Source: http://www.patents4software.com/category/section-101/
Timestamp: 2019-04-23 16:27:02+00:00

Document:
What, if anything, does Mayo v. Prometheus mean for Software Patents?
Recently, the Supreme Court decided Mayo Collaborative Services (“Mayo”) v. Prometheus Laboratories, Inc. (“Prometheus”). Although it does not involve software patents, the decision clarifies the proper place of the Machine-or-Transformation test in section 101 analysis, discusses abstract principles of nature, and rejects a recent suggestion by the Federal Circuit to invalidate a claim under Section 101 only after it first passes muster under Sections 102, 103 and 112.
At issue here are two patents—U. S. Patent No. 6,355,623 (’623 patent) and U. S. Patent No. 6,680,302(’302 patent)—which, cover “processes that help doctors who use thiopurine drugs to treat patients with autoimmune diseases determine whether a given dosage level is too low or too high.” Id. at 3. Mayo Collaborative Servs. v. Prometheus Labs., Inc., No. 10–1150, slip op. at 5 (Mar. 20, 2012). “The claims purport to apply natural laws describing the relationships between the concentration in the blood of certain thiopurine metabolites and the likelihood that the drug dosage will be ineffective or induce harmful side-effects.” Id. at 3.
’623 patent, col. 20, ll. 10–20, 2 App. 16.
Prometheus “is the sole and exclusive licensee of the ’623 and ’302 patents.” Id. at 6. “It sells diagnostic tests that embody the processes the patents describe.” Id. This dispute arose when Mayo stopped using the Prometheus test and “announced that it intended to begin using and selling its own test.” Id. The District Court found for Mayo, noting that although its test did infringe Prometheus’s patents, the patents were invalid as they claimed natural laws. Id. at 6–7. On Appeal, the Court of Appeals for the Federal Circuit reversed, noting that the invention met the machine-or-transformation test because the steps in the claims “involve the transformation of the human body or of blood taken from the body.” Id. at 7.
Upon review, the Supreme Court rejected the Federal Circuit’s analysis and held that the patents were invalid. Id. at 24. On the one hand, this decision can be read quite narrowly. The Court does say it is not persuaded that there is a relevant transformation here and, accordingly, the machine-or-transformation test fails. Id. at 19. There is, however, a lot more to this decision than a mere disagreement as to how the machine-or-transformation test applies to Prometheus’s claimed invention. The Court also says that “the ‘machine-or-transformation’ test is an ‘important and useful clue’ to patentability,” but it does not “trump the ‘law of nature’ exclusion.” The Court further explained, “all inventions at some level embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.” Id.at 2. The question then becomes “whether the claimed processes have transformed these unpatentable natural laws into patent eligible applications of those laws.” Id. at 3.
Ultimately, we are left with little guidance from the Court. It is quite clear that analysis under Section 101 is here to stay. It also clear that the machine-or-transformation is now a useful clue rather than a test. But a new test was not provided. Only time will tell how the courts, the USPTO, and practitioners apply this decision.
Machine-or-Transformation is not always enough.
With a bit of sleight of hand, the Court cites Bilski v. Kappos for the proposition that the machine-or-transformation test “is not a definitive test of patent eligibility, but only an important and useful clue.” Id. at 7. It is helpful to look back at Bilski to spot the sleight of hand. “This Court’s precedents establish that the machine-or-transformation test is a useful and important clue, an investigative tool, for determining whether some claimed inventions are processes under § 101. The machine-or-transformation test is not the sole test for deciding whether an invention is a patent-eligible ‘process.’” Bilski v. Kappos, 130 S. Ct. 3218, 3227 (2010). Bilski never said that the machine-or-transformation was insufficient to determine whether a process was patent-eligible. Instead, it said that there might also be other ways to identify a patent-eligible process. After Mayo, the machine-or-transformation test is not really a test at all. Rather, it is, as the Court says, a useful clue.
The transformation branch of the machine-or-transformation test now seems less than dispositive. This suggests that software patents should, when possible, include claims that tie the invention to a machine. Claims that are tied to a machine are often more difficult to draft broadly than a process claim, so include both. More importantly, claims directed to software inventions should be described, as much as possible, in terms of actual electronic circuits that are programmed to carry out a series of electronic operations. The more detail provided at the electronic circuit level, the better.
Applying an abstract principal of nature is not enough.
Section 101 is not going away.
The Court also weighed in on the ongoing debate in the Federal Circuit on the judicial morass of section 101, which we have discussed previously. In rejecting a proposal offered by the United States as Amicus Curiae, the Court said that relying on Sections 102, 103, and 112 in place of Section 101 would be inconsistent with prior case law. Id. at 20–22. Further, this approach would “creat[e] significantly greater legal uncertainty.” Id. at 21. The Court did acknowledge that there at times may be overlap between Section 101 analysis and the other sections of the patent act. Id. But it also noted that the other sections are unequipped to deal with laws of nature. Id. It seems that Section 101 analysis and uncertainty is here to stay.
1) All inventions begin as “ideas,” since, at least at the instance of conception, all inventions arise as a thought in the human mind.
2) Not all inventive ideas, however, despite existing only as thought, are considered “abstract”, so as to fall within the judicially created exceptions to Section 101 subject matter, for if all inventive ideas were considered “abstract”, all claimed inventions would require analysis to determine if they “wholly preempt” the abstract idea from which they were born. In other words, every invention would have an “abstract idea” component that could not be “wholly preempted.” Since this type of analysis, so far, has not been applied to all inventive ideas, we can deduce that only certain types of “abstract ideas” are considered objectionable under the judicially created exceptions to Section 101 subject matter.
3) Accordingly, the judicially-created exceptions to patent-eligibility under Section 101 implicitly sorts ideas into those that are “abstract” and those that are not.
4) Based on the exceptions explicitly enumerated by the Supreme Court to date, it is not clear if scientific principles, laws of nature and mathematical algorithms are not considered abstract ideas, but rather are excluded from Section 101 for separate reasons.
5) Precisely why financial and/or contract-based ideas are considered excluded “abstract ideas”, while other ideas, although existing only in the human mind, are somehow considered “not-abstract”, is unclear based on jurisprudence to date.
6) If we accept the proposition that some ideas are not considered abstract, and therefore do not have to be analyzed as a judicially-created exception to Section 101, and others are abstract, and therefore cannot “wholly preempt” the ideas, then we need one or more rules to logically seperate objectionable abstract ideas from non-objectionable ideas.
8) In the instant case, the court in CLS seems to acknowlege this test by finding that there were no technological innovations described in the CLS patents — that only routine, non-innovative application of technology was described for implementing the judicially excluded abstract ideas.
So, what’s the practicioner to do? I would say, for now, that if you are patenting inventions related to a financial or contractual idea, consider claiming first those aspects of the innovation that involve non-obvious implementations of the idea. You might also consider filing at least one application that avoids discussing the financial or contractual aspects of the innovation at all, instead treating the data representative of such financial or contractual aspects generically as “processed data.” If there is no point of novelty left after subtracting the financial or contractual limitations from the claims, then be forwarned that the claim may not pass muster under Section 101 if the logic used in CLS holds up on appeal.
The Specification of the Ex Parte Jack application discloses a method for “automatically measuring the volume of tissue in a region of interest by acquiring a magnetic resonance image, constructing a pixel intensity histogram of the image, and segmenting the histogram using a statistical regression analysis” (Spec. 5, qr 18). The “histogram is produced by counting the number of image pixels at each possible image intensity level and plotting the result as a frequency versus intensity graph” (id. at 5, qr 20).
(c) applying a statistical regression analysis to the histogram to determine a pixel intensity threshold value for segmenting the histogram into at least two regions, wherein at least one of the regions is representative of a tissue of interest.
(iii) applying the statistical parameter as an independent variable in a regression analysis to determine a threshold value to classify pixels based on pixel signal intensity.
What is interesting about this case and the RCT decision is that the method claims in question are not in any way tied to a computer implementation, although in both cases the claims involve imaging applications so are inherently limited to the interpretation or display of images that are certainly not “manifestly abstract.” If this line of reasoning holds up, patentees and practicioners may finally be relieved from having to follow formalistic claiming conventions invoking computer implementation of methods in order to avoid abstract idea objections under Section 101. These formalisms do little if anything to limit the substantive scope of claims but can complicate claim drafting so as to introduce unnecessary limitations that unfairly limit the patentee’s claim scope purely to meet formalistic and anachronistic Section 101 requirements.
In re Kelkar — Half Right for the Wrong Reason?
The inventions at issue (US Patent 7,346,545 — US07346545) are both expressly claimed as methods for distribution of products over the Internet and are clearly and unequivocably limited to use with the Internet, an Internet web site and interactive messages. Although the claim could be more explicit, it would also be reasonable to interpret many of the steps specified in the claims as Internet-implemented. Notwithstanding the express limitations tying the invention to an Internet implementation, the Court found that the claims were not “meaningfully” limited to machine implementation and, accordingly, did not pass muster under the machine prong of the machine or transformation test. The claims also failed the transformation test as well according to the Court.
I have been a patent attorney since 1981 and have always been interested in software as a hobby, as an investor, as an entreprenuer, and most predominantly as an intellectual property attorney who has helped countless software companies establish the intellectual property procedures and protections they needed in order to try to build a viable enterprise. Along the way, I have recommended many different strategies to my clients running the gamut from giving away their code, making their code open source but subject to license restrictions, keeping their source code trade secret and licensing only object code under a restrictive license, and including sometimes a recommendation to make patent protection a core protection strategy. The approach a company takes will depend greatly on the demands of the industry they seek to compete in and the amount of risk the company must take to establish an ongoing concern.
Unfortunately, I have seen many of these start-up software companies go under — many after years of a hard fight to get traction. Not a single one ever died because they were sued for patent infringement or even because there was a danger of patent infringement or being sued. No, the real problem facing software companies, contrary to notions promoted by certain anti-patent organizations, is not the risk of infringing a patent but rather the risk of not being able to find any customers who want to buy, or sometimes even use, their software. As Bob Dylan sings in the song Workingman Blues, “Sometimes no one wants what we got, Sometimes you can’t give it away.” As Bob knows from experience, the first thing an author worries about is just getting someone to want their stuff, and if that ain’t happening, they won’t be worried too much about getting sued for infringement. The reality is that most of new innovation just can’t find profitable traction in the marketplace — not even enough “profit” to keep one programmer going. In other words, its the lack of sales that kills innovative new products, not software patents.
Clearly this claim does not require any physical steps per se, or require the use of any “mechanisms”, as its core limitations constitute the abstract concepts of marketing, obtaining exclusive rights and sharing profits.

References: v. 
 v. 
 v. 
 v. 
 § 101
 v.