Section 101 Rejection Overturned. What’s Next: A Notice of Allowance or a Revised Office Action?

It has seemed like the PTAB has been on a recent roll in reversing abstract idea rejections. In the past four weeks, 13 decisions have reversed abstract idea rejections. But in that same time period, there have been over 60 abstract idea appeals that have been affirmed. See Anticipat Research Database. So the recent trend has actually been consistent with historical reversal rates of about 20%, which is far below other grounds of rejection reversal rates.

On this note, two related business method applications came out on October 3, 2017: Ex Parte Webber et al., Appeal No. 2015-003647, and Ex Parte Webber et al., Appeal No. 2015-003796. In the decisions, the Board reversed the Examiner’s abstract idea rejections under 35 U.S.C. 101 for the same reasons. The Examiner had failed to set forth any analysis that the claim is directed to an abstract idea, and that the claims do not provide “significantly more” than any abstract idea. The Examiner in the Examiner’s Answer provided an incomplete analysis and only applied the machine-or-transformation test. And as the Bilski Supreme Court made clear, the machine-or-transformation is a useful tool, but not the sole test.

The Board only sought to decide the rejection at hand and not to evaluate the patent-eligibility of the claims on its own. Now that the decision was rendered, the logical question is what happens next? To understand this, we navigate through a somewhat complex area of rules.

The first scenario is for a “reversed” decision. When a decision is wholly reversed (each and every ground of rejection is reversed), the general outcome is a Notice of Allowance. There is an exception to this. The director can authorize reopening prosecution under 37 CFR 1.198 for the purpose of entering a new rejection. See MPEP 1002.02(c) and MPEP 1214.04. Thus, in Ex Parte Chapman, Appeal No. 2014-007861 (PTAB Nov. 21, 2016), all grounds of rejection (Sections 101 and 103 rejections) were reversed by the Board, but rather than issuing a Notice of Allowance, a subsequent Office Action issued with both rejections reappearing as new.

The second scenario is for an “affirmed” decision. If a Section 101 rejection is reversed, but other grounds of rejection were affirmed for all claims, this designates the decision as affirmed and the applicant must file an RCE to reopen prosecution. In response, the Examiner can issue an Office Action without a Section 101 rejection (especially when the Board reversed a well-articulated Section 101 rejection). See Ex Parte FISK, Appeal No. 2015-005360 (PTAB Sept. 21, 2016).

The Examiner can also issue an Office Action with a Section 101 rejection even though the Board reversed the previous 101 rejection (especially when the original 101 rejection was underdeveloped). in this manner, the Examiner can correct a deficiency in the analysis, as is often the case. See Ex Parte Dogin et al, Appeal No. 2015-005000 (PTAB Feb. 27, 2017) and Ex Parte Kelly et al, Appeal No. 2015-001219 (PTAB Dec. 19, 2016).

Returning back to these two decisions, it seems likely that the Examiner will likely issue another Office Action with an improved Section 101 rejection. In both of these decisions, while the Section 101 and Section 103 rejections were reversed, a Section 112 Written Description rejection was sustained. Thus, the applicant may choose to file amendments with the RCE, after which the Examiner may get a second opportunity to reject the claims as abstract using the proper analysis of Alice/Mayo. And with one of the applications having the title “SYSTEM AND METHOD FOR DONATING TO CHARITABLE ORGANIZATIONS”, it seems like it could be an uphill battle for the applicant.

2 responses

  1. Pingback: PatentlyO Bits and Bytes by Anthony McCain | Patently-O

  2. Pingback: Anticipat’s Top 10 Blog Posts of 2017 – Happy New Year’s! | Anticipat Blog

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