By Dennis Haszko
“A transient event is a
short-lived burst of energy in a system caused by a sudden change of state.”
Recently, the U.S. Patent & Trademark Office
(USPTO) published the 2019 Revised Patent Subject Matter
Eligibility Guidance (2019 PEG) which has predictably caused
a stir in the field of business method patents.
After the U.S. Supreme
Court’s key decisions over the last decade in Bilski v. Kappos, 130 S. Ct. 3218
(2010); Mayo Collaborative Services v. Prometheus Laboratories, Inc., 132 S.
Ct. 1289 (2012), and Alice Corp. Pty. Ltd. V. CLS Bank International, 134 S.
Ct. 2347 (2014), the courts in the US have increasingly found certain
computerized methods of doing business to be unpatentable. Moreover, patent examiners at the USPTO have
been brought to near deadlock in many instances where patent applications become
mired in the threshold question of whether the invention constitutes patent
eligible subject matter under 35 U.S.C. 101.
To date, the USPTO has applied the key decisions
inconsistently and oftentimes seemingly
arbitrarily. This has made negotiating
with patent examiners less a science and more of an art. Typical rejections under 35 U.S.C. 101
include a blanket assertion that the subject matter “forms an abstract idea”
and “fails to constitute something significantly more.”
The 2019 PEG is an effort by the USPTO to provide
clarity and consistency during the patenting process. Patent examiners are now
directed to review and analyze patent applications in a more stringent manner. The updated analysis can be distilled to the
- Does the claimed subject matter recite a judicial
exception related to:
- Mathematical concepts— mathematical relationships,
mathematical formulas or equations, mathematical calculations;
- Certain methods of organizing human
activity—fundamental economic principles or practices (including hedging,
insurance, mitigating risk); commercial or legal interactions (including
agreements in the form of contracts; legal obligations; advertising, marketing
or sales activities or behaviors; business relations); managing personal
behavior or relationships or interactions between people (including social
activities, teaching, and following rules or instructions); or
- Mental processes – concepts performed in the human
mind (including an observation, evaluation, judgment, opinion)?
- If a judicial exception is identified, then is it
integrated into a practical application? If so, then the invention is at least
subject matter eligible, though it must still be analyzed for novelty and
- If a judicial exception is identified, but not
integrated into a practical application, then the claimed subject matter may
only be considered subject matter eligible if it provides an inventive concept
where the claimed subject matter forms “significantly more” than the recited
While this updated analysis under the 2019 PEG
still reflects a lot of gray area, it does clearly lay out the types of claimed
subject matter in a more distinct list.
Moreover, the analysis provides patent practitioners with a more
“scientific” or logical approach to arguing that a practical application exists. This is better than the previous, more ambiguous
approach of arguing that the invention provides “significantly more.” As experienced patent practitioners can
attest, previous USPTO attempts at dealing with business method inventions had
led to arguments that can, at best, be characterized as mere throws of the
dice. The 2019 PEG, at the very least,
should provide a seemingly logical blueprint for crafting suitable arguments.
Only time will tell whether the 2019 PEG is a mere
signal transient or something more meaningful in terms of obtaining business
method patents from the USPTO.