If Congress does not act on Section 101, has the PTAB hinted at a path forward?

A recent blog post by IPWatchdog recapped specific consensus views at the Patent Masters Symposium™ where Congress can help fix the messy state of patent-eligibility at the USPTO. Getting Congress involved seems like the best way to stabilize and make patent-eligibility more predictable. But if patent reform loses steam on Capitol Hill, it working with the current law is critical. Recent developments at the PTAB show most effective arguments (Step 2A or Step 1 of Alice/Mayo) to argue against patent-ineligibility. 

Last week, we published updated data of appeal outcomes for abstract idea rejections in April 2019. Now we delve into one of the more interesting trends for these reversals since the 2019 revised Subject Matter Guidance. This is the growing disparity of PTAB panels relying on step 2A (Step 1 of Alice/Mayo) versus step 2B (Step 2 of Alice/Mayo).  

step12

As can be seen from the graph below, starting in January, the number of decisions reversing abstract idea rejections increasingly rely on Step 2A compared with Step 2B. The past couple months of March and April has been particularly noticeable. March had 61 Step 2A such decisions compared with 15 Step 2B decisions. April was even more stark with 46 Step 2A reversals and only 4 Step 2B reversals. This is at least partially due to the courts constantly struggling to make sense of Alice and Mayo’s definition of “inventive concept”. It appears that for those decisions where the Board reverses, Step 2B (including the Berkheimer/Aatrix requiremen for evidentiary support for conventionality) has become a forgotten approach for many panels.

As the USPTO has struggled to reconcile the confusion about an inventive concept (Step 2B), the actual analysis of the step has recently veered into Step 2A. As most US patent practitioners are aware, the 2019 guidelines have split the Step 2A analysis for abstract ideas into two prongs. The first prong asks: do the claims recite one of three groupings of abstract ideas (mathematical relationships, mental processes, or methods of organizing human behavior). The second prong asks whether the claim is directed to a practical application of the judicial exception. Exemplary considerations are as follows:

  1. an additional element reflects an improvement in the functioning of a computer, or an improvement to other technology or technical field;
  2. an additional element that applies or uses a judicial exception to effect a particular treatment or prophylaxis for a disease or medical condition;
  3. an additional element implements a judicial exception with, or uses a judicial exception in conjunction with, a particular machine or manufacture that is integral to the claim;
  4. an additional element effects a transformation or reduction of a particular article to a different state or thing; and
  5. an additional element applies or uses the judicial exception in some other meaningful way beyond generally linking the use of the judicial exception to a particular technological environment, such that the claim as a whole is more than a drafting effort designed to monopolize the exception.

 Confusingly, above point 1 was explicitly analyzed in the Alice Supreme Court decision in Step 2 (Step 2B). This shows signs that the search for the inventive concept at the USPTO is now happening at Step 2A and Step 2B. This is not too surprising to those following subsequent Federal Circuit case law. But knowing the specific arguments that are successful, it can be helpful to press the right inventive concept buttons early in the argumentation.  

Before getting into how recent Board decisions overturn abstract idea rejections, some context is helpful. Indeed, much of the confusion about the inventive concept is historical. When the Supreme Court decided Parker v. Flook (an appealed Board decision by the way), a split Court found that the claim for adjusting alarm limits was a patent-ineligible abstract idea under Section 101. It states that what was needed was an inventive concept for patent-eligibility. The majority ignored arguments that other statutory provisions should address concerns the Court had over the patent application.

A few years later, a split Supreme Court in Diamond v. Diehr (another appealed Board decision) reversed course. The majority held that the rubber-curing claim was a practical application of a known mathematical equation and was therefore patent-eligible. In a footnote, the majority rebutted the dissent by saying that Section 101 is not the vehicle for inventiveness. It seemed like Diehr had overturned at least the inventiveness dicta of Flook.

Years later the Supreme Court in Mayo reversed course yet again. In invalidating a claim as directed to a law of nature, the Court introduced a two-step framework for determining patent-eligibility under Section 101. Step 2 of this framework was the inventive concept under Flook. A couple years later, Alice cemented the Mayo framework for computer-implemented claims.

How can this information be helpful in guiding your personal prosecution strategy? For one, this can help you identify winning strategies for overturning Examiners during open prosecution of an application. The Examiner or SPE will know about any of his/her recent reversals on a particular abstract idea rejection, and using argumentation that is consistent with this Board panel’s reversal can resonate with the Examiner or supervisor (especially if the decided claim has some similarities to your claim).

Consider a case where the Board recently overturned an abstract idea rejection Ex parte Dearing et al (PTAB June 27, 2019). If you are facing abstract rejections with Examiner Dante Ravetti, or in art unit 3685, or even have a business method application in general, it could be helpful to see the arguments used in both Step 2A and Step 2B in overturning this abstract idea rejection. Likewise, if you’re hitting headwind prosecute abstract idea rejections with Examiner John Chunyang Kuan, you could look at the argumentation in a recently decided decision Ex Parte Hunter et al. (PTAB June 27, 2019). This decision shows arguments for Step 2A that were sufficient to overturn the rejection in computer art unit 2857. 

The other way this data can be helpful relates to appeal strategy. If an Examiner or supervisor is unconvinced of your arguments, tailoring argumentation that has been used by PTAB judges overseeing similar technology or art units will more likely set you up for a favorable outcome on appeal. 

By using Anticipat Research, you can easily find those cases that have been reversed in your technology class, by your examiner, the art unit, or technology center. You can then model argumentation to your present case, if applicable. While you can find this information for any type of rejection (102, 103, 112, OTDP, etc.), Section 101 is a powerful breakdown because you can drill into the subissues of judicial exceptions and filter away the other Section 101 rejections not relevant to your rejection.  

research101

In times of flux, it is great to push for change and progress. But in the meantime, having the best patent prosecution data can dramatically improve your advocacy and ability to show patent-eligibility.  

 

 

 

Updated February ex parte decisions show Alice-based rejections getting overturned at a dizzying rate

For the past year, the PTAB has increasingly reversed so-called abstract idea rejections (Alice). But in recent months, the pace of these reversals has been nothing short of remarkable. Here, we report updated February numbers, which show the PTAB continuing to overturn abstract ideas at an unprecedented rate. We also look more deeply into how these rejections are getting overturned. It turns out the Board is increasingly relying on step 2A (Step 1 of Alice/Mayo) thanks to new guidance that makes it more difficult for an examiner’s rejection to hold.

As we recently reported on Patexia, the new examination guidance (effective early January) has fueled reversals at the Board. Now, with increased numbers for February 2019, this effect can now be seen much more dramatically.
reversalratefebup

In February, there were 61 completely reversed decisions from a total 149 such rejections. This yields an astonishing 41% reversal rate. This is of course astonishing by standards of Section 101 judicial exceptions. We have long reported that many grounds of rejection are overturned by the PTAB (such as Section 112 and Section 102) at even higher rates. But even just over a year ago, the PTAB routinely sided with examiners on abstract idea grounds upwards of 90% of the time. Now the climate is completely different.

Notable changes in reversal rates can be seen from the color-coded timeline events in the graph above. Red refers to when Berkheimer and similar Federal Circuit decisions were decided, which put a higher evidentiary standard on showing that claims did not recite an “inventive concept.” With a little lag, the reversal rate ticked up. Then in the fall of 2018, Director Andrei Iancu started more actively promoting better (more consistent) Section 101 examination, eventually resulting in new 101 Examination guidance shown by the yellow line. The PTAB appears to quickly adapt to case law, guidance and internal cultural changes.

And these results do not appear to be from a sample size distortion (because applicants have already given up). while the total number of abstract idea rejections decided did not reach months seen last year, this is likely due to the PTAB picking up the new year on a slow note, which is historically the case. In fact, February 2019 saw the Board decide more abstract idea rejections than February 2018. See below. And even with the total number of decisions deciding abstract idea grounds of rejections being lower than prior months, it still set a record in the total number of such reversals (61) breaking the previous record of December 2018 (58).

totalabstractreversalsfebup

How is the PTAB overturning these rejections? Thankfully, the Anticipat research database makes this question easy to answer, cataloging the specific rationale (tag) that is used in overcoming the rejections. As shown from the following graph, Step 1 (which the USPTO refers to as Step 2A) has now separated itself from Step 2.

abstractideastep2a

A good practitioner will tell you that thanks to the new Section 101 guidance and other case law developments, it is now easier to overcome Abstract Idea rejections. These Board decisions directly show this at the final stage, but results can also be felt farther upstream of these decisions. 

Like many USPTO personnel, PTAB judges are quota-motivated. Because of this, end of quarters typically have higher output of decisions. For this reason, expect March 2019 to be a big month in the volume of abstract idea rejections decided and in the total number of reversals. If history is any indication, we could be looking at another record month.