by the claimed invention (preemption), and what is clearly statutory, i.e., claims in which an algorithm is implemented in a specific manner to define structural
relationships between the physical elements of the claim (in an apparatus claim) or to refine or limit steps (in a process).
Appellants urge that the statement of the test in Walter fails to provide a useful tool for analyzing claims in the "gray area" which falls between the two ends of that spectrum. We agree that the board's understanding and application of the Walter analysis justifies appellant's position. However, the Walter analysis quoted above does not limit patentable subject matter only to claims in which structural relationships or process steps are defined, limited or refined by the application of the algorithm. Rather, Walter should be read as requiring no more than the algorithm be "applied in any manner to physical elements or process steps," provided that its
application is circumscribed by more than a field of use limitation or non-essential post-solution activity. Thus, if the claim would be "otherwise statutory," id., albeit inoperative or less useful without the algorithm, the claim likewise presents statutory subject matter when the algorithm is included.
This broad reading of Walter, we conclude, is in accord with the Supreme Court decisions [holding "that a claim drawn to subject matter otherwise statutory does not become nonstatutory simply because it uses a mathematical formula, computer program, or digital computer." Diamond v. Diehr, 450 U.S. at 187, 209 USPQ at 8].
The reason for the modification of the test was because, as noted in Abele, 684 F.2d at 909, 214 USPQ at 688:
The algorithm [in Abele] does not necessarily refine or limit the earlier steps of production and detection as would be required to achieve the status of patentable subject matter by the board's narrow reading of Walter.
The second test of Abele suggests that the determination of whether the algorithm is "applied in any manner to physical element or process steps" may be made by viewing the claims without the algorithm and determining whether what remains is "otherwise statutory." This analysis focuses on identifying the statutory process in the claim and is consistent with previous cases such as Walter, 618 F.2d at 769, 205 USPQ at 409 ("Examination of each claim demonstrates that each has no substance apart from the calculations involved" ). The technique of viewing the claim without the mathematical algorithm is not inconsistent with the requirement that claims must be considered "as a whole" under $ 101.
The requirement that claims be considered "as a whole" arose out of the now rejected "point of novelty" approach to statutory subject matter. Under the "point of novelty" approach, if a claim considered without the nonstatutory subject matter was unpatentable over the prior art (i.e., if the algorithm was at the "point of novelty" of the claim), the claims were found to not recite statutory subject matter. This approach was consistently rejected by the CCPA. See In re Chatfield, 545 F.2d 152, 191 USPQ 730 (CCPA 1976), cert. denied, 434 U.S. 875 (1977); In re Deutsch, 553 F.2d 689, 193 USPQ 645 (CCPA 1977); In re de Castelet, 562 F.2d 1236, 195 USPQ 439 (CCPA 1977); Freeman; Sarkar; Walter. The point of novelty approach was finally put to
rest in Diehr, 450 U.S. at 188-89, 209 USPQ at 9:
In determining the eligibility of respondents' claimed process for patent protection under $ 101, their claims must be considered as a whole. It is inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the analysis. . . . The "novelty" of any element or steps in a process, or even of the process itself, is of no relevance in determining whether the subject matter of a claim falls within the $ 101 categories of possibly patentable subject matter.
Under the second test of Abele, the claims are considered without the algorithm to determine whether what remains is "otherwise statutory," not to determine whether what remains is novel and nonobvious.
C. Application of the two-part test
1. Step 1 -- presence of a mathematical algorithm
a. Mathematical algorithm
A mathematical algorithm is a "procedure for solving a given type of mathematical problem." In this sense, a mathematical algorithm refers "to methods of calculation, mathematical formulas, and mathematical procedures generally." Walter, 618 F.2d at 764-65 n.4, 205 USPQ at 405 n.4. "The type of mathematical computation involved does not determine whether a procedure is statutory or nonstatutory." In re Gelnovatch, 595 F.2d 32, 41.201 USPQ 136, 145 (CCPA 1979). A "claim for an improved method of calculation, even when tied to a specific end use, is unpatentable subject matter under $101." Flook, 437 U.S. at 595 n.18, 198 USPQ at 199 n.18. Mathematical algorithms may represent scientific principles, laws of nature, or ideas or mental processes for solving complex problems. See Meyer, 688 F.2d at 794-95, 215 USPQ at 197:
Scientific principles, such as the relationship between mass and energy [E =mc^2], and laws of nature, such as the acceleration of gravity, namely a =32 ft/sec.^2, can be represented in mathematical format. However, some mathematical algorithms and formulae do not represent ideas or mental processes and are simply logical vehicles for communicating possible solutions to complex problems. See also Safe Flight Instrument Corp. v. Sundstrand Data Control, Inc., 706 F.Supp. 1146, 10 USPQ2d 1733 (D.Del. 1989) (mathematical algorithm representing a natural phenomenon, windshear).
No distinction is made between mathematical algorithms invented by man, and mathematical algorithms representing discoveries of scientific principles and laws of nature which reveal a relationship that has always existed.
b. "Process" versus "appears" claims
Since mathematical algorithms have been determined not to fall within the $101 statutory class of a "process," attempts have been made to circumvent the nonstatutory subject matter rejection by drafting mathematical algorithms as "machine" claims. The technique used is to draft the method steps in terms of "means for" language permitted by 35 U.S.C. $ 112, sixth paragraph. While such a claim is technically a "machine" or "apparatus" claim, the courts have held that form of the claim does not control whether the subject matter is statutory. See In re Maucorps, 609 F.2d 481, 485, 203 USPQ 812, 815-16 (CCPA 1979):
Labels are not determinative $ 101 inquiries. "Benson applies equally whether an invention is claimed as an apparatus or process, because the form of the claim is often an exercise in drafting." In re Johnson, 589 F.2d 1070, 1077, 200 USPQ 199, 206 ([CCPA] 1978). "Though a claim expressed in 'means for (functional) terms [under 35 U.S.C. $ 112, sixth paragraph] is said to be an apparatus claim, the subject matter as a whole of that claim may be indistinguishable from that of a method claim drawn to the steps performed by the 'means,'" In re Freeman, 573 F.2d at 1247, 197 USPQ at 472. Moreover, that the claimed computing system may be a "machine" within "the ordinary sense of the word," as appellant argues, is irrelevant. The holding in Benson "forecloses a purely literal reading of $ 101."
The test for determining whether "means for" apparatus claims should be treated as method claims is stated in Walter, 618 F.2d at 768, 205 USPQ at 408:
If the functionally-defined disclosed means and their equivalents are so broad that they encompass any and every means for performing the recited functions, the apparatus claim is an attempt to exalt form over substance since the claim is really to the method or series of functions itself . . . . In such cases the burden must be placed on the applicant to demonstrate that the claims are truly drawn to specific apparatus distinct from other apparatus capable of performing the identical functions.
If this burden has not been discharged, the apparatus claim will be treated as if it were drawn to the method or process which encompasses all of the claimed "means." See In re Maucorps, 609 F.2d at 485, 203 USPQ at 815-816: In re Johnson, 589 F.2d at 1077, 200 USPQ at 206: In re Freeman, 573 F.2d at 1247, 197 USPQ at 472. The statutory nature of the claim under $ 101 will then depend on whether the corresponding method is statutory.
See also Meyer, 688 F.2d at 795 n.3, 215 USPQ at 198 n.3; Abele, 684 F.2d at 909, 214 USPQ at 688; Pardo. 684 F.2d at 916 n.6. 214 USPQ at 677 n.6; Arshal v. United States, 621 F.2d 421, 427-28, 208 USPQ 397, 404 (Ct. Cl. 1980), cert. denied, 449 U.S. 1077 (1981), reh'g denied, 450 U.S. 1050 (1981). In Maucorps, the limitation of various "means" in claim 1 to include certain "electric circuits" did not prevent the claim from being treated as a method. A claim is not presumed to be statutory simply because it is in apparatus form.
c. Form of the mathematical algorithm
The first step of the analysis is to determine whether the claim directly or indirectly recites a mathematical algorithm. A mathematical algorithm can appear in many forms. As stated in Freeman, 573 F.2d at 1246, 197 USPQ at 471:
The manner in which a claim recites a mathematical algorithm may vary considerably. In some claims, a formula or equation may be expressed in traditional mathematical symbols so as to be immediately recognizable as a mathematical algorithm. See e.g., In re Richman, 563 F.2d 1026, 195 USPQ 340 ([CCPA] 1977); In re Flook, 559 F.2d 21, 195 USPQ 9([CCPA] 1977), cert. granted such nom, Parker v. Flook, [437 U.S. 584] (1978). Other claims may use prose to express a mathematical computation or to indirectly recite a mathematical equation or formula by means of a prose equivalent therefor. See, e.g., In re de Castelet, supra (claims 6 and 7); In re Waldhaum, 559
F.2d 611, 194 USPQ 465 ([CCPA] 1977). A claim which substitutes, for a mathematical formula in algebraic form, "words which mean the same thing," nonetheless recites an algorithm in the Benson sense. In re Richman, supra 563 F.2d at 1030, 195 USPQ at 344. Indeed, the claims at issue on Benson did not contain a formula equation expressed in mathematical symbols.
Claims which include mathematical formulas or calculations expressed in mathematical symbols clearly include a mathematical algorithm. Mathematical algorithms in prose form may be expressed as literal translations of the mathematical algorithm (e.g., substituting the expression "division" or "taking the ratio" for a diversion sign) or may be expressed in words which indicate the mathematical algorithm. See Safe Flight Instrument, 706 F.Supp. at 1148, 10 USPQ at 1734 (subtracting); Abele, 684 F.2d at 908 n. 8, 214 USPQ at 687 n.8 ("The algorithm, calculating the difference, is defined in the specification as a Gaussian weighting function"): In re Taner, 681 F.2d 787, 790, 214 USPQ 678, 681 (CCPA 1982) (summing); In re Johnson, 589 F.2d 1070, 1079, 200 USPQ 199, 208 (CCPA (1978) ("'computing' connotes the execution of the one of a sequence of mathematical operations"); In re Waldbaum, 559 F.2d 611, 194 USPQ 465 (CCPA 1977) (method of claim 1 "to count" the number of busy lines "solves a mathematical problem, to wit, counting a number of busy lines in a telephone system." In re Bradley, 600 F.2d 807, 810 n. 4, 202 USPQ 480, 484 n.4 (CCPA 1979), aff'd by an equally divided court sub nom.
Diamond v. Bradley, 450 U.S. 381, 209 USPQ 97 (1981)).
It is not always possible to determine by inspection of the claim whether it indirectly recites a mathematical algorithm; in such instances the analysis "requires careful interpretation of each claim in the light of its supporting disclosure." Johnson, 589 F.2d at 1079, 200 USPQ at 208. See also id. at 1078-79, 200 USPQ at 208 ("the flow diagrams which form part of the specification disclose explicit mathematical equations which are to be used in conjunction with each of these [claimed] steps [of 'determining' or 'correlating']"); Waldbaum, 559 F.2d 611, 194 USPQ 465 ("series of steps for manipulating binary numbers within a procedure for calculating the number of binary 1's and 0's present" was considered a mathematical algorithm. Gelnovatch, 595 F.2d at 39, 2001 USPQ at 143); In re Sherwood, 613 F.2d 809, 818, 204 USPQ 537, 545 (CCPA 1980), cert. denied, 450 U.S. 994 (1981) ("claims must be said to include the indirect recitation of a mathematical equation"); Meyer, 688 F.2d at 795, 215 USPQ at 198 (claims indirectly "recite a mathematical algorithm, which represents a mental process that a neurologist should follow").
2. Step 2 -- is the mathematical algorithm "applied in any manner to physical elements or process steps?" The second test is to determine whether the mathematical algorithm is "applied in any manner to physical elements or process steps." The guideline for the analysis should be the CCPA's suggestion in Abele to view the claim without the mathematical algorithm to determine whether what remains is "otherwise statutory"; if it is, it does not become nonstatutory simply because it uses a mathematical algorithm. It is recognized that "[t]he line between a patentable 'process' and an unpatentable 'principle' is not always clear." Flook, 437 U.S. at 589, 198 USPQ at 197.
There are no definitive "tests for determining whether a claim positively recites statutory subject matter." Meyer, 688 F.2d at 796 n.4, 215 USPQ at 198 n.4. Nevertheless, some useful guidelines may be synthesized out of the court decisions.
a. Post-solution activity
If the only limitation aside from the mathematical algorithm is insignificant or non-essential "post-solution activity," the claimed subject matter is nonstatutory, Flook, 437 U.S. at 5900, 198 USPQ at 197:
The notion that post-solution activity . . . can transform an unpatentable principle into a patentable process exalts form over substance. A competent draftsman could attach some form of post-solution activity to almost any mathematical formula; the Pythagorean theorem would not have been patentable, or partially patentable, because a patent application contained a final step indicating that the formula, when solved, could be usefully applied to existing surveying techniques.
Insignificant post-solution activity by itself is insufficient to constitute a statutory process. In Flook, the final step of adjusting an alarm limit was not sufficient. See also Safe Flight (final step of "means for processing and windshear signal to provide an indication representing the magnitude thereof" not sufficient); Abele, 684 F.2d at 909, 214 USPQ at 688 (final step of display; "that the result is displayed as a shade of gray rather than as simply a number provides no greater or better information, considering the broad range of applications encompassed by the claims"); Walter, 618 F.2d at 770, 205 USPQ at 4009 (final step in dependent claim of
magnetic recording: "If $ 101 could be satisfied by the mere recordation of the results of a nonstatutory process on some record medium, even the most unskilled patent draftsman could provide for such a step"); Gelnovatch, 595 F.2d at 41 n.7, 201 USPQ at 145 n.7 (final step of storing outputs: "each of the steps of the claimed process, except perhaps the final step of equating the process outputs to the values of the last set of process inputs, directly or indirectly recites a mathematical computation"); Sarkar, 588 F.2d at 1332 n.6, 200 USPQ at 136 n.6 (final step of constructing an obstruction at a location determined by a mathematical model: "Sarkar no longer relies upon bridge of dam construction as post-solution activity steps effective to bring his process within $ 101"); de Castelet, 562 F.2d at 1244, 195 USPQ at 446 (final step of transmitting; "That the computer is instructed to transmit electrical signals, representing the result of its calculations . . . does not transform the claim into one for a process merely using an algorithm" ). The absence of post-solution activity to the fact that any post-solution activity may be trivial is only one factor to be considered. On one hand, as stated in Walter, 618 F.2d at 767-68, 205 USPQ at 407: if the end-product of a claimed invention is a pure number, as in Benson and Flook, the invention is nonstatutory regardless of any post-solution activity which makes it available for use by a person or machine for other purposes.
On the other hand, as stated in Abele, 684 F.2d at 908 n.9, 214 USPQ at 687 n.9:
"the fact that [the] equation is the final step is not determinative of the section 101 issue." In re Richman, 563 F.2d at 1030, 195 USPQ at 343. Accord, In re Taner, 681 F.2d 787 ([CCPA] (1982), overruling In re Christensen, 478 F.2d 1392, 178 USPQ 35 ([CCPA] 1973). The particular order of the steps should not be determinative of the statutory subject matter inquiry.
b. Field of use limitations
A mathematical algorithm is not made statutory by "attempting to limit the use of the formula to a particular technological environment." Diehr, 450 U.S. at 191, 209 USPQ at 10. Thus, "field of use" or "end use" limitations in the claim preamble are insufficient to constitute a statutory process. This is consistent with the usual treatment of preambles as merely setting forth the environment. See Flook (the preamble while limiting the application of the claimed method to "a process comprising the catalytic chemical conversion of hydrocarbons" did not serve to render the method statutory); Walter, 618 F.2d at 769, 205 USPQ at 409 ("Although the claim
preambles relate the claimed invention to the art of seismic prospecting, the claims themselves are not drawn to methods of or apparatus for seismic prospecting"); de Castelet, 562 F.2d at 1244 n.6. 195 USPQ at 446 n.6 ("The potential for misconstruction of preamble language requires that compelling reason exist before that language may be given weight"). Compare Waldbaum, 559 F.2d at 616 n.6. 194 USPQ 469 n.6 (portion of preambles referred to in method portion of claims "are necessary for completeness of the claims and are proper limitations thereto").
c. Data-gathering steps
If the only limitations in the claims in addition to the mathematical algorithm are data-gathering steps which "merely determine values for the variables used in the mathematical formulae used in making the calculations." Such antecedent steps are insufficient to change a nonstatutory method of calculation into a statutory process. See In re Richman, 563 F.2d at 1030. 195 USPQ at 343; Sarkar. 588 F.2d at 1335. 200
USPQ at 139 ("If the steps of gathering and substituting values were alone sufficient, every mathematical equation, formula, or algorithm having any practical use would be per se subject to patenting as a 'process' under $ 101"): Gelnovatch, 595 F.2d at 41 n.7. 201 USPQ at 145 n.7 ("claimed step of perturbing the values of a set of process inputs (step 3), in addition to being a mathematical operation, appears to be a data-gathering step"). Where the claim "presents data gathering steps not dictated by the algorithm but by other limitations which require certain antecedent steps" the claim may present statutory subject matter. Abele, 684 F.2d at 908, 214 USPQ at 687.
d. Transformation of something physical
In determining whether the claim recites a statutory process or a nonstatutory mathematical algorithm, it is useful to analyze whether there is transformation of something physical into a different form. One distinction is made between transformation of physical "signals" from one physical state to a different physical state, a statutory process in the electrical arts, and mere mathematical manipulation of "data" which, by itself, is not a statutory process. Compare Tuner (conversion of
"substantially spherical seismic signals" into "a form representing the earth's response to cylindrical or plane waves" was statutory process): Sherwood 613 F.2d at 819, 204 USPQ at 546 (conversion of amplitude-versus-time seismic traces into amplitude-versus-depth seismic traces was statutory process because it "converts one physical thing into another physical thing just as any other electrical circuitry would do"); and Johnson (technique for removing unwanted noise from a seismic trace was statutory process); with Walter, 618 F.2d at 768, 770, 205 USPQ at 407, 409 (if "the claimed invention produces a physical thing . . . the fact that it is represented in numerical form does not render the claim nonstatutory" but finding that the "signals" claimed "may represent either physical quantities or abstract quantities" and thus were to the algorithm itself and not a particular application); Richman (method of calculating airborne radar boresight correction angle from 'a plurality of signal sets" not statutory); Gelnovatch, 595 F.2d at 42, 201 USPQ at 145 (where "the claims solely recite a method whereby a set of numbers is computed from a different set of numbers by merely performing a series of mathematical computations, the claims do not set forth a statutory process"); and Benson (conversion of binary coded decimal numbers into pure binary numbers not statutory). It is manifest that the statutory nature of the subject matter does not depend on the labels "signals" or "data."
e. Structural limitations in process claims
Another issue is the effect of structural limitations in method claims. While structural limitations in method claims are not improper, they are usually not entitled to patentable weight unless they somehow affect or form an essential part of the process. See Benson, 409 U.S. at 73, 175 USPQ at 677 (claim 8 recited use of a "reentrant shift register"): Waldbaum, 559 F.2d at 66, 194 USPQ at 469 (machine limitations in data processor method claims); de Castelet, 562 F.2d at 1244, 195 USPQ at 47 ("Claims to nonstatutory processes do not automatically and invariably become patentable upon incorporation of reference to apparatus"). The related problem of specific structural language in apparatus claims has been treated. supra, in section II.C.1.b.
D. Examples
1. Diamond v. Diehr
The following claim was held to recite statutory subject matter.
1. A method of operating a rubber-molding press for precision molded compound with the aid of a digital computer, comprising:
providing said computer with a data base for said press including at least. natural logarithm conversion data (ln); the activation energy constant (C) unique to each batch of said compounded being molded;
and
a constant (x) dependent upon the geometry of the particular mold of the press;
initiating an interval timer in said computer upon the closure of
the press for monitoring the elapsed time of said closure;
constantly determining the temperature (Z) of the mold at a location
closely adjacent to the mold cavity in the press during molding;
constantly providing the computer with the temperature (Z);
respectively calculating in the computer, at frequent intervals
during each cure, the Arrhenius equation for reaction time during
the cure, which is ln v=CZ+x, where v is the total required cure
time. repetitively comparing in the computer at said frequent
intervals during the cure each said calculation of the total
required cure time calculated with the Arrhenius equation and said
elapsed time, and opening the press automatically when a said
comparison indicates equivalence.
Step 1 The claim contains an equation for controlling the in-mold time: In v=CZ + x.
Step 2 The claimed subject matter is statutory because it recites an "otherwise statutory" process in addition to the mathematical algorithm. As stated in Abele, 684 F.2d at 907. 214 USPQ at 686:
In Diehr, were the claims to be read without the algorithm, the process would still be a process for curing rubber, although it might not work as well since the in-mold time would not be as accurately controlled. The steps in the process, 450 U.S. at 187, 209 USPQ at 8: include installing rubber in a press, closing the mold, constantly determining the temperature of the mold, constantly recalculating the appropriate cure time through the use of the formula and a digital computer, and automatically opening the press at the proper time. The statutory nature of the claim is not based on the post-solution activity of opening the press, but on the application of the mathematical algorithm to the whole process.
2. Parker v. Flook
The following claim in Flook was held to recite nonstatutory subject matter.
1. A method for updating the value of at least one alarm limit on at least one process variable involved in a process comprising the catalytic chemical conversion of hydrocarbons wherein said alarm limit has a current value of Bo + K wherein Bo is the current alarm base and K is a predetermined alarm offset which comprises:
(1) determining the present value of said process variable said
present value being defined as PVL:
(2) determining a new alarm base B1 using the following equation:
B1 = Bo(1.0 - F) + PVL(F)
where F is a predetermined number greater than zero and less than
1.0:
(3) determining an updated alarm limit which is defined as B1 + K:
and thereafter
(4) adjusting said alarm limit to said updated alarm limit value.
Step 1 The claim contains a mathematical algorithm comprising determining a new alarm base in step (2) and computing an "alarm limit" in step (3).
Step 2 When viewed without the steps of the mathematical algorithm, steps (2) and (3), the only limitations remaining are the preamble limitation restricting the field of use to "a process comprising the catalytic chemical conversion of hydrocarbons;" the data- gathering step of step (1); and the post-solution step of step (4). None of these limitations comprises an "otherwise statutory" process. The claim seeks to protect a method for computing an "alarm limit" rather than the application of the computation within an otherwise statutory process.
3. In re Abele
In Abele, claim 5 was held to recite nonstatutory subject matter under $ 101 whereas dependent claim 6 was statutory.
5. A method of displaying data in a field comprising the steps of calculating the difference between the local value of the data at a data point in the field and the average value of the data in a region of the field which surrounds said point for each point in said field, and displaying the value of said difference as a signed gray scale at a point in a picture which corresponds to said data point.
7. The method of claim 5 wherein said data is X-ray attenuation data produced in a two dimensional field by a computed tomography scanner. Step 1 Claim 5 contains a mathematical algorithm, "calculating the difference," which is defined in the specification as a Gaussian weighting function. Step 2 When claim 5 is viewed without the mathematical algorithm, the only remaining limitation is the post- solution activity of displaying the result. The display by itself did not constitute an "otherwise statutory" process. The court held that "the algorithm is neither explicitly nor implicitly applied to any certain process." 684 F.2d at 909, 214 USPQ at 688. However, when dependent claim 6 is added to the limitations of claim 5,
684 F.2d at 908, 214 USPQ at 687-88:
Were we to view the claim absent the algorithm, the production, detection and display steps would still be present and would result in a conventional CAT-scan process. . . . [W]e view the production, detection, and display steps as manifestly statutory subject matter and are not swayed from this conclusion by the presence of an algorithm in the claimed method.
III. Computer Programs
A. "Computer programs" versus "computer processes"
A "process" or " algorithm" is a step-by-step procedure to arrive at a given result. In the patent area, a "computer process" or "computer algorithm" is a process, i.e., a series of steps, which is performed by a computer. A "[computer] program is a sequence of coded instructions for a digital computer. Benson, 409 U.S. at 65. 175 USPQ at 674. Computer programs are equivalently known as "software." Unfortunately for discussion in this area, "[b]oth the series of steps performed by a computer, and the software directing those steps, have acquired the name "computer program."
Gelnovatch, 595 F.2d at 45 n.5, 201 USPQ at 148 n.5 (Markey, C.J., dissenting). What is sought to be protected by patent is the underlying process. As stated in Gelnovatch, 595 F.2d at 44, 201 USPQ at 147: Confusion may be avoided if it be realized that what is at issue is not the "program," i.e., the software, but the process steps which the software directs the computer to perform.
See, e.g., Maucorps, 609 F.2d at 483, 203 USPQ at 814 ("The [claimed] invention is implemented via a computer program written in FORTRAN IV, either built into the calculating machine, or loaded into a general purpose computer").
B. Statutory nature of computer processes
1. The Supreme Court has not ruled on the patentability of computer programs.
The Supreme Court has not ruled on whether computer process are per se statutory or nonstatutory. The decisions in Benson, Flook and Diehr all dealt with claims viewed as mathematical algorithms. In Benson and Diehr, the claims contained mathematical algorithms implemented by a computer.
In Benson, the Court held that the claims preempted the use of the mathematical algorithm, but did not hold that "any program servicing a computer" would be nonstatutory. In Diehr, the Court held that the claims otherwise defined a statutory process for curing rubber, and that the inclusion of a mathematical algorithm or computer program did not make claim nonstatutory. The claim in Flook did not involve a computer process.
In Dann v. Johnson, 425 U.S. 219, 189 USPQ 257 (1976), rev'g on other grounds, In re Johnson, 502 F.2d 765, 183 USPQ 172 (CCPA 1974), which involved a "machine system for automatic record-keeping of bank checks and deposits," the Court declined to discuss the $ 101 issue of the general patentability of computer programs, 425 U.S. at 220, 189 USPQ at 258:
We find no need to treat that question in this case, however, because we conclude that in any event respondent's system is unpatentable on grounds of obviousness. 35 U.S.C. $ 103.
In Diamond v. Bradley, an equally divided Supreme Court affirmed the CCPA's decision in Bradley. The claims were directed to computer "firmware," which refers to microinstructions permanently embodied in hardware elements, and not to a computer application or process. The CCPA found that the claims literally recited a machine and that, in applying the two-part test of Freeman, the claims did not recite a mathematical algorithm.
2. The CCPA has held that computer processes are statutory unless they fall within a judicially determined exemption. In Pardo, the most recent CCPA case on computer processes, the CCPA stated that, 684 F.2d at 916, 214 USPQ at 677: any process, machine, manufacture, or composition of matter constitutes statutory subject matter unless it falls within a judicially determined exception to section 101. The major (and perhaps only) exception in the area of computer processes is the mathematical algorithm. Although not binding precedent on the Federal Circuit, the district court in Paine, Webber, Jackson & Curtis, Inc. v. Merill, Lynch, Lynch, Pierce, Fenner &
Smith, 564 F.Supp. 1358, 1367, 218 USPQ 212, 218 (D. Del. 1983) stated:
The CCPA [has] . . . held that a computer algorithm, as opposed to a mathematical algorithm, is patentable subject matter.
If a computer process claim does not contain a mathematical algorithm in the Benson sense, the second step of the Freeman-Walter-Abele test is not reached, and the claimed subject matter will usually be statutory.
The traditional approach by the CCPA to the PTO's rejection of computer processes as nonstatutory subject matter has been to apply the two-part test for mathematical algorithms and to find statutory subject matter if the claims do not recite a mathematical algorithm. See Pardo, 684 F.2d at 916, 214 USPQ at 676 (process for converting source program into object program: "we are unable to find any mathematical formula, calculation, or algorithm either directly or indirectly recited in the claimed steps of examining, compiling, storing, and executing"); In re Toma, 575 F.2d 872, 877, 197 USPQ 852, 856 (CCPA 1978) (process for translating a source natural language, e.g., Russian, to a target natural language, e.g., English: "[we] are unable to find any direct or indirect recitation of a procedure for solving a mathematical problem"); In re Phillips, 608 F.2d 879, 883, 203 USPQ 971, 975 (CCPA 1979) (process for preparing architectural specifications: "Our analysis of the claims on appeal reveals no recitation, directly or indirectly, of an algorithm in the Benson and Flook sense"); Freeman, 573 F.2d at 1246, 197 USPQ at 471 ("The method
claims here at issue do not recite process steps which are themselves mathematical calculations, formulae, or equations"); Deutsch, 553 F.2d 689, 692, 193 USPQ 645, 648
(CCPA 1977) (method of operating a system of manufacturing plants: "Nothing in the methods claimed by Deutsch preempts a mathematical formula, an algorithm, or any specific computer program"); Chatfield, 545 F.2d at 158, 191 USPQ at 736 (method of reassigning priorities within a computer. "[the] independent claims contain neither a mathematical formula nor a mathematical algorithm" ).
If the computer process is found to contain a mathematical algorithm, it must then pass the second part of the Freeman- Walter-Abele test for statutory subject matter. See. e.g., Sherwood; Maucorps; Gelnovatch.
Arguably, other exceptions such as "methods of doing business" and "mental steps" may be raised if a claim is not a true computer process but merely recites that an otherwise nonstatutory process is performed on a computer. de Castelet, 562 F.2d at 1244, 195 USPQ at 447 ("Claims to nonstatutory processes do not automatically and invariable become patentable upon incorporation of reference to apparatus"). These would appear to be exceptions with very narrow application to claims which are not limited to implementation by a machine. For example, while a "method of doing business" per se is not statutory subject matter, "a method of operation on a computer to effectuate a business activity" has been held to be statutory subject
matter. Paine, Webber v. Merrill Lynch, 564 F.Supp. at 1369, 218 USPQ at 220. See also Deutsch, 553 F.2d at 692 n.5. 193 USPQ at 648 n.5 (claims were not a method of doing business because "[t]hey do not merely facilitate business dealings"); Johnston, rev'd on other grounds. Dann v. Johnston (apparatus claims directed to system for automatic record-keeping of bank checks and deposits did not cover a method of doing business). Similarly, machine or computer implementation of "mental steps" is statutory subject matter. Prater: In re Bernhart, 417 F.2d 1395, 163 USPQ 611 (CCPA 1969); In re Musgrave, 431 F.2d 882, 167 USPQ 280 (CCPA 1970). See also Toma (computer implemented method for translation of natural languages is statutory).
Chronological Order Case List
In re Prater, 415 F.2d 1393, 162 USPQ 541 (CCPA 1969)
In re Bernhart, 417 F.2d 1395, 163 USPQ 611 (CCPA 1969)
In re Musgrave, 431 F.2d 882, 167 USPQ 280 (CCPA 1970)
Gottschalk v. Benson, 409 U.S. 63, 175 USPQ 673 (1972)
In re Christensen, 478 F.2d 1392, 178 USPQ 35 (CCPA 1973)
Dann v. Johnston, 425 U.S. 219, 189 USPQ 257 (1976), rev'd on other grounds.
In re Johnston, 502 F.2d 765, 183 USPQ 172 (CCPA 1974)
In re Noll, 545 F.2d 141, 191 USPQ 721 (CCPA 1976), cert, denied, 434 U.S.
875, 195 USPQ 465 (1977)
In re Chattield, 545 F.2d 152, 191 USPQ 730 (CCPA 1976). cert. denied, 434
U.S. 875, 195 USPQ 465 (1977)
In re Deutsch, 553 F.2d 689, 193 USPQ 645 (CCPA 1977)
In re Waldbaum, 559 F.2d 611, 194 USPQ 465 (CCPA 1977)
In re Richman, 563 F.2d 1026, 195 USPQ 340 (CCPA 1977)
In re de Castelet, 562 F.2d 1236, 195 USPQ 439 (CCPA 1977)
In re Freeman, 573 F.2d 1237, 197 USPQ 464 (CCPA 1978)
In re Toma, 575 F.2d 872, 197 USPQ 852 (CCPA 1978)
Parker v. Flook, 437 U.S. 584, 198 USPQ 193 (1978)
In re Sarkar, 588 F.2d 1330, 200 USPQ 132 (CCPA 1978)
Hirschfeld v. Banner, 462 F.Supp. 135, 200 USPQ 276 (D.D.C. 198), aff'd
without opinion, 615 F.2d 1368 (D.C. Cir. 1980). cert. denied, 450 U.S.
994, 210 USPQ 776 (1981)
In re Gelnovatch, 595 F.2d 32, 201 USPQ 136 (CCPA 1979)
In re Maucorps, 609 F.2d 481, 203 USPQ 812 (CCPA 1979)
In re Phillips, 608 F.2d 879, 203 USPQ 971 (CCPA 1979)
In re Sherwood, 613 F.2d 809, 204 USPQ 537 (CCPA 1980). cert. denied, 450
U.S. 994, 210 USPQ 776 (1981)
In re Walter, 618 F.2d 758, 205 USPQ 397 (CCPA 1980)
Arshal v. United States, 621 F.2d 421, 208 USPQ 397 (Ct. Cl.
1980), cert. denied, 449 U.S. 1088 (1981). reh'g denied, 450
U.S. 1050 (1981)
Diamond v. Diehr, 450 U.S. 175, 209 USPQ 1 (1981)
Diamond v. Bradley, 45 U.S. 381, 209 USPQ 97 (1981). aff'g
by an equals divided Court. In re Bradley, 600 F.2d 807, 202
USPQ 480 (CCPA 1979)
In re Pardo, 684 F.2d 912, 214 USPQ 673 (CCPA 1982)
In re Taner, 681 F.2d 787, 214 USPQ 678 (CCPA 1982)
In re Abele, 684 F.2d 902, 214 USPQ 682 (CCPA 1982)
In re Meyer, 688 F.2d 789, 215 USPQ 193 (CCPA 1982)
Paine, Webber, Jackson & Curtis, Inc. v. Merrill Lynch,
Pierce, Fenner & Smith, 564 F.Supp. 1358, 218 USPQ 212 (D. Del. 1983)
Safe Flight Instrument Corp. v. Sundstrand Data Control Inc., 706 F.Supp.
1146, 10 USPQ2d 1733 (D. Del. 1989)
15 February 2007
In re Iwahashi, 1989
This case marked quite a change from earlier positions. In this case, the Federal Circuit held that a general purpose computer, running an new algorithm for pattern recognition, could be patentable subject matter.
Iwahashi's invention related to an auto-correlation unit for use in a pattern recognition to obtain auto-correlation coefficients as for stored signal samples. One particular embodiment related to using pattern recognition in voice recognition.
The claim on appeal was:
[a] An auto-correlation unit for providing auto-correlation coefficients for use as feature parameters in pattern recognition for N pieces of sampled input values Xn(n = 0 to N - 1), said unit comprising:
[b] means for extracting N pieces of sample input values Xn from a series of sample values in an input pattern expressed with an accuracy of optional multi-bits;
[c] means for calculating the sum of the sample values Xn and Xn-r (t = 0 - P, P ≤ N);
[d] a read-only memory associated with said means for calculating;
[e] means for feeding to said read-only memory the sum of the sampled input values as an address signal;
[f] means for storing in said read-only memory the squared value of each sum, (Xn + Xn-r )2;
[g] means for fetching and outputting the squared values of each sum of the sample input values from said read-only memory when said memory is addressed by the sum of the sample input values; and
[h] means responsive to the output (Xn + Xn-r)2 of said read-only memory for providing an auto-correlation coefficient for use as a feature parameter according to ...[a certain formula].
The Court stated that this case was one more in the line of cases stemming from the Supreme Court decision in Gottschalk v. Benson, decided by the Federal Circuit's predecessor, the CCPA. Out of these cases came the Freeman-Walter test to determine whether a claim defines nonstatutory subject matter. It was stated in Freeman as follows:
Determination of whether a claim preempts nonstatutory subject matter as a whole, in the light of Benson, requires a two-step analysis. First, it must be determined whether the claim directly or indirectly recites an "algorithm" in the Benson sense of that term, for a claim which fails even to recite an algorithm clearly cannot wholly preempt an algorithm. Second, the claim must be further analyzed to ascertain whether in its entirety it wholly preempts that algorithm.
The opinion next discussed the meaning of "algorithm":
Over-concentration on the word "algorithm" alone, for example, may mislead. The Supreme Court carefully supplied a definition of the particular algorithm before it [in Benson], i.e., "[a] procedure for solving a given type of mathematical problem." The broader definition of algorithm is "a step-by-step procedure for solving a problem or accomplishing some end."
The Federal Circuit stated that the claim as a whole certainly defined apparatus in the form of a combination of interrelated means and the Court could not discern any logical reason why it should not be deemed statutory subject matter as either a machine or a manufacture as specified in § 101. The fact that the apparatus operates according to an algorithm does not make it nonstatutory. The Court referred to Abele, and also to the discussion of that case in Grams. We Court therefore held that the claim was directed to statutory subject matter.
The Federal Circuit noted that the Solicitor's brief the summary of argument stated that the claim "encompasses any and every means for performing the functions recited therein." The Federal Circuit pointed out that the claim is a combination of means all but one of which is a means-plus-function limitation, the one exception being the ROM, clause [d], which is a specific piece of apparatus. The claim is therefore subject to the limitation stated in 35 U.S.C. § 112 ¶ 6 that each means-plus-function definition "shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof." This provision precludes the Solicitor's interpretation of the claim. The Solicitor's summary also contends that since the claim should be interpreted as he does, the Court should regard it as though it were a method claim.
The Court then stated that since the Solicitor was wrong on the first score, he was wrong on the second.
The Federal Circuit, in its decision In re Iwahashi, effectively opened up the doors of the patent system to algorithms, particularly if some hardware, such as a ROM, was recited.
In response to this case, the U.S. Patent and Trademark Office issued their own interpretation of this case in 1122 O.G. 445. They were not very happy with this case and still tended to reject applications that contained algorithms. Us patent attorneys would go out of our way to avoid using words such as "algorithm" anywhere in an application. Some of us older patent attorneys still tend to cross out the word algorithm when we see it in draft patent applications.
Iwahashi's invention related to an auto-correlation unit for use in a pattern recognition to obtain auto-correlation coefficients as for stored signal samples. One particular embodiment related to using pattern recognition in voice recognition.
The claim on appeal was:
[a] An auto-correlation unit for providing auto-correlation coefficients for use as feature parameters in pattern recognition for N pieces of sampled input values Xn(n = 0 to N - 1), said unit comprising:
[b] means for extracting N pieces of sample input values Xn from a series of sample values in an input pattern expressed with an accuracy of optional multi-bits;
[c] means for calculating the sum of the sample values Xn and Xn-r (t = 0 - P, P ≤ N);
[d] a read-only memory associated with said means for calculating;
[e] means for feeding to said read-only memory the sum of the sampled input values as an address signal;
[f] means for storing in said read-only memory the squared value of each sum, (Xn + Xn-r )2;
[g] means for fetching and outputting the squared values of each sum of the sample input values from said read-only memory when said memory is addressed by the sum of the sample input values; and
[h] means responsive to the output (Xn + Xn-r)2 of said read-only memory for providing an auto-correlation coefficient for use as a feature parameter according to ...[a certain formula].
The Court stated that this case was one more in the line of cases stemming from the Supreme Court decision in Gottschalk v. Benson, decided by the Federal Circuit's predecessor, the CCPA. Out of these cases came the Freeman-Walter test to determine whether a claim defines nonstatutory subject matter. It was stated in Freeman as follows:
Determination of whether a claim preempts nonstatutory subject matter as a whole, in the light of Benson, requires a two-step analysis. First, it must be determined whether the claim directly or indirectly recites an "algorithm" in the Benson sense of that term, for a claim which fails even to recite an algorithm clearly cannot wholly preempt an algorithm. Second, the claim must be further analyzed to ascertain whether in its entirety it wholly preempts that algorithm.
The opinion next discussed the meaning of "algorithm":
Over-concentration on the word "algorithm" alone, for example, may mislead. The Supreme Court carefully supplied a definition of the particular algorithm before it [in Benson], i.e., "[a] procedure for solving a given type of mathematical problem." The broader definition of algorithm is "a step-by-step procedure for solving a problem or accomplishing some end."
The Federal Circuit stated that the claim as a whole certainly defined apparatus in the form of a combination of interrelated means and the Court could not discern any logical reason why it should not be deemed statutory subject matter as either a machine or a manufacture as specified in § 101. The fact that the apparatus operates according to an algorithm does not make it nonstatutory. The Court referred to Abele, and also to the discussion of that case in Grams. We Court therefore held that the claim was directed to statutory subject matter.
The Federal Circuit noted that the Solicitor's brief the summary of argument stated that the claim "encompasses any and every means for performing the functions recited therein." The Federal Circuit pointed out that the claim is a combination of means all but one of which is a means-plus-function limitation, the one exception being the ROM, clause [d], which is a specific piece of apparatus. The claim is therefore subject to the limitation stated in 35 U.S.C. § 112 ¶ 6 that each means-plus-function definition "shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof." This provision precludes the Solicitor's interpretation of the claim. The Solicitor's summary also contends that since the claim should be interpreted as he does, the Court should regard it as though it were a method claim.
The Court then stated that since the Solicitor was wrong on the first score, he was wrong on the second.
The Federal Circuit, in its decision In re Iwahashi, effectively opened up the doors of the patent system to algorithms, particularly if some hardware, such as a ROM, was recited.
In response to this case, the U.S. Patent and Trademark Office issued their own interpretation of this case in 1122 O.G. 445. They were not very happy with this case and still tended to reject applications that contained algorithms. Us patent attorneys would go out of our way to avoid using words such as "algorithm" anywhere in an application. Some of us older patent attorneys still tend to cross out the word algorithm when we see it in draft patent applications.
In re Grams, 1989
The invention in this case related to a method of testing a complex system to determine whether the system condition is normal or abnormal and, if it is abnormal, to determine the cause of the abnormality. As disclosed in the specification, the invention is applicable to any complex system, whether it be electrical, mechanical, chemical, biological, or combinations thereof.
The Federal Circuit stated that, intuitively, one might conclude that § 101's "any...process" would include the diagnostic method claimed by the applicants. Indeed, even without physical step present in the claims, application of the algorithm in other steps of the claim seemed to be a type of "process" that the Supreme Court recognized as much in Flook.
The Federal Circuit stated that Flook made clear, however, as did its forerunner, Benson, that even though the application of an algorithm to data is a "process" in the literal sense, it is not one that is contemplated by § 101, i.e., it is "nonstatutory subject matter." Thus, mathematical algorithms join the list of non-patentable subject matter not within the scope of § 101, including methods of doing business, naturally occurring phenomenon [sic], and laws of nature. Construing § 101 as excluding mathematical algorithms seems somewhat at odds with the liberal view of that section expressed in a more recent Supreme Court opinion, Diamond v. Chakrabarty. There, the Court decided that a living man-made microorganism fell within the terms manufacture" or "composition of matter" in § 101. In choosing such "expansive terms," stated the Court, "modified by the comprehensive word 'any,' Congress plainly contemplated that the patent laws would be given wide scope." The Court went so far as to note that Congress intended statutory subject matter to include "anything under the sun that is made by man."
Chakrabarty expressly rejects the argument that patentability in a new area, "microorganisms, cannot qualify as patentable subject matter until Congress expressly authorizes such protection." Although the Court distinguished Flook in its opinion, the court's rejection of this argument seems to reflect a change from Flook's admonition that "we must proceed cautiously when we are asked to extend patent rights into areas wholly unforeseen by Congress."
The Federal Circuit noted that another case, Diehr, repeats the "anything under the sun" statement of Chakrabarty but then went on to say that notwithstanding those statements in Diehr and Chakrabarty, Benson remains the law. Indeed, it is cited in both Diehr and Chakrabarty, with no apparent attempt to overrule or disapprove of it. Thus, "an algorithm, or mathematical formula ... like a law of nature ... cannot be the subject of a patent."
The Federal Circuit stated that on the other hand, the mere presence of a mathematical exercise, as a step or steps in a process involving nonmathematical steps, should not slam the door of the PTO upon an applicant. Thus, if there are physical steps included in the claim in addition to the algorithm, the claim might be eligible for patent protection. As stated in In re Walter:
Once a mathematical algorithm has been found, the claim as a whole must be further analyzed. If it appears that the mathematical algorithm is implemented in a specific manner to define structural relationships between the physical elements of the claim (in apparatus claims) or to refine or limit claim steps (in process claims), the claim being otherwise statutory, the claim passes muster under § 101.
Though satisfaction of the Walter test necessarily depicts statutory subject matter, failure to meet that test does not necessarily doom the claim. As stated in Abele, "Walter should be read as requiring no more than that the algorithm be ‘applied in any manner to elements or process steps,'" That statement is followed by this proviso: "provided that its application is circumscribed by more than a field of use limitation or non-essential post-solution activity." Thus, if the claim would be "otherwise statutory," albeit inoperative or less useful without the algorithm, the claim likewise presents statutory subject matter when the algorithm is included.
In all instances, this critical question must be answered: "What did applicants invent?" And in answering this inquiry:
Each invention must be evaluated as claimed: yet semantogenic considerations preclude a determination based solely on words appearing in the claims. In the final analysis under § 101, the claimed invention, as a whole must be evaluated for what it is. Hence, the analysis requires careful interpretation of each claim in light of its supporting disclosure.
The Court stated that, though that analysis can be difficult, it is facilitated somewhat if, as here, the only physical step involves merely gathering data for the algorithm. As stated in In re Christensen, 478 F.2d 1392, 1394 (CCPA 1973):
Given that the method of solving a mathematical equation may not be the subject of patent protection, it follows that the addition of the old and necessary antecedent steps of establishing values for the variables in the equation cannot convert the unpatentable method to patentable subject matter.
The reason for this was explained in In re Sarkar, 588 F.2d at 1335:
No mathematical equation can be used, as a practical matter, without establishing and substituting values for the variables expressed therein. Substitution of values dictated by the formula has thus been viewed as a form of mathematical step. If the steps of gathering and substituting values were alone sufficient, every mathematical equation, formula, or algorithm having any practical use would be per se subject to patenting as a "process" under § 101. Consideration of whether the substitution of specific values is enough to convert the disembodied ideas present in the formula into an embodiment of those ideas, or into an application of the formula, is foreclosed by the current state of the law.
Whether § 101 precludes patentability in every case where the physical step of obtaining data for the algorithm is the only other significant element in mathematical algorithm–containing claims is a question we need not answer. Analysis in that area depends on the claims as a whole and the circumstances of each case. Rather, we address only the claims and other circumstances involved here.
The sole physical process step in Grams' claim 1 is step [a], i.e., performing clinical tests on individuals to obtain data. The specification does not bulge with disclosure on those tests. To the contrary, it focuses on the algorithm itself, although it briefly refers to, without describing, the clinical tests that provide data. Thus, it states: "The [computer] program was written to analyze the results of up to eighteen clinical laboratory tests produced by a standard chemical analyzer that measures the levels of the chemical and biological components listed." The specification also states that "[t]he invention is applicable to any complex system, whether it be electrical, mechanical, chemical or biological, or combinations thereof." From the specification and the claim, it is clear to us that applicants are, in essence, claiming the mathematical algorithm, which they cannot do under Benson. The presence of a physical step in the claim to derive data for the algorithm will not render the claim statutory.
The Court then distinguished Abele. Allowed claim 6 in Abele required operation of an algorithm on X-ray attenuation data, with a subsequent display. The data were available for the algorithm only after the production and detection steps, i.e., after an X-ray beam was passed through an object using a CAT scanner, and detected upon exit. The court concluded that in the absence of the algorithm, "the production, detection, and display steps would still be present and would result in a conventional CAT-scan process." Thus, the production and detection steps were not viewed as mere antecedent steps to obtain values to solve the algorithm. In Abele, therefore, the algorithm served to improve the CAT-scan process. As such, the algorithm satisfied the Walter guideline of "refining a step in a process that is otherwise statutory," and hence, it presented statutory subject matter. In this case, because algorithm steps [b]-[e] do not operate to change any aspect of the physical process of step [a], the claim does not satisfy the Walter guideline. Though this by itself is not dispositive (see discussion of Walter, supra), patentability here is precluded by the fact that physical step [a] merely provides data for the algorithm.
The Federal Circuit stated that, intuitively, one might conclude that § 101's "any...process" would include the diagnostic method claimed by the applicants. Indeed, even without physical step present in the claims, application of the algorithm in other steps of the claim seemed to be a type of "process" that the Supreme Court recognized as much in Flook.
The Federal Circuit stated that Flook made clear, however, as did its forerunner, Benson, that even though the application of an algorithm to data is a "process" in the literal sense, it is not one that is contemplated by § 101, i.e., it is "nonstatutory subject matter." Thus, mathematical algorithms join the list of non-patentable subject matter not within the scope of § 101, including methods of doing business, naturally occurring phenomenon [sic], and laws of nature. Construing § 101 as excluding mathematical algorithms seems somewhat at odds with the liberal view of that section expressed in a more recent Supreme Court opinion, Diamond v. Chakrabarty. There, the Court decided that a living man-made microorganism fell within the terms manufacture" or "composition of matter" in § 101. In choosing such "expansive terms," stated the Court, "modified by the comprehensive word 'any,' Congress plainly contemplated that the patent laws would be given wide scope." The Court went so far as to note that Congress intended statutory subject matter to include "anything under the sun that is made by man."
Chakrabarty expressly rejects the argument that patentability in a new area, "microorganisms, cannot qualify as patentable subject matter until Congress expressly authorizes such protection." Although the Court distinguished Flook in its opinion, the court's rejection of this argument seems to reflect a change from Flook's admonition that "we must proceed cautiously when we are asked to extend patent rights into areas wholly unforeseen by Congress."
The Federal Circuit noted that another case, Diehr, repeats the "anything under the sun" statement of Chakrabarty but then went on to say that notwithstanding those statements in Diehr and Chakrabarty, Benson remains the law. Indeed, it is cited in both Diehr and Chakrabarty, with no apparent attempt to overrule or disapprove of it. Thus, "an algorithm, or mathematical formula ... like a law of nature ... cannot be the subject of a patent."
The Federal Circuit stated that on the other hand, the mere presence of a mathematical exercise, as a step or steps in a process involving nonmathematical steps, should not slam the door of the PTO upon an applicant. Thus, if there are physical steps included in the claim in addition to the algorithm, the claim might be eligible for patent protection. As stated in In re Walter:
Once a mathematical algorithm has been found, the claim as a whole must be further analyzed. If it appears that the mathematical algorithm is implemented in a specific manner to define structural relationships between the physical elements of the claim (in apparatus claims) or to refine or limit claim steps (in process claims), the claim being otherwise statutory, the claim passes muster under § 101.
Though satisfaction of the Walter test necessarily depicts statutory subject matter, failure to meet that test does not necessarily doom the claim. As stated in Abele, "Walter should be read as requiring no more than that the algorithm be ‘applied in any manner to elements or process steps,'" That statement is followed by this proviso: "provided that its application is circumscribed by more than a field of use limitation or non-essential post-solution activity." Thus, if the claim would be "otherwise statutory," albeit inoperative or less useful without the algorithm, the claim likewise presents statutory subject matter when the algorithm is included.
In all instances, this critical question must be answered: "What did applicants invent?" And in answering this inquiry:
Each invention must be evaluated as claimed: yet semantogenic considerations preclude a determination based solely on words appearing in the claims. In the final analysis under § 101, the claimed invention, as a whole must be evaluated for what it is. Hence, the analysis requires careful interpretation of each claim in light of its supporting disclosure.
The Court stated that, though that analysis can be difficult, it is facilitated somewhat if, as here, the only physical step involves merely gathering data for the algorithm. As stated in In re Christensen, 478 F.2d 1392, 1394 (CCPA 1973):
Given that the method of solving a mathematical equation may not be the subject of patent protection, it follows that the addition of the old and necessary antecedent steps of establishing values for the variables in the equation cannot convert the unpatentable method to patentable subject matter.
The reason for this was explained in In re Sarkar, 588 F.2d at 1335:
No mathematical equation can be used, as a practical matter, without establishing and substituting values for the variables expressed therein. Substitution of values dictated by the formula has thus been viewed as a form of mathematical step. If the steps of gathering and substituting values were alone sufficient, every mathematical equation, formula, or algorithm having any practical use would be per se subject to patenting as a "process" under § 101. Consideration of whether the substitution of specific values is enough to convert the disembodied ideas present in the formula into an embodiment of those ideas, or into an application of the formula, is foreclosed by the current state of the law.
Whether § 101 precludes patentability in every case where the physical step of obtaining data for the algorithm is the only other significant element in mathematical algorithm–containing claims is a question we need not answer. Analysis in that area depends on the claims as a whole and the circumstances of each case. Rather, we address only the claims and other circumstances involved here.
The sole physical process step in Grams' claim 1 is step [a], i.e., performing clinical tests on individuals to obtain data. The specification does not bulge with disclosure on those tests. To the contrary, it focuses on the algorithm itself, although it briefly refers to, without describing, the clinical tests that provide data. Thus, it states: "The [computer] program was written to analyze the results of up to eighteen clinical laboratory tests produced by a standard chemical analyzer that measures the levels of the chemical and biological components listed." The specification also states that "[t]he invention is applicable to any complex system, whether it be electrical, mechanical, chemical or biological, or combinations thereof." From the specification and the claim, it is clear to us that applicants are, in essence, claiming the mathematical algorithm, which they cannot do under Benson. The presence of a physical step in the claim to derive data for the algorithm will not render the claim statutory.
The Court then distinguished Abele. Allowed claim 6 in Abele required operation of an algorithm on X-ray attenuation data, with a subsequent display. The data were available for the algorithm only after the production and detection steps, i.e., after an X-ray beam was passed through an object using a CAT scanner, and detected upon exit. The court concluded that in the absence of the algorithm, "the production, detection, and display steps would still be present and would result in a conventional CAT-scan process." Thus, the production and detection steps were not viewed as mere antecedent steps to obtain values to solve the algorithm. In Abele, therefore, the algorithm served to improve the CAT-scan process. As such, the algorithm satisfied the Walter guideline of "refining a step in a process that is otherwise statutory," and hence, it presented statutory subject matter. In this case, because algorithm steps [b]-[e] do not operate to change any aspect of the physical process of step [a], the claim does not satisfy the Walter guideline. Though this by itself is not dispositive (see discussion of Walter, supra), patentability here is precluded by the fact that physical step [a] merely provides data for the algorithm.
In re Meyer, 1982
Meyer's invention related to a system for aiding a neurologist in diagnosing patients. Meyer's claims were directed to a method of storing and correlating test responses on a complex system.
The CCPA upheld the Board of Patent Appeals and Interferences' affirmance of an Examiner's rejection of Meyer's claims as being unstatutory under 35 USC § 101.
The court applied the first part of the two-part Freeman-Walter test to the Meyer claims, relying on the applicants' specification and arguments, and found that the invention was concerned with partly replacing the thinking processes of a neurologist with a computer. The court then concluded that a mathematical algorithm was involved in the claims.
With respect to the second part of the Freeman-Walter test, the Court stated that Walter had modified Freeman to require an inquiry into whether the algorithm is implemented in a specific manner to define steps in process claims. The court stated that Walter was not intended to be an exclusive test, but that a more comprehensive test is to be found in Abele.
The Court state that the question should be whether the mental process is applied to physical elements or process steps in an otherwise statutory process, machine, manufacture, or composition of matter.
Applying this analysis to the Meyer claims, the Court found that the algorithm of the applicants' claims had not been applied to physical elements or process steps and were not to an otherwise statutory process or apparatus.
The CCPA upheld the Board of Patent Appeals and Interferences' affirmance of an Examiner's rejection of Meyer's claims as being unstatutory under 35 USC § 101.
The court applied the first part of the two-part Freeman-Walter test to the Meyer claims, relying on the applicants' specification and arguments, and found that the invention was concerned with partly replacing the thinking processes of a neurologist with a computer. The court then concluded that a mathematical algorithm was involved in the claims.
With respect to the second part of the Freeman-Walter test, the Court stated that Walter had modified Freeman to require an inquiry into whether the algorithm is implemented in a specific manner to define steps in process claims. The court stated that Walter was not intended to be an exclusive test, but that a more comprehensive test is to be found in Abele.
The Court state that the question should be whether the mental process is applied to physical elements or process steps in an otherwise statutory process, machine, manufacture, or composition of matter.
Applying this analysis to the Meyer claims, the Court found that the algorithm of the applicants' claims had not been applied to physical elements or process steps and were not to an otherwise statutory process or apparatus.
In re Pardo, 1982
In this case, the CCPA stated that any process, machine, manufacture, or composition of matter constitutes statutory subject matter unless it falls within a judicially determined exception to section 101.
This was an case in which the CCPA took the position that an invention can be statutory whether or not the novelty resides in the software.
This was an case in which the CCPA took the position that an invention can be statutory whether or not the novelty resides in the software.
In re Taner, 1982
Taner was decided after the Supreme Court's decision in Diamond.
Taner's claims were directed to a method of seismic exploration which simulated the response of subsurface earth formations to cylindrical or plane waves. An algorithm was directly recited in the claims.
In Taner, the CCPA distinguished between claims that are directed to "merely presenting and solving a mathematical algorithm," which are not statutory subject matter, and claims that are drawn "to a process of converting one physical thing into another physical thing," which are statutory subject matter.
The Court held that the claimed process involved taking one kind of "signal" and converting it into another kind of signal and that, thus, the claims set forth a process and were statutory within § 101.
Taner's claims were directed to a method of seismic exploration which simulated the response of subsurface earth formations to cylindrical or plane waves. An algorithm was directly recited in the claims.
In Taner, the CCPA distinguished between claims that are directed to "merely presenting and solving a mathematical algorithm," which are not statutory subject matter, and claims that are drawn "to a process of converting one physical thing into another physical thing," which are statutory subject matter.
The Court held that the claimed process involved taking one kind of "signal" and converting it into another kind of signal and that, thus, the claims set forth a process and were statutory within § 101.
Diamond v. Diehr and Lutton, 1981
By this time, the U.S. Patent and Trademark Office was still highly reluctant to allow patent applications covering to software based inventions. In the Diamond v. Diehr case, the Supreme Court forced the USPTO to grant a patent on an invention even though computer software was utilized. The USPTO had been fairly strictly refusing to allow applications for inventions reciting algorithms. In these years, an applicant's best shot at gaining an allowance was to disguise software as hardware; e.g., instead of reciting a comparison step, show a comparator in a block diagram for a digital machine.
This case related to a patent application for molding raw, uncured, synthetic rubber into cured precision products. The invention used measurement of actual temperature inside the mold during the curing process and used a computer calculate and control heating times. The patent examiner rejected the claims on the sole ground that they were drawn to nonstatutory subject matter under 35 U.S.C. §101 because steps in respondents’ claims that are carried out by a computer under control of a stored program constituted nonstatutory subject matter under the Supreme Court’s decision in Gottschalk v. Benson. The examiner also took the position that the remainder of the steps were already known in the industry. The Patent and Trademark Office Board of Appeals agreed with the examiner, but the Court of Customs and Patent Appeals reversed, noting that a claim drawn to subject matter otherwise statutory does not become nonstatutory because a computer is involved. The respondents claims were not directed to a mathematical algorithm or an improved method of calculation but rather recited an improved process for molding rubber articles by solving a practical problem which had arisen in the molding of rubber products. The Government sought certiorari arguing that the decision of the Court of Customs and Patent Appeals was inconsistent with prior decisions of the Supreme Court.
The invention, as defined by the claims, included not only the computer program, but also included steps relating to heating rubber, and removing the rubber from the heat. The Supreme Court found that the invention was not merely a mathematical algorithm, but was a process for molding rubber, and thus was patentable, even though the only novel feature was the timing process controlled by the computer.
More particularly, the Court stated that they viewed respondents’ claims as nothing more than a process for molding rubber products and not as an attempt to patent a mathematical formula. When a claim recites a mathematical formula (or scientific principle or phenomenon of nature), an inquiry must be made into whether the claim is seeking patent protection for that formula in the abstract. A mathematical formula as such is not accorded the protection of our patent laws, Gottschalk v. Benson, and this principle cannot be circumvented by attempting to limit the use of the formula to a particular technological environment. Parker v. Flook. Similarly, insignificant post-solution activity will not transform an unpatentable principle into a patentable process. To hold otherwise would allow a competent draftsman to evade the recognized limitations on the type of subject matter eligible for patent protection. On the other hand, when a claim containing a mathematical formula implements or applies that formula in a structure or process which, when considered as a whole, is performing a function which the patent laws were designed to protect (e.g., transforming or reducing an article to a different state or thing), then the claim satisfies the requirements of §101. Because the Court did not view the claims as an attempt to patent a mathematical formula, but rather to be drawn to an industrial process for the molding of rubber products, the Supreme Court affirmed the judgment of the Court of Customs and Patent Appeals.
The dissent stated that the claimed invention made no contribution to the art that was not entirely dependent upon the utilization of a computer in a familiar process, and they would have reversed the decision of the Court of Customs and Patent Appeals.
This case related to a patent application for molding raw, uncured, synthetic rubber into cured precision products. The invention used measurement of actual temperature inside the mold during the curing process and used a computer calculate and control heating times. The patent examiner rejected the claims on the sole ground that they were drawn to nonstatutory subject matter under 35 U.S.C. §101 because steps in respondents’ claims that are carried out by a computer under control of a stored program constituted nonstatutory subject matter under the Supreme Court’s decision in Gottschalk v. Benson. The examiner also took the position that the remainder of the steps were already known in the industry. The Patent and Trademark Office Board of Appeals agreed with the examiner, but the Court of Customs and Patent Appeals reversed, noting that a claim drawn to subject matter otherwise statutory does not become nonstatutory because a computer is involved. The respondents claims were not directed to a mathematical algorithm or an improved method of calculation but rather recited an improved process for molding rubber articles by solving a practical problem which had arisen in the molding of rubber products. The Government sought certiorari arguing that the decision of the Court of Customs and Patent Appeals was inconsistent with prior decisions of the Supreme Court.
The invention, as defined by the claims, included not only the computer program, but also included steps relating to heating rubber, and removing the rubber from the heat. The Supreme Court found that the invention was not merely a mathematical algorithm, but was a process for molding rubber, and thus was patentable, even though the only novel feature was the timing process controlled by the computer.
More particularly, the Court stated that they viewed respondents’ claims as nothing more than a process for molding rubber products and not as an attempt to patent a mathematical formula. When a claim recites a mathematical formula (or scientific principle or phenomenon of nature), an inquiry must be made into whether the claim is seeking patent protection for that formula in the abstract. A mathematical formula as such is not accorded the protection of our patent laws, Gottschalk v. Benson, and this principle cannot be circumvented by attempting to limit the use of the formula to a particular technological environment. Parker v. Flook. Similarly, insignificant post-solution activity will not transform an unpatentable principle into a patentable process. To hold otherwise would allow a competent draftsman to evade the recognized limitations on the type of subject matter eligible for patent protection. On the other hand, when a claim containing a mathematical formula implements or applies that formula in a structure or process which, when considered as a whole, is performing a function which the patent laws were designed to protect (e.g., transforming or reducing an article to a different state or thing), then the claim satisfies the requirements of §101. Because the Court did not view the claims as an attempt to patent a mathematical formula, but rather to be drawn to an industrial process for the molding of rubber products, the Supreme Court affirmed the judgment of the Court of Customs and Patent Appeals.
The dissent stated that the claimed invention made no contribution to the art that was not entirely dependent upon the utilization of a computer in a familiar process, and they would have reversed the decision of the Court of Customs and Patent Appeals.
14 February 2007
In re Abele and Marshall, 1982
This invention related to image processing particularly as applied to computerized axial tomography or CAT scans. Specifically, the invention was directed to an improvement in computed tomography whereby the exposure to X-ray is reduced while the reliability of the produced image is improved.
The Examiner at the U.S. Patent and Trademark Office rejected the claims on appeal under the authority of Parker v. Flook. The examiner construed Flook as mandating the following test:
Taking each claim as a whole, it is assumed, for analysis purposes only, that any mathematical calculation in the claim is part of the prior art. If what is left is new and unobvious, then the claim, taken as a whole, protects more than a mathematical calculation and it is deemed statutory. But if the remainder of the claim is not novel nor unobvious, then the claim, taken as a whole, merely seeks to protect the mathematical calculation and, as such, does not comprise statutory subject matter.
Applying the above test, the examiner determined that, apart from the mathematical calculations, the remaining steps were well known or were “merely a necessary antecedent step to provide values for solving the mathematical equations,” and, thus, were directed to nonstatutory subject matter.
The Board of Patent Appeals and Interferences did not address the examiner’s contentions, relying instead of In re Freeman, as modified by In re Walter. The board affirmed the rejection as follows:
When the claims are analyzed in [the manner dictated by Walter], it is manifest that the mathematical algorithm is not implemented in a manner to define structural relationships between physical elements in the apparatus claims or to refine or limit claim steps in the process claims. The claims do no more than present and solve a mathematical algorithm and are manifestly nonstatutory.
The United States Court of Customs and Patent Appeals noted that in the Walter case, the claims were directed to a process6 for correlating and cross-correlating signals. All of the claims steps were algorithm steps for performing the correlation or cross-correlation. There were no limitations in the claims, other than a field of use set forth in the preamble of the claims which stated that the algorithm was for use in connection with seismic surveying. The court concluded that the claims were directed to claiming only the algorithm, were not applied in any manner to any process steps, and were, therefore, directed to nonstatutory subject matter.
The court stated that Walter should be read as requiring no more than that the algorithm be “applied in any manner to physical elements or process steps,” provided that its application is circumscribed by more than a field of use limitation or non-essential post-solution activity. Thus, if the claim would be “otherwise statutory,” albeit inoperative or less useful without the algorithm, the claim likewise presents statutory subject matter when the algorithm is included. This broad reading of Walter is in accord with the Supreme Court decisions.
The court went on to say that the goal is to answer the question “What did applicants invent?” If the claimed invention is a mathematical algorithm, it is improper subject matter for patent protection, whereas if the claimed invention is an application of the algorithm, §101 will not bar the grant of a patent.
In answering that question, each invention must be evaluated as claimed; yet semantogenic considerations preclude a determination based solely on words appearing in the claims. In the final analysis under §101, the claimed invention, as a whole, must be evaluated for what it is.
Applying this test, the court noted that each of the independent claims and, necessarily, each of the dependent claims, included the limitation “calculating * * * the difference” either as a step in a process or as a means in an apparatus. Accordingly, all of the claims may be directed to nonstatutory subject matter as each presents a mathematical formula or a sequence of mathematical operations.
The court then turned to the second part of the analysis to determine whether what is claimed is a statutory process or apparatus or a nonstatutory algorithm.
The court contrasted the two broadest process claims, claims 5 and 6:
5. A method of displaying data in a field comprising the steps of
calculating the difference between the local value of the data at a data point in the field and the average value of the data in a region of the field which surrounds said point for each point in said field, and
displaying the value of said difference as a signed gray scale at a point in a picture which corresponds to said data point.
6. The method of claim 5 wherein said data is X-ray attenuation data produced in a two dimensional field by a computed tomography scanner.
The court concluded that claim 5 is directed solely to the mathematical algorithm portion of appellants’ invention and is, thus, not statutory subject matter under § 101. The court reached the opposite conclusion with respect to claim 6.
The method of claim 6, unlike that of claim 5, requires “X-ray attenuation data.” The specification indicates that such attenuation data is available only when an X-ray beam is produced by a CAT scanner, passed through an object, and detected upon its exit. Only after these steps have been completed is the algorithm performed, and the resultant modified data displayed in the required format.
Absent the algorithm, the production, detection and display steps would still be present and would result in a conventional CAT-scan process. Accordingly, production and detection cannot be considered mere antecedent steps to obtain values for solving the algorithm.
Other claims were analyzed in a similar manner.
The Examiner at the U.S. Patent and Trademark Office rejected the claims on appeal under the authority of Parker v. Flook. The examiner construed Flook as mandating the following test:
Taking each claim as a whole, it is assumed, for analysis purposes only, that any mathematical calculation in the claim is part of the prior art. If what is left is new and unobvious, then the claim, taken as a whole, protects more than a mathematical calculation and it is deemed statutory. But if the remainder of the claim is not novel nor unobvious, then the claim, taken as a whole, merely seeks to protect the mathematical calculation and, as such, does not comprise statutory subject matter.
Applying the above test, the examiner determined that, apart from the mathematical calculations, the remaining steps were well known or were “merely a necessary antecedent step to provide values for solving the mathematical equations,” and, thus, were directed to nonstatutory subject matter.
The Board of Patent Appeals and Interferences did not address the examiner’s contentions, relying instead of In re Freeman, as modified by In re Walter. The board affirmed the rejection as follows:
When the claims are analyzed in [the manner dictated by Walter], it is manifest that the mathematical algorithm is not implemented in a manner to define structural relationships between physical elements in the apparatus claims or to refine or limit claim steps in the process claims. The claims do no more than present and solve a mathematical algorithm and are manifestly nonstatutory.
The United States Court of Customs and Patent Appeals noted that in the Walter case, the claims were directed to a process6 for correlating and cross-correlating signals. All of the claims steps were algorithm steps for performing the correlation or cross-correlation. There were no limitations in the claims, other than a field of use set forth in the preamble of the claims which stated that the algorithm was for use in connection with seismic surveying. The court concluded that the claims were directed to claiming only the algorithm, were not applied in any manner to any process steps, and were, therefore, directed to nonstatutory subject matter.
The court stated that Walter should be read as requiring no more than that the algorithm be “applied in any manner to physical elements or process steps,” provided that its application is circumscribed by more than a field of use limitation or non-essential post-solution activity. Thus, if the claim would be “otherwise statutory,” albeit inoperative or less useful without the algorithm, the claim likewise presents statutory subject matter when the algorithm is included. This broad reading of Walter is in accord with the Supreme Court decisions.
The court went on to say that the goal is to answer the question “What did applicants invent?” If the claimed invention is a mathematical algorithm, it is improper subject matter for patent protection, whereas if the claimed invention is an application of the algorithm, §101 will not bar the grant of a patent.
In answering that question, each invention must be evaluated as claimed; yet semantogenic considerations preclude a determination based solely on words appearing in the claims. In the final analysis under §101, the claimed invention, as a whole, must be evaluated for what it is.
Applying this test, the court noted that each of the independent claims and, necessarily, each of the dependent claims, included the limitation “calculating * * * the difference” either as a step in a process or as a means in an apparatus. Accordingly, all of the claims may be directed to nonstatutory subject matter as each presents a mathematical formula or a sequence of mathematical operations.
The court then turned to the second part of the analysis to determine whether what is claimed is a statutory process or apparatus or a nonstatutory algorithm.
The court contrasted the two broadest process claims, claims 5 and 6:
5. A method of displaying data in a field comprising the steps of
calculating the difference between the local value of the data at a data point in the field and the average value of the data in a region of the field which surrounds said point for each point in said field, and
displaying the value of said difference as a signed gray scale at a point in a picture which corresponds to said data point.
6. The method of claim 5 wherein said data is X-ray attenuation data produced in a two dimensional field by a computed tomography scanner.
The court concluded that claim 5 is directed solely to the mathematical algorithm portion of appellants’ invention and is, thus, not statutory subject matter under § 101. The court reached the opposite conclusion with respect to claim 6.
The method of claim 6, unlike that of claim 5, requires “X-ray attenuation data.” The specification indicates that such attenuation data is available only when an X-ray beam is produced by a CAT scanner, passed through an object, and detected upon its exit. Only after these steps have been completed is the algorithm performed, and the resultant modified data displayed in the required format.
Absent the algorithm, the production, detection and display steps would still be present and would result in a conventional CAT-scan process. Accordingly, production and detection cannot be considered mere antecedent steps to obtain values for solving the algorithm.
Other claims were analyzed in a similar manner.
Diamond v. Chakrabarty, 1980
Diamond v. Chakrabarty is another Supreme Court case. A genetic engineer named Chakrabarty had developed a bacterium capable of breaking down crude oil, which he proposed to use in treating oil spills. He requested a patent for the bacterium in the United States but was turned down by a patent examiner, because the law dictated that living things were not patentable.
The court held that a live, human-made micro-organism is patentable subject matter under 35 U.S.C. 101. Chakrabarty's micro-organism constitutes a "manufacture" or "composition of matter" within that statute.
The court stated that in choosing such expansive terms as "manufacture" and "composition of matter," modified by the comprehensive "any," Congress contemplated that the patent laws should be given wide scope, and the relevant legislative history also supports a broad construction. While laws of nature, physical phenomena, and abstract ideas are not patentable, respondent's claim is not to a hitherto unknown natural phenomenon, but to a nonnaturally occurring manufacture or composition of matter, a product of human ingenuity "having a distinctive name, character and use."
The court took the position that passage of the 1930 Plant Patent Act, which afforded patent protection to certain asexually reproduced plants, and the 1970 Plant Variety Protection Act, which authorized protection for certain sexually reproduced plants but excluded bacteria from its protection, does not evidence congressional understanding that the terms "manufacture" or "composition of matter" in Section 101 do not include living things.
Nor does the fact that genetic technology was unforeseen when Congress enacted Section 101 require the conclusion that micro-organisms cannot qualify as patentable subject matter until Congress expressly authorizes such protection. The unambiguous language of Section 101 fairly embraces respondent's invention. Arguments against patentability under Section 101, based on potential hazards that may be generated by genetic research, should be addressed to the Congress and the Executive, not to the Judiciary.
This case is famous for taking the position that Congress had intended patentable subject matter to "include anything under the sun that is made by man"
The court held that a live, human-made micro-organism is patentable subject matter under 35 U.S.C. 101. Chakrabarty's micro-organism constitutes a "manufacture" or "composition of matter" within that statute.
The court stated that in choosing such expansive terms as "manufacture" and "composition of matter," modified by the comprehensive "any," Congress contemplated that the patent laws should be given wide scope, and the relevant legislative history also supports a broad construction. While laws of nature, physical phenomena, and abstract ideas are not patentable, respondent's claim is not to a hitherto unknown natural phenomenon, but to a nonnaturally occurring manufacture or composition of matter, a product of human ingenuity "having a distinctive name, character and use."
The court took the position that passage of the 1930 Plant Patent Act, which afforded patent protection to certain asexually reproduced plants, and the 1970 Plant Variety Protection Act, which authorized protection for certain sexually reproduced plants but excluded bacteria from its protection, does not evidence congressional understanding that the terms "manufacture" or "composition of matter" in Section 101 do not include living things.
Nor does the fact that genetic technology was unforeseen when Congress enacted Section 101 require the conclusion that micro-organisms cannot qualify as patentable subject matter until Congress expressly authorizes such protection. The unambiguous language of Section 101 fairly embraces respondent's invention. Arguments against patentability under Section 101, based on potential hazards that may be generated by genetic research, should be addressed to the Congress and the Executive, not to the Judiciary.
This case is famous for taking the position that Congress had intended patentable subject matter to "include anything under the sun that is made by man"
In re Walter, 1980
The invention in this case related to seismic prospecting and surveying. Seismic source waves are generated and transmitted downwardly into the earth. There they are deflected by subsurface formations and anomalies. The deflected waves return to the earth’s surface and are detected by transducers, known as geophones, which are distributed on the surface over the area of exploration. The geophones convert the returning mechanical vibrations into electrical signals, which are then recorded on a record medium, such as magnetic tape or chart recorder, for analysis. By studying the records of the deflected waves, analysts are able to make determinations concerning the nature of the subsurface structure of the earth.
In a final rejection, the examiner at the U.S. Patent and Trademark Office stated that the claims were directed to the mathematical procedure outlined in the specification for cross-correlating the sets of signals. He found no reason to distinguish between the method and apparatus claims, holding that distinction to be legally immaterial “Where the only mode of practicing an invention is disclosed by way of an algorithm for use in a computer program.”
The applicant’s main contention was that his claims were not directed to a mathematical procedure but to a method that produces a physical result (the partial product signals) by physical processing of physical signals, all of which are described in mathematical terms, and to apparatus for carrying out special forms of the process.
The U.S. Court of Customs and Patent Appeals stated that the common thread running through prior decisions regarding statutory subject matter is that a principle of nature or a scientific truth (including any mathematical algorithm which expresses such a principle or truth) is not the kind of discovery or invention which the patent laws were designed to protect.
The court also stated that various indicia are helpful in determining whether a claim as a whole calls merely for the solution of a mathematical algorithm. For instance, if the end-product of a claimed invention is a pure number, as in Benson and Flook, the invention is nonstatutory regardless of any post-solution activity which makes it available for use by a person or machine for other purposes. If, however, the claimed invention produces a physical thing, such as the noiseless seismic trace in In re Johnson, the fact that it is represented in numerical form does not render the claim nonstatutory.
With regard to "means for" claims, the court noted that both the examiner and the board of appeals and interferences refused to separately consider appellant’s apparatus claims because the method and apparatus claims were deemed indistinguishable. This problem arises in computer-arts inventions when the structure in apparatus claims is defined only as “means for” performing specified functions. If the functionally-defined disclosed means and their equivalents are so broad that they encompass any and every means for performing the recited functions, the apparatus claim is an attempt to exalt form over substance since the claim is really to the method or series of functions itself. In computer-related inventions, the recited means often perform the function of “number crunching” (solving mathematical algorithms and making calculations). In such cases the burden must be placed on the applicant to demonstrate that the claims are truly drawn to specific apparatus distinct from other apparatus capable of performing the identical functions. The court went on to say that if this burden has not been discharged, the apparatus claim will be treated as if it were drawn to the method or process which encompasses all of the claimed “means” and that the statutory nature of the claim under §101 will then depend on whether the corresponding method is statutory. In this case, the court held that all of appellant’s claims should be treated as method claims because the apparatus claims differ from the method claims only in that the term “means for” has been inserted before each process step to convert the step into the “means” for performing it, wherefore they do not have separate meaning as apparatus claims.
With regard to the method claims, the court stated that correlation or cross-correlation is a mathematical exercise which relates two mathematical functions. It remains a mathematical exercise even when verbally tied to the specific end use of seismic prospecting. Although the claim preambles relate the claimed invention to the art of seismic prospecting, the claims themselves are not drawn to methods of or apparatus for seismic prospecting; they are drawn to improved mathematical methods for interpreting the results of seismic prospecting.
In a final rejection, the examiner at the U.S. Patent and Trademark Office stated that the claims were directed to the mathematical procedure outlined in the specification for cross-correlating the sets of signals. He found no reason to distinguish between the method and apparatus claims, holding that distinction to be legally immaterial “Where the only mode of practicing an invention is disclosed by way of an algorithm for use in a computer program.”
The applicant’s main contention was that his claims were not directed to a mathematical procedure but to a method that produces a physical result (the partial product signals) by physical processing of physical signals, all of which are described in mathematical terms, and to apparatus for carrying out special forms of the process.
The U.S. Court of Customs and Patent Appeals stated that the common thread running through prior decisions regarding statutory subject matter is that a principle of nature or a scientific truth (including any mathematical algorithm which expresses such a principle or truth) is not the kind of discovery or invention which the patent laws were designed to protect.
The court also stated that various indicia are helpful in determining whether a claim as a whole calls merely for the solution of a mathematical algorithm. For instance, if the end-product of a claimed invention is a pure number, as in Benson and Flook, the invention is nonstatutory regardless of any post-solution activity which makes it available for use by a person or machine for other purposes. If, however, the claimed invention produces a physical thing, such as the noiseless seismic trace in In re Johnson, the fact that it is represented in numerical form does not render the claim nonstatutory.
With regard to "means for" claims, the court noted that both the examiner and the board of appeals and interferences refused to separately consider appellant’s apparatus claims because the method and apparatus claims were deemed indistinguishable. This problem arises in computer-arts inventions when the structure in apparatus claims is defined only as “means for” performing specified functions. If the functionally-defined disclosed means and their equivalents are so broad that they encompass any and every means for performing the recited functions, the apparatus claim is an attempt to exalt form over substance since the claim is really to the method or series of functions itself. In computer-related inventions, the recited means often perform the function of “number crunching” (solving mathematical algorithms and making calculations). In such cases the burden must be placed on the applicant to demonstrate that the claims are truly drawn to specific apparatus distinct from other apparatus capable of performing the identical functions. The court went on to say that if this burden has not been discharged, the apparatus claim will be treated as if it were drawn to the method or process which encompasses all of the claimed “means” and that the statutory nature of the claim under §101 will then depend on whether the corresponding method is statutory. In this case, the court held that all of appellant’s claims should be treated as method claims because the apparatus claims differ from the method claims only in that the term “means for” has been inserted before each process step to convert the step into the “means” for performing it, wherefore they do not have separate meaning as apparatus claims.
With regard to the method claims, the court stated that correlation or cross-correlation is a mathematical exercise which relates two mathematical functions. It remains a mathematical exercise even when verbally tied to the specific end use of seismic prospecting. Although the claim preambles relate the claimed invention to the art of seismic prospecting, the claims themselves are not drawn to methods of or apparatus for seismic prospecting; they are drawn to improved mathematical methods for interpreting the results of seismic prospecting.
The court stated that specific end use recited in the preambles does not save the claims from the holding in Flook, since they are drawn to methods of calculation, albeit improved. Examination of each claim demonstrates that each has no substance apart from the calculations involved. The calculations are the beginning and end of the claims. The court therefore held that this case falls squarely within the holding in Flook, and the claims must be held to be nonstatutory.
In re Freeman, 1978
The subject matter of Freeman’s invention was a system for typesetting alphanumeric information, using a computer-based control system in conjunction with a phototypesetter of conventional design. The claims included claims directed to methods of controlling a computer display system, as well as claims to a hierarchical “tree structure” computer storage arrangement. U.S. Patent and Trademark Office had rejected the patent application on the basis that the Benson case precluded patentability of an invention where the only novel part was the computer program.
The U.S. Court of Customs and Patent Appeals noted that with no reference to the nature of the algorithm involved, the U.S. Patent and Trademark Office’s Board of Appeals board merely stated that the coverage sought “in practical effect would be a patent on the algorithm itself.” Though the board gave no clear reasons for so concluding, its approach would appear to be that every implementation with a programmed computer equals “algorithm” in the Benson sense. If that rubric was the law, every claimed method that can be so implemented would equal nonstatutory subject matter under 35 USC 101.
The Court noted that a claim expressed in “means for” terms, though said to be an apparatus claim, may be indistinguishable from that of a method claim drawn to the steps performed by the “means.” The court agreed with the solicitor’s contention that if allowance of a method claim is proscribed by Benson, it would be anomalous to grant a claim to apparatus encompassing any and every “means for” practicing that very method.
The court held that because neither the apparatus claims nor the present method claims recite or preempt a mathematical algorithm as forbidden by Benson, both sets of claims are immune from a rejection based solely on the opinion in that case. The court then reversed the decision of the board rejecting claims 1-10 under 35 USC 101.
This case has been cited for laying out a two part test:
First, it must be determined whether the claim directly or indirectly recites an " algorithm" in the Benson sense of that term, for a claim which fails even to recite an algorithm clearly cannot wholly preempt an algorithm.
Second, the claim must be further analyzed to ascertain whether in its entirety it wholly preempts that algorithm.
The U.S. Court of Customs and Patent Appeals noted that with no reference to the nature of the algorithm involved, the U.S. Patent and Trademark Office’s Board of Appeals board merely stated that the coverage sought “in practical effect would be a patent on the algorithm itself.” Though the board gave no clear reasons for so concluding, its approach would appear to be that every implementation with a programmed computer equals “algorithm” in the Benson sense. If that rubric was the law, every claimed method that can be so implemented would equal nonstatutory subject matter under 35 USC 101.
The Court noted that a claim expressed in “means for” terms, though said to be an apparatus claim, may be indistinguishable from that of a method claim drawn to the steps performed by the “means.” The court agreed with the solicitor’s contention that if allowance of a method claim is proscribed by Benson, it would be anomalous to grant a claim to apparatus encompassing any and every “means for” practicing that very method.
The court held that because neither the apparatus claims nor the present method claims recite or preempt a mathematical algorithm as forbidden by Benson, both sets of claims are immune from a rejection based solely on the opinion in that case. The court then reversed the decision of the board rejecting claims 1-10 under 35 USC 101.
This case has been cited for laying out a two part test:
First, it must be determined whether the claim directly or indirectly recites an " algorithm" in the Benson sense of that term, for a claim which fails even to recite an algorithm clearly cannot wholly preempt an algorithm.
Second, the claim must be further analyzed to ascertain whether in its entirety it wholly preempts that algorithm.
Gottschalk v. Benson, 1972
In 1972, the U.S. Supreme Court reviewed a case involving patent application describing an invention as a method for converting binary-coded decimal numerals into pure binary numerals in a general purpose digital computer. The Court found that the invention was not patentable. The Supreme Court stated that this decision did not preclude ever finding a computer program patentable.
However, for years after this case came out, patent office examiners felt that no software was patentable, and they would routinely issue 101 rejections against patent applications that contained the word "algorithm." A direct quote from the Gottschalk v. Benson case follows:
It is argued that a process patent must either be tied to a particular machine or apparatus or must operate to change articles or materials to a "different state or thing." We do not hold that no process patent could ever qualify if it did not meet the requirements of our prior precedents. It is said that the decision precludes a patent for any program servicing a computer. We do not so hold. It is said that we have before us a program for a digital computer but extend our holding to programs for analog computers. We have, however, made clear from the start that we deal with a program only for digital computers. It is said we freeze process patents to old technologies, leaving no room for the revelations of the new, onrushing technology. Such is not our purpose. What we come down to in a nutshell is the following.
However, for years after this case came out, patent office examiners felt that no software was patentable, and they would routinely issue 101 rejections against patent applications that contained the word "algorithm." A direct quote from the Gottschalk v. Benson case follows:
It is argued that a process patent must either be tied to a particular machine or apparatus or must operate to change articles or materials to a "different state or thing." We do not hold that no process patent could ever qualify if it did not meet the requirements of our prior precedents. It is said that the decision precludes a patent for any program servicing a computer. We do not so hold. It is said that we have before us a program for a digital computer but extend our holding to programs for analog computers. We have, however, made clear from the start that we deal with a program only for digital computers. It is said we freeze process patents to old technologies, leaving no room for the revelations of the new, onrushing technology. Such is not our purpose. What we come down to in a nutshell is the following.
It is conceded that one may not patent an idea. But in practical effect that would be the result if the formula for converting BCD numerals to pure binary numerals were patented in this case. The mathematical formula involved here has no substantial practical application except in connection with a digital computer, which means that if the judgment below is affirmed, the patent would wholly pre-empt the mathematical formula and in practical effect would be a patent on the algorithm itself.
It may be that the patent laws should be extended to cover these programs, a policy matter to which we are not competent to speak. The President's Commission on the Patent System rejected the proposal that these programs be patentable:
- "Uncertainty now exists as to whether the statute permits a valid patent to be granted on programs. Direct attempts to patent programs have been rejected on the ground of nonstatutory subject matter. Indirect attempts to obtain patents and avoid the rejection, by drafting claims as a process, or a machine or components thereof programmed in a given manner, rather than as a program itself, have confused the issue further and should not be permitted.
- "The Patent Office now cannot examine applications for programs because of a lack of a classification technique and the requisite search files. Even if these were available, reliable searches would not be feasible or economic because of the tremendous volume of prior art being generated. Without this search, the patenting of programs would be tantamount to mere registration and the presumption of validity would be all but nonexistent.
- "It is noted that the creation of programs has undergone substantial and satisfactory growth in the absence of patent protection and that copyright protection for programs is presently available."
Subscribe to:
Posts (Atom)
