Senate/House Outline Follows USPTO’s Top-Down Approach

The USPTO released Revised Guidance on Patent Eligibility Under 35 U.S.C. § 101 back in January. The Guidelines simplified the case law by presenting a top-down approach to distill the morass of case law on abstract ideas into a list of exempted categories.

Under its new Guidleines, if a patented claim was not directed to an exempt category, the the claims passed muster. If the claim is directed to an enumerated category, a practical application analysis is then performed, and if satisfied, the claims still pass 101 scrutiny. The result is a more patent friendly, and manageable analysis….at least at the USPTO.

Since introduction of the Guidelines, however, the Courts have declined to show them deference. Yet, Congress appears poised to enact legislation to forcibly align the Courts with the agency 101 Guidelines.

Today, both Houses of Congress released identical draft outlines (here) for Section 101 Reform that essentially track the USPTO Guidlines.

The Draft Outline presents the following framework for future legislation:

• Keep existing statutory categories of process, machine, manufacture, or composition of matter, or any useful improvement thereof.

• Eliminate, within the eligibility requirement, that any invention or discovery be both “new and useful.” Instead, simply require that the invention meet existing statutory utility requirements.

• Define, in a closed list, exclusive categories of statutory subject matter which alone should not be eligible for patent protection. The sole list of exclusions might include the following categories, for example:

▪ Fundamental scientific principles;
▪ Products that exist solely and exclusively in nature;
▪ Pure mathematical formulas;
▪ Economic or commercial principles;
▪ Mental activities.

• Create a “practical application” test to ensure that the statutorily ineligible subject matter is construed narrowly.

• Ensure that simply reciting generic technical language or generic functional language does not salvage an otherwise ineligible claim.

• Statutorily abrogate judicially created exceptions to patent eligible subject matter in favor of exclusive statutory categories of ineligible subject matter.

• Make clear that eligibility is determined by considering each and every element of the claim as a whole and without regard to considerations properly addressed by 102, 103 and 112.

As can be appreicated,defining a closed list, just like the Guidelines, will go a long way to simplifying 101 analysis. Likewise, the practical application test also follows the lead of the agency. Other changes include the spearation of concerns about whether technology is “known or conventional, ” which the agency has done its best to filter out of its primary analysis.

While this proposal is likely music to the ears of those in medical diagnostics and Bio/Pharma fields, for Big Tech, the focus be on the specifics of the practical application test.

One thing is clear, Congress is has placed 101 Reform on the fast track and we can expect to see a draft bill emerging sooner rather than later.