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Fieldfisher Seminar Review: Alice v CLS Bank

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K2 IP Limited

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photo-3rAs noted earlier this week, I had the pleasure of attending Fieldfisher’s recent Patent Experts Seminar on 10th July. The seminar comprised contributions from guest speakers including Frank L. Bernstein from Kenyon & Kenyon LLP in the US who spoke to the issue of Alice v CLS Bank (Alice v. CLS Bank: Through the Looking Glass, or Through a Glass Darkly?).

After recapping the basics of the Alice case (settlement risk method performed on generic computer, not patent eligible under §101), Frank turned his attention to the USPTO Guidelines which issued less than a week after Alice (19 June for decision; 25 June for Guidelines). The Alice Guidelines differ from prior guidance in a couple of ways. Firstly, they note that the same analysis should be used against all judicial exceptions (previous USPTO guidance had applied different analysis to abstract ideas (e.g. in Bilksi) versus laws of nature (Mayo)) and secondly, that the same analysis should be used against all claim categories.

Under the Alice guidelines, the USPTO should approach claim assessment as follows:

1. Determine if the claim is directed towards one of the 4 statutory invention categories, namely, process, machine, manufacture or composition of matter. If the claim is not directed towards one of these categories then reject it as relating to non-statutory subject matter. If the claim is within one of the statutory categories then proceed to step 2.

2. Determine if the claim is directed to a judicial exception, e.g. law of nature, natural phenomenon, abstract idea. If the claim is not directed towards one of these exceptions then it can be assessed for novelty/inventive step. If the claim is directed to a judicial exception then apply a two-step test (step 3).

3. Two step test.

Step 1: Determine whether the claim is directed to an abstract idea. As per the Alice case, abstract ideas are excluded from eligibility as monopolizing basic scientific tools might impede innovation and not promote it.

Step 2: If an abstract idea is present in the claim, determine whether any element, or combination of elements, is sufficient to ensure that the claim amounts to significantly more than the abstract idea itself.

The phrase “significantly more” is interesting and the USPTO Guidance suggests that examples of limitations that would meet this “significantly more” feature include:

  • Improvements to another technology or technical fields;
  • Improvements to the functioning of the computer itself;
  • Meaningful limitations beyond generally linking the use of an abstract idea to a particular technological environment

Examples of limitations that would not meet this “significantly more” feature include:

  • Adding the words “apply it” (or an equivalent) with an abstract idea, or mere instructions to implement an abstract idea on a computer;
  • Requiring no more than a generic computer to perform generic computer functions that are well-understood, routine and conventional activities previously known to the industry.

Frank highlighted how the last two points compare against current USPTO Examiner practice where applicants are allowed to recite “Using a processor” to perform method steps that are part of an algorithm and where system claims are drafted to features such as processor and a memory.

The Alice decision, and its predecessors, of course do not define the concept of an “abstract idea” and so this is something that is likely to develop over time. What is interesting for European observers is the presence of language in the Alice decision (“Nor do they effect an improvement in any other technology or technical field”) that isn’t a million miles away from the concept of technical effect.

Arguments around the concept of Abstract ideas are likely to crop up in more cases  in the US and indeed the first such case has already been decided by the Federal Circuit in Digitech Image v. Electronics for Imaging, Inc.

Mark Richardson 23 July 2014


1 Comment

  1. hollyipltd says:

    I think an interesting question is what proportion of US software patents are now likely to be invalid under the new Guidelines. At least one US commentator has said that many would be, implying that there are a lot of US patents where the invention is simply taking a known idea and implementing it on a generic computer.

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