2019 Eligibility Guidance Leads to Unpredictable Results at the PTAB

| Bryan McWhorterRussell Jeide

In January of 2019, the Patent Office, under Director Iancu, issued new guidance to all USPTO personnel evaluating patent subject matter eligibility under the requirements of 35 USC Section 101. The guidance sought to add certainty to what has been widely recognized as an unpredictable area of law. (See more about the new guidance at our prior post on the subject.) The view of most practitioners appears to be that the new guidance is positive for applicants, particularly for patent applications directed to software‑related inventions. But seasoned patent applicants will recognize that many examiners have their own interpretations of examination guidelines—often not in line with that of the applicant. And when an applicant is unhappy with a rejection, the next step is generally an appeal to the Patent Trial and Appeal Board.[1]

So how has the PTAB handled the 2019 Guidance? A review of eight publicly‑available PTAB decisions[2] issued since the guidance reveals that each has at least mentioned the 2019 Guidance. But their implementation of the guidance varies widely. Two of these decisions have explicitly adopted the guidance as controlling—and found the claims at issue eligible as a result.[3] A third mentions the guidance only in passing, holding the claims at issue eligible under prior authority and finding that the guidance would not change that result.[4]

The remaining five decisions each find the claims ineligible, and while they reference the guidance, their reasoning at times seems contrary to it. The 2019 Guidance indicates that a claim is not “directed to” an abstract idea (and thus is patent eligible) if the claim incorporates the abstract idea into a “practical application” of that idea.[5] A “practical application,” in the words of the guidance, is one that “appl[ies], rel[ies] on, or use[s] the judicial exception in a manner that imposes a meaningful limit on the judicial exception, such that the claim is more than a drafting effort designed to monopolize the judicial exception.”[6] On the surface, it would then seem that a claim that does not seek to “monopolize” an exception is not “directed to” that exception under the 2019 Guidance. Nevertheless, three of the five decisions of ineligibility dismissed arguments by the applicant as to a lack of monopolization not because monopolization was actually attempted, but because, according to the decisions, a lack of monopolization does not confer eligibility.[7] The remaining two decisions adhere more closely to the 2019 Guidance, finding that the claims do attempt to monopolize an exception.[8] However, the language of the decisions doesn’t indicate that the Board in those instances felt constrained by the 2019 Guidance. The decisions, for example, were based significantly on findings that the claims included broad, functional recitations[9]—a factor that, according to Director Iancu, should be separate from eligibility.[10]

These varying interpretations can have significant impact to the outcome of an appeal. Compare, for example, the decision in Patent App. No. 13/287,831 where the Board held claims eligible based on a finding that “‘collecting usage information’ is not an abstract idea under the 2019 Guidance,”[11] with the decision in Patent App. No. 13/779,724 where the Board cited Federal Circuit precedent to find claims ineligible based on precisely the opposite conclusion: that “collecting information … [is] within the realm of abstract ideas.”[12] These decisions were issued within days of one another, both citing the 2019 Guidance.

The guidance instructs “all personnel,” presumably including the Board, to adhere to its provisions.[13] But the guidance also states that it “does not have the force and effect of law” and failure to follow those provisions “is not, in itself, a proper basis for either an appeal or a petition.”[14] Whether the Board elects to simply apply the guidance or to instead to invoke caselaw seems to vary, likely based on the facts of each case. Unfortunately, the end result—at least so far—is continued uncertainty at the Board level. And without the Board ensuring the guidance’s consistent use and application, inconsistency of its application by Examiners may also continue. So while the guidance may be a positive step for applicants in some instances, it’s unclear yet whether it will succeed in reducing the uncertainty of subject matter eligibility at the USPTO.

Editors: Mauricio Uribe & Philip M. Nelson

[1] Of course, applicants may unofficially appeal an examiner’s actions to a supervising examiner. However, experienced practitioners will recognize that the results of that process are unpredictable and vary greatly among art units.

[2] U.S. Patent App. Nos. 12/374,372, 12/906,381, 13/225,430, 13/287,831, 13/799,724, 13/810,242, 13/841,634, and 14/282,015. Each pending appeal was made prior to the issuance of the guidance, and thus the guidance was not argued by the parties. Nevertheless, since the Board considered the guidance in each case, these decisions may give insight into how the Board will apply the guidance going forward.

[3] Ex Parte Fanaru, Appeal No. 2017-002898, Patent App. No. 13/287,831 (PTAB Jan. 22, 2019), p. 6 (describing the Board’s Section 101 analysis as “under [the 2019] guidance”); Ex Parte Rockwell, Appeal No. 2018-004973, Patent App. No. 13/282,015 (PTAB Jan. 16, 2019), p. 6 (stating that the 2019 Guidance “explains how we must analyze patent-eligibility questions”).

[4] Ex Parte Carr, Appeal No. 2018-005890, Patent App. No. 12/374,372 (PTAB Jan. 24, 2019), p. 6 (reversing the examiner and holding that the “same findings and conclusions are required to analyze the Examiner’s rejection under the new 2019 Revised Patent Subject Matter Eligibility Guidance”).

[5] 2019 Revised Patent Subject Matter Eligibility Guidance, 80 Fed. Reg. 50, 54 (“If the recited exception is integrated into a practical application of the exception, then the claim is eligible.”)

[6] Id.

[7] Ex Parte Asher, Appeal No. 2017-002008, Patent App. No. 12/906,381 (PTAB Jan. 22, 2019), p. 10 (summarily dismissing Appellants argument that “the claims are patent-eligible because the claims would not ‘tie up’ or preempt others from using the alleged abstract idea, because under Ariosa Diagnostics v. Sequenom Inc. (788 F.3d 1371, 1379 (Fed. Cir. 2015)) “the absence of complete preemption does not demonstrate patent eligibility; Ex Parte Quigley, Appeal No. 2017-008917, Patent App. No. 13/779,724 (PTAB Jan. 17, 2019), p. 11; Ex Parte Seid, Appeal No. 2017-009988, Patent App. No. 13/841,634 (PTAB Jan. 22, 2019), p. 12 (dismissing a preemption argument under Ariosa, but also finding that the claims do not apply the exception in a meaningful way, “such that the claims as a whole are more than a drafting effort designed to monopolize the exception.”)

[9] Ex Parte Bravata, Appeal No. 2017-002727, Patent App. No. 13/225,430 (PTAB Jan. 22, 2019), p. 5; Ex Parte Crawford, Appeal No. 2017-005855, Patent App. No. 13/810,242 (PTAB Jan. 22, 2019), p. 5.

[10] Remarks by Director Iancu at the Intellectual Property Owners Association 46th Annual Meeting, Sep. 24, 2018 (discussing prior drafts of the 2019 Guidance and noting that the “analysis also does not deny claims as ineligible merely because they are broad or functionally-stated or result-oriented”).

[13] 80 Fed. Reg. 50, 51.

[14] Id.