USPTO Updates Examination Guidelines for Patent Eligible Subject Matter

As noted in our recent update “Factual Questions May Preclude Early Resolution of Invalidity Under Section 101,” the Federal Circuit recently recognized that when determining whether a patent claim is directed to patent eligible subject matter, the “question of whether a claim element or combination of elements is well-understood, routine and conventional to a skilled artisan in the relevant field is a question of fact.”¹ In both Berkheimer and Aatrix², the Federal Circuit was exploring this issue in the context of litigation. The United States Patent and Trademark Office (“USPTO”) has now followed suit and issued a memo on April 19, 2018, to the Patent Examining Corps updating examination guidelines for Section 101 rejections based on the Berkheimer and Aatrix decisions (“Memo”).³ The Memo addresses the second step of the two-step inquiry established by the Supreme Court in Alice where (1) a determination is first made as to whether the claims at issue are directed to a patent ineligible concept and (2) if so, whether the additional elements transform the nature of the claim into a patent-eligible application.⁴

Although previous guidance to the Examining Corps recognized the Alice two-step inquiry⁵, the Memo now provides a more structured approach to Section 101 rejections with a recognition that the factual issues underlying the patent eligibility question must be addressed by examiners with particularity, and with an evidence-based approach. The new guidelines emphasize that “an examiner should conclude that an element (or combination of elements) represents well-understood, routine, conventional activity only when the examiner can readily conclude that the element(s) is widely prevalent or in common use in the relevant industry.”⁶ Significantly, the Memo further emphasizes that “[t]he question of whether additional elements represent well-understood, routine, conventional activity is distinct from patentability over the prior art under 35 U.S.C. §§ 102 and 103.”⁷ This important distinction is express recognition that “[t]he mere fact that something is disclosed in a piece of prior art…does not mean it was well-understood, routine and conventional.”⁸

According to the Memo, in formulating a rejection under Section 101, the new guidelines require that the “examiner finds, and expressly supports a rejection in writing with, one or more of [four criteria outlined in the Memo.] First, the examiner may support a Section 101 rejection with an express citation to the specification or to a statement in the file history by the applicant “that demonstrates the well-understood, routine, conventional nature of the additional element(s).”⁹ With this guidance, it is imperative that applicants use caution in both drafting the specification and presenting arguments in responses that could be construed as such an admission. Second, the examiner may rely on prior court decisions “noting the well-understood, routine, conventional nature of the additional elements.”¹⁰ Third, the examiner may cite to a publication that demonstrates that an element or combination of elements would be understood as conventional in the art. In this regard, it was again emphasized, however, that “a document may be a printed publication but still fail to establish that something it describes is well-understood, routine, and conventional activity.”¹¹ A passing reference in an obscure publication, for example, may not be sufficient to show that some element or combination of elements is indeed “well-understood, routine and conventional.” This point may provide fertile ground for applicants to argue against Section 101 rejections. Finally, the examiner may take “official notice of the well-understood, routine, conventional nature of the additional element(s).”¹² If, however, the applicant challenges this assertion, the burden shifts back to the examiner to provide evidence to document this assertion.

The new USPTO guidelines will require examiners to more thoroughly address Section 101 rejections and provide a clear evidentiary basis for the rejection. These guidelines should provide a clearer record for the public while also providing a sound basis for applicants to challenge a poorly supported rejection. Thus, both patent quality and acceptance rates for patent applications may be improved by these newly announced guidelines.

1. Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018).

2. Aatrix Software, Inc. v. Green Shades Software, Inc., 882 F.3d 1121 (Fed. Cir. 2018).

3. A copy of the Memo is available from the USPTO at https://www.uspto.gov/.

4. Alice Corp. v. CLS Bank Int’l, 573 U.S. ___, 134 S.Ct. 2347 (2012).

5. See e.g., May 4, 2016 memo, https://www.uspto.gov/sites/default/files/documents/ieg-may-2016-memo.pdf.

6. Memo at 3, emphasis in original.

7. Id.

8. Berkheimer, 881 F.3d at 1369.

9. Memo at 3.

10. Id.

11. Id. at 4.

12. Id.