Another Turn in the Path to Patentability

First, we examine some pre-Mayo developments from Congress and the PTO. In the AIA, Congress declined to directly address the issue of patent-eligibility, but nonetheless there is some guidance that can be taken from what Congress did, and did not, do. Back in 1952, Congress amended ' 101 of the patent statute, which sets forth categories of patentable subject matter by replacing the word “art” with the word “process” and by defining that word to mean, “process, art or method.” 35 U.S.C.
' 100(b). The term “art” had been included in the original statute drafted by Thomas Jefferson and remained in place since 1793; the new term reflected modern usage of language but was not intended to be a substantive change in meaning. In 2011, Congress did not amend ' 101 at all, so it still provides that, “Whoever invents or discovers any new and useful process, machine, ' ” may be granted a patent. Notably, Congress declined, both in 1952 and in 2011, to replace the phrase “ invents or discovers” with anything more limited. The constitutional foundation for patent law grants to “Inventors the exclusive Right to their ' Discoveries ' .” Both before 1952 and after, courts have routinely imposed a requirement of “invention,” sometimes reasoned as inherent in the use of the term “Inventors” in the Constitution. Notably, though, Congress has kept the phrase “invents or discovers,” leaving one to ponder what sort of discovery that is not an invention might be patentable.

The only reference Congress made in the AIA to patentability was in connection with a new review procedure for already granted “covered business method patents.” Congress excluded from this provision any “technological inventions,” and left it as a rulemaking exercise for the PTO to define that term. Congress included in the AIA a disclaimer that this statutory section should not be “construed as amending or interpreting categories of patent-eligible subject matter set forth under section 101 ' .” (AIA, ' 18(e)). Notwithstanding the disclaimer, the new procedure would be meaningless if all inventions that were not “technological” were categorically not patentable subject matter.

The PTO, for its part, has not provided much clarity either. In its proposed rulemaking in early 2012 (before Mayo), the PTO suggested a definition of a “technological invention” that uses the word “technical” twice and “technological” once. Such a circular definition would not provide guidance to parties considering whether to submit a patent for review under the AIA. Further, the PTO has reacted to both Bilski and Mayo with written guidance that, to date, has largely just mirrored snippets from those holdings. Before Mayo, the PTO did guide its examiners not to focus on ' 101 issues if a claim could be rejected using other statutory provisions. This last bit of guidance from the PTO resulted from the post-Bilski Federal Circuit rift referenced above.

The Mayo Decision

Such was the state of affairs when the Mayo decision was released, holding that method claims for applying a law of nature using merely conventional steps are not eligible for patent protection. The Court stated that the machine-or-transformation test for patentability, which the Court endorsed as a useful, though not exclusive, test in Bilski, does not trump the prerequisite requirement that “laws of nature, natural phenomena and abstract ideas” cannot be patented.

The Court's ruling put to rest the rift within the Federal Circuit regarding how and when patent-eligibility should be considered by courts, but it also appears to have revived the previously discredited practice of dissecting a claim into its parts, in this instance to determine whether the claim does more than simply recite a law of nature and then set forth conventional steps for applying that law. In recent years, claim analysis had shifted away from such dissection to analysis of the claim as a whole, since many inventions result from innovative combinations of known elements.

At issue in Mayo was a method of determining whether a given dose of a particular drug is too high, resulting in toxicity, or too low, rendering it ineffective. The method at issue involves measuring the level of certain metabolites in a patient's blood.

The Court determined that the claimed method simply recited a law of nature and a series of steps that “involve well-understood, routine, conventional activity previously engaged in by researchers in the field.” The Court held that upholding such claims “would risk disproportionately tying up the use of the underlying natural laws, inhibiting their use in the making of further discoveries.”

The Court stated, without analysis, that the relationships between the metabolite concentrations and the likelihood that a drug dosage would be ineffective or cause harm were “laws of nature.” The Court found that the claims did not do significantly more than simply describe these natural (i.e., biological) relationships.

The reference to constituent process steps as conventional or non-conventional means that in determining whether an invention is drawn to subject matter that is statutory (i.e., patent-eligible), the PTO or a court must consider not only the subject matter itself but also the state of the art in that field. While some lower courts after Bilski had been determining subject matter eligibility with scant, if any, reference to the specific language of the claims, this decision calls on them to analyze not only the claim language itself but the prior art as well, even before determining whether that prior art makes the claim unpatentable due to lack of novelty or to obviousness.

In finding the claims unpatentable, the Court repeatedly used comparative and conclusory phrases such as “overly broad,” “improperly tying up the future use of laws of nature” and “forecloses more future invention than the underlying discovery could reasonably justify” (italics added). Indeed, the Court's opinion uses the word “simply” some 18 times, generally in characterizing how little the claim adds beyond a recitation of a law of nature. The Court aptly observes that, “Courts and judges are not institutionally well suited to making the kinds of judgments needed to distinguish among different laws of nature.” Undoubtedly, future commentators will wonder how such institutions can be expected to make the above comparisons and characterizations, given such limitations.

Regardless, the Court explicitly instructs in Mayo that such institutions must make these determinations as part of a subject-matter eligibility analysis, rather than by relying on the other sections of the patent law that may be easier to apply.

The Impact

For companies and researchers in the life sciences, the impact of this decision cannot be overestimated. For other industries as well, this decision has a clear impact. For instance, the question about whether patent-eligibility is merely a “coarse filter” that should be avoided when possible is now settled ' the patent eligibility analysis must be undertaken. The Court's approach of dissecting method claims to determine which portions state laws of nature and which portions recite conventional steps, if extended to include the other branches of the “implicit exception” to patentability that the Court references (i.e., natural phenomena and abstract ideas), implicate a wide swath of science and technology areas. Given that lower courts are currently struggling with how best to circumscribe all three of these judicially created exception areas, it will be a number of years before there is settled law that will provide guidance for the types of methods that remain patentable.

The continued viability of the machine-or-transformation test, itself only a few years old, is now in doubt, given that the Court has now held it neither necessary (Bilski) nor sufficient (Mayo) to determine that an invention is patent-eligible.

The Mayo decision further highlights a neglected area in the law regarding patentability ' the constitutional and statutory reference to discovery. The Court's opinion repeatedly references discoveries as examples of subject matter that is not eligible for patenting. The basis for such exclusion is expressly stated, at the first page of the Mayo opinion, to be a judicially created “implicit exception” rather than anything found in the Constitution or the patent statute. If the toxicity level of a particular drug is not a “discovery” in the classic sense of the term, than it will be very difficult to know what kinds of “discoveries” may be patentable.

Given that Congress has just concluded significant patent reform with the AIA, it is unlikely that Congress will address any concerns that may arise from Mayo in the near future. As a unanimous decision, it is unlikely that the Court itself will depart from the Mayo approach anytime soon. Thus, practitioners should get used to the instruction provided by Mayo and Bilski, as these cases are likely to provide the basis for ' 101 analysis for quite some time.

Stuart Meyer is a partner in the Intellectual Property Group of Fenwick & West LLP. His practice centers on patent, trade secret and copyright matters.

In the April issue of The Intellectual Property Strategist, we detailed a growing rift in the Federal Circuit regarding the issue of patentable subject matter, and pondered whether the Supreme Court would resolve this issue when it came out with its decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc., No. 10-1150. We did not have to wait long, as the decision was issued on March 20. The Supreme Court held that a method claim that does nothing more than restate a law of nature and add conventional steps cannot be patentable. At first glance, this may not sound remarkable, but upon closer inspection this holding has the potential to dramatically change patent law for decades to come.

In Bilski, the rejection of the claims at issue was unanimous, but the Court was deeply divided in its reasoning and came within a single vote of categorically eliminating business methods from the scope of patentable subject matter. Bilski v. Kappos , 561 U.S. __, 130 S. Ct. 3218 (2010). In Mayo, the Court spoke with one voice, with no Justice submitting a separate concurring opinion. As we head toward the middle of 2012, we have not only the Mayo and Bilski opinions on patentability, but also recently enacted patent reform hailed as the most significant in 50 years (the America Invents Act or AIA, signed into law in September 2011) as well as numerous guidelines and proposed rules set forth by the U.S. Patent and Trademark Office (“PTO”). Yet even with all three branches of government having spoken directly on the issue, we astonishingly still do not have clear guidance for how to determine whether a method claim is patent-eligible. How is that possible? We examine these developments in turn to find out.

Pre-Mayo Developments

First, we examine some pre-Mayo developments from Congress and the PTO. In the AIA, Congress declined to directly address the issue of patent-eligibility, but nonetheless there is some guidance that can be taken from what Congress did, and did not, do. Back in 1952, Congress amended ' 101 of the patent statute, which sets forth categories of patentable subject matter by replacing the word “art” with the word “process” and by defining that word to mean, “process, art or method.” 35 U.S.C.
' 100(b). The term “art” had been included in the original statute drafted by Thomas Jefferson and remained in place since 1793; the new term reflected modern usage of language but was not intended to be a substantive change in meaning. In 2011, Congress did not amend ' 101 at all, so it still provides that, “Whoever invents or discovers any new and useful process, machine, ' ” may be granted a patent. Notably, Congress declined, both in 1952 and in 2011, to replace the phrase “ invents or discovers” with anything more limited. The constitutional foundation for patent law grants to “Inventors the exclusive Right to their ' Discoveries ' .” Both before 1952 and after, courts have routinely imposed a requirement of “invention,” sometimes reasoned as inherent in the use of the term “Inventors” in the Constitution. Notably, though, Congress has kept the phrase “invents or discovers,” leaving one to ponder what sort of discovery that is not an invention might be patentable.

The only reference Congress made in the AIA to patentability was in connection with a new review procedure for already granted “covered business method patents.” Congress excluded from this provision any “technological inventions,” and left it as a rulemaking exercise for the PTO to define that term. Congress included in the AIA a disclaimer that this statutory section should not be “construed as amending or interpreting categories of patent-eligible subject matter set forth under section 101 ' .” (AIA, ' 18(e)). Notwithstanding the disclaimer, the new procedure would be meaningless if all inventions that were not “technological” were categorically not patentable subject matter.

The PTO, for its part, has not provided much clarity either. In its proposed rulemaking in early 2012 (before Mayo), the PTO suggested a definition of a “technological invention” that uses the word “technical” twice and “technological” once. Such a circular definition would not provide guidance to parties considering whether to submit a patent for review under the AIA. Further, the PTO has reacted to both Bilski and Mayo with written guidance that, to date, has largely just mirrored snippets from those holdings. Before Mayo, the PTO did guide its examiners not to focus on ' 101 issues if a claim could be rejected using other statutory provisions. This last bit of guidance from the PTO resulted from the post-Bilski Federal Circuit rift referenced above.

The Mayo Decision

Such was the state of affairs when the Mayo decision was released, holding that method claims for applying a law of nature using merely conventional steps are not eligible for patent protection. The Court stated that the machine-or-transformation test for patentability, which the Court endorsed as a useful, though not exclusive, test in Bilski, does not trump the prerequisite requirement that “laws of nature, natural phenomena and abstract ideas” cannot be patented.

The Court's ruling put to rest the rift within the Federal Circuit regarding how and when patent-eligibility should be considered by courts, but it also appears to have revived the previously discredited practice of dissecting a claim into its parts, in this instance to determine whether the claim does more than simply recite a law of nature and then set forth conventional steps for applying that law. In recent years, claim analysis had shifted away from such dissection to analysis of the claim as a whole, since many inventions result from innovative combinations of known elements.

At issue in Mayo was a method of determining whether a given dose of a particular drug is too high, resulting in toxicity, or too low, rendering it ineffective. The method at issue involves measuring the level of certain metabolites in a patient's blood.

The Court determined that the claimed method simply recited a law of nature and a series of steps that “involve well-understood, routine, conventional activity previously engaged in by researchers in the field.” The Court held that upholding such claims “would risk disproportionately tying up the use of the underlying natural laws, inhibiting their use in the making of further discoveries.”

The Court stated, without analysis, that the relationships between the metabolite concentrations and the likelihood that a drug dosage would be ineffective or cause harm were “laws of nature.” The Court found that the claims did not do significantly more than simply describe these natural (i.e., biological) relationships.

The reference to constituent process steps as conventional or non-conventional means that in determining whether an invention is drawn to subject matter that is statutory (i.e., patent-eligible), the PTO or a court must consider not only the subject matter itself but also the state of the art in that field. While some lower courts after Bilski had been determining subject matter eligibility with scant, if any, reference to the specific language of the claims, this decision calls on them to analyze not only the claim language itself but the prior art as well, even before determining whether that prior art makes the claim unpatentable due to lack of novelty or to obviousness.

In finding the claims unpatentable, the Court repeatedly used comparative and conclusory phrases such as “overly broad,” “improperly tying up the future use of laws of nature” and “forecloses more future invention than the underlying discovery could reasonably justify” (italics added). Indeed, the Court's opinion uses the word “simply” some 18 times, generally in characterizing how little the claim adds beyond a recitation of a law of nature. The Court aptly observes that, “Courts and judges are not institutionally well suited to making the kinds of judgments needed to distinguish among different laws of nature.” Undoubtedly, future commentators will wonder how such institutions can be expected to make the above comparisons and characterizations, given such limitations.

Regardless, the Court explicitly instructs in Mayo that such institutions must make these determinations as part of a subject-matter eligibility analysis, rather than by relying on the other sections of the patent law that may be easier to apply.

The Impact

For companies and researchers in the life sciences, the impact of this decision cannot be overestimated. For other industries as well, this decision has a clear impact. For instance, the question about whether patent-eligibility is merely a “coarse filter” that should be avoided when possible is now settled ' the patent eligibility analysis must be undertaken. The Court's approach of dissecting method claims to determine which portions state laws of nature and which portions recite conventional steps, if extended to include the other branches of the “implicit exception” to patentability that the Court references (i.e., natural phenomena and abstract ideas), implicate a wide swath of science and technology areas. Given that lower courts are currently struggling with how best to circumscribe all three of these judicially created exception areas, it will be a number of years before there is settled law that will provide guidance for the types of methods that remain patentable.

The continued viability of the machine-or-transformation test, itself only a few years old, is now in doubt, given that the Court has now held it neither necessary (Bilski) nor sufficient (Mayo) to determine that an invention is patent-eligible.

The Mayo decision further highlights a neglected area in the law regarding patentability ' the constitutional and statutory reference to discovery. The Court's opinion repeatedly references discoveries as examples of subject matter that is not eligible for patenting. The basis for such exclusion is expressly stated, at the first page of the Mayo opinion, to be a judicially created “implicit exception” rather than anything found in the Constitution or the patent statute. If the toxicity level of a particular drug is not a “discovery” in the classic sense of the term, than it will be very difficult to know what kinds of “discoveries” may be patentable.

Given that Congress has just concluded significant patent reform with the AIA, it is unlikely that Congress will address any concerns that may arise from Mayo in the near future. As a unanimous decision, it is unlikely that the Court itself will depart from the Mayo approach anytime soon. Thus, practitioners should get used to the instruction provided by Mayo and Bilski, as these cases are likely to provide the basis for ' 101 analysis for quite some time.

Stuart Meyer is a partner in the Intellectual Property Group of Fenwick & West LLP. His practice centers on patent, trade secret and copyright matters.